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Evergy (EVRG) Q2 FY26 earnings call: guidance and Q&A

Earnings call· Jun 2026 (Q2 FY26)· Utilities· Aug 6, 2026

Source: earnings call transcript

Executive summary

Evergy Q2 FY26 — Strong Data Center Load Growth Drives EPS and Capital Plan Upside

Evergy delivered solid Q2 FY26 results, driven by strong data center load growth and regulated investment recovery, reaffirming its full-year adjusted EPS guidance. The company significantly expanded its capital plan to support 3 GW of contracted large load, projecting a 12% rate base CAGR and long-term EPS growth exceeding 8% from 2028. Management remains focused on affordability, leveraging large load tariffs to benefit all customers while addressing specific infrastructure needs in Missouri West.

Highlights

5

  • Q2 adjusted EPS of $0.88, up from $0.82 YoY.

  • Reaffirmed full-year 2026 adjusted EPS guidance midpoint of $4.24.

  • Secured 3 GW of large load (data center) demand, driving 7-8% annual retail load growth through 2030.

  • Increased capital investment plan by $1 billion to $21.6 billion, raising rate base CAGR to 12% through 2030.

  • Utilized ATM program, pricing $425 million in forward equity sales, addressing over half of the year's equity needs.

Concerns

3

  • Higher operations and maintenance, depreciation, and interest expense partially offset Q2 EPS gains, resulting in an $0.08 decrease.

  • Missouri West customers may experience rate increases above inflation over the next 5 years due to infrastructure investment needs.

  • $0.02 dilution from convertible bonds in Q2.

Guidance & targets

CategoryTargetConfidence
Full-year 2026 Adjusted EPS
$4.14 to $4.34 per share
high materiality
High
Long-term Adjusted EPS Growth Target
6% to 8% plus
high materiality
High
Annual Adjusted EPS Growth
exceed 8% annually
high materiality
High
Q3 Adjusted EPS
50% to 53% as measured against the $4.24 midpoint of our 2026 adjusted EPS guidance range
medium materiality
High
Retail Load Growth CAGR
approximately 7% to 8%
high materiality
High
Capital Investment Plan
$21.6 billion
high materiality
High
Incremental Capital Investment
approximately $1 billion
high materiality
High
Rate Base CAGR
approximately 12%
high materiality
High
FFO to Debt Ratio
14% to 15%
medium materiality
High
Equity Issuance
$700 million to $900 million
medium materiality
High
Residential Customer Rate Increases (Majority)
in line with or below inflation
medium materiality
High
Missouri West Residential Customer Rate Increases
above inflation
medium materiality
Medium

Orderbook & backlog

Contracted Large Load Capacity (ESAs & other) 3 GW Q2 FY26

Includes 2.5 GW from 5 executed ESAs and 500 MW from non-LLPS large customers (e.g., Panasonic). Projects already in operation or progressing towards steady state (1.3 GW) and additional projects with executed ESAs (1.7 GW) with 16-17 year minimum monthly bill provisions.

Large Load Expansion Opportunities 2.0 to 2.5 GW Q2 FY26

up from 1 to 1.5 GW last quarter

Opportunities at or adjacent to existing customer sites; not incorporated in 5-year financial plan, potential upside near-term and into 2030s.

Tier 2 New Customer Opportunities 1 to 2 GW Q2 FY26

Advanced discussions with customers who have acquired land/rights and signed letters of agreement; primarily beyond 2030.

Remaining Large Load Pipeline well over 10 GW Q2 FY26

Highlights robust activity and sustained interest; serving this load requires creative solutions and prioritization.

Deals & partnerships

Google Energy Supply Agreement (ESA) for data center load 16 to 17 years

Two ESAs with Google for data center projects under LLPS tariffs.

Meta Energy Supply Agreement (ESA) for data center load 16 to 17 years

One ESA with Meta for a data center project under LLPS tariffs.

Digital Realty Energy Supply Agreement (ESA) for data center load 16 to 17 years

One ESA with Digital Realty, a data center developer, for a project under LLPS tariffs.

Bell Energy Supply Agreement (ESA) for data center load 16 to 17 years

One ESA with Bell, an enterprise with experience in data centers, for a project under LLPS tariffs.

Panasonic Ramp-up of operations for existing large customer

Continued ramp of operations for Panasonic, contributing to industrial demand growth.

Capital programs

Multi-year Capital Investment Plan underway $21.6 billion
Funding: prudent mix of debt and equity financing
Start: FY26

Benefit:Supports 12% rate base CAGR through 2030; includes over 5 GW of new generation resources through 2032.

Consistent with February 2026 CapEx plan, with $1 billion incremental capital for generation resources to serve secured customer agreements.

Kansas Generation Resource Additions planned

Benefit:New natural gas plant, a solar farm, and a battery storage facility.

Planned for predetermination application filing later this year, consistent with 2026 IRP preferred plan.

Missouri Generation Resource Additions planned

Benefit:New natural gas plant, a solar farm, and a battery storage facility.

Related to an upcoming Certificate of Convenience and Necessity Request (CCN).

Mullen Creek #2 Facility pending CCN request

Benefit:440-megawatt simple cycle gas turbine

Located in Notaway County, Missouri. STAT report due September 15, settlement conference September 22, hearings beginning October 19.

Risks & headwinds

Higher Operations and Maintenance, Depreciation, and Interest Expense Q2 FY26

$0.08 per share decrease in Q2 FY26 adjusted EPS

Dilution from Convertible Bonds Q2 FY26

$0.02 per share decrease in Q2 FY26 adjusted EPS

Missouri West Rate Increases Above Inflation next 5 years

rate increases above inflation

Mitigation:Investments will reduce reliance on market-provided energy, making rates more stable; rates will remain regionally competitive.

Political Sensitivity/Moratoria Campaigns on Data Centers ongoing

discussed_not_quantified

Mitigation:Working with high-quality developers who understand community receptiveness; both Kansas gubernatorial candidates supportive of economic development; LLPS tariff ensures fair share payment.

Lag between Investments and Earnings Realization long-term

250 basis point delta between rate base growth and EPS growth

Mitigation:Steady load growth helps maintain a stable relationship; annual guidance provided as specific projects come online.

What to watch in Q3 FY26

Additional ESA signing

2026 (by Q3 call in November)
Current 5 ESAs signed, 3 GW total load
Target At least 1 additional ESA signed

Why it matters

Signals continued momentum in data center growth and potential for further capital plan upside.

We continue to make progress towards agreements on expansion projects and are highly confident that we'll execute at least 1 more ESA in 2026. We anticipate providing more details on our third quarter call in November.

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Q&A highlights

Analyst asked for more detail on the generation and capital requirements for potential new ESA signings this year and how that would impact rate base growth beyond the current 12% CAGR.

David Campbell explained that the 2-2.5 GW expansion opportunities at existing sites and 1-2 GW from Tier 2 customers represent meaningful upside, primarily beyond 2030. He confirmed that new ESAs would drive incremental capital, mainly for generation, and that most customers seek firm power. He noted that the company expects to sign at least one more ESA in 2026, which would lead to further capital requirements.

“To serve incremental load, we do expect that there are going to be additional resource requirements, primarily generation-related. We're seeing cost trends that are in line with what you're seeing for other utilities. So the capital investment that would follow is pretty meaningful. So it would drive, we expect incremental CapEx.”

asked by Stephen D’Ambrisi · answered by David Campbell

2 min read 6 chapters

Detailed narrative

Q2 Performance and Full-Year Outlook

Evergy reported Q2 adjusted EPS of $0.88, up from $0.82 in Q2 2025, driven by regulated investment recovery and large load customer revenues. This performance keeps the company on track for the midpoint of its full-year 2026 adjusted EPS guidance of $4.24. The company also reaffirmed its long-term adjusted EPS growth target of 6% to 8% plus through 2030, with growth expected to exceed 8% annually from 2028.

Transformative Data Center Growth

The company has executed ESAs for 5 data center projects, totaling 2.5 GW of steady-state peak load, which combined with other large customers, reaches 3 GW. This demand is expected to drive 7-8% annual retail load growth through 2030. An additional 2.0-2.5 GW of expansion opportunities exist at or adjacent to current sites, and 1-2 GW from new Tier 2 customers are in advanced discussions, primarily impacting beyond 2030.

Capital Investment and Resource Additions

Evergy's capital investment plan has increased by $1 billion to $21.6 billion over the next 5 years, primarily for generation resources to serve contracted load. This raises the rate base CAGR to 12% through 2030. The 2026 IRP preferred plan includes over 5 GW of new additions through 2032, comprising 3.9 GW of natural gas, 800 MW of solar, and 450 MW of battery storage, reflecting an "all-of-the-above" approach for reliability and affordability.

Regulatory Initiatives

In Kansas, Evergy plans to file a predetermination application for a new natural gas plant, a solar farm, and a battery storage facility later this year. In Missouri, the metro rate case is progressing with rebuttal testimony due August 11 and settlement conferences starting September 23. Separately, a CCN request for a new natural gas plant, solar farm, and battery facility, as well as the Mullen Creek #2 facility (440 MW simple cycle gas turbine), are also underway.

Customer Affordability and Rate Competitiveness

Evergy emphasizes its commitment to affordability, noting that average residential customer rates are below national and Midwest averages. The large load tariff framework ensures new large customers pay their fair share, helping to spread system costs and protect existing customers. While most residential rates are expected to rise in line with or below inflation, Missouri West customers may see increases above inflation due to needed infrastructure investments.

Financing Strategy

To support its growing capital plan and maintain strong investment-grade credit ratings, Evergy projects FFO to debt in the 14-15% range from 2026-2028. The company has already priced approximately $425 million through forward sales agreements via its ATM program, covering over half of the $700 million to $900 million equity expected to be issued in 2026, with no plans for a block issuance.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.