Overview
Revenue grew 13.0% year over year, EPS beat the estimate by 13.5%; the stock rose 0.2% in its first reaction.
- RevenueQ3
- $8.84B
- Estimate $8.47B · Beat by 4.4%
- EPSAdjusted
- $1.94
- Estimate $1.71 · Beat by 13.5%
Verdict
BUYSouthern Company beat third-quarter estimates, with adjusted EPS of $1.94 topping expectations by 13.5% and revenue of $8.84B beating by 4.4%. The company now expects 2026 EPS of $4.70, 10 cents above the top of its old range. The stock closed up only 0.2%, because its $0.30 fourth-quarter figure sits 28.6% below expectations.
Close on Report DayNov 5
$93.34▲ 0.2%Report-Day Move
- Market Cap(Today)
- ≈ $107 B
- 1Y Return(At Report)
- + 2%
- P/E(At Today's Price · $4.94 · Trailing 12M)
- 18.9
- PEG(Company Guidance 2026)
- 2.03
- Net Margin(Trailing 12M)
- 16.1%
Earnings Summary
In 30 Seconds- Adjusted EPS of $1.94 beat estimates by 13.5%, and revenue of $8.84B beat by 4.4%.
- The company raised its 2026 figure to $4.70 but expects only $0.30 for the fourth quarter.
- The stock closed up just 0.2% on the view that year-end earnings shifted into the third quarter.
The Numbers
GAAP EPS
$1.77
▲ 14.2% YoY
2026 EPS Outlook
$4.70
Estimate $4.59 · 2.4% Above
Weather-Adjusted Retail Sales
▲ 3.5%
Including Weather ▲ 7.7%
Stock Reaction
▲ 0.2%
Close to Close · Intraday High ▲ 2.8%
Quarterly Revenue ($ Billion)
7.82
Q3 25 · $7.82 B
6.98
Q4 25 · $6.98 B · QoQ − 10.8%
8.40
Q1 26 · $8.40 B · QoQ + 20.3%
6.98
Q2 26 · $6.98 B · QoQ − 16.9%
8.84
Q3 26 · $8.84 B · QoQ + 26.7% · YoY + 13.0%
- Q3 25
- Q4 25
- Q1 26
- Q2 26
- Q3 26
Q4 2026 Company Guidance
- 2026 Adjusted EPS4.7 $
Prior Range 4.50–4.60 · Market Expectation 4.592.4% Above Estimate ▲
- Q4 26 Adjusted EPS0.3 $
Last Year 0.55 · Market Expectation 0.4228.6% Below Estimate ▼
- Long-Term EPS Growth7% – 8%7%8%
From 2028, Off a Higher Base
How to Read the Chart
The blue band is the company's low-high range; its length shows how much room the company left itself. The black triangle and the line beneath it mark where the market expected, and the notch in the band is the range's midpoint. The triangle appears only where a market expectation is known. When the company gave a single number rather than a range and no market expectation is known, that row gets no band at all: there is no length to measure and no position to compare. Axis is ±46% around the midpoint.
Company-Specific Metrics
Weather-Adjusted Retail Sales Growth
3.5%
Press Release
Georgia Power Net Income
$1.52 B
▲ 22.0% YoYPress Release
Alabama Power Net Income
$661 M
▲ 12.4% YoYPress Release
Metrics come only from the company's own filings; each one names the document it was taken from.
“The Southeast is growing at a pace that is both unprecedented and transformational, and we believe Southern Company is well positioned for today and in the future. Our scale, our experience and our customer-focused strategy allow us to serve this growing demand in a responsible and sustainable manner. We know how important reliable energy is to our customers.”
- Data Center Usage
- 21 GW of Large-load Contracts
- Higher 2027-2028 Targets
Summary and Review
Summary
Southern Company reported third-quarter operating revenue of $8.84B. That is up 13.0% year over year. Revenue beat the $8.47B market expectation by 4.4%, so the revenue gate is open. Adjusted EPS was $1.94 against a $1.71 estimate, opening the earnings gate by 13.5%. Nine-month adjusted EPS rose 17.0% to $4.40. The company expects 2026 adjusted EPS of $4.70. That is 2.4% above the $4.59 estimate, so the guidance gate is open too.
The stock closed at $93.34, up 0.2%. It rose as much as 2.8% to $95.72 during the day, then slipped to $91.93. The market read this report as a year-end story. The company's fourth-quarter EPS figure of $0.30 sits 28.6% below the $0.42 estimate. So part of the year's upside appears to have shifted into the third quarter. The stock has gained only 2.1% over the past year and sits 2.9% below the average analyst target.
Score 80, verdict buy. All three gates are open, but the score sits at the bottom of its band. Revenue, earnings and the full-year outlook all beat expectations. But there are three caveats. Part of the profit came from a hot summer. The fourth-quarter figure sits well below the market. The share count also rose 5.0% year over year, diluting earnings per share. On the other hand, data center usage is growing fast and weather-adjusted sales rose 3.5%. Signed large-load contracts also support the growth plan.
Full Review
Georgia Power is at the center of profit.
Georgia Power's net income was $1.52B. A year ago it was $1.25B, a 22.0% increase. Alabama Power's profit rose 12.4% to $661M. Southern Power's profit climbed from $3M to $52M. The gas unit's profit fell 16%, from $25M to $21M. The loss at the parent and other items widened from $237M to $299M. According to the release, warmer weather, higher usage and customer growth drove earnings. Revenue from large commercial and industrial customers also grew. Higher non-fuel operating expenses, taxes and dilution from new shares limited the gain.
Sales grow even without the weather.
Total retail electricity sales rose 7.7% year over year. Adjusted for weather, the gain was 3.5%. Commercial sales grew fastest, up 7.3% on a weather-adjusted basis. Residential sales rose 10.2%, but only 1.3% after adjusting for weather. That gap shows most of the residential jump came from the hot summer. The commercial growth comes from data centers. According to the earnings call, data center usage rose 59% year over year this quarter. It is up 52% year to date. Nine-month weather-adjusted retail sales rose 2.7%, so growth accelerated in the third quarter. Signed large-load contracts total 21 gigawatts. About 7 more gigawatts are in late-stage talks. These contracts are not yet running at full capacity. For a utility, that means years of rate base growth.
Full-year outlook up, fourth quarter low.
In February the company guided to 2026 adjusted EPS of $4.50-$4.60. It now expects $4.70. That is 10 cents above the old top end and 9.3% growth over 2025's $4.30. It earned $4.40 in nine months, versus $3.76 a year earlier. The $0.30 fourth-quarter figure, however, is 45% below last year's $0.55. The estimate was $0.42. Nine-month revenue also rose 7.3% to $24.2B. So the annual target went up, but the timing of earnings shifted. Management said it may also raise the top of its 2027 and 2028 ranges. The 7-8% growth target after 2028 will now start from a higher base. Detailed numbers will come on the fourth-quarter call in February.
Capital plan and equity issuance.
The base capital plan announced in February was $81B. The company added about $4B in new projects on top. According to the earnings call, the plan could approach $100B over five years. That size requires funding. The average share count rose 5.0% in a year, from 1.10B to 1.16B. The company says it has a remaining equity need of about $2B through 2030. That means remaining dilution should be limited. For utilities, the rate base is the engine of profit. But the cost of funding that base determines per-share growth. The quarterly dividend is $0.76, and the company has raised it for 25 years.
Next quarter, watch one line.
Next quarter, watch one number: fourth-quarter adjusted EPS. If it comes in above $0.30, the company will have beaten its $4.70 full-year figure. That would give a solid base for raising the 2027 and 2028 ranges. If it falls below $0.30, part of the third-quarter upside will read as a temporary weather gain. The second measure is weather-adjusted sales growth. When the weather normalizes, this line has to carry growth. Staying above 3.5% would show the data center story reaching the numbers. As the capital plan grows, cash must grow too; see the cash flow guide. For a general method of reading earnings day, see the guide.
Looking Ahead
Strengths and Risks
5 Strengths · 5 RisksStrengths
5- Adjusted EPS rose 21.3% year over year to $1.94, beating estimates by 13.5%.
- Revenue rose 13.0% year over year to $8.84B, beating estimates by 4.4%.
- The company lifted its 2026 figure to $4.70, 10 cents above the old top end.
- Georgia Power's net income rose 22.0% year over year to $1.52B.
- According to the earnings call, data center usage rose 59% year over year.
Risks
5- The $0.30 fourth-quarter EPS figure sits 28.6% below expectations.
- Most of the 10.2% rise in residential sales came from hot weather.
- The average share count rose 5.0% year over year, diluting earnings per share.
- A capital plan approaching $100B raises debt and funding needs.
- The stock sits just 2.9% below the $96.05 average analyst target.
What to Watch
2- The company will pay its $0.76 quarterly dividend on December 7 to holders of record on November 16.
- Fourth-quarter earnings and a new plan through 2031 are expected in February 2027.
Upcoming Earnings
To Understand This