XELLL — Xcel Energy Inc. 6.25% Junior Subordinated Notes, Series due 2085

Summary of Xcel Energy Q1 2026 Earnings Call

1. Key Financial Results and Metrics

• Ongoing Earnings: Xcel Energy reported ongoing earnings of $0.91 per share for Q1 2026, up from $0.84 per share in Q1 2025.
• GAAP Earnings: Reported GAAP earnings were $0.89 per share, impacted by nonrecurring charges related to a $41 million disallowance of replacement power costs and a $22 million increase in estimated insurance proceeds for wildfire litigation.
• Revenue Drivers: Higher electric revenues from rate case outcomes and sales growth contributed positively, while increased interest charges and depreciation negatively impacted earnings.
• Weather Impact: The warmest winter on record in Colorado reduced earnings by $0.09 per share due to lower electric and natural gas sales.

2. Strategic Updates and Business Highlights

• Capital Investment: Xcel Energy invested over $3 billion in infrastructure in Q1 2026, part of a $14 billion capital investment plan for the year, the largest in the company's history.
• Data Center Agreements: A significant contract with Google for a new data center will involve 1,900 megawatts of new wind and solar generation, projected to save customers $1 billion to $1.5 billion over the contract's term.
• Joint Development Agreement: A partnership with NextEra Energy aims to co-develop 2 gigawatts of generation and storage to support data center growth.
• Regulatory Progress: Positive developments in rate cases across North Dakota, South Dakota, and Minnesota, with constructive outcomes anticipated.

3. Forward Guidance and Outlook

• 2026 EPS Guidance: Xcel reaffirmed its ongoing EPS guidance range of $4.04 to $4.16 per share for 2026, with expectations of 6% to 8% long-term earnings growth and 9% EPS growth on average through 2030.
• Incremental Investment Opportunities: The company identified $7 billion of line-of-sight opportunities within a $10 billion incremental investment plan, driven by new generation and transmission needs.

4. Bad News, Challenges, or Points of Concern

• Regulatory Disallowances: The company faced a $41 million disallowance related to the Prairie Island outage, impacting earnings.
• Weather-Related Sales Decline: The unusually warm winter negatively affected gas and electric sales, highlighting vulnerability to weather patterns.
• Execution Risks: As Xcel embarks on its extensive capital investment plan, there are concerns about supply chain constraints and labor availability for ongoing projects.

5. Notable Q&A Insights

• Regulatory Settlement Confidence: Management expressed optimism about reaching settlements in ongoing rate cases, particularly in Colorado and Minnesota, citing historical success in achieving constructive outcomes.
• Data Center Load Benefits: The company highlighted that large data center loads could help share fixed costs of the grid, potentially benefiting existing customers by lowering rates.
• Equity Financing Strategy: Xcel has proactively secured 50% of its equity needs for its 5-year plan within the first quarter, with flexibility in timing future equity issuances based on capital investment needs.
• Wildfire Claims Update: Progress has been made in settling wildfire claims, with a low-end liability estimate of $460 million and settlements nearing $400 million.

This summary captures the essential aspects of Xcel Energy's Q1 2026 earnings call, highlighting both achievements and challenges faced by the company.