AEP Texas Inc.

For the period ended Dec 31, 2025. Filed Feb 12, 2026.

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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.

FY2025 · Filed Feb 12, 2026

AEP$128.33+1.4%Stored close · as of Nov 9, 2026

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Contents

Item 8. Consolidated Financial Statements

	Years Ended December 31,
	2025	2024	2023
REVENUES
Electric Generation, Transmission and Distribution	$2,281	$2,149	$2,155
Sales to AEP Affiliates	71	71	82
(Provision for)/Reversal of – Revenue Refund – Affiliated	12	(9)	(35)
Provision for Refund	(20)	(182)	(21)
Other Revenues	10	7	2
TOTAL REVENUES	2,354	2,036	2,183
EXPENSES
Purchased Electricity, Fuel and Other Consumables Used for Electric Generation	727	733	807
Other Operation	458	423	361
Maintenance	194	149	159
Asset Impairments and Other Related Charges	6	—	86
Depreciation and Amortization	429	389	343
Taxes Other Than Income Taxes	129	125	135
TOTAL EXPENSES	1,943	1,819	1,891
OPERATING INCOME	411	217	292
Other Income (Expense):
Interest Income	11	14	19
Allowance for Equity Funds Used During Construction	23	14	11
Non-Service Cost Components of Net Periodic Benefit Cost	7	1	14
Interest Expense	(157)	(106)	(147)
INCOME BEFORE INCOME TAX EXPENSE (BENEFIT) AND EQUITY EARNINGS	295	140	189
Income Tax Expense (Benefit)	(95)	(184)	(33)
Equity Earnings of Unconsolidated Subsidiary	1	2	2
NET INCOME	391	326	224
Net Income Attributable to Noncontrolling Interest	3	5	4
EARNINGS ATTRIBUTABLE TO SWEPCo COMMON SHAREHOLDER	$388	$321	$220
The common stock of SWEPCo is wholly-owned by Parent.
See Notes to Financial Statements of Registrants beginning on page 182.

	Years Ended December 31,
	2025	2024	2023
Net Income	$391	$326	$224
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAXES
Amortization of Pension and OPEB Deferred Costs, Net of Tax of $0, $0 and $0 in 2025, 2024 and 2023, Respectively	—	—	(1)
Pension and OPEB Funded Status, Net of Tax of $1, $2 and $1 in 2025, 2024 and 2023, Respectively	5	6	2
TOTAL OTHER COMPREHENSIVE INCOME	5	6	1
TOTAL COMPREHENSIVE INCOME	396	332	225
Total Comprehensive Income Attributable to Noncontrolling Interest	3	5	4
TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO SWEPCo COMMON SHAREHOLDER	$393	$327	$221
See Notes to Financial Statements of Registrants beginning on page 182.

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

	SWEPCo Common Shareholder
Common Stock · Paid-inCapital · RetainedEarnings · AccumulatedOtherComprehensiveIncome (Loss) · NoncontrollingInterest · Total
TOTAL EQUITY – DECEMBER 31, 2022	$—		$1,442		$2,236		$(4)		$1	$3,675
Capital Contribution from Parent		50						50
Common Stock Dividends				(175)				(175)
Common Stock Dividends – Nonaffiliated						(5)		(5)
Net Income				220			4		224
Other Comprehensive Income					1			1
TOTAL EQUITY – DECEMBER 31, 2023	—		1,492		2,281		(3)		—	3,770
Capital Contribution from Parent		59						59
Return of Capital to Parent		(1)						(1)
Common Stock Dividends				(250)				(250)
Common Stock Dividends – Nonaffiliated						(5)		(5)
Net Income				321			5		326
Other Comprehensive Income					6			6
TOTAL EQUITY – DECEMBER 31, 2024	—		1,550		2,352		3		—	3,905
Capital Contribution from Parent		601						601
Common Stock Dividends – Nonaffiliated						(3)		(3)
Net Income				388			3		391
Other Comprehensive Income					5			5
TOTAL EQUITY – DECEMBER 31, 2025	$—		$2,151		$2,740		$8		$—	$4,899
See Notes to Financial Statements of Registrants beginning on page 182.

ASSETS

	December 31,
	2025	2024
CURRENT ASSETS
Cash and Cash Equivalents	$2	$2
Restricted Cash(December 31, 2025 and 2024 Amounts Include $15 and $3, Respectively, Related to Storm Recovery Funding)	15	3
Advances to Affiliates	23	2
Accounts Receivable:
Customers	63	35
Affiliated Companies	91	54
Miscellaneous	10	9
Total Accounts Receivable	164	98
Fuel	83	87
Materials and Supplies(December 31, 2025 and 2024 Amounts Include $1 and $2, Respectively, Related to Sabine)	88	81
Risk Management Assets	35	18
Accrued Tax Benefits	17	26
Regulatory Asset for Under-Recovered Fuel Costs	115	107
Prepayments and Other Current Assets	14	14
TOTAL CURRENT ASSETS	556	438
PROPERTY, PLANT AND EQUIPMENT
Electric:
Generation	6,621	5,288
Transmission	3,302	2,864
Distribution	3,242	3,007
Other Property, Plant and Equipment (December 31, 2025 and 2024 Amounts Include $125 and $167, Respectively, Related to Sabine)	942	940
Construction Work in Progress	712	627
Total Property, Plant and Equipment	14,819	12,726
Accumulated Depreciation and Amortization (December 31, 2025 and 2024 Amounts Include $125 and $167, Respectively, Related to Sabine)	3,478	3,280
TOTAL PROPERTY, PLANT AND EQUIPMENT – NET	11,341	9,446
OTHER NONCURRENT ASSETS
Regulatory Assets	903	921
Securitized Assets(December 31, 2025 and 2024 Amounts Include $315 and $331, Respectively, Related to Storm Recovery Funding)	315	331
Deferred Charges and Other Noncurrent Assets	409	359
TOTAL OTHER NONCURRENT ASSETS	1,627	1,611
TOTAL ASSETS	$13,524	$11,495
See Notes to Financial Statements of Registrants beginning on page 182.

	December 31,
	2025	2024
(in millions)
CURRENT LIABILITIES
Advances from Affiliates	$—	$275
Accounts Payable:
General	392	265
Affiliated Companies	89	57
Short-term Debt – Nonaffiliated	3	6
Long-term Debt Due Within One Year – Nonaffiliated(December 31, 2025 and 2024 Amounts Include $17 and $23, Respectively, Related to Storm Recovery Funding)	917	23
Risk Management Liabilities	9	2
Customer Deposits	79	75
Accrued Taxes	68	49
Accrued Interest	49	41
Obligations Under Operating Leases	7	8
Provision for Refund	81	71
Other Current Liabilities	191	160
TOTAL CURRENT LIABILITIES	1,885	1,032
NONCURRENT LIABILITIES
Long-term Debt – Nonaffiliated(December 31, 2025 and 2024 Amounts Include $304 and $309, Respectively, Related to Storm Recovery Funding)	3,057	3,958
Long-term Debt – Affiliated	1,000	—
Deferred Income Taxes	1,458	1,271
Regulatory Liabilities and Deferred Investment Tax Credits	531	611
Asset Retirement Obligations	252	257
Employee Benefits and Pension Obligations	39	46
Obligations Under Operating Leases	195	138
Provision for Refund	47	108
Storm Reserve	108	106
Deferred Credits and Other Noncurrent Liabilities	53	63
TOTAL NONCURRENT LIABILITIES	6,740	6,558
TOTAL LIABILITIES	8,625	7,590
Rate Matters (Notes 4)
Commitments and Contingencies (Note 6)
EQUITY
Common Stock – Par Value – $18 Per Share:
Authorized – 3,680 Shares
Outstanding – 3,680 Shares	—	—
Paid-in Capital	2,151	1,550
Retained Earnings	2,740	2,352
Accumulated Other Comprehensive Income (Loss)	8	3
TOTAL COMMON SHAREHOLDER’S EQUITY	4,899	3,905
Noncontrolling Interest	—	—
TOTAL EQUITY	4,899	3,905
TOTAL LIABILITIES AND EQUITY	$13,524	$11,495
See Notes to Financial Statements of Registrants beginning on page 182.

	Years Ended December 31,
	2025	2024	2023
OPERATING ACTIVITIES
Net Income	$391	$326	$224
Adjustments to Reconcile Net Income to Net Cash Flows from Operating Activities:
Depreciation and Amortization	429	389	343
Deferred Income Taxes	82	(74)	54
Asset Impairments and Other Related Charges	6	—	86
Allowance for Equity Funds Used During Construction	(23)	(14)	(11)
Mark-to-Market of Risk Management Contracts	(8)	(20)	19
Deferred Fuel Over/Under-Recovery, Net	104	156	184
Provision for Refund – Turk Plant	—	79	—
Change in Other Noncurrent Assets	(36)	(69)	(102)
Change in Other Noncurrent Liabilities	(125)	(41)	11
Changes in Certain Components of Working Capital:
Accounts Receivable, Net	(66)	(3)	20
Fuel, Materials and Supplies	(3)	29	(31)
Accounts Payable	77	3	(8)
Accrued Taxes, Net	28	(8)	(5)
Provision for Refund – Turk Plant	—	68	—
Other Current Assets	7	10	20
Other Current Liabilities	12	(14)	(1)
Net Cash Flows from Operating Activities	875	817	803
INVESTING ACTIVITIES
Construction Expenditures	(935)	(741)	(781)
Change in Advances to Affiliates, Net	(21)	—	—
Acquisition of Renewable Energy Facilities	(1,229)	(399)	—
Other Investing Activities	14	11	4
Net Cash Flows Used for Investing Activities	(2,171)	(1,129)	(777)
FINANCING ACTIVITIES
Capital Contribution from Parent	601	59	50
Return of Capital to Parent	—	(1)	—
Issuance of Long-term Debt – Nonaffiliated	—	336	347
Issuance of Long-term Debt – Affiliated	1,000	—	—
Change in Short-term Debt – Nonaffiliated	(3)	1	4
Change in Advances from Affiliates, Net	(275)	186	(222)
Retirement of Long-term Debt – Nonaffiliated	(11)	—	(94)
Principal Payments for Finance Lease Obligations	(4)	(14)	(19)
Dividends Paid on Common Stock	—	(250)	(175)
Dividends Paid on Common Stock – Nonaffiliated	(3)	(5)	(5)
Other Financing Activities	3	2	2
Net Cash Flows from (Used for) Financing Activities	1,308	314	(112)
Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash	12	2	(86)
Cash, Cash Equivalents and Restricted Cash at Beginning of Period	5	3	89
Cash, Cash Equivalents and Restricted Cash at End of Period	$17	$5	$3
SUPPLEMENTARY INFORMATION
Cash Paid for Interest, Net of Capitalized Amounts	$156	$139	$129
Noncash Acquisitions Under Finance Leases	3	2	7
Construction Expenditures Included in Current Liabilities as of December 31,	225	137	64
See Notes to Financial Statements of Registrants beginning on page 182.

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