It is a simple but powerful business model built on more than two decades of consistent performance, deliberate execution, disciplined capital allocation, and industry-leading results. With our long capital runway, top-tier regulatory environment, and our commitment to affordable customer bills through the CE Way plus digital and other cost savings, CMS Energy continues to deliver. This proven model drives a premium total shareholder return made up of 6%-8% adjusted EPS growth compounded annually and paired with an approximately 3% dividend yield. For you, our investors, it means predictable earnings growth, a competitive dividend, and long-term shareholder value.
First, we plan to reallocate capital away from NorthStar and exit non-utility renewables development. Second, the retained assets will not require significant capital investment, and they generate strong cash flow, further optimizing parent financing and supporting our large utility capital investment plan. Beyond 2027, we expect NorthStar's earnings to be driven primarily by DIG and the peakers. We are targeting the restructuring to be complete by the end of this year and anticipate providing an interim update on future earnings calls as we execute the repositioning of this business.
We have one of the most constructive frameworks in the country for data center growth. Our large load tariff ensures new large load customers bear all costs to serve them, supports economic growth, and protects existing customers. In addition to the large load growth we are seeing, year to date, we have also contracted roughly 135 MW of manufacturing and industrial load. This consistent momentum is a reflection of Michigan's economic growth and why Michigan, for the fourth year in a row, was ranked number six in CNBC's top states for business.
| Metric | Period | Current guidance |
|---|---|---|
| Adjusted EPS | FY2026 | $3.83-$3.90 (reaffirmed, confidence toward the high end) |
| Adjusted EPS | FY2027 | $4.08-$4.17 (newly introduced; within 6%-8% off 2025 actuals, no rebase) |
| Long-term adjusted EPS growth | Long-term | 6%-8%, toward the high end, plus ~3% dividend yield |
| Rate base growth / utility capex | Five-year plan | 10.5% compounded rate base growth on a $24 billion utility investment plan (plus $2B renewables and $1B reliability upside) |
| Equity issuance | Five-year plan | Reduce by at least $350 million as NorthStar cash is redeployed ($700M planned in 2026, ~$500M completed) |
| NorthStar restructuring | By end 2026 | Exit non-utility renewables development, retain DIG/peakers/solar; targeted complete by year-end |
| Metric | YoY | Note |
|---|---|---|
| Operating revenue | $1,829M (~-0.5%) | Roughly flat versus $1,838M a year ago; first-half revenue up 6.4% to $4,559 million. |
| Operating income | $264M (14.4% margin) | Down from $317 million, largely on storm-driven O&M and unfavorable weather comparisons. |
| GAAP diluted EPS | $0.37 (vs $0.66) | Net income available to common of $117 million; lapping prior-year liability-management benefits and storm impacts. |
| Adjusted diluted EPS | $0.37 (vs $0.71) | First-half adjusted EPS $1.50 versus $1.73, a $0.23 unfavorable variance from planned 2025 liability-management benefits and storms. |
| New rates net of investment | +$0.20 YTD | Benefits of last year's gas rate order, new electric rates effective in May, and continued renewable investment at the utility. |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| NorthStar restructuring / simplification | Non-utility renewables development platform | Exiting non-utility renewables development to focus on the utility; retaining DIG, peakers, and four Michigan solar projects for cash flow; nearly 100% of earnings become rate-base-driven after 2027, improving earnings quality and parent financing (>$500 million funding offset through 2030). | — |
| Data center large-load growth | Early discussions | Signed a large-load tariff (extraordinary facilities plus rate agreement) with one of the most constructive frameworks in the country, delivering ~$7.50/month residential bill benefit per gigawatt; multiple customers/locations in play, with load growth to be incorporated into the September IRP after local zoning. | — |
| Regulatory calendar | Ongoing rate activity | Filed a $456 million electric rate case (10.25% ROE, 51.75% equity ratio) with a two-year investment recovery mechanism, revised the gas case to $232 million at a 51.75% equity ratio, and moved the IRP to September to reflect the data center agreement. | — |
| Utility investment and rate base growth | — | $24 billion plan driving 10.5% rate base growth, with $2 billion renewables (approved REP) and $1 billion distribution-reliability upside available in the back half; NorthStar repositioning improves balance-sheet flexibility to fund incremental capex without necessarily raising equity. | — |
| Non-rate-base earnings | Differentiator | Energy efficiency incentives (a mature program) and the Financial Compensation Mechanism on power purchase agreements provide upside as CMS procures renewable, clean-energy, and battery-storage resources under Michigan's energy law. | — |
| Reliability and storm hardening | Fourth-quartile performer | Now solidly third quartile approaching second, with 92% of customers restored within 24 hours in the first half; a storm-deferral docket is pending (constructive precedent from last year), and a new five-year tree-trimming cycle is beginning. | — |
| CFO transition | — | Sri Maddipati (12-year CMS veteran with operations and power-supply experience) held his first earnings call as CFO, succeeding Rejji Hayes ('Reggie'), and reiterated confidence in the plan. | — |