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October 29, 2025 • 4 min read
Edison International (EIX), the parent company of Southern California Edison (SCE), is a major player in the U.S. energy sector, providing electricity to millions of customers. In its most recent quarterly report filed with the SEC, the company revealed a significant uptick in profitability, but also highlighted the persistent financial challenges posed by California's wildfire risks. Let's delve into the numbers to see what's driving their performance.
For the third quarter of 2025, Edison International reported a total revenue of $5.75 billion, which translated into a net income of $888 million. This represents a substantial increase from the $577 million in net income reported in the same quarter of the previous year. Diluted earnings per share followed suit, rising to $2.16 from $1.32.
The following flow diagram provides a visual breakdown of how the company's revenue for the quarter was allocated across various costs and expenses, ultimately leading to its net income.
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In the diagram, the "Unallocated" revenue of -$93 million represents the net difference between the total consolidated operating revenue for the parent company, Edison International, and the sum of revenues from customer contracts at its subsidiary, SCE. This figure accounts for various intercompany eliminations and other adjustments necessary for consolidated reporting.
A key driver behind the strong performance was a favorable regulatory outcome. The 2025 General Rate Case (GRC) final decision allowed for higher authorized revenue, directly boosting the company's top line. A GRC is a formal process where utility regulators, like the California Public Utilities Commission (CPUC), review a utility's costs and approve the rates it can charge customers. This quarter's results demonstrate the positive impact such a decision can have on financial performance.
On the expense side, the company saw a decrease in "Operation and maintenance" costs, which fell to $1.18 billion from $1.39 billion in the prior-year quarter. However, this was largely offset by higher depreciation and other expenses. The largest single operating cost was "Purchased power and fuel," which came in at $1.7 billion.
While profitability surged, the filing underscores the significant financial risk associated with wildfires in California. In Q3 2025, Edison International recorded a charge of $295 million for "Wildfire-related claims, net of (recoveries)." This expense was primarily linked to the 2025 Eaton Fire.
This single line item reveals the dual nature of the wildfire challenge. While this quarter saw a substantial new charge, the story for the first nine months of the year is different. Over that period, the company actually recorded a net recovery of over $1 billion in this category. This was due to a massive $1.34 billion recovery authorized under a settlement for the 2017/2018 wildfire events (specifically the Thomas, Koenigstein, and Montecito fires). This demonstrates the volatile, long-term cycle of incurring massive costs from these events and then attempting to recover them through insurance and regulatory proceedings, often years later.
The company's revenue is primarily generated by its SCE subsidiary. For the quarter, revenue from customer contracts was broken down as follows:
This shows a fairly balanced revenue stream between its commercial and residential customer bases.
In conclusion, Edison International's third-quarter results paint a picture of a company benefiting from a supportive regulatory environment that has bolstered its core earnings. However, the ever-present threat of catastrophic wildfires continues to cast a shadow, introducing significant volatility and financial risk. The company's ability to manage this risk, both operationally in the field and financially through regulatory and legal channels, remains the critical challenge for its long-term stability and growth.
Last updated: October 29, 2025