IdaCorp Earnings Call Highlights Growth Amid CapEx Strain

IdaCorp ((IDA)) has held its Q1 earnings call. Read on for the main highlights of the call.

IdaCorp’s latest earnings call struck a cautiously optimistic tone as management highlighted solid EPS growth, expanding customer and industrial demand, and steady progress on a large slate of transmission and generation projects. While weather, higher costs, and credit pressure are weighing on near‑term results, leadership leaned on reaffirmed guidance and successful equity financing to argue that long‑term fundamentals remain attractive.

Earnings Growth and Reaffirmed Profit Targets

IdaCorp reported diluted EPS of $1.21 for Q1 2026, up from $1.10 a year ago, marking roughly 10% year‑over‑year growth and an increase in net income of more than $8 million. Management kept full‑year 2026 EPS guidance intact at $6.25 to $6.45, signaling confidence that current momentum can offset near‑term headwinds.

Customer Expansion and Industrial Load Surge

The customer base continued to expand, with overall counts up 2.3% year‑over‑year and residential customers rising 2.4%. Industrial energy sales climbed 5.7%, fueled by ramp‑ups from large users such as semiconductor and data‑center operators, underscoring Idaho’s appeal as a low‑cost, growth region.

Rate Increases and FCA Fuel Revenue Gains

Higher retail revenues, driven by a January rate increase and underlying customer growth, contributed about $23 million of benefit in the quarter. In addition, revenues under the company’s Fixed Cost Adjustment mechanism improved by more than $19 million versus 2025, providing an important lift to operating results.

Major Transmission and Generation Projects Advance

IdaCorp detailed notable progress on a suite of large infrastructure projects, including three major transmission lines and several generation assets. Roughly 15% of structures for the B2H line are complete with an in‑service target of late 2027, while the newly certificated SWIFT North line and advancing Gateway West segments could be online as early as 2028.

New Gas Plants and Storage Bolster Resource Plan

On the generation side, regulators approved a 167 MW Bennett Mountain gas plant slated for summer 2028, with follow‑on 222 MW and 430 MW gas projects targeted for 2029 and 2030. The company also expects about 250 MW of company‑owned battery storage to enter service this quarter and 125 MW of third‑party solar later in the year, broadening its resource mix.

Robust Growth Pipeline and IRP Upgrade Potential

Management emphasized a strong long‑term demand outlook, pointing to a multi‑gigawatt project queue and sustained customer interest across sectors. The company is currently planning around an 8.3% growth rate in its integrated resource plan and hinted this figure may be revised higher in the next cycle, reinforcing the case for continued system expansion.

Maintaining a Cost Advantage for Customers

Despite stepped‑up investment, IdaCorp stressed that its electricity rates remain 20% to 30% below the U.S. average, a key competitive selling point for both households and businesses. Over the past decade, the company’s rates have risen roughly 23%, versus a 41% national increase and a 36% jump in consumer prices, helping support affordability.

Regulatory Progress and Operational Approvals

The company reported a series of regulatory wins, including approval of its 2026 wildfire mitigation plan and its 2026–2032 resource request for proposals. Regulators also granted key certificates for certain transmission and generation projects, while filings tied to a planned sale of the Oregon service area remain pending, collectively underscoring constructive regulatory engagement.

Equity Financing and Capital Structure Discipline

IdaCorp continued to execute on its forward‑equity strategy, completing $155 million of at‑the‑market forward sales in Q1 and settling nearly $52 million from earlier deals. In total, more than $750 million of the roughly $2 billion planned equity issuance has now been settled or executed, supporting a targeted capital mix near 50% equity and 50% debt.

Weather‑Driven Demand Weakness Weighs on Q1

Unusually mild temperatures eroded usage per customer, cutting operating income by about $10.7 million versus the prior year and highlighting the company’s exposure to weather patterns. The same conditions contributed to a less favorable hydropower outlook this year, adding some uncertainty to near‑term earnings power.

Hydropower Outlook Narrowed Amid Variable Conditions

Management trimmed the upper end of its hydropower generation forecast, now expecting between 5.5 million and 7.0 million megawatt‑hours in 2026. The shift largely reflects low winter snowpack, partly offset by strong water storage and a record‑wet April, underscoring the inherent variability of hydro‑dependent resources.

Higher Operating and Financing Costs Emerge

Operating and maintenance expenses rose by $13.1 million year‑over‑year, driven mainly by wildfire mitigation work and amortization of deferred costs associated with growth. Depreciation and interest expense also moved higher, lifting nonoperating costs by about $4 million and reflecting the capital‑intensive nature of the company’s current build‑out.

Reduced Tax Credit Amortization Damps Support

Idaho Power used $6.3 million of additional tax credits in the quarter, roughly $13 million less than in Q1 2025, which meant less earnings support from accelerated tax benefits. Management framed the lower amortization as a by‑product of improved underlying performance, but investors should note that this tailwind is smaller than last year.

Moody’s Downgrade Highlights Credit Sensitivity

Moody’s cut the holding company’s rating to Baa3 and the utility’s rating to Baa2, citing an elevated capital spending cycle and weaker near‑term credit metrics. In response, management reiterated that continued equity issuance is essential to protecting balance sheet health and preserving funding flexibility for its growth plan.

Large CapEx Plan Brings Execution Risk

The company’s capital program remains sizable, with 2026 spending projected between $1.3 billion and $1.5 billion and multi‑year needs of about $2.0 billion in equity and $2.9 billion in debt. Several major projects still require federal approvals and are subject to supply‑chain and turbine procurement constraints, adding construction and financing risk that investors will monitor closely.

Regulatory Timing and Rate Case Uncertainty

Management signaled it is unlikely to pursue a general rate case in 2026, preferring to time filings around load growth and when new assets enter service. That stance introduces some near‑term uncertainty about the pace of cost recovery, even as regulators have been supportive on individual projects and long‑term planning.

Guidance and Outlook Reinforce Long‑Term Growth Story

Looking ahead, IdaCorp reaffirmed 2026 EPS guidance of $6.25 to $6.45, assuming normal weather and typical power supply costs, and guided full‑year operating and maintenance expenses to $525 million to $535 million. With 2026 capital spending still targeted at $1.3 billion to $1.5 billion, hydropower output narrowed to 5.5 million to 7.0 million megawatt‑hours, and an 8.3% growth assumption backed by a roughly 4,000 MW pipeline, management argued the utility is well positioned for sustained expansion despite the need for substantial equity and debt financing.

IdaCorp’s call painted a picture of a utility in the middle of a heavy but opportunity‑rich build‑out, balancing strong growth and competitive rates against higher costs and tighter credit metrics. For investors, the story hinges on management’s ability to execute its large capital program, manage financing needs, and navigate weather and regulatory variability while delivering on its reaffirmed earnings targets.