Overview

This financial report provides an overview of PG&E Corporation and the Pacific Gas and Electric Company (the Utility) for the three and nine months ended September 30, 2025. The key points are:

Financial Performance

• PG&E Corporation’s consolidated net income attributable to common shareholders was $823 million and $1,951 million for the three and nine months ended September 30, 2025, respectively, compared to $576 million and $1,828 million for the same periods in 2024.
• The Utility’s net income was $913 million and $2,220 million for the three and nine months ended September 30, 2025, respectively, compared to $618 million and $1,964 million for the same periods in 2024.
• The increase in net income was primarily due to higher revenues to recover costs associated with extended operations at Diablo Canyon Power Plant (DCPP) and interim rate relief authorized in the 2023 Wildfire Mitigation and Catastrophic Events (WMCE) proceeding, partially offset by lower interim rate relief from the Wildfire and Gas Safety Costs (WGSC) proceeding and expense disallowances from the 2022 WMCE final decision.

Revenue and Profit Trends

• Operating revenues increased by 5% and 2% in the three and nine months ended September 30, 2025, respectively, compared to the same periods in 2024. This was primarily due to increased revenues to recover costs associated with DCPP operations and 2023 WMCE interim rate relief, partially offset by lower interim rate relief from the WGSC proceeding and expense disallowances from the 2022 WMCE final decision.
• Cost of electricity and natural gas increased due to higher procurement costs and changes in volumes, but these costs are passed through to customers and do not impact net income.
• Operating and maintenance expenses decreased by 2% in the three months ended September 30, 2025 due to lower interim rate relief from the WGSC proceeding and reduced insurance costs, partially offset by costs associated with DCPP operations and previously deferred expenses authorized in the 2023 WMCE application. Operating and maintenance expenses increased by 1% in the nine months ended September 30, 2025 due to the same factors.
• Wildfire-related claims, net of recoveries, decreased by 99% in the three months ended September 30, 2025 due to lower charges related to the 2019 Kincade fire, but increased by 43% in the nine months ended September 30, 2025 due to higher charges related to the 2019 Kincade fire.
• Wildfire Fund expense decreased by 38% and 8% in the three and nine months ended September 30, 2025, respectively, due to lower accelerated amortization associated with the 2021 Dixie fire Wildfire Fund receivable.

Strengths and Weaknesses Strengths:

• Ability to recover costs through regulatory proceedings, including the Wildfire Fund and Continuation Account
• Diversified revenue streams from electric and natural gas operations
• Ongoing investments in safety and reliability improvements

Weaknesses:

• Significant exposure to wildfire-related liabilities and costs
• Uncertainty around regulatory cost recovery and the application of the revised prudency standard
• Potential for delays in ratemaking proceedings and the impact on cash flows

Outlook

• PG&E Corporation and the Utility expect to continue making significant investments in safety, reliability, and clean energy initiatives, which will require ongoing access to capital markets.
• The financial impact of future wildfires remains a key uncertainty, though the Wildfire Fund, Continuation Account, and regulatory cost recovery mechanisms provide some mitigation.
• Upcoming regulatory proceedings, such as the 2027 General Rate Case and 2026 Cost of Capital application, will be important in determining future revenue requirements and earnings potential.
• Continued focus on cost management and operational efficiency will be critical to maintaining financial performance.

Overall, PG&E Corporation and the Utility have made progress in improving their financial position and operational performance, but remain exposed to significant wildfire-related risks and regulatory uncertainties that could impact future results.