Entergy Louisiana proposes about $12.9B in power plants
Entergy Louisiana’s pending application includes seven proposed generation resources totaling 5,278 MW and a transmission line estimated at $1.4 billion.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Form Type
10-Q
Entergy Louisiana, LLC (ELC) entered into a build-to-suit lease arrangement for Waterford 6 with a consortium of investors. The investors purchased the in-process project from Entergy Louisiana for $167.5 million and will spend up to $1.875 billion, including that purchase price, to construct it. Investors control the asset during construction, so Entergy Louisiana will not record construction work in progress or an associated liability. The lease is expected to begin when the plant is ready for first synchronization to the grid, expected in late 2029; its initial term ends seven years after closing.
Separately, Entergy Louisiana’s application to the LPSC seeks approval for seven combined-cycle generation resources totaling 5,278 MW at approximately $12.9 billion, as well as a 500 kV transmission line estimated at $1.4 billion, in connection with a second Meta data center in north Louisiana. A settlement with LPSC staff and one intervenor recommends certification of the proposed resources, and an LPSC decision is expected in December 2026. Evest’s service agreement obligations commence following construction of certain transmission facilities, and the agreement’s effectiveness is conditioned on required governmental approvals, including LPSC approval.
Key Figures
Waterford 6 project purchase price: $167.5 million
Waterford 6 construction spending: Up to $1.875 billion
Waterford 6 expected readiness: Late 2029
+4 more
7 metrics
Waterford 6 project purchase price
$167.5 million
Paid by the investors for the in-process project
Waterford 6 construction spending
Up to $1.875 billion
Includes the initial purchase price
Waterford 6 expected readiness
Late 2029
Expected first synchronization to the grid
Initial Waterford 6 lease term
Seven years
From closing of the arrangement
Proposed generation capacity
5,278 MW
Seven combined-cycle resources in Entergy Louisiana’s LPSC application
Proposed generation resource cost
Approximately $12.9 billion
Seven combined-cycle resources in Entergy Louisiana’s LPSC application
Proposed transmission line cost
$1.4 billion
500 kV line from West Fork Creek to St. Landry
Key Terms
build-to-suit lease arrangement, triple-net lease, construction work in progress, contributions in aid of construction
4 terms
build-to-suit lease arrangement financial
"entered a build-to-suit lease arrangement for the Waterford 6 Power Station"
triple-net lease financial
"a triple-net lease will commence"
A triple-net lease is a rental agreement where the tenant pays the base rent plus the property's operating expenses—typically taxes, insurance, and maintenance—so the landlord receives mostly a steady, predictable cash payment. For investors, it matters because it can act like a low-maintenance, bond-like income stream with clearer expense exposure, but returns depend on the tenant’s financial strength and long-term ability to cover those extra costs.
construction work in progress financial
"will not recognize the asset (i.e., construction work in progress)"
contributions in aid of construction financial
"including through contributions in aid of construction"
Contributions in aid of construction are one-time payments from customers, developers, or governments that cover part of the cost to build infrastructure—such as power lines, pipelines, or roads—that a utility or infrastructure company would otherwise pay for. Think of it like neighbors chipping in to pave a shared driveway: it reduces the company’s upfront spending, can lower future rates or fees for other customers, and changes reported assets and cash flow, so investors watch it for its impact on capital needs and future earnings.
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What are the terms of ELC’s Waterford 6 lease?
Entergy Louisiana may purchase Waterford 6 during the lease term for the investors’ total plant cost plus fees and carrying charges. At the end of the initial term, it must renew the lease for an additional five years subject to unanimous investor consent, purchase the plant, or sell it on the investors’ behalf. A purchase within two years of lease commencement requires a secured note payable.
What protections are in ELC’s Evest data center agreement?
The agreement requires Evest to pay Entergy Louisiana’s incremental costs to serve it, including through contributions in aid of construction, advance payments and minimum monthly bills. Evest’s obligations are secured by collateral that includes a guaranty from Meta Platforms, Inc. The agreements also specify financial obligations for early termination, project restructuring or default, based on unrecovered incremental costs.
AI-generated analysis. How Rhea-AI works. Not financial advice.
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Table of Contents
__________________________________________________________________________________________
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
| (Mark One) | |||||
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the quarterly period ended September 30, 2026
OR
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
| For the transition period from ____________ to ____________ | |||||
Commission File Number | Registrant, State of Incorporation or Organization, Address of Principal Executive Offices, Telephone Number, and IRS Employer Identification No. | Commission File Number | Registrant, State of Incorporation or Organization, Address of Principal Executive Offices, Telephone Number, and IRS Employer Identification No. | |||||||||||
(a Telephone ( | (a Telephone ( | |||||||||||||
(a Telephone ( | (a Telephone ( | |||||||||||||
(a Telephone ( | (an Telephone ( | |||||||||||||
(a Telephone ( | ||||||||||||||
__________________________________________________________________________________________
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Securities registered pursuant to Section 12(b) of the Act:
| Registrant | Title of Class | Trading Symbol | Name of Each Exchange on Which Registered | ||||||||
| Entergy Corporation | |||||||||||
| NYSE Texas | |||||||||||
| Entergy Arkansas, LLC | |||||||||||
| Entergy Louisiana, LLC | |||||||||||
| Entergy Mississippi, LLC | |||||||||||
| Entergy New Orleans, LLC | |||||||||||
| Entergy Texas, Inc. | |||||||||||
Securities registered pursuant to Section 12(g) of the Act:
| Registrant | Title of Class | ||||
| Entergy Texas, Inc. | |||||
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Indicate by check mark whether the registrants (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrants were required to file such reports), and (2) have been subject to such filing requirements for the past 90 days. Yes
Indicate by check mark whether the registrants have submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrants were required to submit such files). Yes
Indicate by check mark whether each registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Accelerated filer | Smaller reporting company | Emerging growth company | |||||||||||||||||||||||||||
| Entergy Corporation | ü | ||||||||||||||||||||||||||||
| Entergy Arkansas, LLC | ü | ||||||||||||||||||||||||||||
| Entergy Louisiana, LLC | ü | ||||||||||||||||||||||||||||
| Entergy Mississippi, LLC | ü | ||||||||||||||||||||||||||||
| Entergy New Orleans, LLC | ü | ||||||||||||||||||||||||||||
| Entergy Texas, Inc. | ü | ||||||||||||||||||||||||||||
| System Energy Resources, Inc. | ü | ||||||||||||||||||||||||||||
If an emerging growth company, indicate by check mark if the registrants have elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrants are shell companies (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑
| Common Stock Outstanding | Outstanding at October 30, 2026 | |||||||
| Entergy Corporation | ($0.01 par value) | |||||||
Entergy Corporation, Entergy Arkansas, LLC, Entergy Louisiana, LLC, Entergy Mississippi, LLC, Entergy New Orleans, LLC, Entergy Texas, Inc., and System Energy Resources, Inc. separately file this combined Quarterly Report on Form 10-Q. Information contained herein relating to any individual company is filed by such company on its own behalf. Each company makes representations only as to itself and makes no other representations whatsoever as to any other company. This combined Quarterly Report on Form 10-Q supplements and updates the Annual Report on Form 10-K for the calendar year ended December 31, 2025 and the Quarterly Report on Form 10-Q for the quarters ended March 31, 2026 and June 30, 2026, filed by the individual registrants with the SEC, and should be read in conjunction therewith.
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TABLE OF CONTENTS
| Page Number | |||||
Forward-looking Information | iii | ||||
Definitions | viii | ||||
| Part I. Financial Information | |||||
| Entergy Corporation and Subsidiaries | |||||
Management’s Financial Discussion and Analysis | 1 | ||||
Consolidated Income Statements | 26 | ||||
Consolidated Statements of Comprehensive Income | 27 | ||||
Consolidated Statements of Cash Flows | 28 | ||||
Consolidated Balance Sheets | 30 | ||||
Consolidated Statements of Changes in Equity | 32 | ||||
| Notes to Financial Statements | |||||
Note 1. Commitments and Contingencies | 34 | ||||
Note 2. Rate and Regulatory Matters | 36 | ||||
Note 3. Equity | 49 | ||||
Note 4. Revolving Credit Facilities, Lines of Credit, Short-term Borrowings, and Long-term Debt | 55 | ||||
Note 5. Stock-based Compensation | 60 | ||||
Note 6. Retirement and Other Postretirement Benefits | 62 | ||||
Note 7. Business Segment Information | 69 | ||||
Note 8. Risk Management and Fair Values | 72 | ||||
Note 9. Decommissioning Trust Funds | 87 | ||||
Note 10. Income Taxes | 93 | ||||
Note 11. Variable Interest Entities | 94 | ||||
Note 12. Revenue | 96 | ||||
Item 3. Quantitative and Qualitative Disclosures About Market Risk | 100 | ||||
Item 4. Controls and Procedures | 100 | ||||
| Entergy Arkansas, LLC and Subsidiaries | |||||
Management’s Financial Discussion and Analysis | 101 | ||||
Consolidated Income Statements | 114 | ||||
Consolidated Statements of Cash Flows | 115 | ||||
Consolidated Balance Sheets | 116 | ||||
Consolidated Statements of Changes in Equity | 118 | ||||
| Entergy Louisiana, LLC and Subsidiaries | |||||
Management’s Financial Discussion and Analysis | 119 | ||||
Consolidated Income Statements | 138 | ||||
Consolidated Statements of Comprehensive Income | 139 | ||||
Consolidated Statements of Cash Flows | 141 | ||||
Consolidated Balance Sheets | 142 | ||||
Consolidated Statements of Changes in Equity | 144 | ||||
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| Page Number | |||||
| Entergy Mississippi, LLC and Subsidiaries | |||||
Management’s Financial Discussion and Analysis | 145 | ||||
Consolidated Income Statements | 155 | ||||
Consolidated Statements of Cash Flows | 157 | ||||
Consolidated Balance Sheets | 158 | ||||
Consolidated Statements of Changes in Equity | 160 | ||||
| Entergy New Orleans, LLC and Subsidiaries | |||||
Management’s Financial Discussion and Analysis | 161 | ||||
Consolidated Income Statements | 171 | ||||
Consolidated Statements of Cash Flows | 173 | ||||
Consolidated Balance Sheets | 174 | ||||
Consolidated Statements of Changes in Member’s Equity | 176 | ||||
| Entergy Texas, Inc. and Subsidiaries | |||||
Management’s Financial Discussion and Analysis | 177 | ||||
Consolidated Income Statements | 188 | ||||
Consolidated Statements of Cash Flows | 189 | ||||
Consolidated Balance Sheets | 190 | ||||
Consolidated Statements of Changes in Equity | 192 | ||||
| System Energy Resources, Inc. | |||||
Management’s Financial Discussion and Analysis | 193 | ||||
Income Statements | 199 | ||||
Statements of Cash Flows | 201 | ||||
Balance Sheets | 202 | ||||
Statements of Changes in Common Equity | 204 | ||||
| Part II. Other Information | |||||
Item 1. Legal Proceedings | 205 | ||||
Item 1A. Risk Factors | 205 | ||||
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds | 205 | ||||
Item 5. Other Information | 206 | ||||
Item 6. Exhibits | 209 | ||||
Signature | 211 | ||||
ii
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FORWARD-LOOKING INFORMATION
In this combined report and from time to time, Entergy Corporation and the Registrant Subsidiaries each makes statements as a registrant concerning its expectations, beliefs, plans, objectives, goals, projections, strategies, and future events or performance. Such statements are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “may,” “will,” “could,” “project,” “believe,” “anticipate,” “intend,” “goal,” “commitment,” “expect,” “estimate,” “continue,” “potential,” “plan,” “predict,” “forecast,” and other similar words or expressions are intended to identify forward-looking statements but are not the only means to identify these statements. Although each of these registrants believes that these forward-looking statements and the underlying assumptions are reasonable, it cannot provide assurance that they will prove correct. Any forward-looking statement is based on information current as of the date of this combined report and speaks only as of the date on which such statement is made. Except to the extent required by the federal securities laws, each registrant undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.
Forward-looking statements involve a number of risks and uncertainties. There are factors that could cause actual results to differ materially from those expressed or implied in the forward-looking statements, including (a) those factors discussed or incorporated by reference in Item 1A. Risk Factors in the Form 10-K and in this report, (b) those factors discussed or incorporated by reference in Management’s Financial Discussion and Analysis in the Form 10-K and in this report, and (c) the following factors (in addition to others described elsewhere in this combined report and in subsequent filings with the SEC):
•resolution of pending and future rate cases and related litigation, formula rate proceedings and related negotiations, including various performance-based rate discussions, Entergy’s utility supply plan, and recovery of fuel and purchased power costs, as well as delays in cost recovery resulting from these proceedings;
•regulatory and operating challenges and uncertainties and economic risks associated with the Utility operating companies’ participation in MISO, including the benefits of continued MISO participation, the effect of current or projected MISO market rules, market design and market and system conditions in the MISO markets, the allocation of MISO system transmission upgrade costs, delays in developing or interconnecting new generation or other resources or other adverse effects arising from the volume of requests in the MISO transmission interconnection queue, which delays or other adverse effects may be exacerbated by significant current and expected load growth, the MISO-wide base rate of return on equity allowed or any MISO-related charges and credits required by the FERC, and the effect of planning decisions that MISO makes with respect to future transmission investments by the Utility operating companies (including, in each case, as it relates to new generation or transmission projects designed to serve the increased load growth of new large-scale data centers and other large customers);
•changes in utility regulation, including, with respect to retail and wholesale competition and special rules supporting service to large-scale data centers, the ability to recover net utility assets and other potential stranded costs, including those capital investments associated with unrealized customer growth expectations (including data center customers), and the application of more stringent return on equity criteria, transmission reliability requirements, or market power criteria by the FERC or the U.S. Department of Justice;
•changes in the regulation or regulatory oversight of Entergy’s nuclear generating facilities, nuclear materials and fuel, and the effects of new or existing safety or environmental concerns regarding nuclear power plants and fuel;
iii
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FORWARD-LOOKING INFORMATION (Continued)
•resolution of pending or future applications, as well as regulatory proceedings, litigation or actions of governmental officials (including the presidential administration), relating to generation, transmission, or other facilities (including license modifications or other authorizations for nuclear generating facilities and applications relating to any facilities designed to serve large-scale data centers) and the effect of public and political opposition on these applications, regulatory proceedings, litigation, and actions, including without limitation opposition to the employment of technologies to capture, transport, and store carbon dioxide from gas plants, land use opposition to new solar facilities and transmission lines, and land use and other opposition to wind turbines;
•the performance of and deliverability of power from Entergy’s generation resources, including the capacity factors at Entergy’s nuclear generating facilities;
•increases in costs and capital expenditures that could result from changing regulatory requirements, changing governmental policies, priorities, programs, and actions, including as a result of tariffs, executive orders, shifts in international trade policies, and other measures, changing or volatile economic conditions, disruptions to pre-existing supply chains and vendor relations, and emerging operating and industry issues, such as anticipated growth in demand from large-scale data centers, and the risks related to recovery of these costs and capital expenditures from Entergy’s customers (especially in an increasing cost environment);
•the commitment of substantial human and capital resources required for the safe and reliable operation and maintenance of Entergy’s utility system, including its nuclear generating facilities;
•Entergy’s ability to develop and execute on a point of view regarding future prices of electricity, natural gas, and other energy-related commodities;
•the prices and availability of fuel and power Entergy must purchase for its Utility customers, particularly given the recent and ongoing significant growth in liquified natural gas exports and the associated significantly increased demand for natural gas and resulting fluctuation in natural gas prices, increasing challenges with respect to natural gas transportation arrangements, and Entergy’s ability to meet credit support requirements for fuel and power supply contracts;
•volatility and changes in markets for electricity, natural gas, uranium, emissions allowances, and other energy-related commodities, including as a result of trade-related governmental actions, such as tariffs and other measures, or other geopolitical tensions, and the effect of those changes on Entergy and its customers;
•changes in environmental laws and regulations, agency positions, or associated litigation, including requirements for reduced emissions of sulfur dioxide, nitrogen oxide, greenhouse gases, mercury, particulate matter and other regulated air emissions, heat and other regulated discharges to water, waste management and disposal, remediation of contaminated sites, wetlands protection and permitting, and reporting, and changes in costs of compliance with environmental laws and regulations, as well as changes to federal, state, or local laws and regulations, including the One Big Beautiful Bill Act of 2025, and governmental policies incentivizing the development or utilization of alternative sources of generation;
•changes in laws and regulations, agency positions, or associated litigation related to protected species and associated critical habitat designations;
•the effects of changes in federal, state, or local laws and regulations, such as the One Big Beautiful Bill Act of 2025, and other governmental actions or policies, including changes in monetary, fiscal, tax, environmental, trade/tariff, domestic purchase requirements, or energy (including, among other things, data center energy use, efficiency standards, and sources of power) policies and related laws, regulations, and other governmental actions, including as a result of prolonged litigation over proposed legislation or regulatory actions;
•the effects of full or partial shutdowns of the federal government or delays in obtaining government or regulatory actions or decisions;
•uncertainty regarding the establishment of interim or permanent sites for spent nuclear fuel and nuclear waste storage and disposal and the level of spent fuel and nuclear waste disposal fees charged by the U.S. government or other providers related to such sites;
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FORWARD-LOOKING INFORMATION (Continued)
•variations in weather and the occurrence of hurricanes and other storms and disasters, including uncertainties associated with efforts to remediate the effects of hurricanes, ice storms, floods, wildfires, or other weather events and the recovery of costs associated with restoration, including the ability to access funded storm reserves, federal and local cost recovery mechanisms, securitization, and insurance, as well as any related unplanned outages;
•effects of climate change, including the potential for increases in the frequency or severity of extreme weather events, such as hurricanes, heat waves, floods, drought or wildfires, and rising sea levels or coastal land and wetland loss, and Entergy’s ability to effectively prepare for such effects and events, including through accelerated resilience plans and projects, and any challenges in execution thereof and/or in obtaining any necessary regulatory approvals for appropriate scope and timing of such plans and projects now and in the future;
•the risk that as a result of Entergy’s membership in Nuclear Electric Insurance Limited (NEIL), an incident at a NEIL member-insured nuclear generation facility could lead to a significant retrospective assessment;
•the risk that an incident at a nuclear generation facility participating in a secondary financial protection system could lead to a significant retrospective insurance premium;
•changes in the quality and availability of water supplies and the related regulation of water use and diversion;
•Entergy’s ability to manage and execute on its capital projects, including any capital projects to serve the growing demand for electricity driven in part by the anticipated development of large-scale data centers, and to complete such capital projects timely and within budget, to obtain the anticipated performance or other benefits of such capital projects, and to manage its capital and operation and maintenance costs;
•the effects of supply chain disruptions, including those driven by geopolitical developments or trade-related governmental actions, including tariffs, executive orders, and other measures, and labor pressures, including from increased demand in the electric sector, on Entergy’s ability to complete its capital projects in a timely and cost-effective manner;
•Entergy’s ability to purchase and sell assets at attractive prices and on other attractive terms;
•the economic climate, and particularly economic conditions in the Utility service area and events and circumstances that could influence economic conditions in those areas, including power prices and inflation, and the risk that anticipated load growth may not materialize;
•changes to or the repeal of federal income tax laws, regulations, and interpretive guidance and policies, including the One Big Beautiful Bill Act of 2025 and the continuing impact of the Inflation Reduction Act of 2022 and the Tax Cuts and Jobs Act of 2017, and any related intended or unintended consequences on financial results and future cash flows;
•the effects of Entergy’s strategies to reduce tax payments;
•the effect of interest rate volatility and other changes in the financial markets, federal law, including the One Big Beautiful Bill Act of 2025, and regulatory requirements for the issuance of securities, particularly as they affect access to and cost of capital and Entergy’s ability to refinance existing securities and fund investments and acquisitions;
•actions of rating agencies, including changes in the ratings of debt and preferred stock, changes in general corporate ratings, and changes in the rating agencies’ ratings criteria;
•changes in inflation and interest rates and the impacts of inflation or a recession on Entergy’s customers;
•the effects of government investigations, proceedings, or audits;
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FORWARD-LOOKING INFORMATION (Continued)
•changes in technology, including (i) Entergy’s ability to effectively assess, acquire, implement, and manage new or emerging technologies, including its ability to maintain and protect personally identifiable information while doing so; (ii) the emergence of artificial intelligence (including machine learning), which may present increased electricity demand, as well as ethical, security, including cybersecurity, legal, operational, or regulatory challenges; (iii) advances in artificial intelligence (including machine learning) technologies that could reduce the expected electricity demand for these technologies and data centers; (iv) the impact of changes relating to new, developing, or alternative sources of generation such as distributed energy and energy storage, renewable energy, energy efficiency, demand side management, and other measures that reduce load and government policies impacting development or utilization of the foregoing; and (v) competition from other companies offering products and services to Entergy’s customers based on new or emerging technologies or alternative sources of generation;
•Entergy’s ability to effectively formulate and implement plans to reduce emissions of greenhouse gases associated with climate change and increase carbon-free energy generation capacity, including its goal to achieve net-zero carbon emissions by 2050, the potential impact on its business and financial condition of attempting to achieve such objectives, and Entergy’s ability to make measurable progress toward any climate goals due to expected load growth or other factors;
•the effects, including increased security costs, of threatened or actual terrorism, cyber attacks, including those driven by artificial intelligence, or data security breaches, physical attacks on or other interference with facilities or infrastructure, natural or man-made electromagnetic pulses that affect transmission or generation infrastructure, accidents, and war or a catastrophic event such as a nuclear accident or a natural gas pipeline explosion;
•impacts of perceived or actual cybersecurity or data security threats or events on Entergy and its subsidiaries, its vendors, suppliers or other third parties interconnected through the grid, which could, among other things, result in disruptions to its operations, including but not limited to, the loss of operational control, temporary or extended outages, or loss of data, including but not limited to, sensitive customer, employee, financial or operations data;
•the effects of a catastrophe, pandemic (or other health-related event), or a global or geopolitical event, such as escalating trade tensions between the United States and China, the military activities between Russia and Ukraine or in the Middle East, or the military conflict in Iran, including resultant economic and societal disruptions; fuel procurement disruptions; volatility in the capital markets (and any related increased cost of capital or any inability to access the capital markets or draw on available bank credit facilities); reduced demand for electricity, particularly from commercial and industrial customers; increased or unrecoverable costs; supply chain, vendor, and contractor disruptions, including as a result of trade-related sanctions or geopolitical tensions; delays in completion of capital or other construction projects, maintenance, and other operations activities, including prolonged or delayed outages; impacts to Entergy’s workforce availability, health, or safety; increased cybersecurity risks as a result of many employees telecommuting and/or working partially remotely; increased late or uncollectible customer payments; regulatory delays; executive orders affecting, or increased regulation of, Entergy’s business; changes in credit ratings or outlooks as a result of any of the foregoing; or other adverse impacts on Entergy’s ability to execute on its business strategies and initiatives or, more generally, on Entergy’s results of operations, financial condition, and liquidity;
•Entergy’s ability to attract and retain talented management, directors, and employees with specialized skills, institutional knowledge, capacity, and abilities, including the ability to effectively execute on Entergy’s growth strategy;
•Entergy’s ability to attract, retain, and manage an appropriately qualified and sufficiently staffed workforce;
•changes in accounting standards and corporate governance best practices;
•declines in the market prices of marketable securities and changes in interest rates and resulting pension and retiree welfare plan funding requirements and the effects on benefits costs for Entergy’s defined benefit pension and other postretirement benefits plans;
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FORWARD-LOOKING INFORMATION (Concluded)
•future wage and employee benefits costs, including changes in discount rates and returns on benefit plan assets and fluctuating costs to provide employee and retiree health benefits;
•changes in decommissioning trust fund values or earnings or in the timing of, requirements for, or cost to decommission Entergy’s nuclear plant sites and the implementation of decommissioning of such sites following shutdown;
•the effectiveness of Entergy’s risk management policies and procedures and the ability and willingness of its counterparties, such as lending, hedging, credit support, and major customer counterparties, including counterparties to data center electric service agreements, to satisfy their financial and performance commitments;
•reductions in the demand for electricity to power large-scale data centers and other large customers and the potential for stranded assets;
•concentration of business and credit risk with a small number of customers in an industry based on emerging technologies, including artificial intelligence and machine learning; and
•Entergy and its subsidiaries’ ability to successfully execute on their business strategies, including their ability to complete strategic transactions that they may undertake, and their ability to meet the rapidly growing demand for electricity, including from large-scale data center and other large customers, and to manage the impacts of growth in demand for electricity on customers and Entergy’s business.
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DEFINITIONS
Certain abbreviations or acronyms used in the text and notes are defined below:
| Abbreviation or Acronym | Term | ||||
AFUDC | Allowance for Funds Used During Construction | ||||
| ALJ | Administrative Law Judge | ||||
| ANO 1 and 2 | Units 1 and 2 of Arkansas Nuclear One (nuclear), owned by Entergy Arkansas | ||||
| APSC | Arkansas Public Service Commission | ||||
ASU | Accounting Standards Update issued by the FASB | ||||
| Board | Board of Directors of Entergy Corporation | ||||
| Cajun | Cajun Electric Power Cooperative, Inc. | ||||
| capacity factor | Actual plant output divided by maximum potential plant output for the period | ||||
| City Council | Council of the City of New Orleans, Louisiana | ||||
| D.C. Circuit | U.S. Court of Appeals for the District of Columbia Circuit | ||||
| DOE | United States Department of Energy | ||||
| Entergy | Entergy Corporation and its direct and indirect subsidiaries | ||||
| Entergy Corporation | Entergy Corporation, a Delaware corporation | ||||
| Entergy Gulf States, Inc. | Predecessor company for financial reporting purposes to Entergy Gulf States Louisiana that included the assets and business operations of both Entergy Gulf States Louisiana and Entergy Texas | ||||
| Entergy Gulf States Louisiana | Entergy Gulf States Louisiana, L.L.C., a Louisiana limited liability company formally created as part of the jurisdictional separation of Entergy Gulf States, Inc. and the successor company to Entergy Gulf States, Inc. for financial reporting purposes. The term is also used to refer to the Louisiana jurisdictional business of Entergy Gulf States, Inc., as the context requires. Effective October 1, 2015, the business of Entergy Gulf States Louisiana was combined with Entergy Louisiana. | ||||
| Entergy Louisiana | Entergy Louisiana, LLC, a Texas limited liability company formally created as part of the combination of Entergy Gulf States Louisiana and the company formerly known as Entergy Louisiana, LLC (Old Entergy Louisiana) into a single public utility company and the successor to Old Entergy Louisiana for financial reporting purposes | ||||
| Entergy Texas | Entergy Texas, Inc., a Texas corporation formally created as part of the jurisdictional separation of Entergy Gulf States, Inc. The term is also used to refer to the Texas jurisdictional business of Entergy Gulf States, Inc., as the context requires. | ||||
| EPA | United States Environmental Protection Agency | ||||
FASB | Financial Accounting Standards Board | ||||
| FERC | Federal Energy Regulatory Commission | ||||
| Form 10-K | Annual Report on Form 10-K for the calendar year ended December 31, 2025, filed with the SEC by Entergy Corporation and its Registrant Subsidiaries | ||||
GAAP | Generally Accepted Accounting Principles | ||||
Grand Gulf | Unit No. 1 of Grand Gulf Nuclear Station (nuclear), 90% owned or leased by System Energy | ||||
GWh | Gigawatt-hour(s), which equals one million kilowatt-hours | ||||
| Independence | Independence Steam Electric Station (coal), owned 16% by Entergy Arkansas and 25% by Entergy Mississippi | ||||
IRS | Internal Revenue Service | ||||
| ISO | Independent System Operator | ||||
| kV | Kilovolt | ||||
kW | Kilowatt, which equals one thousand watts | ||||
kWh | Kilowatt-hour(s) | ||||
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DEFINITIONS (Concluded)
| Abbreviation or Acronym | Term | ||||
LPSC | Louisiana Public Service Commission | ||||
LURC | Louisiana Utilities Restoration Corporation | ||||
MISO | Midcontinent Independent System Operator, Inc., a regional transmission organization | ||||
MMBtu | One million British Thermal Units | ||||
MPSC | Mississippi Public Service Commission | ||||
MW | Megawatt(s), which equals one thousand kilowatts | ||||
MWh | Megawatt-hour(s) | ||||
Net debt to net capital ratio | Gross debt less cash and cash equivalents divided by total capitalization less cash and cash equivalents, which is a non-GAAP measure | ||||
NRC | Nuclear Regulatory Commission | ||||
Parent & Other | The portions of Entergy not included in the Utility segment, primarily consisting of the activities of the parent company, Entergy Corporation, and other business activity, including Entergy’s non-utility operations business which owns interests in non-nuclear power plants that sell the electric power produced by those plants to wholesale customers and also provides decommissioning services to nuclear power plants owned by non-affiliated entities | ||||
PPA | Purchased power agreement or power purchase agreement | ||||
PUCT | Public Utility Commission of Texas | ||||
Registrant Subsidiaries | Entergy Arkansas, LLC, Entergy Louisiana, LLC, Entergy Mississippi, LLC, Entergy New Orleans, LLC, Entergy Texas, Inc., and System Energy Resources, Inc. | ||||
River Bend | River Bend Station (nuclear), owned by Entergy Louisiana | ||||
SEC | Securities and Exchange Commission | ||||
System Energy | System Energy Resources, Inc. | ||||
Unit Power Sales Agreement | Agreement, dated as of June 10, 1982, as amended and approved by the FERC, among Entergy Arkansas, Entergy Mississippi, Entergy New Orleans, and System Energy, relating to the sale of capacity and energy from System Energy’s share of Grand Gulf | ||||
| Utility | Entergy’s reportable segment that generates, transmits, distributes, and sells electric power, and which included a small amount of natural gas distribution in portions of Louisiana through June 30, 2025 | ||||
| Utility operating companies | Entergy Arkansas, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, and Entergy Texas | ||||
Waterford 3 | Unit No. 3 (nuclear) of the Waterford Steam Electric Station, owned by Entergy Louisiana | ||||
weather-adjusted usage | Electric usage excluding the effects of deviations from normal weather | ||||
White Bluff | White Bluff Steam Electric Generating Station, 57% owned by Entergy Arkansas | ||||
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ENTERGY CORPORATION AND SUBSIDIARIES
MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS
Entergy operates primarily through a single reportable segment, Utility. The Utility segment includes the generation, transmission, distribution, and sale of electric power in portions of Arkansas, Mississippi, Texas, and Louisiana, including the City of New Orleans; and included operation of a small natural gas distribution business in portions of Louisiana through June 30, 2025. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy New Orleans and Entergy Louisiana natural gas distribution businesses on July 1, 2025. See Note 7 to the financial statements herein for discussion of and financial information regarding Entergy’s reportable segment.
Winter Storm Fern
In January 2026, portions of Entergy’s service territory experienced the effects of Winter Storm Fern, including prolonged freezing temperatures, heavy ice accumulations, and wind, which caused severe damage to Entergy’s infrastructure. Entergy’s cost of mobilizing crews and restoring power was approximately $450 million, including approximately $375 million in capital costs and approximately $75 million in non-capital costs. The impacts were primarily at Entergy Louisiana and Entergy Mississippi. There are well-established mechanisms and precedent for addressing these catastrophic events and providing the process for regulatory review of storm costs for prudence and for recovery of prudently incurred storm costs in accordance with applicable regulatory and legal principles. See Note 2 to the financial statements herein for discussion of Entergy Louisiana’s restoration costs from Winter Storm Fern included in its 2025 formula rate plan filing and for discussion of Entergy Mississippi’s storm cost recovery filing in October 2026.
The severe weather event also affected the market for natural gas due to the effects of severe cold on the gas supply system and increased demand for gas to support electricity loads. Natural gas purchases in January 2026 for Entergy were $483 million, including $74 million for Entergy Arkansas, $256 million for Entergy Louisiana, $85 million for Entergy Mississippi, $20 million for Entergy New Orleans, and $48 million for Entergy Texas. This compares to natural gas purchases in January 2025 for Entergy of $207 million, including $25 million for Entergy Arkansas, $115 million for Entergy Louisiana, $28 million for Entergy Mississippi, $4 million for Entergy New Orleans, and $35 million for Entergy Texas. The Utility operating companies each have fuel recovery mechanisms in place to recover their natural gas costs. See Note 2 to the financial statements herein and in the Form 10-K for a discussion of fuel cost recovery at the Utility operating companies.
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Entergy Corporation and Subsidiaries
Management’s Financial Discussion and Analysis
Results of Operations
Third Quarter 2026 Compared to Third Quarter 2025
Following are income statement variances for Utility, Parent & Other, and Entergy comparing the third quarter 2026 to the third quarter 2025 showing how much the line item increased or (decreased) in comparison to the prior period.
Utility | Parent & Other (a) | Entergy | ||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||
| 2025 Net Income (Loss) Attributable to Entergy Corporation | $810,462 | ($116,662) | $693,800 | |||||||||||||||||
| Operating revenues | 555,571 | (2,422) | 553,149 | |||||||||||||||||
| Fuel, fuel-related expenses, and gas purchased for resale | (94,107) | (3,174) | (97,281) | |||||||||||||||||
| Purchased power | 192,560 | 1,704 | 194,264 | |||||||||||||||||
| Other regulatory charges (credits) - net | 2,847 | — | 2,847 | |||||||||||||||||
| Other operation and maintenance | 61,308 | 405 | 61,713 | |||||||||||||||||
Asset write-offs, impairments, and related charges | (12,795) | — | (12,795) | |||||||||||||||||
| Taxes other than income taxes | 8,745 | 7 | 8,752 | |||||||||||||||||
| Depreciation and amortization | 27,157 | (1,141) | 26,016 | |||||||||||||||||
| Other income (deductions) | 61,137 | 7,925 | 69,062 | |||||||||||||||||
| Interest expense | 77,647 | 33,030 | 110,677 | |||||||||||||||||
| Other expenses | 7,587 | (66) | 7,521 | |||||||||||||||||
| Income taxes | 76,207 | (2,855) | 73,352 | |||||||||||||||||
| Preferred dividend requirements of subsidiaries and noncontrolling interests | 630 | — | 630 | |||||||||||||||||
| 2026 Net Income (Loss) Attributable to Entergy Corporation | $1,079,384 | ($139,069) | $940,315 | |||||||||||||||||
(a)Parent & Other includes eliminations, which are primarily intersegment activity.
Operating Revenues
Utility
Following is an analysis of the change in operating revenues comparing the third quarter 2026 to the third quarter 2025:
| Amount | |||||
| (In Millions) | |||||
| 2025 operating revenues | $3,797 | ||||
| Fuel, rider, and other revenues that do not significantly affect net income | 117 | ||||
| Retail electric price | 206 | ||||
| Volume/weather | 196 | ||||
| Return on construction work in progress for certain utility plant investments | 52 | ||||
| Purchased power agreement termination proceeds | (15) | ||||
| 2026 operating revenues | $4,353 | ||||
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Entergy Corporation and Subsidiaries
Management’s Financial Discussion and Analysis
The Utility operating companies’ results include revenues from rate mechanisms designed to recover fuel, purchased power, and other costs such that the revenues and expenses associated with these items generally offset and do not affect net income. “Fuel, rider, and other revenues that do not significantly affect net income” includes the revenue variance associated with these items.
The retail electric price variance is primarily due to:
•an increase in formula rate plan rates effective January 2026 and the implementation of the Generating Arkansas Jobs Act rider effective June 2026, each at Entergy Arkansas;
•an increase in formula rate plan rates effective September 2026, a decrease in formula rate plan revenues for a two-month period beginning September 2025 resulting from earnings above the authorized return on common equity for the 2024 test year, and increases in the resilience plan cost recovery rider effective March 2026 and September 2026, each at Entergy Louisiana;
•an increase in Entergy Mississippi’s formula rate plan rates resulting from an increase in interim facilities rate adjustment revenues effective January 2026; and
•increases in the distribution cost recovery factor rider effective December 2025 and July 2026 and an increase in the transmission cost recovery factor rider effective April 2026, each at Entergy Texas.
See Note 2 to the financial statements herein and in the Form 10-K for discussion of the regulatory proceedings discussed above.
The volume/weather variance is primarily due to the effect of more favorable weather on residential and commercial sales, an increase in weather-adjusted residential and commercial usage, and an increase in industrial usage. The increase in industrial usage is primarily due to an increase in demand from large industrial customers, primarily data center and primary metals customers.
The return on construction work in progress for certain utility plant investments variance represents the revenue related to the amortization of certain customer advances designed to provide a return on investment in construction work in progress for certain utility plant investments, which is recognized as the related construction costs are incurred.
The purchased power agreement termination proceeds variance represents $15 million of liquidated damages recognized by Entergy Mississippi in third quarter 2025 resulting from a counterparty’s termination of a purchased power agreement.
Total electric energy sales for Utility for the three months ended September 30, 2026 and 2025 are as follows:
| 2026 | 2025 | % Change | |||||||||||||||
| (GWh) | |||||||||||||||||
| Residential | 13,163 | 11,692 | 13 | ||||||||||||||
| Commercial | 8,973 | 8,499 | 6 | ||||||||||||||
| Industrial | 17,055 | 16,255 | 5 | ||||||||||||||
| Governmental | 673 | 678 | (1) | ||||||||||||||
| Total retail | 39,864 | 37,124 | 7 | ||||||||||||||
| Sales for resale | 3,528 | 4,079 | (14) | ||||||||||||||
| Total | 43,392 | 41,203 | 5 | ||||||||||||||
See Note 12 to the financial statements herein for additional discussion of operating revenues.
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Entergy Corporation and Subsidiaries
Management’s Financial Discussion and Analysis
Other Income Statement Items
Utility
Other operation and maintenance expenses increased from $764 million for the third quarter 2025 to $825 million for the third quarter 2026 primarily due to:
•an increase of $14 million in power delivery expenses primarily due to higher vegetation maintenance costs;
•a $13 million gain, recorded in third quarter 2025, resulting from the sale of the Entergy Louisiana and Entergy New Orleans natural gas distribution businesses on July 1, 2025, which included the derecognition of $7 million of goodwill attributed to the businesses sold. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy Louisiana and Entergy New Orleans natural gas distribution businesses on July 1, 2025;
•an increase of $11 million in non-nuclear generation expenses primarily due to a higher scope of work performed, including during plant outages, in 2026 as compared to 2025;
•an increase of $8 million in compensation and benefits costs primarily due to higher healthcare claims activity;
•an increase of $7 million in energy efficiency expenses primarily due to the timing of recovery from customers; and
•several individually insignificant items.
The increase was partially offset by the expensing of $11 million at Entergy Louisiana of project costs associated with the Bayou Power Station project following Entergy Louisiana’s election in third quarter 2025 to cancel the project and evaluate an alternative transmission solution. See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Liquidity and Capital Resources” in the Form 10-K for discussion of Entergy Louisiana’s Bayou Power Station project.
Asset write-offs, impairments, and related charges includes a $13 million charge, recorded in third quarter 2025 at Entergy New Orleans, to reflect the write-off of retained natural gas plant assets that were not included in the sale of Entergy New Orleans’s natural gas distribution business on July 1, 2025, and which will not be recovered from customers. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of Entergy New Orleans’s natural gas distribution business on July 1, 2025.
Depreciation and amortization expenses increased primarily due to additions to plant in service, an increase in FERC jurisdictional depreciation rates at Entergy Arkansas and Entergy Louisiana effective January 2026, and increases in nuclear depreciation rates at Entergy Louisiana effective September 2025 and September 2026 in accordance with the global stipulated settlement agreement approved by the LPSC in August 2024. See Note 2 to the financial statements in the Form 10-K for discussion of the Entergy Louisiana global stipulated settlement agreement.
Entergy records a regulatory charge or credit for the difference between asset retirement obligation-related expenses and nuclear decommissioning trust earnings plus asset retirement obligation-related costs collected in revenue.
Other income increased primarily due to an increase of $23 million in interest earned on money pool investments and an increase of $23 million in the amortization of tax gross-up on customer advances, including customer advances for construction.
Interest expense increased primarily due to:
•the issuances by Entergy Arkansas of $500 million of 5.75% Series mortgage bonds and $500 million of 4.95% Series mortgage bonds, each in January 2026;
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Management’s Financial Discussion and Analysis
•the issuances by Entergy Louisiana of $750 million of 5.65% Series mortgage bonds and $750 million of 4.90% Series mortgage bonds, each in February 2026;
•the issuances by Entergy Louisiana of $500 million of 5.50% Series mortgage bonds and $500 million of 6.20% Series mortgage bonds, each in August 2026;
•the issuance by Entergy Mississippi of $650 million of 5.05% Series mortgage bonds in March 2026;
•the issuance by Entergy Texas of $425 million of 5.20% Series mortgage bonds in May 2026;
•an increase of $24 million in carrying costs on customer advances, including customer advances for construction; and
•$8 million in carrying costs in third quarter 2026 on retained net proceeds from the monetization of nuclear production tax credits.
The increase was partially offset by the repayment by Entergy Arkansas of $600 million of 3.5% Series mortgage bonds in February 2026.
Parent and Other
Interest expense increased primarily due to the issuances of junior subordinated debentures totaling $1.3 billion in November 2025 and the issuances of junior subordinated debentures totaling $1.5 billion in August 2026.
Income Taxes
The effective income tax rate was 22.8% for the third quarter 2026. The difference in the effective income tax rate for the third quarter 2026 versus the federal statutory rate of 21% was primarily due to the accrual for state income taxes and a provision for uncertain tax positions, partially offset by book and tax differences related to the allowance for equity funds used during construction, the amortization of excess accumulated deferred income taxes, and certain book and tax differences related to utility plant items.
The effective income tax rate was 22.7% for the third quarter 2025. The difference in the effective income tax rate for the third quarter 2025 versus the federal statutory rate of 21% was primarily due to the accrual for state income taxes, partially offset by book and tax differences related to the allowance for equity funds used during construction and certain book and tax differences related to utility plant items.
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Entergy Corporation and Subsidiaries
Management’s Financial Discussion and Analysis
Nine Months Ended September 30, 2026 Compared to Nine Months Ended September 30, 2025
Following are income statement variances for Utility, Parent & Other, and Entergy comparing the nine months ended September 30, 2026 to the nine months ended September 30, 2025 showing how much the line item increased or (decreased) in comparison to the prior period.
Utility | Parent & Other (a) | Entergy | ||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||
| 2025 Net Income (Loss) Attributable to Entergy Corporation | $1,898,989 | ($376,499) | $1,522,490 | |||||||||||||||||
| Operating revenues | 1,094,012 | (5,322) | 1,088,690 | |||||||||||||||||
| Fuel, fuel-related expenses, and gas purchased for resale | 297,234 | (4,144) | 293,090 | |||||||||||||||||
| Purchased power | 141,389 | 1,310 | 142,699 | |||||||||||||||||
| Other regulatory charges (credits) - net | 179,586 | — | 179,586 | |||||||||||||||||
| Other operation and maintenance | 106,703 | 2,863 | 109,566 | |||||||||||||||||
Asset write-offs, impairments, and related charges | (12,795) | 18,059 | 5,264 | |||||||||||||||||
| Taxes other than income taxes | 29,898 | (391) | 29,507 | |||||||||||||||||
| Depreciation and amortization | 81,225 | (2,427) | 78,798 | |||||||||||||||||
| Other income (deductions) | 335,293 | 12,392 | 347,685 | |||||||||||||||||
| Interest expense | 181,180 | 67,625 | 248,805 | |||||||||||||||||
| Other expenses | 3,361 | (75) | 3,286 | |||||||||||||||||
| Income taxes | 69,426 | (15,046) | 54,380 | |||||||||||||||||
| Preferred dividend requirements of subsidiaries and noncontrolling interests | 6,046 | — | 6,046 | |||||||||||||||||
| 2026 Net Income (Loss) Attributable to Entergy Corporation | $2,245,041 | ($437,203) | $1,807,838 | |||||||||||||||||
(a)Parent & Other includes eliminations, which are primarily intersegment activity.
Operating Revenues
Utility
Following is an analysis of the change in operating revenues comparing the nine months ended September 30, 2026 to the nine months ended September 30, 2025:
| Amount | |||||
| (In Millions) | |||||
| 2025 operating revenues | $9,943 | ||||
| Fuel, rider, and other revenues that do not significantly affect net income | 539 | ||||
| Retail electric price | 348 | ||||
| Volume/weather | 213 | ||||
| Return on construction work in progress for certain utility plant investments | 122 | ||||
| Purchased power agreement termination proceeds | (15) | ||||
| Effect of sale of natural gas distribution businesses | (113) | ||||
| 2026 operating revenues | $11,037 | ||||
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Management’s Financial Discussion and Analysis
The Utility operating companies’ results include revenues from rate mechanisms designed to recover fuel, purchased power, and other costs such that the revenues and expenses associated with these items generally offset and do not affect net income. “Fuel, rider, and other revenues that do not significantly affect net income” includes the revenue variance associated with these items.
The retail electric price variance is primarily due to:
•an increase in formula rate plan rates effective January 2026 and the implementation of the Generating Arkansas Jobs Act rider effective June 2026, each at Entergy Arkansas;
•an increase in formula rate plan rates effective September 2026, a decrease in formula rate plan revenues for a two-month period beginning September 2025 resulting from earnings above the authorized return on common equity for the 2024 test year, and increases in the resilience plan cost recovery rider effective March 2025, March 2026, and September 2026, each at Entergy Louisiana;
•an increase in Entergy Mississippi’s formula rate plan rates resulting from an increase in interim facilities rate adjustment revenues effective January 2026; and
•increases in the distribution cost recovery factor rider effective June 2025, December 2025, and July 2026 and an increase in the transmission cost recovery factor rider effective April 2026, each at Entergy Texas.
See Note 2 to the financial statements herein and in the Form 10-K for discussion of the regulatory proceedings discussed above.
The volume/weather variance is primarily due to increases in industrial and residential usage and the effect of more favorable weather on commercial sales. The increase in industrial usage is primarily due to an increase in demand from large industrial customers, primarily data center, primary metals, and transportation customers.
The return on construction work in progress for certain utility plant investments variance represents the revenue related to the amortization of certain customer advances designed to provide a return on investment in construction work in progress for certain utility plant investments, which is recognized as the related construction costs are incurred.
The purchased power agreement termination proceeds variance represents $15 million of liquidated damages recognized by Entergy Mississippi in third quarter 2025 resulting from a counterparty’s termination of a purchased power agreement.
The effect of sale of natural gas distribution businesses variance represents the decrease in operating revenues resulting from the absence of natural gas revenues at Entergy Louisiana and Entergy New Orleans following the sale of the Entergy Louisiana and Entergy New Orleans natural gas distribution businesses on July 1, 2025. The decrease in natural gas operating revenues is substantially offset in net income by the absence of operating expenses related to the Entergy Louisiana and Entergy New Orleans natural gas distribution businesses following the sale. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy Louisiana and Entergy New Orleans natural gas distribution businesses on July 1, 2025.
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Entergy Corporation and Subsidiaries
Management’s Financial Discussion and Analysis
Total electric energy sales for Utility for the nine months ended September 30, 2026 and 2025 are as follows:
| 2026 | 2025 | % Change | |||||||||||||||
| (GWh) | |||||||||||||||||
| Residential | 29,955 | 29,376 | 2 | ||||||||||||||
| Commercial | 22,410 | 22,007 | 2 | ||||||||||||||
| Industrial | 50,114 | 45,707 | 10 | ||||||||||||||
| Governmental | 1,846 | 1,853 | — | ||||||||||||||
| Total retail | 104,325 | 98,943 | 5 | ||||||||||||||
| Sales for resale | 9,655 | 9,847 | (2) | ||||||||||||||
| Total | 113,980 | 108,790 | 5 | ||||||||||||||
See Note 12 to the financial statements herein for additional discussion of operating revenues.
Other Income Statement Items
Utility
Purchased power includes:
•$27 million of higher unrecovered costs in 2025, at Entergy Texas, related to the procurement of capacity through MISO’s annual planning resource auction. Higher costs in 2025 resulted from the effect of a significant increase in MISO’s seasonal auction clearing price, due to the implementation of a reliability-based demand curve, for capacity transactions during the summer months in 2025. Prior to June 2026, Entergy Texas also did not have the ability to recover its MISO capacity costs incurred to date beyond the level included in base rates. In June 2025, Texas legislation established a capacity cost recovery rider mechanism that would allow for the recovery of costs related to the procurement of capacity through MISO’s annual planning resource auction outside of base rates, through a rider that is updated annually. In May 2026, Entergy Texas filed a request with the PUCT for a capacity cost recovery rider to recover eligible capacity procurement costs associated with its participation in MISO’s annual planning resource auction, and the PUCT approved the request in July 2026. See Note 2 to the financial statements herein for discussion of Entergy Texas’s capacity cost recovery rider; and
•$19 million of unrecovered capacity cost charges in 2026, at Entergy Texas, under a new short-term, one-year power purchase agreement beginning in June 2026.
Other operation and maintenance expenses increased from $2,140 million for the nine months ended September 30, 2025 to $2,246 million for the nine months ended September 30, 2026 primarily due to:
•an increase of $48 million in power delivery expenses primarily due to higher vegetation maintenance costs and increased contract labor costs;
•an increase of $28 million in compensation and benefits costs primarily due to higher healthcare claims activity, the timing of recognition of prescription drug rebates, and a larger revision to estimated incentive-based compensation expense in 2025;
•a $13 million gain, recorded in third quarter 2025, resulting from the sale of the Entergy Louisiana and Entergy New Orleans natural gas distribution businesses on July 1, 2025, which included the derecognition of $7 million of goodwill attributed to the businesses sold. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy Louisiana and Entergy New Orleans natural gas distribution businesses on July 1, 2025; and
•several individually insignificant items.
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Management’s Financial Discussion and Analysis
The increase was partially offset by a decrease of $20 million in insurance expense primarily due to higher nuclear insurance refunds.
Asset write-offs, impairments, and related charges includes a $13 million charge, recorded in third quarter 2025 at Entergy New Orleans, to reflect the write-off of retained natural gas plant assets that were not included in the sale of Entergy New Orleans’s natural gas distribution business on July 1, 2025, and which will not be recovered from customers. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of Entergy New Orleans’s natural gas distribution business on July 1, 2025.
Taxes other than income taxes increased primarily due to increases in ad valorem taxes resulting from higher assessments.
Depreciation and amortization expenses increased primarily due to additions to plant in service, an increase in FERC jurisdictional depreciation rates at Entergy Arkansas and Entergy Louisiana effective January 2026, and increases in nuclear depreciation rates at Entergy Louisiana effective September 2025 and September 2026 in accordance with the global stipulated settlement agreement approved by the LPSC in August 2024. See Note 2 to the financial statements in the Form 10-K for discussion of the Entergy Louisiana global stipulated settlement agreement.
Entergy records a regulatory charge or credit for the difference between asset retirement obligation-related expenses and nuclear decommissioning trust earnings plus asset retirement obligation-related costs collected in revenue.
Other income increased primarily due to:
•changes in decommissioning trust fund activity, including portfolio rebalancing of decommissioning trust funds in 2026;
•an increase of $61 million in the amortization of tax gross-up on customer advances, including customer advances for construction;
•an increase of $50 million in interest earned on money pool investments; and
•an increase in the allowance for equity funds used during construction due to higher construction work in progress in 2026, including the Orange County Advanced Power Station project and the Lone Star Power Station project, each at Entergy Texas. The increase was partially offset by lower construction work in progress in 2026 on the Legend Power Station project as a result of the sale of assets related to the in-process project in December 2025, at Entergy Texas. See Note 8 to the financial statements in the Form 10-K for discussion of the Entergy Texas build-to-suit lease arrangement for the Legend Power Station.
The increase was partially offset by:
•a $17 million true-up, recorded in second quarter 2025, of Entergy Louisiana’s MISO cost recovery mechanism over-recovery balance to the 2024 formula rate plan filing, which was filed with the LPSC in May 2025. See Note 2 to the financial statements in the Form 10-K for discussion of the 2024 formula rate plan filing; and
•a decrease of $14 million in intercompany dividend income from affiliated preferred membership interests related to storm cost securitization. The intercompany dividend income from the affiliated preferred membership interests is eliminated for consolidation purposes and has no effect on net income since the investment is in another Entergy subsidiary. See Note 2 to the financial statements in the Form 10-K for discussion of Entergy Louisiana’s storm cost securitizations.
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Entergy Corporation and Subsidiaries
Management’s Financial Discussion and Analysis
Interest expense increased primarily due to:
•the issuances by Entergy Arkansas of $500 million of 5.75% Series mortgage bonds and $500 million of 4.95% Series mortgage bonds, each in January 2026;
•the issuance by Entergy Arkansas of $300 million of 5.45% Series mortgage bonds in May 2025;
•the issuances by Entergy Louisiana of $750 million of 5.65% Series mortgage bonds and $750 million of 4.90% Series mortgage bonds, each in February 2026;
•the issuances by Entergy Louisiana of $500 million of 5.50% Series mortgage bonds and $500 million of 6.20% Series mortgage bonds, each in August 2026;
•the issuance by Entergy Mississippi of $650 million of 5.05% Series mortgage bonds in March 2026;
•the issuance by Entergy Mississippi of $600 million of 5.80% Series mortgage bonds in March 2025;
•the issuance by Entergy Texas of $500 million of 5.25% Series mortgage bonds in February 2025;
•the issuance by Entergy Texas of $425 million of 5.20% Series mortgage bonds in May 2026;
•the issuance by System Energy of $240 million of 5.30% Series mortgage bonds in May 2025;
•an increase of $46 million in carrying costs on customer advances, including customer advances for construction; and
•$25 million in carrying costs in 2026 on retained net proceeds from the monetization of nuclear production tax credits.
The increase was partially offset by the repayment by Entergy Arkansas of $600 million of 3.5% Series mortgage bonds in February 2026 and the repayment by Entergy Louisiana of $250 million of 4.44% Series mortgage bonds in January 2026.
Parent and Other
Asset write-offs, impairments, and related charges includes an $18 million non-cash impairment charge recognized in first quarter 2026 related to the sale of the non-utility operations businesses’ interest in the Independence power plant in April 2026.
Other income (deductions) increased primarily due to a decrease of $14 million in the amount of the elimination for consolidation purposes of intercompany dividend income from affiliated preferred membership interests, as discussed above.
Interest expense increased primarily due to the issuances of junior subordinated debentures totaling $1.3 billion in November 2025 and the issuances of junior subordinated debentures totaling $1.5 billion in August 2026.
Income Taxes
The effective income tax rate was 21.4% for the nine months ended September 30, 2026. The difference in the effective income tax rate for the nine months ended September 30, 2026 versus the federal statutory rate of 21% was primarily due to the accrual for state income taxes, partially offset by book and tax differences related to the allowance for equity funds used during construction, certain book and tax differences related to utility plant items, and the amortization of excess accumulated deferred income taxes.
The effective income tax rate was 22.5% for the nine months ended September 30, 2025. The difference in the effective income tax rate for the nine months ended September 30, 2025 versus the federal statutory rate of 21% was primarily due to the accrual for state income taxes, partially offset by book and tax differences related to the allowance for equity funds used during construction and certain book and tax differences related to utility plant items.
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Entergy Corporation and Subsidiaries
Management’s Financial Discussion and Analysis
Income Tax Legislation and Regulation
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Income Tax Legislation and Regulation” in the Form 10-K for discussion of income tax legislation and regulation.
Liquidity and Capital Resources
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Liquidity and Capital Resources” in the Form 10-K for a discussion of Entergy’s capital structure, capital spending plans and other uses of capital, and sources of capital.
Capital Structure and Resources
Entergy’s debt to capital ratio is shown in the following table.
| September 30, 2026 | December 31, 2025 | ||||||||||
| Debt to capital | 63.5 | % | 64.3 | % | |||||||
| Effect of excluding securitization bonds | (0.2 | %) | (0.2 | %) | |||||||
| Debt to capital, excluding securitization bonds (non-GAAP) (a) | 63.3 | % | 64.1 | % | |||||||
| Effect of subtracting cash | (3.0 | %) | (1.5 | %) | |||||||
| Net debt to net capital, excluding securitization bonds (non-GAAP) (a) | 60.3 | % | 62.6 | % | |||||||
(a)Calculation excludes the Texas securitization bonds, which are non-recourse to Entergy Texas.
As of September 30, 2026, 18.7% of the debt outstanding is at the parent company, Entergy Corporation, and 81.3% is at the Utility segment. Net debt consists of debt less cash and cash equivalents. Debt consists of notes payable and commercial paper, finance lease obligations, and long-term debt, including the currently maturing portion. Capital consists of debt, equity, and subsidiaries’ preferred stock without sinking fund. Net capital consists of capital less cash and cash equivalents. The debt to capital ratio excluding securitization bonds and net debt to net capital ratio excluding securitization bonds are non-GAAP measures. Entergy uses the debt to capital ratios excluding securitization bonds in analyzing its financial condition and believes they provide useful information to its investors and creditors in evaluating Entergy’s financial condition because the securitization bonds are non-recourse to Entergy, as more fully described in Note 5 to the financial statements in the Form 10-K. Entergy also uses the net debt to net capital ratio excluding securitization bonds in analyzing its financial condition and believes it provides useful information to its investors and creditors in evaluating Entergy’s financial condition because net debt indicates Entergy’s outstanding debt position that could not be readily satisfied by cash and cash equivalents on hand.
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Entergy Corporation has in place a credit facility that has a borrowing capacity of $3 billion and expires in June 2031. The facility includes fronting commitments for the issuance of letters of credit against $20 million of the total borrowing capacity of the credit facility. The commitment fee is currently 0.225% of the undrawn commitment amount. Commitment fees and interest rates on loans under the credit facility can fluctuate depending on the senior unsecured debt ratings of Entergy Corporation. Although there were no borrowings under the facility for the nine months ended September 30, 2026, the estimated interest rate as of September 30, 2026 that would have been applied to outstanding borrowings under the facility was 5.40%. The following is a summary of the amounts outstanding and capacity available under the credit facility as of September 30, 2026:
| Capacity | Borrowings | Letters of Credit | Capacity Available | |||||||||||||||||
| (In Millions) | ||||||||||||||||||||
| $3,000 | $— | $3 | $2,997 | |||||||||||||||||
Entergy Corporation’s credit facility includes a covenant requiring Entergy to maintain a consolidated debt ratio, as defined, of 65% or less of its total capitalization. The calculation of this debt ratio under Entergy Corporation’s credit facility is different than the calculation of the debt to capital ratio above. Entergy is currently in compliance with the covenant and expects to remain in compliance with this covenant. If Entergy fails to meet this ratio, or if Entergy Corporation or one of the Registrant Subsidiaries (except Entergy New Orleans and System Energy) defaults on other indebtedness or is in bankruptcy or insolvency proceedings, an acceleration of the Entergy Corporation credit facility’s maturity date may occur. See Note 4 to the financial statements herein for additional discussion of the Entergy Corporation credit facility and discussion of the Registrant Subsidiaries’ credit facilities.
Entergy Corporation has a commercial paper program with a Board-approved program limit of $2 billion. As of September 30, 2026, Entergy Corporation had $105 million of commercial paper outstanding. The weighted-average interest rate for the nine months ended September 30, 2026 was 4.05%.
Equity Issuances and Equity Distribution Program
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Liquidity and Capital Resources - Sources of Capital - Equity Issuances and Equity Distribution Program” in the Form 10-K and Note 3 to the financial statements herein for discussion of equity issuances, the equity distribution program, and equity forward sale agreements. The following are updates to that discussion.
In February 2026, Entergy Corporation physically settled a portion of its obligations under certain of its then-outstanding forward sale agreements under its at the market equity distribution program for cash proceeds of $346 million.
In May 2026, Entergy Corporation marketed an equity offering of approximately 19.2 million shares of Entergy Corporation common stock. In lieu of issuing equity at the time of the offering, Entergy Corporation entered into forward sale agreements with several forward counterparties. The forward sale agreements require Entergy Corporation to, at its election on or prior to April 30, 2028, either (1) physically settle the transactions by issuing the total of approximately 19.2 million shares of its common stock to the forward counterparties in exchange for net proceeds at the then-applicable forward sale price specified by the agreements (initially $110.74 per share) or (2) net settle the transactions in whole or in part through the delivery or receipt of cash or shares. The forward sale price is subject to adjustment on a daily basis based on a floating interest rate factor and will decrease by other fixed amounts specified in the agreements.
In June 2026, Entergy Corporation physically settled its remaining obligations under certain of its then-outstanding forward sale agreements under its at the market equity distribution program for cash proceeds of $126 million and physically settled a portion of its obligations under certain of its then-outstanding equity forward sale agreements for cash proceeds of $546 million.
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In September 2026, Entergy Corporation physically settled its remaining obligations under certain of its then-outstanding equity forward sale agreements for cash proceeds of $913 million.
Entergy Corporation currently expects to issue approximately $5.2 billion of equity from 2027 through 2030, which it may issue under its at the market equity distribution program or otherwise, with approximately $2.2 billion already contracted under forward sale agreements as of September 30, 2026.
Winter Storm Fern (Entergy Mississippi)
In January 2026, Entergy Mississippi’s service territory experienced the effects of Winter Storm Fern, including prolonged freezing temperatures, heavy ice accumulations, and wind, which caused severe damage to Entergy Mississippi’s infrastructure. Following Winter Storm Fern, the “Mississippi 2026 Severe Winter Storm Electric Utility Customer Relief and Electric Utility System Restoration Act” was enacted by the Mississippi Legislature in April 2026. This legislation provides that the MPSC may issue an electric utility financing order authorizing the issuance of system restoration bonds, the proceeds of which shall be used to securitize the system restoration costs and storm damage reserve levels of those utilities affected by Winter Storm Fern. The legislation requires that an electric utility affected by the storm must first petition the MPSC for such a financing order that complies with the requirements outlined in the legislation. The legislation states that any system restoration bonds issued under a financing order will not be considered debt of the electric utility. These bonds will only be secured by the system restoration property specified in the financing order.
In October 2026, Entergy Mississippi filed a petition with the MPSC requesting an electric utility financing order authorizing the Mississippi State Bond Commission to act as the issuing agent for the State of Mississippi to issue system restoration bonds, the proceeds of which would be used by Entergy Mississippi to securitize approximately $237.8 million in total Winter Storm Fern system restoration costs, consisting of $145.7 million in non-fuel system restoration costs, $65.0 million in incremental fuel costs attributable to Winter Storm Fern, $7.6 million in retired damaged assets, $14.3 million in carrying costs estimated through the date of bond issuance, and $5.2 million in bond issuance costs and financing costs. Within the petition, Entergy Mississippi also requested that the MPSC find that the non-fuel system restoration costs and incremental fuel costs attributable to Winter Storm Fern were prudently incurred. The MPSC is expected to rule on the petition in December 2026.
Entergy Louisiana Build-to-Suit Lease Arrangement for the Waterford 6 Power Station
In October 2026, Entergy Louisiana entered a build-to-suit lease arrangement for the Waterford 6 Power Station as the lessee with a consortium of investors (the Investors). Under the terms of the arrangement, the Investors purchased the in-process Waterford 6 Power Station construction project from Entergy Louisiana at a cost of $167.5 million and will spend up to $1.875 billion (including the initial purchase price) to construct the Waterford 6 project as designed by Entergy Louisiana. Entergy Louisiana is engaged to serve as the construction agent for the Waterford 6 Power Station project. The Investors, however, control the asset during construction. If Entergy Louisiana defaults in its role as construction agent, the Investors have various options available to remedy the default, including the replacement of Entergy Louisiana as construction agent, the acceleration of the lease balance payable by Entergy Louisiana, causing a sale of the Waterford 6 Power Station project to a third party, and certain other options. If the LPSC rejects the Waterford 6 Power Station project or certain other circumstances occur that are outside of Entergy Louisiana’s control, then either the Investors or Entergy Louisiana could exercise the right to terminate the arrangement, in which case Entergy Louisiana would be required to purchase the in-process Waterford 6 Power Station project from the Investors at an amount equal to their costs incurred to date, including carrying costs. Because Entergy Louisiana does not control the in-process construction project, it will not recognize the asset (i.e., construction work in progress) or an associated liability during construction.
Upon the Waterford 6 Power Station’s readiness for first synchronization to the grid, expected in late 2029, a triple-net lease will commence under which Entergy Louisiana will have control of the Waterford 6 Power Station
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and receive all output from the plant. The initial term of the lease will end seven years from the closing of the arrangement, or approximately four years after the Waterford 6 Power Station’s expected readiness for first synchronization to the grid. The lease cost will be equal to the Secured Overnight Financing Rate plus a margin which is based on the credit rating of Entergy Louisiana, multiplied by the total costs (including carrying costs) incurred by the Investors as of the commencement of the lease. Entergy Louisiana will have the option to purchase the Waterford 6 Power Station at any time during the lease term at a price equal to the total cost of the plant to the Investors, plus any fees and carrying charges owed to the Investors. If the purchase price option is exercised within two years of commencement of the triple-net lease, Entergy Louisiana must enter into a secured note payable to the Investors for the amount of the purchase price. The note payable would be due at the end of the initial lease term, but may be prepaid at any time beginning two years after the commencement date of the lease. The note will be secured by the Waterford 6 Power Station and related equipment and collateral.
At the end of the initial lease term, Entergy Louisiana must exercise one of the following options: (1) renew the lease for an additional five year term, subject to unanimous consent of the Investors; (2) purchase the plant at a price equal to the total cost of the plant to Investors, plus any fees and carrying charges owed to the Investors; or (3) sell the plant on behalf of the Investors. If Entergy Louisiana chooses the third option, then it will owe or be owed any difference between the total cost of the plant to Investors and the sale price.
Capital Expenditure Plans and Other Uses of Capital
See the table and discussion in the Form 10-K under “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Liquidity and Capital Resources - Capital Expenditure Plans and Other Uses of Capital,” that sets forth the amounts of Entergy’s planned construction and other capital investments for 2026 through 2029. The following are updates to that discussion.
Entergy is developing its capital investment plan for 2027 through 2030 and currently anticipates making the following construction and other capital investments during that period:
| Planned construction and capital investments | 2027 | 2028 | 2029 | 2030 | ||||||||||||||||||||||
| (In Millions) (a) | ||||||||||||||||||||||||||
| Generation | $12,115 | $11,735 | $7,830 | $6,185 | ||||||||||||||||||||||
| Transmission | 2,625 | 2,615 | 2,010 | 1,160 | ||||||||||||||||||||||
| Distribution | 2,145 | 1,745 | 1,785 | 1,650 | ||||||||||||||||||||||
| Utility Support | 355 | 275 | 305 | 280 | ||||||||||||||||||||||
| Total | $17,240 | $16,370 | $11,930 | $9,275 | ||||||||||||||||||||||
(a)Amounts exclude expenditures expected to be funded through customer advances for construction.
The capital plan includes amounts Entergy plans to spend on routine capital projects that are necessary to support reliability of its service, equipment, or systems and to support normal customer growth. In addition to routine capital projects, the capital plan also includes amounts Entergy plans to spend on non-routine capital investments for which Entergy is either contractually obligated, has Board approval, or otherwise expects to make to satisfy regulatory or legal requirements. Amounts include the following types of construction and capital investments:
•investments in generation projects to modernize, decarbonize, expand, and diversify the Utility operating companies’ portfolios, as well as to support customer growth, including Ironwood Power Station, Jefferson Power Station, the White Bluff Unit 1 fuel conversion, Arkansas Cypress Solar, Segno Solar, Votaw Solar, Bogalusa West Solar, Cypress Harvest Solar, Franklin Farms Power Station Units 1 and 2, Waterford 5 Power Station, Cottonwood Power Station, Westlake Power Station, Richland Parish Units 1-4, Pointe Coupee Units 1-3, Waterford 6 Power Station, Delta Blues Advanced Power Station, Delta Solar, Penton
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Solar, Traceview Advanced Power Station, Vicksburg Advanced Power Station, Lone Star Power Station, Legend Power Station, battery energy storage systems, and potential construction of additional generation;
•investments in the Utility nuclear fleet;
•transmission spending to improve reliability and resilience while also supporting renewables expansion and customer growth; and
•distribution and Utility support spending to improve reliability, resilience, and customer experience through projects focused on asset renewals and enhancements and grid stability.
Estimated capital expenditures are subject to periodic review and modification and may vary based on the ongoing effects of business restructuring, regulatory constraints and requirements, governmental policies and actions, including trade-related governmental actions, such as tariffs, executive orders, and other measures, including recent Executive Order 14421 relating to protecting United States bulk-power systems from foreign actors (Executive Order 14421) and the August 6, 2026 proclamation issued under Section 232 relating to minimum import prices and tariffs for polysilicon and certain derivative products (the Section 232 Proclamation), environmental regulations, business opportunities, market volatility, economic trends, changes in project plans, and the ability to access capital, including any changes to governmental programs, such as loans, grants, guarantees, and other subsidies. Entergy is not able to predict the effect of potential changes in regulation and law, changes to governmental programs, such as loans, grants, guarantees, and other subsidies, and governmental policies and actions, such as tariffs, executive orders, and other measures, including Executive Order 14421 and the Section 232 Proclamation, on its current and planned capital projects, including project delays, modifications, and cost increases.
Renewables
Entergy Arkansas Special Rate Contract and Arkansas Cypress Solar
As discussed in the Form 10-K, in September 2025, Entergy Arkansas filed an application with the APSC seeking approval of a long-term special rate contract between Altitude Capital, LLC, a subsidiary of Alphabet Inc. (Google) and Entergy Arkansas for the sale of electricity to a new large-scale data center in West Memphis, Arkansas. In December 2025 the APSC issued an order approving the special rate contract but denying the requested ratemaking treatment of Google’s upfront payments and deferring a decision on the treatment under the contract pricing providing for the deferral and amortization of the investment tax credits from the Arkansas Cypress Solar facility (discussed below). Also in December 2025, Entergy Arkansas filed a petition with the APSC regarding these findings, noting that they would require renegotiation of the special rate contract. In January 2026 the APSC issued an order maintaining its position on the ratemaking treatment of Google’s upfront payments but reversing itself on the treatment of the Arkansas Cypress Solar facility investment tax credits and allowing those to be used in the pricing of the Arkansas Cypress Solar facility to Google as provided for in the contract. In October 2026, Entergy Arkansas filed for approval of an amendment to the special rate contract regarding the expansion and acceleration of Google’s project in West Memphis. Subject to APSC approval, investments proposed under the amended contract included a 250 MW battery energy storage system to be located at the Driver Solar facility in Mississippi County, Arkansas (Driver Solar battery energy storage system), a 100 MW battery energy storage system to be located adjacent to the existing Arklahoma substation near the in-progress Ironwood Power Station in Hot Spring County, Arkansas (Jones Mill battery energy storage system), a 440 MW solar power purchase agreement from the Big Island Solar facility, and related transmission upgrades and facilities. A procedural schedule has been set with a hearing scheduled for January 2027.
As discussed in the Form 10-K, in September 2025, Entergy Arkansas filed an application with the APSC seeking a certificate of environmental compatibility and public need for the construction and operation of the Arkansas Cypress Solar facility, a planned 600 MW solar photovoltaic array with a 350 MW battery energy storage system and associated transmission facilities interconnecting at Entergy Arkansas’s White Bluff substation. The estimated cost of the project is $1,602 million. In March 2026 the APSC approved the Arkansas Cypress Solar facility and Entergy Arkansas’s recovery of the costs of the facility through the Generating Arkansas Jobs Act rider. The APSC also ordered implementation of an independent monitor to oversee costs. In April 2026, Entergy
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Arkansas filed with the APSC its proposal for an independent monitor to oversee the reasonableness of costs. In April 2026 the APSC issued an order consolidating Entergy Arkansas’s independent monitor proposals for three pending resources, including the Arkansas Cypress Solar facility, into a single docket and directing parties with full intervention status to respond to the proposals and recommend independent monitor candidates. No alternative recommendations were made by the other parties, and the APSC approved Entergy Arkansas’s independent monitor proposal in September 2026. The facility is expected to be in service by the end of 2028.
In October 2026, Entergy Arkansas filed an application with the APSC seeking a certificate of environmental compatibility and public need for the construction and operation of the Driver Solar battery energy storage system and the Jones Mill battery energy storage system. The battery energy storage systems are being developed to help support the expansion and acceleration of Google’s project in West Memphis. The estimated cost of the Driver Solar battery energy storage system is $389.4 million, and the estimated cost of the Jones Mill battery energy storage system is $161.2 million. Pending receipt of APSC approval, each battery energy storage system is expected to be in service in 2028.
Cypress Harvest Solar
As discussed in the Form 10-K, in February 2026, Entergy Louisiana filed an application seeking LPSC approval and certification for the Cypress Harvest Solar facility, a 200 MW solar facility to be located in Iberville Parish, Louisiana. In March 2026 the LPSC staff filed an affidavit attesting that the Cypress Harvest Solar facility meets the applicable parameters for Entergy Louisiana’s expedited certification process and recommending that the LPSC grant certification. At its April 2026 meeting, the LPSC voted to grant the requested approval and certification, with a written order issued in May 2026. In July 2026 the Iberville Parish Council adopted a two-year moratorium on battery energy storage system development to allow time for further evaluation of the community impacts of the technology. In response to the battery moratorium, Entergy Louisiana is planning to replace the 200 MW battery planned for the Cypress Harvest Solar facility with a 110 MW battery at the Segno Solar facility and a 90 MW battery at the Votaw Solar facility. In both August and September 2026, the Iberville Parish Council voted to deny the permit for the Cypress Harvest Solar facility. In October 2026, Entergy Louisiana filed a petition for declaratory and injunctive relief in the 18th Judicial District Court for the Parish of Iberville challenging the Iberville Parish Council’s failure to comply with the requirements of its solar farm regulation. Entergy Louisiana is evaluating the effect of these recent actions on the Cypress Harvest Solar facility, including on the facility’s scheduled in service date of 2028. As of September 30, 2026, Entergy Louisiana has incurred approximately $30 million of project costs for the Cypress Harvest Solar facility.
Segno Solar and Votaw Solar
As discussed in the Form 10-K, in December 2025, Entergy Louisiana filed an application with the LPSC seeking approval and certification to construct the Segno Solar facility and Votaw Solar facility. The application asks that the LPSC approve, subject to certain ongoing discussions, allocation of the two facilities to a designated renewable resources subscription to Entergy Louisiana’s Rider Geaux Zero, and further asserts that the two solar resources fall below certain breakeven parameters established in connection with the LPSC’s order allowing Entergy Louisiana to procure up to 3 gigawatts of solar resources, thus supporting that the resources should be certified as being in the public interest. The application requested consideration by the LPSC at or before its August 2026 meeting. A procedural schedule was set with a hearing initially scheduled for July 2026. In June 2026, Entergy Louisiana filed an unopposed motion asking that the procedural schedule be suspended to allow for settlement negotiations. The motion was granted and the procedural schedule was suspended. Based on a contractual right exercised by the developer in September 2026, Entergy must elect during the fourth quarter of 2026 whether to (i) purchase the assets included in the development agreement as they exist as of October 30, 2026 or (ii) waive the right to purchase the assets, remove the project from the MISO interconnection queue, and retain any MISO refund. Entergy Louisiana is in discussions with the developer regarding these options as well as considering other options for the continued development of the Votaw Solar facility. Subject to approval by the
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LPSC for each facility and resolution of the development issues at the Votaw Solar facility, each facility is expected to be in service by 2029.
Other Generation and Transmission
Jefferson Power Station
As discussed in the Form 10-K, in August 2025, Entergy Arkansas filed an application with the APSC seeking a certificate of environmental compatibility and public need for the construction and operation of Jefferson Power Station, an approximately 754 MW natural gas-fired combined cycle combustion turbine facility to be located in Jefferson County, Arkansas. The estimated cost of the project is $1,602 million. In January 2026 the APSC issued its order finding that Entergy Arkansas had demonstrated a need for the resource but had not met its burden with respect to supporting the prudence of the costs to construct the resource. The APSC acknowledged that the costs would be greater if Entergy Arkansas waited to pursue the resource. The APSC authorized Entergy Arkansas to proceed with Jefferson Power Station as a strategic investment with estimated costs set at a benchmark, which the APSC erroneously believed reflected the current cost estimate but was, in fact, $90 million below the cost presented. In its January 2026 order, the APSC also approved Entergy Arkansas’s recovery of the costs of constructing Jefferson Power Station through the Generating Arkansas Jobs Act rider. Additionally, in its January 2026 order, the APSC found that Entergy Arkansas should conduct all-source competitive solicitations for future generation additions, with limited exceptions where Entergy Arkansas believes that a specific solicitation should be restricted to a certain resource and provides a detailed explanation to the APSC supporting this belief, which the APSC later determined in its March 2026 order is a narrow exception. In February 2026, Entergy Arkansas filed for rehearing seeking to correct the benchmark. In March 2026 the APSC issued an order denying Entergy Arkansas’s petition and maintained the benchmark, although costs over the benchmark were not found to be disallowed. Also in its March 2026 order, the APSC ordered Entergy Arkansas to submit a draft of an all-source request for proposals within thirty days of the order, which Entergy Arkansas filed in April 2026. Also in March 2026, Entergy Arkansas filed with the APSC its proposal for an independent monitor to oversee the reasonableness of its construction costs, as required by the APSC order. In April 2026 the APSC issued an order consolidating Entergy Arkansas’s cost independent monitor proposals for three pending resources, including Jefferson Power Station, into a single docket and directing parties with full intervention status to respond to the proposals and recommend independent monitor candidates. No alternative recommendations were made by the other parties, and the APSC approved Entergy Arkansas’s independent monitor proposal in September 2026. The facility is expected to be in service by the end of 2029.
White Bluff Unit 1 Fuel Conversion
In August 2026, Entergy Arkansas filed an application with the APSC seeking a certificate of convenience and necessity or, in the alternative, a certificate of environmental compatibility and public need for the conversion of White Bluff Unit 1 to operate on natural gas. White Bluff Unit 1 is one of two coal-burning generating units at the White Bluff Steam Electric Station facility, which provides dispatchable capacity of approximately 1,659 MW. The estimated cost of the project is $301.3 million, which Entergy Arkansas proposes to recover through the Generating Arkansas Jobs Act rider. In September 2026 the APSC general staff filed testimony opposing the conversion, criticizing Entergy Arkansas’s demonstration of need and asserting that a prior APSC order required Entergy Arkansas to have performed a market test on the conversion. Entergy Arkansas filed a motion seeking a declaratory order to gain procedural clarity from the APSC regarding the interpretation of its prior order. In October 2026 the APSC found Entergy Arkansas’s interpretation of the prior order to be correct and granted Entergy Arkansas’s motion for declaratory order. In October 2026, Entergy Arkansas filed rebuttal testimony addressing the APSC general staff’s recommendations and misinterpretation of key forecast and modeling information. The APSC general staff’s surrebuttal testimony was filed in October 2026. Pending receipt of APSC approval, construction is expected to begin in 2028 and continue through mid 2029.
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Entergy Louisiana Additional Generation and Transmission Resources
See the Form 10-K for discussion of Entergy Louisiana’s October 2024 application with the LPSC seeking approval of a variety of generation and transmission resources proposed in connection with establishing service to a new data center to be developed by a subsidiary of Meta Platforms, Inc. in north Louisiana, for which an electric service agreement was previously executed.
In March 2026, Entergy Louisiana entered into an electric service agreement with Evest LLC (Evest), a subsidiary of Meta Platforms, Inc., in connection with establishing service to a second new data center to be developed by Evest in north Louisiana. The obligations pursuant to the agreement will commence following construction of certain transmission facilities needed to serve Evest, and the effectiveness of the agreement is conditioned upon receipt of required governmental approvals, including approval from the LPSC. Also in March 2026, Entergy Louisiana filed an application with the LPSC for certification to construct seven new combined cycle combustion turbine generation resources totaling 5,278 MW at a total cost of approximately $12.9 billion, each of which will be enabled for future carbon capture and storage, and three battery energy storage systems, including two that were originally proposed to be co-located with solar resources at the Cypress Harvest Solar facility in Iberville Parish and the Bogalusa West Solar facility in Washington Parish. The application also seeks approval to construct a new 500 kV transmission line, from West Fork Creek to St. Landry, estimated to cost $1.4 billion, and other related transmission facilities. In response to a two-year battery moratorium enacted by the Iberville Parish Council in July 2026, Entergy Louisiana is planning to replace the 200 MW battery planned for the Cypress Harvest Solar facility with a 110 MW battery at the Segno Solar facility and a 90 MW battery at the Votaw Solar facility. Four of the new combined cycle combustion turbine generation resources are to be located near the customer site in north Louisiana (Richland Parish Units 1-4), while the remaining three units will be located near the existing Big Cajun site in Pointe Coupee Parish (Pointe Coupee Units 1-3). The seven new combined cycle combustion turbine generation resources have various estimated in-service dates in 2030 and 2031. The application also requests certain approvals related to a corporate sustainability agreement with the new customer. The corporate sustainability agreement contemplates the new customer contributing to the costs of the future addition of 2,500 MW of new renewable and energy storage resources, agreements involving nuclear-related efforts and contributions to bill assistance and other programs for low-income residents. Entergy Louisiana anticipates recovering the incremental cost to serve the customer through direct financial contributions from the customer and the revenues it expects to earn under the electric service agreement. The application is pending before the LPSC. At its April 2026 meeting, the LPSC voted to direct the administrative hearings division to adopt a procedural schedule that would allow for LPSC consideration of the matter at its December 2026 meeting, and also to have the administrative hearings division serve as a hearing examiner and compile a record for the LPSC to consider without the issuance of a formal recommendation from the ALJ. Testimony of the LPSC staff and certain intervenors was filed in July 2026 and cross answering testimony of the LPSC staff and certain intervenors was filed in August 2026. Entergy Louisiana’s rebuttal testimony was filed in September 2026. The hearing in this matter took place in October 2026. Ahead of the hearing, Entergy Louisiana reached a settlement with the LPSC staff and one intervenor. The settlement resolves all outstanding issues among Entergy Louisiana, the LPSC staff, and the intervenor and recommends, among other things, that the LPSC certify the proposed resources. An LPSC decision is expected in December 2026.
The electric service agreement and related contracts contain provisions that protect Entergy Louisiana’s current customers in a manner consistent with the LPSC’s Lightning Initiative and Entergy Louisiana’s Fair Share Plus guidelines, which the LPSC and Entergy Louisiana, respectively, developed in response to increased investment in large data centers in Louisiana. The protections include terms requiring the customer to pay Entergy Louisiana’s incremental costs to serve the customer, including through contributions in aid of construction, other advanced payments and minimum monthly bills. The agreements also include specified financial obligations in the event that Evest terminates the contracts early, restructures the project, or in the event of default. These specified financial obligations would be based on Entergy Louisiana’s unrecovered incremental costs to serve Evest at the time of such an event. Evest’s obligations under the electric service agreement and related contracts are secured by various forms of collateral, including a guaranty from Meta Platforms, Inc.
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Finally, the electric service agreement also includes provisions relating to Entergy Louisiana’s performance obligations, including the timely construction of the facilities supporting service to Evest, audit rights for the construction costs supported by Evest, and service standards during the term of the electric service agreement. Entergy Louisiana’s failure to meet one or more of these performance obligations could result in specified financial and/or non-financial penalties. Such penalties would vary based on the nature and severity of the failure, including the potential termination of the electric service agreement.
In June 2026 certain intervenors filed a motion requesting that the LPSC issue a subpoena to Meta Platforms, Inc. to obtain certain information about the data center project, including the level of expected investment, job creation, load characteristics, and other aspects of the project, as well as certain financial information. In July 2026, after briefing and argument, the ALJ issued a ruling granting this motion in part and denying it in part. In July 2026, Meta Platforms, Inc. filed a motion to quash the subpoena and a motion for interlocutory review of the ruling that granted the issuance of the subpoena. Meta Platforms, Inc.’s motion for interlocutory review of the ruling was granted by the LPSC at its August 2026 Business and Executive Session. In September 2026 the intervenors seeking the subpoena filed a Petition for Appeal and Judicial Review or in the Alternative Supervisory Writ naming the LPSC as respondent and seeking judicial review of the LPSC’s decision.
Babel - Webre 500 kV Transmission Project
As discussed in the Form 10-K, in December 2025, Entergy Louisiana filed an application with the LPSC seeking a certificate of public convenience and necessity for a 500 kV transmission project that includes the construction of a new 147-mile Babel to Webre 500 kV transmission line, the reconstruction of the Webre 500 kV switching station in Louisiana, and coordination with Entergy Texas on the construction of an approximately 4-mile 500 kV transmission line in Texas. The project was approved by MISO in the 2025 MISO Transmission Expansion Plan and has an estimated cost of $1,238 million and an estimated in-service date of August 2029. In May 2026 the LPSC staff and the Southern Renewable Energy Association (SREA), an intervenor, filed direct testimony. The LPSC staff’s testimony and SREA’s testimony recommended that the LPSC find the project to be in the public interest and grant certification under the LPSC’s general order on transmission siting. The parties entered into an uncontested stipulated settlement agreement and participated in a settlement hearing in September 2026. The LPSC voted to accept the settlement and approve the project at its October 2026 Business and Executive Session.
Waterford 6 Power Station and Westlake Power Station
As discussed in the Form 10-K, in February 2026, Entergy Louisiana filed an application seeking LPSC approval and certification to construct two 754 MW combined cycle combustion turbine generators, the Waterford 6 Power Station and the Westlake Power Station, to be located at Entergy Louisiana’s existing Waterford site near Killona, Louisiana and existing Roy S. Nelson site in Westlake, Louisiana, respectively. In its application, Entergy Louisiana noted the estimated costs are approximately $2,027 million for the Waterford 6 Power Station and $2,091 million for the Westlake Power Station. The LPSC staff and intervenors in the proceeding filed direct testimony in July 2026. The LPSC staff’s testimony expressed support for the LPSC’s approval of Entergy Louisiana’s proposed new generation projects subject to certain conditions. Certain intervenors oppose such approval. Entergy Louisiana filed rebuttal testimony in September 2026. In October 2026, Entergy Louisiana entered into a third-party financing arrangement for the Waterford 6 Power Station. A hearing was held in October 2026. An LPSC decision is expected in first quarter 2027. Subject to timely approval by the LPSC and receipt of other permits and approvals, the estimated in-service dates for the Waterford 6 Power Station and Westlake Power Station are July 2030 and October 2030, respectively. See Note 1 to the financial statements herein for discussion of the build-to-suit lease arrangement for the Waterford 6 Power Station.
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Cottonwood Power Station
As discussed in the Form 10-K, in December 2025, Entergy Louisiana filed an application seeking LPSC approval and a certificate of convenience and necessity to acquire the Cottonwood combined cycle combustion turbine facility, a 1,263 MW combined cycle facility in Deweyville, Texas that was originally placed in commercial service in 2003. The filing seeks findings from the LPSC that the costs of the acquisition, including the approximately $1.5 billion purchase price and $309.3 million in capital upgrades and maintenance items needed to bring the Cottonwood facility into alignment with Entergy Louisiana’s fleet standards with respect to operations and safety, are eligible for recovery in customer rates. In June 2026 the LPSC staff filed direct testimony raising various concerns and objections to the proposed transaction as presented in Entergy Louisiana’s application. The LPSC staff asserts that the need for the Cottonwood facility is driven predominantly by loads associated with certain large data center projects and opines that the costs and future operational risks of the Cottonwood facility should be borne by these customers in particular, not Entergy Louisiana’s customers generally. The LPSC staff’s direct testimony also raises issues regarding the acquisition premium, potential stranded costs, and future operating risks associated with the Cottonwood facility. Discovery is ongoing, and Entergy Louisiana filed rebuttal testimony in July 2026. A hearing is scheduled for February 2027. The acquisition is currently targeted to close in the first or second quarter of 2027, subject to regulatory approvals and other conditions to closing.
Entergy Mississippi Additional Generation and Transmission Resources
As discussed in the Form 10-K, in March 2024, Entergy Mississippi executed a large customer supply and service agreement to serve two data center campuses located in Madison County, Mississippi in which Amazon Web Services is investing. In February 2025, Entergy Mississippi executed a large customer supply and service agreement to serve a data center campus located in Warren County, Mississippi in which Amazon Web Services is investing. In April 2026, Amazon Web Services announced the expansion of the data center campuses located in Madison County, Mississippi. The February 2025 agreement will apply to this expansion. Also, in April 2026, Entergy Mississippi executed a large customer supply and service agreement to serve a data center campus located in Hinds County, Mississippi in which Amazon Web Services is investing. Consistent with Entergy Mississippi’s Fair Share Plus guidelines, the large customer supply and service agreements are structured to ensure that the customer pays its incremental cost to serve and include protections in the event of early termination.
Cypress to Legend 500 kV Transmission Line
As discussed in the Form 10-K, in May 2025, Entergy Texas filed an application seeking PUCT approval to amend Entergy Texas’s certificate of convenience and necessity to construct, own, and operate a new single-circuit 500 kV transmission line. The transmission line is expected to be approximately 40 to 49 miles in length and the estimated cost of the project ranges from $392.7 million to $436.2 million, depending on the route ultimately approved by the PUCT. In June 2025 the PUCT referred the proceeding to the State Office of Administrative Hearings and a hearing on the merits was held in August 2025. In October 2025 the ALJs with the State Office of Administrative Hearings issued a proposal for decision recommending the PUCT approve Entergy Texas’s application to construct the transmission line and recommending the PUCT’s approval include selection of a specific route with an estimated cost of $398.7 million. In December 2025 the PUCT issued a final order approving the requested amendment to Entergy Texas’s certificate of convenience and necessity to construct, own, and operate the new single-circuit 500 kV transmission line, and selecting the final route previously recommended. In February 2026, landowners not party to the PUCT proceeding filed in the 345th District Court of Travis County, Texas a petition for declaratory relief and temporary and permanent injunction against the PUCT’s final order. The petition, which names the PUCT, its commissioners, and Entergy Texas as defendants, challenges Entergy Texas’s notice, the application of the PUCT’s notice rule, and the PUCT order’s approval of a route the petitioners assert was not adequately noticed. In March 2026, Entergy Texas and the PUCT filed answers disputing all aspects of the petition. In April 2026 petitioners filed an amended petition with minor adjustments to their original petition. In May 2026 petitioners filed a supplemental application for temporary injunction and opposition to pleas to the jurisdiction in response to jurisdictional defenses raised in the answers filed by Entergy Texas and the PUCT. In June 2026 the
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court set a hearing for July 2026 on petitioners’ requested temporary injunction and any pleas to the jurisdiction and motions for summary judgment. In June 2026 the PUCT filed its plea to the jurisdiction. In June 2026 petitioners filed a motion for summary judgment and Entergy Texas filed an amended answer addressing the amended petition, a plea to the jurisdiction, and, in the alternative, a motion for summary judgment. In July 2026 the court issued a written order granting Entergy Texas’s and the PUCT’s pleas to the jurisdiction and, in the alternative, Entergy Texas’s motion for summary judgment. In August 2026 petitioners filed a notice of appeal to the Fifteenth Court of Appeals. In October 2026 the appellate record was filed with the Fifteenth Court of Appeals, triggering a 30-day deadline for the appellants to file a brief on the merits. Also in October 2026, the appellants filed a motion for temporary relief requesting that Entergy Texas be restrained from exercising eminent domain and construction activities on the appellants’ properties. Entergy Texas expects to respond in opposition to the motion for temporary relief by the November 2026 deadline established by the court. Subject to receipt of required permits and other conditions, the project is expected to be in service by the end of 2028.
Dividends
Declarations of dividends on Entergy Corporation common stock are made at the discretion of the Board. Among other things, the Board evaluates the level of Entergy Corporation common stock dividends based upon earnings per share from the Utility segment and the Parent and Other portion of the business, financial strength, and future investment opportunities. In October 2026 the Board declared a dividend of $0.68 per share.
Cash Flow Activity
As shown in Entergy’s Consolidated Statements of Cash Flows, cash flows for the nine months ended September 30, 2026 and 2025 were as follows:
| 2026 | 2025 | ||||||||||
| (In Millions) | |||||||||||
| Cash and cash equivalents at beginning of period | $1,929 | $860 | |||||||||
| Net cash provided by (used in): | |||||||||||
| Operating activities | 4,957 | 3,932 | |||||||||
| Investing activities | (7,841) | (5,211) | |||||||||
| Financing activities | 5,160 | 1,936 | |||||||||
| Net increase in cash and cash equivalents | 2,276 | 657 | |||||||||
| Cash and cash equivalents at end of period | $4,205 | $1,517 | |||||||||
Operating Activities
Net cash flow provided by operating activities increased $1,025 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to an increase of $1,172 million in receipts of advance payments related to customer agreements, including $1,022 million in customer advances and $150 million in tax gross-up on customer advances for construction, and higher collections from Utility customers. The increase was partially offset by:
•the receipt of $224 million in proceeds from the transfer of 2025 nuclear production tax credits to third parties in 2026 as compared to the receipt of $405 million in proceeds from the transfer of 2024 nuclear and solar production tax credits to third parties in 2025. See Note 10 to the financial statements herein and Note 3 to the financial statements in the Form 10-K for discussion of the nuclear and solar production tax credits;
•higher fuel and purchased power payments. See Note 2 to the financial statements herein and in the Form 10-K for a discussion of fuel and purchased power cost recovery;
•the timing of payments to vendors;
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•higher ad valorem tax payments as a result of the timing of payments in 2026 as compared to 2025 and increased assessments in 2026; and
•an increase of $48 million in interest paid.
Investing Activities
Net cash flow used in investing activities increased $2,630 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to:
•an increase of $1,391 million in non-nuclear generation construction expenditures primarily due to higher spending by Entergy Arkansas on the Jefferson Power Station project, the Ironwood Power Station project, and the Arkansas Cypress Solar project, by Entergy Louisiana on the Richland Parish Power Station Units 1-4 project, the Waterford 5 Power Station project, the Westlake Power Station project, the Pointe Coupee Units 1-3 project, and the Waterford 6 Power Station project, and by Entergy Mississippi on the Penton Solar project and the Traceview Advanced Power Station project; partially offset by lower spending by Entergy Texas on the Legend Power Station project as a result of the sale of assets related to the in-process project in December 2025 and lower spending on the Orange County Advanced Power Station project in 2026. See Note 8 to the financial statements in the Form 10-K for discussion of the Entergy Texas build-to-suit lease arrangement for the Legend Power Station;
•the receipt of $491 million in proceeds from the sale of the Entergy Louisiana and Entergy New Orleans natural gas distribution businesses on July 1, 2025. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy Louisiana and Entergy New Orleans natural gas distribution businesses on July 1, 2025;
•an increase of $390 million in transmission construction expenditures primarily due to higher spending by Entergy Louisiana on the Amite South transmission projects and increased spending on various other Utility transmission projects;
•an increase of $181 million in capital expenditures related to storm restoration primarily due to Winter Storm Fern restoration efforts in 2026. See “Winter Storm Fern” above for discussion of storm restoration efforts in 2026;
•an increase of $101 million in nuclear fuel purchases due to variations from year to year in the timing and pricing of fuel reload requirements, materials and services deliveries, and the timing of cash payments during the nuclear fuel cycle;
•an increase of $75 million in distribution construction expenditures primarily due to increased investment in the resilience of the distribution system; and
•payments to storm reserve escrow accounts of $8 million in 2026 compared to net receipts from storm reserve escrow accounts of $34 million in 2025.
The increase was partially offset by:
•cash collateral of $63 million returned by MISO to the Utility operating companies in 2026 as compared to $44 million posted to MISO by the Utility operating companies in 2025. The Utility operating companies have the ability to post cash collateral as a means to support their obligations to MISO and for other purposes; and
•a decrease of $56 million in decommissioning trust fund investment activity.
Financing Activities
Net cash flow provided by financing activities increased $3,224 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to:
•long-term debt activity providing approximately $4,377 million of cash in 2026 compared to providing approximately $1,013 million of cash in 2025;
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•$1,930 million in net proceeds from the issuance of common stock in forward contracts under the at the market equity distribution program and the settlement of equity forward sale agreements in 2026 compared to $805 million in net proceeds from the issuance of common stock under the at the market equity distribution program in 2025; and
•an increase of $132 million in net customer advances for construction related to transmission, distribution, and generator interconnection agreements.
The increase was partially offset by:
•net repayments of $526 million of commercial paper in 2026 as compared to net issuances of $488 million of commercial paper in 2025;
•a $248 million payment by Entergy Texas in June 2026 associated with a financed portion of construction work in progress related to the Orange County Advanced Power Station; and
•an increase of $100 million in common stock dividends paid in 2026 as compared to 2025 as a result of an increase in the dividend paid per share and an increase in the number of shares outstanding.
See Note 3 to the financial statements herein and Note 7 to the financial statements in the Form 10-K for discussion of the equity issuances, the equity distribution program, and the equity forward sale agreements. See Note 4 to the financial statements herein and Notes 4 and 5 to the financial statements in the Form 10-K for details of Entergy’s commercial paper program and long-term debt.
Industrial and Commercial Customers
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS – Industrial and Commercial Customers” in the Form 10-K for a discussion of industrial and commercial customers.
Rate, Cost-recovery, and Other Regulation
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Rate, Cost-recovery, and Other Regulation” in the Form 10-K for discussions of rate regulation, federal regulation, and related regulatory proceedings.
State and Local Rate Regulation and Fuel-Cost Recovery
See Note 2 to the financial statements herein for updates to the discussion in the Form 10-K regarding these proceedings.
Federal Regulation
See Note 2 to the financial statements herein for updates to the discussion in the Form 10-K regarding federal regulatory proceedings.
Market and Credit Risk Sensitive Instruments
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS – Market and Credit Risk Sensitive Instruments” in the Form 10-K for a discussion of market and credit risk sensitive instruments. The following are updates to that discussion.
Some of the agreements to sell the power produced by Entergy’s non-utility operations business contain provisions that require an Entergy subsidiary to provide credit support to secure its obligations under such agreements. The primary form of credit support used to satisfy these requirements is an Entergy Corporation
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guarantee. Cash and letters of credit are also acceptable forms of credit support. As of September 30, 2026, based on power prices at that time, Entergy had $4 million of posted cash collateral.
In addition to the ability to post cash collateral, each of the Utility operating companies has uncommitted standby letter of credit facilities as a means to post collateral to support its obligations to MISO and for other purposes. See Note 4 to the financial statements herein for discussion of these letter of credit facilities. As of September 30, 2026, Entergy Louisiana had $26 million of posted cash collateral, Entergy Mississippi had $6 million of posted cash collateral, and Entergy New Orleans had $1 million of posted cash collateral.
Nuclear Matters
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS – Nuclear Matters” in the Form 10-K for a discussion of nuclear matters. The following are updates to that discussion.
NRC Reactor Oversight Process
The NRC’s Reactor Oversight Process is a program to collect information about plant performance, assess the information for its safety significance, and provide for appropriate licensee and NRC response. The NRC evaluates plant performance by analyzing two distinct inputs: inspection findings resulting from the NRC’s inspection program and performance indicators reported by the licensee. The evaluations result in the placement of each plant in one of the NRC’s Reactor Oversight Process Action Matrix columns: “licensee response column,” or Column 1, “regulatory response column,” or Column 2, “degraded cornerstone column,” or Column 3, “multiple/repetitive degraded cornerstone column,” or Column 4, and “unacceptable performance,” or Column 5. Plants in Column 1 are subject to normal NRC inspection activities. Plants in Column 2, Column 3, or Column 4 are subject to progressively increasing levels of inspection by the NRC with, in general, progressively increasing levels of associated costs. Continued plant operation is not permitted for plants in Column 5. All of the nuclear generating plants owned and operated by Entergy’s Utility business are currently in Column 1, with the exception of Grand Gulf and River Bend, which are in Column 2.
In April 2026 the NRC issued a final significance determination and notice of violation for Grand Gulf, in which it finalized a “white” finding with “low safety significance” related to one of Grand Gulf’s emergency diesel generators, resulting in Grand Gulf’s placement in Column 2, effective first quarter 2026. In September 2026, Grand Gulf successfully completed an NRC supplemental inspection related to the emergency diesel generator issue. The NRC is expected to issue an inspection report in fourth quarter 2026 documenting Grand Gulf’s return to Column 1, effective third quarter 2026.
In August 2026 the NRC issued a final significance determination and notice of violation for River Bend, in which it finalized a “white” finding with “low safety significance” related to one of the service water pumps at River Bend, resulting in River Bend’s placement in Column 2, effective third quarter 2026. River Bend will remain in Column 2 until the satisfactory completion of an NRC supplemental inspection.
Critical Accounting Estimates
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Critical Accounting Estimates” in the Form 10-K for a discussion of the estimates and judgments necessary in Entergy’s accounting for nuclear decommissioning costs, utility regulatory accounting, taxation and uncertain tax positions, qualified pension and other postretirement benefits, and other contingencies.
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New Accounting Pronouncements
See Note 1 to the financial statements in the Form 10-K for discussion of new accounting pronouncements. The following is an update to that discussion.
In May 2026 the FASB issued ASU 2026-02, “Environmental Credits and Environmental Credit Obligations (Topic 818),” which establishes guidance on recognition, measurement, presentation, and disclosure requirements for environmental credits and environmental credit obligations. The ASU requires an entity to recognize an environmental credit as an asset when it is probable that the environmental credit will be (1) used to settle an environmental credit obligation, (2) transferred in an exchange transaction, or (3) used in a nonreciprocal transfer. An environmental credit obligation is required to be recognized when an event occurring on or before the reporting date results in an environmental credit obligation under existing or enacted regulation. The ASU also requires various disclosures related to environmental credits and environmental credit obligations, including how credits are obtained and used, the nature of applicable regulatory compliance programs and related accounting policies, and financial statement impact. ASU 2026-02 is effective for Entergy beginning first quarter 2028. Entergy does not expect ASU 2026-02 to materially affect its results of operations, financial positions, or cash flows.
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| ENTERGY CORPORATION AND SUBSIDIARIES | |||||||||||||||||||||||
| CONSOLIDATED INCOME STATEMENTS | |||||||||||||||||||||||
| For the Three and Nine Months Ended September 30, 2026 and 2025 | |||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| (In Thousands, Except Share Data) | |||||||||||||||||||||||
| OPERATING REVENUES | |||||||||||||||||||||||
| Electric | $ | $ | $ | $ | |||||||||||||||||||
| Natural gas | |||||||||||||||||||||||
| Other | |||||||||||||||||||||||
| TOTAL | |||||||||||||||||||||||
| OPERATING EXPENSES | |||||||||||||||||||||||
| Operation and Maintenance: | |||||||||||||||||||||||
| Fuel, fuel-related expenses, and gas purchased for resale | |||||||||||||||||||||||
| Purchased power | |||||||||||||||||||||||
| Nuclear refueling outage expenses | |||||||||||||||||||||||
| Other operation and maintenance | |||||||||||||||||||||||
| Asset write-offs, impairments, and related charges | |||||||||||||||||||||||
| Decommissioning | |||||||||||||||||||||||
| Taxes other than income taxes | |||||||||||||||||||||||
| Depreciation and amortization | |||||||||||||||||||||||
| Other regulatory charges (credits) - net | ( | ( | ( | ||||||||||||||||||||
| TOTAL | |||||||||||||||||||||||
| OPERATING INCOME | |||||||||||||||||||||||
| OTHER INCOME | |||||||||||||||||||||||
| Allowance for equity funds used during construction | |||||||||||||||||||||||
| Interest and investment income | |||||||||||||||||||||||
| Miscellaneous - net | ( | ( | ( | ||||||||||||||||||||
| TOTAL | |||||||||||||||||||||||
| INTEREST EXPENSE | |||||||||||||||||||||||
| Interest expense | |||||||||||||||||||||||
| Allowance for borrowed funds used during construction | ( | ( | ( | ( | |||||||||||||||||||
| TOTAL | |||||||||||||||||||||||
| INCOME BEFORE INCOME TAXES | |||||||||||||||||||||||
| Income taxes | |||||||||||||||||||||||
| CONSOLIDATED NET INCOME | |||||||||||||||||||||||
| Preferred dividend requirements of subsidiaries and noncontrolling interests | |||||||||||||||||||||||
| NET INCOME ATTRIBUTABLE TO ENTERGY CORPORATION | $ | $ | $ | $ | |||||||||||||||||||
| Earnings per average common share: | |||||||||||||||||||||||
| Basic | $ | $ | $ | $ | |||||||||||||||||||
| Diluted | $ | $ | $ | $ | |||||||||||||||||||
| Basic average number of common shares outstanding | |||||||||||||||||||||||
| Diluted average number of common shares outstanding | |||||||||||||||||||||||
| See Notes to Financial Statements. | |||||||||||||||||||||||
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| ENTERGY CORPORATION AND SUBSIDIARIES | |||||||||||||||||||||||
| CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||||||||||||||||||||||
| For the Three and Nine Months Ended September 30, 2026 and 2025 | |||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| (In Thousands) | |||||||||||||||||||||||
| Net Income | $ | $ | $ | $ | |||||||||||||||||||
| Other comprehensive loss | |||||||||||||||||||||||
Pension and other postretirement plan changes (net of tax benefit of $ | ( | ( | ( | ( | |||||||||||||||||||
| Other comprehensive loss | ( | ( | ( | ( | |||||||||||||||||||
| Comprehensive Income | |||||||||||||||||||||||
| Preferred dividend requirements of subsidiaries and noncontrolling interests | |||||||||||||||||||||||
| Comprehensive Income Attributable to Entergy Corporation | $ | $ | $ | $ | |||||||||||||||||||
| See Notes to Financial Statements. | |||||||||||||||||||||||
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| ENTERGY CORPORATION AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||
| For the Nine Months Ended September 30, 2026 and 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| OPERATING ACTIVITIES | ||||||||||||||
| Consolidated net income | $ | $ | ||||||||||||
| Adjustments to reconcile consolidated net income to net cash flow provided by operating activities: | ||||||||||||||
| Depreciation, amortization, and decommissioning, including nuclear fuel amortization | ||||||||||||||
| Deferred income taxes, tax credits, and non-current taxes accrued | ||||||||||||||
| Asset write-offs, impairments, and related charges | ||||||||||||||
| Changes in working capital: | ||||||||||||||
| Receivables | ( | ( | ||||||||||||
| Fuel inventory | ||||||||||||||
| Accounts payable | ||||||||||||||
| Taxes accrued | ||||||||||||||
| Interest accrued | ||||||||||||||
| Deferred fuel costs | ( | ( | ||||||||||||
Customer advances - current | ||||||||||||||
| Other working capital accounts | ( | ( | ||||||||||||
| Changes in provisions for estimated losses | ( | ( | ||||||||||||
| Changes in other regulatory assets | ||||||||||||||
| Changes in other regulatory liabilities | ( | |||||||||||||
| Changes in customer advances - non-current | ||||||||||||||
| Changes in pension and other postretirement funded status | ( | ( | ||||||||||||
| Other | ( | ( | ||||||||||||
| Net cash flow provided by operating activities | ||||||||||||||
| INVESTING ACTIVITIES | ||||||||||||||
| Construction/capital expenditures | ( | ( | ||||||||||||
| Allowance for equity funds used during construction | ||||||||||||||
| Nuclear fuel purchases | ( | ( | ||||||||||||
| Payment for purchase of plant and assets | ( | ( | ||||||||||||
| Proceeds from sale of business and assets | ||||||||||||||
| Insurance proceeds received for property damages | ||||||||||||||
| Changes in securitization account | ( | ( | ||||||||||||
| Payments to storm reserve escrow accounts | ( | ( | ||||||||||||
| Receipts from storm reserve escrow accounts | ||||||||||||||
| Decrease (increase) in other investments | ( | |||||||||||||
| Litigation proceeds for reimbursement of spent nuclear fuel storage costs | ||||||||||||||
| Proceeds from nuclear decommissioning trust fund sales | ||||||||||||||
| Investment in nuclear decommissioning trust funds | ( | ( | ||||||||||||
| Net cash flow used in investing activities | ( | ( | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| ENTERGY CORPORATION AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||
| For the Nine Months Ended September 30, 2026 and 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| FINANCING ACTIVITIES | ||||||||||||||
| Proceeds from the issuance of: | ||||||||||||||
| Long-term debt | ||||||||||||||
| Treasury stock | ||||||||||||||
| Common stock | ||||||||||||||
| Retirement of long-term debt | ( | ( | ||||||||||||
| Changes in commercial paper - net | ( | |||||||||||||
| Customer advances received for construction | ||||||||||||||
| Customer advances used for construction | ( | ( | ||||||||||||
| Other | ( | ( | ||||||||||||
| Dividends paid: | ||||||||||||||
| Common stock | ( | ( | ||||||||||||
| Preferred stock | ( | ( | ||||||||||||
| Net cash flow provided by financing activities | ||||||||||||||
| Net increase in cash and cash equivalents | ||||||||||||||
| Cash and cash equivalents at beginning of period | ||||||||||||||
| Cash and cash equivalents at end of period | $ | $ | ||||||||||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||||||||||||||
| Cash paid (received) during the period for: | ||||||||||||||
| Interest - net of amount capitalized | $ | $ | ||||||||||||
Income taxes - net (includes proceeds from the transfer of production tax credits to third parties of $ | ($ | ($ | ||||||||||||
| Noncash investing activities: | ||||||||||||||
| Accrued construction expenditures | $ | $ | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| ENTERGY CORPORATION AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||||||||
| ASSETS | ||||||||||||||
| September 30, 2026 and December 31, 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| CURRENT ASSETS | ||||||||||||||
| Cash and cash equivalents: | ||||||||||||||
| Cash | $ | $ | ||||||||||||
| Temporary cash investments | ||||||||||||||
| Total cash and cash equivalents | ||||||||||||||
| Accounts receivable: | ||||||||||||||
| Customer | ||||||||||||||
| Allowance for doubtful accounts | ( | ( | ||||||||||||
| Other | ||||||||||||||
| Accrued unbilled revenues | ||||||||||||||
| Total accounts receivable | ||||||||||||||
| Deferred fuel costs | ||||||||||||||
| Fuel inventory - at average cost | ||||||||||||||
| Materials and supplies | ||||||||||||||
| Deferred nuclear refueling outage costs | ||||||||||||||
| Prepayments and other | ||||||||||||||
| TOTAL | ||||||||||||||
| OTHER PROPERTY AND INVESTMENTS | ||||||||||||||
| Decommissioning trust funds | ||||||||||||||
| Non-utility property - at cost (less accumulated depreciation) | ||||||||||||||
| Storm reserve escrow accounts | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| PROPERTY, PLANT, AND EQUIPMENT | ||||||||||||||
| Electric | ||||||||||||||
| Construction work in progress | ||||||||||||||
| Nuclear fuel | ||||||||||||||
| TOTAL PROPERTY, PLANT, AND EQUIPMENT | ||||||||||||||
| Less - accumulated depreciation and amortization | ||||||||||||||
| PROPERTY, PLANT, AND EQUIPMENT - NET | ||||||||||||||
| DEFERRED DEBITS AND OTHER ASSETS | ||||||||||||||
| Regulatory assets: | ||||||||||||||
Other regulatory assets (includes securitization property of $ | ||||||||||||||
| Deferred fuel costs | ||||||||||||||
| Goodwill | ||||||||||||||
| Accumulated deferred income taxes | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| TOTAL ASSETS | $ | $ | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| ENTERGY CORPORATION AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||||||||
| LIABILITIES AND EQUITY | ||||||||||||||
| September 30, 2026 and December 31, 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| CURRENT LIABILITIES | ||||||||||||||
| Currently maturing long-term debt | $ | $ | ||||||||||||
| Notes payable and commercial paper | ||||||||||||||
| Accounts payable | ||||||||||||||
| Customer deposits | ||||||||||||||
| Taxes accrued | ||||||||||||||
| Interest accrued | ||||||||||||||
| Deferred fuel costs | ||||||||||||||
| Pension and other postretirement liabilities | ||||||||||||||
| Customer advances | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| NON-CURRENT LIABILITIES | ||||||||||||||
| Accumulated deferred income taxes and taxes accrued | ||||||||||||||
| Accumulated deferred investment tax credits | ||||||||||||||
| Regulatory liability for income taxes - net | ||||||||||||||
| Other regulatory liabilities | ||||||||||||||
| Customer advances | ||||||||||||||
| Decommissioning and asset retirement cost liabilities | ||||||||||||||
| Accumulated provisions | ||||||||||||||
| Pension and other postretirement liabilities | ||||||||||||||
Long-term debt (includes securitization bonds of $ | ||||||||||||||
| Customer advances for construction | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| Commitments and Contingencies | ||||||||||||||
Subsidiaries’ preferred stock without sinking fund | ||||||||||||||
| EQUITY | ||||||||||||||
Preferred stock, | ||||||||||||||
Common stock, $ | ||||||||||||||
| Paid-in capital | ||||||||||||||
| Retained earnings | ||||||||||||||
| Accumulated other comprehensive loss | ( | ( | ||||||||||||
Less - treasury stock, at cost ( | ||||||||||||||
Total shareholders’ equity | ||||||||||||||
Subsidiaries’ preferred stock without sinking fund and noncontrolling interests | ||||||||||||||
| TOTAL | ||||||||||||||
| TOTAL LIABILITIES AND EQUITY | $ | $ | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| ENTERGY CORPORATION AND SUBSIDIARIES | |||||||||||||||||||||||||||||||||||||||||
| CONSOLIDATED STATEMENT OF CHANGES IN EQUITY | |||||||||||||||||||||||||||||||||||||||||
| For the Nine Months Ended September 30, 2026 | |||||||||||||||||||||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||||||||||||||||||
| Shareholders’ Equity | |||||||||||||||||||||||||||||||||||||||||
| Subsidiaries’ Preferred Stock and Noncontrolling Interests | Common Stock | Treasury Stock | Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total | |||||||||||||||||||||||||||||||||||
| (In Thousands) | |||||||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2025 | $ | $ | ($ | $ | $ | ($ | $ | ||||||||||||||||||||||||||||||||||
| Consolidated net income (a) | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Other comprehensive income | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
| Common stock issuances and sales under the at the market equity distribution program | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Common stock issuance costs | — | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||
| Common stock issuances related to stock plans | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||
| Common stock dividends declared | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Distributions to noncontrolling interests | ( | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||
| Preferred dividend requirements of subsidiaries (a) | ( | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||
| Balance at March 31, 2026 | ( | ||||||||||||||||||||||||||||||||||||||||
| Consolidated net income (a) | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Other comprehensive loss | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
| Common stock issuances and sales under the at the market equity distribution program | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Common stock issuances from settlement of equity forward sale agreements | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Common stock issuance costs | — | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||
| Common stock issuances related to stock plans | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Common stock dividends declared | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Distributions to noncontrolling interests | ( | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||
| Preferred dividend requirements of subsidiaries (a) | ( | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||
| Balance at June 30, 2026 | ( | ( | |||||||||||||||||||||||||||||||||||||||
| Consolidated net income (a) | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Other comprehensive loss | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
| Common stock issuances from settlement of equity forward sale agreements | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Common stock issuance costs | — | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||
| Common stock issuances related to stock plans | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Common stock dividends declared | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Distributions to noncontrolling interests | ( | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||
| Preferred dividend requirements of subsidiaries (a) | ( | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||
| Balance at September 30, 2026 | $ | $ | ($ | $ | $ | ($ | $ | ||||||||||||||||||||||||||||||||||
| See Notes to Financial Statements. | |||||||||||||||||||||||||||||||||||||||||
(a) Consolidated net income and preferred dividend requirements of subsidiaries for first quarter 2026, second quarter 2026, and third quarter 2026 each includes $ | |||||||||||||||||||||||||||||||||||||||||
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| ENTERGY CORPORATION AND SUBSIDIARIES | |||||||||||||||||||||||||||||||||||||||||
| CONSOLIDATED STATEMENT OF CHANGES IN EQUITY | |||||||||||||||||||||||||||||||||||||||||
| For the Nine Months Ended September 30, 2025 | |||||||||||||||||||||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||||||||||||||||||
| Shareholders’ Equity | |||||||||||||||||||||||||||||||||||||||||
| Subsidiaries' Preferred Stock and Noncontrolling Interests | Common Stock | Treasury Stock | Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income | Total | |||||||||||||||||||||||||||||||||||
| (In Thousands) | |||||||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2024 | $ | $ | ($ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
| Consolidated net income (a) | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Other comprehensive loss | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
| Common stock issuances related to stock plans | — | — | ( | — | — | ||||||||||||||||||||||||||||||||||||
| Common stock dividends declared | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Distributions to noncontrolling interests | ( | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||
| Preferred dividend requirements of subsidiaries (a) | ( | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||
| Balance at March 31, 2025 | ( | ||||||||||||||||||||||||||||||||||||||||
| Consolidated net income (a) | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Other comprehensive loss | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
| Common stock issuances and sales under the at the market equity distribution program | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Common stock issuance costs | — | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||
| Common stock issuances related to stock plans | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Common stock dividends declared | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Distributions to noncontrolling interests | ( | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||
| Preferred dividend requirements of subsidiaries (a) | ( | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||
| Balance at June 30, 2025 | ( | ||||||||||||||||||||||||||||||||||||||||
| Consolidated net income (a) | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Other comprehensive loss | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
| Common stock issuances related to stock plans | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Common stock dividends declared | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Distributions to noncontrolling interests | ( | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||
| Preferred dividend requirements of subsidiaries (a) | ( | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||
| Balance at September 30, 2025 | $ | $ | ($ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
| See Notes to Financial Statements. | |||||||||||||||||||||||||||||||||||||||||
(a) Consolidated net income and preferred dividend requirements of subsidiaries for first quarter 2025, second quarter 2025, and third quarter 2025 each includes $ | |||||||||||||||||||||||||||||||||||||||||
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ENTERGY CORPORATION AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
NOTE 1. COMMITMENTS AND CONTINGENCIES (Entergy Corporation, Entergy Arkansas, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy)
Entergy and the Registrant Subsidiaries are involved in a number of legal, regulatory, and tax proceedings before various courts, regulatory authorities, and governmental agencies in the ordinary course of business. While management is unable to predict with certainty the outcome of such proceedings, management does not believe that the ultimate resolution of these matters will have a material adverse effect on Entergy’s results of operations, cash flows, or financial condition, except as otherwise discussed in the Form 10-K or in this report. Entergy discusses regulatory proceedings in Note 2 to the financial statements in the Form 10-K and herein and discusses tax proceedings in Note 3 to the financial statements in the Form 10-K and Note 10 to the financial statements herein.
Vidalia Purchased Power Agreement
See Note 8 to the financial statements in the Form 10-K for information on Entergy Louisiana’s Vidalia PPA.
Spent Nuclear Fuel Litigation
See Note 8 to the financial statements in the Form 10-K for information on Entergy’s spent nuclear fuel litigation.
Nuclear Insurance
See Note 8 to the financial statements in the Form 10-K for information on nuclear liability and property insurance associated with Entergy’s nuclear power plants.
Non-Nuclear Property Insurance
See Note 8 to the financial statements in the Form 10-K for information on Entergy’s non-nuclear property insurance program.
Employment and Labor-related Proceedings
See Note 8 to the financial statements in the Form 10-K for information on Entergy’s employment and labor-related proceedings.
Asbestos Litigation (Entergy Arkansas, Entergy Louisiana, Entergy New Orleans, and Entergy Texas)
See Note 8 to the financial statements in the Form 10-K for information regarding asbestos litigation.
Grand Gulf-Related Agreements
See Note 8 to the financial statements in the Form 10-K for information regarding Grand Gulf-related agreements, including the Unit Power Sales Agreement and the Availability Agreement.
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Notes to Financial Statements
Exclusivity Agreement with Major Vendor
See Note 8 to the financial statements in the Form 10-K for information regarding Entergy’s exclusivity agreement with a major vendor. The following is an update to that discussion.
As discussed in the Form 10-K, Entergy entered into an exclusivity agreement with a major vendor to manufacture power island equipment (PIE) and combustion turbines (CT) for combustion turbine generator set frames larger than 400 MWs. The agreement was amended in second quarter 2026, updating the minimum order commitment of PIE to 27 sets, with no change to the original commitment of a minimum order of two CTs. As of September 30, 2026, 10 sets of PIE and two CT slots of the minimum commitment have been fulfilled.
Entergy Texas Build-to-Suit Lease Arrangement for the Legend Power Station
See Note 8 to the financial statements in the Form 10-K for information regarding the Entergy Texas build-to-suit lease arrangement for the Legend Power Station.
Entergy Louisiana Build-to-Suit Lease Arrangement for the Waterford 6 Power Station
In October 2026, Entergy Louisiana entered a build-to-suit lease arrangement for the Waterford 6 Power Station as the lessee with a consortium of investors (the Investors). Under the terms of the arrangement, the Investors purchased the in-process Waterford 6 Power Station construction project from Entergy Louisiana at a cost of $167.5 million and will spend up to $1.875 billion (including the initial purchase price) to construct the Waterford 6 project as designed by Entergy Louisiana. Entergy Louisiana is engaged to serve as the construction agent for the Waterford 6 Power Station project. The Investors, however, control the asset during construction. If Entergy Louisiana defaults in its role as construction agent, the Investors have various options available to remedy the default, including the replacement of Entergy Louisiana as construction agent, the acceleration of the lease balance payable by Entergy Louisiana, causing a sale of the Waterford 6 Power Station project to a third party, and certain other options. If the LPSC rejects the Waterford 6 Power Station project or certain other circumstances occur that are outside of Entergy Louisiana’s control, then either the Investors or Entergy Louisiana could exercise the right to terminate the arrangement, in which case Entergy Louisiana would be required to purchase the in-process Waterford 6 Power Station project from the Investors at an amount equal to their costs incurred to date, including carrying costs. Because Entergy Louisiana does not control the in-process construction project, it will not recognize the asset (i.e., construction work in progress) or an associated liability during construction.
Upon the Waterford 6 Power Station’s readiness for first synchronization to the grid, expected in late 2029, a triple-net lease will commence under which Entergy Louisiana will have control of the Waterford 6 Power Station and receive all output from the plant. The initial term of the lease will end seven years from the closing of the arrangement, or approximately four years after the Waterford 6 Power Station’s expected readiness for first synchronization to the grid. The lease cost will be equal to the Secured Overnight Financing Rate plus a margin which is based on the credit rating of Entergy Louisiana, multiplied by the total costs (including carrying costs) incurred by the Investors as of the commencement of the lease. Entergy Louisiana will have the option to purchase the Waterford 6 Power Station at any time during the lease term at a price equal to the total cost of the plant to the Investors, plus any fees and carrying charges owed to the Investors. If the purchase price option is exercised within two years of commencement of the triple-net lease, Entergy Louisiana must enter into a secured note payable to the Investors for the amount of the purchase price. The note payable would be due at the end of the initial lease term, but may be prepaid at any time beginning two years after the commencement date of the lease. The note will be secured by the Waterford 6 Power Station and related equipment and collateral.
At the end of the initial lease term, Entergy Louisiana must exercise one of the following options: (1) renew the lease for an additional five year term, subject to unanimous consent of the Investors; (2) purchase the plant at a price equal to the total cost of the plant to Investors, plus any fees and carrying charges owed to the Investors; or (3)
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Notes to Financial Statements
sell the plant on behalf of the Investors. If Entergy Louisiana chooses the third option, then it will owe or be owed any difference between the total cost of the plant to Investors and the sale price.
NOTE 2. RATE AND REGULATORY MATTERS (Entergy Corporation, Entergy Arkansas, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy)
Regulatory Assets and Regulatory Liabilities
See Note 2 to the financial statements in the Form 10-K for information regarding regulatory assets and regulatory liabilities in the Utility business presented on the balance sheets of Entergy and the Registrant Subsidiaries. The following are updates to that discussion.
Fuel and purchased power cost recovery
Entergy Arkansas
Energy Cost Recovery Rider
In March 2026, Entergy Arkansas filed its annual redetermination of its energy cost rate pursuant to the energy cost recovery rider, which reflected an increase in the rate from $0.01333 per kWh to $0.01508 per kWh. The primary reason for the rate increase was an under-recovered balance as a result of higher natural gas prices in 2025. Based on circumstances related to ANO 2’s refueling outage, Entergy Arkansas made an adjustment to projected energy costs to phase-in the rate increase gradually. The redetermined rate of $0.01508 per kWh became effective with the first billing cycle in April 2026 through the normal operation of the tariff.
Entergy Louisiana
As discussed in the Form 10-K, in March 2020 the LPSC staff provided notice of an audit of Entergy Louisiana’s fuel adjustment clause filings. The audit includes a review of the reasonableness of charges flowed through Entergy Louisiana’s fuel adjustment clause for the period from 2016 through 2019. The LPSC staff issued its audit report in September 2021, and although certain internal record keeping recommendations were made, the LPSC staff did not recommend any disallowances. In October 2026 the LPSC staff and Entergy Louisiana filed a joint audit report addressing the issues identified in the LPSC staff’s September 2021 audit report and stating that there were no unresolved issues. The LPSC voted to approve the joint audit report at its October 2026 Business and Executive Session.
As discussed in the Form 10-K, in June 2025 the LPSC staff provided notice of an audit of Entergy Louisiana’s purchased gas adjustment clause filings (for Entergy Louisiana’s gas operations). The audit includes a review of the reasonableness of charges flowed through Entergy Louisiana’s purchased gas adjustment clause for the period from January 2023 through June 2025. The LPSC staff issued its audit report in March 2026. In October 2026 the LPSC staff and Entergy Louisiana filed a joint audit report. The joint audit report noted that an issue identified in its March 2026 report had been addressed and that, as a result, there were no outstanding unresolved issues. The joint audit report recommended and requested that an LPSC order be issued finding that all costs included in Entergy Louisiana’s purchased gas adjustment filings in the audit period were reasonable, prudent, and necessary and in compliance with applicable LPSC orders, and thus were appropriately eligible for recovery from customers. The LPSC voted to approve the joint audit report at its October 2026 Business and Executive Session.
In February 2026, Entergy Louisiana, in its monthly filing to update its fuel adjustment clause, requested to defer approximately $141.9 million of fuel costs incurred in January 2026 that were primarily attributable to the effects of Winter Storm Fern, consistent with the LPSC’s general order approved at its February 2026 meeting permitting temporary modifications to the LPSC’s fuel adjustment clause general order. The filing proposed to
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Notes to Financial Statements
defer the recovery of these fuel costs over a four-month period from March 2026 through June 2026 to mitigate the customer bill impacts of these fuel costs. In March 2026 the LPSC issued a special order delegating authority to the LPSC executive secretary to review and approve utility-specific requests for deferral of fuel costs from Winter Storm Fern, subject to audit as per the LPSC’s fuel clause general order. In April 2026 the LPSC executive secretary approved Entergy Louisiana’s request for deferral.
In April 2026 the LPSC staff provided notice of an audit of Entergy Louisiana’s fuel adjustment clause filings. The audit includes a review of the reasonableness of charges flowed through Entergy Louisiana’s fuel adjustment clause for the period from 2023 through 2025. Discovery is ongoing, and no audit report has been filed.
Entergy Texas
In September 2026, Entergy Texas filed an application with the PUCT to reconcile its fuel and purchased power costs for the period from April 2024 through March 2026. During the reconciliation period, Entergy Texas incurred approximately $1.2 billion in eligible fuel and purchased power expenses to generate and purchase electricity to serve its customers, net of certain revenues credited to such expenses and other adjustments. Entergy Texas’s cumulative over-recovery balance for the reconciliation period was approximately $90.1 million, including interest, which Entergy Texas requested authority to carry over as part of the cumulative fuel balance for the subsequent reconciliation period beginning April 2026.
Capacity Cost Recovery Rider (CCRR)
In May 2026, Entergy Texas filed with the PUCT a request to establish a new CCRR. The new CCRR was designed to collect approximately $58 million annually from Entergy Texas’s retail customers based on Entergy Texas’s eligible capacity-related costs and revenues for the 12 months beginning June 1, 2026. The eligible capacity-related costs and revenues are associated with Entergy Texas’s participation in MISO’s annual planning resource auction. In July 2026 the PUCT approved the CCRR, consistent with Entergy Texas’s as-filed request, and rates became effective on July 10, 2026.
Frontier Power Purchase Agreement
In June 2026, Entergy Texas filed an application for PUCT pre-approval of a long-term 14-year PPA for 300 MW of capacity and energy from the Tenaska Frontier Generating Station, an 830 MW natural gas-fired combined-cycle combustion turbine plant in Grimes County, Texas. As a result of accelerated load growth in Texas and other factors in Entergy Texas’s service territory, Entergy Texas has a significant near- and long-term need for capacity and energy to serve its customers. Within the application, Entergy Texas requested the PUCT find that the PPA will satisfy Entergy Texas’s identified reliability needs in allowing for cost recovery of the associated purchased power. The 14-year PPA has a total estimated cost of $883 million. In September 2026 the ALJ with the State Office of Administrative Hearings adopted a procedural schedule with a hearing on the merits scheduled in October 2026. In October 2026, Entergy Texas filed on behalf of the parties a joint motion to abate the procedural schedule noting that the parties had reached a settlement in principle and the ALJ with the State Office of Administrative Hearings approved the joint motion to allow the parties time to finalize the settlement.
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Notes to Financial Statements
Retail Rate Proceedings
See Note 2 to the financial statements in the Form 10-K for information regarding retail rate proceedings involving the Utility operating companies. The following are updates to that discussion.
Filings with the APSC (Entergy Arkansas)
Retail Rates
2026 Base Rate Case
In February 2026, Entergy Arkansas filed with the APSC a general change in rates, charges, and tariffs. The filing requested a base rate increase to recover a base rate revenue deficiency of $44.6 million and notified the APSC of Entergy Arkansas’s intent to implement a forward test year formula rate plan pursuant to Arkansas legislation passed in 2015. The primary drivers of the revenue deficiency were increased depreciation expense and the impact of net capital additions. Additionally, the filing requested a 9.90 % return on common equity and increased depreciation rates as the result of a depreciation study. In March 2026 the APSC issued an order suspending the proposed rates and tariffs filed by Entergy Arkansas. In June 2026 the APSC established a procedural schedule with an evidentiary hearing scheduled to begin in November 2026, and in July 2026 a number of intervenors moved to modify the schedule to conduct additional discovery. Entergy Arkansas opposed the motion in part based on the voluminous discovery conducted to date. In August 2026 the APSC general staff and intervenors filed responsive testimony recommending rate reductions comprised primarily of adjustments to the return on common equity, capital structure, depreciation, working capital, vegetation management, and incentive compensation. In September 2026, Entergy Arkansas filed rebuttal testimony addressing each of the proposed adjustments and supporting its update to actuals, made in accordance with APSC rules, resulting in a reduced base rate revenue deficiency of $28.6 million. In October 2026 the APSC general staff and intervenors filed their last round of testimony, and Entergy Arkansas filed its final round of responsive testimony, which included a revised base rate revenue deficiency of $28.9 million. Also in October 2026, Entergy Arkansas, the APSC general staff, and an intervenor filed a joint motion with the APSC requesting approval of a settlement agreement in the base rate case proceeding. The settlement agreement proposes, among other items: (1) no change in retail revenues as a result of a settlement base rate revenue deficiency of zero ; (2) an authorized return on common equity of 9.7 %; (3) a capital structure of 47.5 % equity and 52.5 % debt; and (4) adjustments to depreciation rates reflecting changes to the useful lives of certain assets and net salvage curves. In addition, the settlement includes an acceleration of an estimated credit to customers, resulting from the netting adjustment for the 2026 historical year. That netting adjustment would normally be provided as part of the 2027 evaluation report and included in rates effective January 1, 2028. The settlement proposes that the credit would be included in formula rate plan rates beginning January 1, 2027. Following the filing of the October 2026 joint motion with the APSC, the APSC issued an order clarifying that, because the settlement agreement is not unanimous, the hearing currently scheduled for November 2026 will not be conducted solely as a settlement hearing and directing Entergy Arkansas to file additional information to allow the APSC to fully evaluate the settlement agreement.
2026 Formula Rate Plan Filing
In July 2026, Entergy Arkansas filed with the APSC its 2026 formula rate plan filing to set its formula rate for the 2027 calendar year. The filing contained an evaluation of Entergy Arkansas’s earnings and a netting adjustment for the 2025 historical year. The filing showed that Entergy Arkansas’s earned rate of return on common equity for the 2025 historical year was 8.8 %, resulting in a $47.2 million formula rate plan revenue increase to produce a 9.65 % earned rate of return on common equity. When combined with 2025 historical year formula rate plan revenues of $56.0 million, the total proposed revenue change for the 2025 historical year netting adjustment is a reduction of $8.8 million. By operation of the formula rate plan, Entergy Arkansas’s recovery of the revenue requirement is subject to a four percent annual revenue constraint. Entergy Arkansas’s revenue requirement in this filing did not exceed the constraint. In second quarter 2026, Entergy Arkansas recorded a
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Notes to Financial Statements
regulatory liability of $8.8 million to reflect the amount of the 2025 historical year netting adjustment that it collected from customers during the 2025 rate effective period. In October 2026, Entergy Arkansas and the APSC staff filed a joint motion requesting to cancel the hearing scheduled for November 2026, and, as there are no contested issues between the parties to the proceeding, requesting the APSC decide this matter consistent with the pleadings and testimony in the record.
Generating Arkansas Jobs Act Rider
In March 2026, Entergy Arkansas filed its first annual update to the Generating Arkansas Jobs Act rider, requesting recovery of $110.4 million of financing costs during construction of generation and transmission strategic investments related to Ironwood Power Station, Jefferson Power Station, and the Arkansas Cypress Solar facility. The revised rates were requested to be effective with the first billing cycle of June 2026. In April 2026 the APSC general staff filed testimony arguing that the APSC had not issued an order designating Ironwood Power Station as a strategic investment and that related costs should therefore be removed from the annual update. Also in April 2026, Entergy Arkansas filed testimony asserting that the APSC general staff’s position is contrary to the plain language of the statute, which includes an exception for facilities like Ironwood Power Station that were certified by the APSC within a certain timeframe. A hearing was held in April 2026. In June 2026 the APSC approved Entergy Arkansas’s annual update, and rates became effective June 4, 2026.
Production Tax Credit Tariffs
As discussed in Note 3 to the financial statements in the Form 10-K, in January 2026 the APSC opened a docket to investigate the sale of Entergy Arkansas’s nuclear production tax credits and the appropriate ratemaking treatment of production tax credits for all of Entergy Arkansas’s eligible resources, including how the proceeds of any sales should flow through to customers. For nuclear production tax credits, Entergy Arkansas proposed a nuclear production tax credit rider, which would provide for the immediate flow through to customers of the weighted average cost of capital return on the net proceeds of the monetized nuclear production tax credits. Recognizing that the timing and determination from the IRS is uncertain, the nuclear production tax credit rider also proposes that, if there is an unfavorable IRS determination, Entergy Arkansas would collect applicable costs from customers. As directed by the APSC, in February 2026, Entergy Arkansas submitted a compliance filing to the APSC verifying the status of the solar production tax credits. The filing also verified that the net proceeds from the sale of the nuclear production tax credits were recorded in FERC accounts that are accruing a return for customers’ benefit at a rate that is above the customer deposit rate. Subsequently, in March 2026, Entergy Arkansas filed testimony setting forth its proposal for the solar production tax credits. Specifically, Entergy Arkansas requested the same ratemaking treatment for all of the solar facilities that the APSC already approved for Walnut Bend (i.e., the total net monetized proceeds from production tax credits expected to be generated over the first ten years of a solar facility’s operation are estimated and then amortized over the expected useful life of the asset, which is typically 30 years). Additionally, consistent with prior orders for these resources, the regulatory liabilities associated with the net cash proceeds from monetized solar production tax credits will be included in Entergy Arkansas’s calculation of its weighted average cost of capital providing a return on the unamortized balance for the benefit of customers. Further, Entergy Arkansas proposes to flow the benefits of the solar production tax credits to customers through Entergy Arkansas’s formula rate plan, effective with the formula rate plan rates that will go into effect January 1, 2027. Entergy Arkansas’s proposal would result in the benefits of the production tax credits being passed through to customers, if approved, as reductions in revenue requirement evenly over the life of the assets, rather than only during the 10-year period in which the production tax credits are generated. In April 2026 the APSC general staff filed testimony proposing an amortization period of no more than 15 years for the monetized proceeds for the tax credits associated with the West Memphis Solar and Driver Solar facilities. An evidentiary hearing was initiated in July 2026 and completed in August 2026.
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Special Rate Contract and Arkansas Cypress Solar
As discussed in the Form 10-K, in September 2025, Entergy Arkansas filed an application with the APSC seeking approval of a long-term special rate contract between Altitude Capital, LLC, a subsidiary of Alphabet Inc. (Google) and Entergy Arkansas for the sale of electricity to a new large-scale data center in West Memphis, Arkansas. In December 2025 the APSC issued an order approving the special rate contract but denying the requested ratemaking treatment of Google’s upfront payments and deferring a decision on the treatment under the contract pricing providing for the deferral and amortization of the investment tax credits from the Arkansas Cypress Solar facility (discussed below). Also in December 2025, Entergy Arkansas filed a petition with the APSC regarding these findings, noting that they would require renegotiation of the special rate contract. In January 2026 the APSC issued an order maintaining its position on the ratemaking treatment of Google’s upfront payments but reversing itself on the treatment of the Arkansas Cypress Solar facility investment tax credits and allowing those to be used in the pricing of the Arkansas Cypress Solar facility to Google as provided for in the contract. In October 2026, Entergy Arkansas filed for approval of an amendment to the special rate contract regarding the expansion and acceleration of Google’s project in West Memphis. Subject to APSC approval, investments proposed under the amended contract included a 250 MW battery energy storage system to be located at the Driver Solar facility in Mississippi County, Arkansas (Driver Solar battery energy storage system), a 100 MW battery energy storage system to be located adjacent to the existing Arklahoma substation near the in-progress Ironwood Power Station in Hot Spring County, Arkansas (Jones Mill battery energy storage system), a 440 MW solar power purchase agreement from the Big Island Solar facility, and related transmission upgrades and facilities. A procedural schedule has been set with a hearing scheduled for January 2027.
As discussed in the Form 10-K, in September 2025, Entergy Arkansas filed an application with the APSC seeking a certificate of environmental compatibility and public need for the construction and operation of the Arkansas Cypress Solar facility, a planned 600 MW solar photovoltaic array with a 350 MW battery energy storage system and associated transmission facilities interconnecting at Entergy Arkansas’s White Bluff substation. The estimated cost of the project is $1,602 million. In March 2026 the APSC approved the Arkansas Cypress Solar facility and Entergy Arkansas’s recovery of the costs of the facility through the Generating Arkansas Jobs Act rider. The APSC also ordered implementation of an independent monitor to oversee costs. In April 2026, Entergy Arkansas filed with the APSC its proposal for an independent monitor to oversee the reasonableness of costs. In April 2026 the APSC issued an order consolidating Entergy Arkansas’s independent monitor proposals for three pending resources, including the Arkansas Cypress Solar facility, into a single docket and directing parties with full intervention status to respond to the proposals and recommend independent monitor candidates. No alternative recommendations were made by the other parties, and the APSC approved Entergy Arkansas’s independent monitor proposal in September 2026. The facility is expected to be in service by the end of 2028.
In October 2026, Entergy Arkansas filed an application with the APSC seeking a certificate of environmental compatibility and public need for the construction and operation of the Driver Solar battery energy storage system and the Jones Mill battery energy storage system. The battery energy storage systems are being developed to help support the expansion and acceleration of Google’s project in West Memphis. The estimated cost of the Driver Solar battery energy storage system is $389.4 million, and the estimated cost of the Jones Mill battery energy storage system is $161.2 million. Pending receipt of APSC approval, each battery energy storage system is expected to be in service in 2028.
Filings with the LPSC (Entergy Louisiana)
Retail Rates
Resilience Plan Cost Recovery Rider
In December 2022, Entergy Louisiana filed an application with the LPSC seeking a public interest finding regarding Phase I of Entergy Louisiana’s Future Ready resilience plan and approval of a rider mechanism to recover
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the program’s costs. Phase I in the December 2022 application reflected the first five years of a ten-year resilience plan and included investment of approximately $5 billion, including hardening investment, transmission dead-end structures, enhanced vegetation management, and telecommunications improvement. In April 2024 the LPSC approved a framework which includes an initial five-year resilience plan providing for an investment of approximately $1.9 billion with cost recovery via a forward-looking rider with semi-annual true-ups. The plan is subject to specified reporting requirements and includes a performance review of the hardened assets. The LPSC order approving the framework does not include any restrictions on Entergy Louisiana’s ability to file applications for approval of additional investments in resilience.
In January 2025, Entergy Louisiana’s semi-annual filing sought to collect from Entergy Louisiana’s retail customers approximately $40.4 million, or $38.9 million in incremental annual revenues from Entergy Louisiana’s first semi-annual filing in July 2024, for projects expected to be placed in service during the rate-effective period of March 2025 through August 2025. In February 2025 the LPSC staff reviewed the filed rider rates and identified no material issues.
In July 2025, Entergy Louisiana’s semi-annual filing sought to collect from Entergy Louisiana’s retail customers approximately $50.2 million, or $9.8 million in incremental annual revenues, for projects expected to be placed in service during the rate-effective period of September 2025 through February 2026. Additionally, Entergy Louisiana’s true-up filing included an under-recovery totaling $5.6 million to be implemented in the January 2026 semi-annual filing. In August 2025 the LPSC staff reviewed the filed rider rates and identified no material issues.
In January 2026, Entergy Louisiana’s semi-annual filing sought to collect from Entergy Louisiana’s retail customers approximately $101.8 million, or $51.6 million in incremental annual revenues, for projects expected to be placed in service during the rate-effective period of March 2026 through August 2026. Additionally, Entergy Louisiana’s true-up filing included an over-recovery totaling $16.6 million to be implemented in the July 2026 semi-annual filing. In February 2026 the LPSC staff reviewed the filed rider rates and identified no material issues.
In July 2026, Entergy Louisiana’s semi-annual filing sought to collect from Entergy Louisiana’s retail customers approximately $114.2 million, or $12.4 million in incremental annual revenues, for projects expected to be placed in service during the rate-effective period of September 2026 through February 2027. Additionally, Entergy Louisiana’s true-up filing included an under-recovery totaling $2.5 million to be implemented in the January 2027 semi-annual filing. In August 2026 the LPSC staff reviewed the filed rider rates and identified no material issues.
In September 2026, Entergy Louisiana filed an application for the LPSC’s approval of Phase IA of Entergy Louisiana’s Future Ready resilience plan, which consists of additional distribution and transmission hardening projects representing approximately $600 million of investment to be completed over the period 2027 to 2030. The application seeks LPSC approval to extend the previously-approved Phase I of Entergy Louisiana’s Future Ready resilience plan with these additional projects to further improve the resilience of Entergy Louisiana’s electric system and further seeks approval to continue to use the resilience plan cost recovery rider to recover the costs of the plan from customers. The primary purpose of Phase IA is to serve as a bridge between Phase I, which is currently expected to conclude by 2028, and a Phase II plan, which Entergy Louisiana expects to develop in accordance with guidance from the LPSC that is expected to be issued in the LPSC’s ongoing resiliency rulemaking docket. Discovery is ongoing. In October 2026 a procedural schedule was established that provides for a hearing in June 2027. Entergy Louisiana has requested an LPSC decision by July 2027.
Vegetation Management Rider
In November 2025 the LPSC staff issued notice of its initiation of a rulemaking to implement a vegetation management pilot program for LPSC jurisdictional electric utilities. The pilot program would be voluntary and would allow utilities to establish a rider for distribution vegetation management for up to 100 % of the utility’s prior calendar year vegetation management spending. The rider may not exceed 1 % of a customer’s bill, and the utility
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would be required to maintain its prior calendar year level of spending on vegetation management as reflected in its base rates or formula rate plan. In February 2026 the LPSC staff filed a report and recommendation along with a proposed final rule providing for the adoption of the pilot program consistent with the terms outlined in the original notice. In March 2026 the LPSC voted to accept the LPSC staff’s recommendation and adopt the proposed pilot program as presented. In April 2026, Entergy Louisiana filed its vegetation management rider for the rate-effective period of May 2026 through December 2026, which included a revenue requirement of $20 million for incremental spending on distribution vegetation management above the prior calendar year level of spending on vegetation management.
2025 Formula Rate Plan Filing
In June 2026, Entergy Louisiana filed its formula rate plan evaluation report for its 2025 calendar year operations. Consistent with the global stipulated settlement agreement approved by the LPSC in August 2024, the filing reflected a 9.7 % allowed return on common equity with a bandwidth of 40 basis points above and below the midpoint. For the test year 2025, the formula produced an earned return on equity of 9.63 %, which falls within the established bandwidth and therefore results in no adjustment to base rider formula rate plan revenue.
Additional changes in formula rate plan revenue include: (1) the removal of approximately $73 million in annual customer credits associated with the global stipulated settlement agreement, which have been fully credited to customers in accordance with the agreement; (2) a reduction in customer credits through the tax adjustment mechanism, attributable to the return of Entergy Louisiana’s over-collection of income tax expense associated with Louisiana state tax law changes effective in 2025 and the expiration of certain ad valorem exemptions; (3) increases in transmission and distribution plant in service, as recognized through the transmission and distribution recovery mechanisms, including restoration costs from Winter Storm Fern, for which Entergy Louisiana does not intend to seek relief or exception to the formula rate plan; (4) increases to the additional capacity mechanism; and (5) the final phase-in of additional nuclear depreciation expense, in accordance with the global stipulated settlement agreement. See Note 2 to the financial statements in the Form 10-K for discussion of the global stipulated settlement agreement. Collectively, these factors contributed to a net increase of $222 million in formula rate plan revenue for the period. In August 2026 the LPSC staff filed its errors and objections report. The report did not identify any specific errors, objections, or adjustments. However, the LPSC staff reserved its rights with respect to three issues pending further review: (1) the allocation between Entergy Louisiana and Entergy Texas of River Bend’s undepreciated plant balances, costs, and related liabilities; (2) certain projects included in the transmission recovery mechanism filing; and (3) the use of a blended retail/FERC depreciation rate for River Bend depreciation expense. Subject to LPSC review, the resulting changes from the 2025 formula rate plan evaluation report became effective for bills rendered during the first billing cycle of September 2026, subject to refund.
Request for Extension of Formula Rate Plan
In June 2026, Entergy Louisiana submitted a motion requesting the LPSC approve a one-year extension of its current formula rate plan, with all material provisions left unchanged, including the allowed return on common equity of 9.7 % with a bandwidth of 40 basis points above and below the midpoint. LPSC action on the proposed extension is expected by November 2026.
River Bend Deregulated Asset Plan Filing
In September 2025, Entergy Louisiana filed an application seeking LPSC approval to recover from customers, prospectively, approximately $49 million in annual revenues associated with the Louisiana retail deregulated portion of River Bend. Costs associated with the deregulated portion of River Bend have historically been excluded from retail ratemaking as a result of a 1988 LPSC decision. Instead, Entergy Louisiana has been allowed by the LPSC to either recover 4.6 cents per kWh for the power generated from that portion of the plant, or sell the power into the applicable market (subject to certain restrictions). The filing presents evidence that River Bend is a cost-effective and prudent source of needed baseload supply with value to Entergy Louisiana customers
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and seeks to recover the previously excluded costs, on a prospective basis. In March 2026 the LPSC staff and certain intervenors filed direct testimony recommending that the LPSC deny Entergy Louisiana’s application. The LPSC staff’s testimony further recommends that, if the LPSC were to grant any relief, notwithstanding the LPSC staff’s recommendation, such relief should be limited to allowing only prospective capital additions at River Bend to be included in Entergy Louisiana’s customer rates. Entergy Louisiana filed rebuttal testimony in August 2026. In October 2026, Entergy Louisiana filed a motion requesting to suspend all remaining procedural deadlines without date, noting the significant number of dockets currently pending before the LPSC, including many initiated by Entergy Louisiana, and the need for thorough review of these matters. In October 2026 the presiding ALJ issued an order granting the motion and suspending the procedural schedule, including continuing the hearing in the matter without date.
Filings with the MPSC (Entergy Mississippi)
Retail Rates
2026 Formula Rate Plan Filing
In February 2026, Entergy Mississippi submitted its formula rate plan 2026 test year filing and 2025 look-back filing showing Entergy Mississippi’s earned return on rate base for the historical 2025 calendar year to be within the formula rate plan bandwidth and projected earned return for the 2026 calendar year to also be within the formula rate plan bandwidth. The 2026 test year filing resulted in an earned return on rate base of 7.64 % and reflected no change in formula rate plan revenues. The 2025 look-back filing compared actual 2025 results to the approved benchmark return on rate base and reflected no change in formula rate plan revenues, although Entergy Mississippi proposed to adjust interim rates by $293 thousand to reflect one outside-the-bandwidth change, a true-up of demand side management costs.
In June 2026, Entergy Mississippi and the Mississippi Public Utilities Staff entered into a joint stipulation that confirmed the 2026 test year filing, with the exception of immaterial adjustments to certain operations and maintenance expenses. The formula rate plan reflected an earned return on rate base of 7.68 % for calendar year 2026, resulting in no change in formula rate plan revenues for 2026. Pursuant to the stipulation, Entergy Mississippi’s 2025 look-back filing reflected an earned return on rate base of 8.10 %, which also resulted in no change in formula rate plan revenues for 2025. In addition, the stipulation included the recovery of the outside-the-bandwidth change discussed above as well as the ratemaking treatment of certain customer contributions, the mechanism for recovery of the benefits of nuclear production tax credits, and the realignment of the first project from the interim facilities rate adjustment to the formula rate plan. In June 2026 the MPSC approved the joint stipulation with rates effective in July 2026. See Note 10 to the financial statements herein for further discussion of the mechanism for recovery of the benefits of nuclear production tax credits included in the joint stipulation.
Filings with the City Council (Entergy New Orleans)
Retail Rates
2026 Formula Rate Plan Filing
In April 2026, Entergy New Orleans submitted to the City Council its formula rate plan 2025 test year filing. The 2025 evaluation report produced an earned return on equity of 7.55 % compared to the authorized return on equity of 9.35 %. Without adjustments, this would result in an increase in rates of $16.6 million. The increase in rates is driven, in part, by an increase in plant in service, as well as the cost of known and measurable capital additions. The increase is also driven by a decrease in total revenues due to a decline in kWh sales. The filing is subject to a 75-day review and discovery period followed by a 25-day period to resolve any disputes among the parties.
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In July 2026 the City Council’s advisors issued a report seeking a reduction in Entergy New Orleans’s requested formula rate plan revenues of approximately $4.4 million due to certain proposed cost realignments, imputation of revenues, and disallowances. The City Council’s advisors also recommended that Entergy New Orleans be permitted to collect $20 million over five years beginning in September 2026 to recover amounts that it might be required to pay Entergy Louisiana and Entergy Arkansas pursuant to a FERC order issued in June 2026, relating to an alleged MSS-4 replacement tariff (MSS-4R) violation. However, the FERC order is unclear on its face, and the specific amount of a payment, if any, is unknown. Requests for rehearing and clarification of the FERC order are pending. See “MSS-4 Replacement Tariff - Net Operating Loss Carryforward Proceeding” below for additional discussion of the FERC order. Subsequent to the original recommendation from the City Council’s advisors regarding the FERC order, Entergy New Orleans reached a resolution with the City Council’s advisors, and the original proposed $20 million amount was reduced to $10 million over five years . Effective with the first billing cycle of September 2026, Entergy New Orleans implemented rates reflecting a formula rate plan increase of $13.8 million, as agreed upon by Entergy New Orleans and the City Council, per the approved process for formula rate plan implementation. Moreover, with respect to the FERC order, in October 2026 the City Council passed a resolution directing Entergy New Orleans to collect $2.3 million for year one, beginning in September 2026 from customers in anticipation of surcharge obligations resulting from the FERC order, to be collected outside the bandwidth. Until either the FERC determines or it is otherwise agreed that Entergy New Orleans must pay a surcharge, amounts collected from customers beginning September 2026 in anticipation of surcharge obligations resulting from the FERC order are being recorded as a regulatory liability. If the FERC determines or it is otherwise agreed that Entergy New Orleans must pay a surcharge, Entergy New Orleans will record a regulatory asset for the remaining uncollected balance, with carrying costs, including credit balances reflecting collections from customers that commenced in September 2026. If the FERC determines or it is otherwise agreed that Entergy New Orleans is owed payments, Entergy New Orleans will cease collecting amounts from customers beginning with the next base rate action and will return collected amounts to customers, including carrying costs.
Request for Extension of Formula Rate Plan
In July 2026, Entergy New Orleans submitted a motion requesting the City Council’s approval of a four-year extension of its current formula rate plan, with all material provisions left unchanged. In October 2026 the City Council approved Entergy New Orleans’s motion, authorizing the extension of Entergy New Orleans’s electric formula rate plan for test years 2026 through 2029.
Resilience and Storm Hardening Cost Recovery Rider Adjustment to the Formula Rate Plan
In October 2024 the City Council approved a rider mechanism for Entergy New Orleans to recover the costs of certain approved accelerated resilience projects to be constructed by Entergy New Orleans in 2025 and 2026. The rider allows for recovery of project costs through a formula rate plan rate adjustment. As required by the rider, in November 2024, Entergy New Orleans filed the first of its compliance filings, seeking a rate adjustment increase of approximately $1.1 million, and the increase in formula rate plan rates became effective in the first billing cycle of January 2025 in accordance with the terms of the rider. In October 2025, Entergy New Orleans made its second compliance filing, seeking a rate adjustment increase of approximately $11.8 million, and the increase in formula rate plan rates became effective in the first billing cycle of January 2026.
Filings with the PUCT and Texas Cities (Entergy Texas)
Retail Rates
Distribution Cost Recovery Factor (DCRF) Rider
In April 2026, Entergy Texas filed with the PUCT a request to amend its DCRF rider. The amended rider was designed to collect from Entergy Texas’s retail customers approximately $112.5 million annually, or $20.4 million in incremental annual revenues beyond Entergy Texas’s then-effective DCRF rider based on its
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capital invested in distribution between July 1, 2025 and December 31, 2025. In July 2026 the PUCT approved the DCRF rider, consistent with Entergy Texas’s as-filed request, and rates became effective for usage on and after July 8, 2026.
In September 2026, Entergy Texas filed with the PUCT a request to amend its DCRF rider. The proposed rider is designed to collect from Entergy Texas’s retail customers approximately $127.3 million annually, or $14.8 million in incremental annual revenues beyond Entergy Texas’s currently effective DCRF rider based on its capital invested in distribution between January 1, 2026 and June 30, 2026. In September 2026 the ALJ with the State Office of Administrative Hearings adopted a procedural schedule requiring the PUCT staff to file a recommendation on the merits of Entergy Texas’s application by November 2, 2026.
Transmission Cost Recovery Factor (TCRF) Rider
As discussed in the Form 10-K, in October 2025, Entergy Texas filed with the PUCT a request to amend its TCRF rider. The amended rider was designed to collect from Entergy Texas’s retail customers approximately $30.3 million annually, or $20.6 million in incremental annual revenues beyond Entergy Texas’s then-effective TCRF rider based on its capital invested in transmission between July 1, 2024 and June 30, 2025 and changes in other transmission charges. In April 2026 the PUCT approved the TCRF rider, consistent with Entergy Texas’s as-filed request, and rates became effective for usage on and after April 6, 2026.
In October 2026, Entergy Texas filed with the PUCT a request to amend its TCRF rider. The proposed rider is designed to collect from Entergy Texas’s retail customers approximately $56.7 million annually, or $26.4 million in incremental annual revenues beyond Entergy Texas’s currently effective TCRF rider based on its capital invested in transmission between July 1, 2025 and June 30, 2026 and changes in other transmission charges.
Generation Cost Recovery Rider
In March 2026, Entergy Texas filed an application to establish a generation cost recovery rider to begin recovering a return of and on its capital investment in the Orange County Advanced Power Station. The proposed generation cost recovery rider, which includes Entergy Texas’s capital invested in generation for the Orange County Advanced Power Station through December 31, 2025, was designed to collect approximately $150.4 million annually from Entergy Texas’s retail customers. In July 2026 the ALJ with the State Office of Administrative Hearings approved a proposed procedural schedule that included a hearing on the merits in September 2026 and provided for interim rates to become effective for usage on and after the Orange County Advanced Power Station in-service date, to the extent final rates were not in place by that time. In September 2026, Entergy Texas filed, and the ALJ with the State Office of Administrative Hearings granted, a joint motion to abate the procedural schedule and cancel the hearing on the merits to give the parties to the proceeding additional time to finalize a settlement. Interim rates became effective when the Orange County Advanced Power Station was placed into service in October 2026. Also in October 2026, Entergy Texas filed an unopposed stipulation resolving all issues in case, supporting testimony, a joint motion to adjust the interim rates previously implemented to correspond to the stipulated revenue requirement, and a joint motion to admit evidence and remand the proceeding to the PUCT. The unopposed stipulation would result in no disallowance of recoverable investment but would reduce the annual revenue requirement collected through the generation cost recovery rider by $5.7 million while the rider remains in effect. The PUCT is expected to issue a final order on the settlement by the end of 2026.
Entergy Arkansas Opportunity Sales Proceeding
See Note 2 to the financial statements in the Form 10-K for discussion of the Entergy Arkansas opportunity sales proceeding.
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Complaints Against System Energy
See Note 2 to the financial statements in the Form 10-K for information regarding complaints against System Energy and the settlements approved by the FERC that resolved all significant aspects of these complaints.
Unit Power Sales Agreement
See Note 2 to the financial statements in the Form 10-K for discussion of the Unit Power Sales Agreement. The following is an update to that discussion.
Pension Costs Amendment Proceeding
As discussed in the Form 10-K, in October 2021, System Energy submitted to the FERC proposed amendments to the Unit Power Sales Agreement to include in rate base the prepaid and accrued pension costs associated with System Energy’s qualified pension plans. In November 2025 the FERC issued an order approving System Energy’s proposed prepaid and accrued pension recovery mechanism. System Energy has been utilizing this methodology in billings since December 1, 2022 and will continue to utilize it going forward. As a result of the FERC’s order, System Energy did not owe any refunds. In December 2025 the APSC filed a request for rehearing of the November 2025 order. In January 2026 the FERC denied the APSC’s rehearing request by operation of law. In May 2026 the FERC issued a follow-up substantive order denying the APSC’s rehearing and sustaining its finding that no refunds are owed.
MSS-4 Replacement Tariff - Net Operating Loss Carryforward Proceeding
See Note 2 to the financial statements in the Form 10-K for discussion of the MSS-4R net operating loss carryforward proceeding. The following is an update to that discussion.
As discussed in the Form 10-K, in October 2021 the LPSC filed a complaint with the FERC alleging that Entergy Services improperly excluded net operating loss carryforward accumulated deferred income taxes (NOLC ADIT) from MSS-4R rates in the period before March 20, 2021. The LPSC argued that sales from Entergy Louisiana to Entergy Texas and Entergy New Orleans were charged at rates lower than they otherwise should have been, and it accordingly seeks surcharges for the period prior to March 20, 2021. The FERC set the complaint for hearing procedures and subsequently the hearing for this complaint proceeding was consolidated with the hearing procedures for Entergy Services’ January 2021 NOLC ADIT filing.
Testimony was filed by parties in 2023, and the hearing before a FERC ALJ was concluded in February 2024. In June 2024, the FERC ALJ issued an initial decision addressing three major issues: (1) whether Entergy Services’ proposed prospective inclusion and allocation of NOLC ADIT in MSS-4R rates using a modified with-and-without methodology is just and reasonable; (2) whether Entergy Services correctly calculated excess and deficient accumulated deferred income taxes in accordance with the terms of a prior settlement; and (3) whether NOLC ADIT should have been included in MSS-4R rates prior to the effective date of the January 2021 MSS-4R filing.
With respect to issues (1) and (2), the presiding ALJ concluded that Entergy Services’ proposed methodology for allocating and including NOLC ADIT in MSS-4R rates was just and reasonable and that Entergy Services correctly performed the excess and deficient accumulated deferred income taxes calculations. With respect to issue (3), however, the presiding ALJ agreed with the LPSC that NOLC ADIT should have been included in MSS-4R rates since September 1, 2016, and as a result, the presiding ALJ ordered that Entergy Louisiana and Entergy Arkansas recalculate bills for the period of September 1, 2016 through November 11, 2023 with surcharges expected to be due to those operating companies from the purchasing operating companies, Entergy New Orleans, Entergy Texas, and Entergy Louisiana (for some Entergy Arkansas sales). The presiding ALJ also ordered Entergy Services to pay the interest owed to Entergy Louisiana on these surcharges.
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The surcharge methodology that the presiding ALJ recommended in connection with issue (3) was not supported by any participant in the hearing. As part of their exceptions to the initial decision, all parties to the proceeding opposed the use of the ALJ’s methodology, except for the FERC trial staff, which took no position. During the hearing, the LPSC and the FERC trial staff advocated that the alleged tariff violation should be remedied by the application of Entergy Services’ January 2021 proposed methodology. All other parties, including the PUCT, the City Council, and Entergy Services, opposed any surcharges for the period prior to the March 20, 2021 effective date of the January 2021 filing.
Entergy Services disputed the presiding ALJ's rulings on issue (3) and filed exceptions to these rulings in July 2024. In June 2026 the FERC issued its opinion (Opinion No. 595) largely affirming the initial decision. Specifically, the FERC found the historic exclusion of NOLC ADIT from MSS-4R rates was a tariff violation and ordered Entergy Louisiana and Entergy Arkansas to provide refunds and/or surcharges, as appropriate, for the period from September 1, 2016 through November 12, 2023 for sales by Entergy Louisiana and for the period December 19, 2013 until May 13, 2024 for sales by Entergy Arkansas. The FERC also ordered the relevant operating company to pay interest on the amounts owed.
In July 2026, Entergy Services, the LPSC, the City Council, and the PUCT, filed separately for rehearing and clarification of Opinion No. 595. Entergy Services continues to dispute that the NOLC ADIT should have been included in MSS-4R rates prior to the effective date of the tariff amendment filing. Moreover, because of ambiguity in Opinion No. 595 and the pending rehearing and clarification requests, it is unclear whether Entergy Arkansas and Entergy Louisiana as sellers will receive surcharges or have to provide refunds. Specifically, there is a lack of clarity as to whether plant-related liability accumulated deferred income taxes must be included in calculating refunds/surcharges. Entergy Services also identified a lack of clarity regarding including the nuclear decommissioning liability deduction in the NOLC ADIT calculation. Depending on the guidance issued by the FERC in response to the request for rehearing and clarification of Opinion No. 595, each of the affected Entergy operating companies could either receive material refunds or owe material surcharges. In August 2026 the FERC granted Entergy Services’s motion to delay the payment and compliance filing until 60 days after the FERC’s issuance of an order in response to the requests for rehearing and/or clarification of Opinion No. 595. Also in August 2026 the FERC issued notice that the requests for rehearing have been denied by operation of law and may be addressed in a future order. In September 2026, Entergy Services filed with the D.C. Circuit a petition for review of Opinion No. 595. Given the ambiguity in Opinion No. 595, any amounts payable or receivable between the Entergy operating companies that may result from Opinion No. 595 are not reasonably estimable as of September 30, 2026.
MSS-4 Replacement Tariff – River Bend 70 Depreciation LPSC Complaint
In May 2026 the LPSC filed a complaint with the FERC alleging that Entergy Texas owes surcharges to Entergy Louisiana because the depreciation rates used in the MSS-4R for the River Bend 70 sales of capacity and energy were based on a directive of the PUCT for the period from September 1, 2016 to December 31, 2025. The LPSC quantifies the potential surcharge as $100 million, inclusive of interest. Entergy Services disputes that any surcharges are due from Entergy Texas to Entergy Louisiana. In June 2026, Entergy Services filed a motion to dismiss and answer to the complaint submitted by the LPSC.
Joint Targeted Interconnection Queue Cost Allocation Dispute
In April 2026, MISO submitted to the FERC an unexecuted agreement proposing to assign to Entergy Texas (in its capacity as the owner of the Legend Power Station) costs associated with the MISO and Southwest Power Pool Joint Targeted Interconnection Queue. Entergy Texas estimates that MISO’s proposed cost assignment would result in total charges of approximately $112 million, paid over twenty years beginning in 2031. In May 2026, Entergy Texas filed a protest to the agreement, as well as a separate complaint at the FERC, arguing that the proposed cost allocation is not just and reasonable. In June 2026 the FERC issued a deficiency notice to MISO. In
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Notes to Financial Statements
July 2026, MISO and Southwest Power Pool filed answers to the complaint, and MISO filed an answer to the deficiency letter. Protests and comments in response to MISO’s answer to the deficiency letter were filed in August 2026. In September 2026 the FERC issued a second deficiency letter to MISO. MISO’s response to the second deficiency letter was filed in October 2026. Protests and comments in response to MISO’s answer to the second deficiency letter are due in November 2026.
In August 2026, MISO submitted to the FERC an unexecuted agreement proposing to assign to Entergy Texas (in its capacity as the owner of the Lone Star Power Station) costs associated with the MISO and Southwest Power Pool Joint Targeted Interconnection Queue. Entergy Texas estimates that MISO’s proposed cost assignment would result in total charges of approximately $70 million, paid over twenty years beginning in 2031. In September 2026, Entergy Texas filed a protest to the agreement, as well as a separate complaint at the FERC, arguing that the proposed cost allocation is not just and reasonable. Answers and comments in response to Entergy Texas’s complaint are due in November 2026.
Storm Cost Recovery Filings with Retail Regulators
See Note 2 to the financial statements in the Form 10-K for discussion regarding storm cost recovery filings. The following is an update to that discussion.
Entergy Mississippi
Winter Storm Fern
In January 2026, Entergy Mississippi’s service territory experienced the effects of Winter Storm Fern, including prolonged freezing temperatures, heavy ice accumulations, and wind, which caused severe damage to Entergy Mississippi’s infrastructure. Following Winter Storm Fern, the “Mississippi 2026 Severe Winter Storm Electric Utility Customer Relief and Electric Utility System Restoration Act” was enacted by the Mississippi Legislature in April 2026. This legislation provides that the MPSC may issue an electric utility financing order authorizing the issuance of system restoration bonds, the proceeds of which shall be used to securitize the system restoration costs and storm damage reserve levels of those utilities affected by Winter Storm Fern. The legislation requires that an electric utility affected by the storm must first petition the MPSC for such a financing order that complies with the requirements outlined in the legislation. The legislation states that any system restoration bonds issued under a financing order will not be considered debt of the electric utility. These bonds will only be secured by the system restoration property specified in the financing order.
In October 2026, Entergy Mississippi filed a petition with the MPSC requesting an electric utility financing order authorizing the Mississippi State Bond Commission to act as the issuing agent for the State of Mississippi to issue system restoration bonds, the proceeds of which would be used by Entergy Mississippi to securitize approximately $237.8 million in total Winter Storm Fern system restoration costs, consisting of $145.7 million in non-fuel system restoration costs, $65.0 million in incremental fuel costs attributable to Winter Storm Fern, $7.6 million in retired damaged assets, $14.3 million in carrying costs estimated through the date of bond issuance, and $5.2 million in bond issuance costs and financing costs. Within the petition, Entergy Mississippi also requested that the MPSC find that the non-fuel system restoration costs and incremental fuel costs attributable to Winter Storm Fern were prudently incurred. The MPSC is expected to rule on the petition in December 2026.
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NOTE 3. EQUITY (Entergy Corporation and Entergy Louisiana)
Common Stock
Earnings per Share
The following table presents Entergy’s basic and diluted earnings per share calculations for the three and nine months ended September 30, 2026 and 2025, included on the consolidated income statements:
| For the Three Months Ended September 30, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| (Dollars In Thousands, Except Per Share Data; Shares in Millions) | |||||||||||||||||||||||
| $/share | $/share | ||||||||||||||||||||||
| Consolidated net income | $ | $ | |||||||||||||||||||||
| Less: Preferred dividend requirements of subsidiaries and noncontrolling interests | |||||||||||||||||||||||
| Net income attributable to Entergy Corporation | $ | $ | |||||||||||||||||||||
| Basic shares and earnings per average common share | $ | $ | |||||||||||||||||||||
| Average dilutive effect of: | |||||||||||||||||||||||
| Stock options | ( | ||||||||||||||||||||||
| Other equity plans | |||||||||||||||||||||||
| Equity forwards | ( | ( | |||||||||||||||||||||
| Diluted shares and earnings per average common share | $ | $ | |||||||||||||||||||||
| For the Nine Months Ended September 30, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| (Dollars In Thousands, Except Per Share Data; Shares in Millions) | |||||||||||||||||||||||
| $/share | $/share | ||||||||||||||||||||||
| Consolidated net income | $ | $ | |||||||||||||||||||||
| Less: Preferred dividend requirements of subsidiaries and noncontrolling interests | |||||||||||||||||||||||
| Net income attributable to Entergy Corporation | $ | $ | |||||||||||||||||||||
| Basic shares and earnings per average common share | $ | $ | |||||||||||||||||||||
| Average dilutive effect of: | |||||||||||||||||||||||
| Stock options | ( | ( | |||||||||||||||||||||
| Other equity plans | ( | ( | |||||||||||||||||||||
| Equity forwards | ( | ( | |||||||||||||||||||||
| Diluted shares and earnings per average common share | $ | $ | |||||||||||||||||||||
Earnings per share dilution resulting from stock options outstanding and other equity plans is determined under the treasury stock method. The calculation of diluted earnings per share excluded 293,562 stock options outstanding for the three months ended September 30, 2026 and 366,136 stock options outstanding for the three months ended September 30, 2025 because their effect would have been antidilutive. The calculation of diluted earnings per share excluded 264,617 stock options outstanding for the nine months ended September 30, 2026 and 325,454 stock options outstanding for the nine months ended September 30, 2025 because their effect would have
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been antidilutive. Until settlement of the forward sale agreements discussed in Note 7 to the financial statements in the Form 10-K and below in “Equity Distribution Program” and “Equity Forward Sale Agreements”, earnings per share dilution resulting from the agreements, if any, is determined under the treasury stock method. Share dilution occurs when the average market price of Entergy Corporation’s common stock is higher than the average forward sales price. The calculation of diluted earnings per share excluded 19,247,788 shares for the three months ended September 30, 2026 and 94,446 shares for the three months ended September 30, 2025 under forward sale agreements outstanding because their effect would have been antidilutive. The calculation of diluted earnings per share excluded 6,415,929 shares for the nine months ended September 30, 2026 and 901,408 shares for the nine months ended September 30, 2025 under forward sale agreements outstanding because their effect would have been antidilutive.
Entergy’s stock options and other equity compensation plans are discussed in Note 5 to the financial statements herein and in Note 12 to the financial statements in the Form 10-K.
Dividends declared per common share were $0.64 for the three months ended September 30, 2026 and $0.60 for the three months ended September 30, 2025. Dividends declared per common share were $1.92 for the nine months ended September 30, 2026 and $1.80 for the nine months ended September 30, 2025.
Equity Distribution Program
See Note 7 to the financial statements in the Form 10-K for discussion of Entergy Corporation’s at the market equity distribution program. The following are updates to that discussion.
The aggregate number of shares of common stock sold under the equity distribution sales agreement and under any forward sale agreement may not exceed an aggregate gross sales price of $4.5 billion. As of September 30, 2026, an aggregate gross sales price of approximately $2.8 billion has been sold under the at the market equity distribution program.
During the nine months ended September 30, 2026, Entergy Corporation physically settled its obligations under the following forward sale agreements:
| Effective Date of Forward Sale Agreements | Shares of Common Stock Issued | Gross Sales Price | Forward Sellers Fees | Forward Sale Price per Share | Cash Proceeds at Settlement | ||||||||||||||||||||||||||||||
| (Dollars In Thousands, Except Per Share Data) | |||||||||||||||||||||||||||||||||||
| Forward sale agreements settled in February 2026: | |||||||||||||||||||||||||||||||||||
| September 2024 | $ | $ | |||||||||||||||||||||||||||||||||
| March 2025 | $ | $ | |||||||||||||||||||||||||||||||||
| Total | $ | $ | |||||||||||||||||||||||||||||||||
| Forward sale agreements settled in June 2026: | |||||||||||||||||||||||||||||||||||
| September 2024 | $ | $ | |||||||||||||||||||||||||||||||||
| September 2024 | $ | $ | |||||||||||||||||||||||||||||||||
| Total | $ | $ | |||||||||||||||||||||||||||||||||
Entergy Corporation incurred an aggregate amount of approximately $0.5 million of general issuance costs associated with the February 2026 settlement and an aggregate amount of approximately $0.3 million of general issuance costs associated with the June 2026 settlement. Entergy Corporation used the net proceeds for general corporate purposes including the repayment of commercial paper.
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Equity Forward Sale Agreements
See Note 7 to the financial statements in the Form 10-K for discussion of Entergy Corporation’s equity forward sale agreements. The following are updates to that discussion.
In May 2026, Entergy Corporation marketed an equity offering of approximately 19.2 million shares of Entergy Corporation common stock. In lieu of issuing equity at the time of the offering, Entergy Corporation entered into forward sale agreements with several forward counterparties. No amounts have been or will be recorded on Entergy’s balance sheet with respect to the equity offering until settlements of the forward sale agreements occur. The forward sale agreements require Entergy Corporation to, at its election on or prior to April 30, 2028, either (1) physically settle the transactions by issuing the total of approximately 19.2 million shares of its common stock to the forward counterparties in exchange for net proceeds at the then-applicable forward sale price specified by the agreements (initially $110.74 per share) or (2) net settle the transactions in whole or in part through the delivery or receipt of cash or shares. The forward sale price is subject to adjustment on a daily basis based on a floating interest rate factor and will decrease by other fixed amounts specified in the agreements.
During the nine months ended September 30, 2026, Entergy Corporation physically settled its obligations under the following forward sale agreements:
| Effective Date of Forward Sale Agreements | Shares of Common Stock Issued | Gross Sales Price | Forward Sellers Fees | Forward Sale Price per Share | Cash Proceeds at Settlement | ||||||||||||||||||||||||||||||
| (Dollars In Thousands, Except Per Share Data) | |||||||||||||||||||||||||||||||||||
| Forward sale agreements settled in June 2026: | |||||||||||||||||||||||||||||||||||
| March 2025 | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
| Forward sale agreements settled in September 2026: | |||||||||||||||||||||||||||||||||||
| March 2025 | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
Entergy Corporation incurred approximately $0.3 million of common stock issuance costs associated with the June 2026 settlement and an aggregate amount of approximately $0.5 million associated with the September 2026 settlement. Entergy Corporation used the net proceeds for general corporate purposes including the repayment of commercial paper.
Until settlement of the forward sale agreements, earnings per share dilution resulting from the agreements, if any, will be determined under the treasury stock method. Share dilution occurs when the average market price of Entergy Corporation’s common stock is higher than the average forward sale price.
Treasury Stock
During the nine months ended September 30, 2026, Entergy Corporation reissued 1,013,630 shares of its previously repurchased common stock to satisfy stock option exercises, vesting of shares of restricted stock, and other stock-based awards. Entergy Corporation did not repurchase any of its common stock during the nine months ended September 30, 2026.
Retained Earnings
On October 30, 2026, Entergy Corporation’s Board of Directors declared a common stock dividend of $0.68 per share, payable on December 1, 2026 to holders of record as of November 13, 2026.
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Comprehensive Income
Accumulated other comprehensive income (loss) is included in the equity section of the balance sheets of Entergy and Entergy Louisiana. The following table presents changes in accumulated other comprehensive income (loss) for Entergy for the three months ended September 30, 2026 and 2025:
| Pension and Other Postretirement Plan Changes | |||||||||||
| 2026 | 2025 | ||||||||||
| (In Thousands) | |||||||||||
| Beginning balance, July 1, | ($ | $ | |||||||||
| Amounts reclassified from accumulated other comprehensive income (loss) | ( | ( | |||||||||
| Net other comprehensive loss for the period | ( | ( | |||||||||
| Ending balance, September 30, | ($ | $ | |||||||||
The following table presents changes in accumulated other comprehensive income (loss) for Entergy for the nine months ended September 30, 2026 and 2025:
| Pension and Other Postretirement Plan Changes | |||||||||||
| 2026 | 2025 | ||||||||||
| (In Thousands) | |||||||||||
| Beginning balance, January 1, | ($ | $ | |||||||||
| Amounts reclassified from accumulated other comprehensive income (loss) | ( | ( | |||||||||
| Net other comprehensive loss for the period | ( | ( | |||||||||
| Ending balance, September 30, | ($ | $ | |||||||||
The following table presents changes in accumulated other comprehensive income for Entergy Louisiana for the three months ended September 30, 2026 and 2025:
| Pension and Other Postretirement Plan Changes | |||||||||||
| 2026 | 2025 | ||||||||||
| (In Thousands) | |||||||||||
| Beginning balance, July 1, | $ | $ | |||||||||
| Amounts reclassified from accumulated other comprehensive income | ( | ( | |||||||||
| Net other comprehensive loss for the period | ( | ( | |||||||||
| Ending balance, September 30, | $ | $ | |||||||||
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The following table presents changes in accumulated other comprehensive income for Entergy Louisiana for the nine months ended September 30, 2026 and 2025:
| Pension and Other Postretirement Plan Changes | |||||||||||
| 2026 | 2025 | ||||||||||
| (In Thousands) | |||||||||||
| Beginning balance, January 1, | $ | $ | |||||||||
| Amounts reclassified from accumulated other comprehensive income | ( | ( | |||||||||
| Net other comprehensive loss for the period | ( | ( | |||||||||
| Ending balance, September 30, | $ | $ | |||||||||
Total reclassifications out of accumulated other comprehensive income (loss) (AOCI) for Entergy for the three months ended September 30, 2026 and 2025 are as follows:
| Amounts reclassified from AOCI | Income Statement Location | ||||||||||||||||
| 2026 | 2025 | ||||||||||||||||
| (In Thousands) | |||||||||||||||||
| Pension and other postretirement plan changes | |||||||||||||||||
| Amortization of prior service credit | $ | $ | (a) | ||||||||||||||
| Amortization of net gain | (a) | ||||||||||||||||
| Settlement loss | ( | (a) | |||||||||||||||
| Total amortization and settlement loss | |||||||||||||||||
| Income taxes | ( | ( | Income taxes | ||||||||||||||
| Total amortization and settlement loss (net of tax) | $ | $ | |||||||||||||||
| Total reclassifications for the period (net of tax) | $ | $ | |||||||||||||||
(a)These accumulated other comprehensive income (loss) components are included in the computation of net periodic pension and other postretirement cost. See Note 6 to the financial statements herein for additional details.
Total reclassifications out of accumulated other comprehensive income (loss) (AOCI) for Entergy for the nine months ended September 30, 2026 and 2025 are as follows:
| Amounts reclassified from AOCI | Income Statement Location | ||||||||||||||||
| 2026 | 2025 | ||||||||||||||||
| (In Thousands) | |||||||||||||||||
| Pension and other postretirement plan changes | |||||||||||||||||
| Amortization of prior service credit | $ | $ | (a) | ||||||||||||||
| Amortization of net gain (loss) | ( | (a) | |||||||||||||||
| Settlement loss | ( | (a) | |||||||||||||||
| Total amortization and settlement loss | |||||||||||||||||
| Income taxes | ( | ( | Income taxes | ||||||||||||||
| Total amortization and settlement loss (net of tax) | $ | $ | |||||||||||||||
| Total reclassifications for the period (net of tax) | $ | $ | |||||||||||||||
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(a)These accumulated other comprehensive income (loss) components are included in the computation of net periodic pension and other postretirement cost. See Note 6 to the financial statements herein for additional details.
Total reclassifications out of accumulated other comprehensive income (AOCI) for Entergy Louisiana for the three months ended September 30, 2026 and 2025 are as follows:
| Amounts reclassified from AOCI | Income Statement Location | |||||||||||||||||||
| 2026 | 2025 | |||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||
| Pension and other postretirement plan changes | ||||||||||||||||||||
| Amortization of prior service credit | $ | $ | (a) | |||||||||||||||||
| Amortization of net gain | (a) | |||||||||||||||||||
| Settlement loss | ( | (a) | ||||||||||||||||||
| Total amortization and settlement loss | ||||||||||||||||||||
| Income taxes | ( | ( | Income taxes | |||||||||||||||||
| Total amortization and settlement loss (net of tax) | $ | $ | ||||||||||||||||||
| Total reclassifications for the period (net of tax) | $ | $ | ||||||||||||||||||
(a)These accumulated other comprehensive income components are included in the computation of net periodic pension and other postretirement cost. See Note 6 to the financial statements herein for additional details.
Total reclassifications out of accumulated other comprehensive income (AOCI) for Entergy Louisiana for the nine months ended September 30, 2026 and 2025 are as follows:
| Amounts reclassified from AOCI | Income Statement Location | |||||||||||||||||||
| 2026 | 2025 | |||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||
| Pension and other postretirement plan changes | ||||||||||||||||||||
| Amortization of prior service credit | $ | $ | (a) | |||||||||||||||||
| Amortization of net gain | (a) | |||||||||||||||||||
| Settlement loss | ( | (a) | ||||||||||||||||||
| Total amortization and settlement loss | ||||||||||||||||||||
| Income taxes | ( | ( | Income taxes | |||||||||||||||||
| Total amortization and settlement loss (net of tax) | $ | $ | ||||||||||||||||||
| Total reclassifications for the period (net of tax) | $ | $ | ||||||||||||||||||
(a)These accumulated other comprehensive income components are included in the computation of net periodic pension and other postretirement cost. See Note 6 to the financial statements herein for additional details.
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NOTE 4. REVOLVING CREDIT FACILITIES, LINES OF CREDIT, SHORT-TERM BORROWINGS, AND LONG-TERM DEBT (Entergy Corporation, Entergy Arkansas, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy)
Entergy Corporation has in place a credit facility that has a borrowing capacity of $3 billion and expires in June 2031. The facility includes fronting commitments for the issuance of letters of credit against $20 million of the total borrowing capacity of the credit facility. The commitment fee is currently 0.225 % of the undrawn commitment amount. Commitment fees and interest rates on loans under the credit facility can fluctuate depending on the senior unsecured debt ratings of Entergy Corporation. Although there were no borrowings under the facility for the nine months ended September 30, 2026, the estimated interest rate as of September 30, 2026 that would have been applied to outstanding borrowings under the facility was 5.40 %. The following is a summary of the amounts outstanding and capacity available under the credit facility as of September 30, 2026:
| Capacity | Borrowings | Letters of Credit | Capacity Available | |||||||||||||||||
| (In Millions) | ||||||||||||||||||||
| $ | $ | $ | $ | |||||||||||||||||
Entergy Corporation’s credit facility includes a covenant requiring Entergy to maintain a consolidated debt ratio, as defined, of 65 % or less of its total capitalization. Entergy is in compliance with this covenant. If Entergy fails to meet this ratio, or if Entergy Corporation or one of the Registrant Subsidiaries (except Entergy New Orleans and System Energy) defaults on other indebtedness or is in bankruptcy or insolvency proceedings, an acceleration of the Entergy Corporation credit facility’s maturity date may occur.
Entergy Corporation has a commercial paper program with a Board-approved program limit of $2 billion. As of September 30, 2026, Entergy Corporation had $105 million of commercial paper outstanding. The weighted-average interest rate for the nine months ended September 30, 2026 was 4.05 %.
Entergy Arkansas, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, and Entergy Texas each had credit facilities available as of September 30, 2026 as follows:
| Company | Expiration Date | Amount of Facility | Interest Rate (a) | Amount Drawn as of September 30, 2026 | Letters of Credit Outstanding as of September 30, 2026 | |||||||||||||||||||||||||||
| Entergy Arkansas | April 2028 | $ | $ | $ | ||||||||||||||||||||||||||||
| Entergy Arkansas | June 2031 | $ | $ | $ | ||||||||||||||||||||||||||||
| Entergy Louisiana | June 2031 | $ | $ | $ | ||||||||||||||||||||||||||||
| Entergy Mississippi | June 2031 | $ | $ | $ | ||||||||||||||||||||||||||||
| Entergy New Orleans | June 2027 | $ | $ | $ | ||||||||||||||||||||||||||||
| Entergy Texas | June 2031 | $ | $ | $ | ||||||||||||||||||||||||||||
(a)The interest rate is the estimated interest rate as of September 30, 2026 that would have been applied to outstanding borrowings under the facility.
(b)Borrowings under this Entergy Arkansas credit facility may be secured by a security interest in its accounts receivable at Entergy Arkansas’s option.
(c)The credit facility includes fronting commitments for the issuance of letters of credit against a portion of the borrowing capacity of the facility as follows: $5 million for Entergy Arkansas; $15 million for Entergy Louisiana; $5 million for Entergy Mississippi; $10 million for Entergy New Orleans; and $25 million for Entergy Texas.
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The commitment fees on the credit facilities range from 0.075 0.375 65
In addition, Entergy Arkansas, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, and Entergy Texas each has one or more uncommitted standby letter of credit facilities as a means to post collateral to support its obligations to MISO and for other purposes. The following is a summary of the uncommitted standby letter of credit facilities as of September 30, 2026:
| Company | Amount of Uncommitted Facility | Letter of Credit Fee | Letters of Credit Issued as of September 30, 2026 (a) | |||||||||||||||||
| Entergy Arkansas | $ | $ | ||||||||||||||||||
| Entergy Arkansas | $ | $ | ||||||||||||||||||
| Entergy Louisiana | $ | $ | ||||||||||||||||||
| Entergy Louisiana | $ | $ | ||||||||||||||||||
| Entergy Mississippi | $ | $ | ||||||||||||||||||
| Entergy Mississippi | $ | $ | ||||||||||||||||||
| Entergy New Orleans | $ | $ | ||||||||||||||||||
| Entergy Texas | $ | $ | ||||||||||||||||||
| Entergy Texas | $ | $ | ||||||||||||||||||
(a)As of September 30, 2026, letters of credit posted with MISO covered financial transmission rights exposure of $3.2 million for Entergy Louisiana; $0.5 million for Entergy New Orleans; and $1.0 million for Entergy Texas. See Note 8 to the financial statements herein for discussion of financial transmission rights.
(b)As of September 30, 2026, the letters of credit issued for Entergy Louisiana under this facility include $43.1 million in MISO letters of credit and $20.0 million in non-MISO letters of credit outstanding.
(c)As of September 30, 2026, the letters of credit issued for Entergy Mississippi under this facility include $63.4 million in MISO letters of credit and $1.3 million in non-MISO letters of credit outstanding.
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The short-term borrowings of the Registrant Subsidiaries are limited to amounts authorized by the FERC. As of September 30, 2026, the FERC-authorized short-term borrowing limits for Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy were effective through January 2027, and the FERC-authorized short-term borrowing limit for Entergy Arkansas was effective through February 2028. In October 2026, Entergy Arkansas, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy received FERC-authorized short-term borrowing limits effective from November 2026 through October 2028. In addition to borrowings from commercial banks, these companies may also borrow from the Entergy system money pool and from other internal short-term borrowing arrangements. The money pool is an intercompany cash management program that makes possible intercompany borrowing and lending arrangements, and the money pool and the other internal borrowing arrangements are designed to reduce the Registrant Subsidiaries’ dependence on external short-term borrowings. Borrowings from internal and external short-term borrowings combined may not exceed the FERC-authorized limits. The following are the FERC-authorized limits for short-term borrowings and the outstanding short-term borrowings as of September 30, 2026 (aggregating both internal and external short-term borrowings) for the Registrant Subsidiaries:
| Authorized | Borrowings | ||||||||||
| (In Millions) | |||||||||||
| Entergy Arkansas | $ | $ | |||||||||
| Entergy Louisiana | $ | $ | |||||||||
| Entergy Mississippi | $ | $ | |||||||||
| Entergy New Orleans | $ | $ | |||||||||
| Entergy Texas | $ | $ | |||||||||
| System Energy | $ | $ | |||||||||
Variable Interest Entities (Entergy Corporation, Entergy Arkansas, Entergy Louisiana, and System Energy)
See Note 17 to the financial statements in the Form 10-K for a discussion of the consolidation of the nuclear fuel company variable interest entities (VIEs). To finance the acquisition and ownership of nuclear fuel, the nuclear fuel company VIEs have credit facilities, three of which previously provided for the issuance of commercial paper until such provisions relating to commercial paper were terminated in June 2026. The following is a summary of the nuclear fuel company VIE credit facilities as of September 30, 2026:
| Company | Expiration Date | Amount of Facility | Weighted- Average Interest Rate on Borrowings | Amount Outstanding as of September 30, 2026 | ||||||||||||||||||||||
| (Dollars in Millions) | ||||||||||||||||||||||||||
| Entergy Arkansas VIE | June 2029 | $ | $ | |||||||||||||||||||||||
| Entergy Louisiana River Bend VIE | June 2029 | $ | $ | |||||||||||||||||||||||
| Entergy Louisiana Waterford VIE | June 2029 | $ | $ | |||||||||||||||||||||||
| System Energy VIE | June 2029 | $ | $ | |||||||||||||||||||||||
The commitment fees on the credit facilities are 0.100 70
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The nuclear fuel company VIEs had notes payable that were included in debt on the respective balance sheets as of September 30, 2026 as follows:
| Company | Description | Amount | ||||||||||||
| Entergy Arkansas VIE | $ | |||||||||||||
| Entergy Arkansas VIE | $ | |||||||||||||
| Entergy Louisiana River Bend VIE | $ | |||||||||||||
| Entergy Louisiana Waterford VIE | $ | |||||||||||||
| System Energy VIE | $ | |||||||||||||
| System Energy VIE | $ | |||||||||||||
In accordance with regulatory treatment, interest on the nuclear fuel company VIEs’ debt arrangements, which currently include their credit facilities and long-term notes payable, is reported in fuel expense.
As of September 30, 2026, Entergy Louisiana and System Energy each had financing authorization from the FERC that extended through January 2027 for issuances by its nuclear fuel company VIEs, and Entergy Arkansas had financing authorization from the FERC that extended through February 2028 for issuances by its nuclear fuel company VIE. In October 2026, Entergy Arkansas, Entergy Louisiana, and System Energy obtained financing authorizations from the FERC that extend through October 2028.
Debt Issuances and Retirements
(Entergy Corporation)
In August 2026, Entergy Corporation issued $750 million of junior subordinated debentures due December 2056 (Series 2026A junior subordinated debentures) and $750 million of junior subordinated debentures due December 2058 (Series 2026B junior subordinated debentures). Entergy Corporation will pay interest at an annual rate of 6.500 % through December 14, 2036 for the Series 2026A junior subordinated debentures and through December 14, 2033 for the Series 2026B junior subordinated debentures. Commencing on December 15, 2036 for the Series 2026A junior subordinated debentures and on December 15, 2033 for the Series 2026B junior subordinated debentures, the annual rate will equal the five-year treasury rate as of the most recent reset interest determination date plus 1.877 % for the Series 2026A junior subordinated debentures and 2.030 % for the 2026B junior subordinated debentures. Entergy Corporation used the proceeds to repay a portion of its outstanding commercial paper, to repay, at maturity, its $750 million of 2.95 % senior notes due September 2026, and for general corporate purposes.
(Entergy Arkansas)
In January 2026, Entergy Arkansas issued $500 million of 4.95 % Series mortgage bonds due January 2036 and $500 million of 5.75 % Series mortgage bonds due January 2056. Entergy Arkansas used the proceeds, together with other funds, to repay, prior to maturity, its $600 million of 3.5 % Series mortgage bonds due April 2026. Entergy Arkansas expects to use the remaining proceeds, together with other funds, to finance a portion of the construction of generation projects, including the Ironwood Power Station and the Arkansas Cypress Solar facility, and for general corporate purposes.
In July 2026 the Entergy Arkansas nuclear fuel company VIE issued $120 million of 5.28 % Series P intermediate term secured notes due July 2031. The Entergy Arkansas nuclear fuel company VIE used the proceeds to repay, at maturity, its $90 million of 1.84 % Series N intermediate term secured notes due July 2026 and expects to use the remaining funds to purchase additional nuclear fuel.
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Notes to Financial Statements
(Entergy Louisiana)
In January 2026, Entergy Louisiana redeemed, at maturity, $250 million of 4.44 % Series mortgage bonds.
In February 2026, Entergy Louisiana issued $750 million of 4.90 % Series mortgage bonds due April 2036 and $750 million of 5.65 % Series mortgage bonds due April 2056. Entergy Louisiana has used or expects to use the proceeds, together with other funds, to finance construction of the Franklin Farms Power Station Units 1 and 2 project, the Waterford 5 Power Station project, and the Westlake Power Station project, to support storm restoration costs related to Winter Storm Fern, and for general corporate purposes.
In August 2026, Entergy Louisiana issued $500 million of 5.50 % Series mortgage bonds due September 2036 and $500 million of 6.20 % Series mortgage bonds due September 2056. Entergy Louisiana has used or expects to use the proceeds to finance construction of a portion or all of its capital plan, including the construction of any or all of the Richland Parish Units 1-4 project, the Pointe Coupee Units 1-3 project, the Waterford 5 Power Station project, the Franklin Farms Power Station Units 1 and 2 project, the Amite South transmission projects, the Westlake Power Station project, and battery energy storage systems, to repay, at maturity, its outstanding $400 million of 2.40 % Series mortgage bonds due October 2026, and for general corporate purposes.
In September 2026, the Entergy Louisiana Waterford nuclear fuel company VIE issued $90 million of 5.28 % Series K intermediate term secured notes due September 2031. The Entergy Louisiana Waterford nuclear fuel company VIE used the proceeds to repay, at maturity, its $70 million of 5.94 % Series J intermediate term secured notes due September 2026 and expects to use the remaining funds to purchase additional nuclear fuel.
(Entergy Mississippi)
In March 2026, Entergy Mississippi issued $650 million of 5.05 % Series mortgage bonds due April 2036. Entergy Mississippi has used or expects to use the proceeds, together with other funds, to finance construction of the Traceview Advanced Power Station and Vicksburg Advanced Power Station, to finance, on an interim basis, storm restoration costs related to Winter Storm Fern, and for general corporate purposes.
(Entergy New Orleans)
In May 2026, Entergy New Orleans issued $35 million of 5.91 % Series mortgage bonds due June 2036 and $55 million of 6.65 % Series mortgage bonds due June 2056. Entergy New Orleans used the proceeds to repay, at maturity, its $85 million of 4 % Series mortgage bonds due June 2026 and for general corporate purposes.
(Entergy Texas)
In May 2026, Entergy Texas issued $425 million of 5.20 % Series mortgage bonds due June 2036. Entergy Texas has used or expects to use the proceeds, together with other funds, to finance construction of the Orange County Advanced Power Station and the Lone Star Power Station, to repay, at maturity, its $130 million of 1.50 % Series mortgage bonds due September 2026, and for general corporate purposes.
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Fair Value
The book value and the fair value of long-term debt for Entergy and the Registrant Subsidiaries as of September 30, 2026 were as follows:
| Book Value of Long-Term Debt | Fair Value of Long-Term Debt (a) | ||||||||||
| (In Thousands) | |||||||||||
| Entergy | $ | $ | |||||||||
| Entergy Arkansas | $ | $ | |||||||||
| Entergy Louisiana | $ | $ | |||||||||
| Entergy Mississippi | $ | $ | |||||||||
| Entergy New Orleans | $ | $ | |||||||||
| Entergy Texas | $ | $ | |||||||||
| System Energy | $ | $ | |||||||||
(a)Fair values were classified as Level 2 in the fair value hierarchy discussed in Note 8 to the financial statements herein.
The book value and the fair value of long-term debt for Entergy and the Registrant Subsidiaries as of December 31, 2025 were as follows:
| Book Value of Long-Term Debt | Fair Value of Long-Term Debt (a) | ||||||||||
| (In Thousands) | |||||||||||
| Entergy | $ | $ | |||||||||
| Entergy Arkansas | $ | $ | |||||||||
| Entergy Louisiana | $ | $ | |||||||||
| Entergy Mississippi | $ | $ | |||||||||
| Entergy New Orleans | $ | $ | |||||||||
| Entergy Texas | $ | $ | |||||||||
| System Energy | $ | $ | |||||||||
(a)Fair values were classified as Level 2 in the fair value hierarchy discussed in Note 8 to the financial statements herein.
NOTE 5. STOCK-BASED COMPENSATION (Entergy Corporation)
Entergy grants stock and stock-based awards, which are described more fully in Note 12 to the financial statements in the Form 10-K. Awards under Entergy’s plans generally vest over three years .
Stock Options
In January 2026 the Board approved and Entergy granted long-term incentive awards in the form of options on 298,829 shares of its common stock under the 2019 Omnibus Incentive Plan with a fair value of $20.81 per option. As of September 30, 2026, there were options on 2,971,677 shares of common stock outstanding with a weighted-average exercise price of $60.47 . The intrinsic value, which has no effect on net income, of the outstanding stock options is calculated by the positive difference between the weighted-average exercise price of the
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stock options granted and Entergy Corporation’s common stock price as of September 30, 2026. The aggregate intrinsic value of the stock options outstanding as of September 30, 2026 was $115.3 million.
The following table includes financial information for stock options for the three and nine months ended September 30, 2026 and 2025:
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| (In Millions) | |||||||||||||||||||||||
| Compensation expense included in Entergy’s consolidated net income | $ | $ | $ | $ | |||||||||||||||||||
| Tax benefit recognized in Entergy’s consolidated net income | $ | $ | $ | $ | |||||||||||||||||||
| Compensation cost capitalized as part of fixed assets and materials and supplies | $ | $ | $ | $ | |||||||||||||||||||
Other Equity Awards
In January 2026 the Board approved and Entergy granted long-term incentive awards in the form of 461,708 restricted stock awards, 20,954 restricted stock units, and 195,692 performance units under the 2019 Omnibus Incentive Plan. The restricted stock awards and restricted stock units were made effective on January 29, 2026, and were valued at $96.03 per share, which was the closing price of Entergy Corporation’s common stock on the grant date. Shares of restricted stock have the same dividend and voting rights as other common stock, are considered issued and outstanding shares of Entergy upon vesting, and are expensed ratably over the three-year vesting period. One-third of the restricted stock awards and accrued dividends will vest upon each anniversary of the grant date. The restricted stock units do not have voting rights and are not considered issued and outstanding shares of Entergy prior to vesting. One-third of the restricted stock units will vest upon each anniversary of the grant date and are paid in the form of shares of Entergy Corporation’s common stock. Dividend equivalents accrue on the restricted stock units and are converted to additional restricted stock units, which are subject to the same vesting schedule as the underlying restricted stock units. The restricted stock units are expensed ratably over the three-year vesting period.
The performance units represent the value of, and are settled with, one share of Entergy Corporation common stock at the end of the three-year performance period, plus dividends accrued during the performance period on the number of performance units earned. For the 2026-2028 performance period, performance will be measured based eighty percent on relative total shareholder return, ten percent on an environmental stewardship achievement measure, and ten percent on a reliability achievement measure. The performance units were granted on January 29, 2026 and eighty percent were valued at $118.24 per share based on various factors, primarily market conditions; and both the ten percent for the environmental stewardship achievement and the ten percent for the reliability achievement were valued at $96.03 per share, the closing price of Entergy Corporation’s common stock on the grant date. Performance units do not have voting rights and are not considered issued and outstanding shares of Entergy prior to vesting. Performance units are expensed ratably over the three-year vesting period, and compensation cost for the portion of the award based on the environmental stewardship achievement measure and the reliability achievement measure will be adjusted based on the number of units that ultimately vest. See Note 12 to the financial statements in the Form 10-K for a description of the Long-Term Performance Unit Program.
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The following table includes financial information for other outstanding equity awards for the three and nine months ended September 30, 2026 and 2025:
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| (In Millions) | |||||||||||||||||||||||
| Compensation expense included in Entergy’s consolidated net income | $ | $ | $ | $ | |||||||||||||||||||
| Tax benefit recognized in Entergy’s consolidated net income | $ | $ | $ | $ | |||||||||||||||||||
| Compensation cost capitalized as part of fixed assets and materials and supplies | $ | $ | $ | $ | |||||||||||||||||||
NOTE 6. RETIREMENT AND OTHER POSTRETIREMENT BENEFITS (Entergy Corporation, Entergy Arkansas, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy)
Components of Qualified Net Pension Cost
Entergy’s qualified net pension costs, including amounts capitalized, for the third quarters of 2026 and 2025, included the following components:
| 2026 | 2025 | ||||||||||
| (In Thousands) | |||||||||||
| Service cost - benefits earned during the period | $ | $ | |||||||||
| Interest cost on projected benefit obligation | |||||||||||
| Expected return on assets | ( | ( | |||||||||
| Recognized net loss | |||||||||||
| Settlement charges | |||||||||||
| Asset transfer gain (a) | ( | ||||||||||
| Net pension cost | $ | $ | |||||||||
(a)See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy Louisiana and Entergy New Orleans natural gas distribution businesses on July 1, 2025.
Entergy’s qualified net pension costs, including amounts capitalized, for the nine months ended September 30, 2026 and 2025, included the following components:
| 2026 | 2025 | ||||||||||
| (In Thousands) | |||||||||||
| Service cost - benefits earned during the period | $ | $ | |||||||||
| Interest cost on projected benefit obligation | |||||||||||
| Expected return on assets | ( | ( | |||||||||
| Recognized net loss | |||||||||||
| Settlement charges | |||||||||||
Asset transfer gain (a) | ( | ||||||||||
| Net pension cost | $ | $ | |||||||||
(a)See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy Louisiana and Entergy New Orleans natural gas distribution businesses on July 1, 2025.
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The Registrant Subsidiaries’ qualified net pension costs, including amounts capitalized, for their current and former employees for the third quarters of 2026 and 2025, included the following components:
| 2026 | Entergy Arkansas | Entergy Louisiana | Entergy Mississippi | Entergy New Orleans | Entergy Texas | System Energy | ||||||||||||||||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||||||||||||||||||||
| Service cost - benefits earned during the period | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Interest cost on projected benefit obligation | ||||||||||||||||||||||||||||||||||||||
| Expected return on assets | ( | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||
| Recognized net loss | ||||||||||||||||||||||||||||||||||||||
| Net pension cost | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| 2025 | Entergy Arkansas | Entergy Louisiana | Entergy Mississippi | Entergy New Orleans | Entergy Texas | System Energy | ||||||||||||||||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||||||||||||||||||||
| Service cost - benefits earned during the period | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Interest cost on projected benefit obligation | ||||||||||||||||||||||||||||||||||||||
| Expected return on assets | ( | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||
| Recognized net loss | ||||||||||||||||||||||||||||||||||||||
| Settlement charges | ||||||||||||||||||||||||||||||||||||||
| Asset transfer gain (a) | ( | ( | ||||||||||||||||||||||||||||||||||||
| Net pension cost | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
(a)See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy Louisiana and Entergy New Orleans natural gas distribution businesses on July 1, 2025.
The Registrant Subsidiaries’ qualified net pension costs, including amounts capitalized, for their current and former employees for the nine months ended September 30, 2026 and 2025, included the following components:
| 2026 | Entergy Arkansas | Entergy Louisiana | Entergy Mississippi | Entergy New Orleans | Entergy Texas | System Energy | ||||||||||||||||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||||||||||||||||||||
| Service cost - benefits earned during the period | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Interest cost on projected benefit obligation | ||||||||||||||||||||||||||||||||||||||
| Expected return on assets | ( | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||
| Recognized net loss | ||||||||||||||||||||||||||||||||||||||
| Net pension cost | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
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| 2025 | Entergy Arkansas | Entergy Louisiana | Entergy Mississippi | Entergy New Orleans | Entergy Texas | System Energy | ||||||||||||||||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||||||||||||||||||||
| Service cost - benefits earned during the period | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Interest cost on projected benefit obligation | ||||||||||||||||||||||||||||||||||||||
| Expected return on assets | ( | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||
| Recognized net loss | ||||||||||||||||||||||||||||||||||||||
| Settlement charges | ||||||||||||||||||||||||||||||||||||||
| Asset transfer gain (a) | ( | ( | ||||||||||||||||||||||||||||||||||||
| Net pension cost | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
(a)See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy Louisiana and Entergy New Orleans natural gas distribution businesses on July 1, 2025.
Non-Qualified Net Pension Cost
Entergy recognized $2.4 million and $6.1 million in pension cost for its non-qualified pension plans for the third quarters of 2026 and 2025, respectively. For the third quarter of 2026, there were no settlement charges related to the payment of lump sum benefits out of the plan. Reflected in the pension cost for non-qualified pension plans in the third quarter of 2025 were settlement charges of $3.6 million related to the payment of lump sum benefits out of the plan. Entergy recognized $7.2 million and $11.1 million in pension cost for its non-qualified pension plans for the nine months ended September 30, 2026 and 2025, respectively. For the nine months ended September 30, 2026, there were no settlement charges related to the payment of lump sum benefits out of the plan. Reflected in the pension cost for non-qualified pension plans for the nine months ended September 30, 2025 were settlement charges of $3.6 million related to the payment of lump sum benefits out of the plan.
The Registrant Subsidiaries recognized the following pension cost for their current and former employees for their non-qualified pension plans for the third quarters of 2026 and 2025:
| Entergy Arkansas | Entergy Louisiana | Entergy Mississippi | Entergy New Orleans | Entergy Texas | |||||||||||||||||||||||||
| (In Thousands) | |||||||||||||||||||||||||||||
| 2026 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| 2025 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
The Registrant Subsidiaries recognized the following pension cost for their current and former employees for their non-qualified pension plans for the nine months ended September 30, 2026 and 2025:
| Entergy Arkansas | Entergy Louisiana | Entergy Mississippi | Entergy New Orleans | Entergy Texas | |||||||||||||||||||||||||
| (In Thousands) | |||||||||||||||||||||||||||||
| 2026 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| 2025 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
For the third quarter of 2026, there were no 215 no
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months ended September 30, 2025, there were settlement charges of $215
Components of Net Other Postretirement Benefits Cost (Income)
Entergy’s net other postretirement benefits income, including amounts capitalized, for the third quarters of 2026 and 2025 included the following components:
| 2026 | 2025 | ||||||||||
| (In Thousands) | |||||||||||
| Service cost - benefits earned during the period | $ | $ | |||||||||
| Interest cost on accumulated postretirement benefit obligation (APBO) | |||||||||||
| Expected return on assets | ( | ( | |||||||||
| Amortization of prior service credit | ( | ( | |||||||||
| Recognized net gain | ( | ( | |||||||||
| Settlement credit | ( | ||||||||||
| Curtailment credit | ( | ||||||||||
| Asset transfer loss (a) | |||||||||||
| Net other postretirement benefits cost (income) | ($ | $ | |||||||||
(a)See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy Louisiana and Entergy New Orleans natural gas distribution businesses on July 1, 2025.
Entergy’s net other postretirement benefits cost (income), including amounts capitalized, for the nine months ended September 30, 2026 and 2025 included the following components:
| 2026 | 2025 | ||||||||||
| (In Thousands) | |||||||||||
| Service cost - benefits earned during the period | $ | $ | |||||||||
Interest cost on APBO | |||||||||||
| Expected return on assets | ( | ( | |||||||||
| Amortization of prior service credit | ( | ( | |||||||||
| Recognized net gain | ( | ( | |||||||||
| Settlement credit | ( | ||||||||||
| Curtailment credit | ( | ||||||||||
| Asset transfer loss (a) | |||||||||||
| Net other postretirement benefits cost (income) | $ | ($ | |||||||||
(a)See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy Louisiana and Entergy New Orleans natural gas distribution businesses on July 1, 2025.
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The Registrant Subsidiaries’ net other postretirement benefits cost (income), including amounts capitalized, for their current and former employees for the third quarters of 2026 and 2025 included the following components:
| 2026 | Entergy Arkansas | Entergy Louisiana | Entergy Mississippi | Entergy New Orleans | Entergy Texas | System Energy | ||||||||||||||||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||||||||||||||||||||
| Service cost - benefits earned during the period | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Interest cost on APBO | ||||||||||||||||||||||||||||||||||||||
| Expected return on assets | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||
| Amortization of prior service cost (credit) | ( | ( | ( | |||||||||||||||||||||||||||||||||||
| Recognized net (gain) loss | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
| Net other postretirement benefits cost (income) | ($ | $ | ($ | ($ | ($ | ($ | ||||||||||||||||||||||||||||||||
| 2025 | Entergy Arkansas | Entergy Louisiana | Entergy Mississippi | Entergy New Orleans | Entergy Texas | System Energy | ||||||||||||||||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||||||||||||||||||||
| Service cost - benefits earned during the period | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Interest cost on APBO | ||||||||||||||||||||||||||||||||||||||
| Expected return on assets | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||
| Amortization of prior service cost (credit) | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||
| Recognized net (gain) loss | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||
| Settlement credit | ( | ( | ||||||||||||||||||||||||||||||||||||
| Curtailment credit | ( | ( | ||||||||||||||||||||||||||||||||||||
| Asset transfer (gain) loss (a) | ( | |||||||||||||||||||||||||||||||||||||
| Net other postretirement benefits cost (income) | ($ | ($ | ($ | $ | ($ | ($ | ||||||||||||||||||||||||||||||||
(a)See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy Louisiana and Entergy New Orleans natural gas distribution businesses on July 1, 2025.
The Registrant Subsidiaries’ net other postretirement benefits cost (income), including amounts capitalized, for their current and former employees for the nine months ended September 30, 2026 and 2025 included the following components:
| 2026 | Entergy Arkansas | Entergy Louisiana | Entergy Mississippi | Entergy New Orleans | Entergy Texas | System Energy | ||||||||||||||||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||||||||||||||||||||
| Service cost - benefits earned during the period | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Interest cost on APBO | ||||||||||||||||||||||||||||||||||||||
| Expected return on assets | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||
| Amortization of prior service cost (credit) | ( | ( | ( | |||||||||||||||||||||||||||||||||||
| Recognized net (gain) loss | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
| Net other postretirement benefits cost (income) | ($ | $ | ($ | ($ | ($ | ($ | ||||||||||||||||||||||||||||||||
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| 2025 | Entergy Arkansas | Entergy Louisiana | Entergy Mississippi | Entergy New Orleans | Entergy Texas | System Energy | ||||||||||||||||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||||||||||||||||||||
| Service cost - benefits earned during the period | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
| Interest cost on APBO | ||||||||||||||||||||||||||||||||||||||
| Expected return on assets | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||
| Amortization of prior service cost (credit) | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||
| Recognized net (gain) loss | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||
| Settlement credit | ( | ( | ||||||||||||||||||||||||||||||||||||
| Curtailment credit | ( | ( | ||||||||||||||||||||||||||||||||||||
| Asset transfer (gain) loss (a) | ( | |||||||||||||||||||||||||||||||||||||
| Net other postretirement benefits cost (income) | ($ | ($ | ($ | $ | ($ | ($ | ||||||||||||||||||||||||||||||||
(a)See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy Louisiana and Entergy New Orleans natural gas distribution businesses on July 1, 2025.
Reclassification out of Accumulated Other Comprehensive Income (Loss)
Entergy and Entergy Louisiana reclassified the following costs out of accumulated other comprehensive income (loss) (before taxes and including amounts capitalized) for the third quarters of 2026 and 2025:
| 2026 | Qualified Pension Costs | Other Postretirement Costs | Non-Qualified Pension Costs | Total | ||||||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||||||||
| Entergy | ||||||||||||||||||||||||||
| Amortization of prior service credit (cost) | $ | $ | ($ | $ | ||||||||||||||||||||||
| Amortization of net gain (loss) | ( | ( | ||||||||||||||||||||||||
| ($ | $ | ($ | $ | |||||||||||||||||||||||
| Entergy Louisiana | ||||||||||||||||||||||||||
| Amortization of prior service credit | $ | $ | $ | $ | ||||||||||||||||||||||
| Amortization of net gain (loss) | ( | ( | ||||||||||||||||||||||||
| ($ | $ | ($ | $ | |||||||||||||||||||||||
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| 2025 | Qualified Pension Costs | Other Postretirement Costs | Non-Qualified Pension Costs | Total | ||||||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||||||||
| Entergy | ||||||||||||||||||||||||||
| Amortization of prior service credit (cost) | $ | $ | ($ | $ | ||||||||||||||||||||||
| Amortization of net gain (loss) | ( | ( | ||||||||||||||||||||||||
| Settlement loss | ( | ( | ( | |||||||||||||||||||||||
| ($ | $ | ($ | $ | |||||||||||||||||||||||
| Entergy Louisiana | ||||||||||||||||||||||||||
| Amortization of prior service credit | $ | $ | $ | $ | ||||||||||||||||||||||
| Amortization of net gain (loss) | ( | |||||||||||||||||||||||||
| Settlement loss | ( | ( | ||||||||||||||||||||||||
| ($ | $ | $ | $ | |||||||||||||||||||||||
Entergy and Entergy Louisiana reclassified the following costs out of accumulated other comprehensive income (loss) (before taxes and including amounts capitalized) for the nine months ended September 30, 2026 and 2025:
| 2026 | Qualified Pension Costs | Other Postretirement Costs | Non-Qualified Pension Costs | Total | ||||||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||||||||
| Entergy | ||||||||||||||||||||||||||
| Amortization of prior service credit (cost) | $ | $ | ($ | $ | ||||||||||||||||||||||
| Amortization of net loss | ( | ( | ( | ( | ||||||||||||||||||||||
| ($ | $ | ($ | $ | |||||||||||||||||||||||
| Entergy Louisiana | ||||||||||||||||||||||||||
| Amortization of prior service credit (cost) | $ | $ | ($ | $ | ||||||||||||||||||||||
| Amortization of net gain (loss) | ( | ( | ||||||||||||||||||||||||
| ($ | $ | ($ | $ | |||||||||||||||||||||||
| 2025 | Qualified Pension Costs | Other Postretirement Costs | Non-Qualified Pension Costs | Total | ||||||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||||||||
| Entergy | ||||||||||||||||||||||||||
| Amortization of prior service credit (cost) | $ | $ | ($ | $ | ||||||||||||||||||||||
| Amortization of net gain (loss) | ( | ( | ||||||||||||||||||||||||
| Settlement loss | ( | ( | ( | |||||||||||||||||||||||
| ($ | $ | ($ | $ | |||||||||||||||||||||||
| Entergy Louisiana | ||||||||||||||||||||||||||
| Amortization of prior service credit | $ | $ | $ | $ | ||||||||||||||||||||||
| Amortization of net gain (loss) | ( | ( | ||||||||||||||||||||||||
| Settlement loss | ( | ( | ||||||||||||||||||||||||
| ($ | $ | ($ | $ | |||||||||||||||||||||||
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Notes to Financial Statements
Accounting for Pension and Other Postretirement Benefits
In accordance with accounting standards, the other components of net benefit cost are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations and are presented by Entergy in miscellaneous - net in other income. In addition, non-service benefit costs previously eligible for capitalization into property, plant, and equipment are being deferred to a regulatory asset/liability and will be amortized over the estimated lives of the respective assets.
Employer Contributions
Based on current assumptions, Entergy expects to contribute $200 million to its qualified pension plans in 2026. As of September 30, 2026, Entergy had contributed $123.4 million to its pension plans. Based on current assumptions, the Registrant Subsidiaries expect to contribute the following to qualified pension plans for their current and former employees in 2026:
| Entergy Arkansas | Entergy Louisiana | Entergy Mississippi | Entergy New Orleans | Entergy Texas | System Energy | ||||||||||||||||||||||||||||||
| (In Thousands) | |||||||||||||||||||||||||||||||||||
Expected 2026 pension contributions | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Pension contributions made through September 2026 | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Remaining estimated pension contributions to be made in 2026 | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
NOTE 7. BUSINESS SEGMENT INFORMATION (Entergy Corporation, Entergy Arkansas, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy)
Entergy has a single reportable segment, Utility, which includes the generation, transmission, distribution, and sale of electric power in portions of Arkansas, Mississippi, Texas, and Louisiana, including the City of New Orleans; and included operation of a small natural gas distribution business in portions of Louisiana through June 30, 2025. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy Louisiana and Entergy New Orleans natural gas distribution businesses on July 1, 2025. Parent & Other includes the parent company, Entergy Corporation, and other business activity, including Entergy’s non-utility operations business, which is an operating segment that does not meet the quantitative thresholds for determining reportable segments.
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The following table includes operating revenues and significant expense categories regularly provided to the chief operating decision maker for the Utility segment, a reconciliation of Utility operating revenues to Entergy’s consolidated operating revenues, and a reconciliation of Utility net income to consolidated net income and net income attributable to Entergy Corporation for the three and nine months ended September 30, 2026 and 2025:
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||
| (In Thousands) | (In Thousands) | |||||||||||||||||||||||||
| Utility operating revenues | $ | $ | $ | $ | ||||||||||||||||||||||
| Reconciliation of revenues: | ||||||||||||||||||||||||||
| Other revenues (a) | ||||||||||||||||||||||||||
| Elimination of intersegment revenues | ( | ( | ( | |||||||||||||||||||||||
| Consolidated operating revenues | ||||||||||||||||||||||||||
| Less Utility expenses and other items: | ||||||||||||||||||||||||||
| Fuel, fuel-related expenses, and gas purchased for resale | ||||||||||||||||||||||||||
| Purchased power | ||||||||||||||||||||||||||
| Other operation and maintenance expenses | ||||||||||||||||||||||||||
| Other regulatory charges (credits) - net | ( | ( | ( | |||||||||||||||||||||||
| Other Utility items (b) | ||||||||||||||||||||||||||
| Utility net income | ||||||||||||||||||||||||||
| Reconciliation of net income: | ||||||||||||||||||||||||||
| Other loss | ( | ( | ( | ( | ||||||||||||||||||||||
| Elimination of intersegment profit | ( | ( | ( | ( | ||||||||||||||||||||||
| Consolidated net income | ||||||||||||||||||||||||||
| Preferred dividend requirements of subsidiaries and noncontrolling interests (c) | ||||||||||||||||||||||||||
| Net income attributable to Entergy Corporation | $ | $ | $ | $ | ||||||||||||||||||||||
(a)See Note 12 to the financial statements herein and Note 19 to the financial statements in the Form 10-K for discussion of other revenues.
(b)Other Utility items includes nuclear refueling outage expenses, asset write-offs, decommissioning expenses, taxes other than income taxes, depreciation and amortization expenses, other income, interest expense, and income tax expense.
(c)Preferred dividend requirements of subsidiaries and noncontrolling interests is substantially derived from the Utility segment. See Note 6 to the financial statements in the Form 10-K for discussion of preferred stock and noncontrolling interests.
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Notes to Financial Statements
The following table presents segment financial information for Entergy’s single reportable segment, Utility, and a reconciliation to the corresponding consolidated amounts for Entergy Corporation for the three months ended September 30, 2026 and 2025:
| Utility | Parent & Other | Eliminations | Consolidated | |||||||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||||||||
| 2026 | ||||||||||||||||||||||||||
| Depreciation, amortization, and decommissioning | $ | $ | $ | $ | ||||||||||||||||||||||
| Interest and investment income | $ | $ | ($ | $ | ||||||||||||||||||||||
| Interest expense | $ | $ | ($ | $ | ||||||||||||||||||||||
| Income taxes | $ | ($ | $ | $ | ||||||||||||||||||||||
| 2025 | ||||||||||||||||||||||||||
| Asset write-offs, impairments, and related charges | $ | $ | $ | $ | ||||||||||||||||||||||
| Depreciation, amortization, and decommissioning | $ | $ | $ | $ | ||||||||||||||||||||||
| Interest and investment income | $ | $ | ($ | $ | ||||||||||||||||||||||
| Interest expense | $ | $ | ($ | $ | ||||||||||||||||||||||
| Income taxes | $ | ($ | $ | $ | ||||||||||||||||||||||
The following table presents segment financial information for Entergy’s single reportable segment, Utility, and a reconciliation to the corresponding consolidated amounts for Entergy Corporation for the nine months ended September 30, 2026 and 2025:
| Utility | Parent & Other | Eliminations | Consolidated | |||||||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||||||||
| 2026 | ||||||||||||||||||||||||||
| Depreciation, amortization, and decommissioning | $ | $ | $ | $ | ||||||||||||||||||||||
| Interest and investment income | $ | $ | ($ | $ | ||||||||||||||||||||||
| Interest expense | $ | $ | ($ | $ | ||||||||||||||||||||||
| Income taxes | $ | ($ | $ | $ | ||||||||||||||||||||||
Total assets as of September 30, 2026 | $ | $ | ($ | $ | ||||||||||||||||||||||
| Total expenditures for additions to long-lived assets | $ | ($ | $ | $ | ||||||||||||||||||||||
| 2025 | ||||||||||||||||||||||||||
| Asset write-offs, impairments, and related charges | $ | $ | $ | $ | ||||||||||||||||||||||
| Depreciation, amortization, and decommissioning | $ | $ | $ | $ | ||||||||||||||||||||||
| Interest and investment income | $ | $ | ($ | $ | ||||||||||||||||||||||
| Interest expense | $ | $ | ($ | $ | ||||||||||||||||||||||
| Income taxes | $ | ($ | $ | $ | ||||||||||||||||||||||
Total assets as of December 31, 2025 | $ | $ | ($ | $ | ||||||||||||||||||||||
| Total expenditures for additions to long-lived assets | $ | $ | $ | $ | ||||||||||||||||||||||
Eliminations are primarily intersegment activity. All of Entergy’s goodwill is related to the Utility segment.
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Notes to Financial Statements
Registrant Subsidiaries
Entergy Arkansas, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, and Entergy Texas each has one one
NOTE 8. RISK MANAGEMENT AND FAIR VALUES (Entergy Corporation, Entergy Arkansas, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy)
Market Risk
In the normal course of business, Entergy is exposed to a number of market risks. Market risk is the potential loss that Entergy may incur as a result of changes in the market or fair value of a particular commodity or instrument. All financial and commodity-related instruments, including derivatives, are subject to market risk including commodity price risk, equity price, and interest rate risk. Entergy uses derivatives primarily to mitigate commodity price risk associated with the price of fuel and to mitigate interest rate exposure related to certain financing agreements.
The Utility has limited exposure to the effects of market risk because it operates primarily under cost-based rate regulation. To the extent approved by their retail regulators, the Utility operating companies use commodity and financial instruments to hedge the exposure to price volatility inherent in their purchased power, fuel, and gas purchased for resale costs, that are recovered from customers.
Derivatives
Entergy designates a significant portion of its derivative instruments as normal purchase/normal sale transactions due to their physical settlement provisions, including power purchase and sales agreements, fuel purchase agreements, and capacity contracts. Certain derivative instruments do not qualify for designation as normal purchase/normal sale transactions due to their financial settlement provisions. See further discussion below regarding the accounting for these derivative instruments.
In 2025, Entergy Texas entered into interest rate swaps, accounted for as derivatives, to manage interest rate risks associated with Entergy Texas’s build-to-suit lease arrangement for the Legend Power Station. See Note 8 to the financial statements in the Form 10-K for further discussion of the build-to-suit lease arrangement for the Legend Power Station. These interest rate swaps are not designated as hedging instruments. Interest will be calculated as the sum of the Secured Overnight Financing Rate plus the blended spreads per the build-to-suit lease arrangement, compounded monthly, with one cash settlement per year over the approximate two year construction period. The notional volume of the hedge was calculated based on the expected costs for the Legend Power Station at the time Entergy Texas entered into the interest rate swaps. Changes in the fair value of these interest rate swaps are recognized each period, with gains and losses deferred as a regulatory asset or liability. The interest rate swaps run through January 31, 2028. The total notional volume is up to $1.1
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Notes to Financial Statements
Entergy manages fuel price volatility for Entergy Louisiana and Entergy Mississippi through the purchase of natural gas swaps that financially settle against either the average Henry Hub Gas Daily prices or the NYMEX Henry Hub. These swaps are marked-to-market through fuel expense with offsetting regulatory assets or liabilities. All benefits or costs of the program are recorded in fuel costs. The notional volumes of these swaps are based on a portion of projected annual exposure to gas price volatility for electric generation at Entergy Louisiana and Entergy Mississippi. The maximum length of time over which Entergy has executed natural gas swaps as of September 30, 2026 is 4.6 years for Entergy Louisiana and 6 months for Entergy Mississippi. The total volume of natural gas swaps outstanding as of September 30, 2026 is 26,101,900 MMBtu for Entergy, including 18,421,000 MMBtu for Entergy Louisiana and 7,680,900 MMBtu for Entergy Mississippi. Credit support for these natural gas swaps is covered by master agreements that do not require Entergy to provide collateral based on mark-to-market value, but do carry adequate assurance language that may lead to requests for collateral. Prior to the sale of the Entergy New Orleans natural gas distribution business, Entergy also managed fuel price volatility related to projected winter purchases for gas distribution at Entergy New Orleans through the purchase of natural gas swaps. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy New Orleans and Entergy Louisiana natural gas distribution businesses on July 1, 2025.
During the second quarter 2026, Entergy participated in the annual financial transmission rights auction process for the MISO planning year of June 1, 2026 through May 31, 2027. Financial transmission rights are derivative instruments that represent economic hedges of future congestion charges that will be incurred in serving Entergy’s customer load. They are not designated as hedging instruments. Entergy initially records financial transmission rights at their estimated fair value and subsequently adjusts the carrying value to their estimated fair value at the end of each accounting period prior to settlement. Unrealized gains or losses on financial transmission rights held by the non-utility operations are included in operating revenues. The Utility operating companies recognize regulatory liabilities or assets for unrealized gains or losses on financial transmission rights. The total volume of financial transmission rights outstanding as of September 30, 2026 is 94,397 GWh for Entergy, including 25,233 GWh for Entergy Arkansas, 38,735 GWh for Entergy Louisiana, 11,430 GWh for Entergy Mississippi, 4,008 GWh for Entergy New Orleans, and 14,539 GWh for Entergy Texas. Credit support for financial transmission rights held by the Utility operating companies is covered by cash and/or letters of credit issued by each Utility operating company as required by MISO. No No
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Notes to Financial Statements
The fair values of Entergy’s derivative instruments not designated as hedging instruments on the consolidated balance sheets as of September 30, 2026 and December 31, 2025 are shown in the table below. Certain investments, including those not designated as hedging instruments, are subject to master netting agreements and are presented in the balance sheet on a net basis in accordance with accounting guidance for derivatives and hedging.
| Instrument | Balance Sheet Location | Gross Fair Value (a) | Offsetting Position (b) | Net Fair Value (c) (d) | ||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
| 2026 | ||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||
| Financial transmission rights | Prepayments and other | $ | ($ | $ | ||||||||||||||||||||||
| Interest rate swaps | Prepayments and other | $ | $ | $ | ||||||||||||||||||||||
| Natural gas swaps | Other deferred debits and other assets | $ | $ | $ | ||||||||||||||||||||||
| Interest rate swaps | Other deferred debits and other assets | $ | $ | $ | ||||||||||||||||||||||
| Liabilities: | ||||||||||||||||||||||||||
| Natural gas swaps | Other current liabilities | $ | $ | $ | ||||||||||||||||||||||
| 2025 | ||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||
| Financial transmission rights | Prepayments and other | $ | $ | $ | ||||||||||||||||||||||
| Interest rate swaps | Prepayments and other | $ | $ | $ | ||||||||||||||||||||||
| Liabilities: | ||||||||||||||||||||||||||
| Natural gas swaps | Other current liabilities | $ | $ | $ | ||||||||||||||||||||||
| Interest rate swaps | Other non-current liabilities | $ | $ | $ | ||||||||||||||||||||||
(a)Represents the gross amounts of recognized assets/liabilities
(b)Represents the netting of fair value balances with the same counterparty
(c)Represents the net amounts of assets/liabilities presented on the Entergy Corporation and Subsidiaries’ Consolidated Balance Sheets
(d)Excludes letters of credit posted with MISO to cover financial transmission rights exposure in the amount of $5 million as of September 30, 2026 and $2 million as of December 31, 2025
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Notes to Financial Statements
The effects of Entergy’s derivative instruments not designated as hedging instruments on the consolidated income statements for the three months ended September 30, 2026 and 2025 are as follows:
| Instrument | Income Statement Location | Amount of gain (loss) recorded in the income statement | ||||||||||||
| (In Millions) | ||||||||||||||
| 2026 | ||||||||||||||
| Natural gas swaps | Fuel, fuel-related expenses, and gas purchased for resale | (a) | ($ | |||||||||||
| Financial transmission rights | Purchased power expense | (b) | $ | |||||||||||
| Interest rate swaps | Interest expense | (c) | ($ | |||||||||||
| 2025 | ||||||||||||||
| Natural gas swaps | Fuel, fuel-related expenses, and gas purchased for resale | (a) | ($ | |||||||||||
| Financial transmission rights | Purchased power expense | (b) | $ | |||||||||||
The effects of Entergy’s derivative instruments not designated as hedging instruments on the consolidated income statements for nine months ended September 30, 2026 and 2025 are as follows:
| Instrument | Income Statement Location | Amount of gain (loss) recorded in the income statement | ||||||||||||
| (In Millions) | ||||||||||||||
| 2026 | ||||||||||||||
| Natural gas swaps | Fuel, fuel-related expenses, and gas purchased for resale | (a) | ($ | |||||||||||
| Financial transmission rights | Purchased power expense | (b) | $ | |||||||||||
| Interest rate swaps | Interest expense | (c) | ($ | |||||||||||
| 2025 | ||||||||||||||
| Natural gas swaps | Fuel, fuel-related expenses, and gas purchased for resale | (a) | ($ | |||||||||||
| Financial transmission rights | Purchased power expense | (b) | $ | |||||||||||
(a)Due to regulatory treatment, the natural gas swaps are marked-to-market through fuel, fuel-related expenses, and gas purchased for resale and such amounts are simultaneously reversed and recorded as an offsetting regulatory asset or liability. The gains or losses recorded as fuel expenses when the swaps are settled are recovered or refunded through fuel cost recovery mechanisms.
(b)Due to regulatory treatment, the changes in the estimated fair value of financial transmission rights for the Utility operating companies are recorded through purchased power expense and such amounts are simultaneously reversed and recorded as an offsetting regulatory asset or liability. The gains or losses recorded as purchased power expense when the financial transmission rights for the Utility operating companies are settled are recovered or refunded through fuel cost recovery mechanisms.
(c)Due to regulatory treatment, the changes in the estimated fair value of the interest rate swaps for Entergy Texas are recorded through interest expense and such amounts are simultaneously reversed and recorded as an offsetting regulatory asset or liability. The gains or losses recorded as interest expense when the interest rate swaps for Entergy Texas are settled are expected to be recovered in ratemaking relating to the Legend
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Notes to Financial Statements
Power Station. See Note 8 to the financial statements in the Form 10-K for discussion of the build-to-suit lease arrangement for the Legend Power Station.
The fair values of derivative instruments not designated as hedging instruments on the Registrant Subsidiaries’ balance sheets as of September 30, 2026 and December 31, 2025 are shown in the tables below. Certain investments, including those not designated as hedging instruments, are subject to master netting agreements and are presented in the balance sheet on a net basis in accordance with accounting guidance for derivatives and hedging.
| Instrument | Balance Sheet Location | Gross Fair Value (a) | Offsetting Position (b) | Net Fair Value (c) (d) | Registrant | |||||||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||||||||
| 2026 | ||||||||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||||||||
| Financial transmission rights | Prepayments and other | $ | $ | $ | Entergy Arkansas | |||||||||||||||||||||||||||
| Financial transmission rights | Prepayments and other | $ | $ | $ | Entergy Louisiana | |||||||||||||||||||||||||||
| Financial transmission rights | Prepayments and other | $ | ($ | ($ | Entergy Mississippi | |||||||||||||||||||||||||||
| Financial transmission rights | Prepayments and other | $ | $ | $ | Entergy New Orleans | |||||||||||||||||||||||||||
| Financial transmission rights | Prepayments and other | $ | ($ | $ | Entergy Texas | |||||||||||||||||||||||||||
| Interest rate swaps | Prepayments and other | $ | $ | $ | Entergy Texas | |||||||||||||||||||||||||||
| Natural gas swaps | Other deferred debits and other assets | $ | $ | $ | Entergy Louisiana | |||||||||||||||||||||||||||
| Interest rate swaps | Other deferred debits and other assets | $ | $ | $ | Entergy Texas | |||||||||||||||||||||||||||
| Liabilities: | ||||||||||||||||||||||||||||||||
| Natural gas swaps | Other current liabilities | $ | $ | $ | Entergy Louisiana | |||||||||||||||||||||||||||
| Natural gas swaps | Other current liabilities | $ | $ | $ | Entergy Mississippi | |||||||||||||||||||||||||||
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| Instrument | Balance Sheet Location | Gross Fair Value (a) | Offsetting Position (b) | Net Fair Value (c) (d) | Registrant | |||||||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||||||||
| 2025 | ||||||||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||||||||
| Financial transmission rights | Prepayments and other | $ | $ | $ | Entergy Arkansas | |||||||||||||||||||||||||||
| Financial transmission rights | Prepayments and other | $ | ($ | $ | Entergy Louisiana | |||||||||||||||||||||||||||
| Financial transmission rights | Prepayments and other | $ | $ | $ | Entergy Mississippi | |||||||||||||||||||||||||||
| Financial transmission rights | Prepayments and other | $ | $ | $ | Entergy New Orleans | |||||||||||||||||||||||||||
| Financial transmission rights | Prepayments and other | $ | ($ | $ | Entergy Texas | |||||||||||||||||||||||||||
| Interest rate swaps | Prepayments and other | $ | $ | $ | Entergy Texas | |||||||||||||||||||||||||||
| Liabilities: | ||||||||||||||||||||||||||||||||
| Natural gas swaps | Other current liabilities | $ | $ | $ | Entergy Mississippi | |||||||||||||||||||||||||||
| Interest rate swaps | Other non-current liabilities | $ | $ | $ | Entergy Texas | |||||||||||||||||||||||||||
(a)Represents the gross amounts of recognized assets/liabilities
(b)Represents the netting of fair value balances with the same counterparty
(c)Represents the net amounts of assets/liabilities presented on the Registrant Subsidiaries’ balance sheets
(d)Excludes letters of credit posted with MISO to cover financial transmission rights exposure in the amount of $3.2 million for Entergy Louisiana, $0.5 million for Entergy New Orleans, and $1 million for Entergy Texas as of September 30, 2026 and in the amount of $0.1 million for Entergy Arkansas, $0.8 million for Entergy Louisiana, $0.8 million for Entergy Mississippi, and $0.1 million for Entergy Texas as of December 31, 2025
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Notes to Financial Statements
The effects of derivative instruments not designated as hedging instruments on the Registrant Subsidiaries’ income statements for the three months ended September 30, 2026 and 2025 are as follows:
| Instrument | Income Statement Location | Amount of gain (loss) recorded in the income statement | Registrant | |||||||||||||||||
| (In Millions) | ||||||||||||||||||||
| 2026 | ||||||||||||||||||||
| Natural gas swaps | Fuel, fuel-related expenses, and gas purchased for resale | $ | (a) | Entergy Louisiana | ||||||||||||||||
| Natural gas swaps | Fuel, fuel-related expenses, and gas purchased for resale | ($ | (a) | Entergy Mississippi | ||||||||||||||||
| Financial transmission rights | Purchased power expense | $ | (b) | Entergy Arkansas | ||||||||||||||||
| Financial transmission rights | Purchased power expense | $ | (b) | Entergy Louisiana | ||||||||||||||||
| Financial transmission rights | Purchased power expense | $ | (b) | Entergy Mississippi | ||||||||||||||||
| Financial transmission rights | Purchased power expense | $ | (b) | Entergy New Orleans | ||||||||||||||||
| Financial transmission rights | Purchased power expense | $ | (b) | Entergy Texas | ||||||||||||||||
| Interest rate swaps | Interest expense | ($ | (c) | Entergy Texas | ||||||||||||||||
| 2025 | ||||||||||||||||||||
| Natural gas swaps | Fuel, fuel-related expenses, and gas purchased for resale | ($ | (a) | Entergy Mississippi | ||||||||||||||||
| Financial transmission rights | Purchased power expense | $ | (b) | Entergy Arkansas | ||||||||||||||||
| Financial transmission rights | Purchased power expense | $ | (b) | Entergy Louisiana | ||||||||||||||||
| Financial transmission rights | Purchased power expense | $ | (b) | Entergy Mississippi | ||||||||||||||||
| Financial transmission rights | Purchased power expense | $ | (b) | Entergy New Orleans | ||||||||||||||||
| Financial transmission rights | Purchased power expense | $ | (b) | Entergy Texas | ||||||||||||||||
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The effects of derivative instruments not designated as hedging instruments on the Registrant Subsidiaries’ income statements for the nine months ended September 30, 2026 and 2025 are as follows:
| Instrument | Income Statement Location | Amount of gain (loss) recorded in the income statement | Registrant | |||||||||||||||||
| (In Millions) | ||||||||||||||||||||
| 2026 | ||||||||||||||||||||
| Natural gas swaps | Fuel, fuel-related expenses, and gas purchased for resale | $ | (a) | Entergy Louisiana | ||||||||||||||||
| Natural gas swaps | Fuel, fuel-related expenses, and gas purchased for resale | ($ | (a) | Entergy Mississippi | ||||||||||||||||
| Financial transmission rights | Purchased power expense | $ | (b) | Entergy Arkansas | ||||||||||||||||
| Financial transmission rights | Purchased power expense | $ | (b) | Entergy Louisiana | ||||||||||||||||
| Financial transmission rights | Purchased power expense | $ | (b) | Entergy Mississippi | ||||||||||||||||
| Financial transmission rights | Purchased power expense | $ | (b) | Entergy New Orleans | ||||||||||||||||
| Financial transmission rights | Purchased power expense | $ | (b) | Entergy Texas | ||||||||||||||||
| Interest rate swaps | Interest expense | ($ | (c) | Entergy Texas | ||||||||||||||||
| 2025 | ||||||||||||||||||||
| Natural gas swaps | Fuel, fuel-related expenses, and gas purchased for resale | ($ | (a) | Entergy Mississippi | ||||||||||||||||
| Financial transmission rights | Purchased power expense | $ | (b) | Entergy Arkansas | ||||||||||||||||
| Financial transmission rights | Purchased power expense | $ | (b) | Entergy Louisiana | ||||||||||||||||
| Financial transmission rights | Purchased power expense | $ | (b) | Entergy Mississippi | ||||||||||||||||
| Financial transmission rights | Purchased power expense | $ | (b) | Entergy New Orleans | ||||||||||||||||
| Financial transmission rights | Purchased power expense | $ | (b) | Entergy Texas | ||||||||||||||||
(a)Due to regulatory treatment, the natural gas swaps are marked-to-market through fuel, fuel-related expenses, and gas purchased for resale and such amounts are simultaneously reversed and recorded as an offsetting regulatory asset or liability. The gains or losses recorded as fuel expenses when the swaps are settled are recovered or refunded through fuel cost recovery mechanisms.
(b)Due to regulatory treatment, the changes in the estimated fair value of financial transmission rights for the Utility operating companies are recorded through purchased power expense and such amounts are simultaneously reversed and recorded as an offsetting regulatory asset or liability. The gains or losses recorded as purchased power expense when the financial transmission rights for the Utility operating companies are settled are recovered or refunded through fuel cost recovery mechanisms.
(c)Due to regulatory treatment, the changes in the estimated fair value of the interest rate swaps for Entergy Texas are recorded through interest expense and such amounts are simultaneously reversed and recorded as an offsetting regulatory asset or liability. The gains or losses recorded as interest expense when the interest rate swaps for Entergy Texas are settled are expected to be recovered in ratemaking relating to the Legend Power Station. See Note 8 to the financial statements in the Form 10-K for discussion of the build-to-suit lease arrangement for the Legend Power Station.
Fair Values
The estimated fair values of Entergy’s financial instruments and derivatives are determined using historical prices, bid prices, market quotes, and financial modeling. Considerable judgment is required in developing the
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estimates of fair value. Therefore, estimates are not necessarily indicative of the amounts that Entergy could realize in a current market exchange. Gains or losses realized on financial instruments are reflected in future rates and therefore do not affect net income. Entergy considers the carrying amounts of most financial instruments classified as current assets and liabilities to be a reasonable estimate of their fair value because of the short maturity of these instruments.
Accounting standards define fair value as an exit price, or the price that would be received to sell an asset or the amount that would be paid to transfer a liability in an orderly transaction between knowledgeable market participants at the date of measurement. Entergy and the Registrant Subsidiaries use assumptions or market input data that market participants would use in pricing assets or liabilities at fair value. The inputs can be readily observable, corroborated by market data, or generally unobservable. Entergy and the Registrant Subsidiaries endeavor to use the best available information to determine fair value.
Accounting standards establish a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy establishes the highest priority for unadjusted market quotes in an active market for the identical asset or liability and the lowest priority for unobservable inputs.
The three levels of the fair value hierarchy are:
•Level 1 - Level 1 inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the entity has the ability to access at the measurement date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 1 primarily consists of individually owned common stocks, cash equivalents (temporary cash investments, securitization recovery trust account, and escrow accounts), debt instruments, and gas swaps traded on exchanges with active markets. Cash equivalents includes all unrestricted highly liquid debt instruments with an original or remaining maturity of three months or less at the date of purchase.
•Level 2 - Level 2 inputs are inputs other than quoted prices included in Level 1 that are, either directly or indirectly, observable for the asset or liability at the measurement date. Assets are valued based on prices derived by independent third parties that use inputs such as benchmark yields, reported trades, broker/dealer quotes, and issuer spreads. Prices are reviewed and can be challenged with the independent parties and/or overridden by Entergy if it is believed such would be more reflective of fair value. Level 2 inputs include the following:
–quoted prices for similar assets or liabilities in active markets;
–quoted prices for identical assets or liabilities in inactive markets;
–inputs other than quoted prices that are observable for the asset or liability; or
–inputs that are derived principally from or corroborated by observable market data by correlation or other means.
Level 2 consists primarily of individually-owned debt instruments, gas swaps, and interest rate swaps valued using observable inputs.
•Level 3 - Level 3 inputs are pricing inputs that are generally less observable or unobservable from objective sources. These inputs are used with internally developed methodologies to produce management’s best estimate of fair value for the asset or liability. Level 3 consists primarily of financial transmission rights.
The values of financial transmission rights are based on unobservable inputs, including estimates of congestion costs in MISO between applicable generation and load pricing nodes based on the 50th percentile of historical prices. They are classified as Level 3 assets and liabilities. The valuations of these assets and liabilities are performed by the Office of Corporate Risk Oversight. The values are calculated internally and verified against
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the data published by MISO. Entergy’s Accounting group reviews these valuations for reasonableness, with the assistance of others within the organization with knowledge of the various inputs and assumptions used in the valuation. The Office of Corporate Risk Oversight reports to the Vice President and Treasurer. The Accounting group reports to the Chief Accounting Officer.
The following tables set forth, by level within the fair value hierarchy, Entergy’s assets and liabilities that are accounted for at fair value on a recurring basis as of September 30, 2026 and December 31, 2025. The assessment of the significance of a particular input to a fair value measurement requires judgment and may affect placement within the fair value hierarchy levels.
| 2026 | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||
| Temporary cash investments | $ | $ | $ | $ | ||||||||||||||||||||||
| Decommissioning trust funds (a): | ||||||||||||||||||||||||||
| Equity securities | ||||||||||||||||||||||||||
| Debt securities | ||||||||||||||||||||||||||
| Common trusts (b) | ||||||||||||||||||||||||||
| Securitization recovery trust account | ||||||||||||||||||||||||||
| Storm reserve escrow accounts | ||||||||||||||||||||||||||
| Financial transmission rights | ||||||||||||||||||||||||||
| Natural gas swaps | ||||||||||||||||||||||||||
| Interest rate swaps | ||||||||||||||||||||||||||
| $ | $ | $ | $ | |||||||||||||||||||||||
| Liabilities: | ||||||||||||||||||||||||||
| Natural gas swaps | $ | $ | $ | $ | ||||||||||||||||||||||
| 2025 | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||
| Temporary cash investments | $ | $ | $ | $ | ||||||||||||||||||||||
| Decommissioning trust funds (a): | ||||||||||||||||||||||||||
| Equity securities | ||||||||||||||||||||||||||
| Debt securities | ||||||||||||||||||||||||||
| Common trusts (b) | ||||||||||||||||||||||||||
| Securitization recovery trust account | ||||||||||||||||||||||||||
| Storm reserve escrow accounts | ||||||||||||||||||||||||||
| Financial transmission rights | ||||||||||||||||||||||||||
| Interest rate swaps | ||||||||||||||||||||||||||
| $ | $ | $ | $ | |||||||||||||||||||||||
| Liabilities: | ||||||||||||||||||||||||||
| Natural gas swaps | $ | $ | $ | $ | ||||||||||||||||||||||
| Interest rate swaps | ||||||||||||||||||||||||||
| $ | $ | $ | $ | |||||||||||||||||||||||
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(a)The decommissioning trust funds hold equity and fixed income securities. Equity securities are invested to approximate the returns of major market indices. Fixed income securities are held in various governmental and corporate securities. See Note 9 to the financial statements herein for additional information on the investment portfolios.
(b)Common trust funds are not publicly quoted and are valued by the fund administrators using net asset value as a practical expedient. Accordingly, these funds are not assigned a level in the fair value table. The fund administrator of these investments allows daily trading at the net asset value and trades settle at a later date.
The following table sets forth a reconciliation of changes in the net assets for the fair value of financial transmission rights classified as Level 3 in the fair value hierarchy for the three months ended September 30, 2026 and 2025:
| 2026 | 2025 | ||||||||||
| (In Millions) | |||||||||||
| Balance as of July 1, | $ | $ | |||||||||
| Gains included as a regulatory liability/asset | |||||||||||
| Settlements | ( | ( | |||||||||
| Balance as of September 30, | $ | $ | |||||||||
The following table sets forth a reconciliation of changes in the net assets for the fair value of financial transmission rights classified as Level 3 in the fair value hierarchy for the nine months ended September 30, 2026 and 2025:
| 2026 | 2025 | ||||||||||||||||
| (In Millions) | |||||||||||||||||
| Balance as of January 1, | $ | $ | |||||||||||||||
| Issuances of financial transmission rights | |||||||||||||||||
Gains included as a regulatory liability/asset | |||||||||||||||||
| Settlements | ( | ( | |||||||||||||||
| Balance as of September 30, | $ | $ | |||||||||||||||
The fair values of the Level 3 financial transmission rights are based on unobservable inputs calculated internally and verified against historical pricing data published by MISO.
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The following tables set forth, by level within the fair value hierarchy, the Registrant Subsidiaries’ assets and liabilities that are accounted for at fair value on a recurring basis as of September 30, 2026 and December 31, 2025. The assessment of the significance of a particular input to a fair value measurement requires judgment and may affect placement within the fair value hierarchy levels.
Entergy Arkansas
| 2026 | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||
| Temporary cash investments | $ | $ | $ | $ | ||||||||||||||||||||||
| Decommissioning trust funds (a): | ||||||||||||||||||||||||||
| Equity securities | ||||||||||||||||||||||||||
| Debt securities | ||||||||||||||||||||||||||
| Common trusts (b) | ||||||||||||||||||||||||||
| Financial transmission rights | ||||||||||||||||||||||||||
| $ | $ | $ | $ | |||||||||||||||||||||||
| 2025 | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||
| Temporary cash investments | $ | $ | $ | $ | ||||||||||||||||||||||
| Decommissioning trust funds (a): | ||||||||||||||||||||||||||
| Equity securities | ||||||||||||||||||||||||||
| Debt securities | ||||||||||||||||||||||||||
| Common trusts (b) | ||||||||||||||||||||||||||
| Financial transmission rights | ||||||||||||||||||||||||||
| $ | $ | $ | $ | |||||||||||||||||||||||
Entergy Louisiana
| 2026 | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||
| Temporary cash investments | $ | $ | $ | $ | ||||||||||||||||||||||
| Decommissioning trust funds (a): | ||||||||||||||||||||||||||
| Equity securities | ||||||||||||||||||||||||||
| Debt securities | ||||||||||||||||||||||||||
| Common trusts (b) | ||||||||||||||||||||||||||
| Storm reserve escrow account | ||||||||||||||||||||||||||
| Financial transmission rights | ||||||||||||||||||||||||||
| Natural gas swaps | ||||||||||||||||||||||||||
| $ | $ | $ | $ | |||||||||||||||||||||||
| Liabilities: | ||||||||||||||||||||||||||
| Natural gas swaps | $ | $ | $ | $ | ||||||||||||||||||||||
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| 2025 | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||
| Temporary cash investments | $ | $ | $ | $ | ||||||||||||||||||||||
| Decommissioning trust funds (a): | ||||||||||||||||||||||||||
| Equity securities | ||||||||||||||||||||||||||
| Debt securities | ||||||||||||||||||||||||||
| Common trusts (b) | ||||||||||||||||||||||||||
| Storm reserve escrow account | ||||||||||||||||||||||||||
| Financial transmission rights | ||||||||||||||||||||||||||
| $ | $ | $ | $ | |||||||||||||||||||||||
Entergy Mississippi
| 2026 | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||
| Temporary cash investments | $ | $ | $ | $ | ||||||||||||||||||||||
| Liabilities: | ||||||||||||||||||||||||||
| Natural gas swaps | $ | $ | $ | $ | ||||||||||||||||||||||
| Financial transmission rights | ||||||||||||||||||||||||||
| $ | $ | $ | $ | |||||||||||||||||||||||
| 2025 | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||
| Temporary cash investments | $ | $ | $ | $ | ||||||||||||||||||||||
| Financial transmission rights | ||||||||||||||||||||||||||
| $ | $ | $ | $ | |||||||||||||||||||||||
| Liabilities: | ||||||||||||||||||||||||||
| Natural gas swaps | $ | $ | $ | $ | ||||||||||||||||||||||
Entergy New Orleans
| 2026 | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||
| Temporary cash investments | $ | $ | $ | $ | ||||||||||||||||||||||
| Storm reserve escrow account | ||||||||||||||||||||||||||
| Financial transmission rights | ||||||||||||||||||||||||||
| $ | $ | $ | $ | |||||||||||||||||||||||
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| 2025 | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||
| Temporary cash investments | $ | $ | $ | $ | ||||||||||||||||||||||
| Storm reserve escrow account | ||||||||||||||||||||||||||
| Financial transmission rights | ||||||||||||||||||||||||||
| $ | $ | $ | $ | |||||||||||||||||||||||
Entergy Texas
| 2026 | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||
| Temporary cash investments | $ | $ | $ | $ | ||||||||||||||||||||||
| Securitization recovery trust account | ||||||||||||||||||||||||||
| Financial transmission rights | ||||||||||||||||||||||||||
| Interest rate swaps | ||||||||||||||||||||||||||
| $ | $ | $ | $ | |||||||||||||||||||||||
| 2025 | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||
| Temporary cash investments | $ | $ | $ | $ | ||||||||||||||||||||||
| Securitization recovery trust account | ||||||||||||||||||||||||||
| Financial transmission rights | ||||||||||||||||||||||||||
| Interest rate swaps | ||||||||||||||||||||||||||
| $ | $ | $ | $ | |||||||||||||||||||||||
| Liabilities: | ||||||||||||||||||||||||||
| Interest rate swaps | $ | $ | $ | $ | ||||||||||||||||||||||
System Energy
| 2026 | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||
| Temporary cash investments | $ | $ | $ | $ | ||||||||||||||||||||||
| Decommissioning trust funds (a): | ||||||||||||||||||||||||||
| Equity securities | ||||||||||||||||||||||||||
| Debt securities | ||||||||||||||||||||||||||
| Common trusts (b) | ||||||||||||||||||||||||||
| $ | $ | $ | $ | |||||||||||||||||||||||
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| 2025 | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||
| Decommissioning trust funds (a): | ||||||||||||||||||||||||||
| Equity securities | $ | $ | $ | $ | ||||||||||||||||||||||
| Debt securities | ||||||||||||||||||||||||||
| Common trusts (b) | ||||||||||||||||||||||||||
| $ | $ | $ | $ | |||||||||||||||||||||||
(a)The decommissioning trust funds hold equity and fixed income securities. Equity securities are invested to approximate the returns of major market indices. Fixed income securities are held in various governmental and corporate securities. See Note 9 to the financial statements herein for additional information on the investment portfolios.
(b)Common trust funds are not publicly quoted and are valued by the fund administrators using net asset value as a practical expedient. Accordingly, these funds are not assigned a level in the fair value table. The fund administrator of these investments allows daily trading at the net asset value and trades settle at a later date.
The following table sets forth a reconciliation of changes in the net assets (liabilities) for the fair value of financial transmission rights classified as Level 3 in the fair value hierarchy for the three months ended September 30, 2026.
| Entergy Arkansas | Entergy Louisiana | Entergy Mississippi | Entergy New Orleans | Entergy Texas | |||||||||||||||||||||||||
| (In Millions) | |||||||||||||||||||||||||||||
| Balance as of July 1, 2026 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| Gains included as a regulatory liability/asset | |||||||||||||||||||||||||||||
| Settlements | ( | ( | ( | ( | ( | ||||||||||||||||||||||||
Balance as of September 30, 2026 | $ | $ | ($ | $ | $ | ||||||||||||||||||||||||
The following table sets forth a reconciliation of changes in the net assets for the fair value of financial transmission rights classified as Level 3 in the fair value hierarchy for the three months ended September 30, 2025.
| Entergy Arkansas | Entergy Louisiana | Entergy Mississippi | Entergy New Orleans | Entergy Texas | |||||||||||||||||||||||||
| (In Millions) | |||||||||||||||||||||||||||||
| Balance as of July 1, 2025 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| Gains included as a regulatory liability/asset | |||||||||||||||||||||||||||||
| Settlements | ( | ( | ( | ( | ( | ||||||||||||||||||||||||
Balance as of September 30, 2025 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
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The following table sets forth a reconciliation of changes in the net assets (liabilities) for the fair value of financial transmission rights classified as Level 3 in the fair value hierarchy for the nine months ended September 30, 2026.
| Entergy Arkansas | Entergy Louisiana | Entergy Mississippi | Entergy New Orleans | Entergy Texas | |||||||||||||||||||||||||
| (In Millions) | |||||||||||||||||||||||||||||
| Balance as of January 1, 2026 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| Issuances of financial transmission rights | |||||||||||||||||||||||||||||
| Gains (losses) included as a regulatory liability/asset | ( | ||||||||||||||||||||||||||||
| Settlements | ( | ( | ( | ( | ( | ||||||||||||||||||||||||
Balance as of September 30, 2026 | $ | $ | ($ | $ | $ | ||||||||||||||||||||||||
The following table sets forth a reconciliation of changes in the net assets (liabilities) for the fair value of financial transmission rights classified as Level 3 in the fair value hierarchy for the nine months ended September 30, 2025.
| Entergy Arkansas | Entergy Louisiana | Entergy Mississippi | Entergy New Orleans | Entergy Texas | |||||||||||||||||||||||||
| (In Millions) | |||||||||||||||||||||||||||||
Balance as of January 1, 2025 | $ | $ | ($ | $ | $ | ||||||||||||||||||||||||
| Issuances of financial transmission rights | |||||||||||||||||||||||||||||
| Gains included as a regulatory liability/asset | |||||||||||||||||||||||||||||
| Settlements | ( | ( | ( | ( | ( | ||||||||||||||||||||||||
Balance as of September 30, 2025 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
NOTE 9. DECOMMISSIONING TRUST FUNDS (Entergy Corporation, Entergy Arkansas, Entergy Louisiana, and System Energy)
The NRC requires certain of the Utility operating companies and System Energy to maintain nuclear decommissioning trusts to fund the costs of decommissioning ANO 1 and 2, River Bend, Waterford 3, and Grand Gulf. Entergy’s nuclear decommissioning trust funds invest in equity securities, fixed-rate debt securities, and cash and cash equivalents.
Entergy records decommissioning trust funds on the balance sheet at their fair value. Because of the ability of the Registrant Subsidiaries to recover decommissioning costs in rates and in accordance with the regulatory treatment for decommissioning trust funds, for unrealized gains/(losses) on investment securities, the Registrant Subsidiaries record an offsetting amount in other regulatory liabilities/assets. For the 30 % interest in River Bend formerly owned by Cajun, Entergy Louisiana records an offsetting amount in other long-term liabilities on the consolidated balance sheets of Entergy and Entergy Louisiana for the unrealized trust earnings not currently expected to be needed to decommission the plant. Generally, Entergy records gains and losses on its debt and equity securities using the specific identification method to determine the cost basis of its securities.
The unrealized gains/(losses) recognized during the three and nine months ended September 30, 2026 on equity securities still held as of September 30, 2026 were ($8 ) million and $339 million, respectively. The equity securities are generally held in funds that are designed to approximate or somewhat exceed the return of the Standard & Poor’s 500 Index. A relatively small percentage of the equity securities are held in funds that are
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designed to approximate or somewhat exceed the return of the Wilshire 4500 Index. The debt securities are generally held in individual government and credit issuances.
The available-for-sale debt securities held as of September 30, 2026 and December 31, 2025 are summarized as follows:
| 2026 | 2025 | |||||||||||||
| (In Millions) | ||||||||||||||
| Fair value | $ | $ | ||||||||||||
| Unrealized gains | $ | $ | ||||||||||||
| Unrealized losses | $ | $ | ||||||||||||
As of September 30, 2026 and December 31, 2025, there were no 2,577 million as of September 30, 2026 and $2,219 million as of December 31, 2025. As of September 30, 2026, available-for-sale debt securities had an average coupon rate of approximately 4.33 %, an average duration of approximately 6.13 years, and an average maturity of approximately 10.61 years.
The fair value and gross unrealized losses of available-for-sale debt securities, summarized by length of time that the securities had been in a continuous loss position, were as follows as of September 30, 2026 and December 31, 2025:
| 2026 | 2025 | |||||||||||||||||||||||||
| Fair Value | Gross Unrealized Losses | Fair Value | Gross Unrealized Losses | |||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
| Less than 12 months | $ | $ | $ | $ | ||||||||||||||||||||||
| More than 12 months | ||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||||||||||||
The fair value of available-for-sale debt securities, summarized by contractual maturities, as of September 30, 2026 and December 31, 2025 were as follows:
| 2026 | 2025 | ||||||||||
| (In Millions) | |||||||||||
| Less than 1 year | $ | $ | |||||||||
| 1 year - 5 years | |||||||||||
| 5 years - 10 years | |||||||||||
| 10 years - 15 years | |||||||||||
| 15 years - 20 years | |||||||||||
| 20 years+ | |||||||||||
| Total | $ | $ | |||||||||
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The following table summarizes proceeds from the dispositions of available-for-sale debt securities and the related gains and losses from the sales during the three and nine months ended September 30, 2026 and 2025:
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
| Proceeds from disposition of securities | $ | $ | $ | $ | ||||||||||||||||||||||
| Realized gains | $ | $ | $ | $ | ||||||||||||||||||||||
| Realized losses | $ | $ | $ | $ | ||||||||||||||||||||||
During the three and nine months ended September 30, 2026 and 2025, gross gains and gross losses related to available-for-sale debt securities were reclassified out of other regulatory liabilities/assets into earnings.
Entergy Arkansas
Entergy Arkansas holds equity securities and available-for-sale debt securities in nuclear decommissioning trust accounts. The available-for-sale debt securities held as of September 30, 2026 and December 31, 2025 are summarized as follows:
| 2026 | 2025 | |||||||||||||
| (In Millions) | ||||||||||||||
| Fair value | $ | $ | ||||||||||||
| Unrealized gains | $ | $ | ||||||||||||
| Unrealized losses | $ | $ | ||||||||||||
The amortized cost of available-for-sale debt securities was $727.5 million as of September 30, 2026 and $620.7 million as of December 31, 2025. As of September 30, 2026, the available-for-sale debt securities had an average coupon rate of approximately 3.90 %, an average duration of approximately 6.00 years, and an average maturity of approximately 8.30 years.
The unrealized gains/(losses) recognized during the three and nine months ended September 30, 2026 on equity securities still held as of September 30, 2026 were ($7.0 ) million and $94.3 million, respectively. The equity securities are generally held in funds that are designed to approximate or somewhat exceed the return of the Standard & Poor’s 500 Index. A relatively small percentage of the equity securities are held in funds that are designed to approximate or somewhat exceed the return of the Wilshire 4500 Index. The debt securities are generally held in individual government and credit issuances.
The fair value and gross unrealized losses of available-for-sale debt securities, summarized by length of time that the securities had been in a continuous loss position, were as follows as of September 30, 2026 and December 31, 2025:
| 2026 | 2025 | |||||||||||||||||||||||||
| Fair Value | Gross Unrealized Losses | Fair Value | Gross Unrealized Losses | |||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
| Less than 12 months | $ | $ | $ | $ | ||||||||||||||||||||||
| More than 12 months | ||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||||||||||||
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Notes to Financial Statements
The fair value of available-for-sale debt securities, summarized by contractual maturities, as of September 30, 2026 and December 31, 2025 were as follows:
| 2026 | 2025 | ||||||||||
| (In Millions) | |||||||||||
| Less than 1 year | $ | $ | |||||||||
| 1 year - 5 years | |||||||||||
| 5 years - 10 years | |||||||||||
| 10 years - 15 years | |||||||||||
| 15 years - 20 years | |||||||||||
| 20 years+ | |||||||||||
| Total | $ | $ | |||||||||
The following table summarizes proceeds from the dispositions of available-for-sale debt securities and the related gains and losses from the sales during the three and nine months ended September 30, 2026 and 2025:
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
| Proceeds from disposition of securities | $ | $ | $ | $ | ||||||||||||||||||||||
| Realized gains | $ | $ | $ | $ | ||||||||||||||||||||||
| Realized losses | $ | $ | $ | $ | ||||||||||||||||||||||
During the three and nine months ended September 30, 2026 and 2025, gross gains and gross losses related to available-for-sale debt securities were reclassified out of other regulatory liabilities/assets into earnings.
Entergy Louisiana
Entergy Louisiana holds equity securities and available-for-sale debt securities in nuclear decommissioning trust accounts. The available-for-sale debt securities held as of September 30, 2026 and December 31, 2025 are summarized as follows:
| 2026 | 2025 | |||||||||||||
| (In Millions) | ||||||||||||||
| Fair value | $ | $ | ||||||||||||
| Unrealized gains | $ | $ | ||||||||||||
| Unrealized losses | $ | $ | ||||||||||||
The amortized cost of available-for-sale debt securities was $1,147.4 million as of September 30, 2026 and $994.6 million as of December 31, 2025. As of September 30, 2026, the available-for-sale debt securities had an average coupon rate of approximately 4.53 %, an average duration of approximately 6.37 years, and an average maturity of approximately 11.70 years.
The unrealized gains/(losses) recognized during the three and nine months ended September 30, 2026 on equity securities still held as of September 30, 2026 were $4.2 million and $151.9 million, respectively. The equity securities are generally held in funds that are designed to approximate or somewhat exceed the return of the Standard & Poor’s 500 Index. A relatively small percentage of the equity securities are held in funds that are designed to approximate or somewhat exceed the return of the Wilshire 4500 Index. The debt securities are generally held in individual government and credit issuances.
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The fair value and gross unrealized losses of available-for-sale debt securities, summarized by length of time that the securities had been in a continuous loss position, were as follows as of September 30, 2026 and December 31, 2025:
| 2026 | 2025 | |||||||||||||||||||||||||
| Fair Value | Gross Unrealized Losses | Fair Value | Gross Unrealized Losses | |||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
| Less than 12 months | $ | $ | $ | $ | ||||||||||||||||||||||
| More than 12 months | ||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||||||||||||
The fair value of available-for-sale debt securities, summarized by contractual maturities, as of September 30, 2026 and December 31, 2025 were as follows:
| 2026 | 2025 | ||||||||||
| (In Millions) | |||||||||||
| Less than 1 year | $ | $ | |||||||||
| 1 year - 5 years | |||||||||||
| 5 years - 10 years | |||||||||||
| 10 years - 15 years | |||||||||||
| 15 years - 20 years | |||||||||||
| 20 years+ | |||||||||||
| Total | $ | $ | |||||||||
The following table summarizes proceeds from the dispositions of available-for-sale debt securities and the related gains and losses from the sales during the three and nine months ended September 30, 2026 and 2025:
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
| Proceeds from disposition of securities | $ | $ | $ | $ | ||||||||||||||||||||||
| Realized gains | $ | $ | $ | $ | ||||||||||||||||||||||
| Realized losses | $ | $ | $ | $ | ||||||||||||||||||||||
During the three and nine months ended September 30, 2026 and 2025, gross gains and gross losses related to available-for-sale debt securities were reclassified out of other regulatory liabilities/assets into earnings.
System Energy
System Energy holds equity securities and available-for-sale debt securities in nuclear decommissioning trust accounts. The available-for-sale debt securities held as of September 30, 2026 and December 31, 2025 are summarized as follows:
| 2026 | 2025 | |||||||||||||
| (In Millions) | ||||||||||||||
| Fair value | $ | $ | ||||||||||||
| Unrealized gains | $ | $ | ||||||||||||
| Unrealized losses | $ | $ | ||||||||||||
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The amortized cost of available-for-sale debt securities was $701.7 million as of September 30, 2026 and $603.7 million as of December 31, 2025. As of September 30, 2026, the available-for-sale debt securities had an average coupon rate of approximately 4.44 %, an average duration of approximately 5.85 years, and an average maturity of approximately 11.24 years.
The unrealized gains/(losses) recognized during the three and nine months ended September 30, 2026 on equity securities still held as of September 30, 2026 were ($4.8 ) million and $93.1 million, respectively. The equity securities are generally held in funds that are designed to approximate or somewhat exceed the return of the Standard & Poor’s 500 Index. A relatively small percentage of the equity securities are held in funds that are designed to approximate or somewhat exceed the return of the Wilshire 4500 Index. The debt securities are generally held in individual government and credit issuances.
The fair value and gross unrealized losses of available-for-sale debt securities, summarized by length of time that the securities had been in a continuous loss position, were as follows as of September 30, 2026 and December 31, 2025:
| 2026 | 2025 | |||||||||||||||||||||||||
| Fair Value | Gross Unrealized Losses | Fair Value | Gross Unrealized Losses | |||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
| Less than 12 months | $ | $ | $ | $ | ||||||||||||||||||||||
| More than 12 months | ||||||||||||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||||||||||||
The fair value of available-for-sale debt securities, summarized by contractual maturities, as of September 30, 2026 and December 31, 2025 were as follows:
| 2026 | 2025 | ||||||||||
| (In Millions) | |||||||||||
| Less than 1 year | $ | $ | |||||||||
| 1 year - 5 years | |||||||||||
| 5 years - 10 years | |||||||||||
| 10 years - 15 years | |||||||||||
| 15 years - 20 years | |||||||||||
| 20 years+ | |||||||||||
| Total | $ | $ | |||||||||
The following table summarizes proceeds from the dispositions of available-for-sale debt securities and the related gains and losses from the sales during the three and nine months ended September 30, 2026 and 2025:
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||
| (In Millions) | ||||||||||||||||||||||||||
| Proceeds from disposition of securities | $ | $ | $ | $ | ||||||||||||||||||||||
| Realized gains | $ | $ | $ | $ | ||||||||||||||||||||||
| Realized losses | $ | $ | $ | $ | ||||||||||||||||||||||
During the three and nine months ended September 30, 2026 and 2025, gross gains and gross losses related to available-for-sale debt securities were reclassified out of other regulatory liabilities/assets into earnings.
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Notes to Financial Statements
NOTE 10. INCOME TAXES (Entergy Corporation, Entergy Arkansas, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy)
See “Income Tax Audits” and “Other Tax Matters” in Note 3 to the financial statements in the Form 10-K for a discussion of income tax audits, the Tax Cuts and Jobs Act, the Inflation Reduction Act of 2022, and other income tax matters involving Entergy. The following are updates to that discussion.
Income Tax Audits
2019-2021 IRS Audit
Entergy and the Registrant Subsidiaries anticipate the resolution of the IRS audit of the 2019 through 2021 tax years and expect to record the effects of the adjustments associated with such audit by the end of 2026 or in early 2027. As discussed in Note 3 to the financial statements in the Form 10-K, the resolution of audit issues could result in significant changes to the amounts of unrecognized tax benefits. Entergy may file amended income tax returns for post-2021 tax years, as considered necessary, depending on the outcome of the 2019-2021 IRS audit.
Other Tax Matters
Inflation Reduction Act of 2022
In April 2026 the LPSC issued an order approving an agreement between Entergy Louisiana and the LPSC staff regarding the monetization of the 2025 nuclear production tax credits. The order allows Entergy Louisiana to retain the net proceeds of the monetized credits while the associated tax position remains uncertain. While retaining these proceeds, Entergy Louisiana will accrue carrying charges to its customers at its weighted average cost of capital. The order further provides that customers will be responsible for any associated costs should the IRS reduce some or all of the value of the nuclear production tax credits transferred to third parties. Once the IRS makes a final determination affirming the value of the credits or the audit period expires without a disallowance, Entergy Louisiana will commence flowing the net proceeds of the nuclear production tax credits, including carrying charges, to its customers. This treatment is consistent with the approach previously approved for the 2024 nuclear production tax credits, as discussed in Note 3 to the financial statements in the Form 10-K.
In June 2026, as part of Entergy Mississippi’s 2026 formula rate plan filing, the MPSC issued an order approving the joint stipulation between the Mississippi Public Utilities Staff and Entergy Mississippi that included, among other items, the mechanism for treatment of the monetization of past and future nuclear production tax credits. The order allows Entergy Mississippi to retain the net proceeds of the monetized credits while the associated tax position remains uncertain. While retaining these proceeds, Entergy Mississippi will accrue carrying charges at its average cost of debt, as determined by Entergy Mississippi’s debt rate in its current formula rate plan. The order further provides that Entergy Mississippi will be responsible for any associated costs should the IRS reduce some or all of the value of the nuclear production tax credits transferred to third parties. Once the IRS makes a final determination affirming the value of the credits or the audit period expires without a disallowance, Entergy Mississippi will commence flowing the net proceeds of the nuclear production tax credits, including carrying charges, to its customers in accordance with the return period to be determined by the MPSC. Carrying charges at Entergy Mississippi’s average cost of debt will only apply to the value of the credits that are allowed by the IRS. See Note 2 to the financial statements herein for discussion of Entergy Mississippi’s 2026 formula rate plan filing.
In second quarter 2026, Entergy Arkansas, Entergy Louisiana, and System Energy entered into agreements with third-party purchasers to transfer in the third and fourth quarters of 2026 certain nuclear and solar production tax credits for cash, including a reasonable discount, prior to the filing of Entergy’s 2025 federal income tax return.
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In September 2026, Entergy Arkansas, Entergy Louisiana, and System Energy transferred the 2025 nuclear production tax credits to third parties and received cash of $99.2 million, $55.8 million, and $68.8 million, respectively, resulting in total Entergy cash receipts of $223.8 million. The proceeds from the transfers reflected a market-based discount. In accordance with the Unit Power Sales Agreement and the MSS-4 replacement tariff, portions of the net proceeds from the transfers of the nuclear production tax credits were paid by Entergy Arkansas, Entergy Louisiana, and System Energy to the buyers of energy and capacity under those wholesale agreements in October 2026. In addition, Entergy Arkansas transferred its 2025 solar production tax credits to a third party and received cash of approximately $32.1 million in October 2026. The monetized value of these solar production tax credits, net of applicable expenses, is expected to be addressed in retail rates in accordance with applicable regulatory mechanisms.
Arkansas Corporate Income Tax Rate Change
In May 2026 the State of Arkansas enacted a corporate income tax rate reduction from 4.3 % to 4.1 %, effective January 1, 2027. As a result of the rate reduction, Entergy Arkansas recorded a regulatory liability for income taxes of approximately $16 million. The regulatory liability includes both the excess deferred income taxes and the associated tax gross-up required under the retail and wholesale ratemaking formulas.
Amortization of Tax Gross-up on Customer Advances
Amortization of tax gross-up on customer advances, including customer advances for construction, was $43.5 million for Entergy, $7.0 million for Entergy Arkansas, $25.9 million for Entergy Louisiana, $9.1 million for Entergy Mississippi, and $1.5 million for Entergy Texas for the three months ended September 30, 2026 and $20.8 million for Entergy, $2.1 million for Entergy Arkansas, $14.8 million for Entergy Louisiana, $2.6 million for Entergy Mississippi, and $1.3 million for Entergy Texas for the three months ended September 30, 2025. Amortization of tax gross-up on customer advances, including customer advances for construction, was $106.7 million for Entergy, $11.2 million for Entergy Arkansas, $68.4 million for Entergy Louisiana, $24.9 million for Entergy Mississippi, and $2.2 million for Entergy Texas for the nine months ended September 30, 2026 and $45.4 million for Entergy, $3.4 million for Entergy Arkansas, $28.2 million for Entergy Louisiana, $10.2 million for Entergy Mississippi, and $3.6 million for Entergy Texas for the nine months ended September 30, 2025. Amortization of tax gross-up on customer advances is included in miscellaneous – net in other income on the income statement.
NOTE 11. VARIABLE INTEREST ENTITIES (Entergy Corporation, Entergy Arkansas, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy)
See Note 17 to the financial statements in the Form 10-K for a discussion of VIEs. See Note 4 to the financial statements herein for details of the nuclear fuel companies’ credit facilities, commercial paper borrowings, and long-term debt. See Note 6 to the financial statements in the Form 10-K for discussion of noncontrolling interests.
Restoration Law Trust I (the storm trust I), a trust consolidated by Entergy Louisiana, is a VIE and Entergy Louisiana is the primary beneficiary. As of September 30, 2026 and December 31, 2025, the primary asset held by the storm trust I was $2.5 billion and $2.7 billion, respectively, of outstanding Entergy Finance Company preferred membership interests, which is reflected as an investment in affiliate preferred membership interests on the consolidated balance sheets of Entergy Louisiana. The LURC’s 1 % beneficial interest in the storm trust I is recorded as noncontrolling interest on the consolidated balance sheets of Entergy and Entergy Louisiana, with balances of $26.6 million as of September 30, 2026 and $27.1 million as of December 31, 2025.
Restoration Law Trust II (the storm trust II), a trust consolidated by Entergy Louisiana, is a VIE and Entergy Louisiana is the primary beneficiary. As of September 30, 2026 and December 31, 2025, the primary asset
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held by the storm trust II was $1.3 billion and $1.3 billion, respectively, of outstanding Entergy Finance Company preferred membership interests, which is reflected as an investment in affiliate preferred membership interests on the consolidated balance sheets of Entergy Louisiana. The LURC’s 1 % beneficial interest in the storm trust II is recorded as noncontrolling interest on the consolidated balance sheets of Entergy and Entergy Louisiana, with balances of $13.5 million as of September 30, 2026 and $13.1 million as of December 31, 2025.
System Energy is considered to hold a variable interest in the lessor from which it leases an undivided interest in the Grand Gulf nuclear plant. System Energy is the lessee under this arrangement, which is described in more detail in Note 5 to the financial statements in the Form 10-K. System Energy made payments under this arrangement, including interest, of $17.2
AR Searcy Partnership, LLC is a tax equity partnership that qualifies as a VIE, which Entergy Arkansas is required to consolidate as it is the primary beneficiary. As of September 30, 2026, AR Searcy Partnership, LLC recorded assets equal to $121.1 million, primarily consisting of property, plant, and equipment, and the carrying value of Entergy Arkansas’s ownership interest in the partnership was approximately $110.3 million. As of December 31, 2025, AR Searcy Partnership, LLC recorded assets equal to $124.4 million, primarily consisting of property, plant, and equipment, and the carrying value of Entergy Arkansas’s ownership interest in the partnership was approximately $113.1 million. The tax equity investor’s ownership interest is recorded as noncontrolling interest on the consolidated balance sheets of Entergy and Entergy Arkansas.
MS Sunflower Partnership, LLC is a tax equity partnership that qualifies as a VIE, which Entergy Mississippi is required to consolidate as it is the primary beneficiary. As of September 30, 2026, MS Sunflower Partnership, LLC recorded assets equal to $149.3 million, primarily consisting of property, plant, and equipment, and the carrying value of Entergy Mississippi’s ownership interest in the partnership was approximately $132.5 million. As of December 31, 2025, MS Sunflower Partnership, LLC recorded assets equal to $154.5 million, primarily consisting of property, plant, and equipment, and the carrying value of Entergy Mississippi’s ownership interest in the partnership was approximately $134.9 million. The tax equity investor’s ownership interest is recorded as noncontrolling interest on the consolidated balance sheets of Entergy and Entergy Mississippi.
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Notes to Financial Statements
NOTE 12. REVENUE (Entergy Corporation, Entergy Arkansas, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy)
Operating Revenues
See Note 19 to the financial statements in the Form 10-K for a discussion of revenue recognition. Entergy’s total revenues for the three months ended September 30, 2026 and 2025 were as follows:
| 2026 | 2025 | ||||||||||||||||||||||
| (In Thousands) | |||||||||||||||||||||||
| Utility: | |||||||||||||||||||||||
| Residential | $ | $ | |||||||||||||||||||||
| Commercial | |||||||||||||||||||||||
| Industrial | |||||||||||||||||||||||
| Governmental | |||||||||||||||||||||||
| Total billed retail | |||||||||||||||||||||||
| Sales for resale (a) | |||||||||||||||||||||||
| Other electric revenues (b) | |||||||||||||||||||||||
| Revenues from contracts with customers | |||||||||||||||||||||||
| Other Utility revenues (c) | |||||||||||||||||||||||
| Electric revenues | |||||||||||||||||||||||
| Natural gas revenues | |||||||||||||||||||||||
| Other revenues (d) | |||||||||||||||||||||||
| Total operating revenues | $ | $ | |||||||||||||||||||||
Entergy’s total revenues for the nine months ended September 30, 2026 and 2025 were as follows:
| 2026 | 2025 | ||||||||||||||||||||||
| (In Thousands) | |||||||||||||||||||||||
| Utility: | |||||||||||||||||||||||
| Residential | $ | $ | |||||||||||||||||||||
| Commercial | |||||||||||||||||||||||
| Industrial | |||||||||||||||||||||||
| Governmental | |||||||||||||||||||||||
| Total billed retail | |||||||||||||||||||||||
| Sales for resale (a) | |||||||||||||||||||||||
| Other electric revenues (b) | |||||||||||||||||||||||
| Revenues from contracts with customers | |||||||||||||||||||||||
| Other Utility revenues (c) | |||||||||||||||||||||||
| Electric revenues | |||||||||||||||||||||||
| Natural gas revenues | |||||||||||||||||||||||
| Other revenues (d) | |||||||||||||||||||||||
| Total operating revenues | $ | $ | |||||||||||||||||||||
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The Utility operating companies’ total revenues for the three months ended September 30, 2026 and 2025 were as follows:
| 2026 | Entergy Arkansas | Entergy Louisiana | Entergy Mississippi | Entergy New Orleans | Entergy Texas | |||||||||||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||||||||||||||
| Residential | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
| Commercial | ||||||||||||||||||||||||||||||||
| Industrial | ||||||||||||||||||||||||||||||||
| Governmental | ||||||||||||||||||||||||||||||||
| Total billed retail | ||||||||||||||||||||||||||||||||
| Sales for resale (a) | ||||||||||||||||||||||||||||||||
| Other electric revenues (b) | ||||||||||||||||||||||||||||||||
| Revenues from contracts with customers | ||||||||||||||||||||||||||||||||
| Other revenues (c) | ( | |||||||||||||||||||||||||||||||
| Electric revenues | ||||||||||||||||||||||||||||||||
| Natural gas revenues | ||||||||||||||||||||||||||||||||
| Total operating revenues | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
| 2025 | Entergy Arkansas | Entergy Louisiana | Entergy Mississippi | Entergy New Orleans | Entergy Texas | |||||||||||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||||||||||||||
| Residential | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
| Commercial | ||||||||||||||||||||||||||||||||
| Industrial | ||||||||||||||||||||||||||||||||
| Governmental | ||||||||||||||||||||||||||||||||
| Total billed retail | ||||||||||||||||||||||||||||||||
| Sales for resale (a) | ||||||||||||||||||||||||||||||||
| Other electric revenues (b) | ( | |||||||||||||||||||||||||||||||
| Revenues from contracts with customers | ||||||||||||||||||||||||||||||||
| Other revenues (c) | ( | |||||||||||||||||||||||||||||||
| Electric revenues | ||||||||||||||||||||||||||||||||
| Natural gas revenues | ||||||||||||||||||||||||||||||||
| Total operating revenues | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
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Notes to Financial Statements
The Utility operating companies’ total revenues for the nine months ended September 30, 2026 and 2025 were as follows:
| 2026 | Entergy Arkansas | Entergy Louisiana | Entergy Mississippi | Entergy New Orleans | Entergy Texas | |||||||||||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||||||||||||||
| Residential | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
| Commercial | ||||||||||||||||||||||||||||||||
| Industrial | ||||||||||||||||||||||||||||||||
| Governmental | ||||||||||||||||||||||||||||||||
| Total billed retail | ||||||||||||||||||||||||||||||||
| Sales for resale (a) | ||||||||||||||||||||||||||||||||
| Other electric revenues (b) | ||||||||||||||||||||||||||||||||
| Revenues from contracts with customers | ||||||||||||||||||||||||||||||||
| Other revenues (c) | ( | |||||||||||||||||||||||||||||||
| Electric revenues | ||||||||||||||||||||||||||||||||
| Natural gas revenues | ||||||||||||||||||||||||||||||||
| Total operating revenues | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
| 2025 | Entergy Arkansas | Entergy Louisiana | Entergy Mississippi | Entergy New Orleans | Entergy Texas | |||||||||||||||||||||||||||
| (In Thousands) | ||||||||||||||||||||||||||||||||
| Residential | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
| Commercial | ||||||||||||||||||||||||||||||||
| Industrial | ||||||||||||||||||||||||||||||||
| Governmental | ||||||||||||||||||||||||||||||||
| Total billed retail | ||||||||||||||||||||||||||||||||
| Sales for resale (a) | ||||||||||||||||||||||||||||||||
| Other electric revenues (b) | ||||||||||||||||||||||||||||||||
| Revenues from contracts with customers | ||||||||||||||||||||||||||||||||
| Other revenues (c) | ( | |||||||||||||||||||||||||||||||
| Electric revenues | ||||||||||||||||||||||||||||||||
| Natural gas revenues | ||||||||||||||||||||||||||||||||
| Total operating revenues | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
(a)Sales for resale includes day-ahead sales of energy in a market administered by an ISO. These sales represent financially binding commitments for the sale of physical energy the next day. These sales are adjusted to actual power generated and delivered in the real time market. Given the short duration of these transactions, Entergy does not consider them to be derivatives subject to fair value adjustments and includes them as part of customer revenues.
(b)Other electric revenues consist primarily of the return on construction work in progress for certain utility plant investments, transmission and ancillary services provided to participants of an ISO-administered market, and unbilled revenue.
(c)Other Utility revenues include occasional sales of inventory, alternative revenue programs, provisions for revenue subject to refund, late fees, and amounts resulting from other operating activities.
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(d)Other revenues include the sale of electric power and capacity to wholesale customers, day-ahead sales of energy in a market administered by an ISO, and operation and management services fees.
Electric Revenues
See Note 19 to the financial statements in the Form 10-K for a discussion of electric revenues. The following is an update to that discussion.
Most of Entergy’s contracts are on demand, with customer bills that vary each month based on an approved tariff and usage. Certain retail customers, primarily large industrial customers from various industries, have electric service agreements that include a fixed amount of consideration to be paid through the end of a contract term longer than one year. As of September 30, 2026, the amount of revenues related to this fixed consideration that Entergy expects to recognize over the remaining contract terms, extending through 2048, was $9,680 million for Entergy, including $4,702 million for Entergy Arkansas, $1,977 million for Entergy Louisiana, $2,553 million for Entergy Mississippi, and $448 million for Entergy Texas. These contracts also require variable payments based on the actual amount of energy service, which are recognized as revenue as Entergy has the right to bill the customer for services performed.
________________
In the opinion of the management of Entergy Corporation, Entergy Arkansas, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy, the accompanying unaudited financial statements contain all adjustments (consisting primarily of normal recurring accruals and reclassification of previously reported amounts to conform to current classifications) necessary for a fair statement of the results for the interim periods presented. Entergy’s business is subject to seasonal fluctuations, however, with peak periods occurring typically during the first and third quarters. The results for the interim periods presented should not be used as a basis for estimating results of operations for a full year.
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Part I, Item 3. Quantitative and Qualitative Disclosures About Market Risk
See the “Market and Credit Risk Sensitive Instruments” section of Entergy Corporation and Subsidiaries Management’s Financial Discussion and Analysis.
Part I, Item 4. Controls and Procedures
Disclosure Controls and Procedures
As of September 30, 2026 evaluations were performed under the supervision and with the participation of Entergy Corporation, Entergy Arkansas, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy (each individually a “Registrant” and collectively the “Registrants”) management, including their respective Principal Executive Officers (PEO) and Principal Financial Officers (PFO). The evaluations assessed the effectiveness of the Registrants’ disclosure controls and procedures. Based on the evaluations, each PEO and PFO has concluded that, as to the Registrant or Registrants for which they serve as PEO or PFO, the Registrant’s or Registrants’ disclosure controls and procedures are effective to ensure that information required to be disclosed by each Registrant in reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized, and reported within the time periods specified in Securities and Exchange Commission rules and forms; and that the Registrant’s or Registrants’ disclosure controls and procedures are also effective in reasonably assuring that such information is accumulated and communicated to the Registrant’s or Registrants’ management, including their respective PEOs and PFOs, as appropriate to allow timely decisions regarding required disclosure.
Changes in Internal Control over Financial Reporting
Under the supervision and with the participation of each Registrant’s management, including its respective PEO and PFO, each Registrant evaluated changes in internal control over financial reporting that occurred during the quarter ended September 30, 2026 and found no change that has materially affected, or is reasonably likely to materially affect, internal control over financial reporting.
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MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS
Winter Storm Fern
See the “Winter Storm Fern” section of Entergy Corporation and Subsidiaries Management’s Financial Discussion and Analysis for a discussion of Winter Storm Fern. Entergy Arkansas’s cost of mobilizing crews and restoring power was approximately $50 million, including approximately $40 million in capital costs and approximately $10 million in non-capital costs. Natural gas purchases for Entergy Arkansas were $74 million in January 2026 compared to $25 million in January 2025.
Results of Operations
Net Income
Third Quarter 2026 Compared to Third Quarter 2025
Net income increased $71.4 million primarily due to higher retail electric price and higher volume/weather, partially offset by higher other operation and maintenance expenses and higher interest expense.
Nine Months Ended September 30, 2026 Compared to Nine Months Ended September 30, 2025
Net income increased $53.8 million primarily due to higher retail electric price, higher volume/weather, and higher other income, partially offset by higher interest expense, higher other operation and maintenance expenses, and higher depreciation and amortization expenses.
Operating Revenues
Third Quarter 2026 Compared to Third Quarter 2025
Following is an analysis of the change in operating revenues comparing the third quarter 2026 to the third quarter 2025:
| Amount | |||||
| (In Millions) | |||||
| 2025 operating revenues | $864.1 | ||||
| Fuel, rider, and other revenues that do not significantly affect net income | (0.9) | ||||
| Retail electric price | 68.2 | ||||
| Volume/weather | 56.2 | ||||
| 2026 operating revenues | $987.6 | ||||
Entergy Arkansas’s results include revenues from rate mechanisms designed to recover fuel, purchased power, and other costs such that the revenues and expenses associated with these items generally offset and do not affect net income. “Fuel, rider, and other revenues that do not significantly affect net income” includes the revenue variance associated with these items.
The retail electric price variance is primarily due to an increase in formula rate plan rates effective January 2026 and the implementation of the Generating Arkansas Jobs Act rider effective June 2026. See Note 2 to the
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financial statements in the Form 10-K for discussion of the 2025 formula rate plan filing. See Note 2 to the financial statements herein for discussion of the Generating Arkansas Jobs Act rider filing.
The volume/weather variance is primarily due to the effect of more favorable weather on residential and commercial sales and an increase in weather-adjusted residential usage.
Total electric energy sales for Entergy Arkansas for the three months ended September 30, 2026 and 2025 are as follows:
| 2026 | 2025 | % Change | |||||||||||||||
| (GWh) | |||||||||||||||||
| Residential | 2,734 | 2,357 | 16 | ||||||||||||||
| Commercial | 1,851 | 1,724 | 7 | ||||||||||||||
| Industrial | 3,443 | 3,380 | 2 | ||||||||||||||
| Governmental | 49 | 59 | (17) | ||||||||||||||
| Total retail | 8,077 | 7,520 | 7 | ||||||||||||||
| Sales for resale: | |||||||||||||||||
| Associated companies | 273 | 592 | (54) | ||||||||||||||
| Non-associated companies | 660 | 1,336 | (51) | ||||||||||||||
| Total | 9,010 | 9,448 | (5) | ||||||||||||||
See Note 12 to the financial statements herein for additional discussion of Entergy Arkansas’s operating revenues.
Nine Months Ended September 30, 2026 Compared to Nine Months Ended September 30, 2025
Following is an analysis of the change in operating revenues comparing the nine months ended September 30, 2026 to the nine months ended September 30, 2025:
| Amount | |||||
| (In Millions) | |||||
| 2025 operating revenues | $2,175.3 | ||||
| Fuel, rider, and other revenues that do not significantly affect net income | (16.3) | ||||
| Retail electric price | 122.9 | ||||
| Volume/weather | 45.4 | ||||
| 2026 operating revenues | $2,327.3 | ||||
Entergy Arkansas’s results include revenues from rate mechanisms designed to recover fuel, purchased power, and other costs such that the revenues and expenses associated with these items generally offset and do not affect net income. “Fuel, rider, and other revenues that do not significantly affect net income” includes the revenue variance associated with these items.
The retail electric price variance is primarily due to an increase in formula rate plan rates effective January 2026 and the implementation of the Generating Arkansas Jobs Act rider effective June 2026. See Note 2 to the financial statements in the Form 10-K for discussion of the 2025 formula rate plan filing. See Note 2 to the financial statements herein for discussion of the Generating Arkansas Jobs Act rider filing.
The volume/weather variance is primarily due to the effect of more favorable weather on residential and commercial sales and an increase in industrial usage, partially offset by a decrease in weather-adjusted commercial
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usage. The increase in industrial usage is primarily due to an increase in demand from large industrial customers, primarily primary metals customers.
Total electric energy sales for Entergy Arkansas for the nine months ended September 30, 2026 and 2025 are as follows:
| 2026 | 2025 | % Change | |||||||||||||||
| (GWh) | |||||||||||||||||
| Residential | 6,371 | 6,242 | 2 | ||||||||||||||
| Commercial | 4,486 | 4,377 | 2 | ||||||||||||||
| Industrial | 9,819 | 8,986 | 9 | ||||||||||||||
| Governmental | 133 | 147 | (10) | ||||||||||||||
| Total retail | 20,809 | 19,752 | 5 | ||||||||||||||
| Sales for resale: | |||||||||||||||||
| Associated companies | 697 | 1,688 | (59) | ||||||||||||||
| Non-associated companies | 2,144 | 3,792 | (43) | ||||||||||||||
| Total | 23,650 | 25,232 | (6) | ||||||||||||||
See Note 12 to the financial statements herein for additional discussion of Entergy Arkansas’s operating revenues.
Other Income Statement Variances
Third Quarter 2026 Compared to Third Quarter 2025
Other operation and maintenance expenses increased primarily due to:
•an increase of $5.1 million in power delivery expenses primarily due to higher vegetation maintenance costs;
•an increase of $3.7 million in non-nuclear generation expenses primarily due to a higher scope of work in 2026 as compared to 2025;
•an increase of $2.2 million in compensation and benefits costs primarily due to higher healthcare claims activity; and
•several individually insignificant items.
Taxes other than income taxes decreased primarily due to an increase in ad valorem tax accruals for the 2025 tax year as a result of updated tax rates received in third quarter 2025.
Depreciation and amortization expenses increased primarily due to additions to plant in service and an increase in FERC jurisdictional depreciation rates effective January 2026.
Entergy Arkansas records a regulatory charge or credit for the difference between asset retirement obligation-related expenses and nuclear decommissioning trust earnings plus asset retirement obligation-related costs collected in revenue.
Other income increased primarily due to an increase of $4.9 million in the amortization of tax gross-up on customer advances, including customer advances for construction.
Interest expense increased primarily due to the issuances of $500 million of 5.75% Series mortgage bonds and $500 million of 4.95% Series mortgage bonds, each in January 2026, and $4.2 million in carrying costs in third
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quarter 2026 on retained net proceeds from the monetization of nuclear production tax credits. The increase was partially offset by the repayment of $600 million of 3.5% Series mortgage bonds in February 2026.
Nine Months Ended September 30, 2026 Compared to Nine Months Ended September 30, 2025
Other operation and maintenance expenses increased primarily due to:
•an increase of $22.5 million in power delivery expenses primarily due to higher vegetation maintenance costs;
•an increase of $8.9 million in compensation and benefits costs primarily due to higher healthcare claims activity, the timing of the recognition of prescription drug rebates, and a larger revision to estimated incentive-based compensation expense in 2025;
•an increase of $4.5 million in non-nuclear generation expenses primarily due to a higher scope of work performed in 2026 as compared to 2025; and
•several individually insignificant items.
The increase was partially offset by:
•a decrease of $10.5 million in energy efficiency expenses primarily due to the timing of recovery from customers;
•a decrease of $5.4 million in insurance expense primarily due to higher nuclear insurance refunds; and
•a decrease of $5.1 million in loss provisions.
Depreciation and amortization expenses increased primarily due to additions to plant in service and an increase in FERC jurisdictional depreciation rates effective January 2026.
Other regulatory charges (credits) - net includes a regulatory charge of $8.8 million, recorded in second quarter 2026, to reflect the amount of the 2025 historical year netting adjustment to be returned to Entergy Arkansas’s customers during the 2027 rate effective period as included in the 2026 formula rate plan filing. See Note 2 to the financial statements herein for discussion of the 2026 formula rate plan filing. In addition, Entergy Arkansas records a regulatory charge or credit for the difference between asset retirement obligation-related expenses and nuclear decommissioning trust earnings plus asset retirement obligation-related costs collected in revenue.
Other income increased primarily due to:
•changes in decommissioning trust fund activity, including portfolio rebalancing of decommissioning trust funds in first quarter 2026;
•an increase of $8.3 million in interest earned on money pool investments; and
•an increase of $7.8 million in the amortization of tax gross-up on customer advances, including customer advances for construction.
Interest expense increased primarily due to:
•the issuances of $500 million of 5.75% Series mortgage bonds and $500 million of 4.95% Series mortgage bonds, each in January 2026;
•the issuance of $300 million of 5.45% Series mortgage bonds in May 2025; and
•$12.2 million in carrying costs in 2026 on retained net proceeds from the monetization of nuclear production tax credits.
The increase was partially offset by the repayment of $600 million of 3.5% Series mortgage bonds in February 2026.
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Income Taxes
The effective income tax rate was 22.3% for the third quarter 2026. The difference in the effective income tax rate for the third quarter 2026 versus the federal statutory rate of 21% was primarily due to the accrual for state income taxes, partially offset by the amortization of excess accumulated deferred income taxes as a result of tax rate changes and certain book and tax differences related to utility plant items.
The effective income tax rate was 20.5% for the nine months ended September 30, 2026. The difference in the effective income tax rate for the nine months ended September 30, 2026 versus the federal statutory rate of 21% was primarily due to the amortization of excess accumulated deferred income taxes as a result of tax rate changes and certain book and tax differences related to utility plant items, substantially offset by the accrual for state income taxes.
The effective income tax rates were 22% for the third quarter 2025 and 21.4% for the nine months ended September 30, 2025. The differences in the effective income tax rates for the third quarter 2025 and the nine months ended September 30, 2025 versus the federal statutory rate of 21% were primarily due to the accrual for state income taxes, partially offset by the amortization of excess accumulated deferred income taxes as a result of tax rate changes and certain book and tax differences related to utility plant items.
Income Tax Legislation and Regulation
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Income Tax Legislation and Regulation” in the Form 10-K for discussion of income tax legislation and regulation.
Liquidity and Capital Resources
Cash Flow
Cash flows for the nine months ended September 30, 2026 and 2025 were as follows:
| 2026 | 2025 | ||||||||||
| (In Thousands) | |||||||||||
| Cash and cash equivalents at beginning of period | $275,570 | $4,747 | |||||||||
| Net cash provided by (used in): | |||||||||||
| Operating activities | 947,675 | 1,081,700 | |||||||||
| Investing activities | (1,296,773) | (896,720) | |||||||||
| Financing activities | 696,842 | 286,679 | |||||||||
| Net increase in cash and cash equivalents | 347,744 | 471,659 | |||||||||
| Cash and cash equivalents at end of period | $623,314 | $476,406 | |||||||||
Operating Activities
Net cash flow provided by operating activities decreased $134.0 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to:
•the timing of recovery of fuel and purchased power costs. See Note 2 to the financial statements herein and in the Form 10-K for a discussion of fuel and purchased power cost recovery;
•the receipt of $99.2 million in proceeds from the transfer of 2025 nuclear production tax credits to third parties in 2026 as compared to the receipt of $160.2 million in proceeds from the transfer of 2024 nuclear and solar production tax credits to third parties in 2025. See Note 3 to the financial statements in the Form
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10-K and Note 10 to the financial statements herein for discussion of the nuclear and solar production tax credits;
•higher ad valorem tax payments as a result of the timing of payments in 2026 as compared to 2025;
•an increase of $31.7 million in spending on nuclear refueling outage costs in 2026 as compared to 2025; and
•an increase of $22.1 million in interest paid.
The decrease was partially offset by:
•higher collections from customers;
•the receipt of $104.5 million in advance payments related to customer agreements in 2026, including $84.9 million in customer advances and $19.6 million in tax gross-up on customer advances for construction; and
•the timing of payments to vendors.
Investing Activities
Net cash flow used in investing activities increased $400.1 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to:
•an increase of $538 million in non-nuclear generation construction expenditures primarily due to higher spending on the Jefferson Power Station project, the Ironwood Power Station project, and the Arkansas Cypress Solar project;
•an increase of $41.8 million in nuclear construction expenditures primarily due to increased spending on various nuclear projects in 2026; and
•an increase of $16.5 million in cash used as a result of fluctuations in nuclear fuel activity due to variations from year to year in the timing and pricing of fuel reload requirements, materials and services deliveries, and the timing of cash payments during the nuclear fuel cycle.
The increase was partially offset by:
•money pool activity;
•a decrease of $43.1 million in capital expenditures related to storm restoration primarily due to lower spending on minor storms in 2026 as compared to 2025, partially offset by an increase due to Winter Storm Fern restoration efforts in 2026. See “Winter Storm Fern” above for discussion of storm restoration efforts in 2026;
•a decrease of $37 million in cash collateral posted to support Entergy Arkansas’s obligations to MISO in 2026; and
•a decrease of $20.3 million in decommissioning trust fund investment activity.
Increases in Entergy Arkansas’s receivable from the money pool are a use of cash flow, and Entergy Arkansas’s receivable from the money pool increased $2.6 million for the nine months ended September 30, 2026 compared to increasing by $120.3 million for the nine months ended September 30, 2025. The money pool is an intercompany cash management program that makes possible intercompany borrowing and lending arrangements, and the money pool and other borrowing arrangements are designed to reduce the Registrant Subsidiaries’ dependence on external short-term borrowings.
Financing Activities
Net cash flow provided by financing activities increased $410.2 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to:
•the issuances of $500 million of 5.75% Series mortgage bonds and $500 million of 4.95% Series mortgage bonds, each in January 2026;
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•a capital contribution of $200 million received from Entergy Corporation in 2026 in order to maintain Entergy Arkansas’s capital structure;
•the issuance of $120 million of 5.28% Series P notes by the Entergy Arkansas nuclear fuel company variable interest entity in July 2026;
•an increase of $94.6 million in net customer advances for construction related to transmission, distribution, and generator interconnection agreements; and
•money pool activity.
The increase was partially offset by:
•the repayment of $600 million of 3.5% Series mortgage bonds in February 2026;
•the issuance of $300 million of 5.45% Series mortgage bonds in May 2025;
•the repayment of $90 million of 1.84% Series N notes by the Entergy Arkansas nuclear fuel company variable interest entity in July 2026; and
•net repayments of $13.7 million in 2026 as compared to net long-term borrowings of $1.6 million in 2025 on the nuclear fuel company variable interest entity’s credit facility.
Decreases in Entergy Arkansas’s payable to the money pool are a use of cash flow, and Entergy Arkansas’s payable to the money pool decreased $15.2 million for the nine months ended September 30, 2025.
See Note 4 to the financial statements herein and Note 5 to the financial statements in the Form 10-K for more details on long-term debt.
Capital Structure
Entergy Arkansas’s debt to capital ratio is shown in the following table. The decrease in the debt to capital ratio for Entergy Arkansas is primarily due to net income in 2026 and a capital contribution of $200 million received from Entergy Corporation in 2026, partially offset by the net issuance of long-term debt in 2026.
| September 30, 2026 | December 31, 2025 | ||||||||||
| Debt to capital | 52.4 | % | 53.7 | % | |||||||
| Effect of subtracting cash | (2.8 | %) | (1.3 | %) | |||||||
| Net debt to net capital (non-GAAP) | 49.6 | % | 52.4 | % | |||||||
Net debt consists of debt less cash and cash equivalents. Debt consists of short-term borrowings, finance lease obligations, and long-term debt, including the currently maturing portion. Capital consists of debt and equity. Net capital consists of capital less cash and cash equivalents. Entergy Arkansas uses the debt to capital ratio in analyzing its financial condition and believes it provides useful information to its investors and creditors in evaluating Entergy Arkansas’s financial condition. The net debt to net capital ratio is a non-GAAP measure. Entergy Arkansas also uses the net debt to net capital ratio in analyzing its financial condition and believes it provides useful information to its investors and creditors in evaluating Entergy Arkansas’s financial condition because net debt indicates Entergy Arkansas’s outstanding debt position that could not be readily satisfied by cash and cash equivalents on hand.
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Uses and Sources of Capital
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Liquidity and Capital Resources” in the Form 10-K for a discussion of Entergy Arkansas’s uses and sources of capital. The following are updates to the information provided in the Form 10-K.
Entergy Arkansas is developing its capital investment plan for 2027 through 2030 and currently anticipates making the following construction and other capital investments during that period:
| 2027 | 2028 | 2029 | 2030 | |||||||||||||||||||||||
| (In Millions) (a) | ||||||||||||||||||||||||||
| Planned construction and capital investments: | ||||||||||||||||||||||||||
| Generation | $2,055 | $1,360 | $725 | $440 | ||||||||||||||||||||||
| Transmission | 270 | 275 | 190 | 145 | ||||||||||||||||||||||
| Distribution | 340 | 375 | 340 | 310 | ||||||||||||||||||||||
| Utility Support | 70 | 70 | 60 | 60 | ||||||||||||||||||||||
| Total | $2,735 | $2,080 | $1,315 | $955 | ||||||||||||||||||||||
(a)Amounts exclude expenditures expected to be funded through customer advances for construction.
In addition to routine capital spending to maintain operations, the capital plan for Entergy Arkansas includes investments in generation projects to modernize, decarbonize, expand, and diversify Entergy Arkansas’s portfolio, as well as to support customer growth, including Ironwood Power Station, Jefferson Power Station, Arkansas Cypress Solar, the White Bluff Unit 1 fuel conversion, and battery energy storage systems; investments in ANO 1 and 2; distribution and Utility support spending to improve reliability and customer experience; transmission spending to improve reliability while also supporting customer growth and renewables expansion; and other investments. Estimated capital expenditures are subject to periodic review and modification and may vary based on the ongoing effects of regulatory constraints and requirements, governmental policies and actions, including trade-related governmental actions, such as tariffs, executive orders, and other measures, including Executive Order 14421 and the Section 232 Proclamation, environmental regulations, business opportunities, market volatility, economic trends, business restructuring, changes in project plans, and the ability to access capital, including any changes to governmental programs, such as loans, grants, guarantees, and other subsidies. Entergy Arkansas is not able to predict the effect of potential changes in regulation and law, changes to governmental programs, such as loans, grants, guarantees, and other subsidies, and governmental policies and actions, such as tariffs, executive orders, and other measures, including Executive Order 14421 and the Section 232 Proclamation, on its current and planned capital projects, including project delays, modifications, and cost increases.
Entergy Arkansas’s receivables from or (payables to) the money pool were as follows:
| September 30, 2026 | December 31, 2025 | September 30, 2025 | December 31, 2024 | |||||||||||||||||
| (In Thousands) | ||||||||||||||||||||
| $24,279 | $21,715 | $120,316 | ($15,190) | |||||||||||||||||
See Note 4 to the financial statements in the Form 10-K for a description of the money pool.
Entergy Arkansas has a credit facility in the amount of $300 million scheduled to expire in June 2031. Entergy Arkansas also has a $25 million credit facility scheduled to expire in April 2028. The $300 million credit facility includes fronting commitments for the issuance of letters of credit against $5 million of the borrowing capacity of the facility. As of September 30, 2026, there were no cash borrowings under either credit facility and no letters of credit outstanding under the $300 million credit facility. In addition, Entergy Arkansas is a party to two uncommitted letter of credit facilities as a means to post collateral to support its obligations to MISO. As of
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September 30, 2026, $177.5 million in letters of credit were outstanding under Entergy Arkansas’s uncommitted letter of credit facilities. See Note 4 to the financial statements herein for additional discussion of the credit facilities.
The Entergy Arkansas nuclear fuel company variable interest entity has a credit facility in the amount of $80 million scheduled to expire in June 2029. As of September 30, 2026, there were no loans outstanding under the credit facility for the Entergy Arkansas nuclear fuel company variable interest entity. See Note 4 to the financial statements herein for discussion of the nuclear fuel company variable interest entity credit facility.
Jefferson Power Station
As discussed in the Form 10-K, in August 2025, Entergy Arkansas filed an application with the APSC seeking a certificate of environmental compatibility and public need for the construction and operation of Jefferson Power Station, an approximately 754 MW natural gas-fired combined cycle combustion turbine facility to be located in Jefferson County, Arkansas. The estimated cost of the project is $1,602 million. In January 2026 the APSC issued its order finding that Entergy Arkansas had demonstrated a need for the resource but had not met its burden with respect to supporting the prudence of the costs to construct the resource. The APSC acknowledged that the costs would be greater if Entergy Arkansas waited to pursue the resource. The APSC authorized Entergy Arkansas to proceed with Jefferson Power Station as a strategic investment with estimated costs set at a benchmark, which the APSC erroneously believed reflected the current cost estimate but was, in fact, $90 million below the cost presented. In its January 2026 order, the APSC also approved Entergy Arkansas’s recovery of the costs of constructing Jefferson Power Station through the Generating Arkansas Jobs Act rider. Additionally, in its January 2026 order, the APSC found that Entergy Arkansas should conduct all-source competitive solicitations for future generation additions, with limited exceptions where Entergy Arkansas believes that a specific solicitation should be restricted to a certain resource and provides a detailed explanation to the APSC supporting this belief, which the APSC later determined in its March 2026 order is a narrow exception. In February 2026, Entergy Arkansas filed for rehearing seeking to correct the benchmark. In March 2026 the APSC issued an order denying Entergy Arkansas’s petition and maintained the benchmark, although costs over the benchmark were not found to be disallowed. Also in its March 2026 order, the APSC ordered Entergy Arkansas to submit a draft of an all-source request for proposals within thirty days of the order, which Entergy Arkansas filed in April 2026. Also in March 2026, Entergy Arkansas filed with the APSC its proposal for an independent monitor to oversee the reasonableness of its construction costs, as required by the APSC order. In April 2026 the APSC issued an order consolidating Entergy Arkansas’s cost independent monitor proposals for three pending resources, including Jefferson Power Station, into a single docket and directing parties with full intervention status to respond to the proposals and recommend independent monitor candidates. No alternative recommendations were made by the other parties, and the APSC approved Entergy Arkansas’s independent monitor proposal in September 2026. The facility is expected to be in service by the end of 2029.
Special Rate Contract and Arkansas Cypress Solar
As discussed in the Form 10-K, in September 2025, Entergy Arkansas filed an application with the APSC seeking approval of a long-term special rate contract between Altitude Capital, LLC, a subsidiary of Alphabet Inc. (Google) and Entergy Arkansas for the sale of electricity to a new large-scale data center in West Memphis, Arkansas. In December 2025 the APSC issued an order approving the special rate contract but denying the requested ratemaking treatment of Google’s upfront payments and deferring a decision on the treatment under the contract pricing providing for the deferral and amortization of the investment tax credits from the Arkansas Cypress Solar facility (discussed below). Also in December 2025, Entergy Arkansas filed a petition with the APSC regarding these findings, noting that they would require renegotiation of the special rate contract. In January 2026 the APSC issued an order maintaining its position on the ratemaking treatment of Google’s upfront payments but reversing itself on the treatment of the Arkansas Cypress Solar facility investment tax credits and allowing those to be used in the pricing of the Arkansas Cypress Solar facility to Google as provided for in the contract. In October 2026, Entergy Arkansas filed for approval of an amendment to the special rate contract regarding the expansion and
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acceleration of Google’s project in West Memphis. Subject to APSC approval, investments proposed under the amended contract included a 250 MW battery energy storage system to be located at the Driver Solar facility in Mississippi County, Arkansas (Driver Solar battery energy storage system), a 100 MW battery energy storage system to be located adjacent to the existing Arklahoma substation near the in-progress Ironwood Power Station in Hot Spring County, Arkansas (Jones Mill battery energy storage system), a 440 MW solar power purchase agreement from the Big Island Solar facility, and related transmission upgrades and facilities. A procedural schedule has been set with a hearing scheduled for January 2027.
As discussed in the Form 10-K, in September 2025, Entergy Arkansas filed an application with the APSC seeking a certificate of environmental compatibility and public need for the construction and operation of the Arkansas Cypress Solar facility, a planned 600 MW solar photovoltaic array with a 350 MW battery energy storage system and associated transmission facilities interconnecting at Entergy Arkansas’s White Bluff substation. The estimated cost of the project is $1,602 million. In March 2026 the APSC approved the Arkansas Cypress Solar facility and Entergy Arkansas’s recovery of the costs of the facility through the Generating Arkansas Jobs Act rider. The APSC also ordered implementation of an independent monitor to oversee costs. In April 2026, Entergy Arkansas filed with the APSC its proposal for an independent monitor to oversee the reasonableness of costs. In April 2026 the APSC issued an order consolidating Entergy Arkansas’s independent monitor proposals for three pending resources, including the Arkansas Cypress Solar facility, into a single docket and directing parties with full intervention status to respond to the proposals and recommend independent monitor candidates. No alternative recommendations were made by the other parties, and the APSC approved Entergy Arkansas’s independent monitor proposal in September 2026. The facility is expected to be in service by the end of 2028.
In October 2026, Entergy Arkansas filed an application with the APSC seeking a certificate of environmental compatibility and public need for the construction and operation of the Driver Solar battery energy storage system and the Jones Mill battery energy storage system. The battery energy storage systems are being developed to help support the expansion and acceleration of Google’s project in West Memphis. The estimated cost of the Driver Solar battery energy storage system is $389.4 million, and the estimated cost of the Jones Mill battery energy storage system is $161.2 million. Pending receipt of APSC approval, each battery energy storage system is expected to be in service in 2028.
White Bluff Unit 1 Fuel Conversion
In August 2026, Entergy Arkansas filed an application with the APSC seeking a certificate of convenience and necessity or, in the alternative, a certificate of environmental compatibility and public need for the conversion of White Bluff Unit 1 to operate on natural gas. White Bluff Unit 1 is one of two coal-burning generating units at the White Bluff Steam Electric Station facility, which provides dispatchable capacity of approximately 1,659 MW. The estimated cost of the project is $301.3 million, which Entergy Arkansas proposes to recover through the Generating Arkansas Jobs Act rider. In September 2026 the APSC general staff filed testimony opposing the conversion, criticizing Entergy Arkansas’s demonstration of need and asserting that a prior APSC order required Entergy Arkansas to have performed a market test on the conversion. Entergy Arkansas filed a motion seeking a declaratory order to gain procedural clarity from the APSC regarding the interpretation of its prior order. In October 2026 the APSC found Entergy Arkansas’s interpretation of the prior order to be correct and granted Entergy Arkansas’s motion for declaratory order. In October 2026, Entergy Arkansas filed rebuttal testimony addressing the APSC general staff’s recommendations and misinterpretation of key forecast and modeling information. The APSC general staff’s surrebuttal testimony was filed in October 2026. Pending receipt of APSC approval, construction is expected to begin in 2028 and continue through mid 2029.
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State and Local Rate Regulation and Fuel-Cost Recovery
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS – State and Local Rate Regulation and Fuel-Cost Recovery” in the Form 10-K for a discussion of state and local rate regulation and fuel-cost recovery. The following are updates to that discussion.
Retail Rates
2026 Base Rate Case
In February 2026, Entergy Arkansas filed with the APSC a general change in rates, charges, and tariffs. The filing requested a base rate increase to recover a base rate revenue deficiency of $44.6 million and notified the APSC of Entergy Arkansas’s intent to implement a forward test year formula rate plan pursuant to Arkansas legislation passed in 2015. The primary drivers of the revenue deficiency were increased depreciation expense and the impact of net capital additions. Additionally, the filing requested a 9.90% return on common equity and increased depreciation rates as the result of a depreciation study. In March 2026 the APSC issued an order suspending the proposed rates and tariffs filed by Entergy Arkansas. In June 2026 the APSC established a procedural schedule with an evidentiary hearing scheduled to begin in November 2026, and in July 2026 a number of intervenors moved to modify the schedule to conduct additional discovery. Entergy Arkansas opposed the motion in part based on the voluminous discovery conducted to date. In August 2026 the APSC general staff and intervenors filed responsive testimony recommending rate reductions comprised primarily of adjustments to the return on common equity, capital structure, depreciation, working capital, vegetation management, and incentive compensation. In September 2026, Entergy Arkansas filed rebuttal testimony addressing each of the proposed adjustments and supporting its update to actuals, made in accordance with APSC rules, resulting in a reduced base rate revenue deficiency of $28.6 million. In October 2026 the APSC general staff and intervenors filed their last round of testimony, and Entergy Arkansas filed its final round of responsive testimony, which included a revised base rate revenue deficiency of $28.9 million. Also in October 2026, Entergy Arkansas, the APSC general staff, and an intervenor filed a joint motion with the APSC requesting approval of a settlement agreement in the base rate case proceeding. The settlement agreement proposes, among other items: (1) no change in retail revenues as a result of a settlement base rate revenue deficiency of zero; (2) an authorized return on common equity of 9.7%; (3) a capital structure of 47.5% equity and 52.5% debt; and (4) adjustments to depreciation rates reflecting changes to the useful lives of certain assets and net salvage curves. In addition, the settlement includes an acceleration of an estimated credit to customers, resulting from the netting adjustment for the 2026 historical year. That netting adjustment would normally be provided as part of the 2027 evaluation report and included in rates effective January 1, 2028. The settlement proposes that the credit would be included in formula rate plan rates beginning January 1, 2027. Following the filing of the October 2026 joint motion with the APSC, the APSC issued an order clarifying that, because the settlement agreement is not unanimous, the hearing currently scheduled for November 2026 will not be conducted solely as a settlement hearing and directing Entergy Arkansas to file additional information to allow the APSC to fully evaluate the settlement agreement.
2026 Formula Rate Plan Filing
In July 2026, Entergy Arkansas filed with the APSC its 2026 formula rate plan filing to set its formula rate for the 2027 calendar year. The filing contained an evaluation of Entergy Arkansas’s earnings and a netting adjustment for the 2025 historical year. The filing showed that Entergy Arkansas’s earned rate of return on common equity for the 2025 historical year was 8.8%, resulting in a $47.2 million formula rate plan revenue increase to produce a 9.65% earned rate of return on common equity. When combined with 2025 historical year formula rate plan revenues of $56.0 million, the total proposed revenue change for the 2025 historical year netting adjustment is a reduction of $8.8 million. By operation of the formula rate plan, Entergy Arkansas’s recovery of the revenue requirement is subject to a four percent annual revenue constraint. Entergy Arkansas’s revenue requirement in this filing did not exceed the constraint. In second quarter 2026, Entergy Arkansas recorded a regulatory liability of $8.8 million to reflect the amount of the 2025 historical year netting adjustment that it
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Entergy Arkansas, LLC and Subsidiaries
Management's Financial Discussion and Analysis
collected from customers during the 2025 rate effective period. In October 2026, Entergy Arkansas and the APSC staff filed a joint motion requesting to cancel the hearing scheduled for November 2026, and, as there are no contested issues between the parties to the proceeding, requesting the APSC decide this matter consistent with the pleadings and testimony in the record.
Generating Arkansas Jobs Act Rider
In March 2026, Entergy Arkansas filed its first annual update to the Generating Arkansas Jobs Act rider, requesting recovery of $110.4 million of financing costs during construction of generation and transmission strategic investments related to Ironwood Power Station, Jefferson Power Station, and the Arkansas Cypress Solar facility. The revised rates were requested to be effective with the first billing cycle of June 2026. In April 2026 the APSC general staff filed testimony arguing that the APSC had not issued an order designating Ironwood Power Station as a strategic investment and that related costs should therefore be removed from the annual update. Also in April 2026, Entergy Arkansas filed testimony asserting that the APSC general staff’s position is contrary to the plain language of the statute, which includes an exception for facilities like Ironwood Power Station that were certified by the APSC within a certain timeframe. A hearing was held in April 2026. In June 2026 the APSC approved Entergy Arkansas’s annual update, and rates became effective June 4, 2026.
Production Tax Credit Tariffs
As discussed in Note 3 to the financial statements in the Form 10-K, in January 2026 the APSC opened a docket to investigate the sale of Entergy Arkansas’s nuclear production tax credits and the appropriate ratemaking treatment of production tax credits for all of Entergy Arkansas’s eligible resources, including how the proceeds of any sales should flow through to customers. For nuclear production tax credits, Entergy Arkansas proposed a nuclear production tax credit rider, which would provide for the immediate flow through to customers of the weighted average cost of capital return on the net proceeds of the monetized nuclear production tax credits. Recognizing that the timing and determination from the IRS is uncertain, the nuclear production tax credit rider also proposes that, if there is an unfavorable IRS determination, Entergy Arkansas would collect applicable costs from customers. As directed by the APSC, in February 2026, Entergy Arkansas submitted a compliance filing to the APSC verifying the status of the solar production tax credits. The filing also verified that the net proceeds from the sale of the nuclear production tax credits were recorded in FERC accounts that are accruing a return for customers’ benefit at a rate that is above the customer deposit rate. Subsequently, in March 2026, Entergy Arkansas filed testimony setting forth its proposal for the solar production tax credits. Specifically, Entergy Arkansas requested the same ratemaking treatment for all of the solar facilities that the APSC already approved for Walnut Bend (i.e., the total net monetized proceeds from production tax credits expected to be generated over the first ten years of a solar facility’s operation are estimated and then amortized over the expected useful life of the asset, which is typically 30 years). Additionally, consistent with prior orders for these resources, the regulatory liabilities associated with the net cash proceeds from monetized solar production tax credits will be included in Entergy Arkansas’s calculation of its weighted average cost of capital providing a return on the unamortized balance for the benefit of customers. Further, Entergy Arkansas proposes to flow the benefits of the solar production tax credits to customers through Entergy Arkansas’s formula rate plan, effective with the formula rate plan rates that will go into effect January 1, 2027. Entergy Arkansas’s proposal would result in the benefits of the production tax credits being passed through to customers, if approved, as reductions in revenue requirement evenly over the life of the assets, rather than only during the 10-year period in which the production tax credits are generated. In April 2026 the APSC general staff filed testimony proposing an amortization period of no more than 15 years for the monetized proceeds for the tax credits associated with the West Memphis Solar and Driver Solar facilities. An evidentiary hearing was initiated in July 2026 and completed in August 2026.
Energy Cost Recovery Rider
In March 2026, Entergy Arkansas filed its annual redetermination of its energy cost rate pursuant to the energy cost recovery rider, which reflected an increase in the rate from $0.01333 per kWh to $0.01508 per kWh.
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Entergy Arkansas, LLC and Subsidiaries
Management’s Financial Discussion and Analysis
The primary reason for the rate increase was an under-recovered balance as a result of higher natural gas prices in 2025. Based on circumstances related to ANO 2’s refueling outage, Entergy Arkansas made an adjustment to projected energy costs to phase-in the rate increase gradually. The redetermined rate of $0.01508 per kWh became effective with the first billing cycle in April 2026 through the normal operation of the tariff.
Industrial and Commercial Customers
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS – Industrial and Commercial Customers” in the Form 10-K for a discussion of industrial and commercial customers.
Federal Regulation
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS – Federal Regulation” in the Form 10-K and Note 2 to the financial statements herein and in the Form 10-K for a discussion of federal regulation.
Nuclear Matters
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS – Nuclear Matters” in the Form 10-K for a discussion of nuclear matters.
Environmental Risks
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Environmental Risks” in the Form 10-K for a discussion of environmental risks.
Critical Accounting Estimates
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Critical Accounting Estimates” in the Form 10-K for a discussion of the estimates and judgments necessary in Entergy Arkansas’s accounting for nuclear decommissioning costs, utility regulatory accounting, taxation and uncertain tax positions, qualified pension and other postretirement benefits, and other contingencies.
New Accounting Pronouncements
See the “New Accounting Pronouncements” section of Note 1 to the financial statements in the Form 10-K for a discussion of new accounting pronouncements and the “New Accounting Pronouncements” section of Entergy Corporation and Subsidiaries Management’s Financial Discussion and Analysis herein for updates to the discussion of new accounting pronouncements.
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| ENTERGY ARKANSAS, LLC AND SUBSIDIARIES | ||||||||||||||||||||||||||
| CONSOLIDATED INCOME STATEMENTS | ||||||||||||||||||||||||||
| For the Three and Nine Months Ended September 30, 2026 and 2025 | ||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||
| (In Thousands) | (In Thousands) | |||||||||||||||||||||||||
| OPERATING REVENUES | ||||||||||||||||||||||||||
| Electric | $ | $ | $ | $ | ||||||||||||||||||||||
| OPERATING EXPENSES | ||||||||||||||||||||||||||
| Operation and Maintenance: | ||||||||||||||||||||||||||
| Fuel, fuel-related expenses, and gas purchased for resale | ||||||||||||||||||||||||||
| Purchased power | ||||||||||||||||||||||||||
| Nuclear refueling outage expenses | ||||||||||||||||||||||||||
| Other operation and maintenance | ||||||||||||||||||||||||||
| Decommissioning | ||||||||||||||||||||||||||
| Taxes other than income taxes | ||||||||||||||||||||||||||
| Depreciation and amortization | ||||||||||||||||||||||||||
| Other regulatory charges (credits) - net | ( | ( | ( | |||||||||||||||||||||||
| TOTAL | ||||||||||||||||||||||||||
| OPERATING INCOME | ||||||||||||||||||||||||||
| OTHER INCOME | ||||||||||||||||||||||||||
| Allowance for equity funds used during construction | ||||||||||||||||||||||||||
| Interest and investment income | ||||||||||||||||||||||||||
| Miscellaneous - net | ( | ( | ||||||||||||||||||||||||
| TOTAL | ||||||||||||||||||||||||||
| INTEREST EXPENSE | ||||||||||||||||||||||||||
| Interest expense | ||||||||||||||||||||||||||
| Allowance for borrowed funds used during construction | ( | ( | ( | ( | ||||||||||||||||||||||
| TOTAL | ||||||||||||||||||||||||||
| INCOME BEFORE INCOME TAXES | ||||||||||||||||||||||||||
| Income taxes | ||||||||||||||||||||||||||
| NET INCOME | ||||||||||||||||||||||||||
| Net income (loss) attributable to noncontrolling interest | ( | ( | ||||||||||||||||||||||||
| EARNINGS APPLICABLE TO MEMBER'S EQUITY | $ | $ | $ | $ | ||||||||||||||||||||||
| See Notes to Financial Statements. | ||||||||||||||||||||||||||
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| ENTERGY ARKANSAS, LLC AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||
| For the Nine Months Ended September 30, 2026 and 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| OPERATING ACTIVITIES | ||||||||||||||
| Net income | $ | $ | ||||||||||||
| Adjustments to reconcile net income to net cash flow provided by operating activities: | ||||||||||||||
| Depreciation, amortization, and decommissioning, including nuclear fuel amortization | ||||||||||||||
| Deferred income taxes, tax credits, and non-current taxes accrued | ||||||||||||||
| Changes in assets and liabilities: | ||||||||||||||
| Receivables | ( | ( | ||||||||||||
| Fuel inventory | ( | ( | ||||||||||||
| Accounts payable | ||||||||||||||
| Taxes accrued | ( | |||||||||||||
| Interest accrued | ||||||||||||||
| Deferred fuel costs | ( | ( | ||||||||||||
| Other working capital accounts | ( | ( | ||||||||||||
| Provisions for estimated losses | ||||||||||||||
| Other regulatory assets | ( | |||||||||||||
| Other regulatory liabilities | ||||||||||||||
| Customer advances - non-current | ||||||||||||||
| Pension and other postretirement funded status | ( | ( | ||||||||||||
| Other assets and liabilities | ( | ( | ||||||||||||
| Net cash flow provided by operating activities | ||||||||||||||
| INVESTING ACTIVITIES | ||||||||||||||
| Construction expenditures | ( | ( | ||||||||||||
| Allowance for equity funds used during construction | ||||||||||||||
| Payment for purchase of plant and assets | ( | ( | ||||||||||||
| Nuclear fuel purchases | ( | ( | ||||||||||||
| Proceeds from sale of nuclear fuel | ||||||||||||||
| Proceeds from nuclear decommissioning trust fund sales | ||||||||||||||
| Investment in nuclear decommissioning trust funds | ( | ( | ||||||||||||
| Changes in money pool receivable - net | ( | ( | ||||||||||||
Other | ||||||||||||||
| Net cash flow used in investing activities | ( | ( | ||||||||||||
| FINANCING ACTIVITIES | ||||||||||||||
| Proceeds from the issuance of long-term debt | ||||||||||||||
| Retirement of long-term debt | ( | ( | ||||||||||||
| Capital contribution from parent | ||||||||||||||
| Change in money pool payable - net | ( | |||||||||||||
| Customer advances received for construction | ||||||||||||||
| Customer advances used for construction | ( | ( | ||||||||||||
| Other | ( | ( | ||||||||||||
| Net cash flow provided by financing activities | ||||||||||||||
| Net increase in cash and cash equivalents | ||||||||||||||
| Cash and cash equivalents at beginning of period | ||||||||||||||
| Cash and cash equivalents at end of period | $ | $ | ||||||||||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||||||||||||||
| Cash paid (received) during the period for: | ||||||||||||||
| Interest - net of amount capitalized | $ | $ | ||||||||||||
Income taxes - net (includes proceeds from the transfer of production tax credits to third parties of $ | ($ | ($ | ||||||||||||
| Noncash investing activities: | ||||||||||||||
| Accrued construction expenditures | $ | $ | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| ENTERGY ARKANSAS, LLC AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||||||||
| ASSETS | ||||||||||||||
| September 30, 2026 and December 31, 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| CURRENT ASSETS | ||||||||||||||
| Cash and cash equivalents: | ||||||||||||||
| Cash | $ | $ | ||||||||||||
| Temporary cash investments | ||||||||||||||
| Total cash and cash equivalents | ||||||||||||||
| Accounts receivable: | ||||||||||||||
| Customer | ||||||||||||||
| Allowance for doubtful accounts | ( | ( | ||||||||||||
| Associated companies | ||||||||||||||
| Other | ||||||||||||||
| Accrued unbilled revenues | ||||||||||||||
| Total accounts receivable | ||||||||||||||
| Deferred fuel costs | ||||||||||||||
| Fuel inventory - at average cost | ||||||||||||||
| Materials and supplies | ||||||||||||||
| Deferred nuclear refueling outage costs | ||||||||||||||
| Prepayments and other | ||||||||||||||
| TOTAL | ||||||||||||||
| OTHER PROPERTY AND INVESTMENTS | ||||||||||||||
| Decommissioning trust funds | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| UTILITY PLANT | ||||||||||||||
| Electric | ||||||||||||||
| Construction work in progress | ||||||||||||||
| Nuclear fuel | ||||||||||||||
| TOTAL UTILITY PLANT | ||||||||||||||
| Less - accumulated depreciation and amortization | ||||||||||||||
| UTILITY PLANT - NET | ||||||||||||||
| DEFERRED DEBITS AND OTHER ASSETS | ||||||||||||||
| Regulatory assets: | ||||||||||||||
| Other regulatory assets | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| TOTAL ASSETS | $ | $ | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| ENTERGY ARKANSAS, LLC AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||||||||
| LIABILITIES AND EQUITY | ||||||||||||||
| September 30, 2026 and December 31, 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| CURRENT LIABILITIES | ||||||||||||||
| Currently maturing long-term debt | $ | $ | ||||||||||||
| Accounts payable: | ||||||||||||||
| Associated companies | ||||||||||||||
| Other | ||||||||||||||
| Customer deposits | ||||||||||||||
| Taxes accrued | ||||||||||||||
| Interest accrued | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| NON-CURRENT LIABILITIES | ||||||||||||||
| Accumulated deferred income taxes and taxes accrued | ||||||||||||||
| Accumulated deferred investment tax credits | ||||||||||||||
| Regulatory liability for income taxes - net | ||||||||||||||
| Other regulatory liabilities | ||||||||||||||
| Customer advances | ||||||||||||||
| Decommissioning | ||||||||||||||
| Accumulated provisions | ||||||||||||||
| Long-term debt | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| Commitments and Contingencies | ||||||||||||||
| EQUITY | ||||||||||||||
| Member's equity | ||||||||||||||
| Noncontrolling interest | ||||||||||||||
| TOTAL | ||||||||||||||
| TOTAL LIABILITIES AND EQUITY | $ | $ | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| ENTERGY ARKANSAS, LLC AND SUBSIDIARIES | |||||||||||||||||
| CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY | |||||||||||||||||
| For the Nine Months Ended September 30, 2026 and 2025 | |||||||||||||||||
| (Unaudited) | |||||||||||||||||
| Noncontrolling Interest | Member's Equity | Total | |||||||||||||||
| (In Thousands) | |||||||||||||||||
| Balance at December 31, 2024 | $ | $ | $ | ||||||||||||||
| Net income (loss) | ( | ||||||||||||||||
| Distributions to noncontrolling interest | ( | — | ( | ||||||||||||||
| Balance at March 31, 2025 | |||||||||||||||||
| Net income (loss) | ( | ||||||||||||||||
| Distributions to noncontrolling interest | ( | — | ( | ||||||||||||||
| Balance at June 30, 2025 | |||||||||||||||||
| Net income (loss) | ( | ||||||||||||||||
| Distributions to noncontrolling interest | ( | — | ( | ||||||||||||||
| Balance at September 30, 2025 | $ | $ | $ | ||||||||||||||
| Balance at December 31, 2025 | $ | $ | $ | ||||||||||||||
| Net income | |||||||||||||||||
| Distributions to noncontrolling interest | ( | — | ( | ||||||||||||||
| Balance at March 31, 2026 | |||||||||||||||||
| Net income (loss) | ( | ||||||||||||||||
| Capital contribution from parent | — | ||||||||||||||||
| Distributions to noncontrolling interest | ( | — | ( | ||||||||||||||
| Balance at June 30, 2026 | |||||||||||||||||
| Net income | |||||||||||||||||
| Distributions to noncontrolling interest | ( | — | ( | ||||||||||||||
| Balance at September 30, 2026 | $ | $ | $ | ||||||||||||||
| See Notes to Financial Statements. | |||||||||||||||||
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ENTERGY LOUISIANA, LLC AND SUBSIDIARIES
MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS
Winter Storm Fern
See the “Winter Storm Fern” section of Entergy Corporation and Subsidiaries Management’s Financial Discussion and Analysis for a discussion of Winter Storm Fern. Entergy Louisiana’s cost of mobilizing crews and restoring power was approximately $240 million, including approximately $205 million in capital costs and approximately $35 million in non-capital costs. Natural gas purchases for Entergy Louisiana were $256 million in January 2026 compared to $115 million in January 2025. See Note 2 to the financial statements herein and in the Form 10-K for discussion of fuel cost recovery at Entergy Louisiana. See Note 2 to the financial statements herein for discussion of restoration costs from Winter Storm Fern included in the 2025 formula rate plan filing.
Results of Operations
Net Income
Third Quarter 2026 Compared to Third Quarter 2025
Net income increased $94.1 million primarily due to higher retail electric price, higher volume/weather, higher other income, and higher revenues resulting from the return on construction work in progress for certain utility plant investments. The increase was partially offset by higher interest expense, higher other operation and maintenance expenses, higher depreciation and amortization expenses, and higher taxes other than income taxes.
Nine Months Ended September 30, 2026 Compared to Nine Months Ended September 30, 2025
Net income increased $128.4 million primarily due to higher retail electric price, higher revenues resulting from the return on construction work in progress for certain utility plant investments, higher volume/weather, higher other income, and a lower effective income tax rate. The increase was partially offset by higher interest expense, higher other operation and maintenance expenses, higher depreciation and amortization expenses, and higher taxes other than income taxes.
Operating Revenues
Third Quarter 2026 Compared to Third Quarter 2025
Following is an analysis of the change in operating revenues comparing the third quarter 2026 to the third quarter 2025:
| Amount | |||||
| (In Millions) | |||||
| 2025 operating revenues | $1,633.2 | ||||
| Fuel, rider, and other revenues that do not significantly affect net income | (79.0) | ||||
| Retail electric price | 95.7 | ||||
| Volume/weather | 54.0 | ||||
| Return on construction work in progress for certain utility plant investments | 35.0 | ||||
| 2026 operating revenues | $1,738.9 | ||||
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Entergy Louisiana, LLC and Subsidiaries
Management’s Financial Discussion and Analysis
Entergy Louisiana’s results include revenues from rate mechanisms designed to recover fuel, purchased power, and other costs such that the revenues and expenses associated with these items generally offset and do not affect net income. “Fuel, rider, and other revenues that do not significantly affect net income” includes the revenue variance associated with these items.
The retail electric price variance is primarily due to:
•an increase in formula rate plan rates effective September 2026;
•a decrease in formula rate plan revenues for a two-month period beginning September 2025 resulting from earnings above the authorized return on common equity for the 2024 test year; and
•increases in the resilience plan cost recovery rider effective March 2026 and September 2026.
See Note 2 to the financial statements herein for discussion of the resilience plan cost recovery rider filings and the 2025 formula rate plan proceeding and Note 2 to the financial statements in the Form 10-K for discussion of the 2024 formula rate plan proceeding.
The volume/weather variance is primarily due to an increase in weather-adjusted residential and commercial usage and the effect of more favorable weather on residential and commercial sales.
The return on construction work in progress for certain utility plant investments variance represents the revenue related to the amortization of certain customer advances designed to provide a return on investment in construction work in progress for certain utility plant investments, which is recognized as the related construction costs are incurred.
Total electric energy sales for Entergy Louisiana for the three months ended September 30, 2026 and 2025 are as follows:
| 2026 | 2025 | % Change | |||||||||||||||
| (GWh) | |||||||||||||||||
| Residential | 5,028 | 4,546 | 11 | ||||||||||||||
| Commercial | 3,438 | 3,297 | 4 | ||||||||||||||
| Industrial | 9,338 | 9,442 | (1) | ||||||||||||||
| Governmental | 200 | 213 | (6) | ||||||||||||||
| Total retail | 18,004 | 17,498 | 3 | ||||||||||||||
| Sales for resale: | |||||||||||||||||
| Associated companies | 1,123 | 2,064 | (46) | ||||||||||||||
| Non-associated companies | 383 | 257 | 49 | ||||||||||||||
| Total | 19,510 | 19,819 | (2) | ||||||||||||||
See Note 12 to the financial statements herein for additional discussion of Entergy Louisiana’s operating revenues.
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Entergy Louisiana, LLC and Subsidiaries
Management’s Financial Discussion and Analysis
Nine Months Ended September 30, 2026 Compared to Nine Months Ended September 30, 2025
Following is an analysis of the change in operating revenues comparing the nine months ended September 30, 2026 to the nine months ended September 30, 2025:
| Amount | |||||
| (In Millions) | |||||
| 2025 operating revenues | $4,444.8 | ||||
| Fuel, rider, and other revenues that do not significantly affect net income | 83.7 | ||||
| Retail electric price | 133.3 | ||||
| Return on construction work in progress for certain utility plant investments | 78.2 | ||||
| Volume/weather | 73.6 | ||||
| Effect of sale of natural gas distribution business | (44.3) | ||||
| 2026 operating revenues | $4,769.3 | ||||
Entergy Louisiana’s results include revenues from rate mechanisms designed to recover fuel, purchased power, and other costs such that the revenues and expenses associated with these items generally offset and do not affect net income. “Fuel, rider, and other revenues that do not significantly affect net income” includes the revenue variance associated with these items.
The retail electric price variance is primarily due to:
•an increase in formula rate plan rates effective September 2026;
•a decrease in formula rate plan revenues for a two-month period beginning September 2025 resulting from earnings above the authorized return on common equity for the 2024 test year; and
•increases in the resilience plan cost recovery rider effective March 2025, March 2026, and September 2026.
See Note 2 to the financial statements herein for discussion of the resilience plan cost recovery rider filings and the 2025 formula rate plan proceeding and Note 2 to the financial statements in the Form 10-K for discussion of the 2024 formula rate plan proceeding.
The return on construction work in progress for certain utility plant investments variance represents the revenue related to the amortization of certain customer advances designed to provide a return on investment in construction work in progress for certain utility plant investments, which is recognized as the related construction costs are incurred.
The volume/weather variance is primarily due to increases in industrial and residential usage. The increase in industrial usage is primarily due to an increase in demand from large industrial customers, primarily petroleum refining, chlor-alkali, and petrochemicals customers, and an increase in demand from co-generation customers.
The effect of sale of natural gas distribution business variance represents the decrease in operating revenues resulting from the absence of natural gas revenues following the sale of the natural gas distribution business on July 1, 2025. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy Louisiana natural gas distribution business on July 1, 2025.
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Entergy Louisiana, LLC and Subsidiaries
Management’s Financial Discussion and Analysis
Total electric energy sales for Entergy Louisiana for the nine months ended September 30, 2026 and 2025 are as follows:
| 2026 | 2025 | % Change | |||||||||||||||
| (GWh) | |||||||||||||||||
| Residential | 11,463 | 11,299 | 1 | ||||||||||||||
| Commercial | 8,723 | 8,615 | 1 | ||||||||||||||
| Industrial | 28,199 | 27,159 | 4 | ||||||||||||||
| Governmental | 588 | 611 | (4) | ||||||||||||||
| Total retail | 48,973 | 47,684 | 3 | ||||||||||||||
| Sales for resale: | |||||||||||||||||
| Associated companies | 4,034 | 5,045 | (20) | ||||||||||||||
| Non-associated companies | 891 | 652 | 37 | ||||||||||||||
| Total | 53,898 | 53,381 | 1 | ||||||||||||||
See Note 12 to the financial statements herein for additional discussion of Entergy Louisiana’s operating revenues.
Other Income Statement Variances
Third Quarter 2026 Compared to Third Quarter 2025
Other operation and maintenance expenses increased primarily due to:
•a $17.5 million gain, recorded in third quarter 2025, resulting from the sale of the natural gas distribution business on July 1, 2025. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of Entergy Louisiana’s natural gas distribution business;
•an increase of $7.7 million in power delivery expenses primarily due to higher vegetation maintenance costs;
•an increase of $5 million in energy efficiency expenses primarily due to the timing of recovery from customers; and
•several individually insignificant items.
The increase was partially offset by the expensing of $10.8 million of project costs associated with the Bayou Power Station project following Entergy Louisiana’s election in third quarter 2025 to cancel the project and evaluate an alternative transmission solution. See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Liquidity and Capital Resources” in the Form 10-K for discussion of the Bayou Power Station project.
Taxes other than income taxes increased primarily due to increases in ad valorem taxes resulting from higher assessments.
Depreciation and amortization expenses increased primarily due to additions to plant in service, an increase in FERC jurisdictional depreciation rates effective January 2026, and increases in nuclear depreciation rates effective September 2025 and September 2026 in accordance with the global stipulated settlement agreement approved by the LPSC in August 2024. See Note 2 to the financial statements in the Form 10-K for discussion of the global stipulated settlement agreement.
Entergy Louisiana records a regulatory charge or credit for the difference between asset retirement obligation-related expenses and nuclear decommissioning trust earnings plus asset retirement obligation-related costs collected in revenue.
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Other income increased primarily due to:
•an increase of $15.4 million in interest earned on money pool investments;
•an increase in the allowance for equity funds used during construction due to higher construction work in progress in 2026, including the Amite South transmission projects;
•an increase of $11.1 million in the amortization of tax gross-up on customer advances, including customer advances for construction; and
•changes in decommissioning trust fund activity, including portfolio rebalancing of the River Bend decommissioning trust fund in third quarter 2026.
The increase was partially offset by a decrease of $4.6 million in affiliated dividend income from affiliated preferred membership interests related to storm cost securitizations. See Note 2 to the financial statements in the Form 10-K for discussion of the storm cost securitizations.
Interest expense increased primarily due to:
•an increase of $23 million in carrying costs on customer advances, including customer advances for construction;
•the issuances of $750 million of 5.65% Series mortgage bonds and $750 million of 4.90% Series mortgage bonds, each in February 2026;
•the issuances of $500 million of 5.50% Series mortgage bonds and $500 million of 6.20% Series mortgage bonds, each in August 2026; and
•$4.2 million in carrying costs in third quarter 2026 on retained net proceeds from the monetization of nuclear production tax credits.
The increase was partially offset by an increase in the allowance for borrowed funds used during construction due to higher construction work in progress in 2026, including the Amite South transmission projects.
Nine Months Ended September 30, 2026 Compared to Nine Months Ended September 30, 2025
Other operation and maintenance expenses increased primarily due to:
•a $17.5 million gain, recorded in third quarter 2025, resulting from the sale of the natural gas distribution business on July 1, 2025. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of Entergy Louisiana’s natural gas distribution business;
•an increase of $16.3 million in power delivery expenses primarily due to higher vegetation maintenance costs;
•an increase of $11.6 million in compensation and benefits costs primarily due to a larger revision to estimated incentive-based compensation expense in 2025, higher healthcare claims activity, and the timing of the recognition of prescription drug rebates;
•an increase of $8.5 million in nuclear generation expenses primarily due to a higher scope of work performed in 2026 as compared to 2025;
•an increase of $6 million in energy efficiency expenses primarily due to the timing of recovery from customers; and
•several individually insignificant items.
The increase was partially offset by the expensing of $10.8 million of project costs associated with the Bayou Power Station project following Entergy Louisiana’s election in third quarter 2025 to cancel the project and evaluate an alternative transmission solution and a decrease of $7.4 million in loss provisions. See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Liquidity and Capital Resources” in the Form 10-K for discussion of the Bayou Power Station project.
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Taxes other than income taxes increased primarily due to increases in ad valorem taxes resulting from higher assessments.
Depreciation and amortization expenses increased primarily due to additions to plant in service, an increase in FERC jurisdictional depreciation rates effective January 2026, and increases in nuclear depreciation rates effective September 2025 and September 2026 in accordance with the global stipulated settlement agreement approved by the LPSC in August 2024. See Note 2 to the financial statements in the Form 10-K for discussion of the global stipulated settlement agreement.
Entergy Louisiana records a regulatory charge or credit for the difference between asset retirement obligation-related expenses and nuclear decommissioning trust earnings plus asset retirement obligation-related costs collected in revenue.
Other income increased primarily due to:
•changes in decommissioning trust fund activity, including portfolio rebalancing of certain decommissioning trust funds in 2026;
•an increase of $40.2 million in the amortization of tax gross-up on customer advances, including customer advances for construction;
•an increase of $25.1 million in interest earned on money pool investments; and
•an increase in the allowance for equity funds used during construction due to higher construction work in progress in 2026, including the Amite South transmission projects.
The increase was partially offset by a $17.1 million true-up in 2025 of Entergy Louisiana's MISO cost recovery mechanism over-recovery balance to the 2024 formula rate plan filing, which was filed with the LPSC in May 2025, and a decrease of $13.6 million in affiliated dividend income from affiliated preferred membership interests related to storm cost securitizations. See Note 2 to the financial statements in the Form 10-K for discussion of the 2024 formula rate plan filing and the storm cost securitizations.
Interest expense increased primarily due to:
•the issuances of $750 million of 5.65% Series mortgage bonds and $750 million of 4.90% Series mortgage bonds, each in February 2026;
•an increase of $45.8 million in carrying costs on customer advances, including customer advances for construction;
•$12.3 million in carrying costs in 2026 on retained net proceeds from the monetization of nuclear production tax credits; and
•the issuances of $500 million of 5.50% Series mortgage bonds and $500 million of 6.20% Series mortgage bonds, each in August 2026.
The increase was partially offset by an increase in the allowance for borrowed funds used during construction due to higher construction work in progress in 2026, including the Amite South transmission projects, and lower interest expense due to the repayment of $250 million of 4.44% Series mortgage bonds in January 2026.
Income Taxes
The effective income tax rates were 19.7% for the third quarter 2026 and 17.8% for the nine months ended September 30, 2026. The differences in the effective income tax rates for the third quarter 2026 and the nine months ended September 30, 2026 versus the federal statutory rate of 21% were primarily due to the book and tax differences related to the non-taxable income distributions earned on preferred membership interests, the amortization of excess accumulated deferred income taxes as a result of tax rate changes, book and tax differences
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related to the allowance for equity funds used during construction, and certain book and tax differences related to utility plant items, partially offset by the accrual for state income taxes.
The effective income tax rates were 19.5% for the third quarter 2025 and 19% for the nine months ended September 30, 2025. The differences in the effective income tax rates for the third quarter 2025 and the nine months ended September 30, 2025 versus the federal statutory rate of 21% were primarily due to the book and tax differences related to the non-taxable income distributions earned on preferred membership interests, partially offset by the accrual for state income taxes.
Income Tax Legislation and Regulation
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Income Tax Legislation and Regulation” in the Form 10-K for discussion of income tax legislation and regulation.
Sale of Natural Gas Distribution Business
See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy Louisiana natural gas distribution business on July 1, 2025.
Liquidity and Capital Resources
Cash Flow
Cash flows for the nine months ended September 30, 2026 and 2025 were as follows:
| 2026 | 2025 | ||||||||||
| (In Thousands) | |||||||||||
| Cash and cash equivalents at beginning of period | $776,961 | $327,102 | |||||||||
| Net cash provided by (used in): | |||||||||||
| Operating activities | 2,672,963 | 1,762,375 | |||||||||
| Investing activities | (3,740,742) | (2,021,195) | |||||||||
| Financing activities | 2,572,647 | 307,958 | |||||||||
| Net increase in cash and cash equivalents | 1,504,868 | 49,138 | |||||||||
| Cash and cash equivalents at end of period | $2,281,829 | $376,240 | |||||||||
Operating Activities
Net cash flow provided by operating activities increased $910.6 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to:
•an increase of $906.8 million in receipts of advance payments related to customer agreements, including $803.5 million in customer advances and $103.3 million in tax gross-up on customer advances for construction;
•higher collections from customers;
•a decrease of $39.2 million in spending on nuclear refueling outage costs in 2026 as compared to 2025; and
•a decrease of $31.5 million in interest paid.
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The increase was partially offset by:
•the receipt of $55.8 million in proceeds from the transfer of 2025 nuclear production tax credits to third parties in 2026 as compared to the receipt of $146.4 million in proceeds from the transfer of 2024 nuclear production tax credits to third parties in 2025. See Note 3 to the financial statements in the Form 10-K and Note 10 to the financial statements herein for discussion of the nuclear production tax credits;
•higher fuel and purchased power payments. See Note 2 to the financial statements herein and in the Form 10-K for a discussion of fuel and purchased power cost recovery;
•the timing of payments to vendors; and
•an increase of $13 million in non-capital storm spending primarily due to Winter Storm Fern restoration efforts in 2026. See “Winter Storm Fern” above for discussion of storm restoration efforts in 2026.
Investing Activities
Net cash flow used in investing activities increased $1,719.5 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to:
•an increase of $1,249.3 million in non-nuclear generation construction expenditures primarily due to higher spending on the Richland Parish Power Station Units 1-4 project, the Waterford 5 Power Station project, the Westlake Power Station project, the Pointe Coupee Units 1-3 project, and the Waterford 6 Power Station project;
•an increase of $475.6 million in transmission construction expenditures primarily due to higher capital expenditures as a result of higher spending on the Amite South transmission projects and on various other transmission projects in 2026;
•the receipt of $203 million in proceeds from the sale of the natural gas distribution business on July 1, 2025. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of Entergy Louisiana’s natural gas distribution business on July 1, 2025;
•an increase of $152.8 million in capital expenditures related to storm restoration primarily due to Winter Storm Fern restoration efforts in 2026. See “Winter Storm Fern” above for discussion of storm restoration efforts in 2026; and
•the receipt of $33.5 million from the storm reserve escrow account in 2025. See Note 2 to the financial statements in the Form 10-K for a discussion of the storm reserve funds.
The increase was partially offset by:
•a decrease of $125.2 million in nuclear construction expenditures primarily due to decreased spending on various nuclear projects in 2026;
•cash collateral of $37 million posted to support Entergy Louisiana's obligations to MISO in 2025, of which $32.8 million was returned by MISO to Entergy Louisiana in 2026;
•payments totaling $41.4 million to Entergy Texas for the transfer of assets related to the Segno Solar and Votaw Solar facilities to Entergy Louisiana in 2025;
•money pool activity;
•a decrease of $24 million in cash used as a result of fluctuations in nuclear fuel activity due to variations from year to year in the timing and pricing of fuel reload requirements, materials and services deliveries, and the timing of cash payments during the nuclear fuel cycle; and
•a decrease of $18.9 million in decommissioning trust fund investment activity.
Increases in Entergy Louisiana’s receivable from the money pool are a use of cash flow, and Entergy Louisiana’s receivable from the money pool increased $26.6 million for the nine months ended September 30, 2026 compared to increasing by $64.8 million for the nine months ended September 30, 2025. The money pool is an intercompany cash management program that makes possible intercompany borrowing and lending arrangements,
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and the money pool and other borrowing arrangements are designed to reduce the Registrant Subsidiaries’ dependence on external short-term borrowings.
Financing Activities
Net cash flow provided by financing activities increased $2,264.7 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to:
•the issuances of $750 million of 5.65% Series mortgage bonds and $750 million of 4.90% Series mortgage bonds, each in February 2026;
•the issuances of $500 million of 5.50% Series mortgage bonds and $500 million of 6.20% Series mortgage bonds, each in August 2026;
•$546 million in common equity distributions paid in 2025 in order to maintain Entergy Louisiana’s capital structure. No common equity distributions were paid in 2026;
•the repayment of $190 million of 3.78% Series mortgage bonds in March 2025; and
•the repayment of $110 million of 3.78% Series mortgage bonds in March 2025.
The increase was partially offset by:
•the issuance of $750 million of 5.80% Series mortgage bonds in January 2025;
•the repayment of $250 million of 4.44% Series mortgage bonds in January 2026; and
•net repayments of $2.4 million in 2026 compared to net long-term borrowings of $82.2 million in 2025 on the nuclear fuel company variable interest entities’ credit facilities.
See Note 4 to the financial statements herein and Note 5 to the financial statements in the Form 10-K for more details on long-term debt.
Capital Structure
Entergy Louisiana’s debt to capital ratio is shown in the following table. The increase in the debt to capital ratio for Entergy Louisiana is primarily due to the net issuance of long-term debt in 2026, partially offset by net income in 2026.
| September 30, 2026 | December 31, 2025 | ||||||||||
| Debt to capital | 49.4 | % | 46.6 | % | |||||||
| Effect of subtracting cash | (5.0 | %) | (2.0 | %) | |||||||
| Net debt to net capital (non-GAAP) | 44.4 | % | 44.6 | % | |||||||
Net debt consists of debt less cash and cash equivalents. Debt consists of short-term borrowings, finance lease obligations, and long-term debt, including the currently maturing portion. Capital consists of debt and equity. Net capital consists of capital less cash and cash equivalents. Entergy Louisiana uses the debt to capital ratio in analyzing its financial condition and believes it provides useful information to its investors and creditors in evaluating Entergy Louisiana’s financial condition. The net debt to net capital ratio is a non-GAAP measure. Entergy Louisiana also uses the net debt to net capital ratio in analyzing its financial condition and believes it provides useful information to its investors and creditors in evaluating Entergy Louisiana’s financial condition because net debt indicates Entergy Louisiana’s outstanding debt position that could not be readily satisfied by cash and cash equivalents on hand.
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Uses and Sources of Capital
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Liquidity and Capital Resources” in the Form 10-K for a discussion of Entergy Louisiana’s uses and sources of capital. The following are updates to the information provided in the Form 10-K.
Entergy Louisiana is developing its capital investment plan for 2027 through 2030 and currently anticipates making the following construction and other capital investments during that period:
| 2027 | 2028 | 2029 | 2030 | ||||||||||||||||||||
| (In Millions) (a) | |||||||||||||||||||||||
| Planned construction and capital investments: | |||||||||||||||||||||||
| Generation | $8,460 | $8,060 | $6,670 | $5,075 | |||||||||||||||||||
| Transmission | 1,595 | 1,415 | 950 | 570 | |||||||||||||||||||
| Distribution | 910 | 545 | 610 | 535 | |||||||||||||||||||
| Utility Support | 105 | 65 | 75 | 80 | |||||||||||||||||||
| Total | $11,070 | $10,085 | $8,305 | $6,260 | |||||||||||||||||||
(a)Amounts exclude expenditures expected to be funded through customer advances for construction.
In addition to routine capital spending to maintain operations, the capital plan for Entergy Louisiana includes investments in generation projects to modernize, decarbonize, expand, and diversify Entergy Louisiana’s portfolio, as well as to support customer growth, including Segno Solar, Votaw Solar, Bogalusa West Solar, Cypress Harvest Solar, Franklin Farms Power Station Units 1 and 2, Waterford 5 Power Station, Cottonwood Power Station, Westlake Power Station, Richland Parish Units 1-4, Pointe Coupee Units 1-3, Waterford 6 Power Station, battery energy storage systems, and other new generation resources; investments in River Bend and Waterford 3; distribution and Utility support spending to improve reliability, resilience, and customer experience; transmission spending to improve reliability and resilience while also supporting customer growth and renewables expansion; and other investments. Estimated capital expenditures are subject to periodic review and modification and may vary based on the ongoing effects of regulatory constraints and requirements, governmental policies and actions, including trade-related governmental actions, such as tariffs, executive orders, and other measures, including Executive Order 14421 and the Section 232 Proclamation, environmental regulations, business opportunities, market volatility, economic trends, business restructuring, changes in project plans, and the ability to access capital, including any changes to governmental programs, such as loans, grants, guarantees, and other subsidies. Entergy Louisiana is not able to predict the effect of potential changes in regulation and law, changes to governmental programs, such as loans, grants, guarantees, and other subsidies, and governmental policies and actions, such as tariffs, executive orders, and other measures, including Executive Order 14421 and the Section 232 Proclamation, on its current and planned capital projects, including project delays, modifications, and cost increases.
Entergy Louisiana’s receivables from the money pool were as follows:
| September 30, 2026 | December 31, 2025 | September 30, 2025 | December 31, 2024 | |||||||||||||||||
| (In Thousands) | ||||||||||||||||||||
| $90,081 | $63,435 | $97,462 | $32,668 | |||||||||||||||||
See Note 4 to the financial statements in the Form 10-K for a description of the money pool.
Entergy Louisiana has a credit facility in the amount of $400 million scheduled to expire in June 2031. The credit facility includes fronting commitments for the issuance of letters of credit against $15 million of the borrowing capacity of the facility. As of September 30, 2026, there were no cash borrowings and no letters of credit outstanding under the credit facility. In addition, Entergy Louisiana is a party to two uncommitted letter of credit
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facilities as a means to post collateral to support its obligations to MISO and for other purposes. As of September 30, 2026, $161.2 million in MISO letters of credit and $20 million in non-MISO letters of credit were outstanding under Entergy Louisiana’s uncommitted letter of credit facilities. See Note 4 to the financial statements herein for additional discussion of the credit facilities.
The Entergy Louisiana nuclear fuel company variable interest entities have two separate credit facilities, each in the amount of $105 million and scheduled to expire in June 2029. As of September 30, 2026, $67.8 million in loans were outstanding under the credit facility for the Entergy Louisiana Waterford nuclear fuel company variable interest entity and $23.8 million in loans were outstanding under the credit facility for the Entergy Louisiana River Bend nuclear fuel company variable interest entity. See Note 4 to the financial statements herein for additional discussion of the nuclear fuel company variable interest entity credit facilities.
Renewables
Cypress Harvest Solar
As discussed in the Form 10-K, in February 2026, Entergy Louisiana filed an application seeking LPSC approval and certification for the Cypress Harvest Solar facility, a 200 MW solar facility to be located in Iberville Parish, Louisiana. In March 2026 the LPSC staff filed an affidavit attesting that the Cypress Harvest Solar facility meets the applicable parameters for Entergy Louisiana’s expedited certification process and recommending that the LPSC grant certification. At its April 2026 meeting, the LPSC voted to grant the requested approval and certification, with a written order issued in May 2026. In July 2026 the Iberville Parish Council adopted a two-year moratorium on battery energy storage system development to allow time for further evaluation of the community impacts of the technology. In response to the battery moratorium, Entergy Louisiana is planning to replace the 200 MW battery planned for the Cypress Harvest Solar facility with a 110 MW battery at the Segno Solar facility and a 90 MW battery at the Votaw Solar facility. In both August and September 2026, the Iberville Parish Council voted to deny the permit for the Cypress Harvest Solar facility. In October 2026, Entergy Louisiana filed a petition for declaratory and injunctive relief in the 18th Judicial District Court for the Parish of Iberville challenging the Iberville Parish Council’s failure to comply with the requirements of its solar farm regulation. Entergy Louisiana is evaluating the effect of these recent actions on the Cypress Harvest Solar facility, including on the facility’s scheduled in service date of 2028. As of September 30, 2026, Entergy Louisiana has incurred approximately $30 million of project costs for the Cypress Harvest Solar facility.
Segno Solar and Votaw Solar
As discussed in the Form 10-K, in December 2025, Entergy Louisiana filed an application with the LPSC seeking approval and certification to construct the Segno Solar facility and Votaw Solar facility. The application asks that the LPSC approve, subject to certain ongoing discussions, allocation of the two facilities to a designated renewable resources subscription to Entergy Louisiana’s Rider Geaux Zero, and further asserts that the two solar resources fall below certain breakeven parameters established in connection with the LPSC’s order allowing Entergy Louisiana to procure up to 3 gigawatts of solar resources, thus supporting that the resources should be certified as being in the public interest. The application requested consideration by the LPSC at or before its August 2026 meeting. A procedural schedule was set with a hearing initially scheduled for July 2026. In June 2026, Entergy Louisiana filed an unopposed motion asking that the procedural schedule be suspended to allow for settlement negotiations. The motion was granted and the procedural schedule was suspended. Based on a contractual right exercised by the developer in September 2026, Entergy must elect during the fourth quarter of 2026 whether to (i) purchase the assets included in the development agreement as they exist as of October 30, 2026 or (ii) waive the right to purchase the assets, remove the project from the MISO interconnection queue, and retain any MISO refund. Entergy Louisiana is in discussions with the developer regarding these options as well as considering other options for the continued development of the Votaw Solar facility. Subject to approval by the LPSC for each facility and resolution of the development issues at the Votaw Solar facility, each facility is expected to be in service by 2029.
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Other Generation and Transmission
Additional Generation and Transmission Resources
See the Form 10-K for discussion of Entergy Louisiana’s October 2024 application with the LPSC seeking approval of a variety of generation and transmission resources proposed in connection with establishing service to a new data center to be developed by a subsidiary of Meta Platforms, Inc. in north Louisiana, for which an electric service agreement was previously executed.
In March 2026, Entergy Louisiana entered into an electric service agreement with Evest LLC (Evest), a subsidiary of Meta Platforms, Inc., in connection with establishing service to a second new data center to be developed by Evest in north Louisiana. The obligations pursuant to the agreement will commence following construction of certain transmission facilities needed to serve Evest, and the effectiveness of the agreement is conditioned upon receipt of required governmental approvals, including approval from the LPSC. Also in March 2026, Entergy Louisiana filed an application with the LPSC for certification to construct seven new combined cycle combustion turbine generation resources totaling 5,278 MW at a total cost of approximately $12.9 billion, each of which will be enabled for future carbon capture and storage, and three battery energy storage systems, including two that were originally proposed to be co-located with solar resources at the Cypress Harvest Solar facility in Iberville Parish and the Bogalusa West Solar facility in Washington Parish. The application also seeks approval to construct a new 500 kV transmission line, from West Fork Creek to St. Landry, estimated to cost $1.4 billion, and other related transmission facilities. In response to a two-year battery moratorium enacted by the Iberville Parish Council in July 2026, Entergy Louisiana is planning to replace the 200 MW battery planned for the Cypress Harvest Solar facility with a 110 MW battery at the Segno Solar facility and a 90 MW battery at the Votaw Solar facility. Four of the new combined cycle combustion turbine generation resources are to be located near the customer site in north Louisiana (Richland Parish Units 1-4), while the remaining three units will be located near the existing Big Cajun site in Pointe Coupee Parish (Pointe Coupee Units 1-3). The seven new combined cycle combustion turbine generation resources have various estimated in-service dates in 2030 and 2031. The application also requests certain approvals related to a corporate sustainability agreement with the new customer. The corporate sustainability agreement contemplates the new customer contributing to the costs of the future addition of 2,500 MW of new renewable and energy storage resources, agreements involving nuclear-related efforts and contributions to bill assistance and other programs for low-income residents. Entergy Louisiana anticipates recovering the incremental cost to serve the customer through direct financial contributions from the customer and the revenues it expects to earn under the electric service agreement. The application is pending before the LPSC. At its April 2026 meeting, the LPSC voted to direct the administrative hearings division to adopt a procedural schedule that would allow for LPSC consideration of the matter at its December 2026 meeting, and also to have the administrative hearings division serve as a hearing examiner and compile a record for the LPSC to consider without the issuance of a formal recommendation from the ALJ. Testimony of the LPSC staff and certain intervenors was filed in July 2026 and cross answering testimony of the LPSC staff and certain intervenors was filed in August 2026. Entergy Louisiana’s rebuttal testimony was filed in September 2026. The hearing in this matter took place in October 2026. Ahead of the hearing, Entergy Louisiana reached a settlement with the LPSC staff and one intervenor. The settlement resolves all outstanding issues among Entergy Louisiana, the LPSC staff, and the intervenor and recommends, among other things, that the LPSC certify the proposed resources. An LPSC decision is expected in December 2026.
The electric service agreement and related contracts contain provisions that protect Entergy Louisiana’s current customers in a manner consistent with the LPSC’s Lightning Initiative and Entergy Louisiana’s Fair Share Plus guidelines, which the LPSC and Entergy Louisiana, respectively, developed in response to increased investment in large data centers in Louisiana. The protections include terms requiring the customer to pay Entergy Louisiana’s incremental costs to serve the customer, including through contributions in aid of construction, other advanced payments and minimum monthly bills. The agreements also include specified financial obligations in the event that Evest terminates the contracts early, restructures the project, or in the event of default. These specified
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financial obligations would be based on Entergy Louisiana’s unrecovered incremental costs to serve Evest at the time of such an event. Evest’s obligations under the electric service agreement and related contracts are secured by various forms of collateral, including a guaranty from Meta Platforms, Inc.
Finally, the electric service agreement also includes provisions relating to Entergy Louisiana’s performance obligations, including the timely construction of the facilities supporting service to Evest, audit rights for the construction costs supported by Evest, and service standards during the term of the electric service agreement. Entergy Louisiana’s failure to meet one or more of these performance obligations could result in specified financial and/or non-financial penalties. Such penalties would vary based on the nature and severity of the failure, including the potential termination of the electric service agreement.
In June 2026 certain intervenors filed a motion requesting that the LPSC issue a subpoena to Meta Platforms, Inc. to obtain certain information about the data center project, including the level of expected investment, job creation, load characteristics, and other aspects of the project, as well as certain financial information. In July 2026, after briefing and argument, the ALJ issued a ruling granting this motion in part and denying it in part. In July 2026, Meta Platforms, Inc. filed a motion to quash the subpoena and a motion for interlocutory review of the ruling that granted the issuance of the subpoena. Meta Platforms, Inc.’s motion for interlocutory review of the ruling was granted by the LPSC at its August 2026 Business and Executive Session. In September 2026 the intervenors seeking the subpoena filed a Petition for Appeal and Judicial Review or in the Alternative Supervisory Writ naming the LPSC as respondent and seeking judicial review of the LPSC’s decision.
Babel - Webre 500 kV Transmission Project
As discussed in the Form 10-K, in December 2025, Entergy Louisiana filed an application with the LPSC seeking a certificate of public convenience and necessity for a 500 kV transmission project that includes the construction of a new 147-mile Babel to Webre 500 kV transmission line, the reconstruction of the Webre 500 kV switching station in Louisiana, and coordination with Entergy Texas on the construction of an approximately 4-mile 500 kV transmission line in Texas. The project was approved by MISO in the 2025 MISO Transmission Expansion Plan and has an estimated cost of $1,238 million and an estimated in-service date of August 2029. In May 2026 the LPSC staff and the Southern Renewable Energy Association (SREA), an intervenor, filed direct testimony. The LPSC staff’s testimony and SREA’s testimony recommended that the LPSC find the project to be in the public interest and grant certification under the LPSC’s general order on transmission siting. The parties entered into an uncontested stipulated settlement agreement and participated in a settlement hearing in September 2026. The LPSC voted to accept the settlement and approve the project at its October 2026 Business and Executive Session.
Waterford 6 Power Station and Westlake Power Station
As discussed in the Form 10-K, in February 2026, Entergy Louisiana filed an application seeking LPSC approval and certification to construct two 754 MW combined cycle combustion turbine generators, the Waterford 6 Power Station and the Westlake Power Station, to be located at Entergy Louisiana’s existing Waterford site near Killona, Louisiana and existing Roy S. Nelson site in Westlake, Louisiana, respectively. In its application, Entergy Louisiana noted the estimated costs are approximately $2,027 million for the Waterford 6 Power Station and $2,091 million for the Westlake Power Station. The LPSC staff and intervenors in the proceeding filed direct testimony in July 2026. The LPSC staff’s testimony expressed support for the LPSC’s approval of Entergy Louisiana’s proposed new generation projects subject to certain conditions. Certain intervenors oppose such approval. Entergy Louisiana filed rebuttal testimony in September 2026. In October 2026, Entergy Louisiana entered into a third-party financing arrangement for the Waterford 6 Power Station. A hearing was held in October 2026. An LPSC decision is expected in first quarter 2027. Subject to timely approval by the LPSC and receipt of other permits and approvals, the estimated in-service dates for the Waterford 6 Power Station and Westlake Power Station are July 2030 and October 2030, respectively. See Note 1 to the financial statements herein for discussion of the build-to-suit lease arrangement for the Waterford 6 Power Station.
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Management’s Financial Discussion and Analysis
Cottonwood Power Station
As discussed in the Form 10-K, in December 2025, Entergy Louisiana filed an application seeking LPSC approval and a certificate of convenience and necessity to acquire the Cottonwood combined cycle combustion turbine facility, a 1,263 MW combined cycle facility in Deweyville, Texas that was originally placed in commercial service in 2003. The filing seeks findings from the LPSC that the costs of the acquisition, including the approximately $1.5 billion purchase price and $309.3 million in capital upgrades and maintenance items needed to bring the Cottonwood facility into alignment with Entergy Louisiana’s fleet standards with respect to operations and safety, are eligible for recovery in customer rates. In June 2026 the LPSC staff filed direct testimony raising various concerns and objections to the proposed transaction as presented in Entergy Louisiana’s application. The LPSC staff asserts that the need for the Cottonwood facility is driven predominantly by loads associated with certain large data center projects and opines that the costs and future operational risks of the Cottonwood facility should be borne by these customers in particular, not Entergy Louisiana’s customers generally. The LPSC staff’s direct testimony also raises issues regarding the acquisition premium, potential stranded costs, and future operating risks associated with the Cottonwood facility. Discovery is ongoing, and Entergy Louisiana filed rebuttal testimony in July 2026. A hearing is scheduled for February 2027. The acquisition is currently targeted to close in the first or second quarter of 2027, subject to regulatory approvals and other conditions to closing.
Build-to-Suit Lease Arrangement for the Waterford 6 Power Station
In October 2026, Entergy Louisiana entered a build-to-suit lease arrangement for the Waterford 6 Power Station as the lessee with a consortium of investors (the Investors). Under the terms of the arrangement, the Investors purchased the in-process Waterford 6 Power Station construction project from Entergy Louisiana at a cost of $167.5 million and will spend up to $1.875 billion (including the initial purchase price) to construct the Waterford 6 project as designed by Entergy Louisiana. Entergy Louisiana is engaged to serve as the construction agent for the Waterford 6 Power Station project. The Investors, however, control the asset during construction. If Entergy Louisiana defaults in its role as construction agent, the Investors have various options available to remedy the default, including the replacement of Entergy Louisiana as construction agent, the acceleration of the lease balance payable by Entergy Louisiana, causing a sale of the Waterford 6 Power Station project to a third party, and certain other options. If the LPSC rejects the Waterford 6 Power Station project or certain other circumstances occur that are outside of Entergy Louisiana’s control, then either the Investors or Entergy Louisiana could exercise the right to terminate the arrangement, in which case Entergy Louisiana would be required to purchase the in-process Waterford 6 Power Station project from the Investors at an amount equal to their costs incurred to date, including carrying costs. Because Entergy Louisiana does not control the in-process construction project, it will not recognize the asset (i.e., construction work in progress) or an associated liability during construction.
Upon the Waterford 6 Power Station’s readiness for first synchronization to the grid, expected in late 2029, a triple-net lease will commence under which Entergy Louisiana will have control of the Waterford 6 Power Station and receive all output from the plant. The initial term of the lease will end seven years from the closing of the arrangement, or approximately four years after the Waterford 6 Power Station’s expected readiness for first synchronization to the grid. The lease cost will be equal to the Secured Overnight Financing Rate plus a margin which is based on the credit rating of Entergy Louisiana, multiplied by the total costs (including carrying costs) incurred by the Investors as of the commencement of the lease. Entergy Louisiana will have the option to purchase the Waterford 6 Power Station at any time during the lease term at a price equal to the total cost of the plant to the Investors, plus any fees and carrying charges owed to the Investors. If the purchase price option is exercised within two years of commencement of the triple-net lease, Entergy Louisiana must enter into a secured note payable to the Investors for the amount of the purchase price. The note payable would be due at the end of the initial lease term, but may be prepaid at any time beginning two years after the commencement date of the lease. The note will be secured by the Waterford 6 Power Station and related equipment and collateral.
At the end of the initial lease term, Entergy Louisiana must exercise one of the following options: (1) renew the lease for an additional five year term, subject to unanimous consent of the Investors; (2) purchase the plant at a
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price equal to the total cost of the plant to Investors, plus any fees and carrying charges owed to the Investors; or (3) sell the plant on behalf of the Investors. If Entergy Louisiana chooses the third option, then it will owe or be owed any difference between the total cost of the plant to Investors and the sale price.
State and Local Rate Regulation and Fuel-Cost Recovery
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS – State and Local Rate Regulation and Fuel Cost Recovery” in the Form 10-K for a discussion of state and local rate regulation and fuel-cost recovery. The following are updates to that discussion.
Retail Rates
Resilience Plan Cost Recovery Rider
In December 2022, Entergy Louisiana filed an application with the LPSC seeking a public interest finding regarding Phase I of Entergy Louisiana’s Future Ready resilience plan and approval of a rider mechanism to recover the program’s costs. Phase I in the December 2022 application reflected the first five years of a ten-year resilience plan and included investment of approximately $5 billion, including hardening investment, transmission dead-end structures, enhanced vegetation management, and telecommunications improvement. In April 2024 the LPSC approved a framework which includes an initial five-year resilience plan providing for an investment of approximately $1.9 billion with cost recovery via a forward-looking rider with semi-annual true-ups. The plan is subject to specified reporting requirements and includes a performance review of the hardened assets. The LPSC order approving the framework does not include any restrictions on Entergy Louisiana’s ability to file applications for approval of additional investments in resilience.
In January 2025, Entergy Louisiana’s semi-annual filing sought to collect from Entergy Louisiana’s retail customers approximately $40.4 million, or $38.9 million in incremental annual revenues from Entergy Louisiana’s first semi-annual filing in July 2024, for projects expected to be placed in service during the rate-effective period of March 2025 through August 2025. In February 2025 the LPSC staff reviewed the filed rider rates and identified no material issues.
In July 2025, Entergy Louisiana’s semi-annual filing sought to collect from Entergy Louisiana’s retail customers approximately $50.2 million, or $9.8 million in incremental annual revenues, for projects expected to be placed in service during the rate-effective period of September 2025 through February 2026. Additionally, Entergy Louisiana’s true-up filing included an under-recovery totaling $5.6 million to be implemented in the January 2026 semi-annual filing. In August 2025 the LPSC staff reviewed the filed rider rates and identified no material issues.
In January 2026, Entergy Louisiana’s semi-annual filing sought to collect from Entergy Louisiana’s retail customers approximately $101.8 million, or $51.6 million in incremental annual revenues, for projects expected to be placed in service during the rate-effective period of March 2026 through August 2026. Additionally, Entergy Louisiana’s true-up filing included an over-recovery totaling $16.6 million to be implemented in the July 2026 semi-annual filing. In February 2026 the LPSC staff reviewed the filed rider rates and identified no material issues.
In July 2026, Entergy Louisiana’s semi-annual filing sought to collect from Entergy Louisiana’s retail customers approximately $114.2 million, or $12.4 million in incremental annual revenues, for projects expected to be placed in service during the rate-effective period of September 2026 through February 2027. Additionally, Entergy Louisiana’s true-up filing included an under-recovery totaling $2.5 million to be implemented in the January 2027 semi-annual filing. In August 2026 the LPSC staff reviewed the filed rider rates and identified no material issues.
In September 2026, Entergy Louisiana filed an application for the LPSC’s approval of Phase IA of Entergy Louisiana’s Future Ready resilience plan, which consists of additional distribution and transmission hardening
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projects representing approximately $600 million of investment to be completed over the period 2027 to 2030. The application seeks LPSC approval to extend the previously-approved Phase I of Entergy Louisiana’s Future Ready resilience plan with these additional projects to further improve the resilience of Entergy Louisiana’s electric system and further seeks approval to continue to use the resilience plan cost recovery rider to recover the costs of the plan from customers. The primary purpose of Phase IA is to serve as a bridge between Phase I, which is currently expected to conclude by 2028, and a Phase II plan, which Entergy Louisiana expects to develop in accordance with guidance from the LPSC that is expected to be issued in the LPSC’s ongoing resiliency rulemaking docket. Discovery is ongoing. In October 2026 a procedural schedule was established that provides for a hearing in June 2027. Entergy Louisiana has requested an LPSC decision by July 2027.
Vegetation Management Rider
In November 2025 the LPSC staff issued notice of its initiation of a rulemaking to implement a vegetation management pilot program for LPSC jurisdictional electric utilities. The pilot program would be voluntary and would allow utilities to establish a rider for distribution vegetation management for up to 100% of the utility’s prior calendar year vegetation management spending. The rider may not exceed 1% of a customer’s bill, and the utility would be required to maintain its prior calendar year level of spending on vegetation management as reflected in its base rates or formula rate plan. In February 2026 the LPSC staff filed a report and recommendation along with a proposed final rule providing for the adoption of the pilot program consistent with the terms outlined in the original notice. In March 2026 the LPSC voted to accept the LPSC staff’s recommendation and adopt the proposed pilot program as presented. In April 2026, Entergy Louisiana filed its vegetation management rider for the rate-effective period of May 2026 through December 2026, which included a revenue requirement of $20 million for incremental spending on distribution vegetation management above the prior calendar year level of spending on vegetation management.
2025 Formula Rate Plan Filing
In June 2026, Entergy Louisiana filed its formula rate plan evaluation report for its 2025 calendar year operations. Consistent with the global stipulated settlement agreement approved by the LPSC in August 2024, the filing reflected a 9.7% allowed return on common equity with a bandwidth of 40 basis points above and below the midpoint. For the test year 2025, the formula produced an earned return on equity of 9.63%, which falls within the established bandwidth and therefore results in no adjustment to base rider formula rate plan revenue.
Additional changes in formula rate plan revenue include: (1) the removal of approximately $73 million in annual customer credits associated with the global stipulated settlement agreement, which have been fully credited to customers in accordance with the agreement; (2) a reduction in customer credits through the tax adjustment mechanism, attributable to the return of Entergy Louisiana’s over-collection of income tax expense associated with Louisiana state tax law changes effective in 2025 and the expiration of certain ad valorem exemptions; (3) increases in transmission and distribution plant in service, as recognized through the transmission and distribution recovery mechanisms, including restoration costs from Winter Storm Fern, for which Entergy Louisiana does not intend to seek relief or exception to the formula rate plan; (4) increases to the additional capacity mechanism; and (5) the final phase-in of additional nuclear depreciation expense, in accordance with the global stipulated settlement agreement. See Note 2 to the financial statements in the Form 10-K for discussion of the global stipulated settlement agreement. Collectively, these factors contributed to a net increase of $222 million in formula rate plan revenue for the period. In August 2026 the LPSC staff filed its errors and objections report. The report did not identify any specific errors, objections, or adjustments. However, the LPSC staff reserved its rights with respect to three issues pending further review: (1) the allocation between Entergy Louisiana and Entergy Texas of River Bend’s undepreciated plant balances, costs, and related liabilities; (2) certain projects included in the transmission recovery mechanism filing; and (3) the use of a blended retail/FERC depreciation rate for River Bend depreciation expense. Subject to LPSC review, the resulting changes from the 2025 formula rate plan evaluation report became effective for bills rendered during the first billing cycle of September 2026, subject to refund.
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Management’s Financial Discussion and Analysis
Request for Extension of Formula Rate Plan
In June 2026, Entergy Louisiana submitted a motion requesting the LPSC approve a one-year extension of its current formula rate plan, with all material provisions left unchanged, including the allowed return on common equity of 9.7% with a bandwidth of 40 basis points above and below the midpoint. LPSC action on the proposed extension is expected by November 2026.
River Bend Deregulated Asset Plan Filing
In September 2025, Entergy Louisiana filed an application seeking LPSC approval to recover from customers, prospectively, approximately $49 million in annual revenues associated with the Louisiana retail deregulated portion of River Bend. Costs associated with the deregulated portion of River Bend have historically been excluded from retail ratemaking as a result of a 1988 LPSC decision. Instead, Entergy Louisiana has been allowed by the LPSC to either recover 4.6 cents per kWh for the power generated from that portion of the plant, or sell the power into the applicable market (subject to certain restrictions). The filing presents evidence that River Bend is a cost-effective and prudent source of needed baseload supply with value to Entergy Louisiana customers and seeks to recover the previously excluded costs, on a prospective basis. In March 2026 the LPSC staff and certain intervenors filed direct testimony recommending that the LPSC deny Entergy Louisiana’s application. The LPSC staff’s testimony further recommends that, if the LPSC were to grant any relief, notwithstanding the LPSC staff’s recommendation, such relief should be limited to allowing only prospective capital additions at River Bend to be included in Entergy Louisiana’s customer rates. Entergy Louisiana filed rebuttal testimony in August 2026. In October 2026, Entergy Louisiana filed a motion requesting to suspend all remaining procedural deadlines without date, noting the significant number of dockets currently pending before the LPSC, including many initiated by Entergy Louisiana, and the need for thorough review of these matters. In October 2026 the presiding ALJ issued an order granting the motion and suspending the procedural schedule, including continuing the hearing in the matter without date.
Fuel and purchased power cost recovery
As discussed in the Form 10-K, in March 2020 the LPSC staff provided notice of an audit of Entergy Louisiana’s fuel adjustment clause filings. The audit includes a review of the reasonableness of charges flowed through Entergy Louisiana’s fuel adjustment clause for the period from 2016 through 2019. The LPSC staff issued its audit report in September 2021, and although certain internal record keeping recommendations were made, the LPSC staff did not recommend any disallowances. In October 2026 the LPSC staff and Entergy Louisiana filed a joint audit report addressing the issues identified in the LPSC staff’s September 2021 audit report and stating that there were no unresolved issues. The LPSC voted to approve the joint audit report at its October 2026 Business and Executive Session.
As discussed in the Form 10-K, in June 2025 the LPSC staff provided notice of an audit of Entergy Louisiana’s purchased gas adjustment clause filings (for Entergy Louisiana’s gas operations). The audit includes a review of the reasonableness of charges flowed through Entergy Louisiana’s purchased gas adjustment clause for the period from January 2023 through June 2025. The LPSC staff issued its audit report in March 2026. In October 2026 the LPSC staff and Entergy Louisiana filed a joint audit report. The joint audit report noted that an issue identified in its March 2026 report had been addressed and that, as a result, there were no outstanding unresolved issues. The joint audit report recommended and requested that an LPSC order be issued finding that all costs included in Entergy Louisiana’s purchased gas adjustment filings in the audit period were reasonable, prudent, and necessary and in compliance with applicable LPSC orders, and thus were appropriately eligible for recovery from customers. The LPSC voted to approve the joint audit report at its October 2026 Business and Executive Session.
In February 2026, Entergy Louisiana, in its monthly filing to update its fuel adjustment clause, requested to defer approximately $141.9 million of fuel costs incurred in January 2026 that were primarily attributable to the effects of Winter Storm Fern, consistent with the LPSC’s general order approved at its February 2026 meeting
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permitting temporary modifications to the LPSC’s fuel adjustment clause general order. The filing proposed to defer the recovery of these fuel costs over a four-month period from March 2026 through June 2026 to mitigate the customer bill impacts of these fuel costs. In March 2026 the LPSC issued a special order delegating authority to the LPSC executive secretary to review and approve utility-specific requests for deferral of fuel costs from Winter Storm Fern, subject to audit as per the LPSC’s fuel clause general order. In April 2026 the LPSC executive secretary approved Entergy Louisiana’s request for deferral.
In April 2026 the LPSC staff provided notice of an audit of Entergy Louisiana’s fuel adjustment clause filings. The audit includes a review of the reasonableness of charges flowed through Entergy Louisiana’s fuel adjustment clause for the period from 2023 through 2025. Discovery is ongoing, and no audit report has been filed.
Industrial and Commercial Customers
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS – Industrial and Commercial Customers” in the Form 10-K for a discussion of industrial and commercial customers.
Federal Regulation
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS – Federal Regulation” in the Form 10-K and Note 2 to the financial statements herein and in the Form 10-K for a discussion of federal regulation.
Nuclear Matters
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS – Nuclear Matters” in the Form 10-K for a discussion of nuclear matters. The following is an update to that discussion.
NRC Reactor Oversight Process
The NRC’s Reactor Oversight Process is a program to collect information about plant performance, assess the information for its safety significance, and provide for appropriate licensee and NRC response. The NRC evaluates plant performance by analyzing two distinct inputs: inspection findings resulting from the NRC’s inspection program and performance indicators reported by the licensee. The evaluations result in the placement of each plant in one of the NRC’s Reactor Oversight Process Action Matrix columns: “licensee response column,” or Column 1, “regulatory response column,” or Column 2, “degraded cornerstone column,” or Column 3, “multiple/repetitive degraded cornerstone column,” or Column 4, and “unacceptable performance,” or Column 5. Plants in Column 1 are subject to normal NRC inspection activities. Plants in Column 2, Column 3, or Column 4 are subject to progressively increasing levels of inspection by the NRC with, in general, progressively increasing levels of associated costs. Continued plant operation is not permitted for plants in Column 5. Waterford 3 is currently in Column 1, and River Bend is currently in Column 2.
In August 2026 the NRC issued a final significance determination and notice of violation for River Bend, in which it finalized a “white” finding with “low safety significance” related to one of the service water pumps at River Bend, resulting in River Bend’s placement in Column 2, effective third quarter 2026. River Bend will remain in Column 2 until the satisfactory completion of an NRC supplemental inspection.
Environmental Risks
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Environmental Risks” in the Form 10-K for a discussion of environmental risks.
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Critical Accounting Estimates
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Critical Accounting Estimates” in the Form 10-K for a discussion of the estimates and judgments necessary in Entergy Louisiana’s accounting for nuclear decommissioning costs, utility regulatory accounting, taxation and uncertain tax positions, qualified pension and other postretirement benefits, and other contingencies.
New Accounting Pronouncements
See the “New Accounting Pronouncements” section of Note 1 to the financial statements in the Form 10-K for a discussion of new accounting pronouncements and the “New Accounting Pronouncements” section of Entergy Corporation and Subsidiaries Management’s Financial Discussion and Analysis herein for updates to the discussion of new accounting pronouncements.
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| ENTERGY LOUISIANA, LLC AND SUBSIDIARIES | ||||||||||||||||||||||||||
| CONSOLIDATED INCOME STATEMENTS | ||||||||||||||||||||||||||
| For the Three and Nine Months Ended September 30, 2026 and 2025 | ||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||
| (In Thousands) | (In Thousands) | |||||||||||||||||||||||||
| OPERATING REVENUES | ||||||||||||||||||||||||||
| Electric | $ | $ | $ | $ | ||||||||||||||||||||||
| Natural gas | ||||||||||||||||||||||||||
| TOTAL | ||||||||||||||||||||||||||
| OPERATING EXPENSES | ||||||||||||||||||||||||||
| Operation and Maintenance: | ||||||||||||||||||||||||||
| Fuel, fuel-related expenses, and gas purchased for resale | ||||||||||||||||||||||||||
| Purchased power | ||||||||||||||||||||||||||
| Nuclear refueling outage expenses | ||||||||||||||||||||||||||
| Other operation and maintenance | ||||||||||||||||||||||||||
| Decommissioning | ||||||||||||||||||||||||||
| Taxes other than income taxes | ||||||||||||||||||||||||||
| Depreciation and amortization | ||||||||||||||||||||||||||
| Other regulatory charges (credits) - net | ( | ( | ( | ( | ||||||||||||||||||||||
| TOTAL | ||||||||||||||||||||||||||
| OPERATING INCOME | ||||||||||||||||||||||||||
| OTHER INCOME | ||||||||||||||||||||||||||
| Allowance for equity funds used during construction | ||||||||||||||||||||||||||
| Interest and investment income | ||||||||||||||||||||||||||
| Interest and investment income - affiliated | ||||||||||||||||||||||||||
| Miscellaneous - net | ( | ( | ( | |||||||||||||||||||||||
| TOTAL | ||||||||||||||||||||||||||
| INTEREST EXPENSE | ||||||||||||||||||||||||||
| Interest expense | ||||||||||||||||||||||||||
| Allowance for borrowed funds used during construction | ( | ( | ( | ( | ||||||||||||||||||||||
| TOTAL | ||||||||||||||||||||||||||
| INCOME BEFORE INCOME TAXES | ||||||||||||||||||||||||||
| Income taxes | ||||||||||||||||||||||||||
| NET INCOME | ||||||||||||||||||||||||||
| Net income attributable to noncontrolling interests | ||||||||||||||||||||||||||
| EARNINGS APPLICABLE TO MEMBER'S EQUITY | $ | $ | $ | $ | ||||||||||||||||||||||
| See Notes to Financial Statements. | ||||||||||||||||||||||||||
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| ENTERGY LOUISIANA, LLC AND SUBSIDIARIES | |||||||||||||||||||||||
| CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||||||||||||||||||||||
| For the Three and Nine Months Ended September 30, 2026 and 2025 | |||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| (In Thousands) | (In Thousands) | ||||||||||||||||||||||
| Net Income | $ | $ | $ | $ | |||||||||||||||||||
| Other comprehensive loss | |||||||||||||||||||||||
Pension and other postretirement plan changes (net of tax benefit of $ | ( | ( | ( | ( | |||||||||||||||||||
| Other comprehensive loss | ( | ( | ( | ( | |||||||||||||||||||
| Comprehensive Income | |||||||||||||||||||||||
| Net income attributable to noncontrolling interests | |||||||||||||||||||||||
| Comprehensive Income Applicable to Member’s Equity | $ | $ | $ | $ | |||||||||||||||||||
| See Notes to Financial Statements. | |||||||||||||||||||||||
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| ENTERGY LOUISIANA, LLC AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||
| For the Nine Months Ended September 30, 2026 and 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| OPERATING ACTIVITIES | ||||||||||||||
| Net income | $ | $ | ||||||||||||
| Adjustments to reconcile net income to net cash flow provided by operating activities: | ||||||||||||||
| Depreciation, amortization, and decommissioning, including nuclear fuel amortization | ||||||||||||||
| Deferred income taxes, tax credits, and non-current taxes accrued | ||||||||||||||
| Changes in working capital: | ||||||||||||||
| Receivables | ( | ( | ||||||||||||
| Fuel inventory | ||||||||||||||
| Accounts payable | ||||||||||||||
| Taxes accrued | ||||||||||||||
| Interest accrued | ( | ( | ||||||||||||
| Deferred fuel costs | ||||||||||||||
| Customer advances - current | ||||||||||||||
| Other working capital accounts | ( | ( | ||||||||||||
| Changes in provisions for estimated losses | ( | |||||||||||||
| Changes in other regulatory assets | ( | |||||||||||||
| Changes in other regulatory liabilities | ( | ( | ||||||||||||
| Changes in pension and other postretirement funded status | ( | ( | ||||||||||||
| Other | ( | ( | ||||||||||||
| Net cash flow provided by operating activities | ||||||||||||||
| INVESTING ACTIVITIES | ||||||||||||||
| Construction expenditures | ( | ( | ||||||||||||
| Allowance for equity funds used during construction | ||||||||||||||
| Payment for purchase of assets | ( | |||||||||||||
| Proceeds from sale of business and assets | ||||||||||||||
| Nuclear fuel purchases | ( | ( | ||||||||||||
| Proceeds from sale of nuclear fuel | ||||||||||||||
| Payments to storm reserve escrow account | ( | ( | ||||||||||||
| Receipt from storm reserve escrow account | ||||||||||||||
| Redemption of preferred membership interests of affiliate | ||||||||||||||
| Proceeds from nuclear decommissioning trust fund sales | ||||||||||||||
| Investment in nuclear decommissioning trust funds | ( | ( | ||||||||||||
| Changes in money pool receivable - net | ( | ( | ||||||||||||
| Insurance proceeds received for property damages | ||||||||||||||
| Decrease (increase) in other investments | ( | |||||||||||||
| Net cash flow used in investing activities | ( | ( | ||||||||||||
| FINANCING ACTIVITIES | ||||||||||||||
| Proceeds from the issuance of long-term debt | ||||||||||||||
| Retirement of long-term debt | ( | ( | ||||||||||||
| Customer advances received for construction | ||||||||||||||
| Customer advances used for construction | ( | ( | ||||||||||||
| Common equity distributions paid | ( | |||||||||||||
| Other | ( | ( | ||||||||||||
| Net cash flow provided by financing activities | ||||||||||||||
| Net increase in cash and cash equivalents | ||||||||||||||
| Cash and cash equivalents at beginning of period | ||||||||||||||
| Cash and cash equivalents at end of period | $ | $ | ||||||||||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||||||||||||||
| Cash paid (received) during the period for: | ||||||||||||||
| Interest - net of amount capitalized | $ | $ | ||||||||||||
Income taxes - net (includes proceeds from the transfer of production tax credits to third parties of $55,810 in 2026 and $146,355 in 2025) | ($ | ($ | ||||||||||||
| Noncash investing activities: | ||||||||||||||
| Accrued construction expenditures | $ | $ | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| ENTERGY LOUISIANA, LLC AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||||||||
| ASSETS | ||||||||||||||
| September 30, 2026 and December 31, 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| CURRENT ASSETS | ||||||||||||||
| Cash and cash equivalents: | ||||||||||||||
| Cash | $ | $ | ||||||||||||
| Temporary cash investments | ||||||||||||||
| Total cash and cash equivalents | ||||||||||||||
| Accounts receivable: | ||||||||||||||
| Customer | ||||||||||||||
| Allowance for doubtful accounts | ( | ( | ||||||||||||
| Associated companies | ||||||||||||||
| Other | ||||||||||||||
| Accrued unbilled revenues | ||||||||||||||
| Total accounts receivable | ||||||||||||||
| Deferred fuel costs | ||||||||||||||
| Fuel inventory - at average cost | ||||||||||||||
| Materials and supplies | ||||||||||||||
| Deferred nuclear refueling outage costs | ||||||||||||||
| Prepayments and other | ||||||||||||||
| TOTAL | ||||||||||||||
| OTHER PROPERTY AND INVESTMENTS | ||||||||||||||
| Investment in affiliate preferred membership interests | ||||||||||||||
| Decommissioning trust funds | ||||||||||||||
| Non-utility property - at cost (less accumulated depreciation) | ||||||||||||||
| Storm reserve escrow account | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| UTILITY PLANT | ||||||||||||||
| Electric | ||||||||||||||
| Construction work in progress | ||||||||||||||
| Nuclear fuel | ||||||||||||||
| TOTAL UTILITY PLANT | ||||||||||||||
| Less - accumulated depreciation and amortization | ||||||||||||||
| UTILITY PLANT - NET | ||||||||||||||
| DEFERRED DEBITS AND OTHER ASSETS | ||||||||||||||
| Regulatory assets: | ||||||||||||||
| Other regulatory assets | ||||||||||||||
| Deferred fuel costs | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| TOTAL ASSETS | $ | $ | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| CONSOLIDATED BALANCE SHEETS | ||||||||||||||
| LIABILITIES AND EQUITY | ||||||||||||||
| September 30, 2026 and December 31, 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| CURRENT LIABILITIES | ||||||||||||||
| Currently maturing long-term debt | $ | $ | ||||||||||||
| Accounts payable: | ||||||||||||||
| Associated companies | ||||||||||||||
| Other | ||||||||||||||
| Customer deposits | ||||||||||||||
| Taxes accrued | ||||||||||||||
| Interest accrued | ||||||||||||||
| Deferred fuel costs | ||||||||||||||
| Customer advances | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| NON-CURRENT LIABILITIES | ||||||||||||||
| Accumulated deferred income taxes and taxes accrued | ||||||||||||||
| Accumulated deferred investment tax credits | ||||||||||||||
| Regulatory liability for income taxes - net | ||||||||||||||
| Other regulatory liabilities | ||||||||||||||
| Decommissioning | ||||||||||||||
| Accumulated provisions | ||||||||||||||
| Pension and other postretirement liabilities | ||||||||||||||
| Long-term debt | ||||||||||||||
| Customer advances for construction | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| Commitments and Contingencies | ||||||||||||||
| EQUITY | ||||||||||||||
| Member’s equity | ||||||||||||||
| Accumulated other comprehensive income | ||||||||||||||
| Noncontrolling interests | ||||||||||||||
| TOTAL | ||||||||||||||
| TOTAL LIABILITIES AND EQUITY | $ | $ | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY | |||||||||||||||||||||||
| For the Nine Months Ended September 30, 2026 and 2025 | |||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||
| Noncontrolling Interests | Member’s Equity | Accumulated Other Comprehensive Income | Total | ||||||||||||||||||||
(In Thousands) | |||||||||||||||||||||||
| Balance at December 31, 2024 | $ | $ | $ | $ | |||||||||||||||||||
| Net income | — | ||||||||||||||||||||||
| Other comprehensive loss | — | — | ( | ( | |||||||||||||||||||
| Common equity distributions | — | ( | — | ( | |||||||||||||||||||
| Distributions to LURC | ( | — | — | ( | |||||||||||||||||||
| Other | — | ( | — | ( | |||||||||||||||||||
| Balance at March 31, 2025 | |||||||||||||||||||||||
| Net income | — | ||||||||||||||||||||||
| Other comprehensive loss | — | — | ( | ( | |||||||||||||||||||
| Common equity distributions | — | ( | — | ( | |||||||||||||||||||
| Distributions to LURC | ( | — | — | ( | |||||||||||||||||||
| Other | — | ( | — | ( | |||||||||||||||||||
| Balance at June 30, 2025 | |||||||||||||||||||||||
| Net income | — | ||||||||||||||||||||||
| Other comprehensive loss | — | — | ( | ( | |||||||||||||||||||
| Common equity distributions | — | ( | — | ( | |||||||||||||||||||
| Distributions to LURC | ( | — | — | ( | |||||||||||||||||||
| Other | — | ( | — | ( | |||||||||||||||||||
| Balance at September 30, 2025 | $ | $ | $ | $ | |||||||||||||||||||
| Balance at December 31, 2025 | $ | $ | $ | $ | |||||||||||||||||||
| Net income | — | ||||||||||||||||||||||
| Other comprehensive loss | — | — | ( | ( | |||||||||||||||||||
| Distributions to LURC | ( | — | — | ( | |||||||||||||||||||
| Other | — | ( | — | ( | |||||||||||||||||||
| Balance at March 31, 2026 | |||||||||||||||||||||||
| Net income | — | ||||||||||||||||||||||
| Other comprehensive loss | — | — | ( | ( | |||||||||||||||||||
| Distributions to LURC | ( | — | — | ( | |||||||||||||||||||
| Other | — | ( | — | ( | |||||||||||||||||||
| Balance at June 30, 2026 | |||||||||||||||||||||||
| Net income | — | ||||||||||||||||||||||
| Other comprehensive loss | — | — | ( | ( | |||||||||||||||||||
| Distributions to LURC | ( | — | — | ( | |||||||||||||||||||
| Other | — | ( | — | ( | |||||||||||||||||||
| Balance at September 30, 2026 | $ | $ | $ | $ | |||||||||||||||||||
| See Notes to Financial Statements. | |||||||||||||||||||||||
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MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS
Results of Operations
Net Income
Third Quarter 2026 Compared to Third Quarter 2025
Net income increased $26.6 million primarily due to higher volume/weather, higher retail electric price, and higher revenues resulting from the return on construction work in progress for certain utility plant investments. The increase was partially offset by $15 million of liquidated damages recognized in third quarter 2025 resulting from a counterparty’s termination of a purchased power agreement, higher other operation and maintenance expenses, and higher interest expense.
Nine Months Ended September 30, 2026 Compared to Nine Months Ended September 30, 2025
Net income increased $83.9 million primarily due to higher retail electric price, higher revenues resulting from the return on construction work in progress for certain utility plant investments, higher volume/weather, a regulatory charge, recorded in first quarter 2025, to reflect an adjustment to the grid modernization over/under recovery deferral balance, and higher other income. The increase was partially offset by higher interest expense, higher other operation and maintenance expenses, and $15 million of liquidated damages recognized in third quarter 2025 resulting from a counterparty’s termination of a purchased power agreement.
Operating Revenues
Third Quarter 2026 Compared to Third Quarter 2025
Following is an analysis of the change in operating revenues comparing the third quarter 2026 to the third quarter 2025:
| Amount | |||||
| (In Millions) | |||||
| 2025 operating revenues | $577.1 | ||||
| Fuel, rider, and other revenues that do not significantly affect net income | 97.1 | ||||
| Volume/weather | 26.7 | ||||
| Retail electric price | 22.3 | ||||
| Return on construction work in progress for certain utility plant investments | 17.2 | ||||
| Purchased power agreement termination proceeds | (15.0) | ||||
| 2026 operating revenues | $725.4 | ||||
Entergy Mississippi’s results include revenues from rate mechanisms designed to recover fuel, purchased power, and other costs such that the revenues and expenses associated with these items generally offset and do not affect net income. “Fuel, rider, and other revenues that do not significantly affect net income” includes the revenue variance associated with these items.
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The volume/weather variance is primarily due to the effect of favorable weather on residential and commercial sales and an increase in industrial usage. The increase in industrial usage is primarily due to an increase in demand from large industrial customers, primarily data center customers.
The retail electric price variance is primarily due to an increase in formula rate plan rates resulting from an increase in interim facilities rate adjustment revenues effective January 2026. See Note 2 to the financial statements in the Form 10-K for discussion of the interim facilities rate adjustment filing.
The return on construction work in progress for certain utility plant investments variance represents the revenue related to the amortization of certain customer advances designed to provide a return on investment in construction work in progress for certain utility plant investments, which is recognized as the related construction costs are incurred.
The purchased power agreement termination proceeds variance represents $15 million of liquidated damages recognized in third quarter 2025 resulting from a counterparty’s termination of a purchased power agreement.
Total electric energy sales for Entergy Mississippi for the three months ended September 30, 2026 and 2025 are as follows:
| 2026 | 2025 | % Change | |||||||||||||||
| (GWh) | |||||||||||||||||
| Residential | 2,057 | 1,810 | 14 | ||||||||||||||
| Commercial | 1,483 | 1,394 | 6 | ||||||||||||||
| Industrial | 1,158 | 743 | 56 | ||||||||||||||
| Governmental | 117 | 116 | 1 | ||||||||||||||
| Total retail | 4,815 | 4,063 | 19 | ||||||||||||||
| Sales for resale: | |||||||||||||||||
| Non-associated companies | 1,659 | 1,605 | 3 | ||||||||||||||
| Total | 6,474 | 5,668 | 14 | ||||||||||||||
See Note 12 to the financial statements herein for additional discussion of Entergy Mississippi’s operating revenues.
Nine Months Ended September 30, 2026 Compared to Nine Months Ended September 30, 2025
Following is an analysis of the change in operating revenues comparing the nine months ended September 30, 2026 to the nine months ended September 30, 2025:
| Amount | |||||
| (In Millions) | |||||
| 2025 operating revenues | $1,492.7 | ||||
| Fuel, rider, and other revenues that do not significantly affect net income | 202.0 | ||||
| Retail electric price | 50.5 | ||||
| Return on construction work in progress for certain utility plant investments | 44.1 | ||||
| Volume/weather | 34.4 | ||||
| Purchased power agreement termination proceeds | (15.0) | ||||
| 2026 operating revenues | $1,808.7 | ||||
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Entergy Mississippi’s results include revenues from rate mechanisms designed to recover fuel, purchased power, and other costs such that the revenues and expenses associated with these items generally offset and do not affect net income. “Fuel, rider, and other revenues that do not significantly affect net income” includes the revenue variance associated with these items.
The retail electric price variance is primarily due to an increase in formula rate plan rates resulting from an increase in interim facilities rate adjustment revenues effective January 2026. See Note 2 to the financial statements in the Form 10-K for discussion of the interim facilities rate adjustment filing.
The return on construction work in progress for certain utility plant investments variance represents the revenue related to the amortization of certain customer advances designed to provide a return on investment in construction work in progress for certain utility plant investments, which is recognized as the related construction costs are incurred.
The volume/weather variance is primarily due to increases in industrial, residential, and commercial usage. The increase in industrial usage is primarily due to an increase in demand from large industrial customers, primarily data center customers.
The purchased power agreement termination proceeds variance represents $15 million of liquidated damages recognized in third quarter 2025 resulting from a counterparty’s termination of a purchased power agreement.
Total electric energy sales for Entergy Mississippi for the nine months ended September 30, 2026 and 2025 are as follows:
| 2026 | 2025 | % Change | |||||||||||||||
| (GWh) | |||||||||||||||||
| Residential | 4,561 | 4,428 | 3 | ||||||||||||||
| Commercial | 3,630 | 3,568 | 2 | ||||||||||||||
| Industrial | 3,409 | 1,915 | 78 | ||||||||||||||
| Governmental | 304 | 305 | — | ||||||||||||||
| Total retail | 11,904 | 10,216 | 17 | ||||||||||||||
| Sales for resale: | |||||||||||||||||
| Non-associated companies | 4,160 | 4,024 | 3 | ||||||||||||||
| Total | 16,064 | 14,240 | 13 | ||||||||||||||
See Note 12 to the financial statements herein for additional discussion of Entergy Mississippi’s operating revenues.
Other Income Statement Variances
Third Quarter 2026 Compared to Third Quarter 2025
Other operation and maintenance expenses increased primarily due to:
•an increase of $4 million in non-nuclear generation expenses primarily due to a higher scope of work performed, including during plant outages, in 2026 as compared to 2025;
•an increase of $3.4 million in power delivery expenses primarily due to higher vegetation maintenance costs; and
•several individually insignificant items.
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Other income increased primarily due to an increase of $6.5 million in the amortization of tax gross-up on customer advances, including customer advances for construction.
Interest expense increased primarily due to the issuance of $650 million of 5.05% Series mortgage bonds in March 2026.
Nine Months Ended September 30, 2026 Compared to Nine Months Ended September 30, 2025
Other operation and maintenance expenses increased primarily due to:
•an increase of $7 million in power delivery expenses primarily due to higher vegetation maintenance costs and increased contract labor costs;
•an increase of $4.1 million in non-nuclear generation expenses primarily due to a higher scope of work performed, including during plant outages, in 2026 as compared to 2025;
•an increase of $2.9 million in compensation and benefits costs primarily due to higher healthcare claims activity and the timing of the recognition of prescription drug rebates;
•an increase of $1.9 million in energy efficiency costs; and
•several individually insignificant items.
The increase was partially offset by a decrease of $3.9 million in storm damage provisions. See Note 2 to the financial statements herein and in the Form 10-K for a discussion of storm cost recovery.
Depreciation and amortization expenses increased primarily due to additions to plant in service.
Other regulatory charges (credits) – net includes a regulatory charge of $21 million, recorded in first quarter 2025, to reflect an adjustment to the grid modernization over/under recovery deferral balance.
Other income increased primarily due to an increase of $14.7 million in the amortization of tax gross-up on customer advances, including customer advances for construction, and an increase of $8.5 million in interest earned on money pool investments. The increase was partially offset by a decrease in the allowance for equity funds used during construction due to lower construction work in progress in 2026.
Interest expense increased primarily due to the issuance of $650 million of 5.05% Series mortgage bonds in March 2026 and the issuance of $600 million of 5.80% Series mortgage bonds in March 2025.
Income Taxes
The effective income tax rates were 25.3% for the third quarter 2026 and 24.8% for the nine months ended September 30, 2026. The differences in the effective income tax rates for the third quarter 2026 and the nine months ended September 30, 2026 versus the federal statutory rate of 21% were primarily due to the accrual for state income taxes, partially offset by certain book and tax differences related to utility plant items.
The effective income tax rates were 24.1% for the third quarter 2025 and 23.9% for the nine months ended September 30, 2025. The differences in the effective income tax rates for the third quarter 2025 and the nine months ended September 30, 2025 versus the federal statutory rate of 21% were primarily due to the accrual for state income taxes, partially offset by certain book and tax differences related to utility plant items.
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Income Tax Legislation and Regulation
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Income Tax Legislation and Regulation” in the Form 10-K for discussion of income tax legislation and regulation.
Liquidity and Capital Resources
Cash Flow
Cash flows for the nine months ended September 30, 2026 and 2025 were as follows:
| 2026 | 2025 | ||||||||||
| (In Thousands) | |||||||||||
| Cash and cash equivalents at beginning of period | $341,484 | $155,693 | |||||||||
| Net cash provided by (used in): | |||||||||||
| Operating activities | 767,610 | 559,353 | |||||||||
| Investing activities | (1,422,983) | (1,121,132) | |||||||||
| Financing activities | 927,965 | 734,761 | |||||||||
| Net increase in cash and cash equivalents | 272,592 | 172,982 | |||||||||
| Cash and cash equivalents at end of period | $614,076 | $328,675 | |||||||||
Operating Activities
Net cash flow provided by operating activities increased $208.3 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to higher collections from customers and an increase of $159.7 million in receipts of advance payments related to customer agreements, including $133.8 million in customer advances and $25.9 million in tax gross-up on customer advances for construction. The increase was partially offset by:
•higher fuel and purchased power payments. See Note 2 to the financial statements in the Form 10-K for a discussion of fuel and purchased power cost recovery;
•the timing of payments to vendors;
•an increase of $18.7 million in non-capital storm spending primarily due to Winter Storm Fern restoration efforts in 2026. See Note 2 to the financial statements herein for discussion of the storm cost recovery filing made by Entergy Mississippi in October 2026;
•higher ad valorem tax payments as a result of increased assessments in 2026; and
•the receipt of a $15 million liquidated damages payment in third quarter 2025 resulting from a counterparty’s termination of a purchased power agreement.
Investing Activities
Net cash flow used in investing activities increased $301.9 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to:
•an increase of $316.8 million in non-nuclear generation construction expenditures primarily due to higher spending on the Penton Solar project and the Traceview Advanced Power Station project;
•an increase of $68.3 million in capital expenditures related to storm restoration primarily due to Winter Storm Fern restoration efforts in 2026. See Note 2 to the financial statements herein for discussion of the storm cost recovery filing made by Entergy Mississippi in October 2026; and
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•the receipt of a $14.5 million initial payment for the sale of transmission rights and excess land related to Entergy Mississippi’s interest in the Independence power plant in third quarter 2025.
The increase was partially offset by money pool activity.
Decreases in Entergy Mississippi’s receivable from the money pool are a source of cash flow, and Entergy Mississippi’s receivable from the money pool decreased $3.4 million for the nine months ended September 30, 2026 compared to increasing by $68.9 million for the nine months ended September 30, 2025. The money pool is an intercompany cash management program that makes possible intercompany borrowing and lending arrangements, and the money pool and other borrowing arrangements are designed to reduce the Registrant Subsidiaries’ dependence on external short-term borrowings.
Financing Activities
Net cash flow provided by financing activities increased $193.2 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to the issuance of $650 million of 5.05% Series mortgage bonds in March 2026 and an increase of $135.5 million in capital contributions received from Entergy Corporation in 2026 as compared to 2025 in order to maintain Entergy Mississippi’s capital structure. The increase was partially offset by the issuance of $600 million of 5.80% Series mortgage bonds in March 2025. See Note 4 to the financial statements herein and Note 5 to the financial statements in the Form 10-K for more details on long-term debt.
Capital Structure
Entergy Mississippi’s debt to capital ratio is shown in the following table.
| September 30, 2026 | December 31, 2025 | ||||||||||
| Debt to capital | 51.2 | % | 50.5 | % | |||||||
| Effect of subtracting cash | (4.5 | %) | (2.9 | %) | |||||||
| Net debt to net capital (non-GAAP) | 46.7 | % | 47.6 | % | |||||||
Net debt consists of debt less cash and cash equivalents. Debt consists of short-term borrowings, finance lease obligations, and long-term debt, including the currently maturing portion. Capital consists of debt and equity. Net capital consists of capital less cash and cash equivalents. Entergy Mississippi uses the debt to capital ratio in analyzing its financial condition and believes it provides useful information to its investors and creditors in evaluating Entergy Mississippi’s financial condition. The net debt to net capital ratio is a non-GAAP measure. Entergy Mississippi also uses the net debt to net capital ratio in analyzing its financial condition and believes it provides useful information to its investors and creditors in evaluating Entergy Mississippi’s financial condition because net debt indicates Entergy Mississippi’s outstanding debt position that could not be readily satisfied by cash and cash equivalents on hand.
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Uses and Sources of Capital
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Liquidity and Capital Resources” in the Form 10-K for a discussion of Entergy Mississippi’s uses and sources of capital. The following are updates to the information provided in the Form 10-K.
Entergy Mississippi is developing its capital investment plan for 2027 through 2030 and currently anticipates making the following construction and other capital investments during that period:
| 2027 | 2028 | 2029 | 2030 | ||||||||||||||||||||
| (In Millions) (a) | |||||||||||||||||||||||
| Planned construction and capital investments: | |||||||||||||||||||||||
| Generation | $1,170 | $570 | $170 | $340 | |||||||||||||||||||
| Transmission | 135 | 170 | 205 | 175 | |||||||||||||||||||
| Distribution | 345 | 315 | 340 | 315 | |||||||||||||||||||
| Utility Support | 65 | 30 | 30 | 30 | |||||||||||||||||||
| Total | $1,715 | $1,085 | $745 | $860 | |||||||||||||||||||
(a)Amounts exclude expenditures expected to be funded through customer advances for construction.
In addition to routine capital spending to maintain operations, the capital plan for Entergy Mississippi includes investments in generation projects to modernize, decarbonize, expand, and diversify Entergy Mississippi’s portfolio, as well as to support customer growth, including Delta Blues Advanced Power Station, Delta Solar, Penton Solar, Traceview Advanced Power Station, Vicksburg Advanced Power Station, and battery energy storage systems; distribution and Utility support spending to improve reliability, resilience, and customer experience; transmission spending to improve reliability and resilience while also supporting customer growth and renewables expansion; and other investments. Estimated capital expenditures are subject to periodic review and modification and may vary based on the ongoing effects of regulatory constraints and requirements, governmental policies and actions, including trade-related governmental actions, such as tariffs, executive orders, and other measures, including Executive Order 14421 and the Section 232 Proclamation, environmental regulations, business opportunities, market volatility, economic trends, business restructuring, changes in project plans, and the ability to access capital, including any changes to governmental programs, such as loans, grants, guarantees, and other subsidies. Entergy Mississippi is not able to predict the effect of potential changes in regulation and law, changes to governmental programs, such as loans, grants, guarantees, and other subsidies, and governmental policies and actions, such as tariffs, executive orders, and other measures, including Executive Order 14421 and the Section 232 Proclamation, on its current and planned capital projects, including project delays, modifications, and cost increases.
Entergy Mississippi’s receivables from the money pool were as follows:
| September 30, 2026 | December 31, 2025 | September 30, 2025 | December 31, 2024 | |||||||||||||||||
| (In Thousands) | ||||||||||||||||||||
| $24,070 | $27,422 | $84,151 | $15,218 | |||||||||||||||||
See Note 4 to the financial statements in the Form 10-K for a description of the money pool.
Entergy Mississippi has a credit facility in the amount of $300 million scheduled to expire in June 2031. The credit facility includes fronting commitments for the issuance of letters of credit against $5 million of the borrowing capacity of the facility. As of September 30, 2026, there were no cash borrowings and no letters of credit outstanding under the credit facility. In addition, Entergy Mississippi is a party to two uncommitted letter of credit facilities as a means to post collateral to support its obligations to MISO and for other purposes. As of September 30, 2026, $125.6 million in MISO letters of credit and $1.3 million in non-MISO letters of credit were
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outstanding under Entergy Mississippi’s uncommitted letter of credit facilities. See Note 4 to the financial statements herein for additional discussion of the credit facilities.
Additional Generation and Transmission Resources
As discussed in the Form 10-K, in March 2024, Entergy Mississippi executed a large customer supply and service agreement to serve two data center campuses located in Madison County, Mississippi in which Amazon Web Services is investing. In February 2025, Entergy Mississippi executed a large customer supply and service agreement to serve a data center campus located in Warren County, Mississippi in which Amazon Web Services is investing. In April 2026, Amazon Web Services announced the expansion of the data center campuses located in Madison County, Mississippi. The February 2025 agreement will apply to this expansion. Also, in April 2026, Entergy Mississippi executed a large customer supply and service agreement to serve a data center campus located in Hinds County, Mississippi in which Amazon Web Services is investing. Consistent with Entergy Mississippi’s Fair Share Plus guidelines, the large customer supply and service agreements are structured to ensure that the customer pays its incremental cost to serve and include protections in the event of early termination.
Winter Storm Fern
In January 2026, Entergy Mississippi’s service territory experienced the effects of Winter Storm Fern, including prolonged freezing temperatures, heavy ice accumulations, and wind, which caused severe damage to Entergy Mississippi’s infrastructure. Following Winter Storm Fern, the “Mississippi 2026 Severe Winter Storm Electric Utility Customer Relief and Electric Utility System Restoration Act” was enacted by the Mississippi Legislature in April 2026. This legislation provides that the MPSC may issue an electric utility financing order authorizing the issuance of system restoration bonds, the proceeds of which shall be used to securitize the system restoration costs and storm damage reserve levels of those utilities affected by Winter Storm Fern. The legislation requires that an electric utility affected by the storm must first petition the MPSC for such a financing order that complies with the requirements outlined in the legislation. The legislation states that any system restoration bonds issued under a financing order will not be considered debt of the electric utility. These bonds will only be secured by the system restoration property specified in the financing order.
In October 2026, Entergy Mississippi filed a petition with the MPSC requesting an electric utility financing order authorizing the Mississippi State Bond Commission to act as the issuing agent for the State of Mississippi to issue system restoration bonds, the proceeds of which would be used by Entergy Mississippi to securitize approximately $237.8 million in total Winter Storm Fern system restoration costs, consisting of $145.7 million in non-fuel system restoration costs, $65.0 million in incremental fuel costs attributable to Winter Storm Fern, $7.6 million in retired damaged assets, $14.3 million in carrying costs estimated through the date of bond issuance, and $5.2 million in bond issuance costs and financing costs. Within the petition, Entergy Mississippi also requested that the MPSC find that the non-fuel system restoration costs and incremental fuel costs attributable to Winter Storm Fern were prudently incurred. The MPSC is expected to rule on the petition in December 2026.
State and Local Rate Regulation and Fuel-Cost Recovery
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - State and Local Rate Regulation and Fuel-Cost Recovery” in the Form 10-K for a discussion of state and local rate regulation and fuel-cost recovery. The following is an update to that discussion.
Retail Rates
2026 Formula Rate Plan Filing
In February 2026, Entergy Mississippi submitted its formula rate plan 2026 test year filing and 2025 look-back filing showing Entergy Mississippi’s earned return on rate base for the historical 2025 calendar year to be
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within the formula rate plan bandwidth and projected earned return for the 2026 calendar year to also be within the formula rate plan bandwidth. The 2026 test year filing resulted in an earned return on rate base of 7.64% and reflected no change in formula rate plan revenues. The 2025 look-back filing compared actual 2025 results to the approved benchmark return on rate base and reflected no change in formula rate plan revenues, although Entergy Mississippi proposed to adjust interim rates by $293 thousand to reflect one outside-the-bandwidth change, a true-up of demand side management costs.
In June 2026, Entergy Mississippi and the Mississippi Public Utilities Staff entered into a joint stipulation that confirmed the 2026 test year filing, with the exception of immaterial adjustments to certain operations and maintenance expenses. The formula rate plan reflected an earned return on rate base of 7.68% for calendar year 2026, resulting in no change in formula rate plan revenues for 2026. Pursuant to the stipulation, Entergy Mississippi’s 2025 look-back filing reflected an earned return on rate base of 8.10%, which also resulted in no change in formula rate plan revenues for 2025. In addition, the stipulation included the recovery of the outside-the-bandwidth change discussed above as well as the ratemaking treatment of certain customer contributions, the mechanism for recovery of the benefits of nuclear production tax credits, and the realignment of the first project from the interim facilities rate adjustment to the formula rate plan. In June 2026 the MPSC approved the joint stipulation with rates effective in July 2026. See Note 10 to the financial statements herein for further discussion of the mechanism for recovery of the benefits of nuclear production tax credits included in the joint stipulation.
Industrial and Commercial Customers
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS – Industrial and Commercial Customers” in the Form 10-K for a discussion of industrial and commercial customers.
Federal Regulation
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS – Federal Regulation” in the Form 10-K and Note 2 to the financial statements herein and in the Form 10-K for a discussion of federal regulation.
Nuclear Matters
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Nuclear Matters” in the Form 10-K for a discussion of nuclear matters.
Environmental Risks
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS – Environmental Risks” in the Form 10-K for a discussion of environmental risks.
Critical Accounting Estimates
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Critical Accounting Estimates” in the Form 10-K for a discussion of the estimates and judgments necessary in Entergy Mississippi’s accounting for utility regulatory accounting, taxation and uncertain tax positions, qualified pension and other postretirement benefits, and other contingencies.
New Accounting Pronouncements
See the “New Accounting Pronouncements” section of Note 1 to the financial statements in the Form 10-K for a discussion of new accounting pronouncements and the “New Accounting Pronouncements” section of
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Entergy Corporation and Subsidiaries Management’s Financial Discussion and Analysis herein for updates to the discussion of new accounting pronouncements.
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| ENTERGY MISSISSIPPI, LLC AND SUBSIDIARIES | ||||||||||||||||||||||||||
| CONSOLIDATED INCOME STATEMENTS | ||||||||||||||||||||||||||
| For the Three and Nine Months Ended September 30, 2026 and 2025 | ||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||
| (In Thousands) | (In Thousands) | |||||||||||||||||||||||||
| OPERATING REVENUES | ||||||||||||||||||||||||||
| Electric | $ | $ | $ | $ | ||||||||||||||||||||||
| OPERATING EXPENSES | ||||||||||||||||||||||||||
| Operation and Maintenance: | ||||||||||||||||||||||||||
| Fuel, fuel-related expenses, and gas purchased for resale | ||||||||||||||||||||||||||
| Purchased power | ||||||||||||||||||||||||||
| Other operation and maintenance | ||||||||||||||||||||||||||
| Taxes other than income taxes | ||||||||||||||||||||||||||
| Depreciation and amortization | ||||||||||||||||||||||||||
| Other regulatory charges (credits) - net | ||||||||||||||||||||||||||
| TOTAL | ||||||||||||||||||||||||||
| OPERATING INCOME | ||||||||||||||||||||||||||
| OTHER INCOME | ||||||||||||||||||||||||||
| Allowance for equity funds used during construction | ||||||||||||||||||||||||||
| Interest and investment income | ||||||||||||||||||||||||||
| Miscellaneous - net | ( | |||||||||||||||||||||||||
| TOTAL | ||||||||||||||||||||||||||
| INTEREST EXPENSE | ||||||||||||||||||||||||||
| Interest expense | ||||||||||||||||||||||||||
| Allowance for borrowed funds used during construction | ( | ( | ( | ( | ||||||||||||||||||||||
| TOTAL | ||||||||||||||||||||||||||
| INCOME BEFORE INCOME TAXES | ||||||||||||||||||||||||||
| Income taxes | ||||||||||||||||||||||||||
| NET INCOME | ||||||||||||||||||||||||||
| Net income (loss) attributable to noncontrolling interest | ( | ( | ||||||||||||||||||||||||
| EARNINGS APPLICABLE TO MEMBER'S EQUITY | $ | $ | $ | $ | ||||||||||||||||||||||
| See Notes to Financial Statements. | ||||||||||||||||||||||||||
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| ENTERGY MISSISSIPPI, LLC AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||
| For the Nine Months Ended September 30, 2026 and 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| OPERATING ACTIVITIES | ||||||||||||||
| Net income | $ | $ | ||||||||||||
| Adjustments to reconcile net income to net cash flow provided by operating activities: | ||||||||||||||
| Depreciation and amortization | ||||||||||||||
| Deferred income taxes, tax credits, and non-current taxes accrued | ||||||||||||||
| Changes in assets and liabilities: | ||||||||||||||
| Receivables | ( | ( | ||||||||||||
| Fuel inventory | ( | |||||||||||||
| Accounts payable | ( | ( | ||||||||||||
| Taxes accrued | ||||||||||||||
| Interest accrued | ||||||||||||||
| Deferred fuel costs | ( | ( | ||||||||||||
| Customer advances - current | ||||||||||||||
| Other working capital accounts | ( | ( | ||||||||||||
| Provisions for estimated losses | ( | ( | ||||||||||||
| Other regulatory assets | ||||||||||||||
| Other regulatory liabilities | ||||||||||||||
| Customer advances - non-current | ||||||||||||||
Pension and other postretirement funded status | ( | ( | ||||||||||||
| Other assets and liabilities | ||||||||||||||
| Net cash flow provided by operating activities | ||||||||||||||
| INVESTING ACTIVITIES | ||||||||||||||
| Construction expenditures | ( | ( | ||||||||||||
| Allowance for equity funds used during construction | ||||||||||||||
| Proceeds from sale of assets | ||||||||||||||
| Changes in money pool receivable - net | ( | |||||||||||||
| Increase in other investments | ( | ( | ||||||||||||
| Net cash flow used in investing activities | ( | ( | ||||||||||||
| FINANCING ACTIVITIES | ||||||||||||||
| Proceeds from the issuance of long-term debt | ||||||||||||||
| Capital contributions from parent | ||||||||||||||
| Customer advances received for construction | ||||||||||||||
| Customer advances used for construction | ( | ( | ||||||||||||
| Other | ( | ( | ||||||||||||
| Net cash flow provided by financing activities | ||||||||||||||
| Net increase in cash and cash equivalents | ||||||||||||||
| Cash and cash equivalents at beginning of period | ||||||||||||||
| Cash and cash equivalents at end of period | $ | $ | ||||||||||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||||||||||||||
| Cash paid during the period for: | ||||||||||||||
| Interest - net of amount capitalized | $ | $ | ||||||||||||
| Noncash investing activities: | ||||||||||||||
| Accrued construction expenditures | $ | $ | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| ENTERGY MISSISSIPPI, LLC AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||||||||
| ASSETS | ||||||||||||||
| September 30, 2026 and December 31, 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| CURRENT ASSETS | ||||||||||||||
| Cash and cash equivalents: | ||||||||||||||
| Cash | $ | $ | ||||||||||||
| Temporary cash investments | ||||||||||||||
| Total cash and cash equivalents | ||||||||||||||
| Accounts receivable: | ||||||||||||||
| Customer | ||||||||||||||
| Allowance for doubtful accounts | ( | ( | ||||||||||||
| Associated companies | ||||||||||||||
| Other | ||||||||||||||
| Accrued unbilled revenues | ||||||||||||||
| Total accounts receivable | ||||||||||||||
| Deferred fuel costs | ||||||||||||||
| Fuel inventory - at average cost | ||||||||||||||
| Materials and supplies | ||||||||||||||
| Prepayments and other | ||||||||||||||
| TOTAL | ||||||||||||||
| OTHER PROPERTY AND INVESTMENTS | ||||||||||||||
| Non-utility property - at cost (less accumulated depreciation) | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| UTILITY PLANT | ||||||||||||||
| Electric | ||||||||||||||
| Construction work in progress | ||||||||||||||
| TOTAL UTILITY PLANT | ||||||||||||||
| Less - accumulated depreciation and amortization | ||||||||||||||
| UTILITY PLANT - NET | ||||||||||||||
| DEFERRED DEBITS AND OTHER ASSETS | ||||||||||||||
| Regulatory assets: | ||||||||||||||
| Other regulatory assets | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| TOTAL ASSETS | $ | $ | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| ENTERGY MISSISSIPPI, LLC AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||||||||
| LIABILITIES AND EQUITY | ||||||||||||||
| September 30, 2026 and December 31, 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| CURRENT LIABILITIES | ||||||||||||||
| Accounts payable: | ||||||||||||||
| Associated companies | $ | $ | ||||||||||||
| Other | ||||||||||||||
| Customer deposits | ||||||||||||||
| Taxes accrued | ||||||||||||||
| Interest accrued | ||||||||||||||
| Customer advances | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| NON-CURRENT LIABILITIES | ||||||||||||||
| Accumulated deferred income taxes and taxes accrued | ||||||||||||||
| Accumulated deferred investment tax credits | ||||||||||||||
| Regulatory liability for income taxes - net | ||||||||||||||
| Other regulatory liabilities | ||||||||||||||
| Customer advances | ||||||||||||||
| Asset retirement cost liabilities | ||||||||||||||
| Accumulated provisions | ||||||||||||||
| Long-term debt | ||||||||||||||
| Customer advances for construction | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| Commitments and Contingencies | ||||||||||||||
| EQUITY | ||||||||||||||
| Member's equity | ||||||||||||||
| Noncontrolling interest | ||||||||||||||
| TOTAL | ||||||||||||||
| TOTAL LIABILITIES AND EQUITY | $ | $ | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| ENTERGY MISSISSIPPI, LLC AND SUBSIDIARIES | |||||||||||||||||
| CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY | |||||||||||||||||
| For the Nine Months Ended September 30, 2026 and 2025 | |||||||||||||||||
| (Unaudited) | |||||||||||||||||
| Noncontrolling Interest | Member's Equity | Total | |||||||||||||||
| (In Thousands) | |||||||||||||||||
| Balance at December 31, 2024 | $ | $ | $ | ||||||||||||||
| Net income (loss) | ( | ||||||||||||||||
| Capital contribution from parent | — | ||||||||||||||||
| Balance at March 31, 2025 | |||||||||||||||||
| Net income (loss) | ( | ||||||||||||||||
| Balance at June 30, 2025 | |||||||||||||||||
| Net income | |||||||||||||||||
| Balance at September 30, 2025 | $ | $ | $ | ||||||||||||||
| Balance at December 31, 2025 | $ | $ | $ | ||||||||||||||
| Net income | |||||||||||||||||
| Capital contribution from parent | — | ||||||||||||||||
| Balance at March 31, 2026 | |||||||||||||||||
| Net income | |||||||||||||||||
| Balance at June 30, 2026 | |||||||||||||||||
| Net income (loss) | ( | ||||||||||||||||
| Balance at September 30, 2026 | $ | $ | $ | ||||||||||||||
| See Notes to Financial Statements. | |||||||||||||||||
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ENTERGY NEW ORLEANS, LLC AND SUBSIDIARIES
MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS
Results of Operations
Net Income
Third Quarter 2026 Compared to Third Quarter 2025
Net income increased $18.7 million primarily due to a $12.8 million ($9.6 million net-of-tax) charge, recorded in third quarter 2025, to reflect the write-off of retained natural gas plant assets that were not included in the sale of Entergy New Orleans’s natural gas distribution business on July 1, 2025, and which will not be recovered from customers, higher volume/weather, higher retail electric price, and lower interest expense, partially offset by higher other operation and maintenance expenses. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy New Orleans natural gas distribution business on July 1, 2025.
Nine Months Ended September 30, 2026 Compared to Nine Months Ended September 30, 2025
Net income increased $10.3 million primarily due to a $12.8 million ($9.6 million net-of-tax) charge, recorded in third quarter 2025, to reflect the write-off of retained natural gas plant assets that were not included in the sale of Entergy New Orleans’s natural gas distribution business on July 1, 2025, and which will not be recovered from customers. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy New Orleans natural gas distribution business on July 1, 2025.
Operating Revenues
Third Quarter 2026 Compared to Third Quarter 2025
Following is an analysis of the change in operating revenues comparing the third quarter 2026 to the third quarter 2025:
| Amount | |||||
| (In Millions) | |||||
| 2025 operating revenues | $220.3 | ||||
| Fuel, rider, and other revenues that do not significantly affect net income | 14.8 | ||||
| Volume/weather | 6.5 | ||||
| Retail electric price | 2.5 | ||||
| 2026 operating revenues | $244.1 | ||||
Entergy New Orleans’s results include revenues from rate mechanisms designed to recover fuel, purchased power, and other costs such that the revenues and expenses associated with these items generally offset and do not affect net income. “Fuel, rider, and other revenues that do not significantly affect net income” includes the revenue variance associated with these items.
The volume/weather variance is primarily due to an increase in residential usage.
The retail electric price variance is primarily due to an increase in formula rate plan rates resulting from an increase in the resilience and storm hardening cost recovery rider revenue requirement effective January 2026. See
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Management’s Financial Discussion and Analysis
Note 2 to the financial statements herein for discussion of the resilience and storm hardening cost recovery rider filing.
Total electric energy sales for Entergy New Orleans for the three months ended September 30, 2026 and 2025 are as follows:
| 2026 | 2025 | % Change | |||||||||||||||
| (GWh) | |||||||||||||||||
| Residential | 830 | 766 | 8 | ||||||||||||||
| Commercial | 619 | 605 | 2 | ||||||||||||||
| Industrial | 90 | 116 | (22) | ||||||||||||||
| Governmental | 227 | 217 | 5 | ||||||||||||||
| Total retail | 1,766 | 1,704 | 4 | ||||||||||||||
| Sales for resale: | |||||||||||||||||
| Non-associated companies | 651 | 762 | (15) | ||||||||||||||
| Total | 2,417 | 2,466 | (2) | ||||||||||||||
See Note 12 to the financial statements herein for additional discussion of Entergy New Orleans’s operating revenues.
Nine Months Ended September 30, 2026 Compared to Nine Months Ended September 30, 2025
Following is an analysis of the change in operating revenues comparing the nine months ended September 30, 2026 to the nine months ended September 30, 2025:
| Amount | |||||
| (In Millions) | |||||
| 2025 operating revenues | $611.4 | ||||
| Fuel, rider, and other revenues that do not significantly affect net income | 66.7 | ||||
| Effect of sale of natural gas distribution business | (68.4) | ||||
| Retail electric price | (2.1) | ||||
| Volume/weather | (1.3) | ||||
| 2026 operating revenues | $606.3 | ||||
Entergy New Orleans’s results include revenues from rate mechanisms designed to recover fuel, purchased power, and other costs such that the revenues and expenses associated with these items generally offset and do not affect net income. “Fuel, rider, and other revenues that do not significantly affect net income” includes the revenue variance associated with these items.
The effect of sale of natural gas distribution business variance represents the decrease in operating revenues resulting from the absence of natural gas revenues following the sale of the natural gas distribution business on July 1, 2025. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy New Orleans natural gas distribution business on July 1, 2025.
The retail electric price variance is primarily due to a decrease in formula rate plan rates effective September 2025 in accordance with the terms of the 2025 formula rate plan filing. See Note 2 to the financial statements in the Form 10-K for discussion of the formula rate plan filing.
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Management’s Financial Discussion and Analysis
The volume/weather variance is primarily due to the effect of less favorable weather on residential and commercial sales, partially offset by an increase in weather-adjusted residential usage.
Total electric energy sales for Entergy New Orleans for the nine months ended September 30, 2026 and 2025 are as follows:
| 2026 | 2025 | % Change | |||||||||||||||
| (GWh) | |||||||||||||||||
| Residential | 1,898 | 1,893 | — | ||||||||||||||
| Commercial | 1,574 | 1,578 | — | ||||||||||||||
| Industrial | 293 | 293 | — | ||||||||||||||
| Governmental | 602 | 589 | 2 | ||||||||||||||
| Total retail | 4,367 | 4,353 | — | ||||||||||||||
| Sales for resale: | |||||||||||||||||
| Non-associated companies | 2,029 | 1,114 | 82 | ||||||||||||||
| Total | 6,396 | 5,467 | 17 | ||||||||||||||
See Note 12 to the financial statements herein for additional discussion of Entergy New Orleans’s operating revenues.
Other Income Statement Variances
Third Quarter 2026 Compared to Third Quarter 2025
Other operation and maintenance expenses increased primarily due to:
•an increase of $2.5 million in energy efficiency expenses primarily due to the timing of recovery from customers;
•a $2.4 million gain, recorded in third quarter 2025, resulting from the sale of the natural gas distribution business on July 1, 2025. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of Entergy New Orleans’s natural gas distribution business on July 1, 2025; and
•several individually insignificant items.
Asset write-offs includes a $12.8 million charge, recorded in third quarter 2025, to reflect the write-off of retained natural gas plant assets that were not included in the sale of Entergy New Orleans’s natural gas distribution business on July 1, 2025, and which will not be recovered from customers. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of Entergy New Orleans’s natural gas distribution business on July 1, 2025.
Interest expense decreased primarily due to a decrease of $2.3 million in carrying costs on regulatory liability balances.
Nine Months Ended September 30, 2026 Compared to Nine Months Ended September 30, 2025
Other operation and maintenance expenses decreased primarily due to a decrease of $6.2 million in gas operations expenses resulting from the absence of expenses following the sale of the natural gas distribution business on July 1, 2025 and a decrease of $2.6 million in non-nuclear generation expenses primarily due to a lower scope of work performed during plant outages in 2026 as compared to 2025. The decrease was partially offset by an increase of $2.6 million in energy efficiency expenses primarily due to the timing of recovery from customers and a $2.4 million gain, recorded in third quarter 2025, resulting from the sale of the natural gas distribution
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Management’s Financial Discussion and Analysis
business on July 1, 2025. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of Entergy New Orleans’s natural gas distribution business on July 1, 2025.
Asset write-offs includes a $12.8 million charge, recorded in third quarter 2025, to reflect the write-off of retained natural gas plant assets that were not included in the sale of Entergy New Orleans’s natural gas distribution business on July 1, 2025, and which will not be recovered. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of Entergy New Orleans’s natural gas distribution business on July 1, 2025.
Taxes other than income taxes decreased primarily due to a decrease in franchise fees as a result of lower retail revenues in 2026 as compared to 2025, including the absence of natural gas revenues in 2026 following the sale of Entergy New Orleans’s natural gas distribution business on July 1, 2025, and the repeal of the Louisiana corporation franchise tax, effective January 2026, as a result of state legislation enacted in December 2024. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy New Orleans natural gas distribution business on July 1, 2025.
Depreciation and amortization expenses decreased primarily due to the absence of depreciation and amortization expenses associated with natural gas plant in service following the sale of the natural gas distribution business on July 1, 2025. See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy New Orleans natural gas distribution business on July 1, 2025.
Interest expense decreased primarily due to a decrease of $8.3 million in carrying costs on regulatory liability balances.
Income Taxes
The effective income tax rate was 24.5% for the third quarter 2026 and 22.1% for the nine months ended September 30, 2026. The differences in the effective income tax rates for the third quarter 2026 and the nine months ended September 30, 2026 versus the federal statutory rate of 21% were primarily due to the accrual for state income taxes and a provision for uncertain tax positions, partially offset by the amortization of excess accumulated deferred income taxes as a result of tax rate changes and certain book and tax differences related to utility plant items.
The effective income tax rate was 25.5% for the third quarter 2025. The difference in the effective income tax rate for the third quarter 2025 versus the federal statutory rate of 21% was primarily due to the accrual for state income taxes, partially offset by the amortization of excess accumulated deferred income taxes.
The effective income tax rate was 24.6% for the nine months ended September 30, 2025. The difference in the effective income tax rate for the nine months ended September 30, 2025 versus the federal statutory rate of 21% was primarily due to the accrual for state income taxes, partially offset by certain book and tax differences related to utility plant items.
Income Tax Legislation and Regulation
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Income Tax Legislation and Regulation” in the Form 10-K for discussion of income tax legislation and regulation.
Sale of Natural Gas Distribution Business
See Note 14 to the financial statements in the Form 10-K for discussion of the sale of the Entergy New Orleans natural gas distribution business on July 1, 2025.
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Entergy New Orleans, LLC and Subsidiaries
Management’s Financial Discussion and Analysis
Liquidity and Capital Resources
Cash Flow
Cash flows for the nine months ended September 30, 2026 and 2025 were as follows:
| 2026 | 2025 | ||||||||||
| (In Thousands) | |||||||||||
| Cash and cash equivalents at beginning of period | $110,264 | $31,777 | |||||||||
| Net cash provided by (used in): | |||||||||||
| Operating activities | 77,504 | 97,801 | |||||||||
| Investing activities | (111,845) | 156,869 | |||||||||
| Financing activities | 3,226 | (217,747) | |||||||||
| Net increase (decrease) in cash and cash equivalents | (31,115) | 36,923 | |||||||||
| Cash and cash equivalents at end of period | $79,149 | $68,700 | |||||||||
Operating Activities
Net cash flow provided by operating activities decreased $20.3 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to lower collections from customers, partially offset by lower fuel and purchased power payments in 2026 as compared to 2025 and the timing of payments to vendors.
Investing Activities
Entergy New Orleans’s investing activities used $111.8 million for the nine months ended September 30, 2026 compared to providing $156.9 million for the nine months ended September 30, 2025 primarily due to the following activity:
•the receipt of $288.3 million in proceeds from the sale of the natural gas distribution business on July 1, 2025;
•an increase of $28.7 million in distribution construction expenditures primarily due to increased investment in the resilience and reliability of the distribution system;
•the receipt of $10.3 million from the storm reserve escrow account in 2025;
•a decrease of $8.8 million in gas operations construction expenditures resulting from the absence of construction expenditures following the sale of the natural gas distribution business on July 1, 2025;
•money pool activity; and
•a decrease of $22.4 million in non-nuclear generation construction expenditures primarily due to a lower scope of work during plant outages performed in 2026 as compared to 2025.
See Note 14 to the financial statements in the Form 10-K for discussion of the sale of Entergy New Orleans’s natural gas distribution business on July 1, 2025.
Decreases in Entergy New Orleans’s receivable from the money pool are a source of cash flow, and Entergy New Orleans’s receivable from the money pool decreased by $5.9 million for the nine months ended September 30, 2026 compared to increasing by $14.7 million for the nine months ended September 30, 2025. The money pool is an intercompany cash management program that makes possible intercompany borrowing and lending arrangements, and the money pool and other borrowing arrangements are designed to reduce the Registrant Subsidiaries’ dependence on external short-term borrowings.
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Management’s Financial Discussion and Analysis
Financing Activities
Entergy New Orleans’s financing activities provided $3.2 million for the nine months ended September 30, 2026 compared to using $217.7 million the nine months ended September 30, 2025 primarily due to the following activity:
•$140 million in common equity distributions paid in 2025 in order to maintain Entergy New Orleans’s capital structure;
•the issuances of $55 million of 6.65% Series mortgage bonds and $35 million of 5.91% Series mortgage bonds, each in May 2026;
•the repayment, at maturity, of $78 million of 3.00% Series mortgage bonds in March 2025; and
•the repayment of $85 million of 4% Series mortgage bonds in June 2026.
See Note 4 to the financial statements herein and Note 5 to the financial statements in the Form 10-K for more details on long-term debt.
Capital Structure
Entergy New Orleans’s debt to capital ratio is shown in the following table. The decrease in the debt to capital ratio for Entergy New Orleans is primarily due to net income in 2026.
| September 30, 2026 | December 31, 2025 | ||||||||||
| Debt to capital | 49.8 | % | 52.1 | % | |||||||
| Effect of subtracting cash | (3.1 | %) | (4.6 | %) | |||||||
| Net debt to net capital (non-GAAP) | 46.7 | % | 47.5 | % | |||||||
Net debt consists of debt less cash and cash equivalents. Debt consists of short-term borrowings, finance lease obligations, long-term debt, including the currently maturing portion, and the long-term payable due to an associated company. Capital consists of debt and equity. Net capital consists of capital less cash and cash equivalents. Entergy New Orleans uses the debt to capital ratio in analyzing its financial condition and believes it provides useful information to its investors and creditors in evaluating Entergy New Orleans’s financial condition. The net debt to net capital ratio is a non-GAAP measure. Entergy New Orleans also uses the net debt to net capital ratio in analyzing its financial condition and believes it provides useful information to its investors and creditors in evaluating Entergy New Orleans’s financial condition because net debt indicates Entergy New Orleans’s outstanding debt position that could not be readily satisfied by cash and cash equivalents on hand.
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Management’s Financial Discussion and Analysis
Uses and Sources of Capital
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Liquidity and Capital Resources” in the Form 10-K for a discussion of Entergy New Orleans’s uses and sources of capital. The following are updates to the information provided in the Form 10-K.
Entergy New Orleans is developing its capital investment plan for 2027 through 2030 and currently anticipates making the following construction and other capital investments during that period:
| 2027 | 2028 | 2029 | 2030 | ||||||||||||||||||||
| (In Millions) (a) | |||||||||||||||||||||||
| Planned construction and capital investments: | |||||||||||||||||||||||
| Generation | $5 | $15 | $15 | $5 | |||||||||||||||||||
| Transmission | 10 | 20 | 20 | 15 | |||||||||||||||||||
| Distribution | 130 | 140 | 155 | 150 | |||||||||||||||||||
| Utility Support | 10 | 10 | 10 | 15 | |||||||||||||||||||
| Total | $155 | $185 | $200 | $185 | |||||||||||||||||||
(a)Amounts exclude expenditures expected to be funded through customer advances for construction.
In addition to routine capital spending to maintain operations, the capital plan for Entergy New Orleans includes distribution and Utility support spending to improve reliability, resilience, and customer experience; transmission spending to improve reliability and resilience; and other investments. Estimated capital expenditures are subject to periodic review and modification and may vary based on the ongoing effects of regulatory constraints and requirements, governmental policies and actions, including trade-related governmental actions, such as tariffs, executive orders, and other measures, including Executive Order 14421 and the Section 232 Proclamation, environmental regulations, business opportunities, market volatility, economic trends, business restructuring, changes in project plans, and the ability to access capital, including any changes to governmental programs, such as loans, grants, guarantees, and other subsidies. Entergy New Orleans is not able to predict the effect of potential changes in regulation and law, changes to governmental programs, such as loans, grants, guarantees, and other subsidies, and governmental policies and actions, such as tariffs, executive orders, and other measures, including Executive Order 14421 and the Section 232 Proclamation, on its current and planned capital projects, including project delays, modifications, and cost increases.
Entergy New Orleans’s receivables from the money pool were as follows:
| September 30, 2026 | December 31, 2025 | September 30, 2025 | December 31, 2024 | |||||||||||||||||
| (In Thousands) | ||||||||||||||||||||
| $3,125 | $9,009 | $17,843 | $3,146 | |||||||||||||||||
See Note 4 to the financial statements in the Form 10-K for a description of the money pool.
Entergy New Orleans has a credit facility in the amount of $25 million scheduled to expire in June 2027. The credit facility includes fronting commitments for the issuance of letters of credit against $10 million of the borrowing capacity of the facility. As of September 30, 2026, there were no cash borrowings and no letters of credit outstanding under the credit facility. In addition, Entergy New Orleans is a party to an uncommitted letter of credit facility as a means to post collateral to support its obligations to MISO. As of September 30, 2026, a $0.5 million letter of credit was outstanding under Entergy New Orleans’s uncommitted letter of credit facility. See Note 4 to the financial statements herein for additional discussion of the credit facilities.
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Entergy New Orleans, LLC and Subsidiaries
Management’s Financial Discussion and Analysis
State and Local Rate Regulation
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS – State and Local Rate Regulation” in the Form 10-K for a discussion of state and local rate regulation. The following are updates to that discussion.
Retail Rates
2026 Formula Rate Plan Filing
In April 2026, Entergy New Orleans submitted to the City Council its formula rate plan 2025 test year filing. The 2025 evaluation report produced an earned return on equity of 7.55% compared to the authorized return on equity of 9.35%. Without adjustments, this would result in an increase in rates of $16.6 million. The increase in rates is driven, in part, by an increase in plant in service, as well as the cost of known and measurable capital additions. The increase is also driven by a decrease in total revenues due to a decline in kWh sales. The filing is subject to a 75-day review and discovery period followed by a 25-day period to resolve any disputes among the parties.
In July 2026 the City Council’s advisors issued a report seeking a reduction in Entergy New Orleans’s requested formula rate plan revenues of approximately $4.4 million due to certain proposed cost realignments, imputation of revenues, and disallowances. The City Council’s advisors also recommended that Entergy New Orleans be permitted to collect $20 million over five years beginning in September 2026 to recover amounts that it might be required to pay Entergy Louisiana and Entergy Arkansas pursuant to a FERC order issued in June 2026, relating to an alleged MSS-4R violation. However, the FERC order is unclear on its face, and the specific amount of a payment, if any, is unknown. Requests for rehearing and clarification of the FERC order are pending. See “MSS-4 Replacement Tariff - Net Operating Loss Carryforward Proceeding” in Note 2 to the financial statements herein for additional discussion of the FERC order. Subsequent to the original recommendation from the City Council’s advisors regarding the FERC order, Entergy New Orleans reached a resolution with the City Council’s advisors, and the original proposed $20 million amount was reduced to $10 million over five years. Effective with the first billing cycle of September 2026, Entergy New Orleans implemented rates reflecting a formula rate plan increase of $13.8 million, as agreed upon by Entergy New Orleans and the City Council, per the approved process for formula rate plan implementation. Moreover, with respect to the FERC order, in October 2026 the City Council passed a resolution directing Entergy New Orleans to collect $2.3 million for year one, beginning in September 2026 from customers in anticipation of surcharge obligations resulting from the FERC order, to be collected outside the bandwidth. Until either the FERC determines or it is otherwise agreed that Entergy New Orleans must pay a surcharge, amounts collected from customers beginning September 2026 in anticipation of surcharge obligations resulting from the FERC order are being recorded as a regulatory liability. If the FERC determines or it is otherwise agreed that Entergy New Orleans must pay a surcharge, Entergy New Orleans will record a regulatory asset for the remaining uncollected balance, with carrying costs, including credit balances reflecting collections from customers that commenced in September 2026. If the FERC determines or it is otherwise agreed that Entergy New Orleans is owed payments, Entergy New Orleans will cease collecting amounts from customers beginning with the next base rate action and will return collected amounts to customers, including carrying costs.
Request for Extension of Formula Rate Plan
In July 2026, Entergy New Orleans submitted a motion requesting the City Council’s approval of a four-year extension of its current formula rate plan, with all material provisions left unchanged. In October 2026 the City Council approved Entergy New Orleans’s motion, authorizing the extension of Entergy New Orleans’s electric formula rate plan for test years 2026 through 2029.
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Entergy New Orleans, LLC and Subsidiaries
Management’s Financial Discussion and Analysis
Resilience and Storm Hardening Cost Recovery Rider Adjustment to the Formula Rate Plan
In October 2024 the City Council approved a rider mechanism for Entergy New Orleans to recover the costs of certain approved accelerated resilience projects to be constructed by Entergy New Orleans in 2025 and 2026. The rider allows for recovery of project costs through a formula rate plan rate adjustment. As required by the rider, in November 2024, Entergy New Orleans filed the first of its compliance filings, seeking a rate adjustment increase of approximately $1.1 million, and the increase in formula rate plan rates became effective in the first billing cycle of January 2025 in accordance with the terms of the rider. In October 2025, Entergy New Orleans made its second compliance filing, seeking a rate adjustment increase of approximately $11.8 million, and the increase in formula rate plan rates became effective in the first billing cycle of January 2026.
Distributed Energy Resource Program
As discussed in the Form 10-K, in October 2024 the City Council opened a docket to evaluate potential opportunities to increase the availability of distributed energy resources, battery storage, and related facilities in New Orleans. In December 2025 the City Council issued a resolution establishing a distributed energy resources program to be implemented and operated under the existing Energy Smart program, with $28 million in customer incentives available through credits funded by the settlement between System Energy and the City Council. In March 2026, as required by the City Council, Entergy New Orleans submitted to the City Council a proposed battery storage implementation plan, in which program costs would be offset by credits from the System Energy settlement, with no incremental impact on customer rates. See “Complaints Against System Energy - System Energy Settlement with the City Council” in Note 2 to the financial statements in the Form 10-K for discussion of the System Energy settlement with the City Council.
An intervenor in the proceeding challenged the plan submitted by Entergy New Orleans and sought additional incentives for participating customers, including accelerated use of the credits. In July 2026 certain stakeholders submitted comments in support of that intervenor’s position. In August 2026 the City Council’s advisors issued a report that, among other things, summarized the parties’ positions and identified various issues for determination by the City Council.
In October 2026 the City Council approved a resolution that increased the amount of upfront incentives for participating customers and did not clearly address the total cost of ongoing customer incentives, such that all incentives and costs associated with the program could exceed the credits from the System Energy settlement, in which case incremental costs would have to be borne more broadly by customers through rates, including those customers who do not participate in the program. Pursuant to the resolution, Entergy New Orleans expects to submit an implementation plan to the City Council in November 2026, providing for implementation by the end of first quarter 2027. The resolution further directs Entergy New Orleans and the City Council’s advisors to collaborate to develop certain protections for customers participating in the program and to report to the City Council on such efforts in November 2026.
Federal Regulation
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS – Federal Regulation” in the Form 10-K and Note 2 to the financial statements herein and in the Form 10-K for a discussion of federal regulation.
Nuclear Matters
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Nuclear Matters” in the Form 10-K for a discussion of nuclear matters.
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Entergy New Orleans, LLC and Subsidiaries
Management’s Financial Discussion and Analysis
Environmental Risks
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Environmental Risks” in the Form 10-K for a discussion of environmental risks.
Critical Accounting Estimates
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Critical Accounting Estimates” in the Form 10-K for a discussion of the estimates and judgments necessary in Entergy New Orleans’s accounting for utility regulatory accounting, taxation and uncertain tax positions, qualified pension and other postretirement benefits, and other contingencies.
New Accounting Pronouncements
See the “New Accounting Pronouncements” section of Note 1 to the financial statements in the Form 10-K for a discussion of new accounting pronouncements and the “New Accounting Pronouncements” section of Entergy Corporation and Subsidiaries Management’s Financial Discussion and Analysis herein for updates to the discussion of new accounting pronouncements.
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| ENTERGY NEW ORLEANS, LLC AND SUBSIDIARIES | ||||||||||||||||||||||||||
| CONSOLIDATED INCOME STATEMENTS | ||||||||||||||||||||||||||
| For the Three and Nine Months Ended September 30, 2026 and 2025 | ||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||
| (In Thousands) | (In Thousands) | |||||||||||||||||||||||||
| OPERATING REVENUES | ||||||||||||||||||||||||||
| Electric | $ | $ | $ | $ | ||||||||||||||||||||||
| Natural gas | ||||||||||||||||||||||||||
| TOTAL | ||||||||||||||||||||||||||
| OPERATING EXPENSES | ||||||||||||||||||||||||||
| Operation and Maintenance: | ||||||||||||||||||||||||||
| Fuel, fuel-related expenses, and gas purchased for resale | ||||||||||||||||||||||||||
| Purchased power | ||||||||||||||||||||||||||
| Other operation and maintenance | ||||||||||||||||||||||||||
| Asset write-offs | ||||||||||||||||||||||||||
| Taxes other than income taxes | ||||||||||||||||||||||||||
| Depreciation and amortization | ||||||||||||||||||||||||||
| Other regulatory charges (credits) - net | ( | ( | ( | ( | ||||||||||||||||||||||
| TOTAL | ||||||||||||||||||||||||||
| OPERATING INCOME | ||||||||||||||||||||||||||
| OTHER INCOME | ||||||||||||||||||||||||||
| Allowance for equity funds used during construction | ||||||||||||||||||||||||||
| Interest and investment income | ||||||||||||||||||||||||||
| Miscellaneous - net | ( | ( | ( | ( | ||||||||||||||||||||||
| TOTAL | ||||||||||||||||||||||||||
| INTEREST EXPENSE | ||||||||||||||||||||||||||
| Interest expense | ||||||||||||||||||||||||||
| Allowance for borrowed funds used during construction | ( | ( | ( | ( | ||||||||||||||||||||||
| TOTAL | ||||||||||||||||||||||||||
| INCOME BEFORE INCOME TAXES | ||||||||||||||||||||||||||
| Income taxes | ||||||||||||||||||||||||||
| NET INCOME | $ | $ | $ | $ | ||||||||||||||||||||||
| See Notes to Financial Statements. | ||||||||||||||||||||||||||
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| ENTERGY NEW ORLEANS, LLC AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||
| For the Nine Months Ended September 30, 2026 and 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| OPERATING ACTIVITIES | ||||||||||||||
| Net income | $ | $ | ||||||||||||
| Adjustments to reconcile net income to net cash flow provided by operating activities: | ||||||||||||||
| Depreciation and amortization | ||||||||||||||
| Deferred income taxes, tax credits, and non-current taxes accrued | ||||||||||||||
| Asset write-offs | ||||||||||||||
| Changes in assets and liabilities: | ||||||||||||||
| Receivables | ( | ( | ||||||||||||
| Fuel inventory | ||||||||||||||
| Accounts payable | ( | |||||||||||||
| Prepaid taxes and taxes accrued | ||||||||||||||
| Interest accrued | ||||||||||||||
| Deferred fuel costs | ( | |||||||||||||
| Other working capital accounts | ( | ( | ||||||||||||
| Provisions for estimated losses | ( | |||||||||||||
| Other regulatory assets | ||||||||||||||
| Other regulatory liabilities | ( | ( | ||||||||||||
| Pension and other postretirement funded status | ( | |||||||||||||
| Other assets and liabilities | ( | |||||||||||||
| Net cash flow provided by operating activities | ||||||||||||||
| INVESTING ACTIVITIES | ||||||||||||||
| Construction expenditures | ( | ( | ||||||||||||
| Allowance for equity funds used during construction | ||||||||||||||
| Changes in money pool receivable - net | ( | |||||||||||||
| Receipt from storm reserve escrow account | ||||||||||||||
| Payments to storm reserve escrow account | ( | ( | ||||||||||||
| Proceeds from sale of business | ||||||||||||||
| Changes in securitization account | ||||||||||||||
| Increase in other investments | ( | |||||||||||||
| Net cash flow provided by (used in) investing activities | ( | |||||||||||||
| FINANCING ACTIVITIES | ||||||||||||||
| Proceeds from the issuance of long-term debt | ||||||||||||||
| Retirement of long-term debt | ( | ( | ||||||||||||
| Common equity distributions paid | ( | |||||||||||||
| Other | ( | |||||||||||||
| Net cash flow provided by (used in) financing activities | ( | |||||||||||||
| Net increase (decrease) in cash and cash equivalents | ( | |||||||||||||
| Cash and cash equivalents at beginning of period | ||||||||||||||
| Cash and cash equivalents at end of period | $ | $ | ||||||||||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||||||||||||||
| Cash paid during the period for: | ||||||||||||||
| Interest - net of amount capitalized | $ | $ | ||||||||||||
| Income taxes - net | $ | $ | ||||||||||||
| Noncash investing activities: | ||||||||||||||
| Accrued construction expenditures | $ | $ | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| ENTERGY NEW ORLEANS, LLC AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||||||||
| ASSETS | ||||||||||||||
| September 30, 2026 and December 31, 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| CURRENT ASSETS | ||||||||||||||
| Cash and cash equivalents: | ||||||||||||||
| Cash | $ | $ | ||||||||||||
| Temporary cash investments | ||||||||||||||
| Total cash and cash equivalents | ||||||||||||||
| Accounts receivable: | ||||||||||||||
| Customer | ||||||||||||||
| Allowance for doubtful accounts | ( | ( | ||||||||||||
| Associated companies | ||||||||||||||
| Other | ||||||||||||||
| Accrued unbilled revenues | ||||||||||||||
| Total accounts receivable | ||||||||||||||
| Fuel inventory - at average cost | ||||||||||||||
| Materials and supplies | ||||||||||||||
| Prepayments and other | ||||||||||||||
| TOTAL | ||||||||||||||
| OTHER PROPERTY AND INVESTMENTS | ||||||||||||||
| Storm reserve escrow account | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| UTILITY PLANT | ||||||||||||||
| Electric | ||||||||||||||
| Construction work in progress | ||||||||||||||
| TOTAL UTILITY PLANT | ||||||||||||||
| Less - accumulated depreciation and amortization | ||||||||||||||
| UTILITY PLANT - NET | ||||||||||||||
| DEFERRED DEBITS AND OTHER ASSETS | ||||||||||||||
| Regulatory assets: | ||||||||||||||
| Other regulatory assets | ||||||||||||||
| Deferred fuel costs | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| TOTAL ASSETS | $ | $ | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| ENTERGY NEW ORLEANS, LLC AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||||||||
| LIABILITIES AND EQUITY | ||||||||||||||
| September 30, 2026 and December 31, 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| CURRENT LIABILITIES | ||||||||||||||
| Currently maturing long-term debt | $ | $ | ||||||||||||
| Payable due to associated company | ||||||||||||||
| Accounts payable: | ||||||||||||||
| Associated companies | ||||||||||||||
| Other | ||||||||||||||
| Customer deposits | ||||||||||||||
| Taxes accrued | ||||||||||||||
| Interest accrued | ||||||||||||||
| Deferred fuel costs | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| NON-CURRENT LIABILITIES | ||||||||||||||
| Accumulated deferred income taxes and taxes accrued | ||||||||||||||
| Accumulated deferred investment tax credits | ||||||||||||||
| Regulatory liability for income taxes - net | ||||||||||||||
| Other regulatory liabilities | ||||||||||||||
| Accumulated provisions | ||||||||||||||
| Long-term debt | ||||||||||||||
| Long-term payable due to associated company | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| Commitments and Contingencies | ||||||||||||||
| EQUITY | ||||||||||||||
| Member's equity | ||||||||||||||
| TOTAL | ||||||||||||||
| TOTAL LIABILITIES AND EQUITY | $ | $ | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| ENTERGY NEW ORLEANS, LLC AND SUBSIDIARIES | ||||||||
| CONSOLIDATED STATEMENTS OF CHANGES IN MEMBER'S EQUITY | ||||||||
| For the Nine Months Ended September 30, 2026 and 2025 | ||||||||
| (Unaudited) | ||||||||
| Member's Equity | ||||||||
| (In Thousands) | ||||||||
| Balance at December 31, 2024 | $ | |||||||
| Net income | ||||||||
| Balance at March 31, 2025 | ||||||||
| Net income | ||||||||
| Balance at June 30, 2025 | ||||||||
| Net income | ||||||||
| Common equity distributions | ( | |||||||
| Balance at September 30, 2025 | $ | |||||||
| Balance at December 31, 2025 | $ | |||||||
| Net income | ||||||||
| Balance at March 31, 2026 | ||||||||
| Net income | ||||||||
| Balance at June 30, 2026 | ||||||||
| Net income | ||||||||
| Balance at September 30, 2026 | $ | |||||||
| See Notes to Financial Statements. | ||||||||
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ENTERGY TEXAS, INC. AND SUBSIDIARIES
MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS
Results of Operations
Net Income
Third Quarter 2026 Compared to Third Quarter 2025
Net income increased $46.8 million primarily due to higher volume/weather, higher retail electric price, and higher other income, partially offset by higher taxes other than income taxes, higher interest expense, higher unrecovered capacity costs in 2026, and higher other operation and maintenance expenses.
Nine Months Ended September 30, 2026 Compared to Nine Months Ended September 30, 2025
Net income increased $65.2 million primarily due to higher volume/weather, higher retail electric price, higher other income, and higher unrecovered capacity costs in 2025, partially offset by higher other operation and maintenance expenses, higher taxes other than income taxes, and higher interest expense.
Operating Revenues
Third Quarter 2026 Compared to Third Quarter 2025
Following is an analysis of the change in operating revenues comparing the third quarter 2026 to the third quarter 2025:
| Amount | |||||
| (In Millions) | |||||
2025 operating revenues | $640.3 | ||||
| Fuel, rider, and other revenues that do not significantly affect net income | 42.7 | ||||
| Volume/weather | 52.7 | ||||
| Retail electric price | 16.8 | ||||
2026 operating revenues | $752.5 | ||||
Entergy Texas’s results include revenues from rate mechanisms designed to recover fuel, purchased power, and other costs such that the revenues and expenses associated with these items generally offset and do not affect net income. “Fuel, rider, and other revenues that do not significantly affect net income” includes the revenue variance associated with these items.
The volume/weather variance is primarily due to an increase in industrial usage, an increase in weather-adjusted residential usage, and the effect of more favorable weather on residential sales. The increase in industrial usage is primarily due to an increase in demand from large industrial customers, primarily agricultural and other chemicals, transportation, and petrochemicals customers. The increase in weather-adjusted residential usage is primarily due to an increase in customers.
The retail electric price variance is primarily due to increases in the distribution cost recovery factor rider effective December 2025 and July 2026 and an increase in the transmission cost recovery factor rider effective April 2026. See Note 2 to the financial statements herein and in the Form 10-K for discussion of the distribution and transmission cost recovery factor rider filings.
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Entergy Texas, Inc. and Subsidiaries
Management’s Financial Discussion and Analysis
Total electric energy sales for Entergy Texas for the three months ended September 30, 2026 and 2025 are as follows:
2026 | 2025 | % Change | |||||||||||||||
| (GWh) | |||||||||||||||||
| Residential | 2,514 | 2,213 | 14 | ||||||||||||||
| Commercial | 1,582 | 1,479 | 7 | ||||||||||||||
| Industrial | 3,025 | 2,574 | 18 | ||||||||||||||
| Governmental | 80 | 73 | 10 | ||||||||||||||
| Total retail | 7,201 | 6,339 | 14 | ||||||||||||||
| Sales for resale: | |||||||||||||||||
| Non-associated companies | 175 | 120 | 46 | ||||||||||||||
| Total | 7,376 | 6,459 | 14 | ||||||||||||||
See Note 12 to the financial statements herein for additional discussion of Entergy Texas’s operating revenues.
Nine Months Ended September 30, 2026 Compared to Nine Months Ended September 30, 2025
Following is an analysis of the change in operating revenues comparing the nine months ended September 30, 2026 to the nine months ended September 30, 2025:
| Amount | |||||
| (In Millions) | |||||
2025 operating revenues | $1,613.9 | ||||
| Fuel, rider, and other revenues that do not significantly affect net income | 106.9 | ||||
| Volume/weather | 61.0 | ||||
| Retail electric price | 42.9 | ||||
2026 operating revenues | $1,824.7 | ||||
Entergy Texas’s results include revenues from rate mechanisms designed to recover fuel, purchased power, and other costs such that the revenues and expenses associated with these items generally offset and do not affect net income. “Fuel, rider, and other revenues that do not significantly affect net income” includes the revenue variance associated with these items.
The volume/weather variance is primarily due to an increase in industrial usage and an increase in weather-adjusted residential usage, partially offset by the effect of less favorable weather on residential sales. The increase in industrial usage is primarily due to an increase in demand from large industrial customers, primarily agricultural and other chemicals, transportation, and industrial gases customers. The increase in weather-adjusted residential usage is primarily due to an increase in customers.
The retail electric price variance is primarily due to increases in the distribution cost recovery factor rider effective June 2025, December 2025, and July 2026 and an increase in the transmission cost recovery factor rider effective April 2026. See Note 2 to the financial statements herein and in the Form 10-K for discussion of the distribution and transmission cost recovery factor rider filings.
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Entergy Texas, Inc. and Subsidiaries
Management’s Financial Discussion and Analysis
Total electric energy sales for Entergy Texas for the nine months ended September 30, 2026 and 2025 are as follows:
2026 | 2025 | % Change | |||||||||||||||
| (GWh) | |||||||||||||||||
| Residential | 5,662 | 5,514 | 3 | ||||||||||||||
| Commercial | 3,998 | 3,869 | 3 | ||||||||||||||
| Industrial | 8,393 | 7,355 | 14 | ||||||||||||||
| Governmental | 219 | 201 | 9 | ||||||||||||||
| Total retail | 18,272 | 16,939 | 8 | ||||||||||||||
| Sales for resale: | |||||||||||||||||
| Non-associated companies | 432 | 264 | 64 | ||||||||||||||
| Total | 18,704 | 17,203 | 9 | ||||||||||||||
See Note 12 to the financial statements herein for additional discussion of Entergy Texas’s operating revenues.
Other Income Statement Variances
Third Quarter 2026 Compared to Third Quarter 2025
Purchased power includes:
•$14.6 million of unrecovered capacity cost charges in 2026 under a new short-term, one-year power purchase agreement beginning in June 2026; and
•$11.5 million of higher unrecovered costs in 2025 related to the procurement of capacity through MISO’s annual planning resource auction. Higher costs in third quarter 2025 resulted from the effect of a significant increase in MISO’s seasonal auction clearing price, due to the implementation of a reliability-based demand curve, for capacity transactions during the summer months in 2025. Prior to June 2026, Entergy Texas also did not have the ability to recover its MISO capacity costs incurred to date beyond the level included in base rates. In June 2025, Texas legislation established a capacity cost recovery rider mechanism that would allow for the recovery of costs related to the procurement of capacity through MISO’s annual planning resource auction outside of base rates, through a rider that is updated annually. In May 2026, Entergy Texas filed a request with the PUCT for a capacity cost recovery rider to recover eligible capacity procurement costs associated with its participation in MISO’s annual planning resource auction, and the PUCT approved the request in July 2026. See Note 2 to the financial statements herein for discussion of the capacity cost recovery rider.
Other operation and maintenance expenses increased primarily due to an increase of $1.7 million in energy efficiency expenses primarily due to the timing of recovery from customers and several individually insignificant items. The increase was partially offset by a decrease of $1.6 million in loss provisions and a decrease of $1.4 million in bad debt expense.
Taxes other than income taxes increased primarily due to increases in ad valorem taxes resulting from higher assessments.
Other income increased primarily due to higher interest earned on money pool investments and an increase in the allowance for equity funds used during construction due to higher construction work in progress in 2026, including the Orange County Advanced Power Station project and the Lone Star Power Station project, partially offset by lower construction work in progress in 2026 on the Legend Power Station project as a result of the sale of
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Management’s Financial Discussion and Analysis
assets related to the in-process project in December 2025. See Note 8 to the financial statements in the Form 10-K for discussion of the Entergy Texas build-to-suit lease arrangement for the Legend Power Station.
Interest expense increased primarily due to the issuance of $425 million of 5.20% Series mortgage bonds in May 2026.
Nine Months Ended September 30, 2026 Compared to Nine Months Ended September 30, 2025
Purchased power includes:
•$27.2 million of higher unrecovered costs in 2025 related to the procurement of capacity through MISO’s annual planning resource auction. Higher costs in 2025 resulted from the effect of a significant increase in MISO’s seasonal auction clearing price, due to the implementation of a reliability-based demand curve, for capacity transactions during the summer months in 2025. Prior to June 2026, Entergy Texas also did not have the ability to recover its MISO capacity costs incurred to date beyond the level included in base rates. In June 2025, Texas legislation established a capacity cost recovery rider mechanism that would allow for the recovery of costs related to the procurement of capacity through MISO’s annual planning resource auction outside of base rates, through a rider that is updated annually. In May 2026, Entergy Texas filed a request with the PUCT for a capacity cost recovery rider to recover eligible capacity procurement costs associated with its participation in MISO’s annual planning resource auction, and the PUCT approved the request in July 2026. See Note 2 to the financial statements herein for discussion of the capacity cost recovery rider; and
•$19.4 million of unrecovered capacity cost charges in 2026 under a new short-term, one-year power purchase agreement beginning in June 2026.
Other operation and maintenance expenses increased primarily due to:
•an increase of $2.6 million in energy efficiency expenses primarily due to the timing of recovery from customers;
•an increase of $2.2 million in compensation and benefits costs primarily due to higher healthcare claims activity, the timing of the recognition of prescription drug rebates, and a larger revision to estimated incentive-based compensation expense in 2025;
•an increase of $2.1 million in power delivery expenses primarily due to higher vegetation maintenance costs and increased contract labor costs;
•an increase of $1.9 million in insurance expense primarily due to higher premiums in 2026 as compared to 2025;
•an increase of $1.5 million in transmission costs allocated by MISO; and
•several individually insignificant items.
The increase was partially offset by a decrease of $7.5 million in bad debt expense and a decrease of $1.5 million in loss provisions.
Taxes other than income taxes increased primarily due to increases in ad valorem taxes resulting from higher assessments.
Other income increased primarily due to higher interest earned on money pool investments and an increase in the allowance for equity funds used during construction due to higher construction work in progress in 2026, including the Orange County Advanced Power Station project and the Lone Star Power Station project, partially offset by lower construction work in progress in 2026 on the Legend Power Station project as a result of the sale of assets related to the in-process project in December 2025. See Note 8 to the financial statements in the Form 10-K for discussion of the Entergy Texas build-to-suit lease arrangement for the Legend Power Station.
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Interest expense increased primarily due to the issuance of $425 million of 5.20% Series mortgage bonds in May 2026 and the issuance of $500 million of 5.25% Series mortgage bonds in February 2025, partially offset by lower carrying costs on the deferred fuel balance.
Income Taxes
The effective income tax rates were 18.9% for the third quarter 2026 and 18.0% for the nine months ended September 30, 2026. The differences in the effective income tax rates for the third quarter 2026 and the nine months ended September 30, 2026 versus the federal statutory rate of 21% were primarily due to book and tax differences related to the allowance for equity funds used during construction and certain book and tax differences related to utility plant items.
The effective income tax rates were 18.3% for the third quarter 2025 and 17.2% for the nine months ended September 30, 2025. The differences in the effective income tax rates for the third quarter 2025 and the nine months ended September 30, 2025 versus the federal statutory rate of 21% were primarily due to book and tax differences related to the allowance for equity funds used during construction.
Income Tax Legislation and Regulation
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Income Tax Legislation and Regulation” in the Form 10-K for discussion of income tax legislation and regulation.
Liquidity and Capital Resources
Cash Flow
Cash flows for the nine months ended September 30, 2026 and 2025 were as follows:
| 2026 | 2025 | ||||||||||
| (In Thousands) | |||||||||||
| Cash and cash equivalents at beginning of period | $275,108 | $184,997 | |||||||||
| Net cash provided by (used in): | |||||||||||
| Operating activities | 496,060 | 413,075 | |||||||||
| Investing activities | (751,848) | (1,201,029) | |||||||||
| Financing activities | 393,199 | 603,746 | |||||||||
| Net increase (decrease) in cash and cash equivalents | 137,411 | (184,208) | |||||||||
| Cash and cash equivalents at end of period | $412,519 | $789 | |||||||||
Operating Activities
Net cash flow provided by operating activities increased $83.0 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to higher collections from customers, partially offset by higher fuel and purchased power payments and the timing of payments to vendors. See Note 2 to the financial statements herein and in the Form 10-K for a discussion of fuel and purchased power cost recovery.
Investing Activities
Net cash flow used in investing activities decreased $449.2 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to a decrease of $408.2
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million in non-nuclear generation construction expenditures primarily due to lower spending on the Legend Power Station project as a result of the sale of assets related to the in-process project in December 2025 and lower spending on the Orange County Advanced Power Station project in 2026 and a decrease of $95.1 million in transmission construction expenditures primarily due to decreased spending on various transmission projects in 2026. The decrease was partially offset by proceeds of $41.4 million received in 2025 from the transfer of assets related to the Segno Solar and Votaw Solar facilities from Entergy Texas to Entergy Louisiana and money pool activity. See Note 8 to the financial statements in the Form 10-K for discussion of the Entergy Texas build-to-suit lease arrangement for the Legend Power Station.
Decreases in Entergy Texas’s receivable from the money pool are a source of cash flow, and Entergy Texas’s receivable from the money pool decreased $6.2 million for the nine months ended September 30, 2026 compared to decreasing by $18.5 million for the nine months ended September 30, 2025. The money pool is an intercompany cash management program that makes possible intercompany borrowing and lending arrangements, and the money pool and other borrowing arrangements are designed to reduce the Registrant Subsidiaries’ dependence on external short-term borrowings.
Financing Activities
Net cash flow provided by financing activities decreased $210.5 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to:
•the issuance of $500 million of 5.25% Series mortgage bonds in February 2025;
•a $248.3 million payment in June 2026 associated with a financed portion of construction work in progress related to the Orange County Advanced Power Station;
•the repayment of $130 million of 1.50% Series mortgage bonds in September 2026; and
•money pool activity.
The decrease was partially offset by the issuance of $425 million of 5.20% Series mortgage bonds in May 2026 and a capital contribution of $365 million received from Entergy Corporation in 2026 in order to maintain Entergy Texas’s capital structure and in anticipation of various capital expenditures.
Increases in Entergy Texas’s payable to the money pool are a source of cash flow, and Entergy Texas’s payable to the money pool increased by $142.2 million for the nine months ended September 30, 2025.
See Note 4 to the financial statements herein and Note 5 to the financial statements in the Form 10-K for more details on long-term debt.
Capital Structure
Entergy Texas’s debt to capital ratio is shown in the following table. The decrease in the debt to capital ratio for Entergy Texas is primarily due to a capital contribution of $365 million received from Entergy Corporation in 2026.
| September 30, 2026 | December 31, 2025 | ||||||||||
| Debt to capital | 48.4 | % | 50.9 | % | |||||||
| Effect of excluding securitization bonds | (1.2 | %) | (1.4 | %) | |||||||
| Debt to capital, excluding securitization bonds (non-GAAP) (a) | 47.2 | % | 49.5 | % | |||||||
| Effect of subtracting cash | (2.7 | %) | (1.9 | %) | |||||||
| Net debt to net capital, excluding securitization bonds (non-GAAP) (a) | 44.5 | % | 47.6 | % | |||||||
(a)Calculation excludes the securitization bonds, which are non-recourse to Entergy Texas.
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Net debt consists of debt less cash and cash equivalents. Debt consists of finance lease obligations and long-term debt, including the currently maturing portion. Capital consists of debt and equity. Net capital consists of capital less cash and cash equivalents. The debt to capital ratio excluding securitization bonds and net debt to net capital ratio excluding securitization bonds are non-GAAP measures. Entergy Texas uses the debt to capital ratios excluding securitization bonds in analyzing its financial condition and believes they provide useful information to its investors and creditors in evaluating Entergy Texas’s financial condition because the securitization bonds are non-recourse to Entergy Texas, as more fully described in Note 5 to the financial statements in the Form 10-K. Entergy Texas also uses the net debt to net capital ratio excluding securitization bonds in analyzing its financial condition and believes it provides useful information to its investors and creditors in evaluating Entergy Texas’s financial condition because net debt indicates Entergy Texas’s outstanding debt position that could not be readily satisfied by cash and cash equivalents on hand.
Uses and Sources of Capital
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Liquidity and Capital Resources” in the Form 10-K for a discussion of Entergy Texas’s uses and sources of capital. The following are updates to the information provided in the Form 10-K.
Entergy Texas is developing its capital investment plan for 2027 through 2030 and currently anticipates making the following construction and other capital investments during that period:
| 2027 | 2028 | 2029 | 2030 | ||||||||||||||||||||
| (In Millions) (a) | |||||||||||||||||||||||
| Planned construction and capital investments: | |||||||||||||||||||||||
| Generation | $320 | $1,570 | $75 | $125 | |||||||||||||||||||
| Transmission | 615 | 735 | 645 | 255 | |||||||||||||||||||
| Distribution | 420 | 370 | 340 | 340 | |||||||||||||||||||
| Utility Support | 40 | 30 | 35 | 35 | |||||||||||||||||||
| Total | $1,395 | $2,705 | $1,095 | $755 | |||||||||||||||||||
(a)Amounts exclude expenditures expected to be funded through customer advances for construction.
In addition to routine capital spending to maintain operations, the capital plan for Entergy Texas includes investments in generation projects to modernize, decarbonize, expand, and diversify Entergy Texas’s portfolio, including Lone Star Power Station and Legend Power Station; distribution and Utility support spending to improve reliability, resilience, and customer experience; transmission spending to improve reliability and resilience while also supporting customer growth and renewables expansion; and other investments. Estimated capital expenditures are subject to periodic review and modification and may vary based on the ongoing effects of regulatory constraints and requirements, governmental policies and actions, including trade-related governmental actions, such as tariffs, executive orders, and other measures, including Executive Order 14421 and the Section 232 Proclamation, environmental regulations, business opportunities, market volatility, economic trends, business restructuring, changes in project plans, and the ability to access capital, including any changes to governmental programs, such as loans, grants, guarantees, and other subsidies. Entergy Texas is not able to predict the effect of potential changes in regulation and law, changes to governmental programs, such as loans, grants, guarantees, and other subsidies, and governmental policies and actions, such as tariffs, executive orders, and other measures, including Executive Order 14421 and the Section 232 Proclamation, on its current and planned capital projects, including project delays, modifications, and cost increases.
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Entergy Texas’s receivables from or (payables to) the money pool were as follows:
| September 30, 2026 | December 31, 2025 | September 30, 2025 | December 31, 2024 | |||||||||||||||||
| (In Thousands) | ||||||||||||||||||||
| $16,291 | $22,467 | ($142,209) | $18,504 | |||||||||||||||||
See Note 4 to the financial statements in the Form 10-K for a description of the money pool.
Entergy Texas has a credit facility in the amount of $300 million scheduled to expire in June 2031. The credit facility includes fronting commitments for the issuance of letters of credit against $25 million of the borrowing capacity of the facility. As of September 30, 2026, there were no cash borrowings and $1.1 million in letters of credit outstanding under the credit facility. In addition, Entergy Texas is a party to two uncommitted letter of credit facilities as a means to post collateral to support its obligations to MISO. As of September 30, 2026, $95.1 million in letters of credit were outstanding under one of Entergy Texas’s uncommitted letter of credit facilities. See Note 4 to the financial statements herein for additional discussion of the credit facilities.
Cypress to Legend 500 kV Transmission Line
As discussed in the Form 10-K, in May 2025, Entergy Texas filed an application seeking PUCT approval to amend Entergy Texas’s certificate of convenience and necessity to construct, own, and operate a new single-circuit 500 kV transmission line. The transmission line is expected to be approximately 40 to 49 miles in length and the estimated cost of the project ranges from $392.7 million to $436.2 million, depending on the route ultimately approved by the PUCT. In June 2025 the PUCT referred the proceeding to the State Office of Administrative Hearings and a hearing on the merits was held in August 2025. In October 2025 the ALJs with the State Office of Administrative Hearings issued a proposal for decision recommending the PUCT approve Entergy Texas’s application to construct the transmission line and recommending the PUCT’s approval include selection of a specific route with an estimated cost of $398.7 million. In December 2025 the PUCT issued a final order approving the requested amendment to Entergy Texas’s certificate of convenience and necessity to construct, own, and operate the new single-circuit 500 kV transmission line, and selecting the final route previously recommended. In February 2026, landowners not party to the PUCT proceeding filed in the 345th District Court of Travis County, Texas a petition for declaratory relief and temporary and permanent injunction against the PUCT’s final order. The petition, which names the PUCT, its commissioners, and Entergy Texas as defendants, challenges Entergy Texas’s notice, the application of the PUCT’s notice rule, and the PUCT order’s approval of a route the petitioners assert was not adequately noticed. In March 2026, Entergy Texas and the PUCT filed answers disputing all aspects of the petition. In April 2026 petitioners filed an amended petition with minor adjustments to their original petition. In May 2026 petitioners filed a supplemental application for temporary injunction and opposition to pleas to the jurisdiction in response to jurisdictional defenses raised in the answers filed by Entergy Texas and the PUCT. In June 2026 the court set a hearing for July 2026 on petitioners’ requested temporary injunction and any pleas to the jurisdiction and motions for summary judgment. In June 2026 the PUCT filed its plea to the jurisdiction. In June 2026 petitioners filed a motion for summary judgment and Entergy Texas filed an amended answer addressing the amended petition, a plea to the jurisdiction, and, in the alternative, a motion for summary judgment. In July 2026 the court issued a written order granting Entergy Texas’s and the PUCT’s pleas to the jurisdiction and, in the alternative, Entergy Texas’s motion for summary judgment. In August 2026 petitioners filed a notice of appeal to the Fifteenth Court of Appeals. In October 2026 the appellate record was filed with the Fifteenth Court of Appeals, triggering a 30-day deadline for the appellants to file a brief on the merits. Also in October 2026, the appellants filed a motion for temporary relief requesting that Entergy Texas be restrained from exercising eminent domain and construction activities on the appellants’ properties. Entergy Texas expects to respond in opposition to the motion for temporary relief by the November 2026 deadline established by the court. Subject to receipt of required permits and other conditions, the project is expected to be in service by the end of 2028.
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Forest to War Eagle to Porter 138 kV Transmission Line
In August 2026, Entergy Texas filed an application seeking PUCT approval to amend Entergy Texas’s certificate of convenience and necessity to construct, own, and operate a new single-circuit 138 kV transmission line. The transmission line is expected to be approximately 9 to 11 miles in length and the estimated cost of the project ranges from $88.8 million to $99.4 million, depending on the route ultimately approved by the PUCT. Also in August 2026, the PUCT referred the proceeding to the State Office of Administrative Hearings. In September 2026 the ALJ with the State Office of Administrative Hearings adopted a procedural schedule that set a hearing for November 2026. In October 2026 the PUCT staff filed direct testimony recommending the PUCT approve Entergy Texas’s application and identifying the proposed route it concluded to best meet the statutory criteria for certification. The statutory deadline for a PUCT decision is February 2027.
State and Local Rate Regulation and Fuel-Cost Recovery
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - State and Local Rate Regulation and Fuel-Cost Recovery” in the Form 10-K for a discussion of state and local rate regulation and fuel-cost recovery. The following are updates to that discussion.
Retail Rates
Distribution Cost Recovery Factor (DCRF) Rider
In April 2026, Entergy Texas filed with the PUCT a request to amend its DCRF rider. The amended rider was designed to collect from Entergy Texas’s retail customers approximately $112.5 million annually, or $20.4 million in incremental annual revenues beyond Entergy Texas’s then-effective DCRF rider based on its capital invested in distribution between July 1, 2025 and December 31, 2025. In July 2026 the PUCT approved the DCRF rider, consistent with Entergy Texas’s as-filed request, and rates became effective for usage on and after July 8, 2026.
In September 2026, Entergy Texas filed with the PUCT a request to amend its DCRF rider. The proposed rider is designed to collect from Entergy Texas’s retail customers approximately $127.3 million annually, or $14.8 million in incremental annual revenues beyond Entergy Texas’s currently effective DCRF rider based on its capital invested in distribution between January 1, 2026 and June 30, 2026. In September 2026 the ALJ with the State Office of Administrative Hearings adopted a procedural schedule requiring the PUCT staff to file a recommendation on the merits of Entergy Texas’s application by November 2, 2026.
Transmission Cost Recovery Factor (TCRF) Rider
As discussed in the Form 10-K, in October 2025, Entergy Texas filed with the PUCT a request to amend its TCRF rider. The amended rider was designed to collect from Entergy Texas’s retail customers approximately $30.3 million annually, or $20.6 million in incremental annual revenues beyond Entergy Texas’s then-effective TCRF rider based on its capital invested in transmission between July 1, 2024 and June 30, 2025 and changes in other transmission charges. In April 2026 the PUCT approved the TCRF rider, consistent with Entergy Texas’s as-filed request, and rates became effective for usage on and after April 6, 2026.
In October 2026, Entergy Texas filed with the PUCT a request to amend its TCRF rider. The proposed rider is designed to collect from Entergy Texas’s retail customers approximately $56.7 million annually, or $26.4 million in incremental annual revenues beyond Entergy Texas’s currently effective TCRF rider based on its capital invested in transmission between July 1, 2025 and June 30, 2026 and changes in other transmission charges.
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Generation Cost Recovery Rider
In March 2026, Entergy Texas filed an application to establish a generation cost recovery rider to begin recovering a return of and on its capital investment in the Orange County Advanced Power Station. The proposed generation cost recovery rider, which includes Entergy Texas’s capital invested in generation for the Orange County Advanced Power Station through December 31, 2025, was designed to collect approximately $150.4 million annually from Entergy Texas’s retail customers. In July 2026 the ALJ with the State Office of Administrative Hearings approved a proposed procedural schedule that included a hearing on the merits in September 2026 and provided for interim rates to become effective for usage on and after the Orange County Advanced Power Station in-service date, to the extent final rates were not in place by that time. In September 2026, Entergy Texas filed, and the ALJ with the State Office of Administrative Hearings granted, a joint motion to abate the procedural schedule and cancel the hearing on the merits to give the parties to the proceeding additional time to finalize a settlement. Interim rates became effective when the Orange County Advanced Power Station was placed into service in October 2026. Also in October 2026, Entergy Texas filed an unopposed stipulation resolving all issues in case, supporting testimony, a joint motion to adjust the interim rates previously implemented to correspond to the stipulated revenue requirement, and a joint motion to admit evidence and remand the proceeding to the PUCT. The unopposed stipulation would result in no disallowance of recoverable investment but would reduce the annual revenue requirement collected through the generation cost recovery rider by $5.7 million while the rider remains in effect. The PUCT is expected to issue a final order on the settlement by the end of 2026.
Fuel and purchased power cost recovery
In September 2026, Entergy Texas filed an application with the PUCT to reconcile its fuel and purchased power costs for the period from April 2024 through March 2026. During the reconciliation period, Entergy Texas incurred approximately $1.2 billion in eligible fuel and purchased power expenses to generate and purchase electricity to serve its customers, net of certain revenues credited to such expenses and other adjustments. Entergy Texas’s cumulative over-recovery balance for the reconciliation period was approximately $90.1 million, including interest, which Entergy Texas requested authority to carry over as part of the cumulative fuel balance for the subsequent reconciliation period beginning April 2026.
Capacity Cost Recovery Rider (CCRR)
In May 2026, Entergy Texas filed with the PUCT a request to establish a new CCRR. The new CCRR was designed to collect approximately $58 million annually from Entergy Texas’s retail customers based on Entergy Texas’s eligible capacity-related costs and revenues for the 12 months beginning June 1, 2026. The eligible capacity-related costs and revenues are associated with Entergy Texas’s participation in MISO’s annual planning resource auction. In July 2026 the PUCT approved the CCRR, consistent with Entergy Texas’s as-filed request, and rates became effective on July 10, 2026.
Frontier Power Purchase Agreement
In June 2026, Entergy Texas filed an application for PUCT pre-approval of a long-term 14-year PPA for 300 MW of capacity and energy from the Tenaska Frontier Generating Station, an 830 MW natural gas-fired combined-cycle combustion turbine plant in Grimes County, Texas. As a result of accelerated load growth in Texas and other factors in Entergy Texas’s service territory, Entergy Texas has a significant near- and long-term need for capacity and energy to serve its customers. Within the application, Entergy Texas requested the PUCT find that the PPA will satisfy Entergy Texas’s identified reliability needs in allowing for cost recovery of the associated purchased power. The 14-year PPA has a total estimated cost of $883 million. In September 2026 the ALJ with the State Office of Administrative Hearings adopted a procedural schedule with a hearing on the merits scheduled in October 2026. In October 2026, Entergy Texas filed on behalf of the parties a joint motion to abate the procedural schedule noting that the parties had reached a settlement in principle and the ALJ with the State Office of Administrative Hearings approved the joint motion to allow the parties time to finalize the settlement.
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Industrial and Commercial Customers
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS – Industrial and Commercial Customers” in the Form 10-K for a discussion of industrial and commercial customers.
Federal Regulation
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS – Federal Regulation” in the Form 10-K and Note 2 to the financial statements herein and in the Form 10-K for a discussion of federal regulation.
Nuclear Matters
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Nuclear Matters” in the Form 10-K for a discussion of nuclear matters.
Environmental Risks
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Environmental Risks” in the Form 10-K for a discussion of environmental risks.
Critical Accounting Estimates
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Critical Accounting Estimates” in the Form 10-K for a discussion of the estimates and judgments necessary in Entergy Texas’s accounting for utility regulatory accounting, taxation and uncertain tax positions, qualified pension and other postretirement benefits, and other contingencies.
New Accounting Pronouncements
See the “New Accounting Pronouncements” section of Note 1 to the financial statements in the Form 10-K for a discussion of new accounting pronouncements and the “New Accounting Pronouncements” section of Entergy Corporation and Subsidiaries Management’s Financial Discussion and Analysis herein for updates to the discussion of new accounting pronouncements.
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| ENTERGY TEXAS, INC. AND SUBSIDIARIES | ||||||||||||||||||||||||||
| CONSOLIDATED INCOME STATEMENTS | ||||||||||||||||||||||||||
| For the Three and Nine Months Ended September 30, 2026 and 2025 | ||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||
| (In Thousands) | (In Thousands) | |||||||||||||||||||||||||
| OPERATING REVENUES | ||||||||||||||||||||||||||
| Electric | $ | $ | $ | $ | ||||||||||||||||||||||
| OPERATING EXPENSES | ||||||||||||||||||||||||||
| Operation and Maintenance: | ||||||||||||||||||||||||||
| Fuel, fuel-related expenses, and gas purchased for resale | ||||||||||||||||||||||||||
| Purchased power | ||||||||||||||||||||||||||
| Other operation and maintenance | ||||||||||||||||||||||||||
| Taxes other than income taxes | ||||||||||||||||||||||||||
| Depreciation and amortization | ||||||||||||||||||||||||||
| Other regulatory charges (credits) - net | ||||||||||||||||||||||||||
| TOTAL | ||||||||||||||||||||||||||
| OPERATING INCOME | ||||||||||||||||||||||||||
| OTHER INCOME | ||||||||||||||||||||||||||
| Allowance for equity funds used during construction | ||||||||||||||||||||||||||
| Interest and investment income | ||||||||||||||||||||||||||
| Miscellaneous - net | ( | ( | ( | |||||||||||||||||||||||
| TOTAL | ||||||||||||||||||||||||||
| INTEREST EXPENSE | ||||||||||||||||||||||||||
| Interest expense | ||||||||||||||||||||||||||
| Allowance for borrowed funds used during construction | ( | ( | ( | ( | ||||||||||||||||||||||
| TOTAL | ||||||||||||||||||||||||||
| INCOME BEFORE INCOME TAXES | ||||||||||||||||||||||||||
| Income taxes | ||||||||||||||||||||||||||
| NET INCOME | ||||||||||||||||||||||||||
| Preferred dividend requirements | ||||||||||||||||||||||||||
| EARNINGS APPLICABLE TO COMMON STOCK | $ | $ | $ | $ | ||||||||||||||||||||||
| See Notes to Financial Statements. | ||||||||||||||||||||||||||
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| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||
| For the Nine Months Ended September 30, 2026 and 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| OPERATING ACTIVITIES | ||||||||||||||
| Net income | $ | $ | ||||||||||||
| Adjustments to reconcile net income to net cash flow provided by operating activities: | ||||||||||||||
| Depreciation and amortization | ||||||||||||||
| Deferred income taxes, tax credits, and non-current taxes accrued | ||||||||||||||
| Changes in assets and liabilities: | ||||||||||||||
| Receivables | ( | ( | ||||||||||||
| Fuel inventory | ||||||||||||||
| Accounts payable | ||||||||||||||
| Taxes accrued | ( | ( | ||||||||||||
| Interest accrued | ( | ( | ||||||||||||
| Deferred fuel costs | ( | ( | ||||||||||||
| Other working capital accounts | ( | ( | ||||||||||||
| Provisions for estimated losses | ( | |||||||||||||
| Other regulatory assets | ( | |||||||||||||
| Other regulatory liabilities | ( | |||||||||||||
| Pension and other postretirement funded status | ( | ( | ||||||||||||
| Other assets and liabilities | ( | ( | ||||||||||||
| Net cash flow provided by operating activities | ||||||||||||||
| INVESTING ACTIVITIES | ||||||||||||||
| Construction expenditures | ( | ( | ||||||||||||
| Allowance for equity funds used during construction | ||||||||||||||
| Proceeds from sale of assets | ||||||||||||||
| Changes in money pool receivable - net | ||||||||||||||
| Changes in securitization account | ( | ( | ||||||||||||
| Net cash flow used in investing activities | ( | ( | ||||||||||||
| FINANCING ACTIVITIES | ||||||||||||||
| Proceeds from the issuance of long-term debt | ||||||||||||||
| Retirement of long-term debt | ( | ( | ||||||||||||
| Repayment of accrued construction expenditures | ( | |||||||||||||
| Capital contribution from parent | ||||||||||||||
| Change in money pool payable - net | ||||||||||||||
| Preferred stock dividends paid | ( | ( | ||||||||||||
| Other | ( | ( | ||||||||||||
| Net cash flow provided by financing activities | ||||||||||||||
| Net increase (decrease) in cash and cash equivalents | ( | |||||||||||||
| Cash and cash equivalents at beginning of period | ||||||||||||||
| Cash and cash equivalents at end of period | $ | $ | ||||||||||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||||||||||||||
| Cash paid (received) during the period for: | ||||||||||||||
| Interest - net of amount capitalized | $ | $ | ||||||||||||
| Income taxes - net | ($ | $ | ||||||||||||
| Noncash investing activities: | ||||||||||||||
| Accrued construction expenditures | $ | $ | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| CONSOLIDATED BALANCE SHEETS | ||||||||||||||
| ASSETS | ||||||||||||||
| September 30, 2026 and December 31, 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| CURRENT ASSETS | ||||||||||||||
| Cash and cash equivalents: | ||||||||||||||
| Cash | $ | $ | ||||||||||||
| Temporary cash investments | ||||||||||||||
| Total cash and cash equivalents | ||||||||||||||
| Securitization recovery trust account | ||||||||||||||
| Accounts receivable: | ||||||||||||||
| Customer | ||||||||||||||
| Allowance for doubtful accounts | ( | ( | ||||||||||||
| Associated companies | ||||||||||||||
| Other | ||||||||||||||
| Accrued unbilled revenues | ||||||||||||||
| Total accounts receivable | ||||||||||||||
| Deferred fuel costs | ||||||||||||||
| Fuel inventory - at average cost | ||||||||||||||
| Materials and supplies | ||||||||||||||
| Prepayments and other | ||||||||||||||
| TOTAL | ||||||||||||||
| OTHER PROPERTY AND INVESTMENTS | ||||||||||||||
| Investments in affiliates - at equity | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| UTILITY PLANT | ||||||||||||||
| Electric | ||||||||||||||
| Construction work in progress | ||||||||||||||
| TOTAL UTILITY PLANT | ||||||||||||||
| Less - accumulated depreciation and amortization | ||||||||||||||
| UTILITY PLANT - NET | ||||||||||||||
| DEFERRED DEBITS AND OTHER ASSETS | ||||||||||||||
| Regulatory assets: | ||||||||||||||
Other regulatory assets (includes securitization property of $ | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| TOTAL ASSETS | $ | $ | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| ENTERGY TEXAS, INC. AND SUBSIDIARIES | ||||||||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||||||||
| LIABILITIES AND EQUITY | ||||||||||||||
| September 30, 2026 and December 31, 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| CURRENT LIABILITIES | ||||||||||||||
| Currently maturing long-term debt | $ | $ | ||||||||||||
| Accounts payable: | ||||||||||||||
| Associated companies | ||||||||||||||
| Other | ||||||||||||||
| Customer deposits | ||||||||||||||
| Taxes accrued | ||||||||||||||
| Interest accrued | ||||||||||||||
| Deferred fuel costs | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| NON-CURRENT LIABILITIES | ||||||||||||||
| Accumulated deferred income taxes and taxes accrued | ||||||||||||||
| Accumulated deferred investment tax credits | ||||||||||||||
| Regulatory liability for income taxes - net | ||||||||||||||
| Other regulatory liabilities | ||||||||||||||
| Asset retirement cost liabilities | ||||||||||||||
| Accumulated provisions | ||||||||||||||
Long-term debt (includes securitization bonds of $ | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| Commitments and Contingencies | ||||||||||||||
| EQUITY | ||||||||||||||
Common stock, | ||||||||||||||
| Paid-in capital | ||||||||||||||
| Retained earnings | ||||||||||||||
| Total common shareholder's equity | ||||||||||||||
| Preferred stock without sinking fund | ||||||||||||||
| TOTAL | ||||||||||||||
| TOTAL LIABILITIES AND EQUITY | $ | $ | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| ENTERGY TEXAS, INC. AND SUBSIDIARIES | |||||||||||||||||||||||||||||
| CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY | |||||||||||||||||||||||||||||
| For the Nine Months Ended September 30, 2026 and 2025 | |||||||||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||||||
| Common Equity | |||||||||||||||||||||||||||||
| Preferred Stock | Common Stock | Paid-in Capital | Retained Earnings | Total | |||||||||||||||||||||||||
| (In Thousands) | |||||||||||||||||||||||||||||
| Balance at December 31, 2024 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| Net income | — | — | — | ||||||||||||||||||||||||||
| Preferred stock dividends | — | — | — | ( | ( | ||||||||||||||||||||||||
| Balance at March 31, 2025 | |||||||||||||||||||||||||||||
| Net income | — | — | — | ||||||||||||||||||||||||||
| Preferred stock dividends | — | — | — | ( | ( | ||||||||||||||||||||||||
| Balance at June 30, 2025 | |||||||||||||||||||||||||||||
| Net income | — | — | — | ||||||||||||||||||||||||||
| Preferred stock dividends | — | — | — | ( | ( | ||||||||||||||||||||||||
| Balance at September 30, 2025 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| Balance at December 31, 2025 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| Net income | — | — | — | ||||||||||||||||||||||||||
| Capital contribution from parent | |||||||||||||||||||||||||||||
| Preferred stock dividends | — | — | — | ( | ( | ||||||||||||||||||||||||
| Balance at March 31, 2026 | |||||||||||||||||||||||||||||
| Net income | — | — | — | ||||||||||||||||||||||||||
| Preferred stock dividends | — | — | — | ( | ( | ||||||||||||||||||||||||
| Balance at June 30, 2026 | |||||||||||||||||||||||||||||
| Net income | — | — | — | ||||||||||||||||||||||||||
| Preferred stock dividends | — | — | — | ( | ( | ||||||||||||||||||||||||
| Balance at September 30, 2026 | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| See Notes to Financial Statements. | |||||||||||||||||||||||||||||
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Table of Contents
SYSTEM ENERGY RESOURCES, INC.
MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS
System Energy’s principal asset consists of an ownership interest and a leasehold interest in Grand Gulf. The capacity and energy from its 90% interest is sold under the Unit Power Sales Agreement to its only three customers, Entergy Arkansas, Entergy Mississippi, and Entergy New Orleans. System Energy’s operating revenues are derived from the allocation of the capacity, energy, and related costs associated with its 90% interest in Grand Gulf pursuant to the Unit Power Sales Agreement. Payments under the Unit Power Sales Agreement are System Energy’s only source of operating revenues.
Results of Operations
Net Income
Third Quarter 2026 Compared to Third Quarter 2025
Net income increased $1.7 million primarily due to higher operating revenues resulting from changes in rate base.
Nine Months Ended September 30, 2026 Compared to Nine Months Ended September 30, 2025
Net income increased $3.4 million primarily due to higher operating revenues resulting from changes in rate base.
Income Taxes
The effective income tax rates were 16.8% for the third quarter 2026 and 16.7% for the nine months ended September 30, 2026. The differences in the effective income tax rates for the third quarter 2026 and the nine months ended September 30, 2026 versus the federal statutory rate of 21% were primarily due to certain book and tax differences related to utility plant items, book and tax differences related to the allowance for equity funds used during construction, and the amortization of investment tax credits, partially offset by the accrual for state income taxes.
The effective income tax rate was 21.1% for the third quarter 2025. The difference in the effective income tax rate for the third quarter 2025 versus the federal statutory rate of 21% was primarily due to the accrual for state income taxes, substantially offset by certain book and tax differences related to utility plant items and book and tax differences related to the allowance for equity funds used during construction.
The effective income tax rate was 20.6% for the nine months ended September 30, 2025. The difference in the effective income tax rate for the nine months ended September 30, 2025 versus the federal statutory rate of 21% was primarily due to certain book and tax differences related to utility plant items and book and tax differences related to the allowance for equity funds used during construction, substantially offset by the accrual for state income taxes.
Income Tax Legislation and Regulation
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Income Tax Legislation and Regulation” in the Form 10-K for discussion of income tax legislation and regulation.
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Table of Contents
System Energy Resources, Inc.
Management’s Financial Discussion and Analysis
Liquidity and Capital Resources
Cash Flow
Cash flows for the nine months ended September 30, 2026 and 2025 were as follows:
| 2026 | 2025 | ||||||||||
| (In Thousands) | |||||||||||
| Cash and cash equivalents at beginning of period | $56 | $28,908 | |||||||||
| Net cash provided by (used in): | |||||||||||
| Operating activities | 255,537 | 327,440 | |||||||||
| Investing activities | (253,926) | (146,126) | |||||||||
| Financing activities | 29,792 | (82,435) | |||||||||
| Net increase in cash and cash equivalents | 31,403 | 98,879 | |||||||||
| Cash and cash equivalents at end of period | $31,459 | $127,787 | |||||||||
Operating Activities
Net cash flow provided by operating activities decreased $71.9 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to an increase of $30.3 million in spending on nuclear refueling outage costs in 2026 as compared to 2025 and the receipt of $68.8 million in proceeds from the transfer of 2025 nuclear production tax credits to third parties in 2026 as compared to the receipt of $98.7 million in proceeds from the transfer of 2024 nuclear production tax credits to third parties in 2025. See Note 10 to the financial statements herein and Note 3 to the financial statements in the Form 10-K for discussion of the nuclear production tax credits.
Investing Activities
Net cash flow used in investing activities increased $107.8 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to an increase of $108.2 million in cash used as a result of fluctuations in nuclear fuel activity due to variations from year to year in the timing and pricing of fuel reload requirements, material and services deliveries, and the timing of cash payments during the nuclear fuel cycle and an increase of $49.2 million in nuclear construction expenditures primarily due to higher spending in 2026 on Grand Gulf outage projects and upgrades. The increase was partially offset by money pool activity and a decrease of $17.1 million in decommissioning trust fund investment activity.
Increases in System Energy’s receivable from the money pool are a use of cash flow, and System Energy’s receivable from the money pool increased $1.2 million for the nine months ended September 30, 2026 compared to increasing by $30.3 million for the nine months ended September 30, 2025. The money pool is an intercompany cash management program that makes possible intercompany borrowing and lending arrangements, and the money pool and other borrowing arrangements are designed to reduce the Registrant Subsidiaries’ dependence on external short-term borrowings.
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Table of Contents
System Energy Resources, Inc.
Management’s Financial Discussion and Analysis
Financing Activities
System Energy’s financing activities provided $29.8 million of cash for the nine months ended September 30, 2026 compared to using $82.4 million of cash for the nine months ended September 30, 2025 primarily due to the following activity:
•the issuance of $80 million of 5.28% Series L notes by the System Energy nuclear fuel company variable interest entity in January 2026;
•a decrease of $45 million in common stock dividends and distributions paid in 2026 in order to maintain System Energy’s capital structure;
•net long-term borrowings of $1.5 million in 2026 compared to net repayments of $33.1 million in 2025 on the nuclear fuel company variable interest entity’s credit facility;
•the repayment, prior to maturity, of $200 million of 2.14% Series mortgage bonds in June 2025;
•the issuance of $240 million of 5.30% Series mortgage bonds in May 2025; and
•money pool activity.
Decreases in System Energy’s payable to the money pool are a use of cash flow, and System Energy’s payable to the money pool decreased $16.3 million for the nine months ended September 30, 2026.
See Note 4 to the financial statements herein and Note 5 to the financial statements in the Form 10-K for more details on long-term debt.
Capital Structure
System Energy’s debt to capital ratio is shown in the following table. The increase in the debt to capital ratio for System Energy is primarily due to the net issuance of long-term debt in 2026.
| September 30, 2026 | December 31, 2025 | ||||||||||
| Debt to capital | 54.2 | % | 53.1 | % | |||||||
| Effect of subtracting cash | (0.7 | %) | — | % | |||||||
| Net debt to net capital (non-GAAP) | 53.5 | % | 53.1 | % | |||||||
Net debt consists of debt less cash and cash equivalents. Debt consists of short-term borrowings and long-term debt, including the currently maturing portion. Capital consists of debt and common equity. Net capital consists of capital less cash and cash equivalents. System Energy uses the debt to capital ratio in analyzing its financial condition and believes it provides useful information to its investors and creditors in evaluating System Energy’s financial condition. The net debt to net capital ratio is a non-GAAP measure. System Energy also uses the net debt to net capital ratio in analyzing its financial condition and believes it provides useful information to its investors and creditors in evaluating System Energy’s financial condition because net debt indicates System Energy’s outstanding debt position that could not be readily satisfied by cash and cash equivalents on hand.
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System Energy Resources, Inc.
Management’s Financial Discussion and Analysis
Uses and Sources of Capital
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Liquidity and Capital Resources” in the Form 10-K for a discussion of System Energy’s uses and sources of capital. The following are updates to the information provided in the Form 10-K.
System Energy is developing its capital investment plan for 2027 through 2030 and currently anticipates making the following construction and other capital investments during that period:
| 2027 | 2028 | 2029 | 2030 | ||||||||||||||||||||
| (In Millions) | |||||||||||||||||||||||
| Planned construction and capital investments: | |||||||||||||||||||||||
| Generation | $105 | $160 | $175 | $200 | |||||||||||||||||||
| Utility Support | 10 | 10 | 30 | 15 | |||||||||||||||||||
| Total | $115 | $170 | $205 | $215 | |||||||||||||||||||
In addition to routine capital spending to maintain operations, the capital plan for System Energy includes amounts associated with Grand Gulf investments and initiatives. Estimated capital expenditures are subject to periodic review and modification and may vary based on the ongoing effects of regulatory constraints and requirements, governmental policies and actions, including trade-related governmental actions, such as tariffs, executive orders, and other measures, including Executive Order 14421 and the Section 232 Proclamation, environmental regulations, business opportunities, market volatility, economic trends, business restructuring, changes in project plans, and the ability to access capital, including any changes to governmental programs, such as loans, grants, guarantees, and other subsidies. System Energy is not able to predict the effect of potential changes in regulation and law, changes to governmental programs, such as loans, grants, guarantees, and other subsidies, and governmental policies and actions, such as tariffs, executive orders, and other measures, including Executive Order 14421 and the Section 232 Proclamation, on its current and planned capital projects, including project delays, modifications, and cost increases.
System Energy’s receivables from or (payables to) the money pool were as follows:
| September 30, 2026 | December 31, 2025 | September 30, 2025 | December 31, 2024 | |||||||||||||||||
| (In Thousands) | ||||||||||||||||||||
| $1,238 | ($16,299) | $33,179 | $2,851 | |||||||||||||||||
See Note 4 to the financial statements in the Form 10-K for a description of the money pool.
The System Energy nuclear fuel company variable interest entity has a credit facility in the amount of $120 million scheduled to expire in June 2029. As of September 30, 2026, $37.9 million in loans were outstanding under the System Energy nuclear fuel company variable interest entity credit facility. See Note 4 to the financial statements herein for additional discussion of the variable interest entity credit facility.
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Table of Contents
System Energy Resources, Inc.
Management’s Financial Discussion and Analysis
Federal Regulation
See the “Rate, Cost-recovery, and Other Regulation - Federal Regulation” section of Entergy Corporation and Subsidiaries Management’s Financial Discussion and Analysis in the Form 10-K and Note 2 to the financial statements herein and in the Form 10-K for a discussion of federal regulation. The following is an update to that discussion.
Unit Power Sales Agreement
See Note 2 to the financial statements in the Form 10-K for discussion of the Unit Power Sales Agreement. The following is an update to that discussion.
Pension Costs Amendment Proceeding
As discussed in the Form 10-K, in October 2021, System Energy submitted to the FERC proposed amendments to the Unit Power Sales Agreement to include in rate base the prepaid and accrued pension costs associated with System Energy’s qualified pension plans. In November 2025 the FERC issued an order approving System Energy’s proposed prepaid and accrued pension recovery mechanism. System Energy has been utilizing this methodology in billings since December 1, 2022 and will continue to utilize it going forward. As a result of the FERC’s order, System Energy did not owe any refunds. In December 2025 the APSC filed a request for rehearing of the November 2025 order. In January 2026 the FERC denied the APSC’s rehearing request by operation of law. In May 2026 the FERC issued a follow-up substantive order denying the APSC’s rehearing and sustaining its finding that no refunds are owed.
Nuclear Matters
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS – Nuclear Matters” in the Form 10-K for a discussion of nuclear matters. The following is an update to that discussion.
NRC Reactor Oversight Process
The NRC’s Reactor Oversight Process is a program to collect information about plant performance, assess the information for its safety significance, and provide for appropriate licensee and NRC response. The NRC evaluates plant performance by analyzing two distinct inputs: inspection findings resulting from the NRC’s inspection program and performance indicators reported by the licensee. The evaluations result in the placement of each plant in one of the NRC’s Reactor Oversight Process Action Matrix columns: “licensee response column,” or Column 1, “regulatory response column,” or Column 2, “degraded cornerstone column,” or Column 3, “multiple/repetitive degraded cornerstone column,” or Column 4, and “unacceptable performance,” or Column 5. Plants in Column 1 are subject to normal NRC inspection activities. Plants in Column 2, Column 3, or Column 4 are subject to progressively increasing levels of inspection by the NRC with, in general, progressively increasing levels of associated costs. Continued plant operation is not permitted for plants in Column 5. Grand Gulf is currently in Column 2.
In April 2026 the NRC issued a final significance determination and notice of violation for Grand Gulf, in which it finalized a “white” finding with “low safety significance” related to one of Grand Gulf’s emergency diesel generators, resulting in Grand Gulf’s placement in Column 2, effective first quarter 2026. In September 2026, Grand Gulf successfully completed an NRC supplemental inspection related to the emergency diesel generator issue. The NRC is expected to issue an inspection report in fourth quarter 2026 documenting Grand Gulf’s return to Column 1, effective third quarter 2026.
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System Energy Resources, Inc.
Management’s Financial Discussion and Analysis
Environmental Risks
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS – Environmental Risks” in the Form 10-K for a discussion of environmental risks.
Critical Accounting Estimates
See “MANAGEMENT’S FINANCIAL DISCUSSION AND ANALYSIS - Critical Accounting Estimates” in the Form 10-K for a discussion of the estimates and judgments necessary in System Energy’s accounting for nuclear decommissioning costs, utility regulatory accounting, taxation and uncertain tax positions, qualified pension and other postretirement benefits, and other contingencies.
New Accounting Pronouncements
See the “New Accounting Pronouncements” section of Note 1 to the financial statements in the Form 10-K for a discussion of new accounting pronouncements and the “New Accounting Pronouncements” section of Entergy Corporation and Subsidiaries Management’s Financial Discussion and Analysis herein for updates to the discussion of new accounting pronouncements.
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| SYSTEM ENERGY RESOURCES, INC. | ||||||||||||||||||||||||||
| INCOME STATEMENTS | ||||||||||||||||||||||||||
| For the Three and Nine Months Ended September 30, 2026 and 2025 | ||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||
| (In Thousands) | (In Thousands) | |||||||||||||||||||||||||
| OPERATING REVENUES | ||||||||||||||||||||||||||
| Electric | $ | $ | $ | $ | ||||||||||||||||||||||
| OPERATING EXPENSES | ||||||||||||||||||||||||||
| Operation and Maintenance: | ||||||||||||||||||||||||||
| Fuel, fuel-related expenses, and gas purchased for resale | ||||||||||||||||||||||||||
| Nuclear refueling outage expenses | ||||||||||||||||||||||||||
| Other operation and maintenance | ||||||||||||||||||||||||||
| Decommissioning | ||||||||||||||||||||||||||
| Taxes other than income taxes | ||||||||||||||||||||||||||
| Depreciation and amortization | ||||||||||||||||||||||||||
| Other regulatory charges (credits) - net | ||||||||||||||||||||||||||
| TOTAL | ||||||||||||||||||||||||||
| OPERATING INCOME | ||||||||||||||||||||||||||
| OTHER INCOME | ||||||||||||||||||||||||||
| Allowance for equity funds used during construction | ||||||||||||||||||||||||||
| Interest and investment income | ||||||||||||||||||||||||||
| Miscellaneous - net | ( | ( | ||||||||||||||||||||||||
| TOTAL | ||||||||||||||||||||||||||
| INTEREST EXPENSE | ||||||||||||||||||||||||||
| Interest expense | ||||||||||||||||||||||||||
| Allowance for borrowed funds used during construction | ( | ( | ( | ( | ||||||||||||||||||||||
| TOTAL | ||||||||||||||||||||||||||
| INCOME BEFORE INCOME TAXES | ||||||||||||||||||||||||||
| Income taxes | ||||||||||||||||||||||||||
| NET INCOME | $ | $ | $ | $ | ||||||||||||||||||||||
| See Notes to Financial Statements. | ||||||||||||||||||||||||||
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| SYSTEM ENERGY RESOURCES, INC. | ||||||||||||||
| STATEMENTS OF CASH FLOWS | ||||||||||||||
| For the Nine Months Ended September 30, 2026 and 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| OPERATING ACTIVITIES | ||||||||||||||
| Net income | $ | $ | ||||||||||||
| Adjustments to reconcile net income to net cash flow provided by operating activities: | ||||||||||||||
| Depreciation, amortization, and decommissioning, including nuclear fuel amortization | ||||||||||||||
| Deferred income taxes, tax credits, and non-current taxes accrued | ||||||||||||||
| Changes in assets and liabilities: | ||||||||||||||
| Receivables | ( | |||||||||||||
| Accounts payable | ( | ( | ||||||||||||
| Taxes accrued | ( | ( | ||||||||||||
| Interest accrued | ||||||||||||||
| Other working capital accounts | ( | ( | ||||||||||||
| Other regulatory assets | ( | |||||||||||||
| Other regulatory liabilities | ( | |||||||||||||
Pension and other postretirement funded status | ( | ( | ||||||||||||
| Other assets and liabilities | ( | ( | ||||||||||||
| Net cash flow provided by operating activities | ||||||||||||||
| INVESTING ACTIVITIES | ||||||||||||||
| Construction expenditures | ( | ( | ||||||||||||
| Allowance for equity funds used during construction | ||||||||||||||
| Nuclear fuel purchases | ( | ( | ||||||||||||
| Proceeds from sale of nuclear fuel | ||||||||||||||
| Proceeds from nuclear decommissioning trust fund sales | ||||||||||||||
| Investment in nuclear decommissioning trust funds | ( | ( | ||||||||||||
| Changes in money pool receivable - net | ( | ( | ||||||||||||
| Net cash flow used in investing activities | ( | ( | ||||||||||||
| FINANCING ACTIVITIES | ||||||||||||||
| Proceeds from the issuance of long-term debt | ||||||||||||||
| Retirement of long-term debt | ( | ( | ||||||||||||
| Change in money pool payable - net | ( | |||||||||||||
| Common stock dividends and distributions paid | ( | ( | ||||||||||||
| Other | ( | |||||||||||||
| Net cash flow provided by (used in) financing activities | ( | |||||||||||||
| Net increase in cash and cash equivalents | ||||||||||||||
| Cash and cash equivalents at beginning of period | ||||||||||||||
| Cash and cash equivalents at end of period | $ | $ | ||||||||||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||||||||||||||
| Cash paid (received) during the period for: | ||||||||||||||
| Interest - net of amount capitalized | $ | $ | ||||||||||||
Income taxes - net (includes proceeds from the transfer of production tax credits to third parties of $ | ($ | ($ | ||||||||||||
| Noncash investing activities: | ||||||||||||||
| Accrued construction expenditures | $ | $ | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| SYSTEM ENERGY RESOURCES, INC. | ||||||||||||||
| BALANCE SHEETS | ||||||||||||||
| ASSETS | ||||||||||||||
| September 30, 2026 and December 31, 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| CURRENT ASSETS | ||||||||||||||
| Cash and cash equivalents: | ||||||||||||||
| Cash | $ | $ | ||||||||||||
| Temporary cash investments | ||||||||||||||
| Total cash and cash equivalents | ||||||||||||||
| Accounts receivable: | ||||||||||||||
| Associated companies | ||||||||||||||
| Other | ||||||||||||||
| Total accounts receivable | ||||||||||||||
| Materials and supplies | ||||||||||||||
| Deferred nuclear refueling outage costs | ||||||||||||||
| Prepayments and other | ||||||||||||||
| TOTAL | ||||||||||||||
| OTHER PROPERTY AND INVESTMENTS | ||||||||||||||
| Decommissioning trust funds | ||||||||||||||
| TOTAL | ||||||||||||||
| UTILITY PLANT | ||||||||||||||
| Electric | ||||||||||||||
| Construction work in progress | ||||||||||||||
| Nuclear fuel | ||||||||||||||
| TOTAL UTILITY PLANT | ||||||||||||||
| Less - accumulated depreciation and amortization | ||||||||||||||
| UTILITY PLANT - NET | ||||||||||||||
| DEFERRED DEBITS AND OTHER ASSETS | ||||||||||||||
| Regulatory assets: | ||||||||||||||
| Other regulatory assets | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| TOTAL ASSETS | $ | $ | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| SYSTEM ENERGY RESOURCES, INC. | ||||||||||||||
| BALANCE SHEETS | ||||||||||||||
| LIABILITIES AND EQUITY | ||||||||||||||
| September 30, 2026 and December 31, 2025 | ||||||||||||||
| (Unaudited) | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| (In Thousands) | ||||||||||||||
| CURRENT LIABILITIES | ||||||||||||||
| Currently maturing long-term debt | $ | $ | ||||||||||||
| Accounts payable: | ||||||||||||||
| Associated companies | ||||||||||||||
| Other | ||||||||||||||
| Taxes accrued | ||||||||||||||
| Interest accrued | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| NON-CURRENT LIABILITIES | ||||||||||||||
| Accumulated deferred income taxes and taxes accrued | ||||||||||||||
| Accumulated deferred investment tax credits | ||||||||||||||
| Regulatory liability for income taxes - net | ||||||||||||||
| Other regulatory liabilities | ||||||||||||||
| Decommissioning | ||||||||||||||
| Long-term debt | ||||||||||||||
| Other | ||||||||||||||
| TOTAL | ||||||||||||||
| Commitments and Contingencies | ||||||||||||||
| COMMON EQUITY | ||||||||||||||
Common stock, | ||||||||||||||
| Retained earnings | ||||||||||||||
| TOTAL | ||||||||||||||
| TOTAL LIABILITIES AND EQUITY | $ | $ | ||||||||||||
| See Notes to Financial Statements. | ||||||||||||||
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| SYSTEM ENERGY RESOURCES, INC. | |||||||||||||||||
| STATEMENTS OF CHANGES IN COMMON EQUITY | |||||||||||||||||
| For the Nine Months Ended September 30, 2026 and 2025 | |||||||||||||||||
| (Unaudited) | |||||||||||||||||
| Common Stock | Retained Earnings | Total | |||||||||||||||
| (In Thousands) | |||||||||||||||||
| Balance at December 31, 2024 | $ | $ | $ | ||||||||||||||
| Net income | — | ||||||||||||||||
| Common stock dividends and distributions | ( | ( | ( | ||||||||||||||
| Balance at March 31, 2025 | |||||||||||||||||
| Net income | — | ||||||||||||||||
| Common stock dividends and distributions | ( | ( | ( | ||||||||||||||
| Balance at June 30, 2025 | |||||||||||||||||
| Net income | — | ||||||||||||||||
| Common stock dividends and distributions | ( | ( | |||||||||||||||
| Balance at September 30, 2025 | $ | $ | $ | ||||||||||||||
| Balance at December 31, 2025 | $ | $ | $ | ||||||||||||||
| Net income | — | ||||||||||||||||
| Balance at March 31, 2026 | |||||||||||||||||
| Net income | — | ||||||||||||||||
| Balance at June 30, 2026 | |||||||||||||||||
| Net income | — | ||||||||||||||||
| Common stock dividends and distributions | — | ( | ( | ||||||||||||||
| Balance at September 30, 2026 | $ | $ | $ | ||||||||||||||
| See Notes to Financial Statements. | |||||||||||||||||
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ENTERGY CORPORATION AND SUBSIDIARIES
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
See “Part I, Item 1, Litigation” in the Form 10-K for a discussion of legal, administrative, and other regulatory proceedings affecting Entergy. Also see Notes 1 and 2 to the financial statements herein and “Item 5. Other Information - Environmental Regulation” below for updates regarding environmental proceedings and regulation. The following is an update to that discussion.
Dorrell, et al. v. Constellation Energy, et al. Antitrust Class Action Litigation
On July 11, 2025, an antitrust class action lawsuit was filed in the United States District Court for the District of Maryland on behalf of a putative class against Entergy Corporation, 26 other entities alleged to own and/or operate commercial nuclear power plants in the United States (together with Entergy Corporation, the “nuclear defendants”), and two consulting companies. The class action complaint purports to be brought on behalf of all persons employed in nuclear power generation by the nuclear defendants and their subsidiaries and related entities in the United States from May 1, 2003 to the present. The plaintiffs primarily allege that the nuclear defendants, together with the consulting company defendants, violated Section 1 of the Sherman Act, 15 U.S. Code Chapter 1 by conspiring to suppress compensation and exchange collective bargaining agreement and wage information through a trade group, a consulting firm, and direct communications, including while in attendance at conferences, from May 2003 to the present. The plaintiffs are seeking unspecified monetary damages, including treble damages, interest, injunctive relief, attorney’s fees, and costs. In December 2025 the defendants filed a motion to dismiss. In August 2026 the United States District Court for the District of Maryland granted the defendants’ motion to dismiss, without prejudice, giving the plaintiffs 45 days to amend their complaint to cure the deficiencies. In September 2026 plaintiffs submitted a motion seeking leave to file a second amended complaint, which adds the Institute of Nuclear Power Operations as a defendant and includes additional allegations against the original defendants.
Item 1A. Risk Factors
There have been no material changes to the risk factors discussed in “Part I, Item 1A. Risk Factors” in the Form 10-K.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Issuer Purchases of Equity Securities (1)
| Period | Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of a Publicly Announced Plan | Maximum $ Amount of Shares that May Yet be Purchased Under a Plan (2) | ||||||||||||||||||||||
| 7/01/2026-7/31/2026 | — | $— | — | $350,052,918 | ||||||||||||||||||||||
| 8/01/2026-8/31/2026 | — | $— | — | $350,052,918 | ||||||||||||||||||||||
| 9/01/2026-9/30/2026 | — | $— | — | $350,052,918 | ||||||||||||||||||||||
| Total | — | $— | — | |||||||||||||||||||||||
In accordance with Entergy’s stock-based compensation plans, Entergy periodically grants stock options to key employees, which may be exercised to obtain shares of Entergy’s common stock. According to the plans, these shares can be newly issued shares, treasury stock, or shares purchased on the open market. Entergy’s management has been authorized by the Board to repurchase on the open market shares up to an amount sufficient to fund the exercise of grants under the plans. In addition to this authority, the Board has authorized share repurchase programs
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to enable opportunistic purchases in response to market conditions. In October 2010 the Board granted authority for a $500 million share repurchase program. The amount of share repurchases under these programs may vary as a result of material changes in business results or capital spending or new investment opportunities. In addition, in the first quarter 2026, Entergy withheld 88,415 shares of its common stock at $93.19 per share, 72,452 shares of its common stock at $94.97 per share, 217,131 shares of its common stock at $95.67 per share, 56,436 shares of its common stock at $97.96 per share to pay income taxes due upon vesting of restricted stock granted and payout of performance units as part of its long-term incentive program.
(1)See Note 12 to the financial statements in the Form 10-K for additional discussion of the stock-based compensation plans.
(2)Maximum amount of shares that may yet be repurchased relates only to the $500 million share repurchase program plan and does not include an estimate of the amount of shares that may be purchased to fund the exercise of grants under the stock-based compensation plans.
Item 5. Other Information
Rule 10b5-1 Trading Arrangements
No director or officer of Entergy or any of the Registrant Subsidiaries adopted terminated
Retail Rate Regulation
The following is an update to the “Retail Rate Regulation” section of Part I, Item 1 of the Form 10-K.
Entergy Louisiana
Fuel and Purchased Power Cost Recovery
As discussed in the Form 10-K, to help stabilize electricity costs, Entergy Louisiana received approval from the LPSC to hedge its exposure to natural gas price volatility through the use of financial instruments. In May 2024, following the conclusion of its five-year hedging program, Entergy Louisiana filed an application with the LPSC for a permanent hedging program. The permanent gas hedging program would also utilize financial hedges for a portion of Entergy Louisiana’s non-industrial natural gas exposure. In May 2026, Entergy Louisiana and the LPSC staff filed a proposed stipulated settlement agreement for LPSC consideration. Under the terms of the proposed settlement, the LPSC would find that the proposed permanent gas hedging program was in the public interest and approve the implementation of a rider mechanism to refund the costs and benefits of the hedging program in customer rates. In June 2026 the LPSC approved the proposed settlement. A written order was issued in July 2026.
Regulation of the Nuclear Power Industry
The following are updates to the “Regulation of the Nuclear Power Industry” section of Part I, Item 1 of the Form 10-K.
NRC Reactor Oversight Process
The NRC’s Reactor Oversight Process is a program to collect information about plant performance, assess the information for its safety significance, and provide for appropriate licensee and NRC response. The NRC evaluates plant performance by analyzing two distinct inputs: inspection findings resulting from the NRC’s inspection program and performance indicators reported by the licensee. The evaluations result in the placement of each plant in one of the NRC’s Reactor Oversight Process Action Matrix columns: “licensee response column,” or Column 1, “regulatory response column,” or Column 2, “degraded cornerstone column,” or Column 3, “multiple/repetitive degraded cornerstone column,” or Column 4, and “unacceptable performance,” or Column 5. Plants in
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Column 1 are subject to normal NRC inspection activities. Plants in Column 2, Column 3, or Column 4 are subject to progressively increasing levels of inspection by the NRC with, in general, progressively increasing levels of associated costs. Continued plant operation is not permitted for plants in Column 5. All of the nuclear generating plants owned and operated by Entergy’s Utility business are currently in Column 1, with the exception of Grand Gulf and River Bend, which are in Column 2.
In April 2026 the NRC issued a final significance determination and notice of violation for Grand Gulf, in which it finalized a “white” finding with “low safety significance” related to one of Grand Gulf’s emergency diesel generators, resulting in Grand Gulf’s placement in Column 2, effective first quarter 2026. In September 2026, Grand Gulf successfully completed an NRC supplemental inspection related to the emergency diesel generator issue. The NRC is expected to issue an inspection report in fourth quarter 2026 documenting Grand Gulf’s return to Column 1, effective third quarter 2026.
In August 2026 the NRC issued a final significance determination and notice of violation for River Bend, in which it finalized a “white” finding with “low safety significance” related to one of the service water pumps at River Bend, resulting in River Bend’s placement in Column 2, effective third quarter 2026. River Bend will remain in Column 2 until the satisfactory completion of an NRC supplemental inspection.
Environmental Regulation
The following are updates to the “Environmental Regulation” section of Part I, Item 1 of the Form 10-K.
National Ambient Air Quality Standards
Revised Fine Particulate (PM2.5) NAAQS
As discussed in the Form 10-K, in March 2024 the EPA issued a final rule which revised the primary annual National Ambient Air Quality Standards (NAAQS) for fine particulate matter, also known as PM2.5, from 12 ug/m3 to 9 ug/m3. Initial attainment/nonattainment designations for areas with available information were required within two years of the rule’s issuance. A coalition of 24 states challenged the 2024 rule in the D.C. Circuit; however, that challenge has been held in abeyance pending the agency’s reconsideration of the rule. In November 2025 the EPA filed a motion asking the D.C. Circuit to vacate the agency’s 2024 revision of the PM2.5 NAAQS which lowered the primary standard to 9 ug/m3. In June 2026, the D.C. Circuit denied the EPA’s motion to vacate and denied the petitions for review filed by the coalition. As a result, the 2024 standard of 9 ug/m3 remains in effect. In July 2026, following the June 2026 decision by the D.C. Circuit, the United States District Court for the Northern District of California issued an order requiring the EPA to promulgate designations for the 2024 standard, for all areas of the United States, by February 6, 2027.
Regional Haze
As discussed in the Form 10-K, in June 2005 the EPA issued its final Clean Air Visibility Rule (CAVR) regulations that potentially could result in a requirement to install SO2 and NOx pollution control technology as Best Available Retrofit Control Technology to continue operating certain of Entergy’s fossil generation units. The rule leaves certain CAVR determinations to the states. This rule establishes a series of 10-year planning periods, with states required to develop state implementation plans (SIPs) for each planning period, with each SIP including such air pollution control measures as may be necessary to achieve the ultimate goal of the CAVR by the year 2064. The various states are currently in the process of developing SIPs to implement the second planning period of the CAVR, which addresses the 2018-2028 planning period.
The Arkansas Department of Energy and Environment, Division of Environmental Quality (ADEQ) did not meet the July 31, 2021 SIP submission deadline, but subsequently submitted a final SIP to the EPA for review. The ADEQ reviewed Entergy’s Independence plant but determined that additional air emission controls would not be
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cost-effective considering the facility’s commitment to cease coal-fired combustion by December 31, 2030. In August 2026 the EPA issued a final approval of the ADEQ SIP submittal.
Greenhouse Gas Emissions
As discussed in the Form 10-K, in May 2024 the EPA finalized rules regulating greenhouse gas emissions from new combustion turbine electric generating units (EGUs) under Section 111(b) of the Clean Air Act and from certain existing coal- and gas-fired EGUs under Section 111(d) of the Clean Air Act.
For existing generating units, the rule established emission guidelines issued under Section 111(d) of the Clean Air Act and provided states with two years to develop a plan to implement the emission guidelines with respect to subject emission units within their state. The emission guidelines required reductions in CO2 emissions from existing coal-fired generating units which plan to operate beyond January 1, 2032 and exempted coal-fired units which plan to permanently cease operations prior to this date. The emission guidelines also established CO2 efficiency standards for existing gas-fired steam EGUs. These emission standards would apply beginning January 1, 2030. Entergy’s existing gas-fired steam generating units are expected to meet these CO2 emission standards. Numerous lawsuits were filed in the D.C. Circuit challenging the final rule, and oral argument was held in December 2024. In September 2026 the EPA released a final rule repealing most provisions of the May 2024 rule including (1) the Phase 2 standard requiring carbon capture and sequestration for new combustion turbines because it is not an adequately demonstrated technology and (2) the standards for existing coal and gas units. The rule will be effective November 16, 2026. Thus, the only standards that remain are the Phase 1 standards for new gas combustion turbines. However, concurrent with the final rule, the EPA issued a supplemental proposal (2026 Proposal) to repeal all remaining Section 111 emissions standards for CO2 emissions from EGUs. The EPA states in the 2026 Proposal that Section 111 does not authorize the agency to regulate greenhouse gas emissions from EGUs in response to global climate change concerns. Comments on the 2026 Proposal are due November 2, 2026. Litigation regarding the EPA’s partial repeal of the 2024 final rule is expected.
Coal Combustion Residuals
As discussed in the Form 10-K, in April 2015 the EPA published the final coal combustion residuals (CCR) rule (2015 CCR Rule) regulating CCRs destined for disposal in landfills or surface impoundments as non-hazardous wastes regulated under Resource Conservation and Recovery Act Subtitle D. The final regulations created new compliance requirements including modified storage, new notification and reporting practices, product disposal considerations, and CCR unit closure criteria but excluded CCRs that are beneficially reused in certain processes. Entergy believes that on-site disposal options will be available at its facilities, to the extent needed.
In May 2024 the EPA finalized a rule (2024 CCR Rule) establishing management standards for legacy CCR surface impoundments (i.e., inactive surface impoundments at inactive power plants) and establishing a new class of units referred to as CCR management units (CCRMUs) (i.e., non-containerized CCR located at a regulated CCR facility). CCR utilized in roadbeds and embankments is excluded from the CCRMU definition. Entergy does not have any legacy impoundments; however, the definition of CCRMUs includes on-site areas where CCR was beneficially used. This is contrary to the 2015 CCR Rule which exempted beneficial uses that met certain criteria. Under this expanded rule, all facilities were required to identify and delineate any CCRMU greater than one ton and submit a facility evaluation report by February 2026. Any potential requirements for corrective action or operational changes under the 2015 CCR Rule and the 2024 CCR Rule continue to be assessed. Notably, ongoing litigation has resulted in the EPA’s continuing review of the rules. In February 2026, as part of its stated deregulatory agenda, the EPA finalized a rule extending various deadlines, including the facility evaluation report Parts 1 and 2 deadlines by one year, until February 2027 and February 2028, respectively. In April 2026 the EPA issued a proposed rule amending several provisions of the existing CCR regulations including, among other things, a rescission or alternative revision of the CCRMU requirements, revisions to the legacy CCR surface impoundment provisions, and revisions to the beneficial use definition. Comments were due in June 2026 and final action is expected by the end of 2026.
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Item 6. Exhibits
| 4(a) - | Officer’s Certificate for Entergy Corporation supplemental to Subordinated Indenture (For Unsecured Subordinated Debt Securities) of Entergy Corporation, dated as of May 1, 2024, establishing the terms of Entergy Corporation’s Series 2026A Junior Subordinated Debentures due December 15, 2056 (4(a) to Form 8-K filed August 7, 2026 in 1-11299). | |||||||
| 4(b) - | Officer’s Certificate for Entergy Corporation supplemental to Subordinated Indenture (For Unsecured Subordinated Debt Securities) of Entergy Corporation, dated as of May 1, 2024, establishing the terms of Entergy Corporation’s Series 2026B Junior Subordinated Debentures due December 15, 2058 (4(b) to Form 8-K filed August 7, 2026 in 1-11299). | |||||||
| 4(c) - | Officer’s Certificate No. 38-B-26, dated as of August 10, 2026, supplemental to Mortgage and Deed of Trust of Entergy Louisiana, dated as of November 1, 2015, establishing the terms of Entergy Louisiana’s Collateral Trust Mortgage Bonds, 5.50% Series due September 15, 2036 (4.71(a) to Form 8-K filed August 13, 2026 in 1-32718). | |||||||
| 4(d) - | Officer’s Certificate No. 38-B-27, dated as of August 10, 2026, supplemental to Mortgage and Deed of Trust of Entergy Louisiana, dated as of November 1, 2015, establishing the terms of Entergy Louisiana’s Collateral Trust Mortgage Bonds, 6.20% Series due September 15, 2056 (4.71(b) to Form 8-K filed August 13, 2026 in 1-32718). | |||||||
| 4(e) - | Twenty-Third Supplemental Indenture, dated as of August 1, 2026, to Mortgage Deed of Trust of Entergy Louisiana, dated as of November 1, 2015 (4.72 to Form 8-K filed August 13, 2026 in 1-32718). | |||||||
| *31(a) - | Rule 13a-14(a)/15d-14(a) Certification for Entergy Corporation. | |||||||
| *31(b) - | Rule 13a-14(a)/15d-14(a) Certification for Entergy Corporation. | |||||||
| *31(c) - | Rule 13a-14(a)/15d-14(a) Certification for Entergy Arkansas. | |||||||
| *31(d) - | Rule 13a-14(a)/15d-14(a) Certification for Entergy Arkansas. | |||||||
| *31(e) - | Rule 13a-14(a)/15d-14(a) Certification for Entergy Louisiana. | |||||||
| *31(f) - | Rule 13a-14(a)/15d-14(a) Certification for Entergy Louisiana. | |||||||
| *31(g) - | Rule 13a-14(a)/15d-14(a) Certification for Entergy Mississippi. | |||||||
| *31(h) - | Rule 13a-14(a)/15d-14(a) Certification for Entergy Mississippi. | |||||||
| *31(i) - | Rule 13a-14(a)/15d-14(a) Certification for Entergy New Orleans. | |||||||
| *31(j) - | Rule 13a-14(a)/15d-14(a) Certification for Entergy New Orleans. | |||||||
| *31(k) - | Rule 13a-14(a)/15d-14(a) Certification for Entergy Texas. | |||||||
| *31(l) - | Rule 13a-14(a)/15d-14(a) Certification for Entergy Texas. | |||||||
| *31(m) - | Rule 13a-14(a)/15d-14(a) Certification for System Energy. | |||||||
| **32(a) - | Section 1350 Certification for Entergy Corporation. | |||||||
| **32(b) - | Section 1350 Certification for Entergy Corporation. | |||||||
| **32(c) - | Section 1350 Certification for Entergy Arkansas. | |||||||
| **32(d) - | Section 1350 Certification for Entergy Arkansas. | |||||||
| **32(e) - | Section 1350 Certification for Entergy Louisiana. | |||||||
| **32(f) - | Section 1350 Certification for Entergy Louisiana. | |||||||
| **32(g) - | Section 1350 Certification for Entergy Mississippi. | |||||||
| **32(h) - | Section 1350 Certification for Entergy Mississippi. | |||||||
| **32(i) - | Section 1350 Certification for Entergy New Orleans. | |||||||
| **32(j) - | Section 1350 Certification for Entergy New Orleans. | |||||||
| **32(k) - | Section 1350 Certification for Entergy Texas. | |||||||
| **32(l) - | Section 1350 Certification for Entergy Texas. | |||||||
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| **32(m) - | Section 1350 Certification for System Energy. | |||||||
| *101 INS - | Inline XBRL Instance Document - The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | |||||||
| *101 SCH - | Inline XBRL Schema Document. | |||||||
| *101 PRE - | Inline XBRL Presentation Linkbase Document. | |||||||
| *101 LAB - | Inline XBRL Label Linkbase Document. | |||||||
| *101 CAL - | Inline XBRL Calculation Linkbase Document. | |||||||
| *101 DEF - | Inline XBRL Definition Linkbase Document. | |||||||
| *104 - | Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibits 101). | |||||||
___________________________
Pursuant to Item 601(b)(4)(iii) of Regulation S-K, Entergy Corporation agrees to furnish to the Commission upon request any instrument with respect to long-term debt that is not registered or listed herein as an Exhibit because the total amount of securities authorized under such agreement does not exceed ten percent of the total assets of Entergy Corporation and its subsidiaries on a consolidated basis.
| * | Filed herewith. | ||||
| ** | Furnished, not filed, herewith. | ||||
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, each registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. The signature for each undersigned company shall be deemed to relate only to matters having reference to such company or its subsidiaries.
| ENTERGY CORPORATION ENTERGY ARKANSAS, LLC ENTERGY LOUISIANA, LLC ENTERGY MISSISSIPPI, LLC ENTERGY NEW ORLEANS, LLC ENTERGY TEXAS, INC. SYSTEM ENERGY RESOURCES, INC. | ||
| /s/ Patrick J. Stack | ||
| Patrick J. Stack Senior Vice President and Chief Accounting Officer (For each Registrant and for each as Principal Accounting Officer) | ||
Date: November 2, 2026
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