Portland General Electric Q1 Earnings Call Highlights

Key Points

• Portland General Electric reported Q1 GAAP net income of $45 million ($0.38/share) and non‑GAAP net income of $68 million ($0.58/share) and is reiterating its full‑year guidance of $3.33–$3.53/share with long‑term earnings and dividend growth of 5%–7%.
• Load patterns shifted markedly as industrial demand rose 10% while residential load fell 6.2%, prompting a move toward a dual‑peaking profile and a revised expectation of 2026 weather‑adjusted load growth of 1.5%–2.5%.
• Key regulatory and strategic developments: the HoldCo review schedule was modestly extended with the Transco component paused, a pending Oregon order would raise data‑center rates by 26%, and a Washington acquisition is targeted to close mid‑2027 and is expected to be accretive.

Portland General Electric NYSE: POR reported first-quarter 2026 GAAP net income of $45 million, or $0.38 per diluted share, and non-GAAP net income of $68 million, or $0.58 per share, as the utility worked through unusually warm winter conditions and shifting customer usage patterns. President and CEO Maria Pope said the quarter reflected “another stretch of warm winter weather, 10% year-over-year industrial customer demand growth, and continued maturity of our cost management initiatives.”

Pope said the company’s non-GAAP results excluded previously disclosed deferral adjustments tied to January 2024 storm restoration and a Reliability Contingency Event, as well as business transformation, optimization, and acquisition expenses. She added that mild weather in February and March reduced seasonal usage from residential and small commercial customers.

Despite the weather-related headwinds, Pope said Portland General Electric is “reiterating our full year earnings guidance of $3.33-$3.53 per diluted share and our long-term earnings and dividend growth guidance of 5%-7%,” citing operational execution and an accelerated focus on cost management.

Load trends shift as industrial demand grows

Senior Vice President of Finance and CFO Joe Trpik said total first-quarter 2026 loads were flat compared to the first quarter of 2025, with “changes in demand between our customer classes largely offsetting.” Industrial demand rose 10% on both a nominal and weather-adjusted basis, while commercial load declined 2.9% (2.3% weather-adjusted) and residential load fell 6.2% (4.6% weather-adjusted).

Trpik attributed part of the residential and small commercial shift to longer-term trends including rooftop solar adoption and energy efficiency. He said the region is transitioning away from being winter-peaking toward a “dual-peaking profile,” with increasing summer cooling demand as air conditioning penetration rises. After incorporating recent usage trends, Trpik said the company now expects 2026 weather-adjusted load growth of 1.5% to 2.5%.

On the call, Trpik also said the company evaluated whether broader economic conditions were affecting demand, but concluded the quarter’s load patterns were primarily driven by unusual weather. Pope told analysts that customer growth remains “quite strong,” particularly outside downtown areas, and highlighted continued business formation and investment activity in data centers, high-tech, and semiconductor manufacturing.

Earnings drivers and cost actions

Trpik walked through quarter-over-quarter earnings drivers, noting a $0.07 increase in retail revenues, including a $0.09 benefit from additional cost recovery “largely from the inclusion of our Seaside battery asset in customer rates beginning in November 2025.” He also cited a $0.09 increase from higher industrial demand, offset by a $0.11 headwind from lower residential demand.

Power costs reduced results by $0.15, which Trpik said reflected a $0.09 impact from prior-year power cost performance that reversed in the year-over-year comparison and $0.06 from current-year power cost performance tied to less favorable wholesale and environmental credit market conditions. Other capital and financing costs lowered results by $0.16, driven by higher depreciation and amortization, dilution, and interest costs. Trpik also noted a $0.09 decrease from “other items,” primarily timing of tax credits and O&M costs.

Trpik said GAAP results included a $0.10 benefit from deferral reductions related to the January 2024 storm and reliability event following a final Oregon Public Utility Commission order received in March, and a $0.10 headwind from business transformation, optimization expenses, and acquisition costs.

Looking ahead, Trpik said first-quarter results were $0.25 below company expectations, with $0.09 of that difference driven by timing. He said management plans to address the remainder through incremental cost management measures, including refining capital and maintenance workstreams, optimizing management of teams, equipment, and facilities, and positioning the power portfolio and generation fleet “to deliver optimal value.”

Trpik said the company believes the savings are achievable, pointing to $25 million saved last year, momentum embedded in the 2026 plan, and an opportunity to accelerate elements originally planned for 2027 into 2026.

Regulatory priorities: HoldCo filing, rate tools, and data center tariff

Pope said the company is engaging with regulators to explore frameworks that could reduce the volatility of weather-driven revenue swings and power costs. “Greater predictability is good for both customers and shareholders,” she said, while cautioning it would be “multi-year work.” In response to questions about recovery tools after the Reliability Contingency Event mechanism is no longer available, Pope said the company is working with regulators to reduce volatility and address exposure to power costs, calling it “really important” work that will take time.

On the company’s holding company (HoldCo) proposal, Pope said the procedural schedule has been “modestly extended.” To prioritize resolution of the HoldCo matter, she said Portland General Electric has paused the transmission company (Transco) component for now, though “formation of a transmission company remains part of our long-term strategy.” Pope said the process remains on course with a target final order date “probably in August.”

In the Q&A, Pope told Jefferies analyst Julien Dumoulin-Smith that parties had aligned on “bundled general provisions around ring fencing, including Commission’s oversight, access to books and records,” but remained “pretty far apart with regards to credit, the use of leverage, and other such things.” She added that settlement discussions remain part of the process, and she expressed expectations that a settlement is still achievable.

Separately, Pope said Portland General Electric’s proposed large load tariff for data centers (UM 2377) is in the final stages of review at the Oregon commission, with an order expected in the next several weeks. She said the rate structure under consideration, enabled by recent Oregon legislation, includes a 26% increase in data center prices to help reduce costs borne by residential and small business customers. In response to a question from Morningstar’s Travis Miller, Pope said the 26% increase would apply to both existing and new data center customers, adding that the company worked “very collaboratively” with those customers and that there were “no surprises.”

Pope also addressed multi-year rate planning in Oregon, saying stakeholders need a common understanding of “tools that will provide for adequate capital recovery” and interim mechanisms during the transition. Trpik cited examples of evolving regulatory tools, including the Seaside Tracker and a DSP process, describing the shift as an evolution from a traditional framework to multi-year planning.

Washington acquisition and capital plan updates

Pope said the company filed applications in late March and early April with the Washington Utilities and Transportation Commission and the Oregon Public Utility Commission for approval of the “Washington transaction,” and it continues to target a mid-2027 close. She said the regulatory approval process is expected to take about a year.

Asked about stakeholder feedback, Pope said the company has engaged with commissioners and staff in both states, as well as governor’s offices, and said she was encouraged by receptivity in the service territory and interest in economic development and load growth in areas including Walla Walla, Wallula, and Yakima. She characterized Washington as a “constructive, business-focused environment.”

In discussing the Washington business, Pope said the company expects the acquisition to be accretive in the first year and to enhance long-term EPS and dividend growth, driven in part by clean energy investments needed for compliance with the Clean Energy Transformation Act. Pope said the company would expect to achieve a return profile in Washington “similar” to Oregon “or better.” Trpik added that what the company has observed historically as a gap has been “mainly related to power costs,” and he said the transaction would bring “a much more specific and transparent direction of costs for the Washington customers,” which he said should improve recovery over time.

On capital planning, Trpik presented a five-year forecast that includes 2026 and 2027 spending for projects from the 2023 request for proposals, but he noted it does not contemplate capital expenditures from the ongoing 2025 RFP or the Washington utility acquisition. In response to UBS, Trpik said the company typically includes RFPs in its plan once projects are under contract, and he said the earliest contracts for the 2025 RFP could arrive in early 2027, depending on negotiations and process timing.

Pope also said the company filed a final shortlist with the Oregon commission for its 2025 RFP as it aims to procure approximately 2,500 MW, describing the shortlist as a diverse mix of technologies and projects. She also pointed to ongoing wildfire mitigation planning, noting that the company filed a 2026-2028 wildfire mitigation plan that moves to a three-year framework. Pope said Oregon regulators and policymakers are studying wildfire liability policy options, with findings expected to inform policymakers ahead of the 2027 legislative session.

Liquidity, financing, and dividend

Trpik said total liquidity at quarter-end was $954 million, and the company’s investment grade credit ratings were unchanged. He said Portland General Electric expects its 2026 cash flow from operations to debt metric to be above 19%.

During the quarter, the company executed a $550 million equity forward “to address our 2026 base equity needs and fund the 2023 RFP project,” Trpik said. The company also entered into two unsecured credit agreements: a $350 million term loan maturing in March 2028 to fund capital expenditures and general corporate needs, and a $680 million delayed draw term loan intended to finance the Washington acquisition and related costs, available until certain acquisition milestones are achieved and maturing 364 days after funding.

Trpik also noted the board declared a quarterly common stock dividend of $0.55125 per share in April, representing a 5% increase on an annualized basis. He said the company remains committed to a dividend aligned with its 60% to 70% payout target while balancing financing needs.

In closing remarks, Pope said the company remains focused on operational performance, meeting growing energy demand, expanding into Washington, and advancing clean energy investments, while working to deliver on its reaffirmed guidance.

About Portland General Electric NYSE: POR

Portland General Electric NYSE: POR is an investor-owned electric utility headquartered in Tigard, Oregon, with roots tracing back to the late 19th century. The company generates, transmits and distributes electricity to residential, commercial and industrial customers across a broad territory in Oregon, primarily encompassing the Portland metropolitan area and surrounding regions.

As one of Oregon's largest electric utilities, Portland General Electric operates a diverse portfolio of generation assets, including hydroelectric facilities, natural gas–fired plants and renewable energy sources.

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