SOUTHERN CO

Alabama Power's net income in the first quarter 2025 was $375 million compared to $333 million for the corresponding period in 2024. The increase was primarily due to an increase in retail electric revenues associated with rates and pricing and weather impacts and an increase in other revenues. These increases to net income were partially offset by an increase in non-fuel operations and maintenance expenses, decreased customer usage, and increases in taxes other than income taxes and depreciation and amortization.

In the first quarter 2025, retail revenues were$1.7 billion compared to $1.6 billion for the corresponding period in 2024. Details of the changes in retail revenues were as follows:

Changes in rates and pricing resulted in an increase in revenues in the first quarter 2025 when compared to the corresponding period in 2024 primarily due to an increase in Rate RSE. See Note 2 to the financial statements under "Alabama Power" in Item 8 of the Form 10-K for additional information.

Changes in sales resulted in a decrease in revenues in the first quarter 2025 when compared to the corresponding period in 2024. Weather-adjusted residential KWH sales and weather-adjusted commercial KWH sales decreased 3.1% and 1.5%, respectively, primarily due to decreased customer usage. Industrial KWH sales were flat primarily due to increases in the primary metals sector, offset by decreases in the chemicals sector.

Fuel and other cost recovery revenues increased in the first quarter 2025 when compared to the corresponding period in 2024 primarily as a result of higher recoverable fuel costs.

Electric rates include provisions to recognize the recovery of fuel costs, purchased power costs, PPAs certificated by the Alabama PSC, and costs associated with the NDR. Under these provisions, fuel and other cost recovery revenues generally equal fuel and other cost recovery expenses and do not affect net income. See Note 2 to the financial statements under "Alabama Power" in Item 8 of the Form 10-K for additional information.

Wholesale Revenues– Affiliates

In the first quarter 2025, wholesale revenues from sales to affiliates were $69 million compared to $41 million for the corresponding period in 2024. Theincreasewas primarily due to a 78.7% increase in the price of energy due to an increase in natural gas prices, partially offset by a 5.6% decrease in the volume of KWH sales due to affiliated company energy needs.

Wholesale revenues from sales to affiliated companies will vary depending on demand and the availability and cost of generating resources at each company. These affiliate sales are made in accordance with the IIC, as approved by the FERC. Energy revenues related to these transactions do not have a significant impact on earnings since this energy is generally sold at marginal cost and energy purchases are generally offset by energy revenues through Alabama Power's energy cost recovery clause.

In the first quarter 2025, other revenues were $129 million compared to $100 million for the corresponding period in 2024. The increase was primarily due to a $14 million increase in transmission revenue primarily associated with open access transmission tariff sales and an $11 million increase in regulated energy services revenues.

In the first quarter 2025, total fuel and purchased power expenses were $510 million compared to $425 million for the corresponding period in 2024. The increase was due to a $50 million increase related to the volume of KWHs generated and purchased and a $35 million net increase related to the average cost of fuel and purchased power.

Fuel and purchased power energy transactions do not have a significant impact on earnings since energy expenses are generally offset by energy revenues through Alabama Power's energy cost recovery clause. See Note 2 to the financial statements under "Alabama Power – Rate ECR" in Item 8 of the Form 10-K for additional information.

Energy purchases from non-affiliates will vary depending on the market prices of wholesale energy as compared to the cost of the Southern Company system's generation, demand for energy within the Southern Company system's electric service territory, and the availability of the Southern Company system's generation.

Energy purchases from affiliates will vary depending on demand for energy and the availability and cost of generating resources at each company within the Southern Company system. These purchases are made in accordance with the IIC or other contractual agreements, as approved by the FERC.

Details of Alabama Power's generation and purchased power and the related costs were as follows:

(*)Average cost of purchased power includes fuel, energy, and transmission purchased by Alabama Power for tolling agreements where power is generated by the provider.

In the first quarter 2025, other operations and maintenance expenses were $463 million compared to $412 million for the corresponding period in 2024. The increase was primarily due to increases of $38 million in generation expenses primarily associated with planned outages and $8 million in certain employee compensation and benefit expenses.

In the first quarter 2025, depreciation and amortization was $370 million compared to $361 million for the corresponding period in 2024. The increase was primarily due to additional plant in service related to transmission and distribution systems.

In the first quarter 2025, taxes other than income taxes were $131 million compared to $120 million for the corresponding period in 2024. The increase was primarily due to increases of $5 million in utility license taxes and $4 million in property taxes.

In the first quarter 2025, income taxes were $111 million compared to $85 million for the corresponding period in 2024. The increase was primarily due to higher pre-tax earnings and a $9 million decrease in the flowback of certain excess deferred income taxes. See Note (G) to the Condensed Financial Statements herein for additional information.