NRG Energy (NRG) 28 Feb 242023 Q4 Earnings call transcript

Good day, and thank you for standing by. Welcome to the NRG Energy Inc.'s Fourth Quarter 2023 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your speaker today, Kevin Cole, Head of Treasury and Investor Relations. ahead. go Please

broadcast morning, Investors and Good call to Energy's www.nrg.com be and is NRG be via Presentations phone Thank which under of webcast, Year and our XXXX Quarter can being and length, Full minutes in morning's over Earnings Fourth the XX and the you. located in welcome live section Call. Webcast. will at This website

future believe based today's differ that Safe forward-looking our except law. by may be upon as SEC Harbor this to assumptions of discussion as we everyone materially. to well in undertake may are We note risk of Please no obligation review factors statements, as presentation date. that the events, in filings. contain statements update required to urge as results today's as these reasonable the which Actual We result a

In addition, to measures. refer GAAP financial non-GAAP both and we will

regarding directly our financial information reconciliations measures, and today's measures to GAAP refer comparable For presentation. the most non-GAAP to please

And now and Coben, President call Chair the NRG's I'll turn over Interim Larry to and CEO. that, with

Thank by NRG. the Larry I'm Financial and and you, you am and everyone, on call also the and I President Chairman, Officer. Bruce morning available have I'm Chung, the we Interim our joined team Coben, And interest your this Kevin. CEO. morning, for of management for Good in thank Chief questions. members

am been for as months, X NRG been have XX than excited never for Chairman have the company X I more CEO been a I have I I years. and for While on board today. about

proposition on the NRG X. Slide Let's value begin with

day unique and differentiated improve offerings customers' simplify customers almost earned to We are and partner the X lives. through our and every million trusted residential

C&I Energy million gas and natural country. second-largest portfolio energy have Home We the and in X the and retail Smart manage customers million X.X

grid steps business and NRG balance generative with in our the in the to sheet. taken excess to of flexibility centers. and strong energy energy home We return of significant and smart to technology current the resulting needs devices We our At position to convergence beyond necessary AI financial data capital win maintaining generate the have shareholders evolution the transition. while a cash well significant

has and business today. and the excited stronger, outlook of financial than am been never the I've been Our about never company future I more

to Turning Slide X.

and increased in in XXXX, adjusted of new growth is EBITDA. stabilize result before recent Day record-free taken exceeded ranges. direct initiatives This Investor delivered flow to our previously we've cash record strengthen business. years First, XXXX we the We actions outlook and and and guidance strategic the our our

financial better, outlook are to ranges. Our reaffirming we and our continues get XXXX guidance today, better and

strategy. we electrification progress long-term advancing our Next, significant energy made and transition

We we attention now of the our phase have our our of growth. sight current next and turning XXXX, line are by $XXX to million achieving to

Lastly, shareholders. we a continue and bring disciplined sheet to our strategy you, our returning both about strong capital execute to capital significant which allocation balance

year to energy integrated quarter, performance Smart of prior $XXX results This brings platform business. and XX% higher operational to of EBITDA year, higher than XX% Slide We driven million adjusted the full X. billion than by improved of EBITDA, the fourth our our for Turning addition our adjusted year. $X.XXX primarily of delivered last the Home

our midpoint Our adjusted at and high $XXX above guidance. original XXXX EBITDA was guidance adjusted our million the of end

I strengthen again, levels target $X.XX Day. of in increased on detail above note and more $X.XX per that of of midpoint. growth actions before well high the at range provided While original above of result million our our flow share guidance resulted business. took or billion direct and projected cash $X.XX end provide flow free growth will this Bruce Day. ahead This performance to strategic even higher XXXX, And Investor at our with came initiatives in the share cash occurring free Investor per before purchases June guidance at these shortly. $XXX taken than our the But share grow place is our in

our strategic priorities. we our to delivered scorecard, XXXX across Turning

priority, for you year As safety our I'm many happen. happen this to well performance and dedication like to as making safety hard top I'd and to financial all making distractions, we results know, of focus thank achieved pleased that through is our our top decile a work and share with to as employees their

and the our our announced previously end made year initiatives, $XXX we We cost progress identify by for of phase announced our completed in million quickly synergy in excellence. $XXX improvement earlier to continuous turned next of XXXX. attention Next, energy goals program the we the direct execute million and cost

growth. Turning to

Our plan. success by $X.XX before the of in XXX free growth execution driven our per growth flow versus our primarily of target share achieving cash faster was

is pleased We beginning. incredibly current just are plan our Home with acquisition of our the growth Smart and the believe results

the starting We to surface. are only scratch

executed and $X.X we in allocation, returned debt capital on another paydown over shareholders. to billion $X.X Lastly, billion

Turning Investor to XXXX XX% are look XX% our financial Slide Day our Today, XXXX we outlook. to guidance strategic road growth a X. We ranges at map. reaffirming take in our

as expect and We momentum XXXX and deliver with across to XXXX, are earnings into of each margins efficient to industrial and best-in-class care our driven well growing our experience. volume, be residential This capabilities well retention segments. sales energy, commercial our positioned customer on and will as gained our marketing across In commercial leading we innovative continue commitments. digital success the consumer businesses diverse in and small our engines, by and and

already them. Texas, or market customers that Lubbock, over just with XXX,XXX as as is having of opportunities a choice. January opened also in early XX% made of An customers are We numerous we create arise electricity provider seizing example exciting their they

forward market. and exceeding success winning that innovative to are to we far, look So bringing expectations our our in offerings customers experiences and for

would in momentum have to for have to the markets We competition and that the also their programs electricity favorable allow providers. electricity see experience don't freely way customers community that of ability with continue to political to a choice choose as sentiment regulatory customers benefits

like Next, this our in and the diversified extreme strategy include while weather mild have past of the retail time, January, to Heather that this the events of summer winter. scenarios seen our Storm XXXX supply same we at manages exposure Winter most handling multiple

reliability expect Our and our we flexibility targeted across investments when our led improvements. improvements realize fleet it, for to material we continued of performance the and generation in needed to

enhance supply evaluate continue various We to to our ways strategy.

in flexibility, the additional outright portfolio, have rather Texas transactions ready brownfield to ownership. X longer-term options through considering we go than for dispatch storage structured and We are with sites primarily

driving Smart line margin net bottom products business customer the finally, while impressive strong per growth. customer. reducing simultaneously revenue increased and and Recurring Home And delivered cost top selling per more through year, services service a and

towards drive of wallets. expansion million We the horizontal will our customers' continue X to

customer is years Our business best unmatched driven Home by the product of reliability. Smart and retention customer performance industry in with the the and X average world-class in an life engagement customer

We we to continue achieving previously the you. Home communicated in initiatives to focus on and integrating have Smart Energy

for million to million earnings, times and X strategy cost XXXX, we growth closer $XXX result at of growth cost than than improvement incremental savings, channel was a originally end target. savings. resulting more electrification Turning delivered and initiatives energy original twice the growth cost for look are more cost than realizing $XX the sales core million advanced in This optimization by goals of transition both and $XX target and Slide continuous $XXX in our more million our exceeded million of and synergies our which full We initiatives. of XXXX. today, $XXX reaffirming And and was in growth in faster businesses we the anticipated. primarily of outperformance our than of planned In

$XXX from leveraging significant technology the Outside of are in convergence million creation opportunity home the have program, attractive also that identified of this energy initiatives early in the value and we development grid. the additional and

our where is, First power and -- data or customer proficiency VPP plant uniquely example, are scale of reach, science experience. virtual decades market we our commercial and given and for market commercial positioned

business this VPP our integrated tightens, regulatory to the allow requiring change. value without us grid and Importantly, increase will will in energy as value monetize

have are We about of load. we opportunity this largest markets for a for see data data several significant and Second, NRG of AI. the and more other competitive with we the and in conversations customers on competitive providers one hyperscalers center as been managers power of and more centers using to these Today, direct broadly.

with we strategic build dispatchable in Finally, brownfield to go. X.X new of gigawatts ready to continue Texas projects evaluate

As dispatchable you may for know, Energy approved the Texas in voters November, support Fund, Texas generation. provides which new

year be We months. these rules with applications anticipate that update for expect We the this coming midyear. beginning providing on over early projects adopted an the to

With Bruce Chung, that, to our Officer, turn to Chief I'd for a review. financial over it like Financial

Larry. you, Thank

XX. to Slide Moving

our guidance guidance flow of guidance upward exceeding end $X.XXX of free billion, For the the XXXX, NRG and produced our high billion, range. of exceeding and before original at adjusted revised upward end range of cash our $X.XXX growth high EBITDA revised

distractions. and cash our and free execution year highest, highest effort made flow from potential and by EBITDA of and second our performance the XXXX full direct excellent respectively, businesses NRG's possible continued of across is financial a This history. Our a strong of in the growth focus each before employees represents result adjusted in

as and EBITDA $X.X plans. growth of cost Texas the efficiency our adjusted execution by in Smart our driven Home to the billion of XXXX strong region, business, compared performance improved Vivint XXXX, addition Our and by

year our within adjusted beginning rates costs. with increased look with by over closer This supply $XXX lower our at a segments coupled XXXX. EBITDA by Taking was Texas, full drivers million and higher revenue driven the

mild through designed heat. the lowering Our diversified costs supply during the stable the to summer's strategy providing worked a year and our year volatile extreme pricing throughout as supply start

their our we combination and expansion both guidance. of mind. discussed for this a we foreseeable differentiated revenue be will the energy comfort and our that our over We margin and needs view produced with margin in customers XXXX, management careful C&I throughout reflected rate future, across address businesses, durable is believe and through affordability, As peace providing was XXXX saw of the expansion products residential this

delivered residential In the margins, testament XX% and strong is addition of maintaining business retention customer our experience. nearly strength average brands X our while to customer customer years. of This of to improved a energy tenure

retirements housing segments remainder was million spending the market combination from of variance East/West consumer more Goal of the as $XXX challenging and our the conservative a versus well the prior with discretionary Our facility were from lower impacting HVAC by realized businesses. million This Zero at sales the lower services and pricing and to average as due services asset year. $XX Cottonwood

of addition metrics, X% Home most ending adjusted its this $XXX notably, subscriber across delivered EBITDA, the for million guidance of Finally, key all segment. environment. Home Smart macro high revised the growth Smart achieved otherwise challenging upward in in Home Throughout above XXXX, of our end Smart contributed finishing an

increasing through monthly subscriber, coupled on X% addition to efficiency. cost revenue of average improving recurring In continued monthly focus service margins with a per

Turning setting initiatives flow to NRG businesses. working $X.X improvement of driven company. free our growth. This across prior XXXX, cash by with primarily capital along the the performance, a new before an stronger billion over year, for in $X.XXX billion our EBITDA achieved improved represents record

Day communicated Investor in $X.XX before target free growth of our we per At June, flow cash XXXX the of share.

strong performance shares XXXX repurchasing after XX% plan. of resulted flow what growth free to $X.XX Our before in Day cash had in our premium even at originally in Investor assumed a we share, per

on Our our XX%. platform yield implied an share is current that generate based represents And significant flow. flow and that share of $X.XX designed cash per free price, to cash

as investments to best and dislocation, the firmly remains the this allocation course of our Given our framework. we capital can on we with committed make, repurchasing shares staying such, one remain

the Throughout for tailwinds the share confident of macro we energy long-term smart and the the and technologies, and economy are our with strength with increasing from price. the resiliency convergence coupled strategy our XXXX, have we of outlook compelling demonstrated electrification in of

XXXX's I'd to additional the for to some Turning next provide like context slide. results. financial

of side page, of business. left resiliency the highlight we our the core the On Energy

and January's Our Texas Heather. hottest performed Texas most through during Winter second the continued in experienced fleet through recently perform summer well the Storm volatility history to

and seeing volatility of of years, in our are strategically the invested capital we both in of few summer conditions, improving money availability impact last reliability investments and our the we winter through facilities the in Over and across those anticipation material factor. have improvements the

illustrating measure generation our performance periods during we This of need them most. a assets availability when the is the

cost this respectively, the fleet's effectively. Winter chart, and XX% be a Furthermore, see and during metric Winter versus we load performance in and bar critical ensuring able to serve level Elliott. we XX% This Storm improvement in Storm saw will you realized can winter, improvement metric. a comparing we summer As XX% retail to of in in are this nearly when Heather improvement our was the

right page. to side Moving the the of

with surpassed was function expanded driven of Notably, business expectations, margin original average cost expansion coupled both Home revenue by to the the recurring monthly higher primarily margins. per lower Smart service Our a subscriber, serve.

seeing We of sale, take and and effectiveness the our of their Smart which Smart devices. Home higher testament Home a are services is customers increasing on products Smart homes at seamlessly benefit Home point integrated also intelligence recognizing the the channels additional the sales rates to through of of

Turning XX view to of allocation. Slide updated an capital our for XXXX

our As you slide, capital third view earnings call on our can has we since from XXXX initial see allocation. much provided not the changed quarter where

have the We the XXXX. will and by share $X.X $X.X return billion million expect form nearly to XXXX are to common of of Coupled current program, share down and with $XXX repurchase in still of of repurchases executed we on the planning pay in shareholders end authorization XX% the debt XXXX nearly billion dividends.

We expect to XXXX end begin our the we of share will basis repurchase and programmatic repurchase year. more this program accelerated XXXX executing on which throughout the a regular by at year, conclude the point, QX plan

of see shares I investment we our rolled XX/XX an XX%, committed remain and Day. to implied Investor for we as such, the earlier, excellent capital, an shareholder principle during As out mentioned at yield as

changes of to of cash left our the and capital business. acquisitions million, shift moving deployed costs year investments earnings small to residential and primarily million incremental increased Other book calendar in right, in $XX XXXX. in retail from excess since XXXX terms a increased integration overperformance our In from call $XX because last

of XXXX, which use year. $XX the allocation capital Finally, will unallocated we we as we available million along have for in evaluate of the move

this did they helpful, hope more call and Larry, the hand like them with new business. slides included enable point I'd provide you of not earnings slides of Investor will it Energy our We we model team We the disclosure more forward. presentation, investors in to we each a which today's appendix granularity will around have any Before answer our level is disclosure out believe may than some I to disclosures. back to business updated find questions to that energy with have happy These regarding have going be our before. you Relations new

to that, I With will Larry. turn back it you,

a thoughts our few Slide our about I want On expectations. XX, and Bruce. to you, Thank provide XXXX, closing priorities

financial We commitments principles. and are to capital laser-focused and allocation on delivering adhering on our operational our

all electrification will growth on continue to been transition integrate advancing with We have more future Home never our I our businesses and Energy Smart and NRG. deliver excited our and the of while strategy. cost energy initiatives, about

and put seeing in believe for we platform. step-change cash of a change will yields. our and generative the I will of it's services of sector the change We step on and are that across convergence of home look grid NRG AI. flow this sector durability the scarcity improvement progress to including plus through in good NRG updating you in sell will on platform signify signs Said devices in this our the smart have our for resulted We the energy technology be and our a exciting fundamentals and believe very XX% products and times. I the in forward bluntly, along way. spotlight critical the and the This depressed valuations

open your NRG. interest line time for ready you questions. in thank that, We're the With and now to your for

America. from first Bank Dumoulin-Smith Our with Instructions] [Operator comes question Julien of

robust How within I looks explicitly back specifically? reflecting where Obviously, there of about to Look, to just I very in have X. it positioning here. shares come thinking materially higher as just doing on to back that the weather in I do FCF here to the tackle 'XX secondly, you about you targets year just to are wanted what of I of the here. that this. Obviously, said out in know out with XX% like that. those gate you comments, I on year but you're you wanted in And just Start you about probably somewhat colder Texas, the through How against the the the wanted come per to think targets elaborate and that. period? to to load. relative kind positioned forecast share of you think terms then well target XX% wanted

Sure. Julien, Bruce here. it's

respect XX% we're plan. to growth the free So the to you of increasing kind already as as believe We XX% still the to the you if with at XX%, are what million we that's look committed had indicated growth we and cash the flow XX% $XXX to Day in share. Investor that achieving both before part EBITDA, per of free that cash 'XX know, above number, about flow

seeing obviously, capital are numerator. the in both we allocation then on remain drivers we So the And -- to plan. committed the

also going to be driving we're so the And denominator.

still remain XX% to XX%. committed to So we that

other With respect the as in were way we're XXXX, XXXX. about we basically the question, to positioned as same think in we

And what of in Winter a what a be The Heather, being perspective, pretty from and on performed may we so comfort at able well. where of stand us terms may to handle gives we about stage. be this very Storm for fleet lot very confident well, performed so that us -- load we're coming

take -- the a Wonderful. on comments the if little a could you Excellent. I from And bit second provided just ago.

hearing presumably opportunities. were to contract someone talked that You understood an investment you make makes. offtaker I I would want sure right, to some arrangement, offtake battery batteries and of about I'm an you here. which presumably thinking about This ERCOT storage longer-term just else be sort you're If how

have at look and for lot the money of optimize probably put is use in Julien, think willing back to -- allocate, answer, evaluate capital take we'll here the be will that but providing that are always and we who yes, strategy people I us, is that and there awful capital of storage that do as to together Texas spend we you know, but a our it capital. our and to Look, an supply come But reevaluate the as optimal structure. we their always

Shar Guggenheim Our Partners. with Pourreza next comes question from

maybe I wanted of providing, sort peers Bruce's to future one of consideration transitioning in of in function question, ask any maybe saw at change yesterday. and a a we maybe, and building of bit to a bit Have your and valuation look? step point longer-range you light to EPS comments with some obviously off of given new the the a disclosure of high-level in it's that

Yes.

All we'll right, that at leave it one.

is Stay answer, sorry, The tuned. yes. Yes.

maybe perhaps you process. just with then it's the gotten mean, just focused a And terms sort where some of a us I'm curious competitive you're retail things power power of more to going on give on or bit hunting I more person. side. consumer if CEO today search on in now back and head utility the recently Can little a more obviously, stand down-selecting. color bit person a

to look X think person as we're said won't who it I -- to of types we a spans I I consumer don't doing, that looking Shar, seem the still me, rid before. Shar. personally of you but take think that for Sure, be no, energy, get we're anxious and things

of started, We have they working had you, to committee as and whittling hard. we we said huge And list that's that. exceptionally I a terrific at are candidates away when a

would by X frame. months months, that and X think still I talked said I time I stand to when ago, we X

incredible of prospects confluence valuation the prospects, math to have I and by guess at given incredible flow be the X the do Home. And a excited looking tremendous excited months are we I by Smart who the Energy now, correctly. are there's the people are drive X the that NRG, cash if given yield, that ability So from number of would to at

and the excited I'm that I too. seeing, be, think people you so And we're by will

comes question with next from Our Storozynski Angie Seaport.

question. So picture just also a big

a those of I for power increasingly don't mean that weeks thing that get couple investors one So medal there's that learned participation we've if showing up. just value plants, the over last physical especially is

understand tightening fit wondering, in does demand side power. on response and simplistically I'm supply that to asset-light fundamentals just how there just is in and of just the new being deal demand strategy speaking, that the light So ways But wondering that? your with how other in picture. of probably I'm you I do Again, in, fit generation this

to asset -- never we're optimal let on think Sure. but and Angie, I always I've semantics. asset they're but Rob that be asset-light, think and important maybe going I'm I expand that, don't optimal semantics, we'll we're

you'll We soon, get of more have have are those potential brownfield that some X in we but the pipeline. gigawatts projects dispatchable ready on updates go, capacity, and to some and X.X that's pretty

Rob, you please? that, to Maybe, on want expand

Sure.

where capture on competitive we to believe we're those going and right? most it's for the So We for talk margins can goes markets, growth lot. about. Angie, and so more for as you've demand hyperscalers we're expanded generation, plants invested that look, to is heard up, to know we inside excited And our talk think of we've I demand that. So the real. see this in of growth fleet, I real We're because see off it's reasons. the NRG to them Like of a We by it's of all existing the and be. we sit our growing spent which lot a it's that One, others guys, of that power. exciting earnings a product to so couple going is going

plant Like, And go. across we've XX Larry ready X are we've that got the the country. Angie, projects sites thing think other got said, the is to about, to

So makes growth to we if going there. see ultimately, to partners NRG. there's opportunity turn it But an continues if then guys there like this it, are sense, -- these and economic

have. we going As got expertise market the people they're for look the who've that tightens, to

the good to going be to it's but definitely for good be us. So it's industry, going for

growth of bit on business was Because sense the I of margins business. not that that a historically, But that mean in meaningfully the towards lower the the of rest that a C&I -- side energy well, and portion very does remember you're than a customers? shifting small the

you those to margin different load like tech is anyway, C&I or used there earnings versus the for So companies that serve? profile traditional a

should gone difference on So margin there hyperscaler generally, margins versus haven't traditional C&I few The a a have C&I the the we that way The into last is in if growth of hyperscalers. that's which over years seen demand think a to from is customers. bunch system, about themselves create isn't the probably tightness the all on you believe get up. going you're real, margin -- -- to we it going a customer, for

across C&I data so not who a customers, can the are going going center tighter board, manage that help they're just be environment. means risk higher And to customers players to the Does looking the for bigger help? which expertise, to in them turn commodity price,

and And your changing then Yes. Okay. IG aspiration. topics

or metrics the had thresholds the I metrics credit Can of tell hitting with you business end besides risks vis-a-vis the So any see you've ratings? how just discussions investment-grade agencies obviously the us 'XX. the if see till they the targeted numerical

Sure, Angie.

are So rating. investment-grade chasing an clarify, not we just to

investment-grade metrics. debt it's but path that a sure credit from focused ultimately, We very cash making they They metrics look also to want regularly to are to credit not on. important to EBITDA the we believe on metrics, that just is to with flow-driven not up to are the you necessarily because that agency note that at when to which rating, we It's about think we we're like heading our and that perspective. the obviously is the hit going agencies be talk an it chasing that said, always that's we correspond we've As the agencies. say

triangulating kind we're all that. of so around of And

the Investor with plan, deleveraging end we of within on of those the flexibility or at move our sit here more were our within Ultimately, is I to where year. say, going note not, get being plans part control in up as given whether is as rating today, XXXX, to we metrics. in said, but you I'd we XXXX, come not the we're Day we our as able there's some along what control. as But probably that like necessarily to to, the end what hit think respect is original

question next with Chopra Evercore Durgesh ISI. Our comes from

I the through just of have $XXX the target XXXX. opportunity, the cost you kind and wanted go that improvements by to -- million over growth

Maybe And you've kind this you this the a just that obviously, that apart, big expectations. within us services? break million much of that margin is sort think So year actual million opportunities? versus exceeded much in about how $XXX improvements, expansion of year, $XXX running, can How as from step walk of of is to the ground Maybe help growth $XX hit drivers that? about the we then there's through your change million. existing cost of cross-selling

Yes, you bet.

of terms plan into set we obviously we where good in very feel about the XXXX. growth year So synergies, the X through

of And per revenue initiatives You can driven combination units, share think business. business customer. profile the about we organic and improved in it the of other the XX% the wallet-type a mix year a in as by the XX%, base that think driven growth as roughly margin and is obviously actually had strong by a of cross-sell

we've a so start. strong had And

relates year million The very And given the initial a guidance degree $XXX it million then have for high we X. things. of also cost side elimination in exceeded to exceeded the We our the cost our and $XXX of have full in side. $XXX the of confidence of function target for companies, XXXX. we X And traded year of a line X million we really are synergies publicly sight by to cost as

million. will probably target exceed we $XXX towards fact, our that XXXX In

sit Durgesh. we we on as so good feel And here, both ends,

beyond? be decisions It X.X you here? thinking shares and it. I'm a you'll of the sounds then maybe us half about opportunity. this through kind that thought walk back year. XXXX maybe like How the just buying making do Can your Got as outlook, versus in second gigawatt dispatchable process And long-term you gauge generation of

impact that headline. put and can strategy I or a and me let and the Look, want just our make down iota that it say, as again clear allocation of to not you X capital buyback will shares. again again,

on that. supply clear very into have we -- and several looking fit these online a strategy, coming with that on Strategically, about but both are customers, existing very, Rob supply opportunities. talking plants how who for it's that So like we've and really like AI at and strategy growth laid some also occasions out things our generative the tightening that things other been centers data for customers are of the has

want to add do you Rob, anything?

thing only we've these the a I for on So would while. is, tell you been recall, working

We today. continue to work

our hear to the you But to continue And what commitments. come Larry to like June. put Energy would we Fund capital opportunities you in rules able Texas from and those decide. ultimately it can In March, right for something see guys the names Texas to that good we to that needs plants probably building -- Texas. you being how all manage plan guys good flexibility, then for closer expect I seen, and allocation to down in different. going grid will doing in is we to out. portfolio now, final expect their make said, the our So comes have we're what for And for have us and all which sticks the or as either people get plants as the we financial

Arcaro from question next with Morgan comes David Stanley. Our

like subscriber how those was trending a now Home Again, revenue. you could those Smart into side wondering you if and How the do in I you're on growth expecting strong heading things. KPIs of XXXX? Maybe XXXX. couple recurring comment of on see

we Thank exited you. about 'XX. how feel We really year-end good Yes. the

few of you XX% mentioned, the growth. EBITDA growth, subscriber As And with really, that's XX% a adjusted growth, a things. X% function revenue

are economics great First unit shape. the of is business in the

elevated the we service customer, of margin per expansion And margin. expect per of really XXXX. cost increased reduction XX% drives to continue into revenue an the at look service our customer you that If that

durable strong we years retention had customers with it customer best As to terms relationships. and brand retaining in a and our loyalty, we ever -- of relates are our amongst

expect the mid-single the growth, in well. We to continue well. expect growth subscriber from we then in subscriber be as to terms And that of perspective digits a as

feel the up we is in So good about how business 'XX. set

to If relative you And we and growing zoom and our high very a a loyalty services degree in fragmented and peers. large, engagement have of products out, market. operate

lot so for grow And continue is of to room we a to business. the think ahead there us

across business. I Am see the wondering I these could in if impact happen helpful. center data see, understanding Okay. elaborate That's I as you classes time, more to correctly pricing? across higher growth your the the board, on And think could right you that retail it? from that business. pricing, example, for Then Got volatile that Is a potentially it. data higher way for about to you customer margins maybe ERCOT, bit load more could to lead guess, centers higher was the margins you over

Yes. Rob. It's

is X.X The that the makes then you also you're and how So parts business, towards more interesting. created portfolio that that the players about people AI across gigawatts across our the experience move, bigger prices think on historically, or our run when generally demand we seen when and cycles. different C&I, beyond is the we're going we've through we've commodity as with consumer way have a those too. we generation expands affects well just And generative to to like start in other the markets. us, in think tighter, commodity of And the will turning existing because see let's to things from the a going it businesses to retail additional historically, perspective, margins future, where they then of perspective, retail get do provider, has had a markets, there. being And platform a quality providers, platform, home manage that load

Our Michael Wolfe. next question with from comes Sullivan

by of But new to back light of frame just go political if Appreciate the way. just the there. I build broader the in making on wanted on where politics like? I stand dynamic there, some maybe disclosures around the Texas you know think, could asking year, this just of market just the to but things structure we're for the the continue do new Governor I kind and to just And in kind session ECRS. noise not Energy and headlines bill, where Lieutenant a the see stand legislative these you comments, business, new

Michael, session. understand I'd could a in there's business legislative I Texas not be different If a politics, probably,

need again in starting combination session stability That I whether doesn't on measures people think the everything capacity mean the work people football. generate that market up it's fair what's people growth lot see generate is and to Texas the fair plus it of market use on before energy And that the that's to from in that were the passed -- will time I The in we passed actually a a But the lot will margins a breaking to tightening the the over. time of to our awful many has that politics. won't and try economics legislative those implement do think front. the PUC capacity least things legislature. state actually of At as that amount last now going happening political improving the the to meet and to probably are to in expanding view business say balance, foreseeable to in looking was of start in a the future. see just

just that's move Okay. Appreciate tough helpful. plants, brownfield a do And how would these take it one. to long with you complete? forward if That's

projects, a you peakers, and broke the the So X different about could X whenever CCGT get X. and takes years from if -- the we in recall, is portfolio then in, starting we ground

would good were So be about capacity you could additional expect go XXXX if XXXX kind perspective. to years an to soon of we from and think

Okay. Great. then one last quick. just And

You any that that size your is market, of like any the Or new Lubbock sense upside? mentioned set all plan? there? of into opportunity is rough And the baked of

Yes.

the Elizabeth. is Thanks this So for question.

about choice. really we made opened, a a excited So if market made XX% about X% like it. have And things Texas One, the consumers choice. the when opening. you Lubbock point reference are of a X

that the in in into baked the March, where consumers and that come and participated Energy. actually made XX% demonstrating those process. the in do is they on business So with who presale customers care growth to XX% NRG That's beyond is flow I on choice other relative that. front, far, about and have plans. overperforming and say are we customers NRG share will thing only would of The is the we XXXX overperforming, in Texas our home so

but So in again marketplace making that XXX,XXX choice. mentioned the -- are about customers and a Larry it,

other they'll And March. in and be and so retailer start customers our

Ryan next Citi. Our comes with question Levine from

color like particular, margin touch gross about And in Texas? much conservatism in assuming light guidance that outlook. energy It 'XX? your in there. on your to there of How Any around could weather you there, normalized for forecast looks in upside is is potential any share Hoping embedded retail comments? that XXX degradation is basis points

does Ryan, basis. Bruce. weather-normalized for the XXXX on on So, the it's retail certainly The reflect a is business. a number COGS 'XX higher number assumption But

bit revenue a that so there? bit to of more in And just timing to there's a But lag a that when rate. pushed provide COGS Elizabeth, gets want color if between little the relative you realization of through

Yes.

over and comes space. in demonstrated in you AI/Machine tools the the years from stability management continuously have and created transformation improved program we've since home -- margin from that there, So revenue and most models And of the of them. the some were Learning back we

decade, of call would able The last is growing environment. and deliver highlight supply we've it, I other the stable thing margins a to this, been cost over that in variety

Bruce one, margins where increased grown aside have over through frame, mentioned. last the or held the you this that So mentioned, either time costs years, and weather few we've that significantly from normalization

measures? How you other for that's XXXX escalation these by are much assuming cost being offset

on we you we'll just probably right have get sure that's to you back on to get that numbers that. the one make Ryan, that to

for now pass Larry This Q&A will Thank to closing the portion concludes back I it Coben call. of remarks. you. today's

and the on you in see to your at exciting can you for I most for history. today us call we joining probably And think thank interest of NRG's point, want all are I the NRG. in

our We'll ahead. in Kevin all. please you further to week. to the speaking have the We look management are more with to conferences Brendan free you York that the New be at have. meantime, in with feel any days In to in can and questions reach out next the planning in might Thank hear results, I the of actual and going what you forward you achieve we voices think forward. and

gentlemen, thank conference. program. the concludes This in participation your for Ladies you today's and