Constellation Energy 10-Q 2026-03-31

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

For the Quarterly Period Ended March 31, 2026

or

Securities registered pursuant to Section 12(b) of the Act:

Indicate by check mark whether the registrant (1) has 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 registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Indicate by check mark whether the registrant has 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 registrant was required to submit such files). Yes ý No ¨

Indicate by check mark whether the 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.

If an emerging growth company, indicate by check mark if the registrant has 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. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No x

The number of shares outstanding of each registrant’s common stock as of April 30, 2026 was as follows:

TABLE OF CONTENTS

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(Dollars in millions except per share data, unless otherwise noted)

Executive Overview

Constellation Energy Corporation, a Fortune 200 company headquartered in Baltimore, is the largest private-sector power producer in the world and the nation’s largest producer of clean and reliable energy. With 55 gigawatts of capacity from nuclear, natural gas, oil, geothermal, hydro, wind and solar facilities, our fleet has the generating capacity to power the equivalent of 27 million homes, providing about 10% of the nation’s clean energy and delivering the around-the-clock reliability needed to power America’s growing economy. We are also the largest nuclear energy company in the U.S. and a leading competitive retail supplier, serving approximately 2.5 million customer accounts nationwide, including 80% of the Fortune 100. We are committed to investing in innovation and new technologies to drive the transition to a reliable, sustainable and secure energy future.

Significant Transactions and Developments

Acquisition of Calpine Corporation

On January 7, 2026, we acquired 100% of the outstanding equity of Calpine for a purchase price of approximately $21.8 billion. The merger consideration consisted of 50 million newly issued shares of our common stock, no par value, and approximately $4.5 billion in cash on hand. After considering divestitures connected with certain regulatory approvals, Calpine owns and operates a generation fleet of predominantly natural gas, geothermal, battery storage, and solar assets with approximately 23 GWs of generation capacity, in addition to a competitive retail electric supplier platform serving approximately 62 TWhs of load annually.

This acquisition is complementary to, and aligns strategically with, our existing business operations and provides both increased scale and meaningful market diversification. The merger couples the largest producer of clean, emissions-free energy with the reliable, dispatchable natural gas assets of Calpine, and also creates the nation’s leading competitive retail electric supplier, providing increased scale, diversification and complementary capabilities that enable us to meet growing demand with a broader array of energy and sustainability products. The addition of Calpine strengthens our essential role in providing clean, reliable energy as the nation seeks to transition to a more sustainable future, and will better position us to pursue investments in new and existing technologies to meet growing demand.

In March 2026, we entered into an agreement with LS Power Equity Advisors, LLC to sell five natural gas-fired generating facilities with approximately 4.4 GWs of capacity from Calpine's portfolio of generation assets located in PJM to satisfy regulatory commitments related to our acquisition of Calpine. The transaction is valued at $5.0 billion before closing adjustments and remains subject to customary closing conditions, including receipt of applicable regulatory approvals. Completion of this transaction, together with the planned divestiture of an additional ERCOT facility, is expected to satisfy the remaining regulatory commitments related to the merger.

See Note 2 — Mergers, Acquisitions, and Dispositions and Note 13 — Debt and Credit Agreements of the Combined Notes to Consolidated Financial Statements for additional information.

New Data Center Facility at Freestone Energy Center

In the first quarter of 2026, we signed a new 380 MW agreement with Dallas-based CyrusOne, a leading global data center developer and operator, to connect and serve a new data center adjacent to the Freestone Energy Center, in Freestone County, Texas. The agreement provides CyrusOne with access to power, grid connectivity and site infrastructure needed to support development of the new facility, while ensuring electricity continues to flow to the regional grid and ensuring reliability for all customers and communities. Calpine has also entered into an exclusive agreement to provide power, grid connectivity and site infrastructure for Phase 2, which will be an additional 380 MWs. These agreements are in addition to the 400 MW agreements announced in the second half of last year between Calpine and CyrusOne for the Thad Hill Energy Center in Bosque County, Texas.

Pastoria Solar Project

In April 2026, we celebrated the commissioning of the 105 MW Pastoria Solar Project, the largest renewable energy project contracted by the California Department of Water Resources to date in its mission to fully decarbonize its operations by 2035. The Pastoria Solar Project connects to the grid through the interconnection facilities at our highly efficient 750 MW natural gas-fired combined-cycle generating facility. Also, co-located with the Pastoria Solar Project is the Pastoria Power Bank, a 80 MW/320 MWh Battery Energy Storage System, which will be coming online during the spring/summer of 2026. The Pastoria Power Bank is contracted and supported by a 15-year power purchase agreement with Pacific Gas and Electric Company.

Pin Oak Creek Energy Center

In April 2026, our Pin Oak Creek Energy Center achieved commercial operation. Pin Oak Creek is a 460-megawatt, state-of-the-art natural gas facility designed to provide reliable, dispatchable power to the ERCOT grid. As a peaking facility, it is built to operate when demand is highest and reliability matters most, while also maintaining the flexibility to run longer if system conditions require it. The project is a direct response to Texas’ continued growth and increasing electricity demand across homes, businesses, and industry. Pin Oak Creek will play a critical role in strengthening grid reliability and supporting the state’s economic momentum.

Other Key Business Drivers

PJM Market Reform

In January 2026, the National Energy Dominance Council, with support from Governors within the PJM territory, urged PJM to file proposed tariff revisions at FERC to improve reliability and cost-effectiveness within its capacity auctions. During the first quarter of 2026, PJM began stakeholder discussions and preparatory work in response to this directive, including evaluation of a potential reliability backstop mechanism, enhancements to large load forecasting methodologies, and actions to accelerate generator interconnection studies. In February 2026, PJM filed tariff revisions proposing to extend the existing RPM capacity market price collar—consisting of a price cap of approximately $325/MW‑day and a price floor of approximately $175/MW‑day—for the 2028/2029 and 2029/2030 Base Residual Auctions. In an order issued by FERC in April 2026, FERC accepted PJM’s tariff revisions, allowing the continued application of the price collar for the specified delivery years. The Commission found the filing sufficiently justified to proceed, citing ongoing reliability concerns and extraordinary demand growth, including data center load expansion, and anticipated market reforms.

FERC Issues Order in PJM Show Cause Proceeding

In December 2025, FERC issued a draft order finding PJM's tariff unjust and unreasonable as it relates to colocated load, citing lack of sufficient clarity and consistency regarding rates, terms, and conditions of service for interconnection customers serving co-located load. The draft order also found that behind-the-meter generation rules in PJM's current tariff are no longer appropriate. PJM's current tariff requires that all co-located load be served through the PJM transmission system and that any planned modifications to generating facilities would require reliability studies and be subject to PJM's approval. FERC is now directing PJM to revise its tariff to: a) detail the terms and conditions for interconnection customers serving co-located load, b) require transmission customers serving co-located load to choose from four specific service options, and c) revise behind-the-meter generation rules, including the development of a tra

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(Dollars in millions, unless otherwise noted)

We are exposed to market risks associated with adverse changes in commodity prices, counterparty credit, interest rates, and equity prices. We manage these risks through risk management policies and objectives for risk assessment, control and valuation, counterparty credit approval, and the monitoring and reporting of risk exposures. The Executive Committee and the Audit and Risk Committee of the Board of Directors have oversight responsibilities for risk management. The following discussion serves as an update to ITEM 7A — QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK of our 2025 Annual Report on Form 10-K incorporated herein by reference.

Commodity Price Risk

Commodity price risk is associated with price movements resulting from changes in supply and demand, fuel costs, market liquidity, weather conditions, governmental, regulatory and environmental policies, and other factors. To the extent the total amount of energy we produce or procure differs from the amount of energy we have contracted to sell, we are exposed to market fluctuations in commodity prices. We seek to mitigate our commodity price risk through the sale and purchase of electricity, natural gas and oil, and other commodities.

Electricity available from our owned or contracted generation supply in excess of our obligations to customers is sold into the wholesale markets. To reduce commodity price risk caused by market fluctuations, we enter into non-derivative contracts as well as derivative contracts, including swaps, futures, forwards, and options, with approved counterparties to hedge anticipated exposures in locations and periods where our load serving activities do not naturally offset existing generation portfolio risk. Portfolio hedging activities are generally concentrated in the prompt three years, when customer demand and market liquidity enable effective price risk mitigation. We expect the settlement of the majority of our economic hedges will occur during 2026 through 2028. We also enter into transactions that further optimize the economic benefits of our overall portfolio.

In general, increases and decreases in forward market prices have a positive and negative impact, respectively, on owned and contracted generation positions that have not been hedged. Beginning in 2024, our existing nuclear fleet is eligible for a nuclear PTC, an important tool in managing commodity price risk for each nuclear unit not already receiving state support. The nuclear PTC provides increasing levels of support as unit revenues decline below levels established in the IRA and is further adjusted for inflation annually through the duration of the program based on the GDP price deflator for the preceding calendar year. See Note 6 — Government Assistance of the Combined Notes to Consolidated Financial Statements for additional information.

The forecasted market price risk exposure is the risk of a change in the value of unhedged positions. The forecasted market price risk exposure as of March 31, 2026 for our portfolio associated with a hypothetical $10/MWh reduction in the annual average around-the-clock energy price and $5/MWh reduction in around-the-clock spark spread results in an impact to earnings that is not material for 2026 and 2027. See Note 12 — Derivative Financial Instruments of the Combined Notes to Consolidated Financial Statements for additional information.

Fuel Procurement

We procure natural gas through long-term and short-term contracts, and spot-market purchases. We also enter into natural gas transportation and storage contracts that allow us to source reliable and cost-effective natural gas for our fleet and to take advantage of favorable market pricing, regardless of when the gas is used in our operations. Fuel oil inventories are managed so that, in the winter months, sufficient volumes of fuel are available in the event of extreme weather conditions and during the remaining months to take advantage of favorable market pricing.

Nuclear fuel is obtained predominantly through long-term contracts for uranium concentrates, conversion services, enrichment services, (or a combination thereof) and fabrication services, including contracts sourced from Russia. The supply markets for uranium concentrates and certain nuclear fuel services are subject to price fluctuations and availability restrictions. Supply market conditions may make our procurement contracts subject to credit risk related to the potential non-performance of counterparties to deliver the contracted commodity or service at the contracted prices. We engage a diverse set of suppliers to secure the nuclear fuel needed to continue to operate our nuclear fleet long-term. Approximately 35% of our uranium concentrate requirements for the remainder of 2026 through 2031 are supplied by three suppliers. To-date, we have not experienced any counterparty credit risk associated with these suppliers stemming from the Russia and Ukraine conflict. In the event of non-performance by these or other suppliers, we believe that replacement uranium concentrate can be obtained, although at prices that may be unfavorable when compared to the prices under the current supply agreements. Geopolitical developments, including the Russia and Ukraine conflict and United States, United Kingdom, European Union, and Canadian sanctions against Russia, have the potential to impact delivery from multiple suppliers in the international uranium processing industry. Non-performance by these counterparties could have a material adverse impact on our consolidated financial statements. See ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS — Other Key Business Drivers for additional information on the Russia and Ukraine conflict.

Commodity Derivative Activity

The following table provides detail on changes in our commodity derivative contract net assets (liabilities) balance sheet position from December 31, 2025 to March 31, 2026. This table incorporates the unrealized gains and losses that are immediately recorded in earnings. This table excludes all NPNS contracts. See Note 12 — Derivative Financial Instruments of the Combined Notes to Consolidated Financial Statements for additional information on the balance sheet classification of the commodity derivative contract net assets (liabilities) recorded as of March 31, 2026 and December 31, 2025.

(a)Amounts are shown net of collateral paid to and received from counterparties.

(b)Includes amounts related to contracts acquired as part of the Calpine acquisition in January 2026. See Note 2 — Mergers, Acquisitions, and Dispositions of the Combined Notes to Consolidated Financial Statements for additional information.

(c)Includes derivative contracts acquired or sold through upfront payments or receipts of cash, excluding option premiums, and the associated amortizations.

Fair Values

The following table presents maturity and source of fair value for commodity derivative contract net assets (liabilities). See Note 14 — Fair Value of Financial Assets and Liabilities of the Combined Notes to Consolidated Financial Statements for additional information regarding fair value measurements and the fair value hierarchy.

(a)Amounts are shown net of collateral paid to and received from counterparties (and offset against derivative assets and liabilities) of $1,683 million at March 31, 2026.

Credit Risk

We would be exposed to credit-related losses in the event of non-performance by counterparties that execute derivative instruments. The credit exposure of derivative contracts, before collateral, is represented by the fair value of contracts at the reporting date. See Note 12 — Derivative Financial Instruments of the Combined Notes to Consolidated Financial Statements for a detailed discussion of credit risk.

Credit-Risk-Related Contingent Features

As part of the normal course of business, we routinely enter into physically or financially settled contracts for the purchase and sale of capacity, electricity, fuels, emissions allowances, and other energy-related products. In accordance with the contracts and applicable law, if we are downgraded by a credit rating agency, especially if such downgrade is to a level below investment grade, it is possible that a counterparty would attempt to rely on such a downgrade as a basis for making a demand for adequate assurance of future performance. Depending on our net position with a counterparty, the demand could be for the posting of collateral. In the absence of expressly agreed-to provisions that specify the collateral that must be provided, collateral requested will be a function of the facts and circumstances of the situation at the time of the demand. See Note 12 — Derivative Financial Instruments and Note 15 — Commitments and Contingencies of the Combined Notes to Consolidated Financial Statements for additional information regarding the letters of credit supporting the cash collateral.

We sell output through bilateral contracts. The bilateral contracts are subject to credit risk, which relates to the ability of counterparties to meet their contractual payment obligations. Any failure to collect these payments from counterparties could have a material impact on our consolidated financial statements. As market prices rise above or fall below contracted price levels, we are required to post collateral with purchasers; as market prices fall below contracted price levels, counterparties are required to post collateral with us. To post collateral, we depend on access to bank credit facilities, which serve as liquidity sources to fund collateral requirements. See ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, Liquidity and Capital Resources — Credit Matters and Cash Requirements — Credit Facilities for additional information.

RTOs and ISOs

We participate in all of the established wholesale energy markets that are administered by PJM, ISO-NE, NYISO, CAISO, MISO, SPP, AESO, OIESO, and ERCOT. ERCOT is not subject to regulation by FERC but performs a similar function in Texas to that performed by RTOs and ISOs in markets regulated by FERC. In these areas, power and related products are traded through bilateral agreements between buyers and sellers and in the energy markets that are administered by the RTOs or ISOs, as applicable. In areas where there is no RTO or ISO to administer energy markets, electricity and related products are purchased and sold primarily through bilateral agreements. For activities administered by an RTO or ISO, the RTO or ISO maintains financial assurance policies that are established and enforced by those administrators. The credit policies of the RTOs and ISOs may, under certain circumstances, require that losses arising from the default of one member be shared by the remaining participants. Non-performance or non-payment by a major member of an RTO or ISO could result in a material adverse impact on our consolidated financial statements.

Exchange Traded Transactions

We enter into commodity transactions on NYMEX, ICE, NASDAQ, NGX, and the Nodal exchange (each an Exchange and, collectively, Exchanges). The Exchange clearinghouses act as the counterparty to each trade. Transactions on the Exchanges must adhere to comprehensive collateral and margining requirements. As a result, transactions on Exchanges are significantly collateralized and have limited counterparty credit risk.

Interest Rate Risk

We use a combination of fixed-rate and variable-rate debt to manage interest rate exposure. We may also utilize interest rate swaps to manage our interest rate exposure, including derivatives to lock in rate levels in anticipation of future financings. A hypothetical 50 basis points change in interest rates associated with unhedged variable-rate long-term debt and interest rate swaps would not have resulted in a material impact to our earnings for the three months ended March 31, 2026. See Note 12 — Derivative Financial Instruments of the Combined Notes to Consolidated Financial Statements for additional information.

Equity Price Risk

We maintain trust funds, as required by the NRC, to fund the costs of decommissioning our nuclear plants. Our NDT funds are reflected at fair value in the Consolidated Balance Sheets. The mix of securities in the trust funds is designed to provide returns to be used to fund decommissioning and to compensate us for inflationary increases in decommissioning costs; however, the equity securities in the trust funds are exposed to price fluctuations in equity markets, and the value of fixed-rate, fixed-income securities are exposed to changes in interest rates. We actively monitor the investment performance of the trust funds and periodically review asset allocations in accordance with our NDT fund investment policy.

A hypothetical 25 basis points increase in interest rates and 10% decrease in equity prices would have resulted in a $1,072 million reduction in the fair value of our NDT trust assets as of March 31, 2026. This calculation holds all other variables constant and assumes only the discussed changes in interest rates and equity prices. See Note 9 — Asset Retirement Obligations of the Combined Notes to Consolidated Financial Statements and Liquidity and Capital Resources section of ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS for additional information.

Our employee benefit plan trusts also hold investments in equity and debt securities. See ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS — Critical Accounting Policies and Estimates of our 2025 Form 10-K for further information.

Disclosure Controls and Procedures

During the first quarter of 2026, our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures related to the recording, processing, summarizing, and reporting of information in periodic reports that we file or submit with the SEC. These disclosure controls and procedures have been designed to ensure that (a) information relating to our consolidated subsidiaries, is accumulated and made known to our management, including our principal executive officer and principal financial officer, by other employees as appropriate to allow timely decisions regarding required disclosure, and (b) this information is recorded, processed, summarized, and reported, as applicable, within the time periods specified in the SEC's rules and forms. Due to the inherent limitations of control systems, not all misstatements may be detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Additionally, controls could be circumvented by the individual acts of some persons or by collusion of two or more people.

Accordingly, as of March 31, 2026, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective to accomplish their objectives.

Changes in Internal Control Over Financial Reporting

We continually strive to improve our disclosure controls and procedures to enhance the quality of our financial reporting and to maintain dynamic systems that change as conditions warrant. During the first quarter of 2026, we completed the acquisition of Calpine and are in the process of integrating Calpine into our system of internal control over financial reporting. We anticipate that Calpine will be fully incorporated into our annual assessment of internal control over financial reporting for the fiscal year ending December 31, 2026. There have been no other changes in internal control over financial reporting that occurred during the first quarter of 2026 that have materially affected, or are reasonably likely to materially affect, any of our internal control over financial reporting.

PART II. OTHER INFORMATION

(Dollars in millions except per share data, unless otherwise noted)

We are parties to various lawsuits and regulatory proceedings in the ordinary course of business. For information regarding material lawsuits and proceedings, see Note 3 — Regulatory Matters and Note 15 — Commitments and Contingencies of the Combined Notes to Consolidated Financial Statements in PART I, ITEM 1. FINANCIAL STATEMENTS of this report. Such descriptions are incorporated herein by these references.

At March 31, 2026, our risk factors were consistent with the risk factors described in our 2025 Form 10-K in ITEM 1A. RISK FACTORS which was inclusive of the risks related to the Calpine acquisition and its operations.

Issuer Purchases of Equity Securities (CEG Parent)

During 2026, our Board of Directors approved a $4.4 billion increase relative to the remaining authorized amount to repurchase our outstanding common stock. No other repurchase plans or programs have been authorized. As of the date of this filing, we have approximately $4.7 billion of remaining authority for repurchases. See Note 16 — Shareholders' Equity of the Combined Notes to Consolidated Financial Statements for additional information regarding our share repurchase program.

No share repurchases occurred under the program during the three months ended March 31, 2026.

Not Applicable.

Rule 10b5-1 Trading Plans

During the three months ended March 31, 2026, none of our directors or executive officers (as defined in Rule 16a-1 under the Exchange Act) adopted or terminated any contract, instruction or written plan for the purchase or sale of our securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any "non-Rule 10b5-1 trading arrangement" (as defined in Item 408 under Regulation S-K of the Exchange Act).

• Schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K. CEG Parent will furnish the omitted schedules to the SEC upon request by the SEC.

** Portions of this exhibit have been redacted in accordance with Item 601(a)(6) of Regulation S-K.

SIGNATURES

Pursuant to requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

CONSTELLATION ENERGY CORPORATION

May 11, 2026

Pursuant to requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

CONSTELLATION ENERGY GENERATION, LLC

May 11, 2026