Shares of Middlesex Water Company (NASDAQ: MSEX) tumbled 6.07% in after-hours trading on Friday following the release of its third-quarter 2025 financial results, which fell short of analyst expectations. The water utility company reported lower earnings and revenue, primarily due to decreased consumption driven by unfavorable weather conditions.
Middlesex Water announced earnings per share (EPS) of $0.77 for the third quarter, missing the analyst consensus estimate of $0.85 by 9.4%. This represents a decline from the $0.80 per share reported in the same period last year. The company's revenue also disappointed, coming in at $54.1 million, below the expected $56.08 million and down 1.8% from the previous year's $55.1 million.
The company attributed the weaker performance to lower consumption driven by unfavorable weather, which was partially offset by rate increases and customer growth. Operating expenses for the quarter decreased to $36.4 million from $37.6 million in the previous year, mainly due to higher capitalizable costs and lower legal, financial, and regulatory expenses. However, this was partially countered by higher variable production costs from weather-driven lower water quality and increased depreciation.
Despite the challenging quarter, Middlesex Water continues to focus on infrastructure investment and growth. The company invested approximately $72 million in water and wastewater utility infrastructure during the first nine months of 2025, representing about 77% of its planned $93 million annual investment. Additionally, Middlesex executed an asset purchase agreement to acquire Pinewood Acres water utility assets in Delaware, aligning with its strategy for selective and sustainable growth.
The disappointing results and subsequent stock price drop highlight the sensitivity of utility companies to weather conditions and their impact on consumption patterns. Investors will likely be watching closely to see how Middlesex Water adapts to these challenges and whether it can improve its performance in the coming quarters.