10-Q · April 24, 2026
Phillips Edison reported solid Q1 results with total revenues of $190,741,000, up $12,430,000 (7.0%) versus Q1 2025, driven by rental income growth and net acquisition activity. Same-center rental income rose $3,717,000…
Earnings analysis · 10-Q
PECO earnings analysis
Filed July 24, 2026 · Our reading of the company's report
The latest report
Phillips Edison delivered Q2 revenue of $189.6 million, up 6.7% year over year, with operating margin expanding to 28.8% from 24.2%; EPS increased to $0.33 from $0.10 but was supported by a $19.4 million disposal gain.…
Read full summary
Phillips Edison delivered Q2 revenue of $189.6 million, up 6.7% year over year, with operating margin expanding to 28.8% from 24.2%; EPS increased to $0.33 from $0.10 but was supported by a $19.4 million disposal gain. Same-center NOI growth of 3.8% and lease spreads of 33.7% on new deals and 21.2% on renewals demonstrate healthy grocery-anchored retail fundamentals. Offsetting factors include a 6.0% rise in quarterly interest expense, debt growth to $2.478 billion, and retention declining to 89.6%. The filing did not provide explicit revenue or EPS guidance.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $0.33
- Operating margin
- 28.8%
What stood out
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Revenue rises 6.7% year over year
Q2 revenue increased $11.9 million, or 6.7%, year over year to $189.6 million, driven by a $6.8 million same-center rental-income increase and $4.2 million from net acquisition activity. Revenue was down modestly from Q1's implied $190.7 million level.
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Operating margin expands year over year
Operating income was $54.6 million, producing a 28.8% operating margin, versus $43.0 million and 24.2% a year earlier—an approximately 4.6-point margin expansion. Margin was lower than Q1 2026's implied 30.5%, as quarterly operating income fell from an implied $58.2 million.
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EPS and Core FFO per share improve
Diluted EPS was $0.33, up from $0.10 in Q2 2025 and $0.24 in Q1 2026. Net income was aided by a $19.4 million gain on property disposals, while Core FFO per diluted share improved to $0.69 from $0.64.
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Same-center NOI grows 3.8%
Same-Center NOI grew $4.4 million, or 3.8%, to $120.6 million. The company cited a $0.56 increase in average minimum rent per square foot and a 0.3% improvement in average occupancy as key rental-income drivers.
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Strong new and renewal lease spreads
Leasing economics remained strong: Q2 new-lease comparable rent spreads were 33.7% and renewal comparable spreads were 21.2%. Inline leased occupancy improved to 95.5% from 94.8% year over year, while total occupancy was 97.3%.
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Operating cash flow rises; capex declines
Six-month operating cash flow rose $16.9 million, or 10.8%, to $173.6 million. Cash capital expenditures were $50.5 million, equal to 29.1% of operating cash flow; this implies $123.1 million of operating cash flow after cash capex, before acquisitions and dispositions.
What to watch
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Higher debt drives interest-cost growth
Interest expense increased $1.7 million, or 6.0%, year over year to $29.4 million in Q2, primarily because debt outstanding was higher. Gross debt obligations increased to $2.478 billion at June 30, 2026 from $2.402 billion at December 31, 2025.
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Retention rate declined 4.0 points
Portfolio retention declined to 89.6% from 93.6% in Q2 2025, despite strong leasing spreads. Management notes that retailer rationalization, bankruptcies and strategic store closures can create near-term downtime.
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Reported earnings benefited from asset-sale gain
Net income of $45.3 million included a $19.4 million property-disposal gain from two properties and one land parcel. This non-recurring gain accounted for a material portion of reported earnings growth versus Q2 2025 net income of $14.3 million.
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No risk-factor updates; tenant concentration remains
Risk-factor disclosure was unchanged: Item 1A states there were no material changes from the 2025 Form 10-K. Nevertheless, tenant concentration remains notable, as the top 20 tenants represent 29.0% of annualized base rent.
Management's outlook
The 10-Q contains no explicit company revenue or EPS guidance. Management said 2026 capital-improvement and redevelopment obligations are expected to be funded through operating cash flow, disposition proceeds and/or the revolving credit facility; in-process projects have an estimated $82.0 million total investment and underwritten incremental unlevered yields of 9%-12%.
Earlier filings 4
10-Q · May 3, 2023
Q1 2023 results showed revenue and EPS growth with margin expansion but meaningful investing outflows and higher net debt. Total revenues were $151,064,000 (up from $142,163,000 a year ago) and EPS was $0.14 (vs $0.09).…
10-Q · November 3, 2022
Q3 2022 results show revenue growth and an operating-margin improvement but lower EPS and a sharp drawdown in cash. Total revenues were $145.7M (three months ended Sept. 30, 2022) vs $132.3M a year earlier; net income…
10-Q · August 5, 2022
Phillips Edison & Company reported Q2 2022 revenue of $142.516M (up from $133.070M in Q2 2021) and net income attributable to stockholders of $13.528M (EPS $0.12 vs $0.06 prior-year quarter). Operating income expanded…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.