AI Takeaway
EIX reported Q1 FY2026 revenue growth of 7.7% to $4.10B, but net income plunged 63.0% to $531M as operating income was nearly halved, reflecting sharply elevated costs and significant margin compression.
Revenue
$4.1B
++7.66% YoY
EPS (Basic)
$1.38
-63.00% YoY
Operating Income
$1.07B
-49.67% YoY
Filed · Analysis updated · Source: SEC EDGAR 10-Q filing
Revenue increased 7.7% year-over-year to $4.10B in Q1 FY2026 (vs. $3.81B in Q1 FY2025), but this top-line growth was more than offset by a dramatic rise in operating costs, causing operating income to fall 49.7% to $1.07B.
Source: Source: 10-Q Income Statement
Operating margin contracted sharply from approximately 56.0% to 26.2% year-over-year, a decline of nearly 30 percentage points, indicating that cost increases — likely related to wildfire liabilities or infrastructure spending — significantly outpaced revenue growth.
Source: Source: 10-Q Income Statement / Key Ratios
Net income fell 63.0% to $531M from $1.44B, with basic EPS dropping from $3.73 to $1.38, reflecting the impact of elevated below-the-line charges or increased interest expense on the company's $40.3B long-term debt load.
Source: Source: 10-Q Income Statement
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Upgrade to unlockAs a California utility, EIX faces substantial and recurring wildfire-related liabilities that can result in large, unpredictable charges to earnings. The near-50% drop in operating income despite revenue growth strongly suggests elevated wildfire-related costs or legal settlements in Q1 FY2026. These liabilities can materially impair profitability and require significant cash outlays.
Source: Source: 10-Q Income Statement / Balance Sheet
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Upgrade to unlockReported EPS of $1.42 versus the $1.33 analyst consensus — a +7.1% beat for Q1 FY2026.
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue | $4.1B | $3.81B | +7.66% |
Operating Income | $1.07B | $2.13B | -49.67% |
Net Income | $531M | $1.44B | -63.02% |
EPS (Basic) | $1.38 | $3.73 | -63.00% |
EPS (Diluted) | $1.37 | $3.72 | -63.17% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Total Assets | $94.47B | $88.42B | +6.85% |
Current Assets | $7.18B | $7.43B | -3.38% |
Total Liabilities | $75.59B | $69.62B | +8.57% |
Current Liabilities | $9.7B | $7.77B | +24.86% |
Stockholders' Equity | $17.32B | $16.62B | +4.20% |
Cash & Equivalents | $168M | $1.32B | -87.25% |
Long-Term Debt | $40.31B | $38.39B | +5.00% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Cash Flow | $1.43B | $1.22B | +16.58% |
Investing Cash Flow | $-1.59B | $-1.37B | -15.57% |
Financing Cash Flow | $212M | $1.37B | -84.57% |
Share Buybacks | $26M | $29M | -10.34% |
D&A | $834M | $742M | +12.40% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Margin | 26.2% | 56.0% | -29.82% |
Net Margin | 12.9% | — | — |
ROE | 3.1% | — | — |
ROA | 0.6% | — | — |
Current Ratio | $0.74 | — | — |
Debt to Equity | $4.364 | — | — |
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EIX reported a sharp earnings decline in Q1 FY2026, with net income falling 63.0% to $531M from $1.44B a year ago, and basic EPS dropping from $3.73 to $1.38. Despite revenue growing 7.7% to $4.10B, operating income was nearly halved to $1.07B, suggesting significant cost increases — likely wildfire-related charges or infrastructure expenses — weighed heavily on profitability.
EIX's operating margin collapsed from approximately 56.0% to 26.2% in Q1 FY2026, a decline of nearly 30 percentage points. This dramatic compression indicates that operating costs rose far faster than the 7.7% revenue growth, which for a California utility like EIX is often associated with wildfire liability charges, legal settlements, or accelerated infrastructure spending.
EIX's cash and equivalents fell 87.3% to just $168M in Q1 FY2026, and its current ratio dropped to 0.74, meaning current liabilities of $9.70B exceed current assets of $7.18B. While this raises near-term liquidity concerns, EIX generated $1.43B in operating cash flow during the quarter, and as a regulated utility it typically has access to capital markets; however, the low cash position and high leverage (debt-to-equity of 4.36x) warrant close monitoring.
EIX grew revenue 7.7% year-over-year to $4.10B in Q1 FY2026, up from $3.81B in the prior-year period. However, this top-line growth was overshadowed by a near-50% decline in operating income, indicating that cost pressures significantly outpaced the revenue improvement.
The most significant risks highlighted by EIX's Q1 FY2026 financial data include wildfire-related liabilities (which appear to have driven the sharp earnings decline), near-term liquidity pressure from a current ratio of only 0.74 and cash of just $168M, and high financial leverage with $40.3B in long-term debt against $17.3B in equity. Regulatory risk around rate recovery in California also remains a key concern for the company's ability to recoup elevated costs.