Earning Preview: Southern Co Q4 revenue is expected to increase by 10.32%, and institutional views are predominantly bullish

Abstract

The Southern Company will report fourth-quarter results on February 19, 2026 Pre-Market; our preview compiles current-quarter revenue and EPS projections alongside last quarter’s performance and forward-looking catalysts to help investors frame expectations ahead of the print.

Market Forecast

Based on the latest quarter-specific projections, The Southern Company is expected to deliver revenue of $6.49 billion, an increase of 10.32% year over year, with adjusted EPS around $0.57, up 13.04%. EBIT for the period is estimated at $1.40 billion, which would imply year-over-year growth of 40.21%; forecasts for gross profit margin and net profit or net margin are not available in the dataset and are therefore omitted. The company’s principal operations are projected to remain driven by the electric operating subsidiaries in Alabama, Georgia, and Mississippi alongside the independent generation and gas businesses, with management emphasis on ongoing load and customer growth to sustain top-line expansion. Within the portfolio, the most promising recent growth was observed at Mississippi Power, which generated $0.48 billion in revenue with 16.50% year-over-year growth in the last reported quarter, while Georgia Power remained the largest single contributor at $3.77 billion with 8.60% growth.

Last Quarter Review

In the previous quarter, The Southern Company posted revenue of $7.82 billion (up 7.55% year over year) and adjusted EPS of $1.60 (up 11.89% year over year); gross profit margin, GAAP net profit attributable to the parent company, and net profit margin were not disclosed in the tool dataset and are therefore not included here. A key highlight from the quarter was the breadth of year-over-year revenue growth across the operating subsidiaries, which coincided with a favorable earnings outcome reflected in the adjusted EPS performance. From a business-mix standpoint, Georgia Power led with $3.77 billion (+8.60% YoY) and Alabama Power posted $2.32 billion (+8.40% YoY), while Mississippi Power grew the fastest at $0.48 billion (+16.50% YoY), Southern Power recorded $0.61 billion (+2.20% YoY), and Southern Company Gas delivered $0.73 billion (+7.60% YoY).

Current Quarter Outlook (with major analytical insights)

Main business trajectory into Q4

Fourth-quarter performance is typically shaped by weather-normalized electricity usage, fuel cost pass-through mechanics, and the cadence of retail and wholesale sales, and current projections suggest a constructive year-over-year comparison for both revenue and earnings. The revenue estimate of $6.49 billion implies a 10.32% year-over-year increase, even though sequential revenue often steps down from summer-peaking quarters, highlighting the potential resilience of the underlying run-rate. On the earnings line, the $0.57 adjusted EPS estimate and the implied 13.04% year-over-year growth rate point to continued margin discipline in operating costs and potential leverage from higher-value retail sales mix. While we do not have an explicit gross margin or net margin forecast to reference, the step-up in estimated EBIT to $1.40 billion (+40.21% YoY) indicates that fixed-cost absorption and controllable expense management are expected to support operating income growth above the pace of revenue. Operationally, momentum observed in the last reported period across the major electric subsidiaries sets a constructive baseline for Q4. The prior quarter’s breadth of growth across Georgia Power, Alabama Power, and Mississippi Power indicates healthy demand dynamics within their territories, which often carry into the year-end period via customer additions and commercial and industrial activity. Within this context, the company’s forward commentary has emphasized demand growth opportunities in its territories; if that cadence persists into Q4, it could underpin both the top line and earnings trajectory, particularly if weather impacts remain within normal ranges. Investors should also watch any updates on fuel cost under-recoveries/over-recoveries and their timing, as these can influence quarter-to-quarter revenue recognition without necessarily impacting underlying profitability. From a financial perspective, the model-implied uplift in EBIT relative to revenue suggests potential for incremental operating leverage in Q4. This would be consistent with a scenario where controllable O&M is contained while revenue benefits from the combination of base rate additions that have annualized and steady kilowatt-hour demand. While we cannot quantify gross margin or net margin without tool-provided figures, the estimated operating income trajectory provides a directional read that supports the projected EPS uplift. Any deviation versus expectations in the quarter will likely reflect weather variance, the timing of cost normalization, and the magnitude of non-fuel O&M spend compared to plan.

Most promising business into the print

Within the operating portfolio, the growth profile highlighted most recently at Mississippi Power and the scale advantages at Georgia Power stand out as the focal areas for incremental upside into the current quarter. Mississippi Power’s last reported quarter revenue of $0.48 billion, up 16.50% year over year, signaled a pronounced acceleration in that footprint; if even a portion of that momentum persists into Q4, the subsidiary could again outgrow peers on a percentage basis. The growth base is smaller than Georgia and Alabama, so outperformance here carries an amplified percentage effect even if its absolute contribution to group revenue is more modest. Georgia Power, at $3.77 billion in last quarter revenue and 8.60% year-over-year growth, remains the largest contributor by far and provides the ballast for consolidated results. Continued steady growth in Georgia’s commercial and industrial activity, combined with customer additions and typical seasonal retail usage patterns, would keep Georgia Power central to the Q4 revenue and earnings mix. Alabama Power at $2.32 billion and 8.40% growth also delivered a stable contribution in the latest quarter and is likely to remain supportive of consolidated trends in Q4. The company’s independent generation arm, Southern Power, and its gas business also added incremental gains last quarter; while Southern Power grew at a slower rate and the gas segment can be more seasonal, both can still contribute to consolidated results when volumes and spreads align with plan. The strategic takeaway for the quarter is that breadth matters: when multiple subsidiaries post mid-to-high single-digit growth, the consolidated profile tends to be more resilient to idiosyncratic swings in any single service territory. Against this backdrop, even if Q4 revenue steps down sequentially from the summer peak, the year-over-year growth implied by consensus suggests that the business mix and rate-base additions continue to do their job. The most visible sign of outperformance would be another quarter in which the fastest-growing subsidiary—recently Mississippi Power—again posts double-digit growth, while Georgia Power and Alabama Power sustain mid-to-high single-digit increases on a much larger base.

Key factors likely to influence the stock around Q4

The primary swing factor for The Southern Company’s stock into and out of the Q4 release will be the degree of alignment between reported results and the $0.57 adjusted EPS estimate, as well as management’s framing of the early-2026 demand and cost outlook. On the revenue line, the $6.49 billion estimate and 10.32% year-over-year growth assumption set a moderately high bar; any material variance versus weather-adjusted retail sales, wholesale volumes, or the timing of cost recovery could move shares. Given the notable 40.21% year-over-year uplift embedded in the EBIT estimate, investors will pay close attention to controllable O&M and non-recurring items; if operating costs track favorably, the upside translation to EPS could be meaningful, while unexpected expense timing or one-offs would work in the other direction. Another key factor is capital program cadence and associated financing. Commentary on project execution, capital spending run-rates, and the pace of in-service additions can shape the forward earnings power and near-term financing mix, which in turn influences earnings sensitivity. Given the company’s multi-subsidiary footprint, updates on individual service territories may also color the near-term narrative; clarity on growth corridors that are seeing faster customer additions and commercial activity can help the market gauge whether the breadth of growth observed in the last reported quarter is holding up into Q4. Finally, any update that sharpens expectations for 2026 earnings growth and capital allocation—such as the timing of cost deferrals or the pacing of rate mechanisms—can influence the medium-term view and, by extension, the stock’s reaction to the Q4 print.

Analyst Opinions

Among recently published sell-side views, the balance of opinions is tilted toward the bullish side, with a majority of institutional commentary supportive of upside in earnings power and payout stability; the minority of negative views are outweighed by positive stances. On the bullish side, Jefferies maintains a Buy view and a price target of $114.00, pointing to constructive earnings visibility grounded in a favorable operating profile and a supportive capital plan that underpins medium-term growth in earnings per share. Argus Research also reiterates a Buy rating with a $101.00 target, highlighting the benefits of steady customer additions and disciplined cost control, which together provide a pathway for earnings that align with or exceed the current-quarter estimate of $0.57 and the 13.04% implied year-over-year growth. Interpreting these bullish opinions in the context of the quarter’s setup, the core of the constructive thesis is that the earnings bridge from revenue to EPS remains intact. With revenue expected to grow by 10.32% year over year and EBIT projected to expand by 40.21%, bullish analysts see multiple avenues for upside surprises: stable retail volumes relative to plan, the carry-through from cost management to operating income, and a balanced mix of contributions across the largest subsidiaries. The most recent quarter’s segment performance—where Georgia Power and Alabama Power delivered high-single-digit growth and Mississippi Power accelerated to double digits—provides analysts with evidence that the growth profile is broad-based, which supports confidence in the Q4 trajectory. Supportive views also emphasize the importance of predictability. When EPS tracking aligns with consensus and when management’s commentary indicates steady progress on execution and customer growth, the stock typically benefits from reduced uncertainty around near-term results. This dynamic is amplified if the company demonstrates that elevated EBIT growth can translate to EPS without being offset by higher non-operating costs. As a result, bullish institutions argue that even if weather introduces some variability in revenue recognition, the quarter’s performance should remain close to the $0.57 EPS marker, with the potential to edge higher if cost containment persists and non-operating items remain benign. These constructive assessments converge on a few testing points into the print: confirmation that last quarter’s breadth of subsidiary growth is persisting into Q4, evidence that controllable O&M is tracking plan, and clarity on the early-2026 run-rate for earnings drivers. Should the release and commentary align with these conditions, bullish analysts expect the company to meet or slightly exceed consensus on revenue and EPS, reinforcing the case that the year-over-year growth embedded in current projections is achievable and sustainable. In short, the prevailing institutional view heading into February 19, 2026 leans positive, anchored by an outlook that sees the earnings bridge intact and the operating cadence supportive of the forecasted 10.32% revenue growth and 13.04% EPS growth in the quarter.