stockrowWhat it does
FirstEnergy Corporation is a regulated electric utility that delivers electricity to homes and businesses and operates transmission lines that carry power across the Midwest and Mid-Atlantic. It also generates electricity, principally for customers in West Virginia. Founded in 1997 and headquartered in Akron, the company is led by Chairman, President and Chief Executive Officer Brian X. Tierney.
The business has three segments. Distribution delivers power through local utility networks in Ohio and Pennsylvania. Integrated combines distribution and transmission operations in New Jersey, West Virginia and Maryland with regulated generation in West Virginia. Stand-Alone Transmission owns high-voltage facilities that move electricity across the regional grid.
FirstEnergy’s operating companies serve over six million distribution customers. Its transmission operations include more than 24,000 miles of lines and two regional transmission operation centers. Mon Power and its subsidiary Allegheny Generating Company control 3,610 MWs of generation capacity.
Customers generally pay regulated rates for delivery service. In several states, FirstEnergy’s utilities also arrange electricity supply for customers who have not chosen another supplier. The company’s transmission businesses earn revenue under rates that reflect their investment in the network and associated costs.
How it makes money
FirstEnergy earns revenue by delivering electricity through local distribution networks, carrying it over transmission lines and, in parts of its service area, supplying or generating power. Regulators establish binding, cost-based rates for its regulated utilities. Those rates determine what the companies can charge and collect from customers.
In FY2025, distribution services and retail generation revenue was $12.2 billion, while transmission revenue was $2.3 billion. FirstEnergy reported GAAP earnings of $0.96 per share for the third quarter of 2026. A total revenue figure for that quarter is not provided here.
The Distribution segment serves Ohio and Pennsylvania. It buys power to meet default or standard service obligations for customers who do not select another supplier. Its results reflect the costs of securing and delivering that generation, including the deferral and amortization of certain costs.
The Integrated segment distributes electricity in New Jersey, West Virginia and Maryland, operates transmission infrastructure and includes Mon Power’s regulated generation. Its results also reflect the costs of securing and delivering electricity. The Stand-Alone Transmission segment owns infrastructure used to transport power through the regional grid.
Stand-Alone Transmission revenue is primarily based on forward-looking formula rates. Its revenue requirement is updated annually using projected costs and rate base—the regulated investment used in setting rates—and later adjusted to actual costs and rate base. FirstEnergy records some costs as regulatory assets or liabilities when regulators have authorized their future recovery or return to customers, or when that authorization is probable.
Demand for electricity generally peaks in summer and winter. Mild weather can reduce power sales and, consequently, revenue and cash flow.
| Product or service | Revenue, FY2025 | Share | Change on the year |
|---|---|---|---|
| Distribution services and retail generation | $12.2 billion | 80.8% | 11.1% |
| Transmission | $2.3 billion | 15.3% | 7.59% |
| Other | $590.0 million | 3.91% | 69.5% |
Customers and how it sells
FirstEnergy’s electric companies provide distribution service to over six million customers across Ohio, Pennsylvania, West Virginia, Maryland, New Jersey and New York. Their combined service areas cover approximately 65,000 square miles and had a population of approximately 14 million as of December 31, 2025.
The Distribution segment serves approximately 4.3 million customers in Ohio and Pennsylvania. The Integrated segment distributes electricity to approximately 2 million customers in New Jersey, West Virginia and Maryland. Its transmission infrastructure also extends into Virginia. Customers receive delivery service through their local FirstEnergy operating company; in several jurisdictions they can choose their electricity supplier or remain on a regulated default service.
Demand includes residential, commercial and industrial use. FirstEnergy has also contracted with data center customers: it reported 7.9 GW of contracted data center demand across its footprint in the third quarter of 2026 and was negotiating for approximately 4 GW of additional load. Contracted demand is a measure of electricity capacity, not a count of customers or a revenue share.
FirstEnergy’s transmission facilities operate within the PJM region. The network connects the Midwest and Mid-Atlantic and carries electricity beyond individual local distribution territories.
| Segment | Revenue, FY2025 | Share | Change on the year |
|---|---|---|---|
| Distribution | $7.5 billion | 33.1% | 10.1% |
| Integrated | $5.7 billion | 25.2% | 16.6% |
| Integrated Segment | $5.6 billion | 24.9% | 16.6% |
| Integrated | $1.9 billion | 25.2% | 16.6% |
| Stand-Alone Transmission | $1.9 billion | 8.36% | 6.67% |
Suppliers and costs
FirstEnergy purchases electricity for default-service customers in several jurisdictions through competitive procurement processes approved by state regulators. If a supplier fails to deliver, the local utility may need to buy the required power in the market. West Virginia generation remains regulated by the state.
Mon Power buys coal under contracts with varying expiration dates and can obtain additional supplies through contract options or the spot market. Its contracted coal is produced primarily from mines in Pennsylvania and West Virginia. It also purchases materials used to meet emissions requirements and buys additional emissions allowances when needed. For its proposed Maidsville generating facility, FirstEnergy has reserved turbines from Siemens for delivery in 2030.
The business requires substantial spending on operations, construction and other investments, as well as debt maturities and interest. FirstEnergy also faces employee, pension and storm-restoration costs. Supply lead times have not fully returned to pre-pandemic levels; the company says it is addressing constraints and does not expect corresponding service disruptions or a material impact on its capital plan.
- Revenue$15.1B
- Cost of revenue−$5.2B
- Selling, general and administrative−$1.3B
- Other operating costs−$6.3B
- Operating income$2.2B
Competitive position
There is generally no competition for electric distribution service within the respective territories of FirstEnergy’s electric companies. Customers in several states can choose an electricity supplier, while the local FirstEnergy utility remains responsible for distribution service and, where applicable, default supply for customers who do not shop.
Transmission development is different. Subject to siting and permitting approvals, developers that do not already operate in a territory can compete for certain PJM transmission projects. That process creates competition to build facilities in FirstEnergy’s service territories and gives FirstEnergy opportunities to seek projects elsewhere. No specific competing developers are named in the available business descriptions.
Our reading: The absence of general distribution competition is a strong protection for the local delivery business, although regulated rates govern what the utilities can charge. Our reading: FirstEnergy’s existing transmission network and operating presence provide a basis for pursuing projects, but the competitive PJM process limits how much protection that position provides.
FirstEnergy also participates in joint ventures for transmission projects. Its transmission subsidiary FET has worked with other developers on projects awarded by PJM, and the company reported more than $5 billion in awarded competitive transmission investments since 2022, including joint ventures. Such awards do not remove the need for approvals, financing and construction.
Growth opportunities
FirstEnergy’s investment plan is centered on upgrading distribution and transmission networks, improving reliability and serving growing electricity demand. Its Energize365 plan calls for $36 billion of system-wide investment from 2026 to 2030. The plan includes investments in grid automation, communications and advanced metering, as well as transmission and distribution work.
The company expects at least a 25% increase in its current $19 billion transmission investment plan when it releases an updated five-year plan. FirstEnergy says rising demand and regional reliability needs are driving transmission investment. It has submitted proposed solutions through PJM’s competitive process and expects project awards in the first quarter of 2027.
Data centers are another source of potential demand. FirstEnergy reported 7.9 GW of contracted data center demand across its footprint and said West Virginia pipeline demand had risen to nearly 6 GW. The company has proposed the Maidsville generating facility to support demand and expected a West Virginia regulatory order in the fourth quarter of 2026. It has reserved turbines for delivery in 2030 and is working to finalize gas supply and construction arrangements.
FirstEnergy has also sought proposals for an initial 3 GW of additional combined-cycle turbines and expects an update in early 2027. These generation opportunities and the expanded transmission plan would require additional financing; the company says it plans to use equity or equity-like securities as part of that funding.
- $11.1BFY2021
- $12.5BFY2022
- $12.9BFY2023
- $13.5BFY2024
- $15.1BFY2025
Structural risks
- Regulatory recovery: State or federal regulators can delay or deny recovery of costs. Customer affordability concerns and changes in transmission-rate policy could constrain rate increases or investment returns.
- Financing and execution: The business is capital intensive and expects to use external funding. Financing depends on market conditions, while transmission growth also depends on approvals and timely construction.
- Demand and supply: Data center load could strain available electricity and infrastructure. Demand may also be lower than projected if proposed facilities do not begin operating or use less power than expected.
- Weather and operations: Mild weather can reduce power sales. Severe weather can cause outages and property damage, with restoration costs that may not be recoverable from customers.
- Legal and reputation: FirstEnergy considers a loss probable in securities class-action litigation related to the HB 6 investigation but cannot reasonably estimate the loss or range of loss. It also has continuing obligations under its deferred prosecution agreement.
- Supply chain and security: Tariffs, inflation and extended lead times could disrupt supplies. Cyberattacks or breaches affecting FirstEnergy or its third parties could compromise operations and sensitive data.
Bottom line
Our reading
Our reading: FirstEnergy is primarily a regulated electricity-delivery business, with established local service territories and a transmission network that can support further investment. Its opportunity to expand depends on demand materializing and regulators allowing recovery of project costs; its exposure includes financing needs, weather and unresolved litigation. The proposed generation and increased transmission plans add to those execution and regulatory demands. (item1, item1a, call_prepared)