Timing clarification: FirstEnergy is scheduled to release 2Q26 results after the market closes today, Tuesday, July 28, 2026. Its earnings call is tomorrow, Wednesday, July 29 at 9:00 a.m. ET—not July 28.
FirstEnergy enters 2Q with a largely intact regulated-utility growth narrative: an expanded $36 billion, 2026–2030 Energize365 capital plan, a $6 billion 2026 CapEx target, formula-rate-heavy transmission exposure, improving operating discipline, and potentially material upside from data-center-related load and generation development in West Virginia.
The near-term setup, however, is more nuanced than a simple EPS beat/miss. Management said in April that most of the remaining year-over-year earnings growth versus 2025 would arrive in the second half of 2026. Accordingly, investors should focus less on whether 2Q alone looks optically strong and more on whether the quarter supports continued confidence in:
| Item | Current position |
|---|---|
| 1Q26 Core EPS | $0.72, up 7.5% year over year |
| 1Q26 GAAP EPS | $0.70 |
| 2026 Core EPS guidance | $2.62–$2.82 |
| 2026 CapEx plan | $6.0 billion |
| 2026–30 capital plan | $36 billion, implying approximately 10% rate-base CAGR through 2030 |
| Long-term Core EPS outlook | 6%–8% CAGR through 2030; management targets the upper end |
| 1Q26 capital deployed | Nearly $1.4 billion, +33% year over year |
| Balance-sheet backdrop | Moody’s revised FE’s outlook to positive in March, while affirming its Baa3 rating |
| Stock setup | FE closed at $49.33 on July 27, essentially flat versus its $49.58 close immediately before 1Q results on April 28 |
For context, FE reported 2Q25 Core EPS of $0.52. That quarter benefited from Pennsylvania base rates and transmission rate-base growth, but faced a roughly 3% demand headwind from milder weather. A year-over-year improvement in 2Q26 would be constructive, but the more important question is whether management preserves its full-year outlook and the expected second-half acceleration.
The core thesis is still regulated investment-led earnings growth. In 1Q:
A solid 2Q should show continued capital deployment, rate-base growth, and evidence that capitalized financing costs are helping offset the interest burden associated with funding the program.
What would be positive: reaffirmed CapEx, continued double-digit transmission rate-base growth, and no signs of supply-chain or labor constraints affecting project timing.
What would concern investors: any slowing in deployment, reduced expectations for formula-rate returns, or higher financing costs that meaningfully dilute investment-driven earnings.
FirstEnergy’s 1Q result was aided by lower base O&M and by management’s multi-year efficiency program. The company said base O&M has fallen by more than $200 million, or 15%, since 2022, and was down nearly 5% year over year in 1Q.
That said, storm expense is the key counterweight. In 1Q, FE saw substantial storm-restoration costs, much of which was deferred for recovery, but some costs were not deferred. Storm activity can therefore affect both near-term earnings and the size of regulatory assets.
Investors should look for:
The regulatory-asset balance is worth monitoring. At March 31, FE had $1.643 billion of regulatory assets not currently earning a return, including $952 million of storm-related costs. The growth plan is stronger if deferrals remain recoverable and are converted to cash flow on the expected timetable.
The most consequential strategic item is FE’s proposed 1.2 GW combined-cycle gas plant plus 70 MW of solar in West Virginia. The February CPCN filing contemplated approximately $2.7 billion of investment, including a mechanism intended to recover financing costs during development and construction.
At the 1Q call, management expected a West Virginia Public Service Commission order in the second half of 2026—potentially early in 4Q—and suggested approval would increase rate-base growth from just above 10% to just above 11%.
The strategic upside is amplified by load growth:
Questions for the call:
Management had previously indicated that up to roughly 35% of the West Virginia generation investment could require new equity, although AFUDC cash recovery could fund part of the build. That makes the financing plan and dilution guardrails important.
FE’s investment plan depends on constructive regulation, but affordability has become a prominent issue across its footprint.
FE planned to file a three-year rate plan in May that would support roughly $800 million of annual investment, with new rates expected in mid-2027. The company has also been managing the aftermath of Ohio regulatory proceedings, including customer restitution and refunds that began in February.
Key issue: whether Ohio regulatory developments remain consistent with the company’s targeted returns and ongoing distribution-investment program.
FE expected to file West Virginia and Maryland distribution rate cases in 2026, with new rates targeted for 1Q27. These cases matter for converting accumulated investment into earnings and cash recovery.
Pennsylvania’s infrastructure programs and rider recovery are central to FE’s capital plan. At the same time, management has emphasized customer affordability and the need to avoid regulatory surprises.
The immediate overhang is JCP&L reliability. In April, New Jersey Board of Public Utilities staff indicated an intention to recommend a $44 million penalty relating to reliability performance. FE disputes the recommended magnitude and was discussing potential resolution. Any update on a settlement, penalty, or remediation plan is likely to draw attention.
FE’s footprint sits in the middle of the PJM supply-demand imbalance. Higher capacity prices and load growth reinforce the need for transmission and generation investment, but they also intensify affordability pressure for customers and regulators.
The latest PJM capacity auction cleared near the temporary price cap, and PJM again fell short of its reliability requirement. For FE, the direct earnings impact is muted in many areas because certain commodity costs are passed through or deferred, but the broader implications matter:
Management has been explicit that large-load customers should pay their full share for required system upgrades—and that utilities should earn a return on capital deployed to serve them. Investors should watch for any indication that FERC/PJM policy could weaken, rather than reinforce, that model.
This should be viewed as a strategy-validation quarter, rather than merely a quarterly EPS event. FirstEnergy’s investment case rests on disciplined execution of a large, mostly regulated capital plan and on its ability to convert load growth—especially in West Virginia and across PJM—into rate-base growth without undermining affordability, credit quality, or shareholder dilution.
The most constructive outcome would be a clean reiteration of $2.62–$2.82 in 2026 Core EPS, confirmation that capital deployment remains on pace, sustained O&M discipline, and more concrete evidence that the West Virginia/data-center opportunity can be added to the plan on attractive regulatory and financing terms.