I'll research Southern Company (SO) ahead of their earnings report. Let me gather relevant data from recent filings, transcripts, and news.# Southern Company (SO) — Q2 2026 Earnings Preview Report date: July 30, 2026 (before market open call at 1:00 p.m. ET) | Last close: ~$95.99 | Event: 2026Q2 Earnings Call
Southern Company enters this print in rare form for a regulated utility: management has raised its long-term earnings algorithm twice in the last two quarters on the back of an unprecedented data-center/large-load demand wave across the Southeast, while simultaneously locking in multi-year rate freezes for existing customers. The stock has held up well, trading around $96, up roughly 10% year-to-date from the ~$87 level at the start of January.
Management's own guidepost for this quarter: adjusted EPS of $1.00, which it provided explicitly on the Q1 call. That compares with $0.92 adjusted EPS in Q2 2025, implying ~8.7% year-over-year growth. On a GAAP basis, Q2 2025 was $0.80, so watch the size and nature of any excluded items again this quarter (debt extinguishment costs, accelerated depreciation from wind repowering, etc., have been recurring "excluding items" categories).
Southern beat its own estimate last quarter, reporting adjusted EPS of $1.32, $0.09 above Q1 2025 and $0.12 above guidance, with growth across all major business units. First-quarter weather-normal retail sales were up 2.3%, the strongest first-quarter reading in recent history, driven by commercial-class growth of 4.5% (data center usage +42% year-over-year) and continued residential in-migration (46,000 net new customers). Southern Power and the gas utilities also contributed positively. This sets a high bar and reinforces guidance credibility heading into Q2.
The headline number for the print isn't just the quarter — it's whether Southern stays on track for: - 2026 adjusted EPS guidance: $4.50–$4.60 (roughly 7% growth off 2025's top-of-range $4.30 actual) - 2027 initial guidance: $4.85–$4.95 (~8% growth) - 2028 initial guidance: $5.25–$5.45 (~9% growth) - Longer-term: 7%–8% annual growth beyond 2028, averaging ~8% CAGR from the 2026 midpoint through 2030
2025 was the 11th consecutive year Southern delivered adjusted earnings at or above the top of its guidance range — a track record investors will be watching to see extended. Given Q1's beat and the $1.00 Q2 estimate, first-half 2026 adjusted EPS would land near $2.32 versus $2.15 in H1 2025, tracking comfortably toward the low-to-mid end of the raised full-year range, with normal seasonal strength expected in Q3 (peak cooling season).
This is arguably the single biggest swing factor for the long-term thesis. As of Q1 2026, Southern had more than 11 GW of fully contracted large-load agreements across Alabama, Georgia and Mississippi (2 GW signed in just the prior two months), with another 12 GW in "late-stage" discussions, roughly half of which management expects to convert to signed contracts "in the near term." The total prospective pipeline stood at over 75 GW. Watch for: (1) an updated contracted-GW figure, (2) commentary on whether the ~6 GW of near-term late-stage deals converted, and (3) any read-through from Georgia Power's newly initiated all-source RFP for 2–6 GW of new generation (2032–2033 timeframe), which could add meaningfully to the capital plan if company-owned resources are selected.
Southern's base 5-year capital plan sits at $81 billion, up ~30% from a year earlier, with $42 billion earmarked through 2030 for growth-related generation, transmission and pipeline investment. On financing, the recently announced $26.5 billion in DOE loan agreements for Alabama and Georgia are expected to generate cumulative customer savings of roughly $7 billion over the ~30-year loan term while reducing pressure on capital markets needs. Remaining equity/equity-equivalent needs have been narrowed to approximately $1.8 billion through 2030 (down from ~$2 billion at year-end), with incremental capital continuing to be funded at roughly a 40% equity ratio. Southern remains focused on reaching 17% FFO-to-debt by 2029. Any update on ATM issuance pace, the DOE loan drawdown schedule, or credit-rating commentary would be notable.
Georgia and Alabama base rates are frozen through 2028/2029 under multiyear stability agreements, and Georgia Power has filed to lower rates tied to fuel and storm-cost recovery this summer — a proof point management leans on heavily to argue that large-load growth is subsidizing, not burdening, existing customers. Two Georgia PSC seats were up for election in 2026 (primary in May, runoff in June), and commentary around affordability politics and data-center siting/zoning debates in Georgia remains a background risk worth monitoring, even though management has expressed confidence it can work constructively regardless of election outcomes.
Southern Power posted a GAAP pretax loss of $84 million in Q1 2026 (net income of only $4 million, down from $87 million a year earlier), driven largely by accelerated depreciation tied to wind-repowering projects (an adjusted-earnings add-back). At the same time, Southern Power is pursuing 400 MW of gas turbine uprates (~$700 million of incremental capex, in service 2029–2031) with another 300 MW under evaluation, and management continues to flag substantial repricing upside as legacy gas contracts roll off in the early-to-mid 2030s at prices reportedly 2–3x current levels. Expect continued disclosure on repowering charge cadence (still running through Q3 2027) and progress on new contracts.
Milder-than-normal weather was a modest drag in both Q1 2026 and Q2 2025, so weather-normalized sales growth (rather than headline growth) will be the cleaner read on underlying demand. 2025 saw full-year weather-normalized retail sales growth of 1.7% — more than double the prior decade's average — and management is guiding to at least 3% retail sales growth in 2026 and roughly 10% average annual growth from 2026–2030 for the electric operating companies, with Georgia Power's total retail sales growth projected near 13% over that stretch.
The board just approved a $0.08 per-share increase, taking the annualized dividend to $3.04, marking the 25th consecutive annual increase and extending Southern's streak of paying a stable-or-higher dividend to 79 consecutive years. Management has also flagged the potential to accelerate dividend growth later in the plan as the payout ratio migrates toward the low-to-mid 60% range — a topic that could resurface on this call.
Southern comes into this print with strong momentum: a Q1 beat, an upsized and extended multi-year EPS growth algorithm (7–9% through 2028, 7–8% longer term), a rapidly growing contracted large-load book (11+ GW signed, 12 GW late-stage), a historically low-risk financing picture bolstered by the DOE loan program, and a 25th straight annual dividend increase. The bar for Q2 itself is fairly clear-cut — $1.00 adjusted EPS — so the more important signals for investors will likely come from updates on large-load contract conversion, the Georgia/Alabama RFP processes, Southern Power's repowering/uprate cadence, and any incremental commentary on capital plan growth or credit metrics as Southern continues to scale its balance sheet to match one of the most aggressive multi-year investment programs among U.S. regulated utilities.