[WEC] WEC Energy Group: Q3 2026 Earnings Test Data Center Load Growth

WEC Energy Group is a Milwaukee-based holding company for regulated electric and natural gas utilities that serve about 4.8 million retail customers in Wisconsin, Illinois, Michigan and Minnesota[1]. The company has scheduled its earnings call for 2026-10-29[2], when it will report results for the third quarter 2026, the three months ended September 30, 2026, the first full quarter of data center load growth from Microsoft. In the latest reported quarter, the second quarter of 2026, WEC posted revenue of $2.062 billion, net income attributed to common shareholders of $299.2 million and diluted earnings per share of $0.91, up from $0.76 a year earlier[3]; large commercial and industrial electricity sales in Wisconsin rose 9.6% from a year earlier[4], driven mainly by the first phase of Microsoft's data center, which entered service in April[5]. Management guided third-quarter EPS to $0.92 to $0.98, a range that reflects actual July weather and assumes normal weather for the rest of the quarter, and reaffirmed full-year guidance of $5.51 to $5.61[6][7]. The Drillr consensus of six analysts puts third-quarter EPS at $0.971, within a range of $0.889 to $1.022, and four analysts put third-quarter revenue at $2.270 billion, although revenue includes pass-through fuel and gas costs and does not directly reflect profit[8]; the ten-analyst full-year EPS consensus of $5.61 matches the top of company guidance[9]. The Drillr earnings calendar records third-quarter 2025 EPS of $0.83 on revenue of $2.104 billion, so the guidance midpoint implies growth of about 14% from a year earlier[2].

Three things matter most in these results. The first is Microsoft's first full quarter of power use: second-quarter large commercial and industrial sales in Wisconsin rose by 289.5 gigawatt-hours from a year earlier[4], and weather-normalized retail electricity sales grew 4.2% including very large customers but only 1.2% excluding them and the iron ore mine[10], so whether the third-quarter increase at least matches the second quarter will show whether this is a sustained ramp or a one-time jump at switch-on. The second is the cash content of earnings growth: of the 15 cents of extra EPS in the second quarter, 9 cents came from the equity return that accounting rules allow on assets under construction (AFUDC-Equity), while cash returns from very large customer projects contributed only 2 cents[11], and the company has said it will release its new five-year capital plan on the third-quarter call[12], so the plan's size and share issuance will determine whether that book income eventually becomes per-share growth. The third is the profit floor of the Chicago gas business: the Illinois segment, home to Peoples Gas, earned $3.1 million less in the second quarter than a year earlier[13], and pipe replacement has slowed for lack of trained workers[14], so third-quarter segment earnings and capital spending will show whether this business has stabilized before new rates take effect next year.

Company Background and Business Structure

WEC Energy Group is a utility holding company whose wholly owned subsidiaries run regulated natural gas and electric operations and renewable energy, and it also holds an approximately 60% equity interest in the regional transmission company American Transmission Company (ATC)[15][16]. In Wisconsin, Wisconsin Electric (WE) supplies electricity to southeastern Wisconsin, including the Milwaukee metropolitan area, as well as east central and northern Wisconsin; Wisconsin Public Service (WPS) covers northeastern and central Wisconsin; and Upper Michigan Energy Resources (UMERC) serves Michigan's Upper Peninsula, where its customers include an iron ore mine[17]. WE, WPS and Wisconsin Gas (WG) also distribute natural gas across Wisconsin[18]. At the end of June 2026, the company had total assets of $52.75 billion[19].

The company reports results in six segments[15], and the Wisconsin segment is by far the most important. In 2025, the Wisconsin segment generated revenue of $7.296 billion, the Illinois segment $1.684 billion, the other states segment $527.5 million and the non-utility energy infrastructure segment $770.2 million[20]. By earnings, Wisconsin contributed $1.055 billion, about 68% of the company's $1.558 billion of net income attributed to common shareholders, while Illinois contributed $122.1 million, other states $60.8 million, electric transmission $147.6 million and non-utility energy infrastructure $411.1 million, and corporate and other lost $238.9 million[21]. By asset base, the business spans Wisconsin, Illinois, Michigan and Minnesota, plus WECI and ATC[22]; the Illinois segment consists of Chicago's Peoples Gas (PGL) and North Shore Gas (NSG)[23].

The transmission and non-utility segments are accounted for differently from the utilities. ATC is recorded under the equity method: in 2025 WEC recognized $215.8 million of equity earnings from it, which became $147.6 million of segment earnings after interest and income taxes[24]. The non-utility energy infrastructure segment includes We Power, which leases about 2,500 megawatts of generation to WE; Bluewater, which owns underground natural gas storage in Michigan; and WECI, which holds interests in several renewable generating facilities[25]. On the second-quarter call, management said the segment's earnings were affected by production tax credits and generation market prices[10]. Starting in 2026, data centers such as Microsoft and Vantage/Oracle buy power under dedicated tariffs as very large customers (VLCs, meaning customers with more than 100 megawatts of new demand), and they directly pay for their own electricity and for the power plants and distribution facilities built to serve them[26].

Financial History and Current Position

WEC's total earnings rose slightly in 2025, but earnings per share were essentially flat. Revenue was $9.800 billion, compared with $8.600 billion in 2024 and $8.893 billion in 2023, and net income attributed to common shareholders was $1.558 billion, slightly above $1.527 billion in 2024. However, diluted shares rose from 316.5 million to 323.8 million and diluted EPS fell from $4.83 to $4.81, while the income statement also included $130.0 million of impairments related to the Illinois segment and interest expense rose from $815.3 million to $895.1 million[27]. The main reason for the drop in Illinois earnings was a $205.0 million pre-tax charge after PGL and NSG agreed with the Illinois Attorney General on a settlement resolving all open proceedings related to the UEA and QIP riders[28]. Operating cash flow in 2025 was $3.379 billion, while capital expenditures were $4.398 billion, well above $2.781 billion in 2024[29]; AFUDC-Equity recorded that year was $99.8 million, compared with $59.8 million in 2024[30].

Earnings growth accelerated clearly in the first half of 2026. First-quarter net income attributed to common shareholders was $804.4 million, or $2.45 per diluted share, compared with $724.2 million and $2.27 a year earlier[31]. Second-quarter revenue was $2.062 billion (versus $2.010 billion a year earlier), net income attributed to common shareholders was $299.2 million (versus $245.4 million) and diluted EPS was $0.91 (versus $0.76); first-half revenue was $5.496 billion, net income attributed to common shareholders was $1.104 billion and diluted EPS was $3.36, compared with $3.02 a year earlier[3]. By segment, second-quarter Wisconsin earnings were $208.2 million, up $25.8 million or 14.1%[32], while Illinois earned $19.5 million, down $3.1 million[13].

On the funding side, capital spending plus dividends already exceed operating cash flow, and the gap requires external financing. In the first half of 2026, operating cash flow was $2.211 billion and capital expenditures were $2.080 billion (versus $1.531 billion a year earlier); the company also contributed $112.4 million to ATC and paid $620.3 million of common dividends, while it issued $1.804 billion of long-term debt and retired $1.189 billion[33]. At the end of June, long-term debt stood at $19.216 billion, the current portion of long-term debt at $1.414 billion, short-term debt at $1.934 billion, cash at $50.0 million and common shareholders' equity at $14.135 billion[19]. The second-quarter dividend was $0.9525 per share[3], an annualized $3.81 that is 6.7% higher than a year earlier, and the company targets a payout ratio of 65% to 70% of earnings[34].

Operating Model

WEC's revenue depends on electricity and gas volumes and on regulator-approved prices, but fuel and gas costs are largely passed through to customers, so they change the size of revenue rather than determine profit. In 2025, retail electric revenue included $2.250 billion from residential customers, $1.764 billion from small commercial and industrial customers and $1.058 billion from large commercial and industrial customers[35]; natural gas utility revenue was $3.967 billion, including $1.742 billion in Wisconsin and $1.718 billion in Illinois[36]. The company measures this profit source with utility margin, a non-GAAP measure equal to revenue minus fuel, purchased power and natural gas costs; the Wisconsin segment's utility margin was $4.749 billion in 2025, up $536.2 million[37]. Electricity sales in Wisconsin are seasonal because residential cooling load lifts summer volumes above other seasons[38], and second-quarter Wisconsin electric revenue was $1.360 billion, up $52.2 million[39].

Earnings in the regulated business depend on the size of the rate base, the authorized return and regulatory lag. The three Wisconsin utilities were authorized a 9.8% return on equity (ROE) for 2026, and WE's electric rates rose by $169.5 million, or 4.5%, that year[40]; earnings above the authorized ROE are shared with customers, and WE keeps all of the excess only for the first 15 basis points[41]. Second-quarter Wisconsin utility margin was $1.123 billion, up $56.4 million[39], including $44.2 million from the rate orders, a $10.8 million current return on bespoke resources built for very large customers and a net $0.2 million decrease from sales volumes, because a $20.4 million hit from unfavorable spring weather was substantially offset by a $20.2 million gain from weather-normalized customer growth[42]. Other income in the segment rose $32.4 million in the same quarter, including $29.6 million from AFUDC-Equity[43]. In timing terms, rate orders flow into the year's earnings from their January 1 effective date, while AFUDC becomes cash revenue only after the assets enter service and are included in rates.

The key to the cash model is that operating cash flow excludes non-cash income such as AFUDC-Equity, while capital spending persistently exceeds operating cash flow minus dividends. The first-half 2026 cash flow statement deducted $94.8 million of AFUDC-Equity from net income, compared with $38.6 million a year earlier[33]. For 2026 to 2030, the company plans operating cash flow of $20.5 billion to $21.5 billion, capital spending of $33.3 billion excluding ATC and dividends of $7.6 billion to $7.8 billion, with the gap filled by $14.2 billion to $14.8 billion of incremental debt (including $5.0 billion to $6.0 billion of junior subordinated notes or other securities with equity content) and $5.3 billion to $5.7 billion of common equity[44]. The company targets about $1.1 billion of common equity issuance in 2026 and locked in $760 million in the first half through employee plans and its ATM program[45]; the ATM portion was sold through forward contracts that had not settled by the end of June and mature in 2027[46].

Industry and Competitive Position

WEC's utilities operate within their service territories, and competition comes mainly from customer self-generation, alternative energy sources and other utilities competing for wholesale sales to municipalities and cooperatives, while large commercial and industrial gas customers can also switch between natural gas and alternative fuels[47]. Gas customers who buy their gas directly from a third-party supplier still rely on WEC for transportation service[18]. The company ranked first overall in the 2025 E Source Large Business Customer Satisfaction Study[1], and WEC Energy Group's issuer credit ratings are A- from S&P and Baa1 from Moody's[48]. Data center siting is the new competitive dimension: Microsoft has announced plans to invest more than $20 billion in southeastern Wisconsin, WEC anticipates up to 2.6 gigawatts of load growth in the Milwaukee-to-Chicago corridor through 2030, and Vantage's Port Washington campus is forecast to add 1.3 gigawatts by 2030[5], bringing projected electric demand growth for 2026 to 2030 to 3.9 gigawatts, or about 45%[49].

That growth is also changing WEC's asset mix quickly, while the available materials offer limited support for peer comparison. The company projects its average asset base will rise from $34.2 billion in 2025 to $59.6 billion in 2030, an 11.7% compound annual growth rate, with about 15% of assets serving very large customers by then[22]. Because the materials lack comparable data for peer utilities, WEC's rate levels, ROE or capital intensity cannot be placed within the industry; the company itself says typical WE and WPS residential bills are below the national level[50] and that Chicago heating bills in the coldest month are among the lowest of major U.S. cities[51], but these are company claims.

Core Debates

Microsoft's Wisconsin data center began drawing power in the second quarter, lifting WEC's large-customer electricity sales by almost a tenth. The third quarter is its first full quarter of operation: will that load and the profit it brings keep growing, or was the second quarter a one-time step-up at switch-on?

This debate decides whether the foundation of WEC's capital plan and per-share growth target holds up. The company projects 3.9 gigawatts of new electric demand from 2026 to 2030[49], including up to 2.6 gigawatts from Microsoft in the Milwaukee-to-Chicago corridor and 1.3 gigawatts from Vantage/Oracle[5], and about 15% of its asset base is expected to serve these very large customers by 2030[52]. Sales volumes and the profit increase from very large customers are the earliest results of these contracts visible in the financial statements, and they underpin the company's target of 7% to 8% compound annual EPS growth from 2026 to 2030[52].

The second-quarter data show a clear jump. In the first quarter, before very large customers came online, Wisconsin large commercial and industrial sales were 2,968.5 gigawatt-hours, up 115.0 gigawatt-hours or 4.0%[53], and weather-normalized retail sales excluding the iron ore mine rose 1.3%[31]. After Microsoft's first phase entered service in April[5], second-quarter large commercial and industrial sales rose to 3,292.6 gigawatt-hours, up 289.5 gigawatt-hours or 9.6%[4]; weather-normalized retail sales grew 4.2% including very large customers but only 1.2% excluding them and the iron ore mine, a gap of 3.0 percentage points[10]. In the same quarter, weather-normalized customer growth added $20.2 million of utility margin and the current return on bespoke resources added $10.8 million, for a combined $31.0 million[42]; for comparison, full-year 2025 large commercial and industrial sales were 12,061.3 gigawatt-hours, only 94.6 gigawatt-hours more than in 2024[54].

The financial transmission works like this: a data center signs a very large customer service agreement and subscribes to dedicated resources, buildings come online one by one and lift large commercial and industrial sales, WEC bills under the very large customer tariff and earns a current return on bespoke resources under construction, and the result shows up as higher Wisconsin utility margin. Revenue and costs recovered under this tariff are excluded from future general rate cases and earnings sharing, with an ROE between 10.48% and 10.98% and an equity ratio of 57% fixed for the entire term[55]. What remains unresolved is the nature of the second-quarter jump: one explanation is a sustained load ramp, while another is a one-time step-up as the first-phase buildings came online together, with further growth waiting for later buildings and Vantage's first building, expected online by late 2027[12]. The company expects full-year 2026 weather-normalized sales excluding very large customers and the iron ore mine to be roughly flat with 2025[6], which shows that underlying non-data-center load is not growing on its own.

Four signals matter in the third quarter: whether the year-over-year increase in Wisconsin large commercial and industrial sales is at least about 290 gigawatt-hours, whether the gap between weather-normalized sales growth with and without very large customers holds near 3 percentage points, whether weather-normalized customer growth plus the bespoke resources current return totals at least $31.0 million, and whether anything changes in Oracle's credit support, Vantage's progress or new very large customer service agreements. If the large commercial and industrial increase falls below half of the second-quarter figure, the load ramp may be slowing; if Oracle's credit support changes or the Vantage load forecast is cut, recovery of the investment in dedicated resources would be affected. Microsoft has already signed a very large customer service agreement[5], the peak collateral requirement for the Oracle-related project is expected to be about $7 billion[56], and September investor materials said Oracle has met financial security requirements in line with those of the PSCW[57].

WEC earned 15 cents more per share in the second quarter, but 9 cents of that was an accounting return booked on assets still under construction, not cash. How much of third-quarter growth will lean on that non-cash income, and how many new shares will the new five-year investment plan require?

This debate concerns the cash content of WEC's per-share growth and the degree of dilution. The company is in the largest five-year capital plan in its history, with $37.5 billion of planned investment from 2026 to 2030[58], and projects including the Oak Creek combustion turbines, the Paris reciprocating engine units and Oak Creek LNG storage are expected to enter service between 2026 and 2030[59]. The larger AFUDC's share of construction-period earnings, the more WEC depends on future rate cases to convert it into cash returns; capital spending also keeps running above operating cash flow, and the gap must be filled with debt and new shares, which directly determines whether per-share growth materializes.

AFUDC has already become a major source of earnings growth. Full-year 2025 AFUDC-Equity was $99.8 million[30], while the second quarter of 2026 alone produced $50.8 million (versus $21.3 million a year earlier) and the first half produced $94.8 million (versus $38.6 million)[60]; subtracting the first half from the full year implies about $61.2 million for the second half of 2025 combined, which is a derived figure rather than a reported quarterly value. Second-quarter EPS rose 15 cents, of which rate-based growth contributed 13 cents, including 9 cents of incremental AFUDC-Equity and 2 cents of incremental cash returns from very large customer projects[11], while the 2026 rate orders added $117.7 million to first-half Wisconsin utility margin[61]. Capital spending rose from $817.9 million in the first quarter[62] to about $1.262 billion in the second quarter (the first-half total of $2.080 billion minus the first quarter), including about $1.116 billion in Wisconsin[63]; the 2026 capital plan is $5.675 billion, including $657 million for ATC[58], or about $5.018 billion excluding ATC, which implies an average of about $1.47 billion per quarter in the second half.

The financial transmission runs from capital spending to a construction-work-in-progress balance, with AFUDC-Equity booked in other income as non-cash income, and only after the assets enter service and rate cases add them to the rate base does it become base-rate revenue and cash. The funding gap is filled with debt and new shares, which affects interest costs and per-share dilution: first-half operating cash flow of $2.211 billion did not cover $2.080 billion of capital spending plus $620.3 million of dividends, and long-term debt rose by a net $615.1 million[33]. Another explanation is that rising AFUDC is the normal prelude to rate-base expansion, because the assets will enter rates once in service under projects the PSCW has approved or will review, so the non-cash portion is only a timing difference; the main driver of the 2027 and 2028 rate requests by WE, WPS and WG is precisely these investments, which are already approved or expected to be approved before or during 2028, and the requested ROE is 9.9%[41].

What to watch in the third quarter is the split of the per-share increase among rate growth, very large customer returns and AFUDC, as well as the financing structure of the new plan. Specifically, the questions are whether diluted EPS is at least the $0.92 low end of guidance[6], whether AFUDC-Equity is at least the second quarter's $50.8 million and what share of the per-share increase it represents, whether quarterly capital spending approaches about $1.47 billion, and how large the 2027 to 2031 capital plan is and what share of it is equity-funded. If EPS comes in below $0.92, rate growth or cost control has deviated from plan; the company has said that incremental capital beyond the current plan is to be funded with 50% equity[45], and if the new plan's incremental capital requires more than 50% equity, per-share dilution would increase.

WEC's Chicago gas utility took a charge of more than $200 million last year to settle old disputes, its new delivery rates do not start until January, and its pipe-replacement work has slowed for lack of trained crews. Will the business's seasonal third-quarter loss widen, and can the pipe programme get back on schedule?

The central question for the Illinois business is whether it can move from regulatory disputes back to normal growth. The Illinois segment generated $1.684 billion of revenue in 2025, about 17% of the company total[20], and the income statement recorded impairments related to the Illinois segment in each year from 2023 to 2025, of $178.9 million, $12.1 million and $130.0 million respectively[27]. The Illinois Commerce Commission (ICC) has directed PGL to retire all cast and ductile iron pipe under 36 inches in diameter by January 1, 2035[64], and the company plans to retire more than 1,000 miles of older pipe, with annual investment expected to ramp up to $500 million in 2028[65]; whether these investments are completed on time and enter rates at a reasonable return will decide whether the business can resume growth.

The settlement cleared the old disputes, but earnings remain under pressure until new rates take effect. Illinois segment earnings fell from $252.1 million to $122.1 million in 2025[21], mainly because of the $205.0 million pre-tax settlement charge[28]; the ICC approved the settlement 5-0 on May 21, 2026, resolving 12 open dockets[66], and PGL will begin refunding customers in the fourth quarter of 2026, at $25.0 million a year for three years[67]. In the second quarter of 2026, Illinois segment earnings were $19.5 million, down $3.1 million, mainly because of higher benefit expenses and the absence of a prior-year gain on a renegotiated lease, while operation and maintenance expense excluding riders was $84.8 million, up $6.4 million[13]. First-half segment capital spending was $148.5 million, compared with $125.4 million a year earlier[63], of which $55.9 million came in the first quarter[62] and about $92.6 million in the second quarter.

The financial transmission runs from the ICC's retirement directive to capital spending under PGL's Pipe Retirement Program (PRP), then to the rate case that adds the investment to the rate base, and only after new rates take effect, expected by January 1, 2027, does it become delivery revenue; until then, growth in depreciation, interest and operating costs creates regulatory lag, and settlement refunds also reduce cash. In July, PGL cut its rate request by $58 million to $144 million, citing the settlement-related rate reduction and certain forecasted construction costs moved to later years; PGL's current ROE is 9.38% with an equity ratio of 50.79%, and its forecast 2027 rate base is $4.671 billion[51]. PGL is now requesting an increase of $144.0 million (14.6%) and NSG $8.7 million (8.4%), both requesting a 10.10% ROE and a 54.0% equity ratio, with PGL's request including about $349 million of PRP capital spending planned for 2027 and an ICC decision anticipated in the fourth quarter[23]. Another explanation is that slower spending is a deliberate choice to hold back investment and limit regulatory lag until new rates are clear, rather than an execution problem, and the company's quarterly filing also says it wants the rate case to provide further regulatory clarity before it significantly increases PRP spending[64]; the second-quarter call, however, attributed the slowdown to a shortage of trained labor[14].

In the third quarter, the questions are whether the year-over-year change in Illinois segment earnings stays within negative $5 million, whether quarterly capital spending is at least the second quarter's roughly $92.6 million, whether the year-over-year increase in operation and maintenance expense excluding riders stays at or below $6.4 million, and what ROE and PRP revenue requirement the proposed rate-case order includes. Because most PGL and NSG customers use natural gas for heating, Illinois segment earnings are generally higher in winter[13], so the third quarter is a low season and the year-over-year change is more informative than the absolute level. If segment earnings deteriorate by more than $10 million from a year earlier, a new charge or cost overrun may have occurred; if the proposed order cuts the PRP revenue requirement, the return on Chicago pipe investment would fall short of the request.

Risks and Falsifiers

The first risk is political pressure on data centers and electricity rates. On the second-quarter call, management noted that a Wisconsin gubernatorial candidate has proposed a statewide data center moratorium and that local siting pushback has emerged in some communities[14]; at the same time, WE, WPS and WG have applied for rate increases in both 2027 and 2028, with a PSCW order expected in the fourth quarter[50]. The financial exposure is future very large customer contracts and incremental capital in 2030 and 2031, since management said most prospective very large customers in discussion are in the 400 to 500 megawatt range[68] and that upside from new contracts is mostly concentrated in the 2030 to 2031 timeframe[14], as well as the outcome of the 2027 and 2028 rate cases. The risk would be falsified if new very large customer service agreements continue to be signed, the moratorium proposal does not enter the legislative process and the fourth-quarter rate orders come close to the requests.

The second risk is financing and credit metrics. The funding gap in the 2026 to 2030 plan is to be filled with $14.2 billion to $14.8 billion of incremental debt and $5.3 billion to $5.7 billion of common equity[44], and the company targets S&P FFO to debt above 15%, with current issuer credit ratings of A- from S&P and Baa1 from Moody's[48]. The exposure is interest expense ($895.1 million in 2025[27]) and per-share dilution, and a credit downgrade would raise the cost of all new debt. The risk would not materialize if the new capital plan maintains the FFO-to-debt target and current credit ratings and funds incremental capital with about 50% equity[45].

The third risk is the dispute over Oracle's credit support and the very large customer collateral terms. After a credit downgrade of its parent, the generation, transmission and distribution assets WEC is building for Oracle America Cloud Services require additional collateral, with the peak requirement expected to be about $7 billion[56]; a very large customer has petitioned the Wisconsin Circuit Court to review the tariff's credit support and collateral provisions[69], while September investor materials said Oracle has met the financial security requirements[57]. The exposure is the dedicated generation, transmission and distribution assets and their current return ($10.8 million in the second quarter[70]), along with Vantage's forecast 1.3 gigawatts of load by 2030. The risk would be falsified if the third-quarter report confirms that credit support remains in place, Vantage's first building stays on track for late 2027 and the load forecast is maintained.

The fourth risk is affordability pressure in the 2027 and 2028 Wisconsin rate cases. WE has requested electric rate increases of $175.8 million (4.7%) for 2027 and a further $179.5 million (4.5%) for 2028, WPS has requested $86.1 million (6.3%) and $50.8 million (3.5%), and the requested ROE is 9.9%[41]; WE's forecast 2027 electric rate base is $10.179 billion, excluding very large customers[71]. Orders below the requests would lower rate-base returns from 2027, and the exposure is the Wisconsin segment, which earned $1.055 billion in 2025. The risk would be falsified if the PSCW's fourth-quarter order sets an ROE no lower than the current 9.8% and approves rate increases close to the requests.

The fifth risk is PRP execution and prudence review. Labor constraints slowed pipe retirement in 2026[14], PRP costs will be reviewed for prudence by the ICC in future rate cases and overseen by a safety monitor the ICC hired, and failure to meet the 2035 deadline could expose the company to civil penalties under Illinois statute[64]. The exposure is PGL's roughly $349 million of PRP capital spending in 2027, annual pipe investment of about $500 million from 2028 and the Illinois segment, which earned $122.1 million in 2025. The risk would be falsified if third-quarter Illinois capital spending is no lower than in the second quarter and interim progress in the rate case preserves the PRP revenue requirement.

What to Watch Next

• Data center load: whether the year-over-year increase in Wisconsin large commercial and industrial sales, which was 289.5 gigawatt-hours (9.6%) in the second quarter[4], stays at about 290 gigawatt-hours or more; a drop below half would signal a slowing ramp.
• Data center load: whether the gap between weather-normalized sales growth with and without very large customers, 4.2% versus 1.2% in the second quarter[10], holds near 3 percentage points.
• Data center load: whether customer growth plus the bespoke resources current return, $31.0 million in the second quarter[42], stays at or above that level.
• Data center load: whether Oracle's credit support, against a peak collateral requirement of about $7 billion[56], and Vantage's late-2027 first building[12] stay on track, along with any new service agreements.
• Book income and financing: whether third-quarter diluted EPS lands within the $0.92 to $0.98 guidance[6], compared with $0.83 a year earlier[2]; below $0.92 would signal a deviation from plan.
• Book income and financing: AFUDC-Equity against the second quarter's $50.8 million[60] and its share of the per-share increase.
• Book income and financing: whether quarterly capital spending moves from about $1.262 billion in the second quarter[63] toward about $1.47 billion.
• Book income and financing: the size of the 2027 to 2031 capital plan against the current $37.5 billion[58], and whether incremental capital stays at 50% equity[45]; more equity would mean more dilution.
• Chicago gas: whether the year-over-year change in Illinois segment earnings, negative $3.1 million in the second quarter[13], stays within negative $5 million; deterioration beyond $10 million would point to a new charge.
• Chicago gas: whether quarterly Illinois capital spending stays at or above the second quarter's roughly $92.6 million[63].
• Chicago gas: whether the year-over-year increase in operation and maintenance expense excluding riders stays at or below $6.4 million[13].
• Chicago gas: the ROE and PRP revenue requirement in the proposed rate-case order, against a request of $144 million and a 10.10% ROE[23].

Conclusion

WEC's business is driven by the growth of regulated assets: the company invests in power plants, grids and gas networks, regulators set rates on a cost-plus-authorized-return basis, and sales volumes and rate orders together determine earnings. First-half 2026 diluted EPS was $3.36, up from $3.02 a year earlier[3], but a substantial part of the growth came from non-cash AFUDC-Equity, and capital spending plus dividends already exceed operating cash flow, with the gap filled by new debt and new shares[33]. The central unresolved relationship has three layers: whether Microsoft and other very large customers can extend the second-quarter jump in load through their first full quarter, whether book income during the $37.5 billion build-out converts to cash through rate cases as planned, and whether the Chicago gas business can hold its profit floor before new rates take effect in 2027.

Since the second-quarter results on 2026-07-29, the WEC coverage found consists mainly of earnings and dividend announcements, local news on rate cases and new gas plants, scoring reports from environmental groups and industry coverage of the Oracle data center, and none of it includes an assessment by a named author that makes an independent argument on the debates above. Outside interpretation therefore has a coverage gap: the current evidence on all three debates comes from company disclosures, earnings call summaries and Drillr's aggregated analyst data, and readers should keep these company figures separate from independent outside judgment.

The combination of observations that would materially strengthen the current understanding is a third-quarter year-over-year increase of at least about 290 gigawatt-hours in large commercial and industrial sales, diluted EPS within the $0.92 to $0.98 guidance range[6] with AFUDC's share of the per-share increase no longer rising, a new capital plan that keeps the FFO-to-debt target and funds incremental capital with about 50% equity, and stable Illinois earnings and capital spending alongside fourth-quarter rate orders in both states that come close to the requests. Conversely, if the large commercial and industrial increase falls below half of the second-quarter level, EPS comes in below $0.92, the new plan's equity share exceeds 50% or the Illinois segment records a new charge, the current understanding of the quality of WEC's growth would be materially weakened.

Sources

[1] WEC 8-K filed 2026-09-04 · company scale · 2026-09-04 · 8-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000099/a092026septemberfinal002.htm

[2] Drillr earnings calendar (updated 2026-10-25) · WEC 2026-10-29 call · 2026-10-25 · Drillr earnings calendar

[3] WEC 8-K filed 2026-07-29 · 2Q26 income statement · 2026-07-29 · 8-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000080/a2026q2wecearningsreleasee.htm

[4] WEC 10-Q filed 2026-08-04 · 2Q26 Wisconsin electric sales volumes · 2026-08-04 · 10-Q · https://www.sec.gov/Archives/edgar/data/783325/000078332526000087/wec-20260630.htm

[5] WEC 10-Q filed 2026-08-04 · economic growth, Microsoft and Vantage load · 2026-08-04 · 10-Q · https://www.sec.gov/Archives/edgar/data/783325/000078332526000087/wec-20260630.htm

[6] WEC Q2 2026 earnings call 2026-07-29 · Q3 guidance and sales outlook · 2026-07-29 · earnings-call · https://gateway.drillr.ai/mcp/private

[7] WEC 8-K filed 2026-07-29 · 2Q26 results and guidance · 2026-07-29 · 8-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000080/a2026q2wecearningsreleasee.htm

[8] Drillr analyst_financial_estimates (updated 2026-10-23) · WEC quarter ending 2026-09-30 · 2026-10-23 · Drillr analyst_financial_estimates · https://gateway.drillr.ai/mcp/private

[9] Drillr analyst_financial_estimates (updated 2026-10-23) · WEC fiscal year 2026 · 2026-10-23 · Drillr analyst_financial_estimates · https://gateway.drillr.ai/mcp/private

[10] WEC Q2 2026 earnings call 2026-07-29 · 2Q26 segment drivers · 2026-07-29 · earnings-call · https://gateway.drillr.ai/mcp/private

[11] WEC Q2 2026 earnings call 2026-07-29 · rate-based growth and AFUDC · 2026-07-29 · earnings-call · https://gateway.drillr.ai/mcp/private

[12] WEC Q2 2026 earnings call 2026-07-29 · Vantage progress and capital plan timing · 2026-07-29 · earnings-call · https://gateway.drillr.ai/mcp/private

[13] WEC 10-Q filed 2026-08-04 · 2Q26 Illinois segment results · 2026-08-04 · 10-Q · https://www.sec.gov/Archives/edgar/data/783325/000078332526000087/wec-20260630.htm

[14] WEC Q2 2026 earnings call 2026-07-29 · risks · 2026-07-29 · earnings-call · https://gateway.drillr.ai/mcp/private

[15] WEC 10-K filed 2026-02-20 · holding company, ATC stake and six segments · 2026-02-20 · 10-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000018/wec-20251231.htm

[16] WEC 10-K filed 2026-02-20 · ATC electric transmission segment · 2026-02-20 · 10-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000018/wec-20251231.htm

[17] WEC 10-K filed 2026-02-20 · Wisconsin electric utilities · 2026-02-20 · 10-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000018/wec-20251231.htm

[18] WEC 10-K filed 2026-02-20 · Wisconsin natural gas utilities · 2026-02-20 · 10-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000018/wec-20251231.htm

[19] WEC 8-K filed 2026-07-29 · June 2026 balance sheet · 2026-07-29 · 8-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000080/a2026q2wecearningsreleasee.htm

[20] WEC 10-K filed 2026-02-20 · 2025 revenues by segment · 2026-02-20 · 10-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000018/wec-20251231.htm

[21] WEC 10-K filed 2026-02-20 · 2025 earnings by segment · 2026-02-20 · 10-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000018/wec-20251231.htm

[22] WEC 8-K filed 2026-09-04 · asset base mix · 2026-09-04 · 8-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000099/a092026septemberfinal002.htm

[23] WEC 10-Q filed 2026-08-04 · PGL and NSG 2026 rate application · 2026-08-04 · 10-Q · https://www.sec.gov/Archives/edgar/data/783325/000078332526000087/wec-20260630.htm

[24] WEC 10-K filed 2026-02-20 · 2025 ATC earnings · 2026-02-20 · 10-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000018/wec-20251231.htm

[25] WEC 10-K filed 2026-02-20 · non-utility energy infrastructure segment · 2026-02-20 · 10-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000018/wec-20251231.htm

[26] WEC 10-Q filed 2026-08-04 · VLC and Bespoke Resources tariffs · 2026-08-04 · 10-Q · https://www.sec.gov/Archives/edgar/data/783325/000078332526000087/wec-20260630.htm

[27] WEC 10-K filed 2026-02-20 · 2023-2025 consolidated income statement · 2026-02-20 · 10-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000018/wec-20251231.htm

[28] WEC 10-K filed 2026-02-20 · 2025 Illinois settlement charge · 2026-02-20 · 10-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000018/wec-20251231.htm

[29] WEC 10-K filed 2026-02-20 · 2023-2025 operating cash flow and capex · 2026-02-20 · 10-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000018/wec-20251231.htm

[30] WEC 10-K filed 2026-02-20 · 2025 AFUDC · 2026-02-20 · 10-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000018/wec-20251231.htm

[31] WEC 8-K filed 2026-05-05 · 1Q26 results · 2026-05-05 · 8-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000049/a2026q1wecearningsreleasee.htm

[32] WEC 10-Q filed 2026-08-04 · 2Q26 Wisconsin segment results · 2026-08-04 · 10-Q · https://www.sec.gov/Archives/edgar/data/783325/000078332526000087/wec-20260630.htm

[33] WEC 8-K filed 2026-07-29 · 1H26 cash flows · 2026-07-29 · 8-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000080/a2026q2wecearningsreleasee.htm

[34] WEC 8-K filed 2026-09-04 · dividend policy · 2026-09-04 · 8-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000099/a092026septemberfinal002.htm

[35] WEC 10-K filed 2026-02-20 · 2025 electric revenues by customer class · 2026-02-20 · 10-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000018/wec-20251231.htm

[36] WEC 10-K filed 2026-02-20 · 2025 natural gas revenues by state · 2026-02-20 · 10-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000018/wec-20251231.htm

[37] WEC 10-K filed 2026-02-20 · 2025 Wisconsin utility margin · 2026-02-20 · 10-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000018/wec-20251231.htm

[38] WEC 10-K filed 2026-02-20 · seasonality of electric sales · 2026-02-20 · 10-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000018/wec-20251231.htm

[39] WEC 10-Q filed 2026-08-04 · 2Q26 Wisconsin utility margin · 2026-08-04 · 10-Q · https://www.sec.gov/Archives/edgar/data/783325/000078332526000087/wec-20260630.htm

[40] WEC 10-K filed 2026-02-20 · 2026 Wisconsin rate orders · 2026-02-20 · 10-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000018/wec-20251231.htm

[41] WEC 10-Q filed 2026-08-04 · 2027 and 2028 Wisconsin rate cases · 2026-08-04 · 10-Q · https://www.sec.gov/Archives/edgar/data/783325/000078332526000087/wec-20260630.htm

[42] WEC 10-Q filed 2026-08-04 · 2Q26 Wisconsin margin drivers · 2026-08-04 · 10-Q · https://www.sec.gov/Archives/edgar/data/783325/000078332526000087/wec-20260630.htm

[43] WEC 10-Q filed 2026-08-04 · 2Q26 Wisconsin AFUDC and interest · 2026-08-04 · 10-Q · https://www.sec.gov/Archives/edgar/data/783325/000078332526000087/wec-20260630.htm

[44] WEC 8-K filed 2026-09-04 · financing plan 2026-2030 · 2026-09-04 · 8-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000099/a092026septemberfinal002.htm

[45] WEC Q2 2026 earnings call 2026-07-29 · equity issuance · 2026-07-29 · earnings-call · https://gateway.drillr.ai/mcp/private

[46] WEC 10-Q filed 2026-08-04 · ATM program and forward sales · 2026-08-04 · 10-Q · https://www.sec.gov/Archives/edgar/data/783325/000078332526000087/wec-20260630.htm

[47] WEC 10-K filed 2026-02-20 · competition · 2026-02-20 · 10-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000018/wec-20251231.htm

[48] WEC 8-K filed 2026-09-04 · credit ratings and FFO target · 2026-09-04 · 8-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000099/a092026septemberfinal002.htm

[49] WEC 8-K filed 2026-09-04 · sales growth forecast · 2026-09-04 · 8-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000099/a092026septemberfinal002.htm

[50] WEC 8-K filed 2026-09-04 · Wisconsin rate review proposals · 2026-09-04 · 8-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000099/a092026septemberfinal002.htm

[51] WEC 8-K filed 2026-09-04 · Illinois rate reviews · 2026-09-04 · 8-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000099/a092026septemberfinal002.htm

[52] WEC Q1 2026 earnings call 2026-05-05 · VLC share of asset base and EPS growth · 2026-05-05 · earnings-call · https://gateway.drillr.ai/mcp/private

[53] WEC 10-Q filed 2026-05-07 · 1Q26 Wisconsin electric sales volumes · 2026-05-07 · 10-Q · https://www.sec.gov/Archives/edgar/data/783325/000078332526000052/wec-20260331.htm

[54] WEC 10-K filed 2026-02-20 · 2025 Wisconsin electric sales volumes · 2026-02-20 · 10-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000018/wec-20251231.htm

[55] WEC 8-K filed 2026-09-04 · VLC tariff terms · 2026-09-04 · 8-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000099/a092026septemberfinal002.htm

[56] WEC 10-Q filed 2026-08-04 · VLC collateral requirement · 2026-08-04 · 10-Q · https://www.sec.gov/Archives/edgar/data/783325/000078332526000087/wec-20260630.htm

[57] WEC 8-K filed 2026-09-04 · Vantage and Oracle · 2026-09-04 · 8-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000099/a092026septemberfinal002.htm

[58] WEC 8-K filed 2026-09-04 · 2026-2030 capital plan · 2026-09-04 · 8-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000099/a092026septemberfinal002.htm

[59] WEC 8-K filed 2026-09-04 · thermal generation projects · 2026-09-04 · 8-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000099/a092026septemberfinal002.htm

[60] WEC 10-Q filed 2026-08-04 · 2Q26 other income and AFUDC-Equity · 2026-08-04 · 10-Q · https://www.sec.gov/Archives/edgar/data/783325/000078332526000087/wec-20260630.htm

[61] WEC 10-Q filed 2026-08-04 · 1H26 Wisconsin margin drivers · 2026-08-04 · 10-Q · https://www.sec.gov/Archives/edgar/data/783325/000078332526000087/wec-20260630.htm

[62] WEC 10-Q filed 2026-05-07 · 1Q26 capital expenditures by segment · 2026-05-07 · 10-Q · https://www.sec.gov/Archives/edgar/data/783325/000078332526000052/wec-20260331.htm

[63] WEC 10-Q filed 2026-08-04 · 1H26 capital expenditures by segment · 2026-08-04 · 10-Q · https://www.sec.gov/Archives/edgar/data/783325/000078332526000087/wec-20260630.htm

[64] WEC 10-Q filed 2026-08-04 · Illinois pipe retirement program · 2026-08-04 · 10-Q · https://www.sec.gov/Archives/edgar/data/783325/000078332526000087/wec-20260630.htm

[65] WEC 8-K filed 2026-09-04 · Illinois pipe retirement ramp · 2026-09-04 · 8-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000099/a092026septemberfinal002.htm

[66] WEC 8-K filed 2026-09-04 · Illinois rider settlement · 2026-09-04 · 8-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000099/a092026septemberfinal002.htm

[67] WEC 10-Q filed 2026-08-04 · Illinois settlement refunds · 2026-08-04 · 10-Q · https://www.sec.gov/Archives/edgar/data/783325/000078332526000087/wec-20260630.htm

[68] WEC Q2 2026 earnings call 2026-07-29 · new VLC prospects Q&A · 2026-07-29 · earnings-call · https://gateway.drillr.ai/mcp/private

[69] WEC 10-Q filed 2026-08-04 · VLC tariff rehearing and court petition · 2026-08-04 · 10-Q · https://www.sec.gov/Archives/edgar/data/783325/000078332526000087/wec-20260630.htm

[70] WEC 10-Q filed 2026-08-04 · 2Q26 bespoke resources current return · 2026-08-04 · 10-Q · https://www.sec.gov/Archives/edgar/data/783325/000078332526000087/wec-20260630.htm

[71] WEC 8-K filed 2026-09-04 · Wisconsin rate base and earnings sharing · 2026-09-04 · 8-K · https://www.sec.gov/Archives/edgar/data/783325/000078332526000099/a092026septemberfinal002.htm