Second Quarter 2026
Filed Jul 30, 2026NorthWestern Energy Reports Second Quarter 2026 Financial Results
Second-quarter GAAP and adjusted diluted EPS increased from 2025, supported primarily by new rates and retail volumes, while the company affirmed its 2026 non-GAAP EPS guidance and capital plan.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net incomeGAAP | $25.0 million | – | – |
| Diluted earnings per shareGAAP | $0.40 per diluted share | – | – |
| Non-GAAP net incomenon-GAAP | $31.1 million | – | – |
| Adjusted diluted non-GAAP earnings per sharenon-GAAP | $0.50 | – | – |
| Merger-related costsother | $3.3 million | – | – |
| Six-month merger-related costsother | $6.7 million | – | – |
2026 outlook
- Tax rateapproximately 14 percent to 18 percent
- NoteNon-GAAP earnings guidance of $3.68 - $3.83 per diluted share.
- NoteDiluted average shares outstanding of approximately 61.8 million.
- NoteLong-term diluted earnings per share growth guidance of 4% to 6%, based on our 2024 adjusted diluted non-GAAP EPS baseline of $3.40.
- Note$3.2 billion capital investment plan for 2026-2030.
- NoteRate base growth of 4% to 6% from our 2024 base year of approximately $5.4 billion.
- NoteRecord $683 million capital plan for 2026.
Capital returns
- Quarterly common stock dividend of $0.67 per share payable on September 1, 2026, to shareholders of record as of August 17, 2026.
- Targeted dividend payout ratio within the range of 60-70% over the long term.
What drove it
- The increase in net income was primarily due to new rates and retail volumes.
- The company completed acquisitions of Avista's and Puget's respective interests in Colstrip Units 3 and 4 on January 1, 2026.
- Development agreements with Sabey Data Centers, Atlas Power Holdings LLC, and Quantica Infrastructure are associated with an expected combined energy service requirement of 150 megawatts beginning in late 2027, with growth of up to approximately 1,500 megawatts or more by 2030.
- The company received merger approvals from FERC, the Nebraska Public Service Commission, and the South Dakota Public Utilities Commission.
Concerns
- Operating, administrative, and general costs included merger-related costs and costs associated with additional ownership interests in Colstrip Units 3 and 4.
- Depreciation expense and interest expense partly offset the benefit from new rates and retail volumes.
- Montana is the only remaining regulatory approval needed for the merger, and the company awaits the Montana Public Service Commission's final order.
- The MPSC's final order suspended the 90/10 cost sharing mechanism of the PCCAM on a temporary basis pending further review.
- The MPSC disallowed a portion of Yellowstone County Generating Station capital costs, resulting in a $30.9 million non-cash charge in the fourth quarter of 2025.
- Operating costs for the Colstrip interests are not currently reflected in utility customer rates until requested in a future Montana rate review.
What to watch
- The Montana Public Service Commission's final order on the merger and the expected closing by year-end 2026, subject to closing conditions.
- Final approval or denial of the PCCAM tariff waiver request within the ongoing PCCAM docket process.
- Potential modifications to the MPSC's Montana rate-review final order, which are expected to be reflected in 2026 results.
- Execution of electric service agreements and regulatory evaluation of resources and mechanisms for large data-center load requests.
- Expected equity issuances beginning in 2027 to fund South Dakota generation investment.
Analysis
NorthWestern reported improved second-quarter earnings versus the same period in 2025. GAAP net income was $25.0 million and diluted GAAP EPS was $0.40 per diluted share, compared with $21.2 million and $0.35 per diluted share. Non-GAAP net income was $31.1 million and adjusted diluted non-GAAP EPS was $0.50, compared with $24.1 million and $0.40. The company identified new rates and retail volumes as the primary sources of the improvement.
Cost offsets remain material. The release cited operating, administrative, and general costs, including merger-related costs and costs associated with additional ownership interests in Colstrip Units 3 and 4, as partial offsets. It also cited depreciation expense and interest expense. Merger-related costs included in administrative and general expenses were $3.3 million for the three months ended June 30, 2026, and $6.7 million for the six months ended June 30, 2026.
Management affirmed 2026 non-GAAP EPS guidance of $3.68 - $3.83 per diluted share. The outlook assumes normal weather, excludes costs related to the pending Black Hills merger, assumes approval of the PCCAM waiver and sufficient power prices to recover operating expense from incremental Avista and Puget Colstrip interests, and uses an effective income tax rate of approximately 14 percent to 18 percent. The company also affirmed its $3.2 billion capital investment plan for 2026-2030 and rate base growth of 4% to 6% from its 2024 base year of approximately $5.4 billion.
The merger remains central to the outlook. FERC, Nebraska, and South Dakota have approved the transaction, while Montana approval remains outstanding following a May hearing. Management anticipates closing by year-end 2026, subject to closing conditions. The company selected Bright Horizon Energy as the new corporate name for the resulting parent company.
Large-load development and Colstrip cost recovery are additional issues for investors to monitor. Development agreements with data-center counterparties are expected to require 150 megawatts beginning in late 2027, with potential growth of up to approximately 1,500 megawatts or more by 2030, but electric service agreements, resource evaluation, and regulatory considerations remain pending. The quarterly dividend of $0.67 per share was declared with a September 1, 2026 payment date, while management maintained its long-term dividend payout ratio target of 60-70%.
Management, verbatim
We are pleased to report solid results for the quarter and exciting progress on the merger.
Brian Bird, President and CEO
That leaves Montana as the only remaining regulatory approval needed for the merger.
Brian Bird, President and CEO
Not in the filing
stated, not guessed- Total revenue
- Prior-year and prior-quarter total revenue
- Segment revenue and segment comparisons
- Gross profit and gross margin
- Operating income and operating margin
- Operating expenses excluding disclosed merger-related costs
- Cash balance
- Debt balance
- Operating cash flow
- Free cash flow
- Capital expenditures for the reported quarter
- Share repurchases
- Revenue, gross-margin, and operating-expense guidance
- Prior outlook section for comparison with actual results
- Complete financial statements and remaining release text, as the supplied filing text ends mid-sentence on page 5
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.