Exelon Q1 Earnings Call Highlights

Key Points

• Exelon reported Q1 adjusted operating EPS of $0.91 and reaffirmed full-year guidance of $2.81–$2.91, saying results were aided by net favorable weather and timing-related items.
• The company unveiled a revised four-year capital plan of $41.7 billion that rebalances spending toward transmission (including $1.5 billion incremental transmission investment and $1.1 billion distribution deferrals), while maintaining 7.9% annualized rate-base growth and targeting ≤2% O&M growth plus $350 million of incremental O&M savings in 2027.
• Regulatory actions included withdrawing recently filed PECO rate cases for affordability reasons, ongoing Pepco Maryland and Delmarva proceedings, and management warned that generation supply shortages and PJM interconnection backlogs are driving the need for more transmission and policy solutions.

Exelon NASDAQ: EXC reported first-quarter 2026 adjusted operating earnings of $0.91 per share, with management saying results exceeded expectations due primarily to “net favorable weather and timing-related items,” while reaffirming full-year guidance of $2.81 to $2.91 per share.

On the company’s earnings call, President and CEO Calvin Butler said 2026 performance “remains on track both financially and operationally,” and emphasized that Exelon’s utilities maintained strong reliability through several high-wind and storm events. Butler said all operating companies posted top-quartile reliability performance during the quarter, with ComEd ranking in the top decile.

Guidance reaffirmed as weather and timing aided Q1

Chief Financial Officer Jeanne Jones said first-quarter adjusted operating earnings of $0.91 per share compared with $0.92 per share in the same period of 2025. Jones attributed the year-over-year decline primarily to items including ComEd timing “due to revenue shaping in 2025,” higher interest expense at Corporate and PECO, higher credit loss expense at BGE, and Pepco Maryland’s multi-year plan reconciliation following a final order received in March. Those headwinds were partially offset by new distribution and transmission rates and favorable weather at PECO, Jones said.

Looking ahead, Jones said Exelon expects second-quarter earnings to be approximately 15% of the midpoint of the company’s full-year guidance range, assuming normal weather and storm activity and incorporating anticipated revenue shaping and timing. Combined with first-quarter results, Jones said that would result in recognizing 47% of projected full-year earnings in the first half of the year, which she said aligns with seasonal shaping in prior years.

Capital plan rebalanced toward transmission; cost actions outlined

Jones said Exelon updated disclosures around its multi-year plan and continues to expect adjusted operating earnings growth “near the top end” of its 5% to 7% range through 2029. She described a revised four-year capital plan totaling $41.7 billion, including nearly $10 billion of planned investment in 2026.

According to Jones, the revised capital plan includes $1.1 billion of project deferrals and reductions in PECO and BGE distribution, alongside $1.5 billion of incremental transmission investment. She said the additional transmission spending is tied to project realignment and interconnection needs for data center customers that have signed Transmission Security Agreements.

Despite the rebalance, Jones said Exelon is maintaining revised annualized rate base growth of 7.9% over the next four years. She added that Exelon now anticipates transmission rate base growing 16% through 2029 and maintained prior “upside guidance” of $12 billion to $17 billion, noting the figure does not include recent competitive transmission bids in MISO or potential solar and storage opportunities.

On costs, Jones said Exelon is targeting adjusted O&M growth of no more than 2% through 2029, following nearly flat expense growth from 2024 through 2026. Butler and Jones both pointed to $350 million of incremental O&M savings in 2027 tied to work the company “will no longer pursue,” with Jones saying the revised plan includes actions such as accelerating AI and technology transformation, prioritizing IT projects, reducing outside contractors, using a managed hiring process, and offering a targeted voluntary separation program later in 2026.

Regulatory focus: PECO withdraws rate cases; Maryland and Delaware proceedings continue

Butler said the quarter included “important regulatory and legislative developments,” particularly in Pennsylvania and Maryland. At PECO, he said the company made a “deliberate, timing-based decision” to withdraw recently filed electric and gas rate cases, citing customer affordability and stakeholder feedback. Butler said the move does not change Exelon’s commitment to safety, reliability, or long-term infrastructure investment, and described it as an example of adjusting timing and reallocating capital while balancing near-term affordability and longer-term system needs.

During Q&A, Butler reiterated that the Pennsylvania decision followed discussions with stakeholders who said “timing is not the best right now.” He said Exelon is assessing future PECO filings with a focus on maintaining safe, reliable service and working collaboratively on “prudent” and appropriately timed investments.

Butler also addressed a letter from Pennsylvania Gov. Josh Shapiro, saying it centered on affordability and highlighted three themes: “the most cost-effective forms of capital,” transparency in rate-making, and “justifiable returns.” Butler said Exelon had already heard those points in discussions with the governor, and said the company has “no concern” with the principles and expects to continue operating through the state’s regulatory process.

Jones added that Exelon believes Pennsylvania’s regulatory process allows the company to build an evidentiary record supporting “a fair and reasonable return,” and emphasized the need for returns commensurate with utility risk and a capital structure that supports credit quality and lowers customer financing costs.

In Maryland, Butler said the Utility RELIEF Act passed the legislature and is awaiting Gov. Wes Moore’s signature. While he said Exelon shares the state’s affordability focus, Butler argued the legislation does not address what he described as a growing imbalance between energy demand and supply. Butler said residential supply costs in the Mid-Atlantic have risen “by up to 80% or more” over the past five years and argued that without new generation, affordability challenges will persist. He also referenced 2024 PJM warnings suggesting blackouts could occur “as soon as 2028 due to lack of supply.”

Jones also reviewed ongoing regulatory cases:

• Pepco Maryland: Jones said the company filed notice with the Maryland Public Service Commission to pursue a traditional base rate case filed last fall, requesting a $119.9 million revenue requirement. She said evidentiary hearings were held recently and a final order is expected in August.
• Delmarva Power (Delaware): Jones said the electric base rate case is progressing on schedule, with intervener testimony due at the end of October. She said Delmarva expects interim rates to take effect in July.

Supply, PJM market structure, and interconnection backlog

Butler repeatedly tied affordability to supply constraints, saying, “You cannot have a conversation about affordability without addressing the underlying shortage of generation.” He said Exelon is leaning into transmission investment where it has a clear mandate, while advocating for solutions in areas where it cannot currently participate, including utility-owned generation. Butler cited Maryland’s HB 1561 as an example of legislation intended to create a path for “utility-owned backstop generation,” particularly storage and renewables.

Butler said Exelon has focused on ensuring its data center pipeline is backed by FERC-approved Transmission Security Agreements, which he said have secured approximately $1 billion of collateral. He also contrasted customer costs with PJM outcomes, saying that over the last two years customers paid $32 billion to generators for capacity while supply declined by 1.2 gigawatts.

On interconnection, Chief Legal Officer Colette Honorable said PJM recently announced that 811 new generation projects capable of generating 220 gigawatts have applied to interconnect, and said PJM has reopened the queue. Honorable cautioned that “only 19% of the projects that are in the queue reach operation,” and said 54 gigawatts have been cleared but face delays tied to siting, permitting, and supply chain issues.

Butler also acknowledged increased advocacy around utility-owned generation in Pennsylvania, though he noted the state is in an election year with divided government, calling near-term legislative progress “a long shot.”

Financing progress and credit metrics targets

Jones said Exelon completed about 43% ($2.3 billion) of its planned 2026 long-term debt financing, executing expected debt transactions at both the corporate level and at Pepco Holdings Inc. She said the company continues to use pre-issuance hedging to manage interest rate volatility.

Through 2029, Jones said Exelon expects to fund a revised $47.417 billion capital plan with $21.8 billion of internally generated cash flow, $13.1 billion of utility debt, and $3.4 billion of holding company debt, with the remaining portion funded by $3.4 billion of equity. She said Exelon has already priced forward contracts under its ATM program covering all $850 million of 2026 equity needs and more than $400 million for 2027.

Jones said Exelon is targeting credit metrics of approximately 14% and aims to maintain financial flexibility above downgrade thresholds. In response to an analyst question, Jones noted that PECO was already on negative outlook and “on review for a downgrade,” while emphasizing Exelon’s broader diversified portfolio and balance sheet targets.

In closing remarks, Butler said Exelon expects to deploy about $10 billion of capital in 2026, earn a consolidated 9% to 10% ROE, and deliver full-year operating earnings within the reaffirmed guidance range, with a goal of achieving “midpoint or better.”

About Exelon NASDAQ: EXC

Exelon Corporation NASDAQ: EXC is a Chicago-based energy company that operates primarily as a regulated electric and natural gas utility holding company. The company's businesses focus on the delivery of electricity and related services to residential, commercial and industrial customers, as well as investments in grid modernization, customer energy solutions and demand-side programs. Exelon's operations emphasize reliable service delivery, infrastructure maintenance and regulatory compliance across its utility footprint.

Formed in 2000 through the merger of Unicom and PECO Energy, Exelon historically combined generation and regulated utility businesses.

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