ALABAMA POWER CO

Mississippi Power's net income was $215 million in 2025, representing a $16 million, or 8.0%, increase from 2024. The increase was primarily due to higher retail revenues primarily resulting from changes in rates and pricing, partially offset by increases in depreciation and amortization and other operations and maintenance expenses.

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A condensed income statement for Mississippi Power follows:

Retail revenues for 2025 increased $120 million, or 12.4%, as compared to 2024. Details of the changes in retail revenues were as follows:

Changes in rates and pricing resulted in an increase in revenues primarily due tonew PEP rates that became effective for the first billing cycle of April 2025. See Note 2 to the financial statements under "Mississippi Power – Performance Evaluation Plan" for additional information.

Changes in sales resulted in an increase in retail revenues in 2025 as compared to 2024. Changes in retail revenues are influenced heavily by the change in the volume of energy sold from year to year, which generally results from changes in electricity usage by

II-25 customers, weather, and the number of customers. Total retail KWH sales for 2025 and the percent change from 2024 were as follows:

(*)Weather-adjusted KWH sales are estimated using statistical models of the historical relationship between temperatures and energy sales, and then removing the estimated effect of deviations from normal temperature conditions. Normal temperature conditions are defined as those experienced in Mississippi Power's service territory over a specified historical period. This metric is useful because it allows trends in historical operations to be evaluated apart from the influence of weather conditions. Management also considers this metric in developing long-term capital and financial plans.

Weather-adjusted retail energy sales increased by 86 million KWHs in 2025 as compared to 2024. Weather-adjusted residential KWH sales increased 2.1% primarily due to increased customer usage. Weather-adjusted commercial KWH sales decreased 0.5% primarily due to decreased customer usage. Industrial KWH sales increased 1.3% primarily due to increases in the petroleum and chemicals sectors.

Changes in fuel and other cost recovery revenues resulted in an increase in retail revenues in 2025 as compared to 2024 primarily due to higher recoverable fuel costs, as discussed further under "Fuel and Purchased Power Expenses" herein. Recoverable fuel costs include fuel and purchased power expenses reduced by the fuel and emissions portion of wholesale revenues from energy sold to customers outside Mississippi Power's service territory. Electric rates for Mississippi Power include provisions to adjust billings for fluctuations in fuel costs, including the energy component of purchased power costs. Under these provisions, fuel revenues generally equal fuel expenses, including the energy component of purchased power costs, and do not affect net income. Recoverable fuel costs include fuel and purchased power expenses reduced by the fuel and emissions portion of wholesale revenues from energy sold to customers outside Mississippi Power's service territory. See Note 2 to the financial statements under "Mississippi Power – Fuel Cost Recovery" for additional information.

Wholesale revenues from sales to non-affiliates increased $47 million, or 20.6%, in 2025 ascompared to 2024. Details of wholesale revenues from power sales to non-affiliated utilities, including FERC-regulated MRA sales as well as market-based sales, were as follows:

Theincrease in wholesale revenues from sales to non-affiliateswas due toa $25 million increase associated with MRA customers largely due to higher recoverable fuel costs, a $15 million increase associated with changes in power supply agreements, and a $7 million increase in opportunity sales. Wholesale energy sales to non-affiliates totaled 3,397 million KWHs in 2025, an 8.5% increase as compared to 2024.

Wholesale revenues from sales to non-affiliates will vary depending on fuel prices, the market prices of wholesale energy compared to the cost of Mississippi Power's and 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. Increases and decreases in energy revenues that are driven by fuel prices are accompanied by an increase or decrease in fuel costs and do not have a significant impact on net income. In addition, Mississippi Power provides service under long-term contracts with rural electric cooperative associations and a municipality located in southeastern Mississippi which are subject to regulation by the FERC. The contracts with these wholesale customers represented 12.9% of Mississippi Power's total operating revenues in 2025. Short-term opportunity energy sales are also included in sales for resale to non-affiliates. These opportunity sales are made at

II-26 market-based rates that generally provide a margin above Mississippi Power's variable cost to produce the energy. See Note 2 under "Mississippi Power –Municipal and Rural Associations Tariff" for additional information.

Wholesale revenues from sales to affiliates increased $62 million, or 28.4%, in 2025 as compared to 2024. The increase was primarily due to increases of $44 million related to the price of energy driven by natural gas prices and $16 million related to the volume of KWH sales. Wholesale energy sales to affiliates totaled 5,636 million KWHs in 2025, a 10.4% increase as compared to 2024. See Note 2 to the financial statements under "Mississippi Power – Integrated Resource Plans" for additional information.

Wholesale revenues from sales to affiliates 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 or other contractual agreements, as approved by the FERC. The energy portion of these transactions does not have a significant impact on earnings since this energy is generally sold at marginal cost.

In 2025, other operating revenues increased $3 million, or 5.8%, as compared to 2024 primarily due to an increase of $8 million in customer charges related to contributions in aid of construction included in rates, partially offset by a decrease of $4 million in transmission revenue primarily associated with open access transmission tariff revenues.

Fuel and purchased power expenses were $624 million in 2025, an increase of $147 million, or 30.8%, as compared to 2024. The increase was primarily due to a $111 million increase related to the average cost of fuel and a $36 million increase related to the volume of KWHs generated and purchased.

Fuel and purchased power energy transactions do not have a significant impact on earnings since energy expenses are generally offset by energy revenues through Mississippi Power's fuel cost recovery clauses. See Note 2 to the financial statements under "Mississippi Power – Fuel Cost Recovery" for additional information.

The mix of fuel sources for the generation of electricity is determined primarily by demand, the unit cost of fuel consumed, and the availability of generating units. Additionally, Mississippi Power purchases a portion of its electricity needs from the wholesale market. Energy purchases 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. These purchases are made in accordance with the IIC or other contractual agreements, as approved by the FERC.

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

Other operations and maintenance expenses increased $17 million, or 4.6%, in 2025 as compared to 2024. The increase was primarily due to increases of $20 million in generation expenses primarily associated with planned outages, $7 million in transmission and distribution expenses primarily associated with routine maintenance, and $3 million in customer service expenses, partially offset by a decrease of $10.9 million due to utilization of the retail reliability reserve to offset generation, transmission, and distribution expenses and a decrease of $8 million due to lower retail reliability reserve accruals. See Note 2 to the financial statements under "Mississippi Power –Reliability Reserve Accounting Order" for additional information.

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Depreciation and amortization increased $18 million, or 9.3%, in 2025 as compared to 2024 primarily due to increases of $10 million resulting from higher depreciation rates and $9 million associated with additional plant in service. See Note 5 to the financial statements under "Depreciation and Amortization" for additional information.

Taxes other than income taxes increased $12 million, or 9.4%, in 2025 as compared to 2024. The increase was primarily due to an increase in property taxes primarily resulting from an increase in the assessed value of property.

Income taxes increased $18 million, or 38.3%, in 2025 as compared to 2024 primarily due to a decrease of $10 million in the flowback of certain excess deferred income taxes and higher pre-tax earnings. See Note 10 to the financial statements for additional information.