Xcel Energy (NASDAQ:XEL) reported 2025 ongoing earnings of $3.80 per share, up from $3.50 per share in 2024, as leadership highlighted stronger rate outcomes, sales growth, and a growing pipeline of large-load and transmission opportunities. Management also reaffirmed 2026 earnings guidance of $4.04 to $4.16 per share and reiterated confidence in its longer-term growth outlook.
On the call, the company also noted it recorded a $300 million charge in 2025 tied to a settlement in principle with plaintiffs in the Marshall Wildfire. That charge reduced reported GAAP earnings to $3.42 per share, while ongoing earnings excluding the item were $3.80 per share. Management said the rest of the discussion focused on ongoing results.
2025 performance and key earnings drivers
Frenzel said 2025 marked the 21st consecutive year Xcel met or exceeded its initial ongoing earnings guidance. He also emphasized affordability and efficiency initiatives, pointing to the company’s “One Xcel Energy Way” continuous improvement program, which he said has delivered more than $1.5 billion in cumulative savings since 2020. He added that, based on a five-year average, Xcel ranked fourth lowest among peer utilities on O&M expenses per megawatt-hour.
CFO Brian Van Abel outlined the major earnings drivers in 2025, including:
- Higher electric and natural gas revenues from rate case outcomes, non-fuel riders, and sales growth, partially offset by higher fuel and purchased power costs, which he said increased earnings by $1.21 per share.
- Higher AFUDC, which he said increased earnings by $0.27 per share.
- Offsets from higher interest charges and common equity financing (a $0.46 per share headwind), higher depreciation and amortization (a $0.28 per share headwind), and higher O&M (a $0.25 per share headwind), along with other items.
Van Abel said weather-adjusted electric sales increased 2.2% in 2025, driven by higher commercial and industrial load in SPS and PSCo. For 2026, the company continues to expect weather-adjusted electric sales growth of 3%.
Customer bills, assistance programs, and operational milestones
Frenzel spent time discussing customer affordability, stating that Colorado residential electric customers have the “lowest share wallet out of all 50 states,” and that average electric bills in other Xcel states occupy “five of the top 11 spots in the country.” He also said residential electric bills in Denver and Minneapolis have risen “far less than inflation” since 2020 and have grown substantially less than in other regions.
Management also highlighted customer assistance efforts. Frenzel said Xcel’s energy assistance programs reached nearly 200,000 customers in 2025 and provided nearly $200 million in funding, which he described as the company’s highest one-year total.
On capital deployment, Frenzel said Xcel invested nearly $12 billion in 2025, its largest one-year total. He cited several project milestones, including:
- Commercial operation of phase two of the Sherco Solar project in September; a third phase is expected in 2026, and he said the project will be the largest solar facility in the Upper Midwest once complete.
- Completion of the conversion of the 1,000-megawatt Harrington coal plant to natural gas.
- 370 megawatts of wind repowering at the Border and Pleasant Valley facilities, with an expected $750 million of production tax credit benefits.
- Placing the 325-megawatt Rocky Mountain solar project in service, described as Xcel’s first utility-scale solar farm in Colorado.
Transmission buildout and wildfire mitigation
Frenzel said Xcel has been the leading builder of new transmission line miles over the past 15 years and highlighted progress on the Colorado Power Pathway, where two segments were energized ahead of schedule, on scope, and under budget. He said remaining segments are expected to be energized in 2026 and 2027.
On regional transmission opportunities, management said that across SPP and MISO in 2025 and 2026, Xcel has been awarded more than 760 miles of new 765 kV transmission lines. Van Abel added that a newly awarded 765 kV line in SPP provides “line of sight” to $1.5 billion of additional investment above the base five-year plan, with a targeted commercial operation date by the end of 2030.
Wildfire mitigation was another focus. Frenzel said Xcel accelerated investments in 2025, including completing “eight times as many” pole inspections and 25% more pole replacements than the prior year, and installing more than 250 Pano AI cameras and weather stations. He said Colorado and Texas regulators approved wildfire mitigation and resiliency plans, and that favorable wildfire legislation passed in Texas and North Dakota.
In the Q&A, Frenzel also addressed the company’s use of Public Safety Power Shutoff capability, calling it a rare measure and emphasizing that Xcel stands by its decision-making during a high-wind period in Colorado in December. He said the company continues to work on communications and operational improvements, and noted efforts such as a battery pilot for certain medically vulnerable customers.
Data center contracting, large-load tariffs, and strategic partnerships
Xcel highlighted a growing data center pipeline. Frenzel said the company recently signed an energy service agreement (ESA) with a large data center in the Upper Midwest, bringing Xcel to more than 2 gigawatts of new contracted data center capacity. Management’s stated goal is to contract another 1 gigawatt in 2026, reaching 3 gigawatts by the end of 2026.
Separately, the company announced an MOU with NextEra Energy to co-develop generation, storage, and interconnections to serve data centers across its operating companies. Frenzel said the company now expects to have 6 gigawatts of total data center capacity contracted by the end of 2027, with electricity sales and generation investment ramping into the 2030s. Executives said they view much of the incremental sales and capital investment opportunity as weighted toward the latter part of the decade and into the early 2030s, given contracting and construction timelines.
Management also discussed the regulatory framework for large loads. Executives said Xcel plans to file a large load tariff in Colorado early in Q2 and then bring forward large loads within that construct, likely alongside a generation package intended to show benefits for existing customers. They said large load tariff efforts are also in process in several other states, including Minnesota, Wisconsin, Texas, and Colorado.
In another partnership update, Frenzel said Xcel entered a strategic alliance with GE Vernova to support its portfolio of generation, grid, and technology projects into the 2030s. As an initial step, he said Xcel is purchasing five additional natural gas turbines, bringing the company to 24 gas combustion turbines on order across vendors.
Regulatory updates, wildfire claims, and outlook
Van Abel reviewed active rate proceedings. In Colorado, Xcel filed electric and natural gas rate cases in the fourth quarter and expects decisions and implementation of new rates by the end of Q3 2026. The company also filed a New Mexico electric rate case in November, with an expected decision in the second half of 2026. In Wisconsin, Xcel received final approval for electric and gas rates, with new rates implemented in January.
On wildfire-related legal matters, Van Abel said the company continues to make progress on the Smokehouse Creek wildfire claims process, having resolved 222 of 287 submitted claims. He said Xcel updated the low end of its estimated liability to $430 million and has committed $382 million in settlement agreements, noting approximately $500 million of insurance coverage.
For the Marshall wildfire, Van Abel said final settlement agreements have been executed with subrogation insurers and “nearly all” individual plaintiffs, with Xcel aware of three individual plaintiffs out of more than 4,000 who have not accepted a settlement or stopped prosecuting claims.
Looking ahead, Xcel reaffirmed its 2026 EPS guidance of $4.04 to $4.16 and reiterated expectations for 6% to 8%+ long-term earnings growth, with management stating it expects to deliver 9% EPS growth on average through 2030.
About Xcel Energy (NASDAQ:XEL)
Xcel Energy (NASDAQ: XEL) is a Minneapolis-based, publicly traded utility holding company that develops, owns and operates regulated electricity and natural gas delivery systems. The company’s core activities include generation, transmission and distribution of electricity, the delivery of natural gas to customers, and related customer service operations. Xcel provides a mix of utility services to residential, commercial and industrial customers and participates in wholesale energy markets where appropriate.
Its generation portfolio combines nuclear, natural gas, coal and a growing share of renewable resources such as wind and solar.
