Fortis (NYSE:FTS) reported first-quarter earnings on Wednesday that exceeded analyst expectations, supported by continued rate base growth and progress on its long-term infrastructure investment strategy.
The regulated North American utility company posted earnings of $0.99 per share for the quarter, comfortably ahead of Wall Street forecasts of $0.67 per share.
Net earnings totaled $501 million for the period ended March 31, 2026, broadly unchanged from the same quarter last year.
Rate base growth supports quarterly performance
Fortis said earnings growth during the quarter was driven by expanding rate bases across its utility operations and favorable timing of earnings contributions at Central Hudson.
These gains were partly offset by lower earnings at UNS Energy, where wholesale electricity market conditions and planned maintenance expenses weighed on results.
“First quarter results were in line with our expectations, and reflect the strength of our diversified business and the continued execution of our low-risk capital plan,” said David Hutchens, president and chief executive officer of Fortis.
Data center infrastructure projects continue to expand
Fortis invested approximately $1.4 billion in capital expenditures during the quarter, keeping the company on pace to meet its full-year capital spending plan of $5.6 billion.
In March, the company completed a substation project designed to support 300 megawatts of load growth tied to the first data center at the Big Cedar Industrial Center.
Additional transmission infrastructure upgrades are currently underway at the site to support another 1,600 megawatts of future data center demand, with completion expected by 2028.
Arizona rate approval provides additional support
Fortis also highlighted a February decision by the Arizona Corporation Commission approving the UNS Gas general rate application.
The ruling included authorization for a 9.61% return on common equity and a capital structure consisting of 56% common equity.
The regulator also approved an annual formula-based rate adjustment mechanism, with updated rates taking effect on March 1, 2026.
Long-term growth and dividend targets maintained
Fortis reaffirmed its five-year capital investment plan totaling $28.8 billion.
The company expects the plan to increase its midyear rate base from $42.4 billion in 2025 to $57.9 billion by 2030, representing a compound annual growth rate of 7%.
Fortis also maintained its expectation for annual dividend growth of between 4% and 6% through 2030.