Entergy Corporation Q1 FY2026 earnings call

Drew mentioned the company had a productive first quarter with strong financial results. They launched the Fair Share Plus pledge, which ensures data centers pay their fair share plus community benefits. They announced a new electric service agreement with Meta for a data center in North Louisiana with significant fair share and plus components. So far this year, they have signed ESAs totaling over 1,000 megawatts. Operational highlights include Orange County Advanced Power Station achieving its first fire milestone, and the power delivery team identifying over $30 million in capital savings on the Commodore to Churchill 230 kV project. They also discussed their customer-centric four-year capital plan of $57 billion, which is $14 billion higher than previous, including investments from the Meta agreement.

First quarter adjusted earnings per share was 86 cents. Industrial sales growth was very strong at 15% as new and expansion projects continued to ramp up their operations. Overall retail sales increased 6%. The earnings contribution from retail sales growth was essentially neutral as higher revenue from the industrial growth was offset by the effects of weather. The META contract creates significant customer and community benefits, and the company is refreshing outlooks to reflect the new agreement with approximately 8.5% compound annual retail sales growth through 2029 driven by 16% industrial growth, with data centers being a significant driver along with growth from various traditional Gulf South industries.

2026 guidance remains on track, and they are increasing adjusted EPS outlooks driven by 8.5% retail sales growth. They affirmed 2026 adjusted EPS guidance and updated outlooks, with adjusted EPS outlook for next year now 20 cents higher, growing radically to $6.40 by 2029. They expect approximately the same year-over-year adjusted earnings per share growth from 2029 to 2030.

New nuclear has significant challenges from a cost and cost uncertainty perspective, posing financial risk to the balance sheet of Entergy Louisiana or operating companies. There are also risks associated with the construction and financial aspects of new nuclear projects.

The first question from Shar Perez with Wells Fargo was about the CapEx increase and further updates, to which Drew and Kimberly responded. Nicholas Campanella with Barclays asked about the equipment outlook and new nuclear, with Drew responding. Jeremy Tenet with JP Morgan asked about the 1,000 megawatts of additional ESAs and nuclear technology, with responses. Richard Sunderland with Truist Securities asked about CAPEX elements for Meta and guardrails, with responses. Paul Zimbardo with Jefferies asked about conservatism on minimum bills and earnings from Meta CapEx, with responses. Bill Apicelli with UBS Financial asked about incremental capital for Meta and earnings run rate, with responses. Steve Fletchman with Booth Research asked about earnings from Meta CapEx and renewables RFP, with responses. Sophie Carp with KeyBank Capital Markets asked about regulatory mechanisms and impact of oil markets, with responses. Steve D'Ambrisi with RBC Capital Markets asked about terawatt hour sales growth and meta-facility ramp, with responses. Chris Ellinghouse with Siebert Williams asked about Iran issue and dividend payouts, with responses. Andrew Weissel with Scotiabank asked about financing meta Capex and industrial sales growth, with responses