PEG · Q4 2025 Earnings

Bullish

Public Service Enterprise Group

Reported February 26, 2026

30-second summary

PSEG closed FY2025 at $4.05 non-GAAP EPS — landing at the top of the narrowed $4.00–$4.06 guide — initiated FY2026 at $4.28–$4.40 (~7% growth at the midpoint), and raised the long-term non-GAAP earnings CAGR to 6–8% through 2030 from 5–7% through 2029. The five-year capital program was rebased to $24–28B for 2026–2030 ($22.5–25.5B regulated), funded without new equity or asset sales, and management framed nuclear contracting and incremental regulated investment as the levers for upside above the 6–8% range. The story has shifted from "will load convert" to "how much earnings power can be locked in via contracts the new New Jersey administration is just beginning to authorize."

Headline numbers

EPS

Q4 FY2025

$0.72

Revenue

Q4 FY2025

$2.92B

+18.2% YoY

Operating margin

Q4 FY2025

17.5%

Key financials

Q4 FY2025

Metric	Q4 FY2025	YoY	Q3 FY2025	QoQ
Revenue	$2.92B	+18.2%	$3.23B	-9.6%
EPS	$0.72	—	$1.13	-36.3%
Operating margin	17.5%	—	26.5%	-897bps

Guidance

PSEG raised full-year 2026 EPS guidance to $4.28–$4.40 (+5.7% to +8.6% YoY) and upgraded long-term earnings growth outlook to 6–8% CAGR through 2030 (vs. prior 5–7% through 2029), signaling confidence in nuclear generation contracts and regulated investment momentum.

Guidance is issued for the full year only, refreshed each quarter. Prior and new below are the same FY updated this quarter.

Actuals vs prior guidance

Metric	Period	Prior guide	Actual	Δ	Result
Non-GAAP Operating Earnings Per Share	FY2025	$4.00 to $4.06	$4.05	at high end of narrowed guide	Beat

New guidance

Metric	Period	Guide	YoY
Non-GAAP Operating Earnings Per Share	FY2026	$4.28 to $4.40	+5.7% to +8.6%
Rate Base CAGR	FY2030	6% to 7.5%	—
2026 Regulated Capital Investment	FY2026	~$4.2 billion	—

Changes to prior guidance

Metric	Period	Prior guide	New guide	Δ	Result
Long-Term Non-GAAP Operating Earnings Growth	FY2030	5% to 7% CAGR (FY2025–FY2029)	6% to 8% CAGR (FY2025–FY2030)	+1 percentage point at both low and high end	Raised
Regulated Capital Investment	FY2029	$22.5 billion to $26 billion (FY2025–FY2029)	$22.5 billion to $25.5 billion (FY2026–FY2030 regulated component)	prior range midpoint $24.25B vs. current range midpoint $24.0B; however, plan extends to 2030 and includes total capex of $24B–$28B	Raised

Segment KPIs

Q4 FY2025

Segment	Q4 FY2025	YoY
PSE&G	$2.328B	+10.1%
PSEG Power & Other	$0.961B	+44.1%

Other KPIs

Q4 FY2025

Segment	Q4 FY2025
Nuclear Capacity Factor	91.2%
Nuclear Generation (Full Year)	30.9 TWh
Electric Customers (Millions)	2.4
Gas Customers (Millions)	1.9
Operating Income Margin (Q4)	17.5%
2026 Guided EPS Growth	7% midpoint
2026-2030 Rate Base CAGR	6.0%-7.5%
2026-2030 Long-Term EPS Growth	6%-8% CAGR

Management tone

Pipeline build-out → capex raise and policy advocacy → growth-story selling → growth optionality and capacity to compete.

Three quarters ago management was selling a 9,400 MW inquiry pipeline as evidence that demand was real. Last quarter the language hardened into policy advocacy as the gubernatorial transition loomed. This quarter the tone has shifted again: management is no longer asking for a policy framework — they are pitching themselves as the supply solution. "We have sites with grid connection capability and pipeline supplies as well as the in-house expertise to build new supply here in New Jersey with prevailing wage labor." That sentence is a marketing pitch to the new administration, and it signals PSEG believes the procurement window is opening and they intend to be first in line.

Nuclear has been steadily reframed across four quarters — from baseload, to PTC-protected cash generator, to "scarcity value" asset, and now to explicit earnings lever. "This regulated growth is supported by nuclear generation ownership, a significant cash flow generator, and therefore a differentiator among our peers. Potential growth beyond our forecasted 6% to 8% CAGR range could be achieved through opportunities to contract existing and additional generating output." The new piece is "additional generating output" — i.e. uprates and potentially new builds — being explicitly tied to upside above an already-raised CAGR. Two quarters ago this would have read as aspirational; with the federal PTC floor locked in and the long-term guide raised, it now reads as a quantifiable optionality argument.

The capital plan messaging hardened in a quieter way. Q3 raised the five-year envelope to $22.5–26B with the equity-free funding line repeated. This quarter the headline number is $24–28B for 2026–2030, but the regulated midpoint is essentially flat with the prior plan — the raise is in the unregulated bucket. Management did not flag this in the prepared narrative; it is visible only in the side-by-side. The signal is that incremental regulated capex requires policy outcomes that haven't landed yet, while management wants the headline to read like an acceleration.

Dividend growth accelerated from $0.12 to $0.16 (~6%), explicitly attributed to "confidence in our long-term projections." Utilities rarely accelerate dividend growth year-over-year without a multi-year earnings visibility argument. Combined with the CAGR raise to 6–8% and the 21-year guidance delivery streak, this is management putting capital where the talking points are.

The most evasive area in Q&A was merchant generation earnings above the PTC floor. Management repeatedly declined to specify what merchant assumption is embedded in the 6–8% CAGR, deferring to "market signals" and the hedging stack. This is the gap between the bull case (uprates + contracting + higher PJM curves) and the disclosed earnings base — and management is keeping that gap private on purpose.

Recurring themes management leaned on this quarter:

operational excellence and reliability (24th consecutive year top performer, #1 customer satisfaction 4 consecutive years)capital investment acceleration driven by data center demand and infrastructure modernizationnuclear generation as strategic differentiator with hedging and contracting optionalityregulatory partnership with New Jersey on affordability and energy supply solutionsbalance sheet strength enabling capex execution without equity dilution or asset salesdividend growth acceleration reflecting management confidence in long-term projections

Risks management surfaced:

Severe weather and extreme weather events throughout 2025 stressing electric and gas systemsPJM-related electric supply costs passed through to customersInterest rate risk on refinancing maturities at higher current ratesRegulatory execution risk on legislative proposals for natural gas and nuclear procurement programsHedging and market price exposure for nuclear output (though 95% hedged for 2026)

Q&A highlights

Char Peruzza · Wells Fargo

Timing of legislative bills enabling new gas and nuclear, IRP process structure, PPA returns, air permits, and turbine backlogs. Also asked about hedge levels and PTC upside embedded in 6-8% CAGR guidance.

Management explained that multiple bills are in play in New Jersey legislature to enable new nuclear and gas. Policymakers must work through variables like turbine backlogs and air permits. An IRP process could be helpful but doesn't drive output. On hedging: 2026 is 95% hedged, next couple years well hedged but less so in out years, relying on market views informed by PJM fundamentals.

2026 approximately 95% hedged2027 and 2028 less hedged than 20266-8% CAGR guidance includes market view assumptions for out yearsMultiple bills floating in Trenton to enable new nuclear and gas

Nick Campanella · Barclays

Whether 6-8% CAGR is linear or nonlinear, positioning within range for 2027-2028, and updated thoughts on nuclear data center contracting given change in New Jersey administration.

Management stated goal is to be as linear as possible, though structural changes may occur. Supply-demand curve changes have pushed results above floor. On data centers: Pennsylvania offers more near-term opportunity than New Jersey given current administration focus on staffing and budget. Smaller New Jersey locations and PA facilities are more fertile ground. Noted new administration prioritizing staffing and budget before economic development.

Goal to achieve linear earnings within 6-8% rangeSupply-demand curve structural change drove upward revisionPennsylvania facilities more viable for large-scale opportunitiesNew administration priorities: staffing, budget, then economic development

Tanner James (Julian) · Jefferies

VPU and legislative process overlap and timeline, breakdown of 2026 guide between regulated utility and power, and hedging positions relative to floor.

Management noted give-and-take as new administration and legislature find footing. BPU has some existing authority but needs legislative direction for cleaner processes. Can't commit to 30-day or 6-month timeline for bills. Load increases across PJM impacting New Jersey pricing. On earnings mix: won't break down beyond overall guidance; 2026 is 95% hedged, 2027 largely hedged, 2028 uses ratable three-year approach with most liquid curve, 2029-2030 more subject to market forces.

Two bills recently introduced directing BPU actionsTimeline for legislative action uncertain (not 30-60 days)Load increases happening across PJM affecting New Jersey pricing2026: 95% hedged

Bill Apicelli · UBS

Incremental regulated capital investments (what buckets, what projects), O&M cost assumptions in 6-8% plan, and timing of labor agreement renegotiations.

Three capital buckets identified: (1) incremental transmission in PJM region, particularly Maryland; (2) New Jersey solar readiness for distribution system upgrades (BPU ongoing process); (3) potential generation opportunities pending policy decisions. Base capital plan excludes large single projects—mainly end-of-life infrastructure replacement. O&M built on 3% inflation assumption, pulled back to 2-2.25% through efficiencies. Labor agreements running through 2027 will be renegotiated with costs embedded in plan.

Three capex buckets: PJM transmission, NJ solar readiness, potential generation90% of capex tied to end-of-life replacementBase capital plan does not include large new projectsO&M starts at 3% inflation, pulled back to 2-2.25%

Michael Sullivan · Wolf Research

Whether 90% regulated earnings mix from prior guidance still holds, and rate base CAGR composition.

Management noted the 90% regulated figure could go down if power prices increase (which they hope happens). Argued merchant business above PTC floor acts like regulated return given PTC as federal-regulated floor. Won't disclose specific merchant assumption above PTC. Rate base continues growing 6-7.5% CAGR on a growing higher base, implying slightly higher absolute growth than headline CAGR.

90% regulated mix could decline if power prices riseMerchant returns above PTC floor described as 'regulated-like' risk profileRate base growing 6-7.5% CAGRUtility side continues doing what it does; modest shifts from power price upside possible

Answers to last quarter's watch list

February 2026 capital update — Five-year envelope raised to $24–28B total (2026–2030), but the regulated component midpoint ($24.0B) is marginally below the prior $24.25B regulated midpoint. The headline reads as an acceleration; the regulated detail does not. No separate contracted-load line was disclosed from the mature 2,800 MW bucket — management redirected to pipeline composition rather than conversion. Status: Resolved negatively

NJ gubernatorial transition and IRP signals — Multiple bills are floating in Trenton to enable new nuclear and gas procurement, but management refused to commit to a 30–60 day or 6-month timeline. New administration is focused on staffing and budget before economic development. Management's pivot to flagging Pennsylvania as "more fertile ground" is the clearest tell that NJ procurement timeline has slipped further. Status: Resolved negatively

December 2025 PJM capacity auction clear — Management referenced the RPM collar at $420/MW-day in Q&A but did not provide a specific cleared price or quantify the bill impact for June 2026 BGS rates. The collar argument appears to be holding but verification awaits the BGS print. Status: Continue monitoring

Nuclear multi-year contracting — No first contract announced. Management explicitly named contracting of existing and additional nuclear output as the upside lever above 6–8% CAGR, but provided no counterparty, term, or pricing. The framing escalated from "concept" to "explicit upside lever," but no transaction. Status: Continue monitoring

Mature application conversion ratio — Management did not disclose movement of the 2,800 MW mature application bucket into contracted load. The 11 GW pipeline figure was not refreshed in the press-release detail available. This was the single biggest disclosure gap on the print and the redirect to Pennsylvania suggests NJ conversion is slower than management implied last quarter. Status: Resolved negatively

What to watch into next quarter

First nuclear multi-year offtake announcement: management has now named contracting as the explicit upside lever above 6–8% CAGR for two consecutive quarters. Watch the Q1 print for a counterparty, term length, and pricing structure (fixed, indexed to PJM, or PTC-floor reference).

NJ procurement mechanism crystallization: watch whether the bills "floating in Trenton" coalesce into a single BPU directive, RFP, or auction structure within the next 90 days, and whether PSE&G is named as a participating entity rather than just a stakeholder.

Q1 2026 EPS pace against the $4.34 midpoint: PSEG is non-seasonal but Q1 is historically the largest contribution quarter. Watch whether Q1 lands above $1.50 (Q1-2025) — a flat or down Q1 would put pressure on the full-year guide despite the streak.

Regulated capex line tracking to ~$4.2B: 2026 regulated investment guidance was newly disclosed at ~$4.2B. Watch the Q1 print for actual quarterly spend pacing vs. the implied $1.05B quarterly run-rate, since the regulated midpoint over five years is essentially flat with the prior plan.

Hedge disclosure for 2027: management said 2027 is "largely hedged" but provided no percentage. A specific number on the Q1 call would compress merchant uncertainty in the 2027 earnings bridge.

Sources

PSEG Q4 2025 press release, SEC Form 8-K Exhibit 99: https://www.sec.gov/Archives/edgar/data/788784/000119312526073678/d57788dex99.htm
Q4 2025 earnings call Q&A and prepared remarks (as referenced in tone and Q&A extractions)
Tapebrief PEG Q3-2025 brief (prior quarter watch list and trend baseline)
Tapebrief PEG Q2-2025 brief (multi-quarter narrative baseline)

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