Southern Company's (SO -0.20%) days of high growth may be behind it, but the company is now turning a corner into more stable operational growth. Second-quarter earnings showed a bit of that, with revenue falling 2.9%, to $4.3 billion, as wholesale and fuel-related revenue dropped. But net income was up 2.9%, to $629 million, or $0.69 per share. 

The financial improvement came on the back of increasing consumption across all customer classes. Here are the important numbers from Southern Company's earnings.

Customers turn the lights on again
On a broad level, U.S. consumers are starting to worry less about their energy bills as the economy improves, which is good for utilities. Southern Company saw demand increase in residential, commercial, and industrial segments for the second-straight quarter on a weather-adjusted basis, something that hasn't happened in 11 years.

Below is a table showing just how growth looked across the customer segments.

 

Q2 2015 kWh Sales

Growth

Residential

12,548

4.6%

Commercial

13,654

2.3%

Industrial

13,645

0.1%

Total Retail Sales

40,072

2.2%

Source: Southern Company earnings release.

Growing end-user demand for the regulated utility is a positive sign because it means revenue and asset growth may continue in the future.

Wholesale continues to struggle
One national trend we've seen in the past few years are lower returns from the wholesale energy market, something Southern Company is facing, as well. Wholesale sales fell 13%, to $448 million in the quarter, despite a 1.3% increase in kWh delivered.

Wholesale margins are under pressure from a variety of sources from low natural-gas prices to renewable energy offsetting some of the high-margin midday demand. I would expect this trend to continue long term, so Southern Company will likely lean on its retail business to drive earnings in the future.

Utilities beginning to adapt to new challenges
Another factor to watch in coming quarters is how companies like Southern Company handle the changing solar landscape in states like Georgia and Alabama. Policies favorable to solar are starting to open up, which could put further pressure on wholesale markets, as well as the regulated utility's demand.

But forward-looking utilities are starting to find ways to partner with solar companies on community solar and even leasing programs. If Southern Company can take advantage of solar, it could be a boost to growth while reducing risk in the business long term.