Otter Tail Corporation Reports $7.6 Million Net Loss in Q2 2026 Amid Rising Operating Expenses

Otter Tail Corporation reported a net loss of $7.6 million for the second quarter of 2026, a significant decline from a net income of $77.7 million in the same period last year. The company's operating revenues for the quarter were $334.4 million, a slight increase from $333.0 million in the prior year. However, the increase in revenues was overshadowed by a substantial rise in operating expenses, which totaled $358.6 million, up from $235.6 million in the previous year. This increase was primarily driven by a $103.5 million legal settlement expense related to ongoing antitrust litigation in the PVC pipe market.

In the first half of 2026, Otter Tail's operating revenues reached $681.4 million, compared to $670.4 million in the same period of 2025. The Electric segment generated $287.2 million in revenues, reflecting a 3.1% increase year-over-year, while the Manufacturing segment saw revenues rise by 11% to $178.0 million. Conversely, the Plastics segment experienced a decline in revenues, falling 6.6% to $216.2 million, primarily due to a decrease in average sales prices despite a rise in sales volumes.

The company’s total assets increased to $4.29 billion as of June 30, 2026, up from $3.96 billion at the end of 2025. This growth was supported by a rise in property, plant, and equipment, which increased to $3.14 billion from $2.88 billion. The company’s long-term debt also rose to $1.13 billion, compared to $963.6 million at the end of the previous year, reflecting ongoing investments in infrastructure and capital projects, particularly in renewable energy initiatives.

Operationally, Otter Tail reported a 4.7% increase in retail kilowatt-hour sales in its Electric segment, driven by favorable weather conditions. However, wholesale sales from company generation plummeted by 98.2%, largely due to planned outages at coal-fired facilities. The company’s employee headcount remained stable, with no significant changes reported in staffing levels. Looking ahead, Otter Tail anticipates continued challenges from market conditions and regulatory pressures, particularly related to the ongoing legal matters and the impact of rising interest rates on its financing costs. The company remains focused on executing its strategic initiatives, including investments in renewable energy projects and infrastructure improvements.