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    WEC
    Earnings call· Dec 2025(Q4 FY25)

    WEC ENERGY GROUP Q4 FY25 earnings call WEC

    Feb 5, 2026 Source

    Executive summary

    WEC Energy Group Q4 FY25 — Data Center Growth Drives Expanded Capital Plan and Reaffirmed Long-Term EPS Growth

    WEC Energy Group concluded FY25 with strong adjusted earnings, driven by robust economic growth and significant data center demand in its service territory. This growth has led to a substantial increase in the multi-year capital plan, reinforcing the company's confidence in its long-term EPS growth trajectory. Management is actively navigating regulatory matters in Illinois and Wisconsin, while strategically investing in generation and infrastructure to meet evolving energy needs.

    Highlights

    5

    • Delivered full year 2025 adjusted EPS of $5.27, an 8% increase year-over-year.

    • Expanded 5-year capital plan by $1 billion to $37.5 billion, driven by 3.9 GW of new electric demand from data centers.

    • Reaffirmed long-term EPS growth target of 7% to 8% CAGR, with acceleration to the upper half of the range starting in 2028.

    • Increased dividend by 6.7% to an annualized $3.81 per share, marking the 23rd consecutive year of increases.

    • Projecting weather-normal retail electric sales in Wisconsin to grow 1.6% in 2026, with large commercial and industrial segment growing 5.8%.

    Concerns

    3

    • Incurred a $0.46 per share charge related to a proposed Illinois settlement, including a $130 million rate base reduction and $125 million in customer credits.

    • Higher interest expense contributed to a $0.24 variance in the Corporate and Other segment.

    • Potential pressure on FFO to debt metrics due to the Illinois settlement's cash component.

    Guidance & targets

    6
    CategoryTargetConfidence
    Full Year 2026 Adjusted EPS
    $5.51 to $5.61 per share
    high materiality
    High
    Q1 2026 Adjusted EPS
    $2.27 per share to $2.37 per share
    medium materiality
    High
    Long-Term EPS Growth Rate
    7% to 8% a year
    high materiality
    High
    2026 Debt Funding
    $4 billion to $5 billion
    medium materiality
    High
    2026 Common Equity Issuance
    $900 million and $1.1 billion
    medium materiality
    High
    Dividend Payout Ratio
    65% to 70% of our earnings
    medium materiality
    High

    Segment performance

    4
    SegmentRevenueYoYQoQMargin
    Utility Operations
    Adjusted earnings were $0.63 higher in 2025 compared to 2024, positively impacted by weather and significant rate base growth, partially offset by higher depreciation, amortization, O&M, and tax items.
    Adjusted earnings contribution: $0.63 higher in 2025 vs 2024Weather impact on earnings: $0.35 positive vs 2024Rate base growth contribution to earnings: $0.74AFUDC equity contribution to earnings: $0.12
    		————
    American Transmission Company (ATC)
    Earnings increased $0.02 compared to 2024, driven by continued capital investment to meet demand growth and maintain reliability, partially offset by a one-time gain recognized in 2024.
    Earnings increase: $0.02 vs 2024Capital investment contribution to earnings: $0.06
    		————
    Energy Infrastructure Segment
    Earnings increased $0.10 in 2025 from higher production tax credits associated with the acquisition of additional solar generation projects in late 2024 and early 2025.
    Earnings increase: $0.10 vs 2024
    		————
    Corporate and Other Segment
    Experienced a $0.24 negative variance driven by higher interest expense from increased debt balances, and gains recorded in 2024 from early debt retirements.
    Variance: $0.24 negative vs 2024
    		————

    Operational metrics

    9
    Adjusted EPS
    $5.27$0.39 increase over 2024 adjusted earnings
    FY25

    Excludes a one-time charge of $0.46 per share related to a proposed settlement in Illinois.

    Retail Electric Deliveries Growth
    1.1%YoY
    FY25

    Weather-normal, excluding the iron ore mine, slightly ahead of forecast in every segment.

    Retail Electric Sales Growth Forecast
    1.6%YoY from 2025 levels
    FY26

    Weather-normal, fueled by forecasted data center load.

    Common Equity Issued
    $800 million
    FY25

    Consistent with plan.

    Dividend per share
    $3.816.7% increase
    Annualized

    Increased by Board at January meeting.

    Illinois Settlement Charge
    $0.46
    FY25

    One-time charge related to proposed settlement resolving open reconciliation dockets on rider QIP spending (2017-2023) and uncollectible rider (2019-2023).

    Illinois Settlement Rate Base Reduction
    $130 million
    Prospective

    Part of proposed settlement, would be prospective with new rates in the pending Peoples Gas case.

    Illinois Settlement Customer Credits
    $125 million
    Over 3 years

    Part of proposed settlement, customers would receive over 3 years.

    Wisconsin Fuel Recovery Customer Return
    $55 million
    FY25

    Due to positive fuel recovery and warmer weather, to be given back to customers.

    Industry KPIs

    7
    MetricValueDetails
    Multi year capital plan$37.5 billionUSD
    Regulatory rate base growth$0.74earnings per share
    Adjusted EPS dividend growth7% to 8%CAGR
    Lng export segment disclosure2 BcfLNG facility
    Major regulated project construction progress1,100 megawattscombustion turbine
    Combined electric gas framework state mandates—
    Allowed ROE equity layer rate case calendar by j—

    Deals & partnerships

    5
    MicrosoftCustomer contract / Infrastructure developmentMultiyear delivery

    Purchased over 2,000 acres. First phase expected to go online in 2026. Received approval for 15 additional data center buildings. Pledged to be a good neighbor, pay fair share for electricity, minimize water use, create jobs, add to tax base, and invest in community.

    Vantage Data Centers (for Oracle and OpenAI)Customer contract / Infrastructure development$15 billion

    Signed on to develop facilities on approximately 1,900 acres. Broke ground on initial phase (670 acres) in December 2025. First facility could come online late 2026. Vantage expects to invest $15 billion to complete this phase in 2028.

    FoxconnLocal investment / Expansion$0.5 billion

    Announced new plans to renovate and expand its Racine County campus, focusing on manufacturing data center components. Expects to invest more than $0.5 billion.

    Rockwell AutomationLocal investment / New facility

    Planned in November to build a new manufacturing site in Southeastern Wisconsin, expected to span over 1 million square feet, potentially becoming the company's largest manufacturing campus globally.

    UlineLocal investment / Expansion

    Completed yet another large land purchase to further expand its business operations in Southeast Wisconsin.

    Capital programs

    7
    5-Year Capital Planunderway$37.5 billion
    Funding: 50% equity content for incremental capital
    Start: 2026

    Benefit: Meet 3.9 GW electric demand growth

    Updated plan, increased by $1 billion due to Microsoft expansion. Projecting long-term EPS growth of 7% to 8%.

    Natural Gas Generation & LNG Storage Investmentunderway$7.4 billion
    Start: 2026

    Benefit: Modern, efficient natural gas generation and LNG storage, including combustion turbines, RICE units, and upgrades.

    Part of the 5-year capital plan to maintain a reliable balanced generation mix.

    Renewables Investmentunderway$12.6 billion
    Start: 2026

    Benefit: Add 6,500 megawatts to generation fleet

    Part of the 5-year capital plan. Includes 7 renewable generation projects and 2 battery storage facilities under construction.

    Oak Creek Combustion Turbine Projectwell underway

    Benefit: 5-unit, 1,100-megawatt combustion turbine

    Construction is well underway at the Oak Creek site.

    LNG Facilitybroke ground
    Start: Q4 2025

    Benefit: 2 Bcf LNG facility

    Broke ground in the fourth quarter of 2025.

    Paris RICE Generation Sitebroke ground
    Start: Q4 2025

    Benefit: 7-unit RICE generation site

    Broke ground in the fourth quarter of 2025.

    Illinois Pipe Retirement Programunderway
    Start: 2026

    Benefit: Retire all cast iron and ductile iron pipe under 36 inches in diameter

    Key driver for Illinois rate request. Approximately 35 miles expected to be retired in 2026, ramping up to a run rate in 2028.

    Risks & headwinds

    6
    Financial impact from Illinois proposed settlementFY25 (charge), prospective (rate base reduction), 3 years (customer credits)

    $0.46 per share one-time charge; $130 million rate base reduction; $125 million customer credits over 3 years (approx. $50 million in first year)

    Mitigation: Settlement resolves 12 pending cases, allowing focus on future; reaffirmed long-term EPS growth guidance incorporates this impact, offset by data center growth.

    Increased interest expenseFY25

    $0.24 negative variance in Corporate and Other segment

    Mitigation: Company plans for $4 billion to $5 billion in debt funding in 2026, including refinancing, and has significant capacity for hybrid financing.

    Potential pressure on FFO to debt metricsNear-term

    Due to cash component of Illinois settlement

    Mitigation: Management acknowledged the pressure but did not detail specific mitigation beyond overall financial planning.

    Affordability concerns and election rhetoric in WisconsinLeading up to Wisconsin GRC filing in April 2026 and beyond

    General concern, no specific quantification

    Mitigation: Company is focused on keeping rates low, implementing cost-saving initiatives, and returning $55 million in positive fuel recovery to customers. VLC tariff designed to ensure large customers pay their fair share.

    Local opposition to data centersOngoing

    Not quantified, mentioned as 'a little noise around the state'

    Mitigation: Hyperscalers and company are increasing transparency and working proactively with communities; VLC tariff ensures fair cost allocation.

    Expiration of Point Beach PPA contracts2030 and 2033

    Contracts end in 2030 and early 2033

    Mitigation: Evaluating replacement options, including new generation builds, with potential upside for the capital plan; analysis to be factored into fall update.

    Q&A highlights

    6

    Seeking more detail on the 500 MW Microsoft expansion, potential beyond the 5-year plan, and the full scale of the opportunity.

    Scott Lauber confirmed the 500 MW is from new land north of Highway 11, and Microsoft views Wisconsin as a "multiyear delivery," suggesting more growth beyond 2030. He noted Microsoft is looking for more land and has been transparent locally, but he doesn't want to get ahead of their announcements.

    “I do not want to get out ahead of Microsoft and their plans. All I can really say is they're starting to do land at about 570 acres, and that's about where we put that 500 megawatts. There's more land. That's just the start of that development.”

    asked by Julien Dumoulin-Smith · answered by Scott Lauber

    2 min read6 chapters

    Detailed Narrative

    01

    Accelerated Data Center Demand & Capital Plan Expansion

    WEC Energy Group is experiencing significant electric demand growth, primarily from data centers in its service territory. Microsoft's expanded campus and Vantage Data Centers' projects for Oracle and OpenAI are driving an additional 3.9 gigawatts of electric demand growth in the 5-year plan. This has led to a $1 billion increase in the capital plan, now totaling $37.5 billion over the next five years, reinforcing the company's long-term growth outlook.

    02

    Illinois Regulatory Settlement

    The company reached a proposed settlement with the Illinois Attorney General to resolve 12 pending cases, including rider QIP and uncollectible rider reconciliations from 2017-2023. The settlement involves a $130 million rate base reduction and $125 million in customer credits over three years, with the first $50 million in the initial year. This aims to put historical issues behind them and focus on future investments like the pipe retirement program.

    03

    Wisconsin Regulatory Strategy

    WEC is pursuing a very large customer (VLC) tariff in Wisconsin, designed to ensure hyperscalers pay their fair share while protecting other customers. A commission order is expected in early May 2026. The company plans to file rate reviews in April 2026 for forward-looking test years 2027 and 2028, with affordability remaining a key consideration in their rate-setting process.

    04

    Strategic Generation Investments

    To meet the growing demand, the company plans to invest $7.4 billion in modern natural gas generation and LNG storage, including a 1,100-megawatt combustion turbine project and a 2 Bcf LNG facility. Additionally, $12.6 billion is allocated for renewables, aiming to add 6,500 megawatts to the generation fleet, with 7 renewable and 2 battery storage facilities currently under construction.

    05

    Financing and Shareholder Returns

    WEC expects to fund its capital plan with $4 billion to $5 billion in debt and $900 million to $1.1 billion in common equity in 2026, maintaining a 50% equity content for incremental capital. The Board approved a 6.7% dividend increase to $3.81 per share annually, aligning with its policy of paying out 65% to 70% of earnings, marking 23 consecutive years of dividend growth.

    06

    Point Beach PPA & Future Generation

    The contracts for Point Beach nuclear plant expire in 2030 and 2033. Management is evaluating replacement options, viewing potential new generation builds as an upside opportunity for the capital plan, especially given the high cost of the existing PPA and the need for economic solutions for customers.

    AI-generated summary of the company’s earnings call. Not investment advice.