NRG Energy Reports Strong Q3 but Faces Loss

(Reuters) – NRG Energy (NYSE:NRG) exceeded third-quarter core profit estimates on Friday, attributed to lower supply costs across its service territories, resulting in a share increase of over 3% before the bell.

U.S. natural gas prices decreased in the quarter compared to the previous year, making fuel supply cheaper across NRG's service territory.

However, the utility reported a loss of $767 million in the third quarter, down from a $343 million profit a year ago due to challenges with its economic hedges. NRG indicated that falling ERCOT forward power prices in Texas resulted in a $1.63 billion impact on net profit.

Hedging plays a critical role in helping companies manage risk and shield energy traders from unpredictable price fluctuations.

The Houston, Texas-based utility announced an increased 2024 adjusted profit forecast of $5.95 to $6.75 per share, up from a previous range of $5.00 to $6.30 per share. For 2025, the company anticipates an annual adjusted profit between $6.75 and $7.75 per share, where the midpoint exceeds analysts' expectations of $6.80 per share, as per data compiled by LSEG.

NRG Energy reported adjusted earnings before interest, taxes, depreciation, and amortization of $1.06 billion for the quarter ending September 30, surpassing expectations of $997.9 million. However, adjusted earnings per share of $1.90 fell short of analysts' estimates of $2 per share.