Delmarva Power's Q3 Net Income Jumps 24% on Strong Revenue Growth

TL;DR

**Delmarva Power is a solid buy, showing strong earnings growth and robust cash flow in a stable utility market.**

AI Summary

DELMARVA POWER & LIGHT CO /DE/ (DPL) reported a net income of $875 million for the three months ended September 30, 2025, an increase of 23.8% from $707 million in the same period of 2024. For the nine months ended September 30, 2025, net income attributable to common shareholders rose to $2,174 million, up 19.9% from $1,813 million in 2024. Total operating revenues for the three months increased to $6,705 million from $6,154 million, driven by a rise in electric operating revenues to $6,690 million from $6,012 million. Natural gas operating revenues also saw an increase to $235 million from $196 million. However, revenues from alternative revenue programs decreased significantly to $(220) million from $(54) million. Operating expenses increased to $5,205 million from $4,961 million, primarily due to higher purchased power costs of $2,645 million, up from $2,349 million. Interest expense, net, also increased to $(531) million from $(490) million. The company's cash and cash equivalents significantly increased to $1,533 million as of September 30, 2025, from $357 million at December 31, 2024, with net cash flows provided by operating activities reaching $5,010 million for the nine months.

Why It Matters

This strong financial performance from Delmarva Power & Light, a subsidiary of Exelon, indicates robust operational health within the regulated utility sector. For investors, the significant increase in net income and operating revenues suggests stable and growing returns, reinforcing the attractiveness of utility stocks in a volatile market. Employees benefit from a financially sound company, potentially leading to job security and investment in infrastructure. Customers could see continued investment in grid reliability and service improvements, though alternative revenue program decreases might signal shifts in pricing structures. Competitively, DPL's growth underscores the resilience of regulated utilities against market fluctuations, potentially drawing more capital into the sector.

Risk Assessment

Risk Level: medium — While DPL shows strong financial performance, the filing highlights 'unfavorable legislative and/or regulatory actions' and 'uncertainty as to outcomes and timing of regulatory approval proceedings' as key risks. The significant negative 'Revenues from alternative revenue programs' at $(220) million for the three months ended September 30, 2025, compared to $(54) million in 2024, indicates potential regulatory or programmatic shifts that could impact future revenue streams. Additionally, 'physical security and cybersecurity risks' are noted, which are inherent to critical infrastructure operators.

Analyst Insight

Investors should consider DPL, and by extension, its parent Exelon (EXC), as a stable investment given its strong earnings growth and operating cash flow. Monitor regulatory developments, especially regarding 'alternative revenue programs,' as these could influence future profitability. The increase in cash and cash equivalents to $1,533 million suggests strong liquidity, which is a positive indicator for long-term stability.

Financial Highlights

revenue

$18,846M

operating Margin

21.0%

net Income

$2,174M

eps

$2.15

cash Position

$1,533M

revenue Growth

+7.3%

Revenue Breakdown

Key Numbers

• $875M — Net Income (Q3 2025) (Increased 23.8% from $707M in Q3 2024)
• $2.17B — Net Income (YTD 2025) (Increased 19.9% from $1.81B in YTD 2024)
• $6.71B — Total Operating Revenues (Q3 2025) (Increased from $6.15B in Q3 2024)
• $6.69B — Electric Operating Revenues (Q3 2025) (Increased from $6.01B in Q3 2024)
• $235M — Natural Gas Operating Revenues (Q3 2025) (Increased from $196M in Q3 2024)
• $(220)M — Revenues from Alternative Revenue Programs (Q3 2025) (Decreased significantly from $(54)M in Q3 2024)
• $5.21B — Total Operating Expenses (Q3 2025) (Increased from $4.96B in Q3 2024)
• $2.65B — Purchased Power (Q3 2025) (Increased from $2.35B in Q3 2024)
• $5.01B — Net Cash Flows from Operating Activities (YTD 2025) (Increased from $4.14B in YTD 2024)
• $1.53B — Cash and Cash Equivalents (Sept 30, 2025) (Increased from $357M at Dec 31, 2024)

Key Players & Entities

• DELMARVA POWER & LIGHT CO /DE/ (company) — Registrant in 10-Q filing
• Exelon Corporation (company) — Parent company and primary registrant
• SEC (regulator) — United States Securities and Exchange Commission
• $875 million (dollar_amount) — Net income for three months ended September 30, 2025
• $707 million (dollar_amount) — Net income for three months ended September 30, 2024
• $2,174 million (dollar_amount) — Net income for nine months ended September 30, 2025
• $1,813 million (dollar_amount) — Net income for nine months ended September 30, 2024
• $6,705 million (dollar_amount) — Total operating revenues for three months ended September 30, 2025
• $6,154 million (dollar_amount) — Total operating revenues for three months ended September 30, 2024
• $5,010 million (dollar_amount) — Net cash flows provided by operating activities for nine months ended September 30, 2025

FAQ

Risk Factors

• Regulatory Environment Changes [high — regulatory]: Changes in laws, regulations, and regulatory policies, including environmental regulations and energy policies, can impact operating costs and revenue. The company's operations are subject to extensive regulation by federal, state, and local agencies, and adverse changes could significantly affect financial performance.
• Commodity Price Volatility [medium — market]: Fluctuations in the prices of natural gas and electricity, as well as fuel for generation, can significantly impact operating expenses and revenues. The company's hedging strategies aim to mitigate some of this volatility, but substantial price swings can still affect profitability.
• Infrastructure Reliability and Security [high — operational]: The company's ability to deliver reliable energy services depends on the integrity of its infrastructure. Extreme weather events, cyberattacks, or physical security breaches could disrupt operations, leading to significant repair costs and potential revenue losses.
• Interest Rate Risk [medium — financial]: As of September 30, 2025, the company had significant debt. Changes in interest rates can affect the cost of borrowing and the fair value of its debt. The increase in interest expense to $(531) million in Q3 2025 from $(490) million in Q3 2024 highlights this sensitivity.
• Litigation and Legal Proceedings [low — legal]: The company is involved in various legal proceedings and litigation. Adverse outcomes in these matters could result in significant financial liabilities, reputational damage, and operational disruptions.

Industry Context

The utility sector is characterized by stable, regulated revenues but faces increasing pressure from decarbonization efforts and the need for grid modernization. Delmarva Power & Light operates in a competitive landscape where reliability, affordability, and environmental sustainability are key differentiators. Trends include the integration of renewable energy sources and investments in smart grid technologies.

Regulatory Implications

Delmarva Power & Light operates under strict regulatory oversight, primarily from state public utility commissions. Changes in rate-setting methodologies, environmental mandates, or energy policies can significantly impact financial performance and require substantial capital investment for compliance.

What Investors Should Do

1. Monitor regulatory filings and decisions
2. Analyze purchased power cost trends
3. Assess capital expenditure plans
4. Evaluate the impact of alternative revenue programs

Glossary

Operating revenues

The total income generated from the company's primary business activities, such as selling electricity and natural gas. (Indicates the top-line performance and market demand for the company's services.)

Purchased power

The cost incurred by the company to buy electricity from external sources to meet customer demand. (A significant operating expense that directly impacts profitability, especially with its increase to $2,645 million in Q3 2025.)

Interest expense, net

The cost of borrowing money, minus any interest income earned. (Reflects the company's debt servicing costs, which increased to $(531) million in Q3 2025.)

Net income attributable to common shareholders

The profit remaining after all expenses, taxes, and preferred stock dividends have been paid, belonging to common stockholders. (The bottom-line profitability measure for common shareholders, showing a strong increase to $875 million in Q3 2025.)

Cash flows from operating activities

The cash generated or used by the normal day-to-day business operations of the company. (Indicates the company's ability to generate cash from its core business, with $5,010 million for the nine months ended September 30, 2025.)

Cash and cash equivalents

Highly liquid investments that can be readily converted into cash, including currency on hand, bank deposits, and short-term marketable securities. (Represents the company's immediate liquidity, which significantly increased to $1,533 million as of September 30, 2025.)

Year-Over-Year Comparison

Delmarva Power & Light Co. (DPL) shows a strong performance improvement compared to the prior year. Total operating revenues for the nine months ended September 30, 2025, increased by 7.3% to $18,846 million from $17,557 million in 2024. Net income attributable to common shareholders also saw a substantial rise of 19.9%, reaching $2,174 million from $1,813 million. While operating expenses increased, driven by higher purchased power costs, the company managed to improve its operating income and net income, indicating effective cost management and revenue growth strategies.

Key Financial Figures

• $12.50 — mmonwealth Edison Company Common Stock, $12.50 par value 127,021,419 PECO Energy Comp
• $0.01 — ac Electric Power Company Common Stock, $0.01 par value 100 Delmarva Power & Light C
• $2.25 — rva Power & Light Company Common Stock, $2.25 par value 1,000 Atlantic City Electric
• $3.00 — tic City Electric Company Common Stock, $3.00 par value 8,546,017 TABLE OF CONTENTS

Filing Documents

• exc-20250930.htm (10-Q) — 9182KB
• exc-ex3101_20250930q31.htm (EX-31.01) — 9KB
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• 0001109357-25-000182.txt ( ) — 37437KB
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FINANCIAL STATEMENTS

FINANCIAL STATEMENTS 9 Exelon Corporation Consolidated Statements of Operations and Comprehensive Income 10 Consolidated Statements of Cash Flows 11 Consolidated Balance Sheets 12 Consolidated Statements of Changes in Shareholders' Equity 14 Commonwealth Edison Company Consolidated Statements of Operations and Comprehensive Income 16 Consolidated Statements of Cash Flows 17 Consolidated Balance Sheets 18 Consolidated Statements of Changes in Shareholders' Equity 20 PECO Energy Company Consolidated Statements of Operations and Comprehensive Income 21 Consolidated Statements of Cash Flows 22 Consolidated Balance Sheets 23 Consolidated Statements of Changes in Shareholder's Equity 25 Baltimore Gas and Electric Company 26 27 Balance Sheets 28 30 Pepco Holdings LLC Consolidated Statements of Operations and Comprehensive Income 31 Consolidated Statements of Cash Flows 32 Consolidated Balance Sheets 33 Consolidated Statements of Changes in Member's Equity 35 1 Page No. Potomac Electric Power Company 36 37 Balance Sheets 38 40 Delmarva Power & Light Company 41 42 Balance Sheets 43 45 Atlantic City Electric Company Consolidated Statements of Operations and Comprehensive Income 46 Consolidated Statements of Cash Flows 47 Consolidated Balance Sheets 48 Consolidated Statements of Changes in Shareholder's Equity 50 Combined Notes to Consolidated Financial Statements 1. Significant Accounting Policies 51 2. Regulatory Matters 52 3. Revenue from Contracts with Customers 60 4. Segment Information 6

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 109 Exelon Corporation 109 Executive Overview 109 Financial Results of Operations 109 Significant 2025 Transactions and Developments 111 Other Key Business Drivers and Management Strategies 114 Critical Accounting Policies and Estimates 115 Results of Operations By Registrant 116 Commonwealth Edison Company 116 PECO Energy Company 119 Baltimore Gas and Electric Company 123 Pepco Holdings LLC 126 Potomac Electric Power Company 127 Delmarva Power & Light Company 130 Atlantic City Electric Company 135 Liquidity and Capital Resources 138 ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 147 ITEM 4.

CONTROLS AND PROCEDURES

CONTROLS AND PROCEDURES 148 PART II. OTHER INFORMATION 148 ITEM 1.

LEGAL PROCEEDINGS

LEGAL PROCEEDINGS 148 ITEM 1A.

RISK FACTORS

RISK FACTORS 148 ITEM 5. OTHER INFORMATION 148 ITEM 6. EXHIBITS 149

SIGNATURES

SIGNATURES 152 Exelon Corporation 152 Commonwealth Edison Company 153 PECO Energy Company 154 Baltimore Gas and Electric Company 155 Pepco Holdings LLC 156 Potomac Electric Power Company 157 Delmarva Power & Light Company 158 Atlantic City Electric Company 159 3 Table of Contents GLOSSARY OF TERMS AND ABBREVIATIONS Exelon Corporation and Related Entities Exelon Exelon Corporation ComEd Commonwealth Edison Company PECO PECO Energy Company BGE Baltimore Gas and Electric Company Pepco Holdings or PHI Pepco Holdings LLC Pepco Potomac Electric Power Company DPL Delmarva Power & Light Company ACE Atlantic City Electric Company Registrants Exelon, ComEd, PECO, BGE, PHI, Pepco, DPL, and ACE, collectively Utility Registrants ComEd, PECO, BGE, Pepco, DPL, and ACE, collectively BSC Exelon Business Services Company, LLC Exelon Corporate Exelon in its corporate capacity as a holding company PCI Potomac Capital Investment Corporation and its subsidiaries PECO Trust III PECO Energy Capital Trust III PECO Trust IV PECO Energy Capital Trust IV PHI Corporate PHI in its corporate capacity as a holding company PHISCO PHI Service Company Former Related Entities Constellation Constellation Energy Corporation Generation Constellation Energy Generation, LLC (formerly Exelon Generation Company, LLC, a subsidiary of Exelon prior to separation on February 1, 2022) 4 Table of Contents GLOSSARY OF TERMS AND ABBREVIATIONS Other Terms and Abbreviations Note - of the 2024 Form 10-K Reference to specific Combined Note to Consolidated Financial Statements within Exelon's 2024 Annual Report on Form 10-K ABO Accumulated Benefit Obligation AFUDC Allowance for Funds Used During Construction AMI Advanced Metering Infrastructure AOCI Accumulated Other Comprehensive Income (Loss) ARO Asset Retirement Obligation ATM At the market BGS Basic Generation Service BSA Bill Stabilization Adjustment CEJA Climate and Equitable Jobs Act; Illinoi

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS 9 Table of Contents Exelon Corporation and Subsidiary Companies Consolidated Statements of Operations and Comprehensive Income (Unaudited) Three Months Ended September 30, Nine Months Ended September 30, (In millions, except per share data) 2025 2024 2025 2024 Operating revenues Electric operating revenues $ 6,690 $ 6,012 $ 17,872 $ 16,379 Natural gas operating revenues 235 196 1,595 1,207 Revenues from alternative revenue programs ( 220 ) ( 54 ) ( 621 ) ( 29 ) Total operating revenues 6,705 6,154 18,846 17,557 Operating expenses Purchased power 2,645 2,349 6,640 6,483 Purchased fuel 47 34 471 301 Operating and maintenance 1,172 1,275 3,840 3,756 Depreciation and amortization 912 908 2,717 2,681 Taxes other than income taxes 429 395 1,216 1,127 Total operating expenses 5,205 4,961 14,884 14,348 Gain on sale of assets — 3 1 12 Operating income 1,500 1,196 3,963 3,221 Other income and (deductions) Interest expense, net ( 531 ) ( 490 ) ( 1,560 ) ( 1,428 ) Interest expense to affiliates, net ( 7 ) ( 6 ) ( 18 ) ( 18 ) Other, net 68 57 185 196 Total other income and (deductions) ( 470 ) ( 439 ) ( 1,393 ) ( 1,250 ) Income before income taxes 1,030 757 2,570 1,971 Income taxes 155 50 396 158 Net income attributable to common shareholders $ 875 $ 707 $ 2,174 $ 1,813 Comprehensive income, net of income taxes Net income $ 875 $ 707 $ 2,174 $ 1,813 Other comprehensive income (loss), net of income taxes Pension and non-pension postretirement benefit plans: Actuarial losses reclassified to periodic benefit cost 5 5 16 15 Pension and non-pension postretirement benefit plans valuation adjustments — — 5 ( 26 ) Unrealized (loss) gain on cash flow hedges ( 2 ) ( 29 ) ( 16 ) 1 Other comprehensive income (loss) 3 ( 24 ) 5 ( 10 ) Comprehensive income attributable to common shareholders $ 878 $ 683 $ 2,179 $ 1,803 Average shares of common stock outstanding: Basic 1,011 1,003 1,010 1,002 Assumed exercise and

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