Segment Reporting

9 Months Ended

Sep. 30, 2019

The Company's segment structure reflects how management currently makes financial decisions and allocates resources. The Company's businesses are segregated into the Retail, Generation and corporate segments. Retail includes Mass customers and Business Solutions, which includes C&I customers and other distributed and reliability products. Intersegment sales are accounted for at market. Generation includes all power plant activities, domestic and international, as well as renewables. The financial information for the nine months ended September 30, 2018 has been recast to reflect the current segment structure.

On February 4, 2019, as described in Note 4, Acquisitions, Discontinued Operations and Dispositions, the Company completed the sale of and deconsolidated the South Central Portfolio. On August 31, 2018, as described in Note 4, Acquisitions, Discontinued Operations and Dispositions, NRG deconsolidated NRG Yield, Inc., its Renewables Platform and Carlsbad for financial reporting purposes. The financial information presented below has been recast to reflect the presentation of these entities as discontinued operations within the corporate segment.

NRG’s chief operating decision maker, its chief executive officer, evaluates the performance of its segments based on operational measures including adjusted earnings before interest, taxes, depreciation and amortization, or Adjusted EBITDA, free cash flow and capital for allocation, as well as net income/(loss) and net income/(loss) attributable to NRG Energy, Inc.


	Three months ended September 30, 2019 ^(a)
	Retail		Generation		Corporate		Eliminations		Total
	(In millions)
Operating revenues^(b)	$	2,544	$	974	$	—	$	(522)	$	2,996
Depreciation and amortization	37		47		7		—		91

Reorganization costs	1		—		—		—		1
(Loss)/gain on sale of assets	(1)		1		—		—		—
Equity in earnings of unconsolidated affiliates	—		29		—		—		29

Income/(loss) from continuing operations before income taxes	422		64		(107)		1		380
Income/(loss) from continuing operations	422		63		(112)		1		374
Loss from discontinued operations, net of tax	—		—		(2)		—		(2)
Net income/(loss)	422		63		(114)		1		372
Net income/(loss) attributable to NRG Energy, Inc.	$	422	$	63	$	(114)	$	1	$	372


^(a) Includes intersegment revenues and costs associated with the internal transfer of power, which is based on average annualized market prices and results in higher revenues in Generation and higher cost of operations in Retail that are eliminated in consolidation
^(b) Operating revenues include intersegment sales and net derivative gains and losses of:	$	1	$	513	$	8	$	—	$	522


	Three months ended September 30, 2018^(a)
	Retail		Generation		Corporate		Eliminations		Total
	(In millions)
Operating revenues^(b)	$	2,203	$	1,478	$	1	$	(722)	$	2,960
Depreciation and amortization	30		60		7		2		99

Reorganization costs	6		3		18		—		27
Equity in earnings of unconsolidated affiliates	—		20		3		(3)		20

Loss on debt extinguishment, net	—		—		(19)		—		(19)
(Loss)/income from continuing operations before income taxes	(128)		575		(145)		(7)		295
(Loss)/income from continuing operations	(128)		574		(152)		(7)		287
Loss from discontinued operations, net of tax	—		—		(336)		—		(336)
Net (loss)/income	(128)		574		(488)		(7)		(49)
Net (loss)/income attributable to NRG Energy, Inc.	$	(128)	$	559	$	(498)	$	(5)	$	(72)


^(a) Includes intersegment revenues and costs associated with our internal transfer of power, which is based on average annualized market prices and results in higher revenues in Generation and higher cost of operations in Retail that are eliminated in consolidation
^(b) Operating revenues include intersegment sales and net derivative gains and losses of:	$	1	$	739	$	(18)	$	—	$	722


	Nine months ended September 30, 2019 ^(a)
	Retail		Generation		Corporate		Eliminations		Total
	(In millions)
Operating revenues^(b)	$	5,899	$	3,164	$	—	$	(1,437)	$	7,626
Depreciation and amortization	100		138		23		—		261
Impairment losses	1		—		—		—		1
Reorganization costs	4		1		11		—		16
(Loss)/gain on sale of assets	(1)		2		1		—		2
Equity in earnings of unconsolidated affiliates	—		8		—		—		8
Loss on debt extinguishment, net	—		—		(47)		—		(47)
Income/(loss) from continuing operations before income taxes	253		795		(382)		—		666
Income/(loss) from continuing operations	252		794		(389)		—		657
Income from discontinued operations, net of tax	—		—		399		—		399
Net income	252		794		10		—		1,056
Net income attributable to NRG Energy, Inc. common stockholders	$	251	$	794	$	10	$	—	$	1,055


^(a) Includes intersegment revenues and costs associated with our internal transfer of power, which is based on average annualized market prices and results in higher revenues in Generation and higher cost of operations in Retail that are eliminated in consolidation
^(b)Operating revenues include inter-segment sales and net derivative gains and losses of:	$	6	$	1,375	$	56	$	—	$	1,437


	Nine months ended September 30, 2018 ^(a)
	Retail		Generation		Corporate		Eliminations		Total
	(In millions)
Operating revenues^(b)	$	5,497	$	2,916	$	—	$	(927)	$	7,486
Depreciation and amortization	86		220		25		—		331
Impairment losses	—		74		—		—		74
Reorganization costs	10		10		50		—		70
Gain on sale of assets	—		1		29		—		30
Equity in earnings of unconsolidated affiliates	—		27		4		(5)		26
Income/(loss) from continuing operations before income taxes	732		256		(412)		(4)		572
Income/(loss) from continuing operations	732		255		(430)		(4)		553
Loss from discontinued operations, net of tax	—		—		(272)		—		(272)
Net income/(loss)	732		255		(702)		(4)		281
Net income/(loss) attributable to NRG Energy, Inc. common stockholders	$	731	$	246	$	(697)	$	—	$	280


^(a) Includes intersegment revenues and costs associated with our internal transfer of power, which is based on average annualized market prices and results in higher revenues in Generation and higher cost of operations in Retail that are eliminated in consolidation
^(b)Operating revenues include inter-segment sales and net derivative gains and losses of:	$	7	$	944	$	(24)	$	—	$	927