With a combined revenue of $21 trillion and $2.1 trillion in profits, the 2026 Fortune 500 is the definitive list of America's largest companies.

Fortune 500

Almost $20 trillion in revenue—and a record-breaking $1.87 trillion in profits. Introducing the 2025 Fortune 500, the definitive list of the biggest companies in America.

The 300 companies on this year’s list brought in over $12.6 trillion in revenue for the latest 12 months, with the median revenue figure at $22 billion.

America's Most Innovative Companies

Energy sector dominated this year for the first time since 2008, with 28 companies featured on the list.

100 Fastest-Growing Companies

Industries included in the sector are mining, oil and gas exploration and services, pipelines, refining, and utilities.

Fortune Sector Leaders: Energy

The Fortune 500, in its 70th year in 2024, ranks the biggest U.S. companies by revenue.

The corporations on our annual list of the world’s largest companies delivered a record $41 trillion in aggregate revenues.

Fortune Global 500

The Fortune 500, in its 69th year in 2023, ranks the biggest U.S. companies by revenue.

This year’s Fortune 500 marks the 68th running of the list.

This year’s group delivered stellar revenue and profit growth, but it underperformed the broader stock market.

This year’s Fortune 500 marks the 67th running of the list.

F500-2021-333-NRG Energy

The energy company produces and distributes electricity and other utility services to a variety of clients, both residential and commercial, across the country. In May, NRG Energy announced it relocated its headquarters from New Jersey to Houston, and the city has committed to purchasing 100% renewable energy.

This year's Fortune 500 marks the 66th running of the list.

F500 2020 324 NRG Energy

With headquarters in both Princeton, N.J. and Houston, this energy company serves about 3.7 million residential, small business, commercial, and industrial customers.

This year's Fortune 500 marks the 65th running of the list.

This year's Fortune 500 marks the 64th running of the list.

This year's Fortune 500 marks the 63rd running of the list.

This year's Fortune 500 marks the 62nd running of the list.

Business insiders have spoken: Asked which companies they most admire, more than 4,100 executives, directors, and analysts chose these top 50 All-Stars.

World's Most Admired Companies

This year's Fortune 500 marks the 61st running of the list. Wal-Mart claims the top spot again. See who made the list.

Wal-Mart stayed on top as its sales crept closer to half-a-trillion dollars. Apple moved into the top five. And UnitedHealth Group continued its steady climb. 

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NRG Energy has grown into a top power, electricity, and smart home corporation in Texas, the Northeast, the Midwest, and parts of California. With headquarters in Houston, NRG focuses on power generation from natural gas and coal, but the gas side of the business is rapidly growing. In May, NRG agreed to pay $10 billion for 18 natural-gas-fired power plants from LS Power, not including debt, in a move designed to prepare NRG for a domestic power market that’s set to soar. NRG also is focusing more on smart home and security offerings since acquiring Vivint Smart Home in 2023, rather than just selling retail electricity.

Q2 2026

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Q3 2024

NRG Energy (NRG): Company Profile, Stock Price, News, Rankings

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NRG Energy

nrg energy

Today, and thank you for standing by. Welcome to the NRG Energy Inc Third Quarter 2025 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising you hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Brendan Mulhern, Head of Investor Relations. Please go ahead.

Thank you. Good morning and welcome to NRG Energy's Third Quarter 2025 Earnings Call. This morning's call is being broadcast live over the phone and via webcast. The webcast, presentation, and earnings release can be located in the investor section of our website at www.nrg.com under Presentations and Webcast. Please note that today's discussion may contain forward-looking statements which are based upon assumptions that we believe to be reasonable as of this date. Actual results may differ materially. We urge everyone to review the Safe Harbor in today's presentation as well as the risk factors in our SEC filings. We undertake no obligation to update these statements as a result of future events except as required by law. In addition, we will refer to both GAAP and non-GAAP financial measures.

For information regarding our non-GAAP financial measures and reconciliations to the most directly comparable GAAP measures, please refer to today's presentation and earnings release. With that, I will now turn it over to Larry Coben, NRG's Chair, President, and Chief Executive Officer.

Thank you, Brendan. Good morning, everyone, and thank you for your continued interest in NRG. I'm joined today by Bruce Chung, our Chief Financial Officer, and other members of our management team are also on the line and available to answer questions. Let's start with the key messages on slide four. Strong performance across all areas of the business led us to raise 2025 financial guidance by $100 million in late September. This is the third consecutive year we have increased our full-year outlook, and today we are reaffirming that higher range. We are also introducing 2026 guidance that aligns with our long-term growth targets. This represents NRG's standalone outlook and excludes any contribution from the LS Power acquisition. We will provide updated guidance that includes LS Power around the time of closing. We expanded our data center power agreements this quarter, bringing total contracted capacity to 445 MW.

We also rapidly grew our pipeline of potential projects under joint development and letters of intent to 5.4 GW. Together, these actions build on the agreement announced in August and reflect rapidly growing momentum and validation of our data center strategy. The LS Power acquisition remains on track. Financings were executed in September on favorable terms. All regulatory filings have been submitted, and we expect to close in the first quarter of 2026. Turning to slide five. Adjusted EPS for the third quarter was 32% higher than the same period last year, and adjusted EBITDA reached the highest quarterly level in company history. I'd like to pause to congratulate all 18,000 of our employees for that achievement. Our results reflect strong performance across both energy and smart home. In energy, supply optimization, and disciplined commercial execution drove margin improvement across both our home and C&I businesses.

In smart home, growth was supported by expanding our customer base, record retention, and continued momentum in our home virtual power plant initiative. We also delivered top decile safety performance and completed the loan agreement for our second Texas Energy Fund project. Year-to-date, adjusted EPS is 36% higher than last year, reflecting strong performance across all parts of the business as well as continued cost discipline. These results keep us firmly on track to achieve our raised full-year 2025 guidance ranges. On the right side of the slide, we are introducing 2026 guidance on a standalone basis. This serves as an interim view ahead of a full update after the LS Power acquisition closes, when we will provide guidance for the combined company. Moving to slide six for an update on market conditions. ERCOT experienced a mild summer with moderate pricing and strong growth in overall power use.

Total consumption across Texas has increased nearly 30% over the past five years, driven by residential, commercial, and industrial demand as electrification and onshoring of manufacturing accelerate. Data center development usage remains early, with ramp schedules expected to add meaningful capacity over the next several years. Looking ahead, power demand is projected to outpace new supply, keeping the market structurally tight and reinforcing the need for reliable, dispatchable generation. Policymakers are responding through initiatives such as Senate Bill 6 in Texas and similar efforts in other regions focused on affordability, additionality, and reliability. We are encouraged by the focus and progress being made to strengthen ERCOT and other competitive markets across the country. In this environment, NRG is expanding its portfolio of reliable and flexible capacity.

Through the LS Power and Rockland acquisitions, the Texas Energy Fund projects, and our home Virtual Power Plant, we are adding 15 GW of natural gas and 7 GW of Virtual Power Plant capacity. We also see about 6 GW of additional opportunities through the GE Vernova partnership and our final TEF project that is still under review. Together, these actions strengthen our platform and position NRG to meet rising customer demand and support large load growth, including data centers across ERCOT, PJM, and other key markets. Turning to slide seven, we expanded our data center customer portfolio to 150 megawatts of new premium long-term power agreements, bringing total contracted capacity to 445 MW across ERCOT and PJM. This builds on the framework announced last quarter with the same customer.

These sites, located in Maryland and Illinois, support edge data center development with access to high-capacity fiber and proximity to major U.S. cities. These projects will be built in PJM with operations beginning in 2028 and ramping through 2032. This agreement was signed above the midpoint of our prior $70-$90 per MWh target range. Given continued strength in customer demand and higher forward power curves, we are raising our target for new long-term data center agreements to above $80 per MWh. This reflects sustained pricing improvement and NRG's leadership in providing reliable, long-term power solutions for large load customers. We are advancing numerous additional opportunities, including up to 5.4 GW of new capacity for data centers through 2032 under our GE Vernova and Kiewit partnership, supporting the principle of additionality. Since last quarter, signed letters of intent have increased 35%, underscoring customer engagement from multiple hyperscalers and data center developers, as well as growing demand for new development. We also see several additional gigawatts of potential projects across our broader pipeline. As markets evolve toward bring-your-own-generation models, NRG is leading the next phase of data center growth. Turning to slide eight, the LS Power acquisition remains firmly on track for a first quarter 2026 close. It strengthens our platform, broadens our earnings base, and extends our reach across key competitive markets. It reinforces our position as one of the largest competitive generators in the country and increases our leverage to long-term demand growth. At announcement, the acquisition was immediately accretive across all key metrics, reflecting portfolio quality and an attractive purchase multiple.

We also unveiled a 14% EPS CAGR through 2029, which does not, I repeat, does not include any contribution from data centers and reflects pricing assumptions that are below current market levels. These factors, along with other upside opportunities, underscore the significant potential ahead. Since announcement, incremental benefits, including 100% bonus depreciation, have further enhanced the economics. All required filings have been submitted, and financing was completed on terms better than originally projected. The transaction positions NRG for stronger long-term growth, greater scale, and enhanced value creation as we bring the two platforms together. With that, I'll turn it over to Bruce for the financial review.

Thank you, Larry. Beginning with slide 10, NRG delivered strong financial and operational performance in the third quarter with $2.78 in adjusted earnings per share and $1.205 billion in adjusted EBITDA, representing a 32% and 14% increase from the same quarter of 2024, respectively. Adjusted net income was $537 million, and free cash flow before growth was $828 million. Through the first three quarters of 2025, NRG delivered $7.17 of adjusted earnings per share and over $3.2 billion of adjusted EBITDA, a year-over-year increase of 36% and 12%, respectively. Our exceptional quarterly and year-to-date financial performance reflects continued execution in all of our businesses, driven primarily by a mix of expanded margins, favorable weather, and excellent commercial and operational execution. Our Texas segment delivered third quarter and year-to-date adjusted EBITDA of $807 million and $1.618 billion, respectively, representing an improvement of 38% and 29% from the same period in 2024.

These results were driven by margin expansion across our operations in the region, with lower realized supply costs and excellent optimization despite low summer volatility. The east segment contributed adjusted EBITDA of $107 million in the third quarter and $680 million through the first three quarters of 2025. These results reflect a modest decline from the same period of 2024, primarily driven by the net impact of higher supply costs throughout the region, partially offset by increased capacity revenues at our plants and favorable weather in the first quarter, which benefited our natural gas business. Our west services other segment had adjusted EBITDA of $19 million in the third quarter and $139 million through the first three quarters of 2025.

The segment realized higher retail power margins, which were offset by the absence of earnings from the sale of our Airtron business in 2024 and the lease expiration at the Cottonwood facility in May 2025 when compared to the same periods of the prior year. Our smart home business posted another impressive quarter and executed brilliantly through the key summer selling season, achieving adjusted EBITDA of $272 million in the third quarter and $803 million through the first three quarters of 2025. The segment continues to see record new customer adds and retention rates, as well as expanded net service margins. Our consolidated free cash flow before growth was $828 million for the quarter and $2.035 billion through the first three quarters of 2025. Year-to-date free cash flow before growth exceeded the same period in 2024 by $597 million, or 42%.

The year-over-year increase is primarily driven by the higher year-to-date adjusted EBITDA, favorable working capital timing, and receipt of the remaining insurance proceeds from our Parish Unit 8 claims. We expect some of the year-over-year favorability to moderate as working capital timing normalizes in the fourth quarter and as we continue to invest in our plants through our scheduled maintenance program. Looking to the remainder of 2025, we are reaffirming the increased financial guidance we announced last month, with ranges of $7.55-$8.15 for adjusted EPS, $3.875 billion-$4.025 billion for adjusted EBITDA, and $2.1 billion-$2.25 billion for free cash flow before growth. Moving to slide 11 for updates to our capital allocation for the remainder of 2025.

This has been updated to reflect the new midpoint of our raised free cash flow before growth guidance target, setting the total capital available for allocation in 2025 at $2.7 billion. Note that this slide excludes proceeds received from the $4.9 billion of new debt raised in October, most of which will be allocated to fund the cash portion of the pending LS Power transaction. The few other updates from what I shared in our second quarter call are denoted in light blue. Starting with an update to liability management, the $52 million increase primarily reflects transaction costs and financing fees associated with the LS Power transaction. Integration costs increased by $20 million due to a shift in spend from 2024 to 2025. The net total remained largely consistent with our communicated expectation between the two years.

We remain on track to execute the full $1.3 billion in share repurchases slated in 2025. Through October 31st, we have executed $1.084 billion in share repurchases, or nearly 85% of our planned annual total, at a weighted average price of $125.35, and expect to complete the full amount of share repurchases by the end of the year. Other related activities increased due to higher tax withholdings related to equity compensation, resulting from the increase in our share price. The increase in the revenue synergy growth plan reflects the strong customer growth our smart home segment has delivered through the year. Customer growth for the business was 9% year-over-year, well surpassing the targeted 5%-6% net customer growth embedded in our growth plan. On other investments, we are showing a net $30 million inflow of capital related to our Texas New Build program.

As you may recall, the stipulated capital structure for projects under the Texas Energy Fund program is 60/40 debt to equity. In order to get our TEF projects to that target capital structure, the initial disbursement under the loan took into account previously spent development costs. Given that catch-up mechanism under the loan, the disbursements we received in 2025 exceeded the amount of capital we expect to spend on the projects, therefore resulting in a net inflow of capital for the year. Finally, we are on track to finish the year with $158 million of unallocated capital, which we currently plan to roll over into 2026 and deploy as part of our 2026 capital allocation plan.

Turning to the next slide, we are initiating our 2026 NRG standalone financial guidance at ranges of $3.925 billion-$4.175 billion for adjusted EBITDA, representing a midpoint of $4.05 billion, and free cash flow before growth of $1.975 billion-$2.225 billion, representing a midpoint of $2.1 billion. We are not providing standalone EPS guidance, as we acknowledge that EPS will change materially with the closing of the LS Power transaction due to associated accounting adjustments, pro forma capital allocation, and other matters impacting any per-share financial metrics. As you can see on the slide, we have included the same adjusted EBITDA and free cash flow before growth for the acquisition, which we provided when we originally announced the transaction in May. This, combined with the 2026 NRG standalone guidance that we are initiating today, should remind people of the pro forma company's earnings profile.

We will provide an updated pro forma view once the transaction is closed, which will include updates to items like energy and capacity prices, accelerated depreciation benefits, and pro forma capital allocation, among others. On the bottom of the page, we have provided walks from the midpoint of our original 2025 guidance to the midpoint of our new 2026 guidance on a standalone NRG basis. For adjusted EBITDA, the net $200 million increase year-over-year is primarily driven by the addition of the Rockland assets acquired earlier in the year, the impact of higher power pricing in our Texas segment, and the continued execution of our existing $750 million growth plan.

The impact of higher power pricing in Texas that we are showing is consistent with the sensitivities we have provided in our previous earnings materials and reflects an increase in around-the-clock pricing from the $47 we previously used to $53 per MWh, which reflects Texas pricing at the end of July. The sum total of these year-over-year increases is slightly offset by other minor drivers, such as regulatory developments negatively impacting the Maryland and New York competitive retail markets and tariff impacts on our businesses. On free cash flow before growth, we expect strong year-over-year growth from core operations amounting to $145 million, comprised of the previously discussed EBITDA growth, partially offset by the continued investment in our generation fleet. After taking into account higher cash interest and taxes, we forecast free cash flow before growth to be flat year-over-year.

The higher cash interest is largely driven by refinancing of very low-cost debt that was issued when the Fed funds rate hovered near 0%. The increase in cash taxes primarily relates to fewer federal tax credits available to offset income than in prior years. Just to reiterate, we will provide a more detailed update on pro forma financial metrics once we close the acquisition. I look forward to sharing that update with you soon. Moving to slide 13 for a brief discussion on 2026 NRG standalone capital allocation. The key takeaway here is that we remain committed to our return of capital program through share purchases of $1 billion and our planned 7%-9% annualized growth of the common dividend per share. This is the case both on a standalone and pro forma basis.

I am also pleased to share that our Board has approved a new $3 billion share purchase authorization to be executed through 2028. As you can imagine, certain elements of this chart, such as the starting point for excess cash and liability management, will look very different after we close the acquisition. As such, I do not intend to go further into detail on this slide. We will provide a fulsome update on capital allocation alongside our key financial metrics once we close on the LS Power assets acquisition. In closing, NRG has delivered outstanding financial and operational results through the first three quarters of this year, and we are poised to finish the year on a high note. The standalone 2026 financial guidance and capital allocation outlook I have shared today further demonstrates the solid growth and continued performance of our standalone-based business.

I look forward to providing you updated and detailed guidance for 2026 that includes the assets we are acquiring from LS Power following the closing of the transaction. With that, I'll turn it back to you, Larry.

Thank you, Bruce. Turning to slide 15, 2025 has been an outstanding year across every part of our business. Our outlook continues to improve. Our near-term focus is on completing the LS Power acquisition and providing you with an updated long-term outlook following the close. We also continue expanding our data center portfolio, advancing our Texas Energy projects, including completing the construction of the T.H. Wharton project and returning at least $1.3 billion to shareholders. These priorities reflect a disciplined approach to growth and capital allocation as we position NRG for 2026 and beyond, continuing to build a company defined by consistent execution and accelerating value creation.

With that, we'll now open the line for questions.

Thank you. At this time, we will conduct the question-and-answer session. As a reminder, to ask a question, you will need to press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. Our first question comes from Shar Pourreza with Wells Fargo. Please go ahead.

I'm ready to go back to guardian leave, to be honest.

Yeah. I want to see the flowers, Shahriar. I want to see the flowers.

There you go. Good morning, Bruce. Good morning, Rob, too. [crosstalk].

Larry, just do you think 2026 is kind of that year you're going to be able to announce a data center agreement that includes new development as part of your GEV-Kiewit partnership?

Yes. You tongue-tied me again. Shar, you'll remember the last time I gave you a one-word answer, it showed up. So I'm giving you a one-word answer.

Any sense around timing next year? Are we thinking back half or earlier part of the year?

It's hard to tell, Shar, as my good friend Max said yesterday, these are complex, but super excited by the process and never been more sure.

Got it. Okay. That's helpful. And then just lastly, just maybe share a little bit more about sort of the announced data center deals, how they kind of compare to those announced by your peers.

A little bit more color around the margins given other peer deals have come with generation linkages. Thanks.

Yeah. We have put a little slide in the appendix which kind of talks about margin and pricing. This is very similar to the one that we announced last quarter, just locationally different. Premium margin as a result. Different things go into getting our premium margin on any deal, including land, including our commercial acumen. I mean, I really need to say we have the best commercial team in the business at both gas and electricity. Being able to really meet customer needs in a flexible way, all of those lead to the margin that you see in that appendix, Shar.

Got it. Okay. That is super helpful. Appreciate that, Larry. Bruce, keep working hard. I like what I am seeing here. Thanks, guys.

Our next question comes from Julien Dumoulin-Smith with Jefferies. Please go ahead.

Hey, good morning, team. How are you guys all doing? There we go.

Quite well. Quite well. We're slaving away here, as they say. Look. Let me jump back to the—let me ask the same question that our buddy just asked a second ago in a different way. Look, as far as GEV goes and this Kiewit partnership, do you have a certain timeframe that you need to move some of this equipment, use it or lose it, if you will? Can you speak to that a little bit? Because I think that's probably an important nuance to speak to when you talk about your confidence and the timelines under which you're operating to execute on this.

Look, Julien, we haven't disclosed any timelines, but I'm very confident that we're going to meet all of the timelines that are required under that agreement. What you're really trying to do, Julien, I know, is pin me to a month, and I'm not going to let you do that.

Absolutely. I mean, you know we're all trying. I mean, Shar did his best at it, too. I appreciate the effort. It was well done, but not quite there. All right. I got it. Let me ask you this way. As far as it goes with the build-your-own-power, BYOP, as we're calling it, right. There's clearly been an evolution in the marketplace. When you think about the scope of what's possible here, again, I know folks have been looking at co-located opportunities the last couple of years, but now we've firmly shifted. How meaningful, right?

We've seen a few announcements here with a couple of hundred MW here, a couple of hundred MW this quarter. I mean, when you say you're going to deliver updates next year, can you speak to BYOP and the scale of what's at hand here in terms of really building out contract at Gen?

Sure. Look, just starting with the GEV-Kiewit deal, Julien, that's 5.4 GW. So that's a good place to start from. I mean, there are some things that could be added to that in a variety of ways that we're looking at. But I think if we brought even 5.4 GW to the table, you would be and everyone would be super happy for us.

I mean, the scale, I mean, that's kind of the scale that we're focused on right now, but we are looking at opportunities to see how we can make that even greater.

Got it. All right. Let me just shift this slightly. When you think about the focus here, I mean, a lot of conversation has been around your portfolio in Texas and ERCOT specifically. Can you speak a little bit more broadly? Obviously, you guys have Illinois sites, PJM is talking increasingly about bringing new assets to, for Illinois just passed legislation in recent weeks. For instance, is there an opportunity in the PJM portfolio to both add gas and storage specifically and perhaps tap into some of these developments that have been recently afoot to kind of quell the state's needs for new capacity?

Absolutely, Julien. We are working hard on that, and we'll really accelerate those efforts, of course, once LS closes. Because until we own the generation assets there, that will really vault us into being a significant player. There is no grass growing under our feet there in the meantime.

Got it. All right. Illinois legislation, is there something for you guys to do there specifically to asset more pointedly?

I do not think the legislation is really going to be the driver of this, Julien. As you know, we do have sites in Illinois.

Absolutely. All right. I'll leave it there. Thank you guys very much. All the best. See you soon.

Thank you. Our next question comes from Angie Storozynski with Seaport. Please go ahead.

Thank you. First of all, no longer seeing the.

Good morning. No longer see the slide showing the sensitivity of your gross margin to changes in forward power curves. I mean, we've had finally the move in curves we had waited for. I am just wondering if anything's changed there. Are you waiting to update it for your enlarged portfolio? Any comments?

Angie, you just hit the nail on the head. We are waiting to update it for our enlarged portfolio.

Okay. You are not going to give me any sense how, especially the PJM price is moving, how they are impacting the pro forma EBITDA of the company for now?

Not at this stage. We will provide, obviously, a very fulsome update soon after we close on the transaction.

Okay. The second thing is, we've had some companies, new power companies or pretending to be new power companies that have aspirations to build gas plants without any prior expertise in power. I mean, it is surprising that they could be ahead of you in the pecking order, if not for the fact that you guys actually have sites, have equipment, know how to hedge gas, etc. Is it that they just talk more about their opportunities versus you guys, or do you still feel like you have a head start over those companies?

Angie, I'm convinced that we're in a great position to do what I was describing. I've been at this a long time, so have you. There's a lot of announcements. When I actually see, to use Sam Altman's new term, electrons flowing, then I will actually believe that they're real or we'll see steel in the ground. We are not one to tell you what we've done.

We do not tell you what we are going to do. That is kind of my philosophy in all this. There are going to be a lot of announcements because a lot of people think they are data center and power developers. Some of those are probably real, but I am very, very comfortable with where we sit in the pecking order, both with respect to building power plants and with respect to hyperscalers.

Okay. One more. I mean, we are still seeing a lot of private assets being offered to companies like you, hopefully. You do have a large pending acquisition, and I am just wondering if you would still have interest in single asset transactions before the LS Power transaction closes.

We look at everything, and if there is something that is economically attractive that is a great fit for our portfolio, we would be interested.

We do not feel we need to add any additional capacity given the LS acquisition, the Rockland acquisition, and the TEF projects, but we are always opportunistic when these things are out there.

Lastly, Bruce, you mentioned the free cash flow guidance for 2026. The fact that you are sort of running out of the tax shield. I mean, the LS Power transaction brings the tax shield, right? So there would be presumably an improvement. Free cash flow generation of the current business on the back of that transaction. Is that fair?

Yeah. I think that is generally a fair statement, Angie. The one thing that I will just clarify for you is that uptick in cash tax that we talk about on a standalone basis is not necessarily related to our NOLs disappearing.

It's really more about certain tax credits that we had from our days when we owned renewable assets that eventually expired. And so, regardless of the LS transaction, we're still going to have a very sizable NOL position, but clearly, the LS transaction is going to give us even more, which should inherit to a cash flow benefit.

Thank you. Next question comes from James West with Melius Research. Please go ahead.

Doing all right. Thanks, Larry. Larry, in your prepared comments, both at the beginning and the end, I think you made it very clear that you guys are not just standing still waiting to close LS, but you've got a lot of other things going on. If you were to kind of rank order what you're most excited about outside of that transaction.

What would you say are the top kind of one, two, three other things, other items that you're waiting to hopefully announce to us in the near term?

I'm going to do them in no particular order because otherwise, that's like picking favorites among your kids.

I mean, we have both on the C&I and on the retail side and energy and in smart home, we have a lot of people kind of lost sight of we have a very exciting growth plan where we're killing it. Second, our residential VPP excites me tremendously. And after LS closed, I'm also even more excited about our demand response potential. I look at all of those things. I guess the fourth thing I would say is bringing our first TEF project online and making progress on the other two.

There is a lot going on here that we have not even begun to put into our numbers. Even if there were no—just as a reminder, even if there were no data centers at all and no changes in power prices, we are still showing a 14% CAGR, and we still have a double-digit free cash flow. Discount rate. I am super excited about that. I do not know where I could get in the market with not much downside, those kind of numbers, leaving out all the other great things that we are doing. I am as bullish as I have ever been.

Okay. Good to hear. I will leave it there. Great.

Thank you. Our next question comes from Nick Campanella with Barclays. Please go ahead.

Hey, morning. Thanks for taking my question.

I am doing well. I am doing well. Hope you are well, too.

Maybe I can just follow up on the BYOP combo, just. Your conversation with policymakers at the states you operate in. How does that look in terms of BYOP? How have the customer conversations evolved over the last six months? Is it a fair assumption that all deals going forward just need some type of additionality in this space now, or how would you kind of frame that?

I mean, speaking to all deals is hard, but it starts with the Secretary of Energy who's been very, very explicit on this. I think as regulators more and more look at the affordability question and how to distribute the cost of this new power. The simplest way to do it and the fairest way to do it, I think, is probably bring your own gen. Now, whether that's megawatt hour per megawatt hour or 75% or 50% or some other measure, I think, remains to be seen. I think every policymaker is looking at this for two reasons. One is the affordability factor, and two is everyone knows they need new power. Everyone knows they need new infrastructure. To the extent if you're the governor of, say, New Jersey or Pennsylvania or somewhere like that, you would rather spread that cost across Amazon or Meta's or Google's or Microsoft's billions of customers around the world rather than your own ratepayers. This is a trend that we started talking about a year ago and prepared for it with our GEV and Kiewit joint venture, and it's now really coming home to roost and accelerating in the last few months.

Definitely recognize that. Thanks for those thoughts.

Maybe just with PJM being a more important jurisdiction pro forma this LS Power deal, can you talk about the capacity auction and just the prospects and timing for the collar to potentially be extended or just what you're advocating for with stakeholders, where you think the industry is heading, and ultimately what outcome you think would be good for the industry? Thanks.

Hey, it's Rob. Look, nothing's changed since the last auction as far as supply and demand. I would expect that that means that we're going to price at the top of that cap and collar. As far as long-term goes, they're looking at lots of different ways to solve the equation. Ultimately, everybody is generally concerned about reliability, and they're concerned about things like affordability. In order to get reliability, you have to have price signals.

The market has to reflect something for something to get built. As far as the collar being extended, we were supportive of the collar last time. I could see it being extended again because it provides certainty for everyone in the markets. Whether or not the top end of that collar is at the right place, that's yet to be determined.

Thank you. Our next question comes from Carly Davenport with Goldman Sachs. Please go ahead.

Hey, good morning. Thank you for taking the questions.

Doing well, thanks. Hope you are too. Larry, you mentioned before your excitement about the resi-VPP program and the pilot there. I guess any updates on how that's tracking in terms of uptake and if that's something that we should expect to see sort of regular updates on in subsequent calls?

Hi. Thank you. Yeah. No, we've been very pleased with the progress on VPP. As you're aware, we did raise guidance earlier this year for the balance of 2025. We went from 20 MW to 150 MW. We remain on track for our 1 GW by year-end 2035. I'm sorry. That would change things a lot. By 2035. We received a lot of great feedback from customers about the value and the experience of our offering. We're really excited about that. We're actually installing more customers than anticipated. I think as we had shared in our last interview, we're actually seeing the upgrade of additional equipment kind of 2x our expectations.

Apart from that, we're also piloting some additional new home automation offerings, which not only deliver the demand response, but will also help reduce home energy consumption, which will enable us to offer customers home energy savings. As affordability and grid capacity become more critical, NRG really has the only solution to meet those needs to be able to reduce energy consumption and save customers money. We're really excited about piloting that, not just in Texas, but we will also be taking that out to the east early next year.

Great. Okay. That's super helpful. Thanks for that. Maybe just on the data center pipeline. You have one agreement with first delivery in 2026, another in 2028. I guess, is there any trend that you're seeing in terms of when customers are looking to be energized on these fields?

NRG Energy (NRG) Q3 2025 Earnings Call Transcript

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