CENTERPOINT ENERGY INC (CNP)

Item 2.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF CENTERPOINT ENERGY, INC. AND SUBSIDIARIES

The following combined discussion and analysis should be read in combination with the Interim Condensed Financial Statements contained in Item 1 herein and the Registrants’ combined 2025 Form 10-K. The discussion of CenterPoint Energy’s consolidated financial information includes the results of CenterPoint Energy Houston Electric, LLC and CenterPoint Energy Resources Corp., which, along with CenterPoint Energy, Inc. are collectively referred to as the Registrants. Where appropriate, information relating to a specific Registrant has been segregated and labeled as such. Unless the context indicates otherwise, specific references to Houston Electric and CERC also pertain to CenterPoint Energy. In this combined Form 10-Q, the terms “our,” “we” and “us” are used as abbreviated references to CenterPoint Energy, Inc. together with its consolidated subsidiaries, including Houston Electric and CERC, unless otherwise stated. No Registrant makes any representation as to the information relating to the other Registrants or the subsidiaries of CenterPoint Energy, Inc. other than itself or its subsidiaries.

RECENT EVENTS

Large-Load Customers. The PUCT has begun the process of implementing Texas Senate Bill 6 through various rulemaking processes, focused on establishing financial, operational, and interconnection requirements for large-load customers to ensure grid reliability and prevent stranded infrastructure costs. On June 18, 2026, the PUCT approved ERCOT’s Batch Zero process for large-user connection requests with the stated goal of ensuring large electricity users like data centers only connect in quantities and locations the Texas grid can reliably support. Houston Electric estimates that approximately 14 gigawatts of its potential large-load customers are eligible to be considered part of ERCOT’s Batch Zero process, including the execution of Facilities Extension Agreements with Houston Electric and posting of financial security. The amount of gigawatts ultimately connected to the Houston Electric system, the actual amount of electricity ultimately used by these customers, and the ultimate timing of these additional load connections and energization, if at all, remain uncertain due to a variety of factors, including, but not limited to ERCOT approval into Batch Zero, including into base load or studied load, timing of construction, potential legislative, regulatory, and other government actions, and availability of materials. In the third quarter of 2026, customers provided or committed approximately $900 million in either contributions in aid of construction or financial security to Houston Electric, a portion of which may be returned to large-load customers depending on project outcomes and contractual requirements. These amounts will continue to change as projects move through ERCOT reviews, load allocations are refined, and customers either advance toward construction and energization or exit the process.

Updated 10-Year Capital Plan. In July 2026, CenterPoint Energy announced an increase in its 10-year capital plan of $1.2 billion to reflect total planned capital expenditures of approximately $66.7 billion through 2035. The plan is expected to advance economic growth, enhance the experience of the Registrants’ customers and deliver consistent value for stakeholders across the Registrants’ jurisdictions.

Equity Distribution Agreement. On May 15, 2026, CenterPoint Energy entered into the 2026 Equity Distribution Agreement with respect to the offering and sale from time to time of shares of Common Stock, having an aggregate gross sales price of up to $1 billion. Sales of Common Stock under the 2026 Equity Distribution Agreement may be made by any method permitted by applicable law and deemed to be an “at the market offering” as defined in Rule 415 of the Securities Act. CenterPoint Energy may also enter into one or more forward sale agreements pursuant to master forward confirmations and related supplemental confirmations. Upon entry into the Equity Distribution Agreement, CenterPoint Energy terminated the previous at-the-market program pursuant to the 2024 Equity Distribution Agreement. For further information, see Note 15 to the Interim Condensed Financial Statements.

CenterPoint Energy Appointment of Chief Accounting Officer. On February 23, 2026, CenterPoint Energy announced the appointment of Russell K. Wright to the position of Vice President and Chief Accounting Officer of CenterPoint Energy, effective March 2, 2026.

Treasury Notice 2026-7. On February 18, 2026, Treasury Notice 2026-7 was issued. This notice allows an election to modify the computation of AFSI by including an adjustment to deduct certain repair and maintenance costs that are capitalized in the applicable financial statement.

TEEEF. In June 2025, Houston Electric entered into the ERCOT Transaction, subject to PUCT approval, to release its 15 large (27 MW to 32 MW) TEEEF units to ERCOT at CPS Energy facilities to serve the greater San Antonio region until March 2027 unless terminated earlier pursuant to the provisions of the ERCOT Transaction, reduce its TEEEF fleet capacity and reduce its rates to reflect removal of the large TEEEF units from its fleet. Following the completion of service in the San Antonio area, Houston Electric anticipates that it would complete one or more future transactions involving its large TEEEF units. As the large TEEEF units would not be available to serve Houston Electric customers during such time, Houston Electric plans to continue to not charge customers for these units for any future periods. In November 2025, Houston Electric proposed to remove its five medium (5.7 MW) TEEEF units and to remove the associated lease costs from its rates effective January 1,

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2026. On June 26, 2026, Houston Electric filed a stipulation and agreement supporting removal of the 15 large units and 5 medium units effective May 1, 2025 and January 1, 2026, respectively, an agreed motion for interim rates effective August 15, 2026, settlement testimony, and agreed motion to admit evidence and remand proceeding back to the PUCT. On June 29, 2026, SOAH granted the requested motions and remanded the proceeding to the PUCT. For additional information, see Note 6 to the Interim Condensed Financial Statements.

Regulatory Proceedings. For further information, see Note 6 to the Interim Condensed Financial Statements. For information related to our pending and completed regulatory proceedings to date in 2026, see “Liquidity and Capital Resources —Regulatory Matters” below.

Debt Transactions. For information about debt transactions to date in 2026, see Note 9 to the Interim Condensed Financial Statements.

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CENTERPOINT ENERGY CONSOLIDATED RESULTS OF OPERATIONS

For information regarding factors that may affect the future results of our consolidated operations, see “Risk Factors” in Part I, Item 1A of the Registrants’ combined 2025 Form 10-K.

Net income (loss) for the three and six months ended June 30, 2026 and 2025 was as follows:

(1)Includes unallocated corporate costs, interest income and interest expense and intercompany eliminations.

Three months ended June 30, 2026 compared to three months ended June 30, 2025

Net income increased $46 million primarily due to the following items:

•an increase in net income of $66 million for the Electric reportable segment, as further discussed below;

•a decrease in net income of $6 million for the Natural Gas reportable segment, as further discussed below; and

•an increase in net loss of $14 million for the Corporate and Other reportable segment, primarily due to a $21 million gain on the early extinguishment of debt recognized during the second quarter of 2025 that did not recur, an increase in operating expense and the unfavorable net impact of the mark-to-market valuations on the ZENS indexed debt securities derivative and ZENS-related securities, partially offset by $4 million from a release of a state unrecognized tax benefit upon statute of limitations expiration and $1 million of lower borrowing costs.

Six months ended June 30, 2026 compared to six months ended June 30, 2025

Net income increased $65 million primarily due to the following items:

•an increase in net income of $98 million for the Electric reportable segment, as further discussed below;

•an increase in net income of $16 million for the Natural Gas reportable segment, as further discussed below; and

•an increase in net loss of $49 million for the Corporate and Other reportable segment, due to an $18 million tax benefit recognized in 2025 related to the sale of the Louisiana and Mississippi natural gas businesses that did not recur, a $21 million accrued tax expense related to the anticipated divestiture of the Ohio natural gas business expected to close in the fourth quarter of 2026, a $21 million gain on the early extinguishment of debt recognized in 2025 that did not recur, and the unfavorable net impact of the mark-to-market valuations on the ZENS indexed debt securities derivative and ZENS-related securities, partially offset by a $4 million release of a state unrecognized tax benefit upon the expiration of the statute of limitations. The remaining variance is primarily driven by income taxes and intersegment interest.

Income Tax Expense. For a discussion of effective tax rate per period, see Note 10 to the Interim Condensed Financial Statements.

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CENTERPOINT ENERGY’S RESULTS OF OPERATIONS BY REPORTABLE SEGMENT

CenterPoint Energy’s CODM views net income as the measure of profit or loss for the reportable segments. Segment results include inter-segment interest income and expense, which may result in inter-segment profit and loss.

The following discussion of CenterPoint Energy’s results of operations is further separated into two reportable segments, Electric and Natural Gas.

Electric (CenterPoint Energy)

For information regarding factors that may affect the future results of operations of CenterPoint Energy’s Electric reportable segment, see “Risk Factors — Risk Factors Affecting Operations — Electric Generation, Transmission and Distribution,” “— Risk Factors Affecting Regulatory, Environmental and Legal Risks,” “— Risk Factors Affecting Financial, Economic and Market Risks,” “— Risk Factors Affecting Safety and Security Risks” and “— General and Other Risks” in Part I, Item 1A of the Registrants’ combined 2025 Form 10-K.

The following table provides summary data of CenterPoint Energy’s Electric reportable segment:

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Item 7.Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following combined discussion and analysis should be read in combination with the consolidated financial statements included in Item 8 herein. The discussion of CenterPoint Energy’s consolidated financial information includes the results of CenterPoint Energy Houston Electric, LLC and CenterPoint Energy Resources Corp., which, along with CenterPoint Energy, Inc., are collectively referred to as the Registrants. Where appropriate, information relating to a specific Registrant has been segregated and labeled as such. Unless the context indicates otherwise, specific references to Houston Electric and CERC also pertain to CenterPoint Energy. In this combined Form 10-K, the terms “our,” “we” and “us” are used as abbreviated references to CenterPoint Energy, Inc. together with its consolidated subsidiaries, including Houston Electric and CERC, unless otherwise stated. No Registrant makes any representation as to the information relating to the other Registrants or the subsidiaries of CenterPoint Energy, Inc. other than itself or its subsidiaries.

OVERVIEW

Background

CenterPoint Energy is a public utility holding company. CenterPoint Energy’s operating subsidiaries own and operate electric transmission, distribution and generation facilities and natural gas distribution systems. For a detailed description of CenterPoint Energy’s operating subsidiaries, see Note 1 to the consolidated financial statements.

Houston Electric is an indirect, wholly-owned subsidiary of CenterPoint Energy, which provides electric transmission service to transmission service customers in the ERCOT region and distribution service to REPs serving the Texas Gulf Coast area that includes the city of Houston.

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CERC Corp. is an indirect, wholly-owned subsidiary of CenterPoint Energy, which (i) directly owns and operates natural gas distribution systems in Minnesota and Texas, (ii) indirectly, through Indiana Gas and CEOH, owns and operates natural gas distribution systems in Indiana and Ohio, respectively, and (iii) owns and operates permanent pipeline connections through interconnects with various interstate and intrastate pipeline companies through CEIP.

On October 20, 2025, CenterPoint Energy, through its subsidiary CERC Corp., entered into the Ohio Securities Purchase Agreement to sell all of the issued and outstanding equity interests in CEOH. The transaction is expected to close in the fourth quarter of 2026, subject to the satisfaction of customary closing conditions. For further information, see Note 4 to the consolidated financial statements.

Reportable Segments

We discuss our operating results on a consolidated basis and individually for each of our reportable segments. We are first and foremost an energy delivery company and it is our intention to remain focused on these regulated segments. The results of our business operations are significantly impacted by weather, customer growth, economic conditions, cost management, competition, rate proceedings before regulatory agencies and other actions of the various regulatory agencies to whose jurisdiction we are subject, among other factors.

Below is a summary of CenterPoint Energy’s reportable segments as of December 31, 2025. For a detailed description of each reportable segment, as well as the assets included in each reportable segment, see Part I, Item 1. Business and Item 2. Properties.

•The Electric reportable segment consisted of electric transmission and distribution services in the Texas Gulf Coast area in the ERCOT region and electric transmission and distribution services primarily to southwestern Indiana and includes power generation and wholesale power operations in the MISO region.

•The Natural Gas reportable segment consisted of (i) intrastate natural gas sales to, and natural gas transportation and distribution for, residential, commercial and industrial customers in Indiana, Minnesota, Ohio and Texas; (ii) permanent pipeline connections through interconnects with various interstate and intrastate pipeline companies through CEIP; (iii) residential appliance repair and maintenance services along with HVAC equipment sales to customers in Minnesota; and (iv) home repair protection plans to natural gas customers in Indiana, Ohio and Texas through a third party. The Louisiana and Mississippi natural gas LDC businesses were included in the Natural Gas reportable segment through March 31, 2025. See Note 4 for additional detail.

•The Corporate and Other reportable segment consisted of (i) energy performance contracting and sustainable infrastructure services by Energy Systems Group through June 30, 2023, the date of the sale of Energy Systems Group; (ii) corporate support operations that support all of CenterPoint Energy’s business operations; and (iii) office buildings and other real estate used for business operations.

Houston Electric and CERC each consist of a single reportable segment.

EXECUTIVE SUMMARY

We expect our businesses to continue to be affected by the key factors and trends discussed below. Our expectations are based on assumptions made by us and information currently available to us. To the extent our underlying assumptions about, or interpretations of, available information prove to be incorrect, our actual results may vary materially from our expected results.

Factors Influencing Our Businesses and Industry Trends

We are an energy delivery company with electric transmission, distribution and generation operations and natural gas distribution operations that serve more than seven million metered customers across four states. The majority of our revenues are generated from the transmission and delivery of electricity and the sale of natural gas by our subsidiaries.

We continue to execute on our strategic goals for our businesses that were set in September 2025. Pursuant to this business strategy and in light of the nature of our businesses, significant capital investments are reflected in our new 10-year capital plan. In September 2025, we announced our new 10-year capital plan to invest $65 billion from 2026 through 2035, inclusive of a $2 billion increase in previously planned capital expenditures through 2030, and in February 2026, we announced an additional increase to reflect total expenditures of approximately $65.5 billion. Our 10-year capital plan is intended to advance economic

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growth, improve the experience of our customers through enhancing the safety, reliability and resiliency of our systems and deliver consistent value for stakeholders across the jurisdictions in which we operate. These investments are not only intended to meet our customers’ current needs, but are also in anticipation of future organic growth from a diverse set of economic drivers. This organic growth is anticipated to result in rapid load growth in our service territories (as further discussed below). To fund these capital investments, we rely on internally-generated cash, borrowings under our credit facilities, proceeds from commercial paper, cash proceeds from strategic transactions (such as our Energy Systems Group divestiture in 2023, the sale of our Louisiana and Mississippi natural gas LDC businesses in 2025 and the announced sale of our Ohio natural gas LDC business, which is expected to close in the fourth quarter of 2026) and issuances of equity and debt securities in the capital markets, including the issuance of non-recourse system restoration bonds at Houston Electric to recover costs incurred primarily during the year ended December 31, 2024 due to the May 2024 Storm Events, as well as Hurricane Beryl and other significant storms.

We strive to maintain investment grade ratings for our debt securities to access the capital markets on terms we consider reasonable. A reduction in our ratings generally would result in an increase in our borrowing costs for new issuances of debt, as well as borrowing costs under our existing revolving credit facilities, and may prevent us from accessing the commercial paper markets. Disruptions in the financial markets along with high or rising interest rates can also affect the availability of external financing on terms we consider attractive. In those circumstances, we may not be able to obtain certain types of external financing or may be required to accept terms less favorable than we would otherwise accept which, among other things, would negatively impact our ability to finance our capital plan. For that reason, we seek to maintain adequate liquidity for our businesses through existing credit facilities and prudent refinancing of existing debt.

Approximately 85% of our rate base has been subject to a rate case since the beginning of 2023, which supports clarity and stability through 2029 with final orders improving enterprise weighted average returns on equity. Additionally, approximately 85% of CenterPoint Energy’s projected consolidated investments are expected to be recovered through interim capital recovery trackers or rate cases based on a forward test year. For additional detail, see “—Liquidity and Capital Resources —Regulatory Matters” below.

To assess our financial performance, our management primarily monitors the recovery of costs and return on investments by evaluating net income and capital expenditures, among other metrics, from our regulated service territories within our reportable segments. Within these broader financial measures, we monitor margins, natural gas and fuel costs, interest expense, capital spend, working capital requirements and operation and maintenance expense, among other significant metrics. In addition to these financial measures, we also monitor a number of variables that management considers important to gauge the performance of our reportable segments, including the number of customers, throughput, commodity prices, heating and cooling degree days, safety factors, system reliability and customer satisfaction.

CenterPoint Energy and CERC have weather normalization or other rate mechanisms that largely mitigate the impact of weather on their natural gas distribution businesses in Indiana, Minnesota and Ohio, as applicable. CenterPoint Energy’s and CERC’s natural gas distribution businesses in Texas and CenterPoint Energy’s electric operations in Texas and Indiana do not have such mechanisms. As a result, fluctuations from normal weather may have a positive or negative effect on CenterPoint Energy’s and CERC’s natural gas distribution business’ results in Texas and on CenterPoint Energy’s electric operations’ results in its Texas and Indiana service territories.

Management anticipates significant growth in electric demand over the next decade, especially in our Houston Electric territory where we forecast a nearly 50% increase in peak electric load demand to over 30 GW by 2029 and the demand nearly doubling by the mid 2030s, as compared to 2024. It is expected that the significant forecasted growth in this service territory will be driven by a diverse set of economic drivers, including data centers, energy refining and exports, advanced manufacturing and logistics. Management additionally believes that there are increased electric demand opportunities in our Indiana Electric jurisdiction; accordingly, Indiana Electric’s 2025 IRP included a large load scenario with a corresponding alternative preferred portfolio. Additionally, management expects residential meter growth for Houston Electric to remain in line with long-term trends at approximately 2% annually. As discussed above, a significant portion of the planned investments in our new 10-year capital plan are intended to support this growth. There is significant uncertainty with respect to the forecasted load growth and our ability to capitalize on the opportunities presented by these developments. For more information regarding such risks, see Part I, Item 1A. “Risk Factors — Genera

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