Public Service Enterprise Group Q3 Earnings Call Highlights

Key Points

• PSEG reaffirmed its outlook after reporting third-quarter 2026 non-GAAP operating earnings of $1.15 per share, up from $1.13 a year earlier. The company maintained its full-year guidance of $4.28–$4.40 per share and 6%–8% annual earnings growth through 2030.
• PSE&G invested approximately $1.1 billion in the quarter and remains on track for $4.2 billion of regulated capital spending in 2026, supported by energy-efficiency and transmission investments. New Jersey regulators also approved customer bill reductions and recovery for infrastructure and electric-vehicle program investments.
• PSEG Power’s operating earnings improved as higher generation and capacity prices, strong nuclear output, and lower maintenance costs offset a reported segment net loss. Management is also exploring large-load customer agreements, nuclear uprates, and additional nuclear development while maintaining sufficient liquidity to fund its capital plan without issuing equity.

Public Service Enterprise Group NYSE: PEG reported third-quarter 2026 net income of $0.76 per share and non-GAAP operating earnings of $1.15 per share, compared with $1.24 per share and $1.13 per share, respectively, in the prior-year quarter.

For the first nine months of 2026, the company recorded net income of $2.91 per share and non-GAAP operating earnings of $3.56 per share. PSEG reaffirmed its full-year non-GAAP operating earnings guidance of $4.28 to $4.40 per share and its five-year earnings growth outlook of 6% to 8% through 2030.

Chair, President and CEO Ralph LaRossa said the company's quarterly and year-to-date performance was in line with expectations, supported by utility investment and improved PSEG Power results.

Utility investment and regulatory developments

At PSE&G, continued spending on energy-efficiency programs and transmission contributed to utility margin growth, according to LaRossa. Those gains were offset by higher depreciation, interest expense and the timing of taxes.

Executive Vice President and CFO Dan Cregg said depreciation and interest expense each increased by $0.01 per share year over year because of capital investment, incremental debt and the refinancing of maturing debt at higher long-term rates. Taxes and other items had a net unfavorable impact of $0.04 per share, primarily due to tax timing.

PSE&G invested approximately $1.1 billion during the third quarter and remains on track to spend about $4.2 billion in regulated capital investments during 2026. The company maintained its five-year regulated capital spending plan of $22.5 billion to $25.5 billion through 2030.

The New Jersey Board of Public Utilities approved several regulatory items during the quarter, including a 5% reduction in residential gas bills effective Oct. 1, 2026. The board also approved recovery for investments under PSE&G's Infrastructure Advancement Program and Clean Energy Future-Electric Vehicle Program, resulting in annual revenue increases of $14 million and $8 million, respectively.

LaRossa said PSE&G expects to make a proposal to the BPU addressing regulatory lag associated with capital investments since its last distribution rate case. He did not provide details, saying the company intends to remain aligned with the Sherrill administration's affordability agenda and goal of keeping rates flat for as long as possible.

The company also filed its Clean Energy Future EE 2.5 proposal in late September. PSEG said its energy-efficiency programs have generated more than $1 billion in annual customer savings and helped nearly 525,000 residential and business customers save energy since October 2020.

Storm response and operational performance

LaRossa said severe weather during the quarter tested PSE&G's electric and gas systems. A September nor'easter affected about 70,000 electric customers, but nearly all were restored within 24 hours despite tree damage and difficult conditions. PSE&G's gas operations had no storm-related customer outages during the multiday event.

PSEG Long Island is on track for its most reliable year on record under the Long Island Power Authority operating-service-management model, LaRossa said, adding that customer satisfaction measures continue to improve.

The company noted that PJM prospectively reduced wholesale transmission rates for PSE&G customers following a Federal Energy Regulatory Commission ruling on transmission cost allocation. PSEG expects to file in early 2027 to credit the resulting dollars back to retail customers.

Power segment benefits from nuclear output and pricing

PSEG Power and Other reported a third-quarter net loss of $130 million, compared with net income of $107 million a year earlier. However, non-GAAP operating earnings for the segment increased to $68 million from $50 million.

Cregg attributed the improvement in operating earnings to a $0.04-per-share increase in net energy margin from higher generation and capacity prices and gas operations. Operations and maintenance expense declined by $0.02 per share, aided by the absence of a refueling outage and fuel-cycle extension work at the company's Hope Creek nuclear unit in the prior-year period.

PSEG's nuclear fleet generated approximately 8.2 terawatt-hours in the quarter, with a 95.5% capacity factor. Salem Unit 1 entered its fall refueling outage after a 491-day breaker-to-breaker run, matching a similar run by Salem Unit 2 earlier in the year.

The company said its 2027 portfolio position is expected to result in realized nuclear generation values above the level needed to receive the nuclear production tax credit. Management declined to offer a forecast for 2028 pricing, pointing instead to supply-demand conditions and the pace of new generation development.

During the call, executives emphasized that PSEG's nuclear output is priced at the PECO zone, rather than PJM Western Hub. While the differential between the two pricing hubs has recently widened, Cregg said the company uses direct hedges, financial transmission rights, swaps and options to manage its overall position.

Large-load, nuclear and financing outlook

LaRossa said PSEG continues discussions with large-load customers regarding contracting arrangements involving existing nuclear generation, future nuclear uprates and other generation opportunities. The company said such arrangements could provide supply certainty for large-load customers while supporting economic development in New Jersey and the broader region.

PSE&G's large-load inquiries have remained near the roughly 11.8-gigawatt level previously disclosed as of December 2025, LaRossa said. He characterized the interest as primarily “edge computing” opportunities rather than large hyperscale data centers.

Management said Salem nuclear uprates are included in the company's current five-year plan and are expected to be online by the end of that period. PSEG also participated in the first meeting of New Jersey's Nuclear Task Force in October and continues to support potential new nuclear development at its Salem County site.

PSEG ended September with $3.9 billion in available liquidity, including more than $830 million in cash. During the quarter, PSE&G issued $1 billion of secured medium-term notes, while PSEG Power issued $400 million of five-year senior notes. Cregg said the company's balance sheet supports its regulated capital plan without the need to issue new equity or sell assets.

About Public Service Enterprise Group (NYSE:PEG)

Public Service Enterprise Group Incorporated NYSE: PEG, commonly known as PSEG, is an energy company headquartered in Newark, New Jersey. Through its subsidiaries, the company is primarily involved in electric and natural gas utility operations, power generation, and related energy services.

Public Service Electric & Gas Company (PSE&G), PSEG's principal utility subsidiary, serves residential, commercial, and industrial customers throughout New Jersey. Its activities include the transmission and distribution of electricity, the distribution of natural gas, energy-efficiency programs, and infrastructure modernization.

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