Xcel Energy Inc. Q2 FY26 Earnings Analysis

- First quarter electric sales increased by 2.8% on a weather-adjusted basis, driven by oil and gas growth in SPS and broader commercial & industrial growth across jurisdictions. - Full-year 2026 weather-adjusted electric sales are expected to increase by 3%. - Rate base growth is very front-end loaded, with capital investments back-end loaded, indicating upcoming acceleration in rate base. - Large incremental loads (especially data centers) are expected to boost sales growth and provide opportunities to improve earned returns. - Company expects growth from diversified sources including renewables, oil and gas growth, and new large customer loads. - Long-term EPS growth expected at 9% CAGR through 2030, supported by sales growth and investments.

- Xcel Energy is confident in delivering 6% to 8+% long-term earnings growth. - They expect an average 9% EPS CAGR through 2030. - The company reaffirms 2026 ongoing EPS guidance range of $4.04 to $4.16 per share. - Long-term growth driven by extensive capital investment plan (over $7 billion line of sight, $10+ billion investment pipeline). - Growth fueled by rate base expansion, new renewable projects, large customer loads like data centers, and transmission upgrades. - Structural improvements and rate case outcomes expected to gradually close under-earning gaps, particularly in Colorado. - Equity financing planned at roughly 40% of capital investments, maintaining strong balance sheet and credit metrics. - Data center loads present long-term opportunities for affordability and earnings improvements.

- Xcel Energy is executing a $14 billion capital investment plan in 2026, the most extensive in company history. - Near-term projects include: - SPS Renewable Energy Standard RFP: 1,500 to 3,000 MW renewables, filing with New Mexico Commission in Q2. - NSP RFP in Minnesota: 4,000+ MW renewable generation and storage, filing later in 2026. - Colorado GTS RFP to be filed in 2026, focusing on renewables and some thermal baseload. - Competitive bidding for 765kV transmission lines in SPP region in 2026, decision expected next year. - Data center-related investments: - 1 GW execution in 2026. - Additional 3 GW expected in 2027, dependent on resource types. - Long-term: Over $7 billion incremental investments through 2030 with a $10+ billion overall investment pipeline extending into early 2030s. - Strategic partnerships with Tier 1 EPC firms, GE Vernova, and NextEra to support project delivery.

- In Q1, Xcel Energy proactively issued forward contracts for over $1 billion of equity from its ATM program and an $800 million junior subordinated note at the holding company, receiving 50% equity credit from rating agencies. - This activity, combined with unsettled forwards and collar forward contracts from 2025, covers over half of their $7 billion equity need in the 5-year base plan. - Management did not provide specific timing for the remaining equity issuance but emphasized flexibility with the ATM program extended by a few years. - The company plans to continue proactive equity issuance aligned with capital investment needs, aiming to maintain a strong balance sheet throughout a large build cycle. - Alternative financing options are being considered but the base plan currently expects roughly 40% equity funding for incremental CapEx. - No new specific debt issuances were announced beyond the noted junior subordinated note.

- Xcel Energy has a $10+ billion investment plan with line of sight to $7+ billion incremental opportunities. - Received bids for SPS RFP (1,500 to 3,000 MW) with filing planned in Q2; targets renewables by 2030. - NSP RFP bids received; filing expected with Minnesota Commission later this year for 4,000+ MW renewable/storage by 2030. - Colorado RFP planned later this year; some baseload thermal generation expected possibly into early 2030s. - Competitive bid for 765 kV transmission line in SPP planned; decision expected next year. - Data centers: Executing 1 GW in current year, with 3 GW expected in following year. - NextEra Joint Development Agreement aiming for 2 GW, potentially expandable beyond that. - High probability pipeline includes 4+ GW data center contracts by end of 2027. - RFPs and projects primarily focused on renewable and clean energy generation to support data center load growth.