AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-2: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 4/6 · 19/10/2026
Moat—
Insufficient evidence for every rubric criterion; no category score is inferred.
structural advantage · — · Superior nuclear availability is established, but comparative all-in costs and barriers preserving its economic benefit are missing. Low retail entry barriers qualify the customer franchise. The overall moat remains uncertain.
durability · — · Operating outperformance has persisted, and signed 20-year PPAs establish demand commitments. Neither establishes durable excess returns; Crane remains conditional and license extensions require approval.
customer dependency · — · Renewals and customer duration demonstrate repeat demand, but material switching friction or dependency is unestablished. Competitive pricing and broker-assisted supplier selection provide alternative explanations.
erosion resilience · — · The catalog establishes operating persistence but cannot establish resilience of economic rents against market-rule changes, competing technologies and capital requirements. Generic risks are possibilities, not proof of realized structural weakness.
Pricing power56
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
realized pricing · 2/4 · Higher capacity revenues and management's report of higher realized customer margins support favorable observed outcomes. Lower CMC revenue and the first-quarter $285 million state-program revenue reduction provide offsets. Evidence supports mixed pricing strength rather than a sustained company-specific premium; reference market prices are not treated as realized prices.
retention · 3/4 · Directly reported 2023–2025 power renewals of 75%, 78% and 77%, and gas renewals of 90%, 88% and 84%, demonstrate strong repeat purchasing. Approximately six-year customer duration supports the assessment. Declining gas renewals and the role of competitive pricing limit evidence of price-insensitive loyalty.
margin resilience · 2/4 · Capacity costs are incorporated into customer sales prices, and higher realized customer margins were reported. First-half operating income increased while second-quarter operating income declined. Outages, integration costs, acquisition effects and hedge marks complicate attribution; resilience is mixed rather than demonstrably driven by pricing power.
contractual freedom · 2/4 · Negotiated bilateral capacity contracts demonstrate discretion over some prices. Auctions, administratively determined ZEC prices and caps, and PTC refund or pass-through obligations constrain discretion elsewhere. Long-term PPAs do not disclose repricing rights.
Predictability—
Five consecutive annual periods are required for predictability; the accepted history is incomplete.
Financial strength47
Equal-weight grades: debt/FCF (1–8x), net debt/earnings before interest and tax (0–5x), interest service (1–12x), current ratio (0.75–2x). Earnings use reported operating income, or reported pretax profit plus reported interest expense when operating income is unavailable. Interest service uses earnings/interest expense; if unavailable, it uses reported operating cash flow/cash interest paid, without relabeling cash paid as accrued expense. Nonpositive cash flow/earnings score 0 for their service component; reported zero interest with a positive numerator scores 100. Net cash scores 100 for net leverage. Missing disclosures remain unavailable. General nonfinancial-company rubric, not a credit rating; exceptional and nonoperating gains are not normalized out. IFRS finance-cost and cash-flow classifications retain their reported scope.
- debtFcfGrade
- 14.55
- netDebtEbitGrade
- 65.32
- interestCoverageGrade
- 45.81
- currentRatioGrade
- 62.04
- Debt / FCF (x)
- 6.98
- Net debt / operating income (x)
- 1.73
- Interest coverage (x)
- 6.04
- Current ratio (x)
- 1.53
Capital allocation66
Three-year equal-weight indicators: pretax return on average invested capital (0–25%; equity + debt − cash, each year and its prior year), share-count growth (0–5%, lower better), share-based cost/revenue (2–20%, lower better), consolidated FCF/net income (0–1x). Return uses reported operating income or, if unavailable, EBIT calculated from reported pretax profit plus reported interest expense; exceptional/nonoperating gains are not normalized out. Share-based cost uses the reported cash-flow add-back or, if absent, separately reported recognized compensation expense; the latter never becomes an FCF adjustment. Nonpositive net income scores 0 for cash conversion; absent income/FCF stays unavailable. Nonpositive invested capital has no defined return and remains unavailable. Does not establish acquisition quality or buyback timing.
- 3-year pre-tax operating return (%)
- 15.59
- 3-year average dilution (%)
- -1.55
- 3-year average SBC / revenue (%)
- 1.43
- cashConversionGrade
- 0.00
Management69
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 2/4 · Actual first-half operating cash flow of $1.553 billion, capital expenditures of $2.521 billion and repurchases of $1.971 billion support assessment of deployment and funding. Calpine required 50 million new shares, approximately $4.5 billion cash and assumption of $12.6 billion debt. This is a mixed capital record with substantial commitments; unavailable standalone acquired earnings prevent confirmation of acquisition returns.
incentive alignment · 3/4 · Actual grants allocated 67% of LTIP to performance shares and 33% to RSUs, supported by a 36-month relative TSR metric, clawback provisions and no discretionary AIP adjustment in 2025. Compensation cash-flow adjustments and missing detailed ownership compliance limit the conclusion. Grants are not treated as vested awards.
execution · 3/4 · Multi-year nuclear operating results, shorter comparative outages, actual retail renewals, signed PPAs and Pin Oak Creek commercial operation demonstrate strong execution. Quarterly capacity factor declined, but additional planned outages and fewer unplanned outage days qualify that result. Crane delivery and Calpine integration returns remain unproven.
governance · 3/4 · A separate independent chair, independent committees, annual evaluations and defined risk oversight support strong governance arrangements. Five actual Audit & Risk Committee meetings in 2025 demonstrate activity. These disclosures do not establish exceptional effectiveness; prospective board declassification is not assumed completed.
Evidence
During 2025, 2024, and 2023, our nuclear generating facilities achieved capacity factors(a) of 94.7%, 94.6%, and 94.4%, respectively, at ownership percentage.
Item 1, Business — Nuclear Facilities; 2023–2025 capacity factors · Filed 24/02/2026
The nuclear capacity factor has been approximately four percentage points better than the industry average annually since 2013.
Item 1, Business — Nuclear Facilities; industry capacity-factor comparison · Filed 24/02/2026
We achieved an average refueling outage duration of 19 and 21 days in 2024 and 2023, respectively, against industry averages of 33 and 38 days, respectively.
Item 1, Business — Nuclear Facilities; comparative refueling outage durations · Filed 24/02/2026
Best-in-Class Nuclear Operations in a High Planned Refueling Outage Year 10 75% 80% 85% 90% 95% 100% 30 35 40 45 T W h s C ap acity F acto r Q2 24 Q3 24 Q4 24 Q1 25 Q2 25 Q3 25 Q4 25 Q1 26 Q2 26 TWhs Capacity Factor Nuclear Refueling Outages Completed Faster than Industry Average Even with Uprate 2026 Quarterly Capacity Factors Represent Execution of Planned Refueling Outages (1,2) Included successful implementation of the turbine uprate at Byron Clean Energy Center’s Unit 1 Beat industry average of 38 days by 40% (3) (1) Salem and STP are not included in operational metrics (outage days, capacity factor and generation) (2) Capacity factors reflect net monthly mean methodology.
Earnings presentation, page 10 — nuclear operations and turbine uprate · Filed 06/08/2026
Q2 2025 Q2 average nuclear refueling outage duration: 23 days
Earnings presentation, page 10 — second-quarter refueling outage duration · Filed 06/08/2026
The variance in Net income (loss) attributable to common shareholders was unfavorable by ($326) million primarily due to: •Unfavorable net unrealized losses on economic hedges; •Unfavorable Calpine merger and integration costs; and •Unfavorable impacts from nuclear outages.
MD&A, Results of Operations — second-quarter adverse earnings drivers · Filed 06/08/2026
Our business is capital intensive and requires considerable capital resources.
MD&A, Liquidity and Capital Resources — capital intensity · Filed 06/08/2026
The imposition of price caps, the issuance of orders extending the operation of generation resources slated for retirement, the imposition of requirements that new large load secure supply from new generation resources or agree to be interrupted, policies allowing utility-owned generation in restructured states, and policies favoring new resources at the expense of existing resources may lead to a market design that results in the premature retirement of existing resources, which would negatively affect our portfolio of assets as well as the market as a whole.
Risk Factors — market design and potential restrictions on existing generation · Filed 24/02/2026
The improvements in advanced nuclear including Small Modular Reactors (SMR), growing state and federal support, and the potential to rapidly reduce costs with scaled deployment create a potential path to market for new nuclear within the next decade.
Business — potential development of advanced nuclear generation · Filed 24/02/2026
• Coast-to-coast fleet to support economic growth, electric system reliability and national security • New build cost of our ~55 GW fleet would be more than 3x our current enterprise value Driving Value through Capital Allocation • Strong investment grade balance sheet and growing free cash flow* enables our value-enhancing capital allocation framework: – Share buyback authorization of $5.0B underscoring confidence in our outlook and executing on our future optionality – $3.9B of growth capital in projects at compelling returns – Scale that positions us to potentially bring natural gas, storage capacity and new nuclear uprates to the grid in the near term
Additional Disclosures 15
20 25 30 35 40 45 50 55 60 20 25 30 35 40 45 50 55 60 Market Revenues ($/MWh) M ar ke t R ev en u es + P T C ( $ / M W h ) 16 PTC Provides Support for Nuclear Units When Revenues Fall Below $44.75/MWh (1) Illustrative Payoff Dynamics for Non-State-Supported Units in 2026 • The PTC provides support of up to $15.00/MWh for units when revenues are between $26.00/MWh and $44.75/MWh while preserving the ability of the unit to participate in upside from commodity markets • The green line assumes revenues of $47.00/MWh.
Earnings presentation, pages 14–16 — replacement-cost assertion and illustrative PTC support · Filed 06/08/2026
Retail customer renewal rates have been strong over the last ten years across C&I power customer groups with average contract terms of approximately two years and customer duration of approximately six years, with many customers well beyond these metrics.
Business — retail contract terms and customer duration · Filed 24/02/2026
Specifically, we enjoyed renewal rates of 77% for C&I power customers and 84% for C&I gas customers in 2025, owing to both our competitive pricing as well as our strong customer relationships.
Business — 2025 C&I power and gas renewal rates · Filed 24/02/2026
Specifically, we enjoyed renewal rates of 78% for C&I power customers and 88% for C&I gas customers in 2024, owing to both our competitive pricing as well as our strong customer relationships.
Business — 2024 C&I power and gas renewal rates · Filed 18/02/2025
Specifically, we enjoyed renewal rates of 75% for C&I power customers and 90% for C&I gas customers in 2023, owing to both our competitive pricing as well as our strong customer relationships.
Business — 2023 C&I power and gas renewal rates · Filed 27/02/2024
In periods of sustained low natural gas and power prices and low market volatility, retail competitors can aggressively pursue market share because the barriers to entry can be low and wholesale generators (including us) use their retail operations to hedge generation output.
Risk Factors — low retail entry barriers under certain market conditions · Filed 24/02/2026
Consumer purchasing strategies have trended from direct supply relationships to third-party relationships with several customers looking to third-party consultants and brokers to find suppliers like us to reduce costs and evaluate the increasing number of options available for expanding energy solutions beyond the commodity.
Business — customer use of consultants and brokers · Filed 24/02/2026
The unfavorable items were partially offset by: •Favorable net market and portfolio conditions primarily driven by higher capacity revenues partially offset by lower CMC program revenue; and •Addition of Calpine operations acquired in January 2026, inclusive of the impacts of purchase accounting.
MD&A, Results of Operations — higher capacity revenues and lower CMC revenue · Filed 06/08/2026
(1) Initial full-year 2026 earnings guidance was based on expected average diluted common shares outstanding of 361 million (2) Revised full-year 2026 earnings guidance is based on expected diluted common shares outstanding of 357 million Raising Full-Year Adjusted Operating Earnings* Guidance Range to $11.50 - $12.50 Per Share 11 • Commercial business outperforming plan in a dynamic market – Higher realized customer margins – Successful portfolio optimization • Accretive deployment of capital through share repurchases • Partially offset by higher O&M due to performance related compensation expenses $/share Initial Guidance (1) Revised Guidance (2) $12.00 $12.50 $11.00 $11.50 $11.50 $12.00
Earnings presentation, page 11 — reported higher realized customer margins · Filed 06/08/2026
During the three months ended March 31, 2026, we recognized a reduction to net operating revenue of approximately $285 million associated with these programs in our Consolidated Statements of Operations and Comprehensive Income, compared to an increase to net operating revenue (pre-tax) of approximately $110 million for the three months ended March 31, 2025.
Government Assistance — first-quarter state-program net operating revenue adjustment · Filed 11/05/2026
We also incur capacity costs associated with load served, which are factored into customer sales prices.
MD&A, Capacity Prices — capacity costs included in customer sales prices · Filed 06/08/2026
59 Table of Contents Results of Operations Three Months Ended June 30, $ Change Six Months Ended June 30, $ Change 2026 2025 2026 2025 Operating revenues $ 7,504 $ 6,101 $ 1,403 $ 18,626 $ 12,889 $ 5,737 Operating expenses Purchased power and fuel 4,023 3,132 891 10,375 7,516 2,859 Operating and maintenance 2,253 1,617 636 4,033 3,162 871 Depreciation and amortization 443 254 189 886 502 384 Taxes other than income taxes 207 147 60 436 307 129 Total operating expenses 6,926 5,150 1,776 15,730 11,487 4,243 Gain (loss) on sales of assets 2 — 2 16 — 16 Operating income (loss) 580 951 (371) 2,912 1,402 1,510 Other income and (deductions) Interest expense, net (283) (118) (165) (536) (264) (272) Other, net 603 440 163 649 286 363 Total other income and (deductions) 320 322 (2) 113 22 91 Income (loss) before income taxes 900 1,273 (373) 3,025 1,424 1,601 Income tax (benefit) expense 398 440 (42) 928 462 466 Equity in income (losses) of unconsolidated affiliates 6 — 6 14 — 14 Net income (loss) 508 833 (325) 2,111 962 1,149 Net income (loss) attributable to noncontrolling interests (5) (6) 1 8 5 3 Net income (loss) attributable to common shareholders $ 513 $ 839 $ (326) $ 2,103 $ 957 $ 1,146 Three Months Ended June 30, 2026 Compared to Three Months Ended June 30, 2025.
MD&A, Results of Operations — second-quarter and first-half operating results · Filed 06/08/2026
We participate in capacity auctions in each ISO/RTO where we have qualifying generating assets.
MD&A, Capacity Prices — participation in capacity auctions · Filed 06/08/2026
We also enter into bilateral capacity contracts at negotiated contract prices.
MD&A, Capacity Prices — negotiated bilateral capacity contracts · Filed 06/08/2026
The ZEC price and annual compensation cap effective for each planning year are administratively determined by the IPA.
Revenue from Contracts with Customers — administrative determination of Illinois ZEC prices and caps · Filed 06/08/2026
Many of the state-sponsored programs providing compensation for the emissions-free attributes of generation from certain of our nuclear units include contractual or other provisions that require us to refund that compensation up to the amount of the nuclear PTC received or pass through the entirety of the nuclear PTC received.
Government Assistance — state compensation refunds and nuclear PTC pass-through provisions · Filed 24/02/2026
Depreciation, amortization, and accretion, including nuclear fuel and contract amortization
2,368
1,300
Deferred income taxes and amortization of ITCs
740
14
Net fair value changes related to derivatives
(589)
188
Net realized and unrealized (gains) losses on NDT funds
(419)
(336)
Net realized and unrealized (gains) losses on equity investments
24
275
Other non-cash operating activities
(240)
(21)
Changes in assets and liabilities:
Accounts receivable
307
208
Inventories
(63)
17
Accounts payable and accrued expenses
(1,277)
(229)
Option premiums received (paid), net
(52)
18
Collateral received (posted), net
(357)
(242)
Income taxes
13
209
Pension and non-pension postretirement benefit contributions
(200)
(181)
Other assets and liabilities
(813)
(598)
Net cash flows provided by (used in) operating activities
1,553
1,584
Cash flows from investing activities
Capital expenditures
(2,521)
(1,573)
Proceeds from NDT fund sales
4,737
3,830
Investment in NDT funds
(4,911)
(3,999)
Acquisition of Calpine, net of cash and restricted cash acquired
(2,537)
—
Other investing activities
131
(16)
Net cash flows provided by (used in) investing activities
(5,101)
(1,758)
Cash flows from financing activities
Change in short-term borrowings
2,586
—
Proceeds from short-term borrowings with maturities greater than 90 days
4,500
900
Repayments of short-term borrowings with maturities greater than 90 days
(3,500)
—
Issuance of long-term debt
5,001
—
Retirement of long-term debt
(5,352)
(1,008)
Dividends paid on common stock
(309)
(244)
Repurchases of common stock
(1,971)
(400)
Other financing activities
(78)
(141)
Net cash flows provided by (used in) financing activities
877
(893)
Increase (decrease) in cash, restricted cash, and cash equivalents
(2,671)
(1,067)
Cash, restricted cash, and cash equivalents at beginning of period
3,748
3,129
Cash, restricted cash, and cash equivalents at end of period
$
1,077
$
2,062
3
Table of Contents
Constellation Energy Corporation
GAAP Consolidated Statements of Operations and
Earnings release attachment, page 3 — first-half cash flows, capital expenditures and repurchases · Filed 06/08/2026
14 Table of Contents Combined Notes to Consolidated Financial Statements (Dollars in millions, unless otherwise noted) Note 2 — Mergers, Acquisitions, and Dispositions The merger consideration consisted of 50 million newly issued shares of our common stock, no par value, and approximately $4.5 billion in cash.
Note 2, Mergers, Acquisitions, and Dispositions — actual Calpine merger consideration · Filed 06/08/2026
13. Debt and Credit Agreements
Long-Term Debt
Calpine Acquisition
Upon completion of the acquisition of Calpine in January 2026, we assumed approximately $12.6 billion of debt inclusive of approximately $7.6 billion of corporate long-term debt, including senior unsecured and secured notes and corporate term loans in addition to approximately $5.0 billion of various project financing arrangements.
Note 13, Debt and Credit Agreements — debt assumed in Calpine acquisition · Filed 06/08/2026
However, as a result of the commencement of integration activities for certain functions and the consolidation of financing activities (see Note 13 — Debt and Credit Agreements), it is impracticable to determine Calpine’s earnings since the Acquisition Date.
Note 2, Mergers, Acquisitions, and Dispositions — inability to determine standalone acquired earnings · Filed 06/08/2026
RSUs (33% of LTIP) PShares (67% of LTIP) Dominguez 12,408 25,191 Eggers 3,282 6,662 Hanson 2,974 6,038 McHugh 2,769 5,621 Barrón 2,564 5,205 Restricted Stock Units (RSUs) RSUs vest ratably over a three-year period.
Compensation Discussion and Analysis — actual LTIP grants and three-year RSU vesting · Filed 19/03/2026
Relative Total Shareholder Return (“rTSR”) is a performance metric that compares TSR of the company with the TSR of the relative TSR peer group companies over the 36-month performance period.
2025–2027 Performance Share Program — 36-month relative TSR metric · Filed 19/03/2026
• Subject incentive compensation awards to clawback provisions in accordance with applicable Nasdaq requirements, as well as a broader clawback policy that applies to incentive compensation plans.
Executive Compensation Practices — incentive compensation clawback provisions · Filed 19/03/2026
The Compensation Committee may exercise its discretion to adjust awards otherwise earned under the AIP; however, no such discretion was exercised in 2025.
Annual Incentive Plan — no discretionary award adjustment in 2025 · Filed 19/03/2026
to exclude impacts of changes in working capital and other like adjustments as agreed by the Compensation Committee.
Performance Share Program — compensation cash-flow adjustments · Filed 19/03/2026
Board Governance Our corporate governance structure consists of certain elements, including the following: Independent Board Chair Chief Executive Officer and Board Chair roles are separate Committee Independence 100% of our committees are comprised of independent directors Director Stock Ownership Robust ownership requirements (i.e., 5x annual cash retainer) Board Self-Evaluations Annual evaluations for full Board which includes director interviews Outside Board Service Limit Maximum of 3 other public company Boards (CEO may only serve on the Board of one other public company) Mandatory Director Retirement By the annual meeting of shareholders following a director’s 80th birthday Committee Self-Evaluations Annual evaluations for each committee Succession Planning Annual evaluation of management succession and leadership Governance Assessment Annual review/assessment of governance policies Enterprise Risk Board oversight of enterprise risk, overseen by the Audit & Risk Committee Executive sessions Regular executive sessions of independent directors meeting without management Annual Election of Directors Following the 2026 Annual Meeting of Shareholders, the Board will be fully declassified Constellation Energy Corporation 2026 Proxy Statement 13 Proxy Summary Shareholder Engagement Shareholder Engagement We believe that engaging with our investors provides valuable insights for the Board and its committees with respect to investor perspectives and priorities.
Corporate Governance, page 13 — board leadership, independence and prospective declassification · Filed 19/03/2026
During the fiscal year ended December 31, 2025, the Audit & Risk Committee held five meetings.
Board Committees — five actual Audit & Risk Committee meetings in 2025 · Filed 19/03/2026
Audit & Risk Committee The Audit & Risk Committee’s duties and responsibilities include: • reviewing and discussing with management and the company’s independent registered public accounting firm, matters related to the annual audited financial statements, quarterly financial statements, earnings press releases and the accounting principles and policies applied; • considering and reviewing with management and the independent registered public accounting firm, matters related to the company’s internal controls over financial reporting; • reviewing the responsibilities, staffing and performance of the company’s internal audit function; • reviewing issues that arise with respect to the company’s compliance with legal or regulatory requirements and corporate policies dealing with business conduct; • appointing, compensating, retaining, and overseeing the company’s independent registered public accounting firm, while possessing the sole authority to approve all audit engagement fees and terms as well as all non-audit engagements with such firm; and • reviewing the policies and processes established by management to identify, assess, monitor, manage and control the company’s material strategic, financial, operational, regulatory, reputational and other risks and risk exposures.
Board Committees — Audit & Risk Committee responsibilities · Filed 19/03/2026
Capturing Value for Our Owners In June 2025, we signed a 20-year power purchase agreement (PPA) with Meta for the output of the Clinton Clean Energy Center to support their clean energy goals and operations in the region with 1,121 megawatts of emissions-free nuclear energy.
Board letter — signed 20-year Meta PPA for Clinton output · Filed 19/03/2026
In September 2024, we executed a 20-year PPA with Microsoft that will support the restart of Three Mile Island Unit 1, renamed as the Crane Clean Energy Center, which was retired in 2019 for economic reasons.
Business — signed Microsoft PPA and Crane's prior economic retirement · Filed 24/02/2026
The timing of the restart is subject to certain regulatory approvals, interconnection-related construction, permitting, and obtaining a renewed operating license.
Business — Crane restart approval, interconnection and licensing dependencies · Filed 24/02/2026
•Pin Oak Creek Energy Center Reaches Commercial Operation: On April 30, 2026, our Pin Oak Creek Energy Center achieved commercial operation.
First-quarter release — Pin Oak Creek achieved commercial operation · Filed 11/05/2026
Excluding Salem and STP, our nuclear plants at ownership achieved a 93.0% capacity factor for the second quarter of 2026, compared with 94.8% for the second quarter of 2025.
Second-quarter release — operated nuclear capacity-factor comparison excluding Salem and STP · Filed 06/08/2026
(3) 2025 industry average refueling outage was 38 days based on CEG annual industry benchmarking • Two fewer unplanned outage days in Q2 compared to prior year • Additional planned outage days reduced Q2 capacity factor by ~1.8% vs.
Earnings presentation, page 10 — fewer unplanned outage days and greater planned outage impact · Filed 06/08/2026
If approved, the units' operating licenses would be extended 20 years, to 2049.
Second-quarter release — proposed license extensions remain conditional on approval · Filed 06/08/2026
