Essential Utilities Reports Q2 2026 Results
BRYN MAWR, Pa.--( BUSINESS WIRE)--Essential Utilities Inc. (NYSE: WTRG) today reported results for the second quarter ended June 30, 2026.
Company Highlights
“Our commitment to operational efficiency, proactive cost optimization, and value driven customer experience investments underpins our confidence in driving strong performance for 2026. While our organization transitions towards the targeted Q1 2027 merger with American Water, we remain steadfast in our commitment to driving peak operational performance,” said Essential Utilities Chairman and Chief Executive Officer Christopher Franklin. “We are confident that the combination with American Water will bring exciting new opportunities, and we believe that, together, we will deliver significant benefits to our combined customers and shareholders. Crucially, both companies share a dedicated focus on smart capital deployment targeting measurable reliability and quality service. This will allow us to uphold our strong safety and reliability metrics while continuing to deliver affordable, cost-effective utility solutions,” Franklin added.
“The regulatory approval processes for our merger with American Water continue to progress. On June 22nd, we received approval of the merger from the Virginia State Corporation Commission, and on May 14 th we received approval from the Public Utilities Commission of Ohio. Previously, we received regulatory approval for the merger from the Kentucky Public Service Commission.
As a reminder, we filed in all pertinent states before the end of 2025. In February, at the special shareholder meeting to approve the merger, approximately 95% of the voted shares were cast in favor of the transaction. This overwhelming mandate supports what we have believed from the start: that this combination creates a premier, multi-state utility with a high growth profile,” Franklin added.
Second Quarter 2026 Operating Results
Essential reported GAAP net income of $105.7 million and earnings per share of $0.37 for the second quarter of 2026, compared to GAAP net income of $107.8 million and earnings per share of $0.38 for the same period in 2025.
The second quarter Q2 2026 non-GAAP EPS of $0.38, reflects business results without the impact of merger-related expenses incurred in the quarter.
Revenues for the quarter were $530.9 million compared to $514.9 million in the second quarter of 2025, an increase of 3%. Additional revenues from regulatory recoveries and purchased gas costs were the main revenue drivers. Operations and maintenance expenses were $153.6 million for the second quarter of 2026, compared to $148.5 million in the second quarter of 2025, an increase of 3.5%, primarily due to increases in employee-related costs of $5.9 million, including annual merit increases and higher medical claims, and an increase in production costs for water and wastewater operations of $2.3 million, offset by a decrease in insurance expenses of $4.9 million primarily due to insurance recoveries, a decrease in bad debt expense of $2.9 million, a decrease in customer assistance surcharge costs of $1.5 million, which generally has an offsetting amount in revenues, and merger-related expenses of $1.2 million. Excluding merger related costs, O&M expenses increased by 2.6%.
Essential’s regulated water segment reported revenues for the quarter of $357.5 million, an increase of 7.6% compared to $332.3 million in the second quarter of 2026. Regulatory recoveries and increased volume were the largest contributors to the increase in revenues for the period. Operations and maintenance expenses for Essential’s regulated water segment increased to $109.4 million for the second quarter of 2026 compared to $100.1 million in the second quarter of 2025, driven by increased employee-related costs, increases in production costs for water and wastewater operations particularly purchased water and chemical costs, and additional operating costs associated with acquisitions of water and wastewater systems. Excluding the one-time items and the impact of abnormal weather, operations and maintenance expenses for the full year are expected to be in line with historic norms.
Essential’s regulated natural gas segment reported revenues for the quarter of $169.3 million, compared to $177.3 million in the second quarter of 2025, driven primarily by higher rates and surcharges, a decrease in purchased gas costs, and lower volumes due to warm weather conditions during the second quarter of 2026 as compared to 2025. Operations and maintenance expenses for Essential’s regulated natural gas segment were essentially flat at $49.9 million for the second quarter of 2026 compared to $49.8 million in the second quarter of 2025.
For the first six months of 2026, the Company reported revenues of $1,392.6 million, a 7.2% increase, primarily due to regulatory recoveries, increased purchased gas costs, and higher volumes in the regulated natural gas segment, compared to $1,298.5 million in the first half of 2025. Operations and maintenance expenses for the first half of 2026 totaled $329.4 million, compared to $286.3 million in 2025, including $17.5 million of merger related expenses in 2026. Net Income for the first half of 2026 totaled $330.1 million, or $1.16 per share, compared to $391.6 million, or $1.41 per share for the same period of 2025.
Dividend
As previously announced on July 29, 2026, Essential’s board of directors increased the quarterly cash dividend, 5.25% to $0.3606 per share of common stock. This dividend will be payable on September 1, 2026, to shareholders of record on August 11, 2026.
Essential Utilities has paid consecutive quarterly cash dividends for over 80 years and has increased the dividend 36 times in the last 35 years.
Financing
As of June 30, 2026, Essential’s weighted average cost of fixed-rate long-term debt was 4.16%, and the company had $960 million available on its credit lines.
Rate Activity
Thus far in 2026, the Company’s regulated water segment received rate awards or infrastructure surcharges that will increase annual revenues in Pennsylvania, Illinois, Ohio, North Carolina and Indiana by $43.9 million, and its regulated natural gas segment received rate awards or infrastructure surcharges in Kentucky and Pennsylvania of $12.7 million.
The Company currently has base rate cases or infrastructure surcharges pending in Texas, Virginia, Illinois, Indiana and New Jersey for its regulated water and wastewater segment for an estimated $79.7 million in incremental annual revenues. The company currently has a base rate case pending in Pennsylvania for its natural gas segment with a requested revenue increase of $163.2 million to support its Long-Term Infrastructure Improvement Plan, which involves the replacement and retirement of aging gas mains and the associated reduction of greenhouse gas emissions.
Capital Expenditures
Essential invested approximately $662.2 million in the first six months of 2026 to improve its regulated water and natural gas infrastructure systems and to enhance customer service across its operations. The Company continues to be a leader in the United States at replacing miles of aged underground utility pipes and is committed to maintaining elevated levels of infrastructure investment. Essential is on track to invest $1.7 billion in needed infrastructure investments in 2026.
Water Utility Growth by Acquisition
Essential’s continued growth by acquisition allows the company to provide safe and reliable water and wastewater service to a larger customer base than it could from organic customer growth alone.
Since 2015, Essential has acquired approximately $570 million in rate base and added more than 138,000 new customers or equivalent dwelling units to the company’s footprint.
In May 2026, the Company acquired Integra Water Texas, LLC's wastewater system in Bastrop County, Texas, for approximately $4.9 million. The Company has signed purchase agreements for additional water and wastewater systems in Pennsylvania, Texas, North Carolina and New Jersey that are pending closing and are expected to serve over 200,000 customers or equivalent dwelling units and total approximately $282 million in purchase price. The Company’s $276.5 million agreement to acquire the Delaware County Regional Water Quality Control Authority (DELCORA), a Pennsylvania sewer authority that serves approximately 198,000 equivalent dwelling units in the Philadelphia suburbs, is included among these signed purchase agreements.
The pipeline of potential water and wastewater municipal acquisitions the Company is actively pursuing represents approximately 400,000 total customers.
Merger with American Water Works Company, Inc.
The Company is continuing to progress through the process of obtaining the consents and approvals needed to successfully consummate the proposed merger with American Water. On February 10, 2026, shareholders of both companies voted overwhelmingly in favor of merger-related proposals. In 2025, Essential submitted applications for required regulatory approval in all states where applicable. On June 22, 2026, we received an order from the Virginia State Corporation Commission approving the merger. Previously we had obtained regulatory approval for the merger from public utility commissions in Kentucky and Ohio.
We continue to expect the merger to close in the first quarter of 2027.
Financial and Growth Guidance
The Company’s latest expectations are the following:
Guidance Assumptions
Essential Utilities does not guarantee future results of any kind. Guidance is subject to risks and uncertainties, including, without limitation, those factors outlined in the “Forward Looking Statements” of this release and the “Risk Factors” section of the company’s annual and quarterly reports filed with the Securities and Exchange Commission. The earnings per share and infrastructure investment include the municipal water and wastewater acquisitions for which the company has entered into signed purchase agreements as of the date the guidance was announced, but do not include DELCORA or other potential acquisitions from the company’s list of acquisition opportunities that currently represents over 400,000 customer equivalents. While the company remains confident in its ability to close DELCORA, for guidance purposes, DELCORA has been removed from all guidance metrics. The company’s guidance includes the expectation that the company will continue to issue equity and debt on an as-needed basis to support acquisitions and capital investment plans.
Essential Utilities believes that the non-GAAP financial measure “adjusted earnings per share” used for 2024 and identified as part of its multi-year financial and growth guidance supplements investors the ability to measure the company’s financial operating performance for 2024, including by adjustment, as compared to the Company’s operating performance in 2024.
2Q 2026 Earnings Call Information
Date: August 5 th, 2026
Time: 11 a.m. EDT (please dial in by 10:45 a.m.)
Webcast and slide presentation link: https://www.essential.co/events-and-presentations/events-calendar
The call and presentation will be webcast live so interested parties may listen over the internet by logging on to Essential.co and following the link for Investors. The conference call will be archived in the Investor Relations section of the company’s website following the call.
About Essential
Essential Utilities, Inc. (NYSE: WTRG) delivers safe, clean, reliable services that improve quality of life for individuals, families, and entire communities. With a focus on water, wastewater, and natural gas, Essential is committed to sustainable growth, operational excellence, a superior customer experience, and premier employer status. We are advocates for the communities we serve and are dedicated stewards of natural lands, protecting thousands of acres of forests and other habitats throughout our footprint.
Operating as the Aqua and Peoples brands, Essential serves approximately 5.5 million people across nine states. Essential is one of the most significant publicly traded water, wastewater service and natural gas providers in the U.S. Learn more at www.essential.co.
Forward-Looking Statements
This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which generally include words such as “believes,” “expects,” “intends,” “anticipates,” “estimates,” and similar expressions. The Company can give no assurance that any actual or future results or events discussed in these statements will be achieved. Any forward-looking statements represent its views only as of today and should not be relied upon as representing its views as of any subsequent date. Readers are cautioned that such forward-looking statements are subject to a variety of risks and uncertainties that could cause the company’s actual results to differ materially from the statements contained in this release. Such forward-looking statements include, among others: the anticipated receipt of regulatory approvals for, and closing of, the company’s proposed merger with American Water; the guidance range of net income per diluted common share; the anticipated amount of infrastructure investment in 2026; and the Company’s anticipated use of equity and debt financing. There are important factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements including: the expected timing and likelihood of completion of our proposed merger with American Water; changes in the EPAs regulations; changes in the United States’ governmental policies, including those from the Executive Branch; disruptions in the global economy; potential disruptions in the supply chain for raw and finished materials; the continuation of the company's growth-through-acquisition program; general economic business conditions; the company’s ability to successfully execute any equity or debt financing transactions, including on an as needed basis; housing and customer growth trends; unfavorable weather conditions; the success of certain cost-containment initiatives; changes in regulations or regulatory treatment; the company’s ability to successfully close municipally owned systems presently under agreement and successfully complete other acquisitions and dispositions; and other factors discussed in our Annual Report on Form 10-K and our Quarterly Reports on Form 10-Q, which are filed with the Securities and Exchange Commission. For more information regarding risks and uncertainties associated with Essential's business, please refer to Essential's annual, quarterly, and other SEC filings. Essential is not under any obligation - and expressly disclaims any such obligation - to update or alter its forward-looking statements whether as a result of new information, future events, or otherwise.
2026
2025
2026
2025
$
530,854
$
514,907
$
1,392,613
$
1,298,533
$
153,635
$
148,510
$
329,430
$
286,334
$
105,725
$
107,827
$
330,117
$
391,616
$
0.37
$
0.38
$
1.16
$
1.41
$
0.37
$
0.38
$
1.16
$
1.41
283,655
280,275
283,419
277,748
284,088
280,725
283,998
278,335
2026
2025
2026
2025
$
530,854
$
514,907
$
1,392,613
$
1,298,533
153,635
148,510
329,430
286,334
46,201
56,735
284,816
241,376
109,578
99,542
216,687
196,306
3,714
3,977
7,334
6,590
24,453
20,872
50,433
43,751
337,581
329,636
888,700
774,357
193,273
185,271
503,913
524,176
89,111
79,809
176,418
161,874
(510
)
(301
)
(2,121
)
(530
)
(5,739
)
(7,027
)
(11,499
)
(12,859
)
1,295
391
1,220
98
109,116
112,399
339,895
375,593
3,391
4,572
9,778
(16,023
)
$
105,725
$
107,827
$
330,117
$
391,616
$
0.37
$
0.38
$
1.16
$
1.41
$
0.37
$
0.38
$
1.16
$
1.41
283,655
280,275
283,419
277,748
284,088
280,725
283,998
278,335
2026
2025
14,746,257
14,263,682
465,309
610,396
4,730,421
4,590,767
19,941,987
19,464,845
7,018,256
6,857,456
8,421,198
8,110,167
83,312
171,961
515,677
592,522
3,903,544
3,732,739
19,941,987
19,464,845
Essential Utilities, Inc. and Subsidiaries
Reconciliation of GAAP to Non-GAAP Financial Measures
(In Thousands, except per share amounts)
$
595,314
(94,024
)
$
18,749
$
20,859
$
540,898
$
2.17
$
2.17
$
1.97
$
1.97
273,914
274,421
The Company is providing disclosure of the reconciliation of adjusted earnings per share, a non-GAAP financial measures referenced in this release, to the most comparable GAAP financial measure. Adjusted earnings per share does not comply with U.S. generally accepted accounting principles (GAAP), and is thus considered to be a “non-GAAP financial measures” under applicable SEC regulations.
Adjusted earnings per share is one of the primary metrics used by management to evaluate the Company’s financial performance and compare it to that of its peers, evaluate the effectiveness of the Company’s business strategies, and in connection with executive compensation decisions. This measure is also frequently used by analysts, investors, and others to evaluate industry peers. Further, the Company believes adjusted earnings per share is helpful in highlighting trends in the Company’s results because it allows for more consistent comparisons of performance between periods by excluding gains and losses that are non-operational in nature or outside the control of management. The Company further believes that this non-GAAP financial measure is useful to investors as a more meaningful way to compare the Company’s operating performance against its guidance. This non-GAAP measure does, however, have certain limitations and should not be considered as an alternative to earnings per share or any other performance.
Adjusted earnings per share adjusts for the following items:
$
105,725
1,191
(321
)
$
106,595
$
0.37
$
0.37
$
0.38
$
0.38
283,655
284,088
The Company is providing disclosure of the reconciliation of adjusted earnings per share, a non-GAAP financial measures referenced in this release, to the most comparable GAAP financial measure. Adjusted earnings per share does not comply with U.S. generally accepted accounting principles (GAAP), and is thus considered to be a “non-GAAP financial measures” under applicable SEC regulations.
$
330,117
17,521
(4,716
)
$
342,922
$
1.16
$
1.16
$
1.21
$
1.21
283,419
283,998