Constellation Energy Corp (CEG) Q3 2025 Earnings Summary

Executive Summary

• Q3 2025 delivered solid operations and commercial performance: revenue $6.57B and GAAP EPS $2.97; adjusted operating EPS $3.04, up 11% year over year, supported by fewer nuclear outage days and higher capacity revenues, partially offset by lower Nuclear PTC/ZEC revenues and higher O&M from stock comp .
• Versus Street: revenue modestly beat ($6.57B vs $6.55B consensus), while adjusted EPS modestly missed ($3.04 vs $3.12 consensus) as mix shifted toward capacity upside above the PTC floor and non‑recurring O&M headwinds tied to stock appreciation ; Primary EPS Consensus Mean: $3.12; Revenue Consensus Mean: $6.55B*.
• Guidance trimmed and narrowed: FY25 adjusted operating EPS range tightened to $9.05–$9.45 (midpoint $9.25) from $8.90–$9.60 previously, reflecting commercial outperformance and nuclear overperformance, offset by higher O&M; the midpoint sits near S&P Global consensus at $9.33* .
• Strategic catalysts: Calpine acquisition remains on track to close in Q4; management highlighted progressing large AI/data center PPAs (front‑of‑meter), Maryland’s expedited CPCN solicitation and a 1,500 MW proposal (battery + gas) alongside nuclear relicensing and uprates (including Conowingo settlement and Calvert Cliffs uprate) .

What Went Well and What Went Wrong

• What Went Well

  • Nuclear operations: capacity factor 96.8% and 46,477 GWh nuclear output; outage days improved (23 refueling vs 37 prior year; 5 non‑refueling vs 20) .
  • Commercial performance above plan: higher sales margins and optimization; capacity revenue uplift with plants near/above the PTC phase‑out threshold .
  • Regulatory and asset milestones: water quality certification for Conowingo clears path for 50‑year re‑licensing; Maryland CPCN proposals submitted; credit facility upsized to $7B ahead of Calpine close .
  • Quote: “Momentum continues to build around reliable, clean nuclear energy as a cornerstone of America’s energy strategy.” — Joe Dominguez, CEO .

• What Went Wrong

  • Street EPS miss: adjusted EPS of $3.04 fell modestly short of $3.12 consensus amid lower Nuclear PTC/ZEC revenues and higher stock‑comp O&M* .
  • Gas/pumped storage dispatch match dipped to 95.5% from 98.2% year‑over‑year; reflects fleet variability .
  • The hyperscaler PPA timing remains subject to interconnection and customer approvals; management reiterated confidence but acknowledged pace constraints .

Financial Results

• Margins | Metric | Q3 2024 | Q1 2025 | Q2 2025 | Q3 2025 | |--------|---------|---------|---------|---------| | EBITDA Margin % | 32.41%* | 15.88%* | 26.21%* | 26.15%* | | EBIT Margin % | 22.32%* | 6.45%* | 15.39%* | 16.33%* | | Net Income Margin % | 18.32%* | 1.74%* | 13.75%* | 14.16%* |

Values retrieved from S&P Global.*

• KPIs | KPI | Q3 2024 | Q3 2025 | |-----|---------|---------| | Nuclear Generation (GWh) | 45,510 | 46,477 | | Nuclear Capacity Factor (ex‑Salem/STP) | 95.0% | 96.8% | | Refueling Outage Days (operated) | 37 | 23 | | Non‑refueling Outage Days (operated) | 20 | 5 | | Gas/Pumped Storage Dispatch Match | 98.2% | 95.5% | | Renewable Energy Capture | 96.0% | 96.8% |

Guidance Changes

Management rationale: commercial outperformance and nuclear overperformance, offset by higher O&M from stock compensation .

Earnings Call Themes & Trends

Management Commentary

• “Constellation delivered adjusted operating earnings of $3.04 per share this quarter, up from $2.74 per share in Q3 of last year.” — Dan Eggers, CFO .
• “Our nuclear plants delivered near‑perfect reliability… buyers now understand pricing, term, and they know they want nuclear.” — Joe Dominguez, CEO .
• “Non‑CMC units captured most of the benefit of higher capacity prices; partially offset by fewer PTCs and lower ZEC prices year over year.” — Dan Eggers, CFO .
• “We responded to Maryland’s expedited CPCN with up to 800 MW battery storage and more than 700 MW low‑carbon gas; longer‑term, 2,000 MW of new nuclear at Calvert Cliffs.” — Joe Dominguez, CEO .

Q&A Highlights

• Hyperscaler PPAs: management expects front‑of‑meter nuclear deals “soon,” pending customer approvals; gas lacks long‑term price/sustainability certainty vs nuclear .
• Calpine asset sales: confident in timeline flexibility post‑clearance; targeting “right assets” for divestiture; constructive asset sales environment .
• Demand Response: building ~1,000 MW program with GridBeyond; longer‑term contracts and floor pricing; DR plus data center flexibility equates to a “full nuclear unit” in ELCC terms .
• New nuclear vs uprates: cautious but constructive on new nuclear (needs PPA, partners, cost certainty); uprates favored for attractive economics without incremental O&M .
• Retail margins: retail on upper end of ranges; wholesale auctions more competitive but still stronger than historical averages; sustainability products carry premium margins .

Estimates Context

• Q3 2025: adjusted (normalized) EPS $3.04 vs $3.12 consensus (modest miss); revenue $6.57B vs $6.55B consensus (slight beat)*.
• FY 2025 EPS: guidance $9.05–$9.45 (midpoint $9.25) vs consensus $9.33 — near inline; Street likely to hold estimates near midpoint pending Calpine close timing and O&M trajectory*.
  Values retrieved from S&P Global.*

Key Takeaways for Investors

• Operational excellence continued: fleet capacity factor at 96.8% with materially fewer outages; supports visibility into base earnings .
• Mix shift toward capacity/market upside above PTC floor aided Q3; lower state attribute revenues (PTC/ZEC) and stock‑comp O&M created an EPS drag, yielding a modest Street miss despite core strength .
• Guidance narrowed to $9.05–$9.45; midpoint broadly consistent with consensus and reflects confidence in commercial/nuclear execution while absorbing O&M headwinds .
• Near‑term catalysts: Calpine close in Q4 (liquidity upsized to $7B), potential hyperscaler PPAs, Maryland CPCN outcomes; these could re‑rate the multiple on long‑term contracted nuclear margins .
• Structural tailwinds: capacity pricing strength, expanding spark spreads/heat rates, PTC inflation floor support, and nuclear uprates/relicensing underpin medium‑term EPS growth .
• Watch items: dispatch match rate softness in non‑nuclear fleet (95.5%); timing risk on interconnections and customer approvals for large PPAs; ZEC/PTC variability quarter‑to‑quarter .
• Trading implications: revenue beat/adjusted EPS miss likely neutral near term; focus should shift to Q4 catalysts (Calpine closing, PPA announcements) and 2026 combined guidance commentary on the late‑February call .