NorthWestern Energy (NWE) Q3 2026: Colstrip Stake Hits EPS Hard

NorthWestern Energy Group reported third-quarter 2026 adjusted earnings per share of $0.58, missing expectations of $0.73. The gap traced almost entirely to the expanded stake in the Colstrip coal plant that NorthWestern acquired at no cost on January 1, 2026, which produced a $6.1 million net GAAP loss in the quarter. GAAP diluted EPS landed at $0.50, down from $0.62 in the same period a year earlier.

The Colstrip drag is structural in the near term. Pacific Northwest power prices have remained too low to recover operating costs under the interim PCCAM tariff waiver, meaning the company cannot pass those expenses through to ratepayers for now. Operating and maintenance expense rose to $84.9 million from $64.1 million in the prior-year quarter, with Colstrip-related generation maintenance a primary contributor. Higher depreciation and interest expense from plant additions and increased borrowings added further pressure, pushing operating income down 7.1% year over year.

NorthWestern posted $423.8 million in quarterly revenue, beating estimates of $412.5 million and rising 9.5% from a year earlier. Utility margin climbed to $316.5 million from $300.0 million, helped by electric margin from the Colstrip Puget Interests acquisition and gains from electric transmission revenue and retail volume growth. Management characterized core utility earnings as intact and reaffirmed the 2026 non-GAAP EPS guidance range of $3.68 to $3.83 per diluted share.

The bigger near-term catalyst is regulatory rather than operational. The Montana Public Service Commission is expected to rule on NorthWestern's proposed all-stock merger with Black Hills Corporation before November 12, 2026, the last major hurdle before the two utilities combine to form Bright Horizon Energy Corporation. CEO Brian Bird noted the company is "excited about the prospect of completing our merger with Black Hills and beginning the next chapter for our combined company." If approved, standalone 2026 guidance will no longer apply after closing, and the combined entity would target 5 to 7% EPS growth on roughly $12 billion of rate base.

Investors watching the quarterly EPS history will note that NorthWestern has largely met or beaten estimates over the past two years, and Q3 2026 is a clear outlier driven by a discrete asset. A $683 million capital plan for 2026 and a $3.2 billion five-year investment program remain intact, as does a quarterly dividend of $0.67 per share, with the record date moved to November 17 to coordinate with the pending merger close.