NRG Energy — Second Quarter 2026 Earnings Summary

Financial Performance

• GAAP Net Income for the quarter ended June 30, 2026, was $506 million, an increase of $610 million from the prior year period.
• GAAP EPS (basic) was $2.32 for the quarter, compared to $(0.62) in the prior year; YTD GAAP EPS was $2.86 compared to $3.11.
• Adjusted Net Income was $315 million for the quarter, a decrease of $24 million from the prior year; YTD Adjusted Net Income was $623 million compared to $870 million.
• Adjusted EPS was $1.49 for the quarter, down $0.24 from the prior year; YTD Adjusted EPS was $2.98 compared to $4.42.
• Adjusted EBITDA was $1,217 million for the quarter, an increase of $308 million from the prior year; YTD Adjusted EBITDA was $2,297 million compared to $2,035 million.
• GAAP Cash Provided by Operating Activities was $1,117 million for the quarter, up from $451 million in the prior year; YTD was $948 million compared to $1,306 million.
• Free Cash Flow before Growth Investments (FCFbG) was $1,025 million for the quarter, up from $914 million in the prior year; YTD FCFbG was $959 million compared to $1,207 million.
• Revenue for the quarter was $7,481 million compared to $6,740 million in the prior year; YTD revenue was $17,737 million compared to $15,325 million.
• Total liquidity was $5.3 billion as of June 30, 2026, down $4.3 billion from December 31, 2025, primarily due to funding the LS Power acquisition.
• Cash and cash equivalents were $162 million as of June 30, 2026, down from $4,708 million at December 31, 2025.
• Total debt increased to $23.26 billion (current portion $1.51 billion + long-term $21.74 billion) as of June 30, 2026, from $16.73 billion at December 31, 2025.

Guidance and Future Outlook

• NRG reaffirmed its full-year 2026 guidance ranges: Adjusted Net Income of $1,685–$2,115 million, Adjusted EPS of $7.90–$9.90, Adjusted EBITDA of $5,325–$5,825 million, and FCFbG of $2,800–$3,300 million.
• The company plans to bring online a total of 1.5 GW of new power generation by mid-2028 through the Texas Energy Fund program.

Business Segments and Product Lines

• Texas: Adjusted EBITDA was $381 million for the quarter (down $131 million YoY) and $597 million YTD (down $214 million YoY), driven by higher supply costs, mild winter weather reducing retail load, and operating expenses for new assets.
• East: Adjusted EBITDA was $469 million for the quarter (up $370 million YoY) and $933 million YTD (up $360 million YoY), driven by contributions from new generation assets and CPower, and higher capacity prices, partially offset by higher power supply costs during Winter Storm Fern.
• West/Other: Adjusted EBITDA was $66 million for the quarter (up $27 million YoY) and $172 million YTD (up $60 million YoY), driven by lower operating expenses from a lease expiration in May 2025.
• Vivint Smart Home: Adjusted EBITDA was $301 million for the quarter (up $42 million YoY) and $595 million YTD (up $56 million YoY), attributable to higher new customer adds and increased monthly recurring service margin.
• Strategic Developments: Advanced the "Bring Your Own Power" (BYOP) strategy with a hyperscaler for a 1.2 GW combined cycle natural gas facility in Texas.
• Texas Energy Fund (TEF): Achieved commercial operations at the 415 MW T.H. Wharton facility, NRG's first new build generation asset in nearly a decade; entered into a completion bonus grant agreement with the PUCT for up to $54.72 million. Two additional TEF projects remain on time and on budget.

Market and Competitive Landscape

• The company noted higher realized capacity prices in the East and volatility in energy and fuel prices as market factors.
• The BYOP strategy is positioned to meet large load growth from data centers while supporting grid reliability and energy affordability.

Risks and Challenges

• Risks include integration of the LS Power portfolio, potential disruption to ongoing operations, and failure to realize expected synergies.
• Weather conditions, extreme weather events, and volatility in demand for power and gas remain key risks.
• Risks related to data privacy, cybersecurity, and the use of artificial intelligence are noted.
• Regulatory changes, customer affordability concerns, and the ability to execute capital allocation plans are cited as potential challenges.
• The company faces risks associated with the volatility of energy and fuel prices and the failure of customers or counterparties to perform under contracts.

Management Commentary and Tone

• Robert Gaudette, President & CEO, stated the company delivered a solid second quarter and reaffirmed 2026 guidance.
• Management expressed confidence in the discipline and execution driving NRG forward.
• The CEO characterized the BYOP model as "the model for how large load growth should work," emphasizing customer-backed investment with protected reliability and affordability.

Other Key Points

• Capital Allocation: The company plans to return $1.0 billion to shareholders via share repurchases and approximately $407 million via dividends in 2026.
• Share Repurchases: Through July 31, 2026, NRG completed $932 million in share repurchases.
• Dividends: Declared a quarterly dividend of $0.475 per common share ($1.90 annualized), payable August 17, 2026, to record holders as of August 3, 2026. $202 million in dividends were distributed through July 31, 2026.
• Acquisitions: The results benefited from the addition of the portfolio of assets acquired from LS Power, including generation assets and CPower.
• Hedge Gains: Results benefited from unrealized, non-cash gains on economic hedges in the East, primarily driven by the reversal of previously recognized unrealized losses and increases in RGGI prices.
• Conference Call: A conference call was hosted on August 4, 2026, to discuss results.