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Xcel Q2 Earnings Beat Estimates on Infrastructure Investment Recovery
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Key Takeaways
Xcel Energy's Q2 earnings beat estimates by 17.72%, while revenues fell 5.1% and missed forecasts.
Lower fuel and purchased-power costs added 30 cents per share, helping lift operating income 22.4%.
XEL reaffirmed 2026 EPS guidance and outlined more than $70 billion in potential 2026-2030 investment.
Xcel Energy Inc. (XEL - Free Report) reported second-quarter 2026 ongoing earnings of 93 cents per share, beating the Zacks Consensus Estimate of 79 cents by 17.72%. Earnings increased 24% from 75 cents in the year-ago quarter, aided by greater recovery of electric infrastructure investments.
Earnings benefited from lower electric fuel and purchased-power costs, which contributed 30 cents per share to the year-over-year change. Higher allowance for funds used during construction, or AFUDC, added 8 cents, while lower depreciation and amortization contributed another 8 cents.
These gains were partly offset by a 12-cent drag from higher interest charges, a 6-cent impact from common-equity financing and a 4-cent reduction from lower natural gas revenues.
Total Revenues
Revenues of $3.12 billion missed the consensus estimate of $3.61 billion by 13.48% and declined 5.1% year over year. Weather-adjusted retail electric sales rose 1.5%, while electric and natural gas customer counts each increased 0.7%.
Electric revenues declined 4.8% year over year to $2.74 billion. The decrease reflected lower fuel-cost recovery, production tax credits passed back to customers, weaker wholesale generation revenues and regulatory rate outcomes. These factors were partly offset by higher non-fuel rider revenues, sales and demand, and wholesale transmission revenues.
Natural gas revenues fell 7.8% to $365 million, primarily because of lower gas-cost recovery and reduced sales volumes. Other revenues increased to $14 million from $13 million. Electric and natural gas cost fluctuations are generally offset through regulatory recovery mechanisms and have limited impact on earnings.
Xcel Energy Inc. Price, Consensus and EPS Surprise
Total operating expenses declined 11% year over year to $2.41 billion. Electric fuel and purchased-power expenses fell $240 million to $678 million, while the cost of natural gas sold and transported decreased $41 million to $93 million.
Operating and maintenance expenses increased $16 million to $691 million, partly due to higher generation costs. Operating income advanced 22.4% year over year to $706 million.
Interest charges and financing costs increased 23.6% to $398 million, primarily due to higher debt levels.
Xcel Energy Reaffirms 2026 Guidance
Xcel Energy reaffirmed its 2026 ongoing earnings guidance of $4.04-$4.16 per share. The outlook assumes weather-adjusted retail electric sales growth of approximately 3% and weather-adjusted firm natural gas sales growth of around 1%. The Zacks Consensus Estimate for 2026 is currently pegged at $4.11 per share.
Management expects capital-rider revenues to increase $480-$490 million, while operating and maintenance expenses are projected to rise about 3%. The company anticipates interest expense, net of debt AFUDC, to increase $240-$250 million, partly offset by a $150-$160 million increase in equity AFUDC.
XEL Expands Its Long-Term Investment Pipeline
XEL outlined more than $70 billion of potential capital investment during 2026-2030, comprising a $60 billion base plan and over $10 billion of additional opportunities. The program includes roughly 11,400 megawatts (“MW”) of renewable generation, 3,400 MW of natural gas generation and 2,200 MW of energy storage.
The company has about 2 gigawatts (“GW”) of data-center capacity contracted or under construction and expects contracted capacity to reach roughly 4 GW by the end of 2027. Its broader pipeline exceeds 20 GW, providing potential support for future generation and transmission investment.
NextEra Energy (NEE - Free Report) reported second-quarter 2026 results with adjusted earnings per share of $1.15, up 9.5% from $1.05 a year ago. The figure beat the Zacks Consensus Estimate of $1.09 by 5.5%.
The Zacks Consensus Estimate for 2026 and 2027 earnings per share indicates year-over-year growth of 8.36% and 8.73%, respectively.
FirstEnergy (FE - Free Report) reported second-quarter 2026 adjusted earnings of 50 cents per share, which beat the Zacks Consensus Estimate of 49 cents by 2.04%. In the year-ago quarter, the company reported earnings of 52 cents per share.
The Zacks Consensus Estimate for 2026 and 2027 earnings per share implies year-over-year growth of 7.06% and 7.78%, respectively.
WEC Energy Group (WEC - Free Report) reported second-quarter 2026 earnings of 91 cents per share, which surpassed the Zacks Consensus Estimate of 80 cents by 13.75%. The bottom line also increased 19.74% from the year-ago quarter’s 76 cents.
The Zacks Consensus Estimate for 2026 and 2027 earnings per share indicates year-over-year growth of 6.07% and 7.44%, respectively.
View the Zacks #1 Rank List
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Xcel Q2 Earnings Beat Estimates on Infrastructure Investment Recovery
Key Takeaways
Xcel Energy Inc. (XEL - Free Report) reported second-quarter 2026 ongoing earnings of 93 cents per share, beating the Zacks Consensus Estimate of 79 cents by 17.72%. Earnings increased 24% from 75 cents in the year-ago quarter, aided by greater recovery of electric infrastructure investments.
Earnings benefited from lower electric fuel and purchased-power costs, which contributed 30 cents per share to the year-over-year change. Higher allowance for funds used during construction, or AFUDC, added 8 cents, while lower depreciation and amortization contributed another 8 cents.
These gains were partly offset by a 12-cent drag from higher interest charges, a 6-cent impact from common-equity financing and a 4-cent reduction from lower natural gas revenues.
Total Revenues
Revenues of $3.12 billion missed the consensus estimate of $3.61 billion by 13.48% and declined 5.1% year over year. Weather-adjusted retail electric sales rose 1.5%, while electric and natural gas customer counts each increased 0.7%.
Electric revenues declined 4.8% year over year to $2.74 billion. The decrease reflected lower fuel-cost recovery, production tax credits passed back to customers, weaker wholesale generation revenues and regulatory rate outcomes. These factors were partly offset by higher non-fuel rider revenues, sales and demand, and wholesale transmission revenues.
Natural gas revenues fell 7.8% to $365 million, primarily because of lower gas-cost recovery and reduced sales volumes. Other revenues increased to $14 million from $13 million. Electric and natural gas cost fluctuations are generally offset through regulatory recovery mechanisms and have limited impact on earnings.
Xcel Energy Inc. Price, Consensus and EPS Surprise
Xcel Energy Inc. price-consensus-eps-surprise-chart | Xcel Energy Inc. Quote
Xcel Energy’s Operating Profit Climbs
Total operating expenses declined 11% year over year to $2.41 billion. Electric fuel and purchased-power expenses fell $240 million to $678 million, while the cost of natural gas sold and transported decreased $41 million to $93 million.
Operating and maintenance expenses increased $16 million to $691 million, partly due to higher generation costs. Operating income advanced 22.4% year over year to $706 million.
Interest charges and financing costs increased 23.6% to $398 million, primarily due to higher debt levels.
Xcel Energy Reaffirms 2026 Guidance
Xcel Energy reaffirmed its 2026 ongoing earnings guidance of $4.04-$4.16 per share. The outlook assumes weather-adjusted retail electric sales growth of approximately 3% and weather-adjusted firm natural gas sales growth of around 1%. The Zacks Consensus Estimate for 2026 is currently pegged at $4.11 per share.
Management expects capital-rider revenues to increase $480-$490 million, while operating and maintenance expenses are projected to rise about 3%. The company anticipates interest expense, net of debt AFUDC, to increase $240-$250 million, partly offset by a $150-$160 million increase in equity AFUDC.
XEL Expands Its Long-Term Investment Pipeline
XEL outlined more than $70 billion of potential capital investment during 2026-2030, comprising a $60 billion base plan and over $10 billion of additional opportunities. The program includes roughly 11,400 megawatts (“MW”) of renewable generation, 3,400 MW of natural gas generation and 2,200 MW of energy storage.
The company has about 2 gigawatts (“GW”) of data-center capacity contracted or under construction and expects contracted capacity to reach roughly 4 GW by the end of 2027. Its broader pipeline exceeds 20 GW, providing potential support for future generation and transmission investment.
XEL’s Zacks Rank
Xcel Energy currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Other Earnings Releases
NextEra Energy (NEE - Free Report) reported second-quarter 2026 results with adjusted earnings per share of $1.15, up 9.5% from $1.05 a year ago. The figure beat the Zacks Consensus Estimate of $1.09 by 5.5%.
The Zacks Consensus Estimate for 2026 and 2027 earnings per share indicates year-over-year growth of 8.36% and 8.73%, respectively.
FirstEnergy (FE - Free Report) reported second-quarter 2026 adjusted earnings of 50 cents per share, which beat the Zacks Consensus Estimate of 49 cents by 2.04%. In the year-ago quarter, the company reported earnings of 52 cents per share.
The Zacks Consensus Estimate for 2026 and 2027 earnings per share implies year-over-year growth of 7.06% and 7.78%, respectively.
WEC Energy Group (WEC - Free Report) reported second-quarter 2026 earnings of 91 cents per share, which surpassed the Zacks Consensus Estimate of 80 cents by 13.75%. The bottom line also increased 19.74% from the year-ago quarter’s 76 cents.
The Zacks Consensus Estimate for 2026 and 2027 earnings per share indicates year-over-year growth of 6.07% and 7.44%, respectively.