Xcel Energy Q3 Earnings and Sales Lag Estimates, 2026 EPS Initiated

Core Insights - Xcel Energy Inc. (XEL) reported third-quarter 2025 operating earnings of $1.24 per share, missing the Zacks Consensus Estimate of $1.31 by 5.3% and also falling short of the previous year's figure by a penny [1][8] - The decline in earnings per share was attributed to higher interest charges and operating & maintenance (O&M) expenses, which were partially offset by increased recovery of infrastructure investments [1][8] Revenue Performance - Total revenues for Xcel Energy amounted to $3.92 billion, slightly missing the Zacks Consensus Estimate of $3.93 billion by 0.3%, but representing a 7.4% increase from $3.64 billion in the same quarter last year [2] - Electric segment revenues reached $3.64 billion, up 7.4% from $3.39 billion year-over-year, while natural gas revenues increased by 10.5% to $264 million from $239 million [3] Operating Expenses and Income - Total operating expenses rose by 15.8% year-over-year to $3.17 billion, driven by higher electric fuel and purchased power costs, as well as increased taxes other than income tax [4] - Operating income decreased by 17.8% year-over-year to $911 million, with total interest charges and financing costs increasing by 14.1% from $348 million to $322 million [4] Customer Volume and Growth - In the first nine months of 2025, Xcel Energy experienced a 2.5% growth in electric customer volume, while natural gas customer volume saw a slight decline of 0.3% [5] - In the third quarter, natural gas customers increased by 0.8% and electric customers by 0.9% compared to the previous year [5] Future Guidance - Xcel Energy reaffirmed its 2025 earnings per share guidance in the range of $3.75-$3.85, with the Zacks Consensus Estimate at $3.81, and initiated a 2026 earnings per share outlook of $4.04-$4.16 [6] - The company anticipates retail electric sales to increase by 3% in 2025, while natural gas sales volumes are expected to remain flat [7] - Long-term annual earnings per share growth is projected at 6-8%, with dividend growth expected at 4-6% [7] Investment Plans - Xcel Energy plans to invest $60 billion from 2026 to 2030 to further enhance its infrastructure [9]