Europe's largest utility Iberdrola expects its business of building and upgrading power networks, particularly in Britain and the US, to lift earnings this year after it helped drive a 10 per cent rise in 2025 adjusted net profit.
The Spanish company is benefiting from its strategic shift towards the more regulated power grids business and plans to invest over €100 billion through 2031 to build on this.
Results are progressing ahead of plan, the company said. It is now targeting adjusted net profit - which excludes one-offs - of more than €6.6 billion ($7.8 billion) this year and more than €7.6 billion by 2028.
The company is "in the best position to exceed" previous 2028 guidance of around €7.6 billion after a "transformational 2025," Executive Chairman Ignacio Galan told analysts on a call. "Its 2026 guide is slightly above consensus, supported by the record high hydro reserves," RBC analyst Fernando Garcia said in a note.
"For 2028, Iberdrola is now pointing to over €7.6 billion, which is encouraging given the declining trend in power prices and negative impact of FX." Iberdrola posted an adjusted net profit of €6.23 billion in 2025, up more than 10 per cent on the year and in line with its guidance.
A strong performance in its power grid operations offset lower earnings in its division that includes renewable power, which was hit by costs of around €177 million tied to the operation of the Spanish power system after an April 28 blackout and by lower power prices for renewables in Britain and Spain.
Last year's results include fourth-quarter charges of €464 million to adjust the value of its renewable pipeline in several countries, Galan said.
In coming days, the company will install the final two turbines at its 806-megawatt Vineyard Wind 1 offshore wind project in Massachusetts, reaching the planned 62, CEO Pedro Azagra said. The project is already selling electricity.
In late January, a federal judge allowed Vineyard Wind to resume work on the project, which President Donald Trump's administration had halted along with others due to national security concerns. Iberdrola proposed a dividend of €0.68 a share for 2025, a 6.3 per cent increase on the year.
(Reporting by Pietro Lombardi; Editing by David Latona and Mark Potter)