Genie Energy Earnings Jump Y/Y in Q2 on Margin Expansion

Shares of Genie Energy, Ltd. GNE have gained 3.8% since reporting results for the second quarter of 2026. This compares with the S&P 500 index’s 0.1% return over the same time frame. Over the past month, the stock has gained 3.4% compared with the S&P 500’s 1.5% return.

Earnings & Revenue Performance

Second-quarter revenues declined 4.6% year over year to $100.4 million from $105.3 million. Earnings per share increased to 43 cents from 9 cents in the prior-year quarter, while net income attributable to common stockholders rose to $11.4 million from $2.3 million. Gross profit advanced 43.4% to $33.7 million, and the gross margin expanded to 33.5% from 22.3%. Income from operations increased to $6.5 million from $2.3 million, while adjusted EBITDA climbed to $7.5 million from $3 million.

Genie Energy Ltd. Price, Consensus and EPS Surprise

Genie Energy Ltd. price-consensus-eps-surprise-chart | Genie Energy Ltd. Quote

Retail & Renewables Metrics

Genie Retail Energy revenues fell 4.9% year over year to $94.1 million. Electricity revenues decreased 7% to $83.6 million, while natural gas revenues increased 16.2% year over year to $10.6 million. GRE gross profit rose 42.2% to $30.3 million, with the gross margin widening 1,070 basis points to 32.2%. Its operating income increased 108.3% year over year to $8.3 million and adjusted EBITDA advanced 96.7% to $8.7 million.

GRE ended the quarter with 345,000 residential customer equivalents. Gross meter additions declined to 65,000 from 70,000, while churn rose to 5.9% from 4.8%. Genie Renewables revenues were nearly unchanged at $6.3 million, but gross profit increased 55% to $3.3 million. GREW posted operating income of $0.1 million and adjusted EBITDA of $0.3 million, reversing respective losses of $0.2 million and $0.1 million.

Cash, restricted cash and marketable equity securities totaled $204.3 million, while working capital was $199.6 million and net debt was $6.8 million.

Management Commentary

CEO Michael Stein said that normalized wholesale energy-market conditions restored GRE’s gross margin to a level comparable with its long-term historical average. He said that customer additions were weighted toward higher-value customers and diversified the base through growth in the Texas electricity and California natural-gas markets. Management expects those cohorts to support future results.

Stein said that Diversegy is expanding its book of business at a double-digit annualized rate and using artificial intelligence to refine customer acquisition and tailor offerings. Genie Solar’s second New York community-solar project began operating late in the quarter and is expected to affect results from the third quarter. Roded expanded pallet production in Israel, approached capacity at its existing facility, and advanced plans for a larger Israeli plant and a U.S. manufacturing site.

Factors Behind the Results

GRE’s revenue decline primarily reflected the expiration of low-margin aggregation agreements, which reduced consumption but had limited bottom-line impacts. Electricity volume fell 17%, partly offset by a 12% increase in revenues per kilowatt-hour. Natural-gas volume declined 23%, while revenues per therm rose 50%.

Consolidated selling, general and administrative expenses increased 28% to $27.2 million, largely because GRE shifted acquisitions toward higher-cost channels that management said typically yield greater customer lifetime value. Other income rose to $3.8 million from $54,000, primarily reflecting investment gains, including a $0.7-million gain on the sale of an investment property. The effective tax rate fell to 2.0% from 43.8% due to a federal investment tax credit tied to the community-solar project activated during the quarter.

Outlook

Management maintained its 2026 adjusted EBITDA guidance of $32.5-$40 million. It expects Diversegy and Genie Solar to expand their bottom lines in coming quarters and plans to increase cash generation across GRE, Diversegy and Genie Solar, while continuing growth investments, opportunistic share repurchases and quarterly dividends.

Other Developments

On April 7, Genie Energy obtained control of Able Minds, an applied behavioral-analysis therapy provider for children with autism, after cumulative contributions of $1 million increased its stake to 57%. Able Minds contributed $0.2 million to the quarterly revenues and was being integrated into GREW. In June, Genie Energysold an investment property for $7.3 million, receiving $6.6 million after direct costs. Following an earlier change in federal solar tax-credit timing, Genie Energyalso identified several solar projects for discontinuation after reassessing their financial viability.

7 Best Stocks for the Next 30 Days

Just released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."

Since 1988, the full list has beaten the market more than 2X over with an average gain of +23.9% per year. So be sure to give these hand picked 7 your immediate attention. 

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research