Core Insights - Nuclear energy stocks are experiencing significant growth, with Talen Energy (NASDAQ: TLN) being highlighted as a notable performer, having increased by 33% since the last analysis [1]. Company Overview - Talen Energy generates approximately 21% of its energy from nuclear sources, positioning itself favorably within the high-performing nuclear energy segment [1]. Market Context - The focus on nuclear energy is part of a broader trend in the energy sector, with the potential for market-beating portfolios and thematic investment opportunities being emphasized [1].

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Industry Overview - The artificial intelligence (AI)-powered data center industry is experiencing significant growth, leading to increased demand for nuclear energy as a power source [1] - The U.S. Department of Energy predicts that data center energy usage will "double or triple by 2028," following a doubling over the past decade [2] - Recent executive orders aim to increase U.S. nuclear energy capacity from 100 gigawatts (GW) to 400 GW by 2050, focusing on reactors near military installations and AI data centers [3] Company Insights: Constellation Energy Corp. (CEG) - Constellation Energy is a leading U.S. energy company with a strong focus on clean and nuclear energy, planning a $5.1 billion capital expenditure through 2025 to enhance nuclear fuel acquisition [6] - The company has secured a 20-year agreement with Microsoft to revive the Three Mile Island nuclear plant, involving a $1.6 billion investment to provide carbon-free electricity for data centers [8] - CEG has also signed a 20-year energy deal with Meta Platforms to supply 1.1 gigawatts of nuclear power for its AI data centers starting in 2027 [9] - Expected revenue and earnings growth rates for CEG are 0.9% and 9%, respectively, with a recent 0.7% improvement in the earnings consensus estimate [10] Company Insights: Talen Energy Corp. (TLN) - Talen Energy is an independent power producer operating various energy sources, including nuclear, and is developing battery storage projects [12] - TLN has expanded its nuclear energy partnership with Amazon, committing to supply 1,920 megawatts of carbon-free nuclear power through 2042 [13][14] - The expected revenue and earnings growth rates for TLN are 25.1% and over 100%, respectively, with a 2.9% improvement in the earnings consensus estimate for the next year [14]

Group 1 - Rob Howard is Co-Manager at Boiling Point Resources with extensive experience in the utility industry, having worked at Baltimore Gas and Electric for over seven years [1] - His background includes roles in Distribution Engineering, Demand Side Management, and Rates and Regulation, providing him with a deep understanding of industry issues [1] - After his industry experience, he transitioned to the investments business and has been following utilities since 2002 [1] Group 2 - Rob Howard holds a BS in Engineering and a BA in Economics from Swarthmore College, as well as an MBA in Finance from The University of Texas [1] - He is a CFA charterholder, indicating a high level of expertise in financial analysis and investment management [1]

Executing Our Strategy Validating The Thesis On Power & Data Intersection Talen Energy Corporation | June 11, 2025 Disclaimers The information contained herein, as well as any information that has been supplied orally in connection herewith, speaks only as of the date of this presentation. Talen Energy Corporation ("Talen," "TEC," the "Company," "we," "our," or "us") and our affiliates and representatives expressly disclaim any obligation to update any information contained herein, whether as a result of ne ...

Talend Energy Business Update Conference Call Summary Company Overview - **Company**: Talend Energy - **Industry**: Independent Power Producer (IPP) Key Points and Arguments New Contract with Amazon - Talend announced a revamped and expanded contract with Amazon, which simplifies their relationship and doubles the contract size, leading to significant free cash flow growth per share beyond previous projections [4][5][6] - The new agreement transitions to a front of the meter contract, allowing Talend to become the retail provider for Amazon using nuclear power for its data centers in Pennsylvania, eliminating the need for FERC approval [6][9] - The contract has a notional value of $18 billion over 17 years, providing a roadmap for generating incremental value and enhancing capital allocation flexibility [10][20] Financial Implications - At full ramp, the Amazon transaction is expected to increase after-tax cash flow per share by over 50% above 2026 guidance, adding more than $8 per share by 2032 [18][19] - The contract is projected to generate approximately $1.4 billion annually at full ramp, contributing to long-term contracted cash flows [19][20] - Talend anticipates a 20% annual growth in cash flow per share off the 2024 baseline, with 50% of margins under contract with Amazon [19][20] Economic and Community Impact - The collaboration with Amazon is expected to create high-paying jobs and stimulate economic development in Pennsylvania, benefiting local communities and infrastructure [8][16] - The agreement is supported by various stakeholders, including local government and labor leadership, indicating broad community support [8] Strategic Vision - Talend aims to be a leading energy supplier for data centers in the PJM region, leveraging its core IPP skills and risk management capabilities [9][22] - The company is focused on executing its strategy of powering the future, with plans to explore additional development opportunities, including small modular reactors (SMRs) [14][56] Market Position and Future Outlook - The new contract is seen as a differentiator in the IPP space, reducing risk and increasing returns, which may lead to a lower cost of capital and higher valuation multiples [24][70] - Talend is committed to maintaining a disciplined approach to M&A and capital allocation, ensuring that any future acquisitions align with their strategic goals [82][103] Regulatory and Operational Considerations - The shift from behind the meter to front of the meter solutions is intended to provide clarity and reduce operational risks, while still allowing for flexibility in energy supply [44][45] - Talend is working on regulatory and commercial solutions to support its growth strategy and meet the increasing demand for energy from data centers [6][9] Additional Important Content - The call included discussions on the implications of the new contract for Talend's ability to acquire additional assets in the PPL zone and the potential for reduced basis differentials in the market [71][72] - The management emphasized the importance of contracted cash flows in improving the credit profile and recovery for collateral under the business [80][81] - Talend's approach to shareholder returns remains focused on targeting 70% of free cash flow for distribution, with an expected improvement in EBITDA to free cash flow conversion [106][107] This summary encapsulates the key points discussed during the Talend Energy Business Update Conference Call, highlighting the strategic direction, financial implications, and community impact of the new contract with Amazon.

Industry Transformation - The utility energy industry is experiencing a significant transformation due to global decarbonization efforts, technological advancements, and changing regulatory environments [1] - There is a notable increase in investments in renewable energy, driven by rising demand influenced by AI-driven data [1]

Financial Data and Key Metrics Changes - The company reported adjusted EBITDA of $200 million and adjusted free cash flow of $87 million for Q1 2025, exceeding internal estimates and underpinning 2025 guidance [10][21][24] - The adjusted EBITDA range for 2025 has been narrowed to $975 million to $1,125 million, while the adjusted free cash flow range is now $450 million to $540 million [22][23] Business Line Data and Key Metrics Changes - The fossil fleet generated approximately 20% more power than the same period last year, despite the absence of ERCOT assets [21] - The Susquehanna nuclear facility contributed slightly less than half of the total power generation of 9.7 terawatt hours during the quarter [20] Market Data and Key Metrics Changes - In Q1, there was an increase of 7 terawatt hours or approximately 3.5% in incremental deliveries in PJM compared to the prior year, leading to a dispatch increase of 1.6 terawatt hours [15] - The company noted that the weather in PJM was colder than average, contributing to increased demand and higher settled on-peak power prices compared to the previous year [21] Company Strategy and Development Direction - The company remains focused on executing its business plan, emphasizing operations, commercialization of megawatts, and returning capital to shareholders [6][10] - The strategic partnership with AWS is a key component of the growth strategy, with plans to expand beyond the current 300 megawatt ISA [12][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term prospects for the IPP business, citing tightening power markets and increasing data center loads [7][8] - The company is optimistic about the future, despite market uncertainties related to tariffs and trade restrictions, and believes that the intersection of power and data centers will be validated in 2025 [10][18] Other Important Information - The company repurchased $83 million worth of shares during Q1 2025, continuing its share repurchase program [11][24] - The company has approximately $1 billion in buyback capacity remaining through the end of 2026 and maintains a net leverage ratio of approximately 2.6 times [24][25] Q&A Session Summary Question: Shift in customer interest toward front of the meter deals - Management acknowledged ongoing discussions about various ways to power data centers and expand growth strategy, emphasizing the importance of speed to market [32][34] Question: Current status of the FERC process and co-location - Management indicated that the FERC process is evolving, with a focus on resolving issues quickly to support economic development in Pennsylvania [39][40] Question: Updates on PPL zone capacity and potential expansion - Management reiterated their growth strategy focused on leveraging existing assets and emphasized the importance of reliability in their contracts [46][47] Question: Details on the Susquehanna outage - Management confirmed a target for the outage to be completed by mid-May, with confidence in the incremental maintenance work being performed [66][68] Question: Capital allocation and buyback pace - Management stated that they will continue to execute their share repurchase program when market opportunities arise, with a focus on returning capital to shareholders [82][86] Question: Insights on PJM auction and new builds - Management expressed optimism about the upcoming capacity auction and discussed the challenges of new builds due to current market conditions [91][93]

Financial Data and Key Metrics Changes - The company reported adjusted EBITDA of $200 million and adjusted free cash flow of $87 million for Q1 2025, exceeding internal estimates [8][20] - The adjusted EBITDA guidance for 2025 has been narrowed to a range of $975 million to $1,125 million, while the adjusted free cash flow guidance is now between $450 million and $540 million [21][22] - The company experienced a 20% increase in power generation from its fossil fleet compared to the same period last year [21] Business Line Data and Key Metrics Changes - The fossil fleet generated approximately 9.7 terawatt hours of power, with a forced outage factor of 1.2% [18][19] - The Susquehanna nuclear facility contributed slightly less than half of the total generation, while the Montour and Bruner Island facilities saw significant increases in generation [19] Market Data and Key Metrics Changes - The company observed a 3.5% increase in incremental deliveries in the PJM market compared to the previous year, leading to a dispatch increase of approximately 1.6 terawatt hours [14] - The market is experiencing tightening conditions driven by increased demand, particularly from data centers [15][16] Company Strategy and Development Direction - The company remains focused on executing its business plan, emphasizing operations, commercialization of megawatts, and returning capital to shareholders [5][6] - The company is committed to expanding its strategy to contract megawatts at other sites, aiming to deliver the most free cash flow per megawatt [5] - The company is actively exploring various commercial solutions to power data centers, including both front-of-the-meter and behind-the-meter arrangements [32][35] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term prospects for the Independent Power Producer (IPP) business, citing strong data center load growth and a favorable market environment [6][15] - The company is optimistic about the future, with expectations of increased energy sales and operational efficiency following maintenance work at the Susquehanna facility [13][66] - Management acknowledged uncertainties related to tariffs and trade restrictions but indicated that these do not have a material effect on near-term costs [21][22] Other Important Information - The company repurchased $83 million worth of shares during Q1 2025, continuing its share repurchase program [9][23] - The company has approximately $1 billion in buyback capacity remaining through the end of 2026 [23] Q&A Session Summary Question: Shift in customer interest toward front-of-the-meter deals - Management confirmed ongoing discussions regarding various ways to power data centers, including front-of-the-meter solutions, while executing the current contract with AWS [32][35] Question: Current status of the FERC process and potential settlement - Management indicated that the FERC process is evolving, with a focus on resolving issues quickly to support economic development related to data centers [39][40] Question: Updates on the litigation process at the Fifth Circuit around the ISA - The company is monitoring the Fifth Circuit proceedings, with a briefing schedule expected soon, focusing on technical issues related to the FERC decision [118][120]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________ to __________ Commission File Number: 001-37388 Talen Energy Corporation (Exact name of registrant as specified in its charter) (State or other jur ...