EDP Renovaveis delivered a solid fourth quarter 2025, posting EBITDA of €557 million, a 6% increase over analyst expectations and 9% above its own consensus. This outperformance, driven by improved operational efficiency and institutional partnerships, pushed recurring net profit to €141 million, beating estimates by 8% and 5% respectively. However, the company narrowed its 2026 EBITDA guidance range to €2.1 billion, down from the previous €2.1 billion to €2.2 billion, signaling potential challenges ahead despite the quarterly success.

The EBITDA gain came despite a 10% decline in average selling price to €53 per MWh, reflecting price normalization in European markets. Tax equity revenues in the US surged to €421 million, fueled by 1.1 GW of new solar and battery storage capacity. While capital gains reached €60 million, exceeding estimates, the company also noted cost reductions in Colombia and Romania, partially offset by negative impacts in Vietnam. The dividend per share remained consistent at €0.13, maintaining the 40% payout ratio.

The guidance adjustment, while aligning with consensus, raises questions about near-term growth sustainability and execution risks, particularly concerning cost management outside core regions. Investors will watch closely for clarity on how the company plans to navigate the challenging European market dynamics and maintain its renewable energy expansion momentum.