Entergy Corporation

Thank you for standing by. My name is Greg and I will be your conference operator today. At this time, I would like to welcome everyone to today's EnterG Corporation second quarter earnings call and teleconference. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you'd like to ask a question during this time, simply press star followed by the number one on your telephone keypad. and I will now turn the call over to Liz Hunter, Vice President of Investor Relations for Entergy Corporation. Liz, you have the floor.

Good morning. Thank you, Greg, and thanks to everyone for joining this morning. We will begin today with comments from Entergy's Chair and CEO, Drew Marsh, and then Kimberly Fontan, our CFO, will review results. In today's call, management will make certain forward-looking statements. Actual results could differ materially from these forward-looking statements due to a number of factors which are set forth in our earnings release, our slide presentation, and our SEC filings. Entergy does not assume any obligation to update these forward-looking statements. Management will also discuss non-GAAP financial information. Reconciliations to the applicable GAAP measures are included in today's press release and slide presentation both of which can be found on the investor relations section of our website. And now I will turn the call over to Drew.

Thank you, Liz, and good morning, everyone. Today we are reporting quarterly adjusted earnings per share of $1.03. We remain firmly on track to meet our 2026 adjusted EPS guidance and longer-term outlooks. Kimberly will review our financial results in more detail. Last month, we hosted our Investor Day in New York, and I want to thank all of you who attended in person and listened online. We provided a comprehensive update on our business strategy that defines how every decision starts with the customer to create long-term value for our key stakeholders, our customers, employees, communities, and owners. You also heard directly from two of our customers, AWS and Meta, on how we're working together to benefit stakeholders. Our differentiated growth story driven by macro trends was a key theme. While the technology sector is the largest demand growth contributor in our five-year plan, we also have robust demand from our traditional industrial segments. Looking beyond our current outlooks, we continue to have 7 to 12 gigawatts of hyperscale data center potential in our pipeline, as well as 3 to 5 gigawatts of interest from traditional industrial segments. Since Investor Day, interest in potential large-scale projects throughout our service area has continued to grow, and we remain excited about the opportunities before us. We've highlighted our Fair Share Plus pledge, which is our commitment to ensure that customers benefit from data center growth. Starting with our first data center agreement in 2024, We partnered with our elected leaders and our hyperscale customers to ensure that data centers pay the full cost to serve them and their fair share of fixed costs. For agreements signed to date, we expect $7 billion in customer bill benefits. On top of that, these customers bring significant economic development, community support, and grid enhancements for the communities and states where they operate. Louisiana Governor Jeff Landry is also committed to protecting customers and communities. In late June, he signed an executive order ensuring that new data centers are committed to providing customer benefits, an order that we see as consistent with our Fair Share Plus pledge. The requirements include protecting Louisiana customers, investing in grid resilience and long-term reliability, providing meaningful community benefits including workforce development, and maintaining transparency and accountability. Importantly, this new executive order moves beyond setting an expectation to now setting a standard required to qualify for state sales tax exemptions. We are proud to say that the governor held out META's investment in Richland Parish as a positive example, providing significant customer and community benefits that meet the executive order's requirements. And now, any future data centers in Louisiana must also meet that standard. Last week, we attended the White House's Ratepayer Protection Pledge event with Governor Landry, Metta President Dena Powell McCormick, and the Richland Parish School System Superintendent Sheldon Jones. We were honored to participate and highlight the work we all have done to benefit our existing customers and communities through data center investments. The White House's Ratepayer Protection Pledge, Governor Landry's recent executive order, and our Fair Share Plus Pledge are all aligned to ensure that we grow and support this transformational investment opportunity, and that we do it in a way that creates benefits for all stakeholders. I have a few operational updates today, beginning with resilience and reliability. So far this year, we've had two minor tropical storms that impacted our service area. Restoration costs were nominal and no special cost recovery is needed. We were fully prepared even though it turned out they weren't major storms. Severe weather preparation and readiness is a year-round effort focused on training, grid investments, inventory management, proactive maintenance such as vegetation management, and other activities. At Investor Day, we highlighted investments we're making in resilient infrastructure. As a recent example, Entergy Louisiana kicked off a project in St. Bernard Parish that is part of its Phase I Accelerated Resilience Program. The improvements include replacing or reinforcing approximately 640 distribution and transmission poles with infrastructure engineered to withstand wind speeds of up to 150 mph. And another example, this quarter, Our power delivery team reached an important reliability milestone for our customers. Our self-healing network program, which began installations in 2021, is improving reliability for more than a half million customers through more than 400 self-healing networks now in service. Since the program began just five years ago, we have avoided more than 700,000 customer interruptions and an estimated 80 million outage minutes. but we aren't done. We recently provided notice in Louisiana that we plan to file for additional accelerated resilience investment in the third quarter of this year. We are calling our request phase 1A and it would bridge the end of the current program and the next phase. Phase 1A will be a smaller intermediate plan to help us continue resilience improvement and retain workforce continuity while managing customer affordability. In May, Louisiana implemented a rider to support an enhanced vegetation management program. This program provides for rider recovery of vegetation management expenses above the 2025 baseline spending level. And in June, Entergy Texas closed on its $200 million Texas Energy Fund grant to strengthen electrical resilience and reliability at no cost to customers. This brings Entergy Texas' accelerated resilience plan to $337 million. Investments like these will improve storm readiness, harden the system, and ensure faster restoration following extreme weather events. These improvements are also part of our long-term planning and work to modernize the grid and reduce the number and length of outages our customers experience. Turning to nuclear. Riverbend Station was recently recognized for its 40 years of service and its importance to Louisiana's energy landscape, providing clean, reliable power during those four decades. Also, the Nuclear Energy Institute each year recognizes the nuclear industry's most innovative ideas with its top innovative practice awards. And this year's energy nuclear team is receiving four awards. Our customers will realize operational and affordability benefits as these innovations are implemented, and in some cases scaled across our fleet. One of the projects was a first-of-a-kind replacement of the reactor vessel head through the containment hatch. This work, which supports ANO's long-term operations, was part of the recent refueling outage, which successfully completed ahead of schedule on April 30th. Moving to regulatory matters, Putting our customers first remains a cornerstone of regulatory outcomes that benefit all stakeholders. Over the past quarter, we continued to move steadily through multiple proceedings. Intergy Texas updated its Distribution Cost Recovery Factor, or DCRF, to include distribution assets that benefit customers and were placed in service since our last filing. Entergy Texas also received approval for its first ever capacity cost recovery rider. This mechanism is the result of legislation passed in 2025 that modernizes MISO capacity cost recovery consistent with our other jurisdictions. Entergy Arkansas has new rates in effect for the Generating Arkansas Jobs Act rider. The Rider supports Entergy Arkansas's ability to make large investments that benefit customers and provide economic development in the state. In July, Entergy Arkansas filed its 2025 FRP historical netting adjustment. This filing reflects a rate reduction for customers, which will partially offset the impact of the base rate case, which itself was already expected to be less than 1% for residential customers. In June, Entergy Mississippi's annual FRP filing was approved, resulting in no rate change. In addition, Entergy Louisiana and Entergy New Orleans filed their annual FRPs. We expect new rates to be in effect in September for those jurisdictions. Both jurisdictions also filed to extend their current FRPs, Louisiana for one year and New Orleans for four. We continue to make progress on our other regulatory proceedings such as the EVES filing to support additional service to META, the Arkansas Rate Case, the Cottonwood Acquisition, and other investments. There's more information on these proceedings in the appendix to today's Earnings Call presentation. We engage our communities in many ways, but one of the most important is through economic development. Our four-state Gulf South corridor is benefiting from a massive construction and manufacturing boom that continues to expand. The strong economic growth in our states is having a positive effect. The economic indicators are looking strong. For example, GDP and non-farm payrolls are at 20-year highs. Population is also growing after years of declines in Louisiana and Mississippi. A strong economy is good for business, but it's also good for communities. For example, Northeast Arkansas is seeing new ancillary business investments to support the growing steel industry. This kind of complimentary activity creates an industry hub that lowers costs for all local participants and enhances regional competitiveness. Teachers in Richland Parish, Louisiana are benefiting from bonuses of up to $50,000 as a result of a growing tax base supported by META's data center investments, an example of significant new opportunity in rural communities. In Mississippi, a circuit breaker manufacturing facility is expanding to serve local and regional data center and other electric infrastructure needs and bringing more jobs and property taxes along with it. And in Southeast Texas, with multiple new and expanding LNG facilities, the region is benefiting from new college and workforce development programs designed to help local residents gain skills that will support decades-long careers in the LNG industry. Beyond economic development, our commitment to supporting our communities continues to be recognized. Entergy was once again named as an honoree of the Civic 50, which identifies the nation's most community-minded companies. Entergy was also recognized as the utilities sector leader, highlighting our ongoing commitment to employee volunteerism and community engagement. By continuing to put our customers first, we remain focused on delivering premium value to each of our key stakeholders. In the first half of 2026, we made steady progress across customer, operational, regulatory, and financial fronts. And we remain solidly on track to achieve our objectives for 2026 and beyond. I'll now turn the call over to Kimberly, who will review our financial results for the quarter.