Fuel, purchased supply and direct transmission expense (exclusive of depreciation and depletion shown separately below)
145,565
138,197
Operating and maintenance
74,540
56,709
Administrative and general
46,119
41,357
Property and other taxes
50,404
43,240
Depreciation and depletion
66,831
62,400
Total Operating Expenses
383,459
341,903
Operating income
114,111
124,727
Interest expense, net
(39,916)
(36,511)
Other income, net
3,057
3,928
Income before income taxes
77,252
92,144
Income tax expense
(13,796)
(15,204)
Net Income
$
63,456
$
76,940
Average Common Shares Outstanding
61,461
61,339
Basic Earnings per Average Common Share
$
1.03
$
1.25
Diluted Earnings per Average Common Share
$
1.03
$
1.25
Dividends Declared per Common Share
$
0.67
$
0.66
See Notes to Condensed Consolidated Financial Statements
NORTHWESTERN ENERGY GROUP
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)
(in thousands)
Three Months Ended March 31,
2026
2025
Net Income
$
63,456
$
76,940
Other comprehensive income, net of tax:
Foreign currency translation adjustment
(1)
1
Reclassification of net losses on derivative instruments
113
113
Total Other Comprehensive Income
112
114
Comprehensive Income
$
63,568
$
77,054
See Notes to Condensed Consolidated Financial Statements
NORTHWESTERN ENERGY GROUP
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(in thousands, except share data)
ASSETS
March 31, 2026
December 31, 2025
Current Assets:
Cash and cash equivalents
$
5,861
$
8,781
Restricted cash
21,744
21,957
Accounts receivable, net
199,275
209,751
Inventories
134,071
132,506
Regulatory assets
103,237
92,937
Prepaid expenses and other
48,984
38,010
Total current assets
513,172
503,942
Property, plant, and equipment, net
6,794,000
6,738,849
Goodwill
367,635
367,635
Regulatory assets
773,589
772,634
Other noncurrent assets
134,110
76,631
Total Assets
$
8,582,506
$
8,459,691
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Current maturities of finance leases
$
1,844
$
1,865
Current portion of long-term debt
104,983
104,967
Short-term borrowings
150,000
150,000
Accounts payable
121,796
129,633
Accrued expenses and other
321,104
272,373
Regulatory liabilities
31,195
38,613
Total current liabilities
730,922
697,451
Long-term finance leases
8,436
—
Long-term debt
3,177,528
3,181,040
Deferred income taxes
750,719
733,064
Noncurrent regulatory liabilities
684,664
678,861
Other noncurrent liabilities
321,353
283,535
Total Liabilities
5,673,622
5,573,951
Commitments and Contingencies (Note 11)
Shareholders' Equity:
Common stock, par value $0.01; authorized 200,000,000 shares; issued and outstanding 65,001,449 and 61,503,442 shares, respectively; Preferred stock, par value $0.01; authorized 50,000,000 shares; none issued
650
649
Treasury stock at cost
(99,186)
(97,503)
Paid-in capital
2,094,232
2,091,935
Retained earnings
919,137
896,720
Accumulated other comprehensive loss
(5,949)
(6,061)
Total Shareholders' Equity
2,908,884
2,885,740
Total Liabilities and Shareholders' Equity
$
8,582,506
$
8,459,691
See Notes to Condensed Consolidated Financial Statements
NORTHWESTERN ENERGY GROUP
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
Three Months Ended March 31,
OPERATING ACTIVITIES:
2026
2025
Net income
$
63,456
$
76,940
Adjustments to reconcile net income to cash provided by operations:
Depreciation and depletion
66,831
62,400
Amortization of debt issuance costs, premium, and deferred hedge gain
975
990
Stock-based compensation costs
2,045
2,284
Equity portion of allowance for funds used during construction
(1,941)
(1,797)
Loss on disposition of assets
9
149
Deferred income taxes
14,140
13,071
Changes in current assets and liabilities:
Accounts receivable
10,476
275
Inventories
(1,565)
3,335
Other current assets
(10,974)
5,510
Accounts payable
(7,984)
(14,992)
Accrued expenses and other
48,746
24,792
Regulatory assets
(10,300)
(12,711)
Regulatory liabilities
(7,418)
(6,335)
Other noncurrent assets and liabilities
(7,082)
(519)
Cash Provided by Operating Activities
159,414
153,392
INVESTING ACTIVITIES:
Property, plant, and equipment additions
(116,080)
(92,124)
Investment in debt & equity securities
—
(4,584)
Cash Used in Investing Activities
(116,080)
(96,708)
FINANCING ACTIVITIES:
Dividends on common stock
(41,038)
(40,307)
Issuance of long-term debt
—
400,000
Line of credit repayments, net
(4,000)
(362,000)
Other financing activities, net
(1,429)
(3,328)
Cash Used in Financing Activities
(46,467)
(5,635)
(Decrease) Increase in Cash, Cash Equivalents, and Restricted Cash
(3,133)
51,049
Cash, Cash Equivalents, and Restricted Cash, beginning of period
30,738
29,017
Cash, Cash Equivalents, and Restricted Cash, end of period
$
27,605
$
80,066
Supplemental Cash Flow Information:
Cash (received) paid during the period for:
Production tax credits(1)
—
(8,255)
Interest
44,166
32,768
Significant non-cash transactions:
Capital expenditures included in accounts payable
41,848
14,028
(1) Proceeds from production tax credits transferred are included in cash provided by operating activities within the Condensed Consolidated Statement of Cash Flows.
See Notes to Condensed Consolidated Financial Statements
NORTHWESTERN ENERGY GROUP
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
(Unaudited)
(in thousands, except per share data)
Three Months Ended March 31,
Number of
Number of
Common
Treasury
Retained
Accumulated Other
Total
Common
Treasury
Paid in Capital
Comprehensive
Shareholders'
Shares
Shares
Stock
Stock
Earnings
Loss
Equity
Balance at December 31, 2024
64,811
3,490
$
648
$
(97,394)
$
2,084,133
$
877,017
$
(6,704)
$
2,857,700
Net income
—
—
—
—
—
76,940
—
76,940
Foreign currency translation
—
—
—
—
—
—
1
1
adjustment, net of tax
Reclassification of net losses on
derivative instruments from OCI to net
—
—
—
—
—
—
113
113
income, net of tax
Stock-based compensation
59
—
1
(729)
2,272
—
—
1,544
Issuance of shares
—
7
—
188
189
—
—
377
Dividends on common stock ($0.660
—
—
—
—
—
(40,307)
—
(40,307)
per share)
Balance at March 31, 2025
64,870
3,497
$
649
$
(97,935)
$
2,086,594
$
913,650
$
(6,590)
$
2,896,368
Balance at December 31, 2025
64,895
3,477
$
649
$
(97,503)
$
2,091,935
$
896,720
$
(6,061)
$
2,885,740
Net income
—
—
—
—
—
63,456
—
63,456
Foreign currency translation
—
—
—
—
—
—
(1)
(1)
adjustment, net of tax
Reclassification of net losses on
derivative instruments from OCI to net
—
—
—
—
—
—
113
113
income, net of tax
Stock-based compensation
106
28
1
(1,874)
2,036
—
—
163
Issuance of shares
—
(7)
—
191
261
—
—
452
Dividends on common stock ($0.670
—
—
—
—
—
(41,039)
—
(41,039)
per share)
Balance at March 31, 2026
65,001
3,498
650
(99,186)
2,094,232
919,137
(5,949)
2,908,884
See Notes to Condensed Consolidated Financial Statements
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Reference is made to Notes to Financial Statements included in the NorthWestern Energy Group's Annual Report)
(Unaudited)
(1) Nature of Operations and Basis of Consolidation
NorthWestern Energy Group, doing business as NorthWestern Energy, provides electricity and/or natural gas to approximately 850,300 customers in Montana, South Dakota, Nebraska and Yellowstone National Park, through its subsidiaries NorthWestern Corporation (NW Corp) and NorthWestern Energy Public Service Corporation (NWE Public Service). We have generated and distributed electricity in South Dakota and distributed natural gas in South Dakota and Nebraska since 1923 and have generated and distributed electricity and distributed natural gas in Montana since 2002.
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (GAAP) requires us to make estimates and assumptions that may affect the reported amounts of assets, liabilities, revenues and expenses during the reporting period. Actual results could differ from those estimates. The unaudited Condensed Consolidated Financial Statements (Financial Statements) reflect all adjustments (which unless otherwise noted are normal and recurring in nature) that are, in our opinion, necessary to fairly present our financial position, results of operations and cash flows. The actual results for the interim periods are not necessarily indicative of the operating results to be expected for a full year or for other interim periods. Events occurring subsequent to March 31, 2026 have been evaluated as to their potential impact to the Financial Statements through the date of issuance.
The Financial Statements included herein have been prepared by NorthWestern, without audit, pursuant to the rules and regulations of the SEC. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations; however, we believe that the condensed disclosures provided are adequate to make the information presented not misleading. We recommend that these Financial Statements be read in conjunction with the audited financial statements and related footnotes included in the NorthWestern Energy Group Annual Report on Form 10-K for the year ended December 31, 2025.
Supplemental Cash Flow Information
The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the Condensed Consolidated Balance Sheets that sum to the total of the same such amounts shown in the Condensed Consolidated Statements of Cash Flows (in thousands):
March 31,
December 31,
March 31,
December 31,
2026
2025
2025
2024
Cash and cash equivalents
$
5,861
$
8,781
$
56,025
$
4,283
Restricted cash
21,744
21,957
24,041
24,734
Total cash, cash equivalents, and restricted cash shown in
$
27,605
$
30,738
$
80,066
$
29,017
the Condensed Consolidated Statements of Cash Flows
(2) Pending Merger with Black Hills Corporation
On August 18, 2025, we entered into a Merger Agreement with Black Hills and River Merger Sub, Inc., a Delaware corporation and direct wholly owned subsidiary of Black Hills (Merger Sub). The Merger Agreement provides for an all-stock merger of equals between NorthWestern and Black Hills upon the terms and subject to the conditions set forth therein. The Merger Agreement provides for Merger Sub to merge with and into NorthWestern, with NorthWestern continuing as the surviving entity and a direct wholly owned subsidiary of Black Hills, which would assume the new corporate name of Bright Horizon Energy as the resulting parent company of the combined corporate group. Under the provisions of ASC Topic 805, which requires the identification of an acquirer in a business combination, Black Hills is the accounting acquirer. Pursuant to the Merger Agreement, at the effective time of the Merger, each share of NorthWestern, par value $0.01 per share, issued and outstanding as of immediately prior to closing will be converted into the right to receive 0.98 validly issued, fully paid and non-assessable shares of Black Hills Common Stock.
In connection with this pending merger, we have incurred merger-related costs. During the three months ended March 31, 2026, we have incurred $3.4 million of merger-related costs, which are included in our Administrative and general expenses.
Regulatory and Shareholder Approvals
Our pending merger with Black Hills was unanimously approved by our board of directors and Black Hills' board of directors. In February 2026, the Form S-4, which contains joint proxy statement/prospectus for NorthWestern and Black Hills, was declared effective by the SEC. In April 2026, shareholders of each company voted to approve the Merger and the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act expired, permitting consummation of the transaction. The completion of the Merger remains subject to the satisfaction or waiver of certain conditions to
closing, including (1) subject to certain conditions, the receipt of certain regulatory approvals, including approval from the Federal Energy Regulatory Commission (FERC), the Montana Public Service Commission (MPSC), the Nebraska Public Service Commission (NPSC), and the South Dakota Public Utilities Commission (SDPUC), in each case on such terms and conditions that would not result in a material adverse effect on Bright Horizon Energy; (2) the absence of any court order or regulatory injunction prohibiting the completion of the Merger; (3) the authorization for listing of shares of Black Hills Common Stock to be issued in the Merger on a mutually agreed stock exchange; (4) subject to specified materiality standards, the accuracy of the representations and warranties of each party; (5) compliance by each party in all material respects with its covenants; (6) the absence of a material adverse effect on each party; and (7) receipt of each party of an opinion relating to the anticipated tax-free treatment of the Merger.
We have filed applications with the MPSC, NPSC, SDPUC, and FERC for approval of the Merger. In March 2026, we reached a settlement agreement with the Public Advocate of Nebraska, which is subject to approval by the NPSC. A hearing with the NPSC was held in April 2026. In April 2026, we reached settlement agreements with certain key intervenors in both Montana and South Dakota, which are subject to approval by the MPSC and SDPUC, respectively. Hearings with the MPSC and SDPUC are scheduled in the second quarter of 2026. We anticipate the transaction closing in the second half of 2026, subject to the satisfaction or waiver of certain closing conditions.
(3) Regulatory Matters
Montana Rate Review
In December 2025, the MPSC issued a final order approving our partial electric settlement agreement. The final order also suspended the 90/10 cost sharing mechanism of the Power Cost and Credit Adjustment Mechanism (PCCAM) on a temporary basis pending further review by the MPSC. Within this final order, the MPSC disallowed a portion of the capital costs related to the construction of Yellowstone County Generating Station (YCGS). As a result, in the fourth quarter of 2025 we recorded a $30.9 million non-cash charge for the regulatory disallowance. As of March 31, 2026, we have $6.3 million reserved within Regulatory liabilities on the Condensed Consolidated Balance Sheets for interim rates to be refunded to customers.
In January 2026, we filed a Motion for Reconsideration (Motion) as it relates to this final order. Among other things, our Motion requests that the MPSC reconsider their prudence conclusions regarding the capital costs associated with the construction of YCGS and clarification as to the effective date of the PCCAM sharing mechanism suspension, for which we have requested an effective date of July 1, 2025, to align with the PCCAM tracker year. Any subsequent modifications by the MPSC to their final order will be reflected in our 2026 results.
Colstrip Acquisitions and Requests for Cost Recovery
In January 2023, and July 2024, we entered into definitive agreements with Avista Corporation (Avista) and Puget Sound Energy (Puget), respectively, to acquire their respective interests in Colstrip Units 3 and 4 for $0 and completed these acquisitions on January 1, 2026. Accordingly, we are responsible for the associated operating costs beginning on January 1, 2026, which we will not collect through utility base rates, until requested in a future Montana rate review. Puget and Avista will remain responsible for their respective pre-closing share of environmental, asset retirement obligations (AROs), and pension liabilities attributed to events or conditions existing prior to the closing of the transaction and for any future decommissioning and demolition costs associated with the existing facilities that comprise their interests.
While Puget and Avista remain contractually obligated for the pre-closing share of AROs, we remain the primary obligor. As such, as of March 31, 2026, we have recorded $2.8 million and $34.6 million within Accrued expenses and other and Other noncurrent liabilities, respectively, on the Condensed Consolidated Balance Sheets for these AROs, and we have recorded an indemnification asset of $2.8 million and $34.6 million with Prepaid expenses and other and Other noncurrent assets, respectively, on the Condensed Consolidated Balance Sheets.
Avista Interests - The 222 megawatts of generation capacity from Colstrip Units 3 and 4 acquired from Avista (Avista Interests) on January 1, 2026, was identified as a key element in our strategy to achieve resource adequacy for customers, as outlined in our 2023 Montana Integrated Resource Plan. Noting the costs associated with operating this resource are not currently reflected in utility customer rates, in August 2025, we filed a temporary PCCAM tariff waiver request with the MPSC that could provide a near-term cost-recovery mechanism to offset a portion of the approximately $18 million in annual incremental operating and maintenance costs associated with the Avista Interests. This waiver requested that the MPSC allow us to keep 100 percent of the net revenue associated with certain designated power sales contracts up to the amount of the operating and maintenance expenses we incur associated with our Avista Interests. Furthermore, the waiver request indicated that any net revenues from the designated contracts exceeding the operating and maintenance expenses associated with our Avista Interests would continue to flow back to retail customers. In January 2026, the MPSC approved our PCCAM tariff waiver request on an interim basis with final approval or denial subject to the ongoing PCCAM docket process.
Puget Interests - The 370 megawatts of generation capacity from Colstrip Units 3 and 4 acquired from Puget (Puget Interests) on January 1, 2026, increases our ownership share of the facility to 55 percent and provides an increase in voting share in determining strategic direction and investment decisions at the facility. Unlike the Avista Interests, we do not currently need this capacity to serve existing customers in Montana. As such, the Puget Interests are held by our FERC regulated subsidiary to isolate the costs associated with this acquired interest from our Montana retail customers. While we expect our future opportunity to serve growing customer demand, including large-load customers, may be supported by this resource, in October 2025, we signed a contract to sell the dispatchable capacity and associated energy from the Puget Interests beginning January 1,
2026, through late 2027. Revenues from this agreement are expected to largely offset the estimated $30 million of annual incremental operating and maintenance costs associated with the Puget Interests. In addition, in October 2025, we submitted a request to the FERC for approval of cost-based rates for our subsidiary that will own the Puget Interests. In February 2026, the FERC approved both the cost based rates and the contract rates retroactive to January 1, 2026. In March 2026, two MPSC commissioners, in their individual capacity, filed a motion with the FERC requesting a rehearing that largely reiterated arguments previously rejected by the FERC. We anticipate that the FERC will rule on this motion in the second quarter of 2026. If the FERC denies the motion, its prior approval order will stand. If the FERC grants the motion, it could reopen all or some portion of the proceedings.
(4) Income Taxes
We compute income tax expense for each quarter based on the estimated annual effective tax rate for the year, adjusted for certain discrete items. Our effective tax rate typically differs from the federal statutory tax rate due to the regulatory impact of flowing through the federal and state tax benefit of repairs deductions, state tax benefit of accelerated tax depreciation deductions (including bonus depreciation when applicable) and production tax credits. The regulatory accounting treatment of these deductions requires immediate income recognition for temporary tax differences of this type, which is referred to as the flow-through method. When the flow-through method of accounting for temporary differences is reflected in regulated revenues, we record deferred income taxes and establish related regulatory assets and liabilities.
During the three months ended March 31, 2026 income tax expense was $13.8 million compared to $15.2 million for the same period in 2025. For the three months ended March 31, 2026, the effective tax rate was 17.9% compared to 16.5% for the same period in 2025. The higher effective tax rate was primarily due to lower production tax credits.
(5) Comprehensive Income (Loss)
The following tables display the components of Other Comprehensive Income (Loss), after-tax, and the related tax effects (in thousands):
Three Months Ended
March 31, 2026
March 31, 2025
Before-Tax
Tax Expense
Net-of-Tax
Before-Tax
Tax Expense
Net-of-Tax
Amount
Amount
Amount
Amount
Foreign currency translation adjustment
$
(1)
$
—
$
(1)
$
1
$
—
$
1
Reclassification of net income on derivative
instruments
153
(40)
113
153
(40)
113
Other comprehensive income (loss)
$
152
$
(40)
$
112
$
154
$
(40)
$
114
Balances by classification included within accumulated other comprehensive loss (AOCL) on the Condensed Consolidated Balance Sheets are as follows, net of tax (in thousands):
March 31, 2026
December 31, 2025
Foreign currency translation
$
1,450
$
1,451
Derivative instruments designated as cash flow hedges
(8,356)
(8,469)
Postretirement medical plans
957
957
Accumulated other comprehensive loss
$
(5,949)
$
(6,061)
The following tables display the changes in AOCL by component, net of tax (in thousands):
Three Months Ended
March 31, 2026
Affected Line Item
Interest Rate
in the Condensed
Derivative
Consolidated
Instruments
Postretirement
Foreign Currency
Statements of
Designated as
Total
Income
Cash Flow Hedges
Medical Plans
Translation
Beginning balance
$
(8,469)
$
957
$
1,451
$
(6,061)
Other comprehensive loss before
reclassifications
—
—
(1)
(1)
Amounts reclassified from AOCL
Interest Expense
113
—
—
113
Net current-period other comprehensive income
(loss)
113
—
(1)
112
Ending balance
$
(8,356)
$
957
$
1,450
$
(5,949)
Three Months Ended
March 31, 2025
Affected Line Item
Interest Rate
in the Condensed
Derivative
Consolidated
Instruments
Postretirement
Foreign Currency
Statements of
Designated as
Total
Income
Cash Flow Hedges
Medical Plans
Translation
Beginning balance
$
(8,921)
$
784
$
1,433
$
(6,704)
Other comprehensive income before
reclassifications
—
—
1
1
Amounts reclassified from AOCL
Interest Expense
113
—
—
113
Net current-period other comprehensive income
113
—
1
114
Ending balance
$
(8,808)
$
784
$
1,434
$
(6,590)
(6) Financing Activities
On April 9, 2026, we amended our existing NorthWestern Energy Group $150.0 million Term Loan Credit Agreement (Term Loan) to extend the maturity date from April 10, 2026 to December 31, 2026.
We exercised a five-year renewal option on a default supply procurement agreement, which we have recorded as a finance lease on our Condensed Consolidated Balance Sheets. As a result, the finance lease term was extended and will mature on June 30, 2031.
On April 28, 2026, NWE Public Service priced $150.0 million aggregate principal amount of South Dakota First Mortgage Bonds at a fixed interest rate of 5.51 percent maturing on June 15, 2036. We expect to complete the issuance and sale of these bonds on June 15, 2026. A portion of the proceeds will be utilized to redeem all $60.0 million of NWE Public Service's 2.80 percent South Dakota First Mortgage Bonds due on June 15, 2026.
(7) Segment Information
Our reportable segments are engaged in the electric and natural gas utility businesses.
Our Chief Operating Decision Maker (CODM), who is our Chief Executive Officer, uses segment net income to evaluate if our operating segments are earning their authorized rate of return and in the annual budget and forecasting process. Our CODM also uses segment net income to determine how to allocate capital resources between our operating segments and when to allocate the resources necessary to file for rate reviews. Segment asset and capital expenditure information is not provided for our reportable segments. As an integrated electric and gas utility, we operate significant assets that are not dedicated to a specific reportable segment.
Financial data for the reportable segments are as follows (in thousands):
Three Months Ended
March 31, 2026
Electric
Gas
Total
Operating revenues
$
362,054
$
135,516
$
497,570
Fuel, purchased supply and direct transmission expense (exclusive of depreciation
and depletion shown separately below)
90,275
55,290
145,565
Operating, general, and administrative
89,601
27,131
116,732
Property and other taxes
39,211
11,152
50,363
Depreciation and depletion
55,469
11,362
66,831
Interest expense, net
(30,185)
(7,871)
(38,056)
Other income, net
1,545
624
2,169
Income tax expense
(11,483)
(3,135)
(14,618)
Segment net income
$
47,375
$
20,199
$
67,574
Reconciliation to consolidated net income
Other, net(1)
(4,118)
Consolidated net income
$
63,456
Three Months Ended
March 31, 2025
Electric
Gas
Total
Operating revenues
$
335,483
$
131,147
$
466,630
Fuel, purchased supply and direct transmission expense (exclusive of depreciation
and depletion shown separately below)
92,752
45,445
138,197
Operating, general, and administrative
72,479
25,170
97,649
Property and other taxes
33,286
9,795
43,081
Depreciation and depletion
52,488
9,912
62,400
Interest expense, net
(27,756)
(7,034)
(34,790)
Other income, net
2,490
1,091
3,581
Income tax expense
(9,872)
(4,427)
(14,299)
Segment net income
$
49,340
$
30,455
$
79,795
Reconciliation to consolidated net income
Other, net(1)
(2,855)
Consolidated net income
$
76,940
(1) Consists of unallocated corporate costs, including merger-related costs, and certain limited unregulated activity within the energy industry.
(8) Revenue from Contracts with Customers
Nature of Goods and Services
We provide retail electric and natural gas services to three primary customer classes. Our largest customer class consists of residential customers, which includes single private dwellings and individual apartments. Our commercial customers consist primarily of main street businesses, and our industrial customers consist primarily of manufacturing and processing businesses that turn raw materials into products.
Electric Segment - Our regulated electric utility business primarily provides generation, transmission, and distribution services to customers in our Montana and South Dakota jurisdictions. We recognize revenue when electricity is delivered to the customer. Payments on our tariff-based sales are generally due 20-30 days after the billing date.
Natural Gas Segment - Our regulated natural gas utility business primarily provides production, storage, transmission, and distribution services to customers in our Montana, South Dakota, and Nebraska jurisdictions. We recognize revenue when natural gas is delivered to the customer. Payments on our tariff-based sales are generally due 20-30 days after the billing date.
Disaggregation of Revenue
The following tables disaggregate our revenue by major source and customer class (in thousands):
Three Months Ended
March 31, 2026
March 31, 2025
Electric
Natural Gas
Total
Electric
Natural Gas
Total
Montana
$
120,438
$
48,138
$
168,576
$
114,977
$
51,418
$
166,395
South Dakota
23,229
14,524
37,753
22,292
15,570
37,862
Nebraska
—
11,161
11,161
—
13,209
13,209
Residential
143,667
73,823
217,490
137,269
80,197
217,466
Montana
106,482
26,877
133,359
96,952
26,758
123,710
South Dakota
31,397
11,754
43,151
29,315
11,175
40,490
Nebraska
—
6,506
6,506
—
7,441
7,441
Commercial
137,879
45,137
183,016
126,267
45,374
171,641
Industrial
11,864
791
12,655
10,100
484
10,584
Lighting, governmental, irrigation, and interdepartmental
5,509
524
6,033
4,693
591
5,284
Total Retail Revenues
298,919
120,275
419,194
278,329
126,646
404,975
Regulatory Amortization
12,277
(1,001)
11,276
27,690
(9,436)
18,254
Transmission
28,765
—
28,765
26,555
—
26,555
Transportation, wholesale and other
22,093
16,242
38,335
2,909
13,937
16,846
Total Revenues
$
362,054
$
135,516
$
497,570
$
335,483
$
131,147
$
466,630
(9) Earnings Per Share
Basic earnings per share are computed by dividing earnings applicable to common stock by the weighted average number of common shares outstanding for the period. Diluted earnings per share reflect the potential dilution of common stock equivalent shares that could occur if unvested shares were to vest. Common stock equivalent shares are calculated using the treasury stock method, as applicable. The dilutive effect is computed by dividing earnings applicable to common stock by the weighted average number of common shares outstanding plus the effect of the outstanding unvested restricted stock and performance share awards. Average shares used in computing the basic and diluted earnings per share are as follows:
Three Months Ended
March 31, 2026
March 31, 2025
Basic computation
61,460,756
61,339,498
Dilutive effect of: Performance and restricted share awards(1)
171,246
86,603
Diluted computation
61,632,002
61,426,101
(1)
Performance share awards are included in diluted weighted average number of shares outstanding based upon what would be issued if the end of the most recent reporting period was the end of the term of the award.
As of March 31, 2026, there were no shares from performance and restricted share awards which were antidilutive and excluded from the earnings per share calculations, compared to 49,071 shares as of March 31, 2025.
(10) Employee Benefit Plans
We sponsor and/or contribute to pension and postretirement health care and life insurance benefit plans for eligible employees. Net periodic benefit cost (credit) for our pension and other postretirement plans consists of the following (in thousands):
Pension Benefits
Other Postretirement Benefits
Three Months Ended March 31,
Three Months Ended March 31,
2026
2025
2026
2025
Components of Net Periodic Benefit Cost (Credit)
Service cost
$
1,098
$
1,195
$
54
$
62
Interest cost
2,891
6,045
102
127
Expected return on plan assets
(2,923)
(5,742)
(403)
(354)
Recognized actuarial loss (gain)
—
—
(161)
(70)
Net periodic benefit cost (credit)
$
1,066
$
1,498
$
(408)
$
(235)
We contributed $2.0 million to our pension plans during the three months ended March 31, 2026. We expect to contribute an additional $9.5 million to our pension plans during the remainder of 2026.
(11) Commitments and Contingencies Parent Guarantee
NorthWestern Energy Group, Inc. has guaranteed the contractual obligations of its wholly-owned subsidiary, NorthWestern Colstrip 370Pu, LLC (NW Colstrip 370), to its counterparty to an agreement for the sale of capacity and energy from our recently acquired 370 megawatt ownership interest in the Colstrip facility. The guarantee exists during the January 2026 through September 2027 term of the agreement. The guarantee is unconditional and irrevocable, covering all payment obligations of the subsidiary under the contract up to a maximum amount of $15.0 million. The guarantee is triggered in an event where NW Colstrip 370 fails to pay any amounts that could come due under the agreement. As of March 31, 2026, no demand has been made under the guarantee and management believes that risk of material payment under this guarantee is remote.
ENVIRONMENTAL LIABILITIES AND REGULATION
The circumstances set forth in Note 20 - Commitments and Contingencies to the financial statements included in the NorthWestern Energy Group Annual Report on Form 10-K for the year ended December 31, 2025 appropriately represent, in all material respects, the current status of our environmental liabilities and regulation.
LEGAL PROCEEDINGS
We are subject to various legal proceedings, governmental audits and claims that arise in the ordinary course of business. In our opinion, the amount of ultimate liability with respect to these other actions will not materially affect our financial position, results of operations, or cash flows.