10-Q · May 6, 2026
NRG Energy, Inc. reported strong Q1 2026 results, with revenue hitting $10.26 billion, significantly surpassing estimates of $8.98 billion. The company's diluted EPS came in at $0.52, lower than the estimate of $1.73…
Earnings analysis · 10-Q
NRG earnings analysis
Filed August 4, 2026 · Our reading of the company's report
The latest report
NRG delivered a strong Q2 GAAP turnaround: revenue increased 11.0% year over year to $7.481B, operating income reached $976M, and diluted EPS was $2.31 versus a $0.62 loss in Q2 2025. The East segment and acquired LS…
Read full summary
NRG delivered a strong Q2 GAAP turnaround: revenue increased 11.0% year over year to $7.481B, operating income reached $976M, and diluted EPS was $2.31 versus a $0.62 loss in Q2 2025. The East segment and acquired LS Power/CPower assets were the principal growth drivers, while Texas economic gross margin declined $139M. The central trade-off is balance-sheet pressure after the acquisition: liquidity fell to $5.280B and total debt and finance leases rose to $23.437B, driving Q2 interest expense up to $310M.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $2.31
What stood out
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Revenue grew 11% year over year
Q2 revenue rose $741M year over year to $7.481B, up 11.0% from $6.740B. Revenue was down 27.1% sequentially from Q1's $10.260B, reflecting normal seasonality and portfolio/commodity variability.
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Margins rebounded sharply
Gross margin increased to $2.092B (28.0% of revenue) from $1.319B (19.6%) a year earlier and $1.503B (14.7%) in Q1. Operating income was $976M, or a 13.1% margin, versus breakeven operating income in Q2 2025 and $325M in Q1.
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GAAP earnings returned to profit
GAAP diluted EPS was $2.31, versus a $0.62 diluted loss per share in Q2 2025 and $0.52 in Q1 2026. Net income was $506M versus a $104M loss a year ago.
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East drove the earnings recovery
East revenue increased $774M to $3.512B and segment operating income swung to $506M from a $346M loss. Management attributed the economic-gross-margin improvement to acquired LS Power capacity, Midwest Generation, CPower demand response, and higher PJM auction prices.
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Vivint growth improved profitability
Vivint Smart Home revenue grew $65M to $587M and operating income improved to $71M from a $115M loss. Ending smart-home customers rose 192,000 year over year to 2.521M.
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New capacity supports future earnings
NRG completed commercial operation of the 415-MW T.H. Wharton project in May 2026. Its PJM fleet cleared approximately 6,839 MW in the 2028/2029 auction, with expected capacity revenue of approximately $811M for that delivery year.
What to watch
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Acquisition materially reduced liquidity
Liquidity excluding counterparty funds fell $4.348B to $5.280B at June 30 from $9.628B at December 31, primarily because of the LS Power acquisition. Cash and equivalents declined to $162M from $4.708B.
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Leverage and interest burden increased
Long-term debt and finance leases, including current maturities, increased $6.837B to $23.437B from $16.600B. Q2 interest expense rose $162M year over year to $310M, which management primarily attributed to LS Power financing, assumed Lightning debt, and refinancing.
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Cash conversion and capex demands are elevated
Six-month operating cash flow declined $358M year over year to $948M, while capital expenditures increased $60M to $655M. Management forecasts another $1.442B of cash capital expenditures and investments in the remainder of 2026.
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Commodity moves could require major collateral
The company estimates a $0.50/MMBtu decline in natural-gas prices would increase margin collateral posted by about $1.4B. It already had $441M of cash collateral and $2.5B of third-party letters of credit supporting market activities at June 30.
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Texas profitability weakened
Texas revenue declined $99M year over year to $2.747B and Texas economic gross margin fell $139M. Management cited a $101M higher cost to serve retail load and a $45M load-related decline from customer mix, attrition, and weather.
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No material risk-factor updates disclosed
Item 1A states there were no material changes to the risk factors disclosed in the 2025 Form 10-K during the six months ended June 30, 2026. Accordingly, the filing does not identify a newly added or materially revised risk factor.
Management's outlook
The 10-Q provides no explicit revenue or EPS guidance. MD&A forecasts full-year 2026 cash capital expenditures and investments of $2.244B, including $1.442B in the second half, and anticipates net income-tax payments of up to $90M in 2026. It also targets 7%-9% annual dividend-per-share growth in subsequent years; the separate earnings release reaffirmed Adjusted EPS and FCFbG guidance.
Earlier filings 4
10-K · February 24, 2026
NRG reported 2025 revenue of approximately $30.7 billion (sum of quarterly results) with the company completing a major portfolio acquisition just after year‑end: on January 30, 2026 NRG closed the LSP Portfolio…
10-Q · August 6, 2025
NRG reported second-quarter revenue of $6,740 million, up $81 million versus Q2 2024, but operating income collapsed to $0 (from $1,410 million a year ago) and the company reported a net loss of $104 million (diluted…
10-K · February 26, 2025
NRG positions itself as an integrated energy and smart-home platform combining retail energy (6 million retail energy customers), smart-home (2 million Vivint customers) and ~13 GW of generation to drive recurring cash…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.