NRG Energy — Third Quarter 2026 Earnings Summary

Financial Performance:

• GAAP Net Income for Q3 2026 was $561 million, an increase of $409 million from $152 million in the prior year period.
• GAAP EPS (basic) was $2.59 for Q3 2026, compared to $0.70 in the prior year.
• Adjusted Net Income for Q3 2026 was $983 million, an increase of $446 million from $537 million in the prior year.
• Adjusted EPS was $4.68 for Q3 2026, an increase of $1.90 from $2.78 in the prior year.
• Adjusted EBITDA for Q3 2026 was $2,013 million, up $808 million from $1,205 million in the prior year.
• Free Cash Flow before Growth Investments (FCFbG) for Q3 2026 was $1,242 million, compared to $828 million in the prior year.
• GAAP Cash Provided by Operating Activities for Q3 2026 was $1,097 million, compared to $484 million in the prior year.
• For the nine months ended September 30, 2026, GAAP Net Income was $1,192 million (vs. $798 million prior year) and Adjusted Net Income was $1,605 million (vs. $1,406 million prior year).
• Revenue for Q3 2026 was $9,466 million, compared to $7,635 million in the prior year.
• Total liquidity as of September 30, 2026, was $6.0 billion, down $3.6 billion from December 31, 2025, primarily due to funding the LS Power acquisition.

Guidance and Future Outlook:

• NRG reaffirmed 2026 guidance: Adjusted Net Income ($1,685–$2,115 million), Adjusted EPS ($7.90–$9.90), Adjusted EBITDA ($5,325–$5,825 million), and FCFbG ($2,800–$3,300 million).
• Initiated 2027 guidance: Adjusted Net Income ($1,665–$2,075 million), Adjusted EPS ($8.05–$10.05), Adjusted EBITDA ($5,500–$6,000 million), and FCFbG ($2,900–$3,400 million).
• 2027 guidance excludes expected impacts of the announced 4.9 GW asset sale.
• The company plans to return $1.0 billion to shareholders via share repurchases and approximately $407 million via dividends in 2026.
• Through October 31, 2026, the company completed $977 million in share repurchases and distributed $302 million in dividends.
• A quarterly dividend of $0.475 per share ($1.90 annualized) was declared, payable November 16, 2026.
• The 2027 base capital allocation plan includes $1 billion debt reduction, $1 billion share repurchases, and an 8% increase in the annual common dividend to $2.05 per share.
• Expected proceeds from the 4.9 GW asset sale will support a pro forma 2027 plan of $3 billion in share repurchases (including $1 billion expected before Q4 2026) and $3 billion in debt reduction.

Business Segments and Product Lines:

• Texas: Q3 2026 Adjusted EBITDA was $1,018 million (up $211 million YoY), driven by increased retail margins and favorable weather.
• East: Q3 2026 Adjusted EBITDA was $614 million (up $507 million YoY), driven by contributions from new generation assets/CPower and higher capacity prices, partially offset by higher power supply costs during Winter Storm Fern.
• West/Other: Q3 2026 Adjusted EBITDA was $64 million (up $51 million YoY), driven by lower operating expenses from a lease expiration.
• Vivint Smart Home: Q3 2026 Adjusted EBITDA was $317 million (up $39 million YoY), driven by higher new customer adds and increased monthly recurring service margin.
• The 1.2 GW "Bring Your Own Power" (BYOP) data center project remains on track.
• The company operates approximately 25 GW of power generation and serves eight million customers.

Market and Competitive Landscape:

• The company retains its entire PJM portfolio and CPower assets acquired from LS Power in January 2026.
• NRG was awarded POWER Magazine's 2026 Top Plant Water Award for its WA Parish plant's wastewater treatment system.
• NRG received the 2026 Excellence in Surface Coal Mining Reclamation Good Neighbor award from the Office of Surface Mining Reclamation and Enforcement for the Dewey Prairie Garden project.

Risks and Challenges:

• Q3 2026 results were partially offset by higher depreciation, amortization, and interest expense related to the LS Power acquisition.
• Results included unrealized, non-cash losses on economic hedges ($155 million loss in Q3 2026) driven by decreases in natural gas prices, creating temporary accounting variances.
• Forward-looking statements cite risks including geopolitical conflicts, trade disputes, inflation, integration of acquired assets, weather conditions, commodity price volatility, and regulatory changes.

Management Commentary and Tone:

• Robert Gaudette, President & CEO, stated the results reflect the "depth of NRG" and a focus on "execution and deliberate" capital allocation to return value to shareholders.
• Management emphasized the strategy of returning capital to shareholders while supporting future growth investments.

Other Key Points:

• NRG entered a definitive agreement to sell six natural-gas fired generation assets totaling 4.9 GW to LS Power for $4 billion in cash proceeds, subject to closing adjustments.
• The asset sale is expected to close in the second quarter of 2027, pending regulatory approvals (HSR, FERC, NYSPSC).
• Proceeds from the asset sale will be used to support the 2027 pro forma capital allocation plan, including $3 billion in share repurchases and $3 billion in debt reduction.
• The company plans to provide updated 2027 financial guidance and capital allocation plans following the closing of the asset sale.