NRG Energy · Earnings release

NRG Energy, Inc. Reports Full Year 2024 Financial Results

•Exceeded the top end of 2024 raised Adjusted EPS guidance and returned $1.3 billion of capital to shareholders

•Announcing major Project Development Agreement with GE Vernova and Kiewit to bring up to 5.4 GW of new gas-fired generation online between 2029-2032, including turbine procurement and turnkey engineering project services

•Announcing Letters of Intent with two data center developers for NRG-owned sites, to be powered by NRG once developed; initial phase targets 400 MW

•1.1 GW of eligible Texas Energy Fund projects now in active due diligence review; turbine onsite at T.H. Wharton, the first 415 MW of the 1.5 GW previously announced natural gas development projects in Texas

•Reaffirming 2025 guidance ranges; reiterating our growth plan and capital allocation framework

HOUSTON—February 26, 2025—NRG Energy, Inc. (NYSE: NRG) today reported GAAP Net Income of $643 million for the three months ended December 31, 2024 and $1.1 billion for the full year 2024. GAAP EPS — basic was $5.14, Cash Provided by Operating Activities was $2.3 billion, Adjusted Net Income was $1.4 billion, Adjusted EPS was $6.83, Adjusted EBITDA was $3.8 billion, and Free Cash Flow before Growth (FCFbG) was $2.1 billion for the full year 2024.

“NRG had a stellar year, executing across all our strategic priorities. Our Adjusted EPS exceeded the top end of raised guidance, we announced the first-of-its-kind residential VPP of scale through our Renew Home and Google Cloud partnerships, and we delivered on our capital allocation commitments,” said Larry Coben, NRG Chair, President and Chief Executive Officer. “Today, as promised, we are thrilled to share with you the initial steps and early successes on our roadmap to unlock the significant upside opportunities created by this new era of sustained demand growth. I look forward to updating you on our progress. This is an exciting time to be a part of NRG.”

NRG is reaffirming its 2025 guidance ranges for Adjusted EPS of $6.75 - $7.75, FCFbG of $1,975 - $2,225 million, and other metrics found in Table 2.

Consolidated Financial Results

Table 1

Three Months Ended

Twelve Months Ended

($ in millions, except per share amounts)

GAAP Net Income/(Loss)

$

$

$

$

Adjusted Net Incomea b

$

$

$

$

GAAP EPS — basic

$

$

$

$

Adjusted EPSa c

$

$

$

$

Adjusted EBITDAa d

$

$

$

$

Cash Provided/(Used) by Operating Activities

$

$

$

$

Free Cash Flow Before Growth Investments (FCFbG)a

$

$

$

$

a Adjusted Net Income, Adjusted EPS, Adjusted EBITDA, and FCFbG are non-GAAP financial measures; see Appendix tables A-1 through A-8 for GAAP reconciliations. Adjusted EPS, Adjusted Net Income, and Adjusted EBITDA exclude fair value adjustments related to derivatives

b Adjusted Net Income as shown here is 'Adjusted Net Income available for common stockholders'; see Appendix tables A-1 through A-6

c Adjusted EPS calculated based on Adjusted Net Income divided by weighted average number of common shares outstanding - basic

d Adjusted EBITDA recast to exclude all impacts of amortization of capitalized contract costs related to fulfillment, now reflected in depreciation and amortization

NRG's GAAP Net Income for the full year 2024 was $1.3 billion higher than prior year. The year-over-year change was primarily driven by unrealized non-cash mark-to-market gains on economic hedges in 2024, compared to losses in 2023. Certain economic hedge positions are required to be marked-to-market every period, while the customer contracts related to these items are not, resulting in temporary unrealized non-cash losses or gains on the economic hedges that are not reflective of the expected economics at future settlement. The comparison is also affected by asset sales in 2023 and losses incurred on debt extinguishment in 2024. Full year 2024 GAAP Net Income results benefited overall from the strong operational performance of the business, as detailed in the Adjusted EBITDA segment results below.

Adjusted Net Income for full year 2024 was $1.4 billion, $332 million higher than prior year, primarily driven by $470 million improvement in Adjusted EBITDA described in the segment results below, partially offset by an increase in depreciation and amortization from Vivint Smart Home related to full year 2024 results compared to ten months of NRG's ownership in 2023. Adjusted EPS was $6.83 for full year 2024, $2.11 higher than prior year as a result of strong financial and operating performance, as well as reduction of 22 million in the weighted average number of common shares outstanding – basic.

NRG’s full year 2024 Adjusted EPS, FCFbG, and other metrics grew significantly, due to superior consolidated financial and operational performance. NRG's retail energy business continued to deliver strong margins while the Company's generation fleet had excellent 88% In-the-Money-Availability. NRG's Smart Home segment delivered another year above expectations with over 5% net subscriber growth, 6% margin expansion, and a record-high retention rate of 90%.

NRG is reaffirming its guidance for 2025 as set forth below.

Table 2: Adjusted Net Income, Adjusted EPS, Adjusted EBITDA, and FCFbG Guidance for 2025a

($ in millions, except per share amounts)

Guidance

G1Adjusted Net Income

G2Adjusted EPS

G3Adjusted EBITDA

G4FCFbG

a Adjusted Net Income, Adjusted EPS, Adjusted EBITDA, and FCFbG are non-GAAP financial measures; see Appendix tables A-10 through A-12 for GAAP reconciliations. Adjusted Net Income, Adjusted EPS, and Adjusted EBITDA exclude fair value adjustments related to derivatives. The Company does not guide to GAAP Net Income due to the impact of such fair value adjustments related to derivatives in a given year

Capital Allocation

NRG remains committed to its capital allocation policy targeting, after debt reduction, approximately 80% of cash available for allocation to return of capital, and approximately 20% to investments in strategic growth that meet or exceed stated hurdle rates.

In 2024, the Company returned $1.263 billion to shareholders through $925 million in share repurchases -- exceeding its original share repurchase target by $100 million -- and $338 million in common stock dividends. The Company executed $342 million in liability management and achieved its target credit metrics of 2.50x - 2.75x Net Debt to Adjusted EBITDA, a full year earlier than its original target.

For 2025, the Company reiterates its previously announced capital allocation plan, which includes $1.3 billion in share repurchases, and common stock dividends of approximately $345 million. As of February 20, 2025, the Company has executed $174 million of its $1.3 billion 2025 share repurchase plan.

On January 22, 2025, NRG declared a quarterly dividend of $0.44 per common share, or $1.76 per share on an annualized basis. This dividend represented an 8% increase, in line with the Company's annual dividend target growth rate of 7-9% per share. The dividend was paid on February 18, 2025 to common stockholders of record as of February 3, 2025.

NRG's share repurchase program and common stock dividend are subject to maintaining satisfactory credit metrics, available capital, market conditions, and compliance with associated laws and regulations. The timing and amount of any shares of

2

NRG’s common stock repurchased under the share repurchase authorization will be determined by NRG’s management based on market conditions and other factors. NRG will only repurchase shares when management believes it would not jeopardize the Company’s ability to maintain satisfactory credit ratings.

NRG Strategic Developments

Site Development Updates

NRG has signed a strategic Project Development Agreement with GE Vernova (GEV) and Kiewit's subsidiary, TIC, to develop and construct up to 5.4 GW of new gas-fired, combined cycle generation projects. Together, the parties intend to develop sites selected by NRG as part of the Company's comprehensive 2024 portfolio review, with priority given to Texas and East region sites in the near-term. The generation facilities will be owned and operated by NRG. Additionally, NRG has entered into a slot reservation agreement with GEV for the procurement of 1.2 GW of 7HA gas turbines. The first projects under this comprehensive development agreement are expected to commence operations by the end of 2029.

NRG has also entered into Letters of Intent (LOIs) with two leading data center developers, Menlo Equities and PowLan. Targeting 400 MW of retail supply in the initial phase, these arrangements have the potential to scale to 6.5 GW, with work expected to start in 2026. The pricing structures are expected to incorporate the planned sites' unique value and NRG's comprehensive supply optimization expertise.

NRG has fully dedicated engineering, construction, and offtake structuring teams to execute its tailored data center strategy.

1.5 GW Texas Brownfield Natural Gas New Build Updates

NRG is advancing its three brownfield natural gas plants, totaling 1.5 GW, with 1.1 GW progressing through Texas Energy Fund (TEF) due diligence and a 443 MW peaker under evaluation. In December 2024, the Public Utility Commission of Texas (PUCT) selected the 689 MW Cedar Bayou 5 CCGT project to advance to the next phase of diligence, marking the second NRG project chosen under the TEF process. A turbine is onsite at the Company's T.H. Wharton plant (also in TEF due diligence) and commercial operation is expected by summer 2026. These projects underscore NRG's commitment to delivering high-quality dispatchable generation to meet the growing energy needs of Texas consumers.

Segment Results

Table 3: Adjusted EBITDAa

($ in millions)

Three Months Ended

Twelve Months Ended

Segment

Texas

$

$

$

$

East

West/Services/Otherb

6

Vivint Smart Homec

Adjusted EBITDAd

$

$

$

$

a Adjusted EBITDA is a non-GAAP financial measure; see Appendix tables A-1 through A-6 for GAAP reconciliation of Adjusted EBITDA (by operating segment) to GAAP Net Income (by operating segment). Adjusted EBITDA excludes fair value adjustments related to derivatives

b Includes Corporate activities

c Vivint Smart Home acquired in March 2023. These figures presented exclude Vivint's results of operations during the period prior to the acquisition

d Adjusted EBITDA recast to exclude all impacts of amortization of capitalized contract costs related to fulfillment, now reflected in depreciation and amortization

Texas: Full year 2024 Adjusted EBITDA was $1,582 million, $110 million lower than the prior year. The decrease was primarily driven by the sale of NRG's equity interest in the STP power plant in 2023, mild weather, and the impact of extended planned preventative maintenance to ensure summer reliability. This was partially offset by strong operational performance and supply optimization during low power price periods.

3

East: Full year 2024 Adjusted EBITDA was $1,006 million, $226 million higher than prior year. This increase was primarily driven by higher retail power margins, increased customer counts, and favorable natural gas wholesale and retail gross margins.

West/Services/Other: Full year 2024 Adjusted EBITDA was $201 million, $144 million higher than prior year. This increase was primarily driven by higher retail power margins and spark spread expansion at Cottonwood, partially offset by the sale of Airtron in September 2024.

Vivint Smart Home: Full year Adjusted EBITDA was $1,000 million, $210 million higher than prior year. The increase reflects full year 2024 results compared to ten months of NRG's ownership in 2023. The remainder of the increase was primarily the result of growth in total subscribers and higher monthly recurring service margins.

Liquidity and Capital Resources

Table 4: Corporate Liquidity

(In millions)

Cash and Cash Equivalents

$

$

Restricted Cash

8

Total

$

$

Total credit facility availability

Total Liquidity, excluding collateral received

$

$

As of December 31, 2024, NRG's unrestricted cash was $1.0 billion, and $4.5 billion was available under the Company’s credit facilities. Total liquidity was $5.4 billion, which was $0.6 billion higher than December 31, 2023. This increase was due to specific initiatives to optimize the amount of collateral supporting NRG's market operations activity and a decrease in collateral postings.

Earnings Conference Call

On February 26, 2025, NRG will host a conference call at 9:00 a.m. Eastern (8:00 a.m. Central) to discuss these results. Investors, the news media and others may access the live webcast of the conference call and accompanying presentation materials through the investor relations website under “presentations and webcasts” on investors.nrg.com. The webcast will be archived on the site for those unable to listen in real-time.

About NRG

NRG Energy is a leading energy and home services company powered by people and our passion for a smarter, cleaner, and more connected future. A Fortune 500 company operating in the United States and Canada, NRG delivers innovative solutions that help people, organizations, and businesses achieve their goals while also advocating for competitive energy markets and customer choice. More information is available at www.nrg.com. Connect with NRG on Facebook and LinkedIn, and follow us on X, @nrgenergy.

Forward-Looking Statements

In addition to historical information, the information presented in this press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act. These statements involve estimates, expectations, projections, goals, assumptions, known and unknown risks and uncertainties and can typically be identified by terminology such as “may,” “should,” “could,” “objective,” “projection,” “forecast,” “goal,” “guidance,” “outlook,” “expect,” “intend,” “seek,” “plan,” “think,” “anticipate,” “estimate,” “predict,” “target,” “potential” or “continue” or the negative of these terms or other comparable terminology. Such forward-looking statements include, but are not limited to, statements about the Company’s future revenues, income, indebtedness, capital structure, plans, expectations, objectives, projected financial performance and/or business results and other future events, and views of economic and market conditions.

Although NRG believes that its expectations are reasonable, it can give no assurance that these expectations will prove to be correct, and actual results may vary materially. Factors that could cause actual results to differ materially from those contemplated herein include, among others, general economic conditions, hazards customary in the power industry, weather conditions and extreme weather events, competition in wholesale power, gas and smart home markets, the volatility of energy

4

and fuel prices, the volatility in demand for power and gas, failure of customers or counterparties to perform under contracts, changes in the wholesale power and gas markets, changes in government or market regulations, the condition of capital markets generally and NRG’s ability to access capital markets, NRG’s ability to execute its supply strategy, risks related to data privacy, cyberterrorism and inadequate cybersecurity, the loss of data, unanticipated outages at NRG’s generation facilities, operational and reputational risks related to the use of artificial intelligence and the adherence to developing laws and regulations related to the use thereof, NRG’s ability to achieve its net debt targets, adverse results in current and future litigation, complaints, product liability claims and/or adverse publicity, failure to identify, execute or successfully implement acquisitions or asset sales, risks of the smart home and security industry, including risks of and publicity surrounding the sales, subscriber origination and retention process, the impact of changes in consumer spending patterns, consumer preferences, geopolitical tensions, demographic trends, supply chain disruptions, NRG’s ability to implement value enhancing improvements to plant operations and company wide processes, NRG’s ability to achieve or maintain investment grade credit metrics, NRG’s ability to proceed with projects under development or the inability to complete the construction of such projects on schedule or within budget, the inability to maintain or create successful partnering relationships, NRG’s ability to operate its business efficiently, NRG’s ability to retain customers, the ability to successfully integrate businesses of acquired assets or companies, NRG’s ability to realize anticipated benefits of transactions (including expected cost savings and other synergies) or the risk that anticipated benefits may take longer to realize than expected, NRG’s ability to execute its capital allocation plan, and the other risks and uncertainties discussed in this release and in our Forms 10-K, 10-Q, and 8-K filed with or furnished to the SEC.

Achieving investment grade credit metrics is not an indication of or guarantee that the Company will receive investment grade credit ratings. Debt and share repurchases may be made from time to time subject to market conditions and other factors, including as permitted by United States securities laws. Furthermore, any common stock dividend is subject to available capital and market conditions.

NRG undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. The Adjusted EBITDA, cash provided by operating activities, Free Cash Flow before Growth, Adjusted Net Income, and Adjusted EPS guidance are estimates as of February 26, 2025. These estimates are based on assumptions NRG believed to be reasonable as of that date. NRG disclaims any current intention to update such guidance, except as required by law. The foregoing review of factors that could cause NRG’s actual results to differ materially from those contemplated in the forward-looking statements included in this press release should be considered in connection with information regarding risks and uncertainties that may affect NRG's future results included in NRG's filings with the Securities and Exchange Commission at www.sec.gov.

For a more detailed discussion of these factors, see the information under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in NRG’s most recent Annual Report on Form 10-K, and in subsequent SEC filings. NRG’s forward-looking statements speak only as of the date of this communication or as of the date they are made.

Contacts:

Media:

Investors:

Chevalier Gray

Brendan Mulhern

5

NRG ENERGY, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

For the Year Ended December 31,

(In millions, except per share amounts)

Revenue

Revenue

$

$

$

Operating Costs and Expenses

Cost of operations (excluding depreciation and amortization shown below)

Depreciation and amortization

Impairment losses

Selling, general and administrative costs (excluding amortization of customer acquisition costs of $204, $125 and $83, respectively, which are included in depreciation and amortization shown separately above)

Provision for credit losses

Acquisition-related transaction and integration costs

Total operating costs and expenses

Gain on sale of assets

Operating Income

Other Income/(Expense)

Equity in earnings of unconsolidated affiliates

6

Impairment losses on investments

(7)

—

Other income, net

(Loss)/Gain on debt extinguishment

—

Interest expense

Total other expense

Income/(Loss) Before Income Taxes

Income tax expense/(benefit)

Net Income/(Loss)

Less: Cumulative dividends attributable to Series A Preferred Stock

—

Net Income/(Loss) Available for Common Stockholders

$

$

$

Income/(Loss) Per Share

Weighted average number of common shares outstanding — basic

Income/(Loss) per Weighted Average Common Share — Basic

$

$

$

Weighted average number of common shares outstanding — diluted

Income/(Loss) per Weighted Average Common Share — Diluted

$

$

$

6

NRG ENERGY, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS)

For the Year Ended December 31,

(In millions)

Net Income/(Loss)

$

$

$

Other Comprehensive (Loss)/Income, net of tax

Foreign currency translation adjustments

9

Defined benefit plans

(4)

Other comprehensive (loss)/income

Comprehensive Income/(Loss)

$

$

$

7

NRG ENERGY, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

As of December 31,

(In millions)

ASSETS

Current Assets

Cash and cash equivalents

$

$

Funds deposited by counterparties

Restricted cash

8

Accounts receivable, net

Inventory

Derivative instruments

Cash collateral paid in support of energy risk management activities

Prepayments and other current assets

Total current assets

Property, plant and equipment, net

Other Assets

Equity investments in affiliates

Operating lease right-of-use assets, net

Goodwill

Customer relationships, net

Other intangible assets, net

Derivative instruments

Deferred income taxes

Other non-current assets

Total other assets

Total Assets

$

$

8

NRG ENERGY, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (Continued)

As of December 31,

(In millions, except share data)

LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities

Current portion of long-term debt and finance leases

$

$

Current portion of operating lease liabilities

Accounts payable

Derivative instruments

Cash collateral received in support of energy risk management activities

Deferred revenue current

Accrued expenses and other current liabilities

Total current liabilities

Other Liabilities

Long-term debt and finance leases

Non-current operating lease liabilities

Derivative instruments

Deferred income taxes

Deferred revenue non-current

Other non-current liabilities

Total other liabilities

Total Liabilities

Commitments and Contingencies

Stockholders' Equity

Preferred stock; 10,000,000 shares authorized; 650,000 Series A shares issued and outstanding at December 31, 2024 and 2023 (aggregate liquidation preference $650)

Common stock; $0.01 par value; 500,000,000 shares authorized; 205,064,058 and 267,330,470 shares issued; and 198,604,003 and 208,130,950 shares outstanding at December 31, 2024 and 2023, respectively

2

3

Additional paid-in capital

Retained earnings

Treasury stock, at cost; 6,460,055 and 59,199,520 shares at December 31, 2024 and 2023, respectively

Accumulated other comprehensive loss

Total Stockholders' Equity

Total Liabilities and Stockholders' Equity

$

$

9

NRG ENERGY, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Year Ended December 31,

(In millions)

Cash Flows from Operating Activities

Net Income/(Loss)

$

$

$

Adjustments to reconcile net income to net cash provided by operating activities:

Equity in earnings of unconsolidated affiliates, net of distributions

(6)

7

Depreciation of property, plant and equipment and amortization of customer relationships and other intangible assets

Amortization of capitalized contract costs

Accretion of asset retirement obligations

Provision for credit losses

Amortization of nuclear fuel

—

Amortization of financing costs and debt discounts

Loss/(Gain) on debt extinguishment

—

Amortization of in-the-money contracts and emissions allowances

Amortization of unearned equity compensation

Net gain on sale of assets and disposal of assets

Impairment losses

Changes in derivative instruments

Changes in current and deferred income taxes and liability for uncertain tax benefits

Changes in collateral deposits in support of risk management activities

Changes in nuclear decommissioning trust liability

—

—

9

Uplift securitization proceeds received from ERCOT

—

—

Cash (used)/provided by changes in other working capital:

Accounts receivable - trade

Inventory

Prepayments and other current assets

Accounts payable

Accrued expenses and other current liabilities

Other assets and liabilities

Cash provided/(used) by operating activities

$

$

$

Cash Flows from Investing Activities

Payments for acquisitions of businesses and assets, net of cash acquired

$

$

$

Capital expenditures

Proceeds from sale of assets, net of cash disposed

Net purchases of emissions allowances

(6)

Proceeds from insurance recoveries for property, plant and equipment, net

3

—

Investments in nuclear decommissioning trust fund securities

—

Proceeds from sales of nuclear decommissioning trust fund securities

—

Cash used by investing activities

$

$

$

For the Year Ended December 31,

(In millions)

Cash Flows from Financing Activities

Proceeds from issuance of preferred stock, net of fees

$

—

$

$

—

Payments for share repurchase activity and excise tax(a)

Equivalent shares purchased in lieu of tax withholdings

(6)

Payments of dividends to preferred and common stockholders

Proceeds from issuance of long-term debt

—

Payments for current and long-term debt

(5)

Payments for debt extinguishment costs

—

—

Payments of debt issuance costs

(9)

Net (payments)/receipts from settlement of acquired derivatives that include financing elements

(3)

Proceeds from credit facilities

—

Repayments to credit facilities

—

Cash (used)/provided by financing activities

$

$

$

Effect of exchange rate changes on cash and cash equivalents

(3)

2

(3)

Net (Decrease)/Increase in Cash and Cash Equivalents, Funds Deposited by Counterparties and Restricted Cash

Cash and Cash Equivalents, Funds Deposited by Counterparties and Restricted Cash at Beginning of Period

Cash and Cash Equivalents, Funds Deposited by Counterparties and Restricted Cash at End of Period

$

$

$

(a)Includes excise tax paid of $10 million during the year ended December 31, 2024

Appendix Table A-1: Fourth Quarter 2024 Adjusted EBITDA Reconciliation by Operating Segment and Consolidated Adjusted EPS Reconciliation

The following table summarizes the calculation of Adjusted EBITDA, Adjusted Net Income and Adjusted EPS and provides a reconciliation from Net Income/(Loss)1:

($ in millions, except per share amounts)

Texas

East

West/

Services/

Other

Vivint Smart Home

Corp/Elim2

Total

Net Income/(Loss)

$

$

$

7

$

$

$

Plus:

Interest expense, net

—

—

—

—

Income tax expense

—

—

—

—

Loss on debt extinguishment

—

—

—

—

Depreciation and amortization1

ARO expense

3

2

—

—

—

5

Contract and emission credit amortization, net

2

4

4

—

—

EBITDA

Stock-based compensation

5

1

1

—

Adjustment to reflect NRG share of adjusted EBITDA in unconsolidated affiliates

—

—

(3)

—

—

(3)

Acquisition and divestiture integration and transaction costs

—

—

—

2

6

8

Cost to achieve

—

—

—

—

5

5

Deactivation costs

—

7

—

—

—

7

Loss on sale of assets3

—

—

4

—

—

4

Other and non-recurring charges4

(9)

(3)

(1)

3

Impairments

7

—

—

—

Mark-to-market (MtM) (gains) on economic hedges5

—

—

Adjusted EBITDA

$

$

$

$

$

$

Adjusted interest expense, net6

Depreciation and amortization

Adjusted Income before income taxes

Adjusted income tax expense7

Adjusted Net Income before Preferred Stock dividends

Cumulative dividends attributable to Series A Preferred Stock

Adjusted Net Income8

Weighted average number of common shares outstanding - basic

Adjusted EPS

$

1 Adjusted EBITDA recast to exclude all impacts of amortization of capitalized contract costs related to fulfillment, now reflected in depreciation and amortization

2 Beginning in the fourth quarter of 2024, Corporate now includes interest expense related to its consolidated debt financing activities and income tax expense related to its consolidated U.S. federal, foreign and state income taxes conforming to the way the Company internally manages and monitors the business. Prior periods amounts have been recast for comparative purposes to reflect this change

3 Excludes sale of land not associated with a generating asset

4 Includes reserves for legal matters, offset by one-time gain from change in benefits in 2024

5 Gain of $(489) million was primarily driven by unrealized non-cash mark-to-market gains on economic hedges in the East due to large movements in natural gas and power prices

6 Excludes mark-to-market gain on interest hedges of $34 million

7 Income tax calculated using Adjusted effective tax rate (ETR) on Adjusted Income before income taxes. Adjusted ETR includes impact of NRG’s tax credits, consisting of incentive tax credit in connection with renewable projects and production tax credits for carbon recapture for pre-IRA periods, as well as non-recurring tax items like movements in valuation allowances

8 Adjusted Net Income as shown here is 'Adjusted Net Income available for common stockholders'

Fourth Quarter 2024 condensed financial information by Operating Segment:

($ in millions)

Texas

East

West/

Services/

Other

Vivint Smart Home

Corp/Elim

Total

Revenue1

Cost of fuel, purchased energy and other cost of sales2

(8)

Economic gross margin

Operations & maintenance and other cost of operations3

(6)

Selling, marketing, general and administrative4

1

Provision for credit losses

7

9

—

Other

(2)

(3)

2

1

4

2

Adjusted EBITDA

$

$

$

$

$

$

1 Excludes MtM loss of $35 million and contract amortization of $4 million

2 Includes TDSP expense, capacity and emission credits

3 Excludes deactivation costs of $7 million, ARO expense of $5 million, stock-based compensation of $2 million and other and non-recurring charges of $(5) million

4 Excludes stock-based compensation of $18 million, other and non-recurring charges of $9 million and cost to achieve of $5 million

The following table reconciles the Fourth Quarter 2024 condensed financial information to Adjusted EBITDA:

($ in millions)

Condensed financial information

Interest, tax, depr., amort.

MtM

Deactivation

Other adj.2

Adjusted EBITDA

Revenue

$

$

4

$

$

—

$

—

$

Cost of operations (excluding depreciation and amortization shown below)1

(6)

—

—

Depreciation and Amortization

—

—

—

—

Gross margin

—

—

Operations & maintenance and other cost of operations

—

—

(7)

(2)

Selling, marketing, general & administrative

—

—

—

Provision for credit losses

—

—

—

—

Other

—

—

2

Net Income/(Loss)

$

$

$

$

7

$

$

1 Excludes operations & maintenance and other cost of operations of $499 million

2 Other adj. includes loss on debt extinguishment $122 million, impairments of $28 million, stock-based compensation of $20 million, acquisition and divestiture integration and transaction costs of $8 million, cost to achieve of $5 million, ARO expense of $5 million, loss on sale of assets $4 million, other and non-recurring charges of $3 million and NRG share of adjusted EBITDA in unconsolidated affiliates of $(3) million

Appendix Table A-2: Fourth Quarter 2023 Adjusted EBITDA Reconciliation by Operating Segment and Consolidated Adjusted EPS Reconciliation

The following table summarizes the calculation of Adjusted EBITDA, Adjusted Net Income and Adjusted EPS and provides a reconciliation from Net Income/(Loss)1:

($ in millions, except per share amounts)

Texas

East

West/

Services/

Other

Vivint Smart Home

Corp/Elim2

Total

Net Income/(Loss)

$

$

$

$

$

$

Plus:

Interest expense, net

—

—

—

—

Income tax expense

—

—

—

—

(Gain) on debt extinguishment

—

—

—

—

Depreciation and amortization1

9

ARO Expense

8

5

—

—

—

Contract and emission credit amortization, net

2

4

—

—

EBITDA

Stock-based compensation

(2)

(1)

(1)

—

Adjustment to reflect NRG share of adjusted EBITDA in unconsolidated affiliates

—

—

4

—

—

4

Acquisition and divestiture integration and transaction costs

—

—

—

2

6

8

Cost to achieve

—

—

—

—

Deactivation costs

—

3

—

—

(Gain) on sale of assets3

—

—

—

Other and non-recurring charges4

—

1

Impairments

2

4

—

—

Mark-to-market (MtM) loss on economic hedges5

—

—

Adjusted EBITDA

$

$

$

$

$

(8)

$

Adjusted interest expense, net6

Depreciation and amortization

Adjusted Income before income taxes

Adjusted income tax expense7

Adjusted Net Income before Preferred Stock dividends

Cumulative dividends attributable to Series A Preferred Stock

Adjusted Net Income8

Weighted average number of common shares outstanding - basic

Adjusted EPS

$

1 Adjusted EBITDA recast to exclude all impacts of amortization of capitalized contract costs related to fulfillment, now reflected in depreciation and amortization

2 Beginning in the fourth quarter of 2024, Corporate now includes interest expense related to its consolidated debt financing activities and income tax expense related to its consolidated U.S. federal, foreign and state income taxes conforming to the way the Company internally manages and monitors the business. Prior periods amounts have been recast for comparative purposes to reflect this change

3 Excludes sale of land not associated with a generating asset

4 Includes $(68) million of property insurance proceeds. For the three months ended December 31, 2023, cash proceeds were $67 million

5 Loss of $930 million was primarily driven by unrealized non-cash mark-to-market losses on economic hedges in the East due to large movements in natural gas and power prices

6 Excludes mark-to-market loss on interest hedges of $28 million

7 Income tax calculated using Adjusted ETR on Adjusted Income before income taxes. Adjusted ETR includes impact of NRG’s tax credits, consisting of incentive tax credit in connection with renewable projects and production tax credits for carbon recapture for pre-IRA periods, as well as non-recurring tax items like movements in valuation allowances

8 Adjusted Net Income as shown here is 'Adjusted Net Income available for common stockholders'

Fourth Quarter 2023 condensed financial information by Operating Segment:

($ in millions)

Texas

East

West/

Services/

Other

Vivint Smart Home

Corp/Elim

Total

Revenue1

(4)

Cost of fuel, purchased energy and other cost of sales2

(3)

Economic gross margin

(1)

Operations & maintenance and other cost of operations3

(2)

Selling, marketing, general & administrative4

5

Provision for credit losses

6

8

—

Other

—

(8)

1

4

Adjusted EBITDA

$

$

$

$

$

(8)

$

1 Excludes MtM gain of $(48) million and contract amortization of $8 million

2 Includes TDSP expense, capacity and emission credits

3 Excludes deactivation costs of $18 million, ARO expense of $13 million, stock-based compensation of $2 million and other and non-recurring charges of $(68) million

4 Excludes other and non-recurring charges of $19 million, cost to achieve of $14 million, stock-based compensation of $11 million and acquisition and divestiture integration and transaction costs of $2 million

The following table reconciles the Fourth Quarter 2023 condensed financial information to Adjusted EBITDA:

($ in millions)

Condensed financial information

Interest, tax, depr., amort.

MtM

Deactivation

Other adj.2

Adjusted EBITDA

Revenue

$

$

8

$

$

—

$

—

$

Cost of operations (excluding depreciation and amortization shown below)1

—

—

Depreciation and amortization

—

—

—

—

Gross margin

—

—

Operations & maintenance and other cost of operations

—

—

Selling, marketing, general & administrative

—

—

—

Provision for credit losses

—

—

—

—

Other

—

—

Net Income/(Loss)

$

$

$

$

$

$

1 Excludes operations & maintenance and other cost of operations of $404 million

2 Other adj. includes impairments of $128 million, cost to achieve of $14 million, stock-based compensation of $13 million, ARO expense of $13 million, acquisition and divestiture integration and transaction costs of $8 million, NRG share of adjusted EBITDA in unconsolidated affiliates of $4 million, other and non-recurring charges of $(36) million, gain on debt extinguishment $(109) million and gain on sale of assets of $(1,350) million

Appendix Table A-3: Fourth Quarter 2024 and 2023 Adjusted Net Income and Adjusted EPS Reconciliations

The following table summarizes the calculation of Adjusted Net Income and Adjusted EPS and provides a reconciliation from Net Income1:

Three Months Ended

($ in millions, except per share amounts)

Earnings per Share, Basic2

Earnings per Share, Diluted2

Earnings per Share, Basic2

Earnings per Share, Diluted2

Net Income Available for Common Stockholders

$

$

$

$

$

$

Plus:

Cumulative dividends attributable to Series A Preferred Stock

Loss/(gain) on debt extinguishment

ARO expense

5

Contract and emission credit amortization, net

Stock-based compensation

Adjustment to reflect NRG share of adjusted EBITDA in unconsolidated affiliates

(3)

4

Acquisition and divestiture integration and transaction costs

8

8

Cost to achieve

5

Deactivation costs

7

Loss/(gain) on sale of assets3

4

Other and non-recurring charges4

3

Impairments

Mark to market (MtM) (gain)/loss on economic hedges5

Mark-to-market (MtM) (gain)/loss on interest hedges

Income tax expense6

Adjusted Income before income taxes

$

$

$

$

Adjusted income tax expense7

Adjusted Net Income before Preferred Stock dividends

$

$

$

$

Cumulative dividends attributable to Series A Preferred Stock

Adjusted Net Income8

$

$

$

$

$

$

1 Items may not sum due to rounding

2 Earnings per share amounts are based on weighted average number of common shares outstanding - basic of 202 million and 223 million for the three months ended December 31, 2024 and 2023, respectively, and on weighted average number of common shares outstanding - diluted of 208 million and 227 million for the three months ended December 31, 2024 and 2023, respectively

3 Excludes sale of land not associated with a generating asset

4 2024 includes reserves for legal matters, offset by one-time gain from change in benefits; 2023 includes $(68) million of property insurance proceeds

5 2024 gain of $(489) million was primarily driven by unrealized non-cash mark-to-market gains on economic hedges in the East due to large movements in natural gas and power prices; 2023 loss of $930 million was primarily driven by unrealized non-cash mark-to-market losses on economic hedges in the East due to large movements in natural gas and power prices

6 Represents GAAP income tax expense

7 Income tax calculated using Adjusted ETR on Adjusted Income before income taxes. Adjusted ETR includes impact of NRG’s tax credits, consisting of incentive tax credit in connection with renewable projects and production tax credits for carbon recapture for pre-IRA periods, as well as non-recurring tax items like movements in valuation allowances. Other adjustments are shown on pre-tax basis

8 Adjusted Net Income as shown here is 'Adjusted Net Income available for common stockholders'

Appendix Table A-4: Full Year 2024 Adjusted EBITDA Reconciliation by Operating Segment and Consolidated Adjusted EPS Reconciliation

The following table summarizes the calculation of Adjusted EBITDA, Adjusted Net Income and Adjusted EPS and provides a reconciliation from Net Income/(Loss)1:

($ in millions, except per share amounts)

Texas

East

West/

Services/

Other

Vivint Smart Home

Corp/Elim2

Total

Net Income/(Loss)

$

$

$

$

$

$

Plus:

Interest expense, net

—

—

—

—

Income tax expense

—

—

—

—

Loss on debt extinguishment

—

—

—

—

Depreciation and amortization1

ARO expense

1

—

—

Contract and emission credit amortization, net

9

—

—

EBITDA

Stock-based compensation3

5

—

Acquisition and divestiture integration and transaction costs3

—

—

—

Cost to achieve3

—

—

—

—

Deactivation costs

—

2

—

—

Loss/(gain) on sale of assets4

4

—

—

—

Other and non-recurring charges5

—

9

(9)

Impairments

7

—

—

—

Mark-to-market (MtM) loss/(gain) on economic hedges6

—

—

Adjusted EBITDA

$

$

$

$

$

$

Adjusted interest expense, net7

Depreciation and amortization

Adjusted Income before income taxes

Adjusted income tax expense8

Adjusted Net Income before Preferred Stock dividends

Cumulative dividends attributable to Series A Preferred Stock

Adjusted Net Income9

Weighted average number of common shares outstanding - basic

Adjusted EPS

$

1 Adjusted EBITDA recast to exclude all impacts of amortization of capitalized contract costs related to fulfillment, now reflected in depreciation and amortization

2 Beginning in the fourth quarter of 2024, Corporate now includes interest expense related to its consolidated debt financing activities and income tax expense related to its consolidated U.S. federal, foreign and state income taxes conforming to the way the Company internally manages and monitors the business. Prior periods amounts have been recast for comparative purposes to reflect this change

3 Stock-based compensation of $2 million is reflected in cost to achieve and $1 million is reflected in acquisition and divestiture integration and transaction

costs

4 Excludes sale of land not associated with a generating asset

5 Includes reserves for legal matters, offset by one-time gain from change in benefits in 2024

6 Gain of $(206) million was primarily driven by roll-off of 2024 positions as well as gains on economic hedges in the East due to large movements in natural gas and power prices, partially offset by losses on economic hedges in Texas and West due to movements in power prices

7 Excludes mark-to-market gain on interest hedges of $3 million

8 Income tax calculated using Adjusted ETR on Adjusted Income before income taxes. Adjusted ETR includes impact of NRG’s tax credits, consisting of incentive tax credit in connection with renewable projects and production tax credits for carbon recapture for pre-IRA periods, as well as non-recurring tax items like movements in valuation allowances

9Adjusted Net Income as shown here is 'Adjusted Net Income available for common stockholders'

Full Year 2024 condensed financial information by Operating Segment:

($ in millions)

Texas

East

West/

Services/

Other

Vivint Smart Home

Corp/Elim

Total

Revenue1

Cost of fuel, purchased energy and other cost of sales2

Economic gross margin

Operations & maintenance and other cost of operations3

(3)

Selling, marketing, general and administrative4

6

Provision for credit losses5

—

Other

—

(1)

1

Adjusted EBITDA

$

$

$

$

$

$

1 Excludes MtM loss of $3 million and contract amortization of $29 million

2 Includes TDSP expense, capacity and emission credits

3 Excludes ARO expense of $34 million, deactivation costs of $22 million, stock-based compensation of $9 million and other and non-recurring charges of $5 million

4 Excludes stock-based compensation of $90 million, cost to achieve of $28 million, other and non-recurring charges of $10 million and acquisition and divestiture integration and transaction costs of $5 million

5 Excludes $2 million of bad debt related to integration

The following table reconciles the Full Year 2024 condensed financial information to Adjusted EBITDA:

($ in millions)

Condensed financial information

Interest, tax, depr., amort.

MtM

Deactivation

Other adj.2

Adjusted EBITDA

Revenue

$

$

$

3

$

—

$

—

$

Cost of operations (excluding depreciation and amortization shown below)1

—

—

Depreciation and amortization

—

—

—

—

Gross margin

—

—

Operations & maintenance and other cost of operations

—

—

Selling, marketing, general & administrative

—

—

—

Provision for credit losses

—

—

—

(2)

Other

—

—

Net Income/(Loss)

$

$

$

$

$

$

1 Excludes operations & maintenance and other cost of operations of $1,999 million

2 Other adj. includes loss on debt extinguishment of $382 million, stock-based compensation of $99 million, impairments of $43 million, acquisition and divestiture integration and transaction costs of $35 million, ARO expenses of $34 million, cost to achieve of $28 million, other and non-recurring charges of $28 million and gain on sale of assets $(200) million

Appendix Table A-5: Full Year 2023 Adjusted EBITDA Reconciliation by Operating Segment and Consolidated Adjusted EPS Reconciliation

The following table summarizes the calculation of Adjusted EBITDA, Adjusted Net Income and Adjusted EPS and provides a reconciliation from Net Income/(Loss)1:

($ in millions, except per share amounts)

Texas

East

West/

Services/

Other

Vivint Smart Home2

Corp/Elim3