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OGE Energy (OGE) Q1 FY26 earnings call: guidance and Q&A

Earnings call· Mar 2026 (Q1 FY26)· Utilities· Apr 29, 2026

Source: earnings call transcript

Executive summary

OGE Energy Corp. Q1 FY26 — Strong Foundation for Future Growth

OGE Energy reported a decline in Q1 FY26 earnings due to milder weather and O&M timing, but reaffirmed its full-year EPS guidance, signaling confidence in its financial plan. The company is laying a strong foundation for future growth, highlighted by formalizing contracts with Google for data centers and advancing significant generation and transmission projects. Management emphasized a disciplined strategy focused on customer affordability, prudent investment, and maintaining a strong balance sheet, with recent credit rating improvements validating their approach.

Highlights

5

  • Affirmed 2026 consolidated earnings guidance of $2.43 per share (range $2.38-$2.48), despite milder Q1 weather.

  • Filed long-term special contracts with Google for multiple data centers, ensuring customer protections and 100% cost recovery for connection and fair share of power.

  • Commissioned 98 MW Tinker power plant in February and expect 450 MW of new CTs at Horseshoe Lake online in Q4 FY26, contributing to 1.7 GW of capacity additions.

  • Moody's revised outlook for OGE Energy and OG&E to stable from negative, affirming all ratings and lowering the parent-level FFO to debt downgrade threshold to 17%.

  • Customer growth just under 1% and 24% load growth over the past 5 years, supported by strong local economies.

Concerns

4

  • Consolidated net income decreased to $50 million ($0.24 per diluted share) in Q1 FY26 from $63 million ($0.31 per share) in Q1 FY25.

  • Electric company net income decreased to $58 million ($0.28 per diluted share) from $71 million ($0.35 per share) in the prior year.

  • Milder first quarter weather negatively impacted earnings, partially offset by lower depreciation and interest expense.

  • Temporary outages at a few large customers impacted weather-normalized load, though offset by strength in public authority and oilfield sectors.

Guidance & targets

CategoryTargetConfidence
Consolidated Earnings Per Share
$2.43
high materiality
High
Consolidated Earnings Per Share Range
$2.38 to $2.48
high materiality
High
Long-term EPS CAGR
5% to 7%
high materiality
High

Orderbook & backlog

Google Data Center Load 1 GW 2026 IRP

Expected load by 2031; previously referred to as customer X; consistent with 2026 IRP; on a 7 GW system.

Deals & partnerships

Google Long-term special contracts to serve multiple data centers in Oklahoma

These contracts are for data centers in Muskogee and Stillwater. Google was previously referred to as customer X. The expected load and ramp rate are consistent with the 2026 IRP.

Google Capacity agreements from two solar facilities

Secured capacity from two solar facilities currently under construction, providing 600 MW of nameplate capacity. OGE will request pre-approval from both Oklahoma and Arkansas commissions for these CPAs.

Capital programs

Tinker Power Plant commissioned

Benefit:98 MW

Commissioned in February 2026.

Horseshoe Lake CTs under construction

Benefit:450 MW

Expect 450 MW of new CTs to come online in Q4 FY26, with groundbreaking on 2 additional 450 MW units.

Frontier Energy Storage Project advancing

Benefit:300 MW

Still advancing the 300 MW Frontier Energy storage project. Expect pre-approval in August.

SPP Transmission Projects pending acceptance

Expect to complete the acceptance of the notices to construct on directly assigned SPP transmission projects in October.

Risks & headwinds

Milder weather impact on earnings Q1 FY26

Q1 FY26 consolidated EPS down to $0.24 from $0.31 in Q1 FY25

Mitigation:Company expects to achieve full-year guidance assuming normal weather for the balance of the year.

Temporary outages at large customers Q1 FY26

Impacted weather-normalized load

Mitigation:Partially offset by strength in the public authority and oilfield sectors.

Price escalation in other markets Ongoing

Not observed in OGE's market

Mitigation:Company has customer protections, oversight, and regulatory framework in place to prevent similar developments.

Construction timeline uncertainty for Seminole to Shreveport line Clarity by early Q4 FY26

SPP's mid-2028 in-service date was a modeling assumption, not an actual construction timeline.

Mitigation:OGE is firming up the timeline and will provide clarity by early Q4 FY26.

What to watch in Q2 FY26

Large Load Tariff Filing

by July 1
Current In progress
Target Filed with Oklahoma Corporation Commission

Why it matters

This tariff will establish a clear and durable regulatory path for future large load activity, crucial for managing economic development and protecting existing customers.

In Oklahoma, we are finalizing a stand-alone large load tariff and expect to file it with the Oklahoma Corporation Commission no later than July 1, providing a clear, durable regulatory path for future large load activity.

Find out whether OGE delivers this. Inve re-checks your case every morning.

Q&A highlights

Does HB 2992, requiring separate large load tariffs and cost causation protections, materially improve OGE's negotiating position with large load customers, or was the company already heading in that direction?

The legislation is supportive of the company's existing direction, which has always prioritized protecting the existing customer base. There is strong alignment with legislators on customer protection and economic development.

“I think it's clearly supportive of the direction we've been heading in our discussions with not just Google, but other large load providers. Protecting the existing customer base has been paramount to us from day 1.”

asked by Whitney Mutalemwa · answered by R. Trauschke

2 min read 5 chapters

Detailed narrative

Data Center Strategy and Google Partnership

OGE Energy has formalized long-term special contracts with Google to serve multiple data centers in Oklahoma, previously referred to as 'customer X'. These agreements ensure broad customer protections, including minimum charges, and require Google to pay 100% of connection costs and its fair share for power. The expected load and ramp rate from Google are consistent with the company's 2026 Integrated Resource Plan (IRP), representing approximately 1 GW of load by 2031 on a 7 GW system. This partnership is seen as a significant growth tailwind, building on a historically strong trajectory.

Generation Capacity Expansion

The company is actively expanding its generation capacity to support customer growth and demand. The 98 MW Tinker power plant was commissioned in February 2026. Additionally, 450 MW of new combustion turbines (CTs) at Horseshoe Lake are expected to come online in Q4 FY26, with groundbreaking on two additional 450 MW units. The 300 MW Frontier Energy storage project is also advancing. Including capacity agreements from two solar facilities (600 MW nameplate capacity) secured with Google, these initiatives represent 1.7 GW of capacity additions, strengthening the system for continued growth.

Regulatory Activities and Large Load Tariff

OGE Energy has a busy regulatory agenda for 2026. A stand-alone large load tariff is expected to be filed with the Oklahoma Corporation Commission by July 1, providing a clear regulatory path for future large load activity. The company is also preparing for a rate review filing later in the year, with new rates anticipated in 2027. Pre-approval for the Frontier Energy Storage project is expected in August, and pre-approvals for other RFP projects will be sought on a rolling basis. In October, the company expects to accept notices to construct for directly assigned SPP transmission projects.

Financing and Credit Strength

The company completed a debt issuance at the electric utility in April 2026, satisfying its financing needs for the year under the current plan. Equity was issued in late 2025 to support incremental capital. Moody's recently revised the outlook for OGE Energy and OG&E to stable from negative, affirming all ratings. Moody's cited a constructive regulatory framework, improved cost recovery mechanisms, and balance sheet actions as supportive. The parent-level FFO to debt downgrade threshold was lowered to 17%, which management views as a strong confirmation of their financial strategy.

Load Growth and Economic Development

OGE Energy's service area continues to perform well, with customer growth just under 1%. Weather-normalized load remained stable year-over-year, despite temporary outages at some large customers, offset by strength in the public authority and oilfield sectors. The company has experienced approximately 24% load growth over the past five years, driven by strong local economies and its low-cost, reliable business model. The Google partnership further reinforces this positive trajectory, leveraging low electric rates to foster economic growth.

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