DTE Energy Reports Strong Third-Quarter Profit

(Reuters) – Electric and gas utility DTE Energy (NYSE:DTE) exceeded Wall Street's expectations for third-quarter profit on Thursday, with favorable supply rates and warmer weather benefiting its electricity unit.

Shares of the company increased by 1% in premarket trading.

Financial Performance

On an adjusted basis, the Michigan-based company reported an operating profit of $2.22 per share for the three months ending September 30, compared to analysts' average estimate of $1.88 per share, according to data compiled by LSEG.

Importance

U.S. electric companies have been seeking higher customer electricity rates from regulators to finance infrastructure upgrades due to extreme weather events, growing demand driven by industry electrification, and expansion of tech sector data centers.

Last year saw record rate increases in the U.S., as reported by the Energy Information Administration.

The S&P index tracking utilities surged 18.4% in the third quarter, in comparison to a 5.5% rise in the S&P 500.

Company Overview

The Detroit, Michigan-based company serves 2.3 million customers with electricity and 1.3 million customers with natural gas in Michigan.

So far this year, DTE Energy has invested over $3 billion to upgrade its electric and gas grids and aims to invest over $4 billion in 2024.

By the Numbers

Total net income attributable to DTE rose to $460 million in the quarter, up from $298 million the previous year.

The electric segment, its largest unit by net income, reported adjusted earnings of $437 million in the quarter, compared to $268 million a year ago. However, the gas segment showed an adjusted loss of $13 million, worse than the $5 million loss recorded the previous year, partly due to higher operating costs.

The firm reaffirmed its 2024 adjusted profit forecast of $6.54 to $6.83 per share, while analysts predict a profit of $6.70 per share.