Xcel Energy XEL · USD

Xcel Energy’s chief operating decision maker, the CEO, sets financial performance objectives and budgets and establishes separate targets for the regulated electric utility net income of NSP-Minnesota, NSP-Wisconsin, PSCo and SPS, as well as the regulated natural gas utility net income of NSP-Minnesota, NSP-Wisconsin and PSCo. The regulated electric utility and regulated natural gas utility segments are managed separately because of inherent differences between activities to serve electric customers and those required to serve natural gas customers, and as the revenue streams are dependent upon regulated rate recovery, which is separately determined for each segment. The CEO assesses financial performance, including quarterly and annual budget-to-actual and year-over-year variances in revenues and expenses, to inform operating decisions, capital investments and cost recovery strategies. Xcel Energy has the following reportable segments: •Regulated Electric Utility — The regulated electric utility segment generates, purchases, transmits, distributes and sells electricity in Colorado, Michigan, Minnesota, New Mexico, North Dakota, South Dakota, Texas and Wisconsin; each state’s regulated electric utility activities qualify as an operating segment, and is aggregated into Xcel Energy’s regulated electric utility segment. In addition, this segment includes sales for resale and provides wholesale transmission service to various entities in the United States. The regulated electric utility segment also includes wholesale commodity and trading operations.•Regulated Natural Gas Utility — The regulated natural gas utility segment purchases, transports, stores, distributes and sells natural gas primarily in portions of Colorado, Michigan, Minnesota, North Dakota and Wisconsin; each state’s regulated natural gas utility activities qualify as an operating segment, and is aggregated into Xcel Energy’s regulated natural gas utility segment.Equity method investments in the regulated natural gas utility segment of $81 million and $85 million at Dec. 31, 2025 and 2024, respectively, primarily relate to WYCO. Non-segment equity method investments of $204 million and $161 million as of Dec. 31, 2025 and 2024, respectively, relate to investments in energy technology funds.Asset and capital expenditure information is not provided for Xcel Energy’s reportable segments.

Revenue is classified by the type of goods/services rendered and market/customer type. Xcel Energy’s operating revenues consisted of the following: Year Ended Dec. 31, 2025(Millions of Dollars)ElectricNatural GasAll OtherTotalMajor revenue typesRevenue from contracts with customers:Residential$3,904 $1,411 $3 $5,318 C&I5,948 742 30 6,720 Other149 — 10 159 Total retail10,001 2,153 43 12,197 Wholesale715 — — 715 Transmission705 — — 705 Other69 174 — 243 Total revenue from contracts with customers11,490 2,327 43 13,860 Alternative revenue and other670 125 14 809 Total revenues$12,160 $2,452 $57 $14,669 Year Ended Dec. 31, 2024(Millions of Dollars)ElectricNatural GasAll OtherTotalMajor revenue typesRevenue from contracts with customers:Residential$3,552 $1,299 $11 $4,862 C&I5,420 646 30 6,096 Other142 — 9 151 Total retail9,114 1,945 50 11,109 Wholesale645 — — 645 Transmission648 — — 648 Other64 175 — 239 Total revenue from contracts with customers10,471 2,120 50 12,641 Alternative revenue and other676 110 14 800 Total revenues$11,147 $2,230 $64 $13,441 Year Ended Dec.

Legal Xcel Energy is involved in various litigation matters in the ordinary course of business. The assessment of whether a loss is probable or is a reasonable possibility, and whether the loss or a range of loss is estimable, often involves a series of complex judgments about future events. Management maintains accruals for losses probable of being incurred and subject to reasonable estimation. Management is sometimes unable to estimate an amount or range of a reasonably possible loss in certain situations, including but not limited to when (1) the damages sought are indeterminate, (2) the proceedings are in the early stages, or (3) the matters involve novel or unsettled legal theories.In such cases, there is considerable uncertainty regarding the timing or ultimate resolution, including a possible eventual loss. For current proceedings not specifically reported herein, management does not anticipate that the ultimate liabilities, if any, would have a material effect on Xcel Energy’s consolidated financial statements. Legal fees are generally expensed as incurred.Gas Trading Litigation — e prime is a wholly owned subsidiary of Xcel Energy. e prime was in the business of natural gas trading and marketing but has not engaged in natural gas trading or marketing activities since 2003. Multiple lawsuits involving multiple plaintiffs seeking monetary damages were commenced against e prime and its affiliates, including Xcel Energy, between 2003 and 2009 alleging fraud and anticompetitive activities in conspiring to restrain the trade of natural gas and manipulate natural gas prices. Cases were all consolidated in the U.S. District Court in Nevada. One case remains open, which is the multi-district litigation matter consisting of a Wisconsin purported class (Arandell Corp.). In October 2025, a settlement in principle was reached, resulting in an immaterial loss consistent with previously accrued amounts. This settlement is subject to court approval.Marshall Wildfire Litigation — In December 2021, a wildfire ignited in Boulder County, Colorado (Marshall Fire). On June 8, 2023, the Boulder County Sheriff’s Office released its Marshall Fire Investigative Summary and Review and its supporting documents (Sheriff’s Report). According to the Sheriff’s Report, on Dec. 30, 2021, a fire ignited on a residential property in Boulder, Colorado, located in PSCo’s service territory, for reasons unrelated to PSCo’s power lines.

Total income tax expense from operations differs from the amount computed by applying the statutory federal income tax rate to income before income tax expense. Effective income tax reconciliation for years ended Dec. 31:(Millions of Dollars)202520242023Income before income taxes (domestic)$1,773 $1,534 $1,625 Federal statutory rate impact372 322 341 (Decreases) increases in tax from:Tax creditsPTCs (a)(569)(663)(455)Other(14)(16)(17)Regulatory adjustments (b)Plant related excess deferred taxes(87)(87)(83)AFUDC equity(58)(34)(19)Other29 14 17 State income taxes, net of federal tax effect (c)78 58 73 Other4 4 (3)Income tax benefit$(245)$(402)$(146)202520242023Federal statutory rate21.0 %21.0 %21.0 %(Decreases) increases in tax from:Tax creditsPTCs (a)(32.3)(43.2)(28.1)Other(0.8)(1.1)(1.1)Regulatory adjustments (b)Plant related excess deferred taxes(4.9)(5.6)(5.1)AFUDC equity(3.2)(2.2)(1.2)Other1.6 0.9 1.0 State income taxes, net of federal tax effect (c)4.4 3.8 4.5 Other0.4 0.2 — Effective income tax rate(13.8)%(26.2)%(9.0)%(a)Wind, Solar and Nuclear PTCs (net of transfer discounts) are generally credited to customers (reduction to revenue) and do not materially impact earnings.(b)Regulatory adjustments primarily relate to the credit of plant related excess deferred taxes to customers for tax rate increases as well as the capitalization of AFUDC equity for book purposes only. Income tax benefits associated with the credit of excess deferred taxes are offset by corresponding revenue reductions.(c)State and local income taxes are primarily made up of the following jurisdictions: Minnesota, ColoradoComponents of income tax expense for years ended Dec. 31: (Millions of Dollars)202520242023Current federal tax (benefit) expense$(6)$36 $113 Current state tax expense2 28 16 Current change in unrecognized tax expense (benefit)1 2 (21)Deferred federal tax benefit(333)(510)(331)Deferred state tax expense96 46 75 Deferred change in unrecognized tax (benefit) expense(1)— 7 Deferred ITCs(4)(4)(5)Total income tax benefit$(245)$(402)$(146)Components of deferred income tax expense as of Dec.

Regulatory adjustments primarily relate to the credit of plant related excess deferred taxes to customers for tax rate increases as well as the capitalization of AFUDC equity for book purposes only. Income tax benefits associated with the credit of excess deferred taxes are offset by corresponding revenue reductions.

Incentive Plan Including Share-Based Compensation — Xcel Energy has authorized 13.0 million shares under the Xcel Energy Inc. 2024 Equity Incentive Plan for grants made on May 22, 2024 or later and 6.0 million shares under the Amended and Restated 2015 Omnibus Incentive Plan for grants made prior to May 22, 2024.Xcel Energy‘s Board of Directors has granted share based awards under these plans, which include various service, performance and market conditions. Following measurement at the end of a three-year restricted period settlement in shares or cash will occur if these conditions are met.Awards granted in 2023 and 2024 with conditions incremental to service requirements contain goals based on environmental performance or Xcel Energy TSR relative to a peer group of utility companies. For 2025, awards with conditions incremental to service contain goals based on EPS, operations and environmental performance, each with adjustments for relative TSR ranking.Equity award units granted to employees:(Units in Thousands)202520242023Granted units (a)683 658 586 Weighted average grant date fair value$68.19 $63.02 $67.06 (a)Includes 2025, 2024 and 2023 grants of 379, 457 and 413 units (each in thousands), respectively, subject only to service conditions.Equity awards vested:(Units in Thousands, Fair Value in Millions)202520242023Vested Units502 282 329 Total Fair Value$37 $19 $20 Changes in the nonvested portion of equity award units:(Units in Thousands)UnitsWeighted AverageGrant Date Fair ValueNonvested Units at Jan. 1, 20251,139 $64.55 Granted683 68.19 Forfeited(170)65.85 Vested(502)66.27 Dividend equivalents62 65.85 Nonvested Units at Dec. 31, 20251,212 65.77 Liability awards granted:(In Thousands)202520242023Awards granted (a)109 193 216 (a)All grants contain performance and/or market conditions.Liability awards settled:(Units In Thousands, Settlement Amount in Millions)202520242023Awards settled74 — 282 Settlement amount (cash, common stock and deferred amounts)$5 $— $19 The amount of cash used to settle liability awards in 2025 was $2 million.Stock Equivalent Units — Non-employee members of Xcel Energy‘s Board of Directors may elect to receive their annual equity grant as stock equivalent units in lieu of common stock. Each unit’s value is equal to one share of common stock. The annual equity grant is vested as of the date of each member’s election to the Board of Directors; there is no further service or other condition.

As described in Item 1A – Risk Factors, Xcel Energy operates in an industry that requires the continued operation of sophisticated information technology, control systems and network infrastructure, as such, our business is subject to the risk of interruption by cybersecurity incidents that range from attacks common to most industries, such as phishing and denial-of-service, to attacks from more sophisticated adversaries, including nation state actors, that target the critical infrastructure used in the operation of our business. The Company has a security risk program in place to identify, assess, manage and report material risks from cybersecurity incidents. As a utility provider, Xcel Energy complies with reliability standards imposed by NERC, including critical infrastructure protection standards related to both cybersecurity and physical security. These standards imposed by NERC, in alignment with the NIST Cybersecurity Framework, are the basis for which Xcel Energy has designed the cybersecurity control framework within its security risk program.Biennially, as part of Xcel Energy’s enterprise risk program, an integrated cybersecurity risk identification and assessment is completed across Xcel Energy’s business, including generation, transmission, distribution and fuel storage facilities, information technology systems and other infrastructure or physical assets as well as information processed in our systems (including systems hosted by third parties) that could be affected by cybersecurity incidents. This analysis includes the impact, likelihood, timeframe and controllability of cybersecurity risks and is presented to the Board of Directors. Management monitors and reviews the results of this analysis, integrating them into the enterprise risk assessment processes and implements appropriate mitigating actions as needed. Xcel Energy’s cybersecurity policies, standards, practices, annual cybersecurity training content and readiness are regularly assessed by third-party consultants. These partners are engaged to perform independent penetration testing and other security related services to assist in the prevention, detection, monitoring, mitigation and remediation of cybersecurity incidents and risks. The results of these assessments are communicated to management and the Board of Directors by the Chief Security Officer.Xcel Energy employs a comprehensive risk based approach to assess the magnitude and significance of a vendor’s risk to the Company.

Basic EPS was computed by dividing the earnings available to common shareholders by the weighted average number of common shares outstanding. Diluted EPS was computed by dividing the earnings available to common shareholders by the diluted weighted average number of common shares outstanding. Diluted EPS reflects the potential dilution that could occur if securities or other agreements to issue common stock (i.e., common stock equivalents) were settled. The weighted average number of potentially dilutive shares outstanding used to calculate diluted EPS is calculated using the treasury stock method.Common Stock Equivalents — Common stock equivalents include commitments to issue common stock related to forward equity agreements, collared equity agreements and time-based equity compensation awards. Stock equivalent units granted to Xcel Energy’s Board of Directors are included in common shares outstanding upon grant date as there is no further service, performance or market condition following the grant of these awards. Restricted stock issued to employees under the Executive Annual Incentive Award Plan is included in common shares outstanding when granted.Share-based compensation arrangements for which there is currently no dilutive impact to EPS include the following:•Equity awards subject to a performance condition; included in common shares outstanding when all necessary conditions for settlement have been satisfied by the end of the reporting period.•Liability awards subject to a performance condition; any portions settled in shares are included in common shares outstanding upon settlement.Common shares outstanding used in the basic and diluted EPS computation:(Shares in Millions)202520242023Basic 587 563552Diluted (a)589 563 552 (a)Diluted common shares outstanding included common stock equivalents of 2.1 million, 0.5 million, and 0.3 million shares for 2025, 2024 and 2023, respectively.