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AES (AES) Risk Analysis

Public companies are required to disclose risks that can affect the business and impact the stock. These disclosures are known as “Risk Factors”. Companies disclose these risks in their yearly (Form 10-K), quarterly earnings (Form 10-Q), or “foreign private issuer” reports (Form 20-F). Risk factors show the challenges a company faces. Investors can consider the worst-case scenarios before making an investment. TipRanks’ Risk Analysis categorizes risks based on proprietary classification algorithms and machine learning. AES disclosed 4 risk factors in its most recent earnings report. AES reported the most risks in the “Legal & Regulatory” category.

Risk Overview Q2, 2026

Source: the company's latest filing for the period ended Jun 30, 2026, filed Aug 04, 2026

Risk Distribution
4Risks
Sector Avg.Finance & CorporateTech & InnovationLegal & RegulatoryProductionAbility to SellMacro & Political
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Risk Change Over Time

AES disclosed risks per quarterNo. of Risks01020304050Q3Q2Q2Showing: Q2, 2026
Risks removedRisks addedRisks changedAES Risk Factors
No changes from previous report

Risk Highlights Q2, 2026

Main Risk Category
Legal & Regulatory
With 4 Risks
Number of Disclosed Risks
4
+1
From last report
S&P 500 Average: 32
Recent Changes
1Risks added
0Risks removed
0Risks changed
Since Jun 2026
Number of Risk Changed
0
No changes from last report
S&P 500 Average: 1

Risk Word Cloud

some of our subsidiaries participate in defined benefit pension plans and their net pension plan obligations may require additional significant contributions.require additional significant contributionsconcerns about ghg emissions and the potential risks associated with climate change have led to increased regulation and other actions that could impact our businesses.led to increased regulationour ability to grow our business depends on our ability to raise capital on favorable terms.our ability to raise capitaltax legislation initiatives or challenges to our tax positions could adversely affect us.challenges to our tax positionsour operations are subject to significant government regulation and could be adversely affected by changes in the law or regulatory schemes.subject to significant government regulationthe operation of power generation, distribution and transmission facilities involves significant risks.transmission facilities involves significant riskswe do not control certain aspects of our joint ventures or our equity method investments.aspects of our joint venturesour businesses are subject to stringent environmental laws, rules and regulations.subject to stringent environmental lawsthe aes corporation's ability to make payments on its outstanding indebtedness is dependent upon the receipt of funds from our subsidiaries.ability to make paymentssome of our subsidiaries participate in defined benefit pension plans and their net pension plan obligations may require additional significant contributions.defined benefit pension plans

Risk Factors Full Breakdown - Total Risks 4

Taxation & Government Incentives2 | 50.0%
  • Taxation & Government Incentives - Risk 1
    Deferred Income Taxes

    Deferred income taxes reflect the net tax effects of (a) temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes and (b) operating loss and tax credit carryforwards. These items are stated at the enacted tax rates that are expected to be in effect when taxes are actually paid or recovered.As of December 31, 2025, the Company had federal net operating loss carryforwards for tax return purposes of approximately $1.3 billion, which carry forward indefinitely. The Company also had capital loss carryforwards of approximately $2.1 billion, which expire in 2029 and 2030. Further, the Company had federal general business tax credit carryforwards of approximately $76 million, which expire primarily in 2040 and beyond. The Company had state net operating loss carryforwards as of December 31, 2025 of approximately $4.9 billion expiring primarily in years 2026 to 2045. As of December 31, 2025, the Company had foreign net operating loss carryforwards of approximately $3 billion that expire at various times beginning in 2026 and some of which carry forward without expiration.

  • Taxation & Government Incentives - Risk 2
    Income Tax Receivables and Payables

    The current income taxes receivable and payable are included in Other current assets and Accrued and other liabilities, respectively, on the accompanying Consolidated Balance Sheets. The noncurrent income taxes receivable and payable are included in Other noncurrent assets and Other noncurrent liabilities, respectively, on the accompanying Consolidated Balance Sheets. The following table summarizes the income taxes receivable and payable as of the periods indicated (in millions):December 31,20252024Income taxes receivable—current$69 $85 Income taxes receivable—noncurrent19 32 Total income taxes receivable$88 $117 Income taxes payable—current$117 $71 Income taxes payable—noncurrent— — Total income taxes payable$117 $71

See a full breakdown of risk according to category and subcategory. The list starts with the category with the most risk. Click on subcategories to read relevant extracts from the most recent report.

FAQ

What are “Risk Factors”?
Risk factors are any situations or occurrences that could make investing in a company risky. The Securities and Exchange Commission (SEC) requires that publicly traded companies disclose their most significant risk factors. This is so that potential investors can consider any risks before they make an investment. They also offer companies protection, as a company can use risk factors as liability protection. This could happen if a company underperforms and investors take legal action as a result. It is worth noting that smaller companies, that is those with a public float of under $75 million on the last business day, do not have to include risk factors in their 10-K and 10-Q forms, although some may choose to do so.
How do companies disclose their risk factors?
Publicly traded companies initially disclose their risk factors to the SEC through their S-1 filings as part of the IPO process. Additionally, companies must provide a complete list of risk factors in their Annual Reports (Form 10-K) or (Form 20-F) for “foreign private issuers”. Quarterly Reports also include a section on risk factors (Form 10-Q) where companies are only required to update any changes since the previous report. According to the SEC, risk factors should be reported concisely, logically and in “plain English” so investors can understand them.
How can I use TipRanks risk factors in my stock research?
Use the Risk Factors tab to get data about the risk factors of any company in which you are considering investing. You can easily see the most significant risks a company is facing. Additionally, you can find out which risk factors a company has added, removed or adjusted since its previous disclosure. You can also see how a company’s risk factors compare to others in its sector. Without reading company reports or participating in conference calls, you would most likely not have access to this sort of information, which is usually not included in press releases or other public announcements. A simplified analysis of risk factors is unique to TipRanks.
What are all the risk factor categories?
TipRanks has identified 6 major categories of risk factors and a number of subcategories for each. You can see how these categories are broken down in the list below. 1. Financial & Corporate Accounting & Financial Operations - risks related to accounting loss, value of intangible assets, financial statements, value of intangible assets, financial reporting, estimates, guidance, company profitability, dividends, fluctuating results. Share Price & Shareholder Rights – risks related to things that impact share prices and the rights of shareholders, including analyst ratings, major shareholder activity, trade volatility, liquidity of shares, anti-takeover provisions, international listing, dual listing. Debt & Financing – risks related to debt, funding, financing and interest rates, financial investments. Corporate Activity and Growth – risks related to restructuring, M&As, joint ventures, execution of corporate strategy, strategic alliances. 2. Legal & Regulatory Litigation and Legal Liabilities – risks related to litigation/ lawsuits against the company. Regulation – risks related to compliance, GDPR, and new legislation. Environmental / Social – risks related to environmental regulation and to data privacy. Taxation & Government Incentives – risks related to taxation and changes in government incentives. 3. Production Costs – risks related to costs of production including commodity prices, future contracts, inventory. Supply Chain – risks related to the company’s suppliers. Manufacturing – risks related to the company’s manufacturing process including product quality and product recalls. Human Capital – risks related to recruitment, training and retention of key employees, employee relationships & unions labor disputes, pension, and post retirement benefits, medical, health and welfare benefits, employee misconduct, employee litigation. 4. Technology & Innovation Innovation / R&D – risks related to innovation and new product development. Technology – risks related to the company’s reliance on technology. Cyber Security – risks related to securing the company’s digital assets and from cyber attacks. Trade Secrets & Patents – risks related to the company’s ability to protect its intellectual property and to infringement claims against the company as well as piracy and unlicensed copying. 5. Ability to Sell Demand – risks related to the demand of the company’s goods and services including seasonality, reliance on key customers. Competition – risks related to the company’s competition including substitutes. Sales & Marketing – risks related to sales, marketing, and distribution channels, pricing, and market penetration. Brand & Reputation – risks related to the company’s brand and reputation. 6. Macro & Political Economy & Political Environment – risks related to changes in economic and political conditions. Natural and Human Disruptions – risks related to catastrophes, floods, storms, terror, earthquakes, coronavirus pandemic/COVID-19. International Operations – risks related to the global nature of the company. Capital Markets – risks related to exchange rates and trade, cryptocurrency.