JCP&L's Revenue Jumps 11% Amid Rising Operating Costs

TL;DR

**JCP&L is powering up with solid revenue growth, but rising operating costs are a yellow flag for future profitability.**

AI Summary

JERSEY CENTRAL POWER & LIGHT CO (JCP&L) reported a significant increase in total revenues for the three months ended September 30, 2025, reaching $4,148 million, up from $3,729 million in the prior year, representing an 11.2% increase. For the nine months ended September 30, 2025, total revenues climbed to $11,293 million from $10,296 million in 2024, a 9.7% rise. Operating income for the three-month period increased to $830 million from $727 million, while for the nine-month period, it grew to $2,230 million from $1,762 million. This growth was primarily driven by higher distribution services and retail generation revenues, which increased by $304 million to $3,373 million for the quarter, and transmission revenues, which rose by $36 million to $592 million. Operating expenses also saw an increase, with purchased power costs rising by $255 million to $1,341 million for the quarter, and fuel costs increasing by $24 million to $163 million. The company is actively engaged in its 'EnergizeNJ' infrastructure investment program, aiming to enhance reliability and modernize its distribution system. Risks include potential liabilities from government investigations related to HB 6, changes in economic conditions, and severe weather events impacting operations and costs.

Why It Matters

JCP&L's robust revenue growth of 11.2% for the quarter and 9.7% year-to-date signals strong demand for its distribution and transmission services, which is positive for investors. However, the concurrent rise in purchased power and fuel costs could compress margins if not managed effectively, impacting profitability. The ongoing 'EnergizeNJ' infrastructure investments are crucial for modernizing the grid, benefiting customers through improved reliability and potentially creating competitive advantages against other utilities in the region. For employees, these investments likely mean job stability and opportunities in infrastructure development. The broader market will watch how JCP&L balances growth with cost control, especially given the competitive landscape in the utility sector and the increasing focus on grid resilience.

Risk Assessment

Risk Level: medium — The filing highlights 'potential liabilities, increased costs and unanticipated developments resulting from government investigations and agreements, including those associated with compliance with or failure to comply with the DPA, and settlements with the OAG's office and the SEC' related to HB 6. This ongoing regulatory scrutiny and potential financial penalties, combined with the 'risks and uncertainties associated with litigation, arbitration, mediation and similar proceedings, particularly regarding HB 6 related matters,' present a material financial and reputational risk.

Analyst Insight

Investors should monitor JCP&L's progress in managing its operating expenses, particularly purchased power and fuel costs, which increased significantly. While revenue growth is strong, sustained cost increases could erode profitability. Additionally, keep an eye on any developments regarding the HB 6 investigations, as adverse outcomes could impact future financial performance and regulatory relationships.

Financial Highlights

revenue

$4,148M

operating Margin

20.0%

net Income

$532M

eps

$0.76

cash Position

$1,404M

revenue Growth

+11.2%

Revenue Breakdown

Key Numbers

• $4,148M — Total revenues for Q3 2025 (Increased from $3,729M in Q3 2024, an 11.2% rise)
• $11,293M — Total revenues for YTD Q3 2025 (Increased from $10,296M in YTD Q3 2024, a 9.7% rise)
• $830M — Operating income for Q3 2025 (Increased from $727M in Q3 2024)
• $2,230M — Operating income for YTD Q3 2025 (Increased from $1,762M in YTD Q3 2024)
• $3,373M — Distribution services and retail generation revenues for Q3 2025 (Increased by $304M from Q3 2024)
• $592M — Transmission revenues for Q3 2025 (Increased by $36M from Q3 2024)
• $1,341M — Purchased power expenses for Q3 2025 (Increased by $255M from Q3 2024)
• $163M — Fuel expenses for Q3 2025 (Increased by $24M from Q3 2024)
• 13,628,447 — Common Stock, $10 par value shares outstanding for JCP&L (All held by FirstEnergy Corp. as of September 30, 2025)
• 577,665,555 — Common Stock, $0.10 par value shares outstanding for FirstEnergy Corp. (As of September 30, 2025)

Key Players & Entities

• JERSEY CENTRAL POWER & LIGHT CO (company) — Registrant and wholly owned New Jersey electric power company subsidiary of FE
• FIRSTENERGY CORP. (company) — Public electric power holding company and parent of JCP&L
• U.S. Securities and Exchange Commission (regulator) — Regulator for SEC filings and involved in HB 6 settlements
• Ohio Attorney General (regulator) — Involved in settlements related to HB 6
• HB 6 (other) — Ohio House Bill 6, a source of government investigations and litigation risks
• EnergizeNJ (other) — JCP&L's second Infrastructure Investment Program
• Brookfield North American Transmission Company II L.P. (company) — Controlled investment vehicle entity of Brookfield Infrastructure Partners, involved in FET Equity Interest Sale
• PJM Interconnection, LLC (company) — RTO serving the PJM Region, coordinating electricity movement
• Valley Link Transmission Company, LLC (company) — Holding company formed by FET, Dominion High Voltage MidAtlantic, Inc., and Transource Energy, LLC
• New Jersey Board of Public Utilities (regulator) — NJBPU, relevant for JCP&L's regulatory environment

FAQ

Risk Factors

• Government Investigations (HB 6) [high — legal]: Potential liabilities may arise from government investigations related to HB 6. The company is actively involved in these proceedings, which could result in significant financial penalties or operational changes.
• Economic Conditions [medium — market]: Changes in economic conditions can impact energy demand and customer payment patterns. A downturn could lead to reduced revenues and increased uncollectible accounts.
• Severe Weather Events [medium — operational]: Severe weather events can disrupt operations, damage infrastructure, and increase costs for repairs and restoration. This can lead to significant unplanned expenses and potential service interruptions.
• Regulatory Environment [medium — regulatory]: Changes in regulations, including environmental standards and energy policies, can affect operating costs and investment strategies. Compliance with new or evolving regulations requires continuous monitoring and adaptation.

Industry Context

The utility sector, particularly for electric power distribution and generation, is characterized by significant capital investment in infrastructure modernization and reliability. Companies like JCP&L are navigating evolving regulatory landscapes, increasing demands for cleaner energy, and the need to harden systems against climate change impacts. Competition is generally localized due to the nature of regulated service territories, but innovation in grid technology and customer service is becoming a key differentiator.

Regulatory Implications

JCP&L operates within a heavily regulated environment where rate decisions, environmental compliance, and infrastructure approval are subject to state and federal oversight. The 'EnergizeNJ' program highlights a proactive approach to regulatory requirements for system upgrades. However, potential liabilities from investigations like HB 6 pose significant regulatory and legal risks.

What Investors Should Do

1. Monitor the impact of the 'EnergizeNJ' program on capital expenditures and future rate cases.
2. Closely track developments in the HB 6 investigation and any potential financial or operational repercussions.
3. Analyze the drivers of increased purchased power and fuel costs.

Glossary

Amortization (deferral) of regulatory assets, net

The process of spreading the cost of regulatory assets over their useful life, or in this case, reflecting the net effect of deferring and then amortizing certain regulatory-related costs. (A positive $89M in Q3 2025 indicates a favorable regulatory accounting treatment impacting income, a significant swing from a negative $33M in Q3 2024.)

Noncontrolling interest

The portion of equity interest in a subsidiary that is not attributable to the parent company. It represents the ownership stake of outside shareholders in a consolidated entity. (Income attributable to noncontrolling interest was $91M in Q3 2025, impacting the net income available to FirstEnergy Corp. shareholders.)

Regulatory assets

Costs that have been incurred by a utility company but have not yet been recovered from customers through rates. These are typically recognized when regulators allow the company to recover these costs in the future. (The amortization of these assets (or deferrals) directly impacts the company's reported income.)

Year-Over-Year Comparison

Total revenues for JCP&L saw a robust increase of 11.2% to $4,148 million in Q3 2025 compared to Q3 2024, driven by higher distribution, retail generation, and transmission revenues. Operating income also grew significantly by 14.2% to $830 million. While operating expenses rose, particularly for purchased power, the revenue growth outpaced these increases. New risks related to government investigations (HB 6) have emerged as a key concern, alongside ongoing risks from economic conditions and severe weather.

Key Financial Figures

• $0.10 — stered FirstEnergy Corp. Common Stock, $0.10 par value FE New York Stock Exchange
• $10 — ral Power & Light Company Common Stock, $10 par value 13,628,447 , all held by Firs

Filing Documents

• fe-20250930.htm (10-Q) — 4159KB
• ex105-q32025.htm (EX-10.5) — 125KB
• ex106-q32025.htm (EX-10.6) — 128KB
• ex107-q32025.htm (EX-10.7) — 128KB
• ex108-q32025.htm (EX-10.8) — 125KB
• ex109-q32025.htm (EX-10.9) — 123KB
• ex1010-q32025.htm (EX-10.10) — 130KB
• ex1011-q32025.htm (EX-10.11) — 128KB
• ex1012-q32025.htm (EX-10.12) — 132KB
• exhibit311-q32025xfe.htm (EX-31.1) — 11KB
• exhibit311-q32025xjcpl.htm (EX-31.1) — 10KB
• exhibit312-q32025xfe.htm (EX-31.1) — 11KB
• exhibit312-q32025xjcpl.htm (EX-31.2) — 10KB
• exhibit32-q32025xfe.htm (EX-32) — 8KB
• exhibit32-q32025xjcpl.htm (EX-32) — 8KB
• fe-20250930_g1.jpg (GRAPHIC) — 14KB
• fe-20250930_g2.jpg (GRAPHIC) — 17KB
• 0001031296-25-000085.txt ( ) — 18592KB
• fe-20250930.xsd (EX-101.SCH) — 105KB
• fe-20250930_cal.xml (EX-101.CAL) — 92KB
• fe-20250930_def.xml (EX-101.DEF) — 677KB
• fe-20250930_lab.xml (EX-101.LAB) — 1020KB
• fe-20250930_pre.xml (EX-101.PRE) — 839KB
• fe-20250930_htm.xml (XML) — 3210KB

Forward-Looking Statements vi

Forward-Looking Statements vi

Financial Information

Part I. Financial Information

Financial Statements

Item 1. Financial Statements FirstEnergy Corp. Consolidated Statements of Income 1 Consolidated Statements of Comprehensive Income 2 Consolidated Balance Sheets 3 Consolidated Statements of Equity 4 Consolidated Statements of Cash Flows 6 Jersey Central Power & Light Company 7 Balance Sheets 8 9 10 Combined Notes To Financial Statements of the Registrants 11

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 53 FirstEnergy Corp. Management's Discussion and Analysis of Financial Condition and Results of Operations 53 Jersey Central Power & Light Company Management's Narrative Discussion and Analysis of Results of Operations 94

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk 103

Controls and Procedures

Item 4. Controls and Procedures 103

Other Information

Part II. Other Information

Legal Proceedings

Item 1. Legal Proceedings 103

Risk Factors

Item 1A. Risk Factors 103

Unregistered Sales of Equity Securities and Use of Proceeds 103

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 103

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities 103

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 103

Other Information

Item 5. Other Information 103

Exhibits

Item 6. Exhibits 104 i GLOSSARY OF TERMS The following abbreviations and acronyms are used in this report to identify FirstEnergy Corp. and its current and former subsidiaries, including JCP&L: AE Supply Allegheny Energy Supply Company, LLC, a wholly owned unregulated generation subsidiary of FE AGC Allegheny Generating Company, a wholly owned generation subsidiary of MP ATSI American Transmission Systems, Incorporated, a wholly owned transmission subsidiary of FET CEI The Cleveland Electric Illuminating Company, a wholly owned Ohio electric power company subsidiary of FE Electric Companies OE, CEI, TE, FE PA, JCP&L, MP and PE FE FirstEnergy Corp., a public electric power holding company FE PA FirstEnergy Pennsylvania Electric Company, a wholly owned Pennsylvania electric power company subsidiary of FirstEnergy Pennsylvania Holding Company LLC, a wholly owned subsidiary of FE FESC FirstEnergy Service Company, which provides legal, financial and other corporate support services FET FirstEnergy Transmission, LLC a consolidated VIE of FE, and the parent company of ATSI, MAIT and TrAIL, and having a joint venture in PATH and Valley Link FEV FirstEnergy Ventures Corp., which invests in certain unregulated enterprises and business ventures FirstEnergy FirstEnergy Corp., together with its consolidated subsidiaries Global Holding Global Mining Holding Company, LLC, a joint venture between FEV, WMB Marketing Ventures, LLC and Pinesdale LLC JCP&L Jersey Central Power & Light Company, a wholly owned New Jersey electric power company subsidiary of FE KATCo Keystone Appalachian Transmission Company, a wholly owned transmission subsidiary of FE MAIT Mid-Atlantic Interstate Transmission, LLC, a wholly owned transmission subsidiary of FET ME Metropolitan Edison Company, a former wholly owned Pennsylvania electric power company subsidiary of FE, which merged with and into FE PA on January 1, 2024 MP Monongahela Power Company, a wholly owned West Virginia elec

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION ITEM I. Financial Statements FIRSTENERGY CORP. CONSOLIDATED STATEMENTS OF INCOME (Unaudited) For the Three Months Ended September 30, For the Nine Months Ended September 30, (In millions, except per share amounts) 2025 2024 2025 2024 REVENUES: Distribution services and retail generation $ 3,373 $ 3,069 $ 9,152 $ 8,381 Transmission 592 556 1,740 1,650 Other 183 104 401 265 Total revenues (1) 4,148 3,729 11,293 10,296 OPERATING EXPENSES: Fuel 163 139 480 372 Purchased power 1,341 1,086 3,382 2,999 Other operating expenses 976 1,099 3,005 3,275 Provision for depreciation 417 400 1,243 1,178 Amortization (deferral) of regulatory assets, net 89 ( 33 ) ( 20 ) ( 205 ) General taxes 332 311 973 915 Total operating expenses 3,318 3,002 9,063 8,534 OPERATING INCOME 830 727 2,230 1,762 OTHER INCOME (EXPENSE): Debt redemption costs (Note 6) — — ( 24 ) ( 85 ) Equity method investment earnings, net (Note 1) — 21 — 64 Miscellaneous income, net 41 53 118 156 Interest expense ( 312 ) ( 276 ) ( 899 ) ( 866 ) Capitalized financing costs 51 35 131 94 Total other expense ( 220 ) ( 167 ) ( 674 ) ( 637 ) INCOME BEFORE INCOME TAXES 610 560 1,556 1,125 INCOME TAXES 78 94 292 294 NET INCOME $ 532 $ 466 $ 1,264 $ 831 Income attributable to noncontrolling interest 91 47 195 114 EARNINGS ATTRIBUTABLE TO FIRSTENERGY CORP. $ 441 $ 419 $ 1,069 $ 717 EARNINGS PER SHARE ATTRIBUTABLE TO FIRSTENERGY CORP. (Note 3): Basic $ 0.76 $ 0.73 $ 1.85 $ 1.25 Diluted $ 0.76 $ 0.73 $ 1.85 $ 1.24 WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING: Basic 577 576 577 575 Diluted 578 577 578 576 (1) Includes excise and gross receipts tax collections of $ 126 million and $ 116 million during the three months ended September 30, 2025 and 2024, respectively, and $ 349 million and $ 329 million during the nine months ended September 30, 2025 and 2024, respectively. See Combined Notes to Financial Statements of the Registrants.

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