NRG dives on Q2 miss, data center deal where investors were “looking for more”
Power producer and energy trader NRG dove Wednesday after adjusted earnings fell short of Wall Street expectations and GAAP results swung to a surprise loss, linked to fluctuating values of derivatives contracts the company uses to hedge.
NRG is a cornerstone of the AI power trade, a widely placed bet that power producers will prosper from surging demand for juice from the data centers built to power AI.
This consensus has turned a normally sleepy sector of the stock market — utilities — into an outperformer this year. The S&P 500 utilities sector is up more than 13% in 2025, compared to the roughly 8% gain for the broader index.
In addition to the earnings miss, investors also seemed unimpressed with a data center deal that NRG announced in conjunction with earnings, long-term agreements to provide 295 megawatts of power for data centers. Analysts covering the stock at Jefferies wrote of the day’s disappointment:
“Expectations were simply higher and the name is more crowded than we appreciated. We have had over fifteen investor inbounds on NRG this morning, an exceptionally high amount, including many from non-sector specialists, highlighting how crowded of a long the stock has become. Investors were seemingly looking for more than the ~300MW data center contracts.”
This consensus has turned a normally sleepy sector of the stock market — utilities — into an outperformer this year. The S&P 500 utilities sector is up more than 13% in 2025, compared to the roughly 8% gain for the broader index.
In addition to the earnings miss, investors also seemed unimpressed with a data center deal that NRG announced in conjunction with earnings, long-term agreements to provide 295 megawatts of power for data centers. Analysts covering the stock at Jefferies wrote of the day’s disappointment:
“Expectations were simply higher and the name is more crowded than we appreciated. We have had over fifteen investor inbounds on NRG this morning, an exceptionally high amount, including many from non-sector specialists, highlighting how crowded of a long the stock has become. Investors were seemingly looking for more than the ~300MW data center contracts.”
