WEC Energy Group Q3 2026: EPS up 42% to $1.18 on a hot summer; 2026 guidance raised to $5.60–$5.64

WEC Energy Group earned $389.3 million, or $1.18 per diluted share, in the third quarter of 2026, up from $271.3 million ($0.83) a year earlier, on revenue up 8.9% to $2.29 billion. Management names three drivers in this order: warmer-than-normal summer weather, its capital-spending plan, and cost control. Weather was the one that showed up most clearly in sales. Retail electricity deliveries (excluding the Michigan iron ore mine and Wisconsin's new data-center customers) rose 3.3%, but only 0.4% once weather is taken out. On the back of the quarter, WEC raised and narrowed its 2026 earnings guidance to $5.60–$5.64 per share, from $5.51–$5.61.

The numbers

For a utility, revenue is a weak guide to profit. Fuel and gas costs are passed through to customers at cost, so revenue moves with commodity prices. Cost of sales rose $43.1 million this quarter while revenue rose $186.6 million, so the gap that WEC keeps, utility margin, grew $143.5 million. That gap is what new rates, higher sales volumes and weather affect.

Where the earnings came from

The earnings release has no segment breakdown or weather figure in dollars; those come with the 10-Q, which has not been filed yet. The income statement still shows the main pieces of the $132.7 million rise in pretax income:

• Utility margin reflects the Wisconsin rate increases in effect since January 1, 2026, the first phase of data-center load, and a hot summer. The release does not split those apart. The sales data suggests weather was large: weather-normal deliveries grew 0.4% against 3.3% reported, and residential use rose 5.1%. Small commercial and industrial use rose 3.5%, and large commercial and industrial (excluding the mine and the data centers) rose 1.0%.
• Costs stayed flat. O&M rose 1.5%, which matches the "operating efficiency" the CEO credited.
• Other income almost doubled. The cash flow statement points to the reason: AFUDC-Equity (explained below) was $139.5 million for nine months, against $63.7 million a year earlier. Taking off the $94.8 million booked in the first half leaves about $44.7 million in Q3, against about $25.1 million in Q3 2025.
• Transmission: WEC's share of American Transmission Company's earnings rose 20% as ATC kept investing.
• Interest expense rose 8.1% as debt grew to fund the build-out. Long-term debt reached $19.7 billion, up from $18.5 billion at year-end.

What the headline numbers hide

Weather did a good share of the work. The +42% EPS line overstates what WEC earns in a normal summer. Management lists weather first among the drivers and calls it the main reason for the guidance raise, and weather-normal demand growth outside the data centers was only 0.4%. The release does not put a dollar figure on weather, so the exact split will only be clear in the 10-Q. Weather swings both ways and is not a lasting gain.

Some of the growth is construction accounting, not cash. AFUDC (Allowance for Funds Used During Construction) lets a utility book a return on money tied up in plants still being built, because regulators will later let it recover that return from customers. Our estimate is that roughly $19.6 million of Q3's pretax gain came from higher AFUDC-Equity. It is a legitimate part of utility earnings, but it turns into cash only once the plants enter customer rates.

Cash flow is strong, but it doesn't cover spending. Operating cash flow was $1.20 billion in Q3 (nine months $3.41 billion less the first half's $2.21 billion), about 3.1 times net income. For the nine months it was $3.41 billion, 2.3 times net income, helped by a seasonal $587.8 million drop in receivables after the heating season. Capital spending of $3.32 billion, dividends of $930.8 million and a new $170.8 million "payment for option to acquire projects" still exceeded it. WEC issued $2.40 billion of long-term debt and raised $382.5 million from stock sales over nine months, $358.7 million of it in Q3 alone.

No help from buybacks or tax. WEC does not buy back stock. Diluted shares rose 1.0%, so dilution trimmed EPS slightly. The effective tax rate was 10.7% (income tax $47.0 million on $437.3 million pretax), slightly below last year's 11.3%. At this quarter's pretax income, that difference is worth only about $2.4 million.

No GAAP vs adjusted gap. WEC reports only GAAP EPS in this release; there are no excluded items to look through.

On balance the quarter is flattered: EPS rose 42%, but weather-normal electric deliveries grew only 0.4% against 3.3% reported, and management itself credits warmer-than-normal weather first for both the quarter and the guidance raise.

Did last time's read hold up?

Our Q2 2026 report said the second half "depends mostly on weather" and named two things to watch before Q3: the Q4 2026 rate orders in Wisconsin and Illinois, and whether Oracle posts the roughly $7 billion of collateral the data-center tariff requires. The weather point held, in WEC's favor: a hot summer lifted Q3 and the full-year range. The other two are still open. Rate decisions are expected in Q4, and the earnings release says nothing about the Oracle collateral or the court challenge to the tariff. Q2's point about AFUDC also held: it nearly doubled again in Q3.

Takeaway: WEC's 42% EPS jump is mostly a hot summer on top of the planned rate increases. Weather-normal demand outside the data centers grew 0.4%. The raised $5.60–$5.64 guidance banks that weather, but it does not yet show the data-center build-out paying off at scale. That depends on the Q4 rate orders and on the very-large-customer contracts holding up.

Outlook

Guidance: 2026 EPS of $5.60–$5.64 (was $5.51–$5.61), assuming normal weather for the rest of the year. Nine-month EPS of $4.54 implies $1.06–$1.10 for Q4.

The longer-term case is unchanged from our Q2 report. Management's September plan calls for $37.5 billion of capital spending in 2026–2030 and 7–8% annual EPS growth, much of it for data-center customers such as Microsoft in southeastern Wisconsin and the Vantage/Oracle campus at Port Washington. This quarter shows the financing side of that plan: $358.7 million of new stock in Q3 alone, debt up $1.2 billion since December, and interest costs rising faster than revenue.

Our read: the raised guidance is credible because weather already banked it, but it says little about 2027. The things to watch in the 10-Q and in Q4 are how many dollars of margin the release's "favorable weather" was worth, how much data-center load added, the Wisconsin and Illinois rate orders for 2027, and any update on Oracle's collateral and the tariff litigation.

Source: WEC Energy Group earnings release (Exhibit 99.1 to Form 8-K, filed October 29, 2026). The Q3 Form 10-Q, with segment detail and the weather impact in dollars, had not been filed at the time of writing. Quarterly cash-flow figures are derived by subtracting the six-month figures in the Q2 2026 Form 10-Q.