8-K: Eversource Energy Reports Q2 2026 Results

Eversource Energy announced second quarter 2026 GAAP earnings of $53.7 million, or $0.14 per share, a decrease from $352.7 million, or $0.96 per share, in the prior year, impacted by significant charges.

Summary

• Eversource Energy reported GAAP earnings of $53.7 million ($0.14 per share) for Q2 2026, down from $352.7 million ($0.96 per share) in Q2 2025.
• For the first half of 2026, GAAP earnings were $660.5 million ($1.75 per share), compared to $903.5 million ($2.45 per share) in the same period of 2025.
• Non-GAAP recurring earnings for Q2 2026 were $329.1 million ($0.87 per share), and $979.8 million ($2.60 per share) for the first half of 2026.
• The Q2 2026 GAAP results include a $111.4 million charge for the sale of Aquarion Water Company and a $164.0 million charge related to an increase in offshore wind contingent liability.
• The first half of 2026 GAAP results also include a $43.9 million charge related to an FERC decision reducing the return on equity for New England transmission owners.
• The company reaffirms its 2026 non-GAAP recurring earnings guidance of $4.57 to $4.72 per share and a long-term EPS growth rate of 5-7% through 2030.

Sentiment

Score: 3

Explanation: StockSavvy.ai views this filing as having a negative sentiment due to the significant year-over-year decline in reported earnings and the impact of substantial charges, despite positive strategic moves and reaffirmed long-term guidance.

Positives

• Completed the strategic divestiture of Aquarion Water Company, strengthening the balance sheet.
• Preliminary selection by ISO-NE to develop critical transmission infrastructure, bringing power from northern Maine to southern New England.
• Reaffirmed long-term earnings per share growth rate of 5-7% through 2030.
• Electric distribution segment earnings increased to $170.4 million in Q2 2026 from $161.5 million in Q2 2025, driven by rate increases.
• Natural gas distribution segment earnings improved in the first half of 2026 to $325.1 million from $253.7 million in the prior year, due to rate increases.
• Moody's outlook on the company was changed to stable.
• Received the HIRE Vets Platinum award for veteran employment and named one of America's Climate Leaders.

Negatives

• GAAP earnings per share decreased significantly in Q2 2026 to $0.14 from $0.96 in Q2 2025.
• GAAP earnings per share for the first half of 2026 decreased to $1.75 from $2.45 in the prior year.
• Significant non-cash charges impacted GAAP results, including $111.4 million for the sale of Aquarion and $164.0 million for offshore wind liabilities.
• A $43.9 million charge was incurred due to an FERC decision reducing the return on equity for transmission owners.
• Electric transmission segment earnings decreased by $24.3 million in Q2 2026 compared to Q2 2025.
• Natural gas distribution segment earnings decreased in Q2 2026 compared to Q2 2025 due to the absence of a prior year benefit.

Risks

• Variability in the costs and final investment returns of the Revolution Wind and South Fork Wind offshore wind projects.
• Potential for extreme weather events due to climate change impacting operations.
• Cyber events or breaches affecting company systems or third-party systems.
• Changes in laws, regulations, or regulatory policy that may impact compliance costs.
• Substandard performance of third-party suppliers and service providers.
• Limits on access to, or increases in, the cost of capital.
• Uncertainty surrounding the final resolution of the FERC ROE decision and related refund timing and amounts.

Future Outlook

Eversource Energy reaffirms its 2026 non-GAAP recurring earnings guidance of between $4.57 and $4.72 per share. The company also reaffirms its cumulative long-term earnings per share growth rate within the range of 5 to 7 percent through 2030, using the adjusted 2026 non-GAAP earnings guidance midpoint of $4.65 per share as the base year. Eversource expects annual earnings growth towards the upper half of its long-term guidance by 2028.

Management Comments

• "During the second quarter, we completed our strategic divestiture of Aquarion Water, further strengthening our balance sheet and positioning Eversource for continued success as a pure-play regulated electric and natural gas delivery company."
• "We are very pleased that the incumbent utilities have been selected for this important project."
• "As we enter the second half of the year, our priorities remain clear: operating safely and efficiently, delivering reliable service to our customers, executing on our strategic investments and maintaining the financial strength that supports long-term value creation."

Industry Context

StockSavvy.ai notes that Eversource Energy's strategic shift to a pure-play regulated electric and natural gas delivery company, evidenced by the Aquarion Water sale, aligns with industry trends favoring focused utility operations. The preliminary selection for the ISO-NE transmission project highlights the company's role in critical regional energy infrastructure development.

Comparison to Industry Standards

• The reported GAAP EPS of $0.14 for Q2 2026 is significantly lower than the $0.96 reported in Q2 2025, indicating a substantial year-over-year decline in reported profitability.
• The non-GAAP recurring EPS of $0.87 for Q2 2026, while higher than GAAP, still reflects a decrease from the prior year's comparable non-GAAP figures (though exact prior year non-GAAP EPS is not directly stated in this excerpt, the GAAP comparison suggests a challenging quarter).
• The company's reaffirmed long-term EPS growth target of 5-7% is a standard benchmark for regulated utilities, aiming for consistent, predictable growth.
• The FERC decision to reduce the return on equity for transmission owners from 10.57% to 9.57% is a significant regulatory event that impacts profitability for transmission assets across the industry in the region.

Legal Proceedings

• Eversource and other transmission owners have filed multiple motions against the FERC order reducing the base ROE.
• A refund extension has been granted through May 2027 for the FERC ROE decision.
• A motion for stay has been filed at the D.C. Circuit Court concerning the FERC ROE decision.
• A Section 205 filing has been made for a new base ROE of 11.39%.

Stakeholder Impact

• Shareholders may be impacted by the decrease in reported earnings per share.
• Customers may benefit from rate relief related to the securitization of storm costs in Connecticut.
• The selection for the ISO-NE transmission project indicates continued investment and operational focus, potentially impacting employees and suppliers involved in these projects.

Next Steps

• Eversource Energy will webcast a conference call with financial analysts on July 31, 2026, to discuss financial performance.
• The company is awaiting decisions from FERC and the D.C. Circuit Court regarding the transmission ROE refund.
• The CL&P Rate Case filing is expected to have a decision mid-2027.
• The company is proceeding with its capital investment plan of $26.5 billion through 2030.

Key Dates

Recommendation

The company's reported Q2 2026 results are significantly weaker than the prior year due to substantial charges, which is a negative. However, the strategic divestiture of Aquarion, the selection for a major transmission project, and reaffirmed long-term growth guidance provide some stability. The ongoing legal proceedings related to FERC ROE add uncertainty. Given the mixed signals, a 'hold' recommendation is appropriate pending further clarity on the impact of charges and regulatory outcomes.

Keywords

Eversource Energy, Q2 2026 Earnings, GAAP Earnings, Non-GAAP Earnings, Aquarion Water Sale, Offshore Wind Liability, FERC ROE, Transmission Infrastructure