Financial Analysis

FINANCING ACTIVITIES The disclosures in this note apply to all Registrants, unless indicated otherwise. Common Stock (Applies to AEP) The following table is a reconciliation of common stock share activity: Shares of AEP Common Stock Issued Held in Treasury Balance, December 31, 2022 525,099,321 11,233,240 Issued 2,269,836 Treasury Stock Reissued (10,048,668) (a) Balance, December 31, 2023 527,369,157 1,184,572 Issued 6,725,373 Treasury Stock Reacquired 2,243 Balance, December 31, 2024 534,094,530 1,186,815 Issued 7,953,758 Balance, December 31, 2025 542,048,288 1,186,815 (a) Reissued Treasury Stock used to fulfill share commitments related to AEPs Equity Units. ATM Program In November 2025, AEP filed a prospectus supplement and executed an Equity Distribution Agreement, pursuant to which AEP may sell, from time to time, up to an aggregate of $3.5 billion of its common stock through an ATM offering program, including an equity forward sales component. The compensation paid to the selling agents by AEP may be up to 2% of the gross offering proceeds of the shares. For the year ended 2025, AEP issued 176,402 shares of common stock and received net cash proceeds of $21 million under the ATM program. As of December 31, 2025, approximately $3.5 billion of equity is available for issuance under the ATM program. Forward Sale of Equity In March 2025, AEP entered into separate forward sale agreements with non-affiliate forward purchasers relating to 22,549,020 shares of AEPs common stoc …

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The tables below represent AEPs reportable segment revenues from contracts with customers, net of respective provisions for refund, by type of revenue: Year Ended December 31, 2025 VIU T&D AEPTHCo G&M Corporate and Other Reconciling Adjustments AEP Consolidated (in millions) Retail Revenues: Residential Revenues $ 4,969 $ 2,785 $ $ $ $ $ 7,754 Commercial Revenues 3,068 1,626 4,694 Industrial Revenues (a) 2,718 533 (1) 3,250 Other Retail Revenues 242 60 302 Total Retail Revenues 10,997 5,004 (1) 16,000 Wholesale and Competitive Retail Revenues: Generation Revenues 1,033 187 1,220 Transmission Revenues (b) 533 812 2,275 (2,017) 1,603 Retail, Trading and Marketing Revenues (c) 2,463 (66) 2,397 Total Wholesale and Competitive Retail Revenues 1,566 812 2,275 2,650 (2,083) 5,220 Other Revenues from Contracts with Customers (d) 236 259 36 10 137 (196) 482 Total Revenues from Contracts with Customers 12,799 6,075 2,311 2,660 137 (2,280) 21,702 Other Revenues: Alternative Revenue Programs (e) 29 51 66 (85) 61 Other Revenues (f) (9) 21 102 7 (8) 113 Total Other Revenues 20 72 66 102 7 (93) 174 Total Revenues $ 12,819 $ 6,147 $ 2,377 $ 2,762 $ 144 $ (2,373) $ 21,876 (a) Amounts include affiliated and nonaffiliated revenues. (b) Amounts include affiliated and nonaffiliated revenues. The affiliated revenues for AEP Transmission Holdco were $1.8 billion. The affiliated revenues for Vertically Integrated Utilities were $211 million. The remaining affiliated amounts were immaterial. …

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STOCK-BASED COMPENSATION The disclosures in this note apply to AEP only. The impact of AEPs share-based compensation plans is insignificant to the financial statements of the Registrant Subsidiaries. AEPs long-term incentive plan available for eligible employees and directors, the American Electric Power System 2015 Long-Term Incentive Plan (2015 LTIP), was replaced prospectively for new grants by the American Electric Power System 2024 Long-Term Incentive Plan (2024 LTIP) effective in April 2024. The 2024 LTIP provides for a maximum of 10 million AEP common shares to be available for grant to eligible employees and directors. As of December 31, 2025, 8,909,934 shares remained available for issuance under the 2024 LTIP. No new awards may be granted under the 2015 LTIP. To the extent the issuance of a share is subject to an outstanding award under the 2015 LTIP, the issuance of that share will take place under the 2015 LTIP. Awards granted under the 2024 LTIP may be made in the form of stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares, performance units, cash-based awards and other stock-based awards. All types of shares issued under the 2024 LTIP including stock options, stock appreciation rights, restricted stock units and performance shares reduce the shares remaining available for grants at a rate of 1 to 1. Cash settled awards do not reduce the number of shares remaining available under the 2024 LTIP. The following sect …

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FAIR VALUE MEASUREMENTS The disclosures in this note apply to all Registrants except AEPTCo unless indicated otherwise. Fair Value Measurements of Long-term Debt (Applies to all Registrants) The fair values of Long-term Debt are based on quoted market prices, without credit enhancements, for the same or similar issues and the current interest rates offered for instruments with similar maturities classified as Level 2 measurement inputs. These instruments are not marked-to-market. The estimates presented are not necessarily indicative of the amounts that could be realized in a current market exchange. The book values and fair values of Long-term Debt are summarized in the following table: December 31, 2025 2024 Company Book Value Fair Value Book Value Fair Value (in millions) AEP $ 47,322 $ 44,930 $ 42,643 $ 38,965 AEP Texas 7,016 6,586 6,442 5,831 AEPTCo 6,599 5,812 5,768 4,853 APCo 6,259 6,147 5,661 5,346 I&M 3,561 3,288 3,494 3,154 OPCo 3,718 3,331 3,716 3,203 PSO 3,526 3,349 2,856 2,562 SWEPCo 4,974 4,603 3,981 3,432 Fair Value Measurements of Other Temporary Investments (Applies to AEP) Other Temporary Investments include marketable securities that management intends to hold for less than one year and investments by AEPs protected cell of EIS. See Other Temporary Investments section of Note 1 for additional information. The following is a summary of Other Temporary Investments and Restricted Cash: December 31, 2025 Gross Gross Unrealized Unrealized Fair Other Temporar …

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INCOME TAXES The disclosures in this note apply to all Registrants unless indicated otherwise. Income Tax Expense (Benefit) The details of the Registrants Income Tax Expense (Benefit) as reported are as follows: Year Ended December 31, 2025 AEP AEP Texas AEPTCo APCo I&M OPCo PSO SWEPCo (in millions) Federal: Current $ (209) $ 27 $ 148 $ 42 $ (3) $ 27 $ (221) $ (180) Deferred 298 70 (173) 43 (14) 42 149 89 Total Federal 89 97 (25) 85 (17) 69 (72) (91) State and Local: Current 28 4 18 2 19 (2) 3 Deferred 12 22 (1) (1) 5 2 (7) Total State and Local 40 4 40 1 18 3 2 (4) Income Tax Expense (Benefit) $ 129 $ 101 $ 15 $ 86 $ 1 $ 72 $ (70) $ (95) Year Ended December 31, 2024 AEP AEP Texas AEPTCo APCo I&M OPCo PSO SWEPCo (in millions) Federal: Current $ (3) $ 22 $ 75 $ 80 $ 17 $ 42 $ (119) $ (112) Deferred (58) 77 89 (18) (119) (3) 20 (86) Total Federal (61) 99 164 62 (102) 39 (99) (198) State and Local: Current (5) 3 6 13 7 3 2 Deferred 27 20 10 (1) 12 Total State and Local 22 3 26 13 7 13 (1) 14 Income Tax Expense (Benefit) $ (39) $ 102 $ 190 $ 75 $ (95) $ 52 $ (100) $ (184) Year Ended December 31, 2023 AEP AEP Texas AEPTCo APCo I&M OPCo PSO SWEPCo (in millions) Federal: Current $ (117) $ 20 $ 94 $ 62 $ 94 $ 46 $ (61) $ (88) Deferred 116 63 52 (60) (57) 3 3 60 Total Federal (1) 83 146 2 37 49 (58) (28) State and Local: Current 69 3 9 6 21 1 Deferred (13) (8) 6 1 5 4 (6) Total State and Local 56 3 1 12 22 5 4 (5) Income Tax Expense (Benefit) $ 55 $ 86 $ 147 $ 14 $ 59 $ 54 …

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LEASES The disclosures in this note apply to all Registrants unless indicated otherwise. The Registrants lease property, plant and equipment including, but not limited to, fleet, information technology and real estate leases. These leases require payments of non-lease components, including related property taxes, operating and maintenance costs. AEP does not separate non-lease components from associated lease components. Many of these leases have purchase or renewal options. Leases not renewed are often replaced by other leases. Options to renew or purchase a lease are included in the measurement of lease assets and liabilities if it is reasonably certain the Registrant will exercise the option. Lease obligations are measured using the discount rate implicit in the lease when that rate is readily determinable. AEP has visibility into the rate implicit in the lease when assets are leased from selected financial institutions under master leasing agreements. When the implicit rate is not readily determinable, the Registrants measure their lease obligation using their estimated secured incremental borrowing rate. Incremental borrowing rates are comprised of an underlying risk-free rate and a secured credit spread relative to the lessee on a matched maturity basis. Operating lease rentals and finance lease amortization costs are generally charged to Other Operation and Maintenance expense in accordance with ratemaking treatment for regulated operations. Interest on finance lease l …

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SEC Climate Disclosure Rule In March 2024, the SEC adopted final rules that would require registrants to disclose certain climate-related information in registration statements and annual reports. Litigation challenging the new rules was filed by multiple parties in multiple jurisdictions, which have been consolidated and assigned to the U.S. Court of Appeals for the Eighth Circuit. In March 2025, the SEC announced that it voted to end its defense of the final climate disclosure rules. In April 2025, 18 states filed a motion to intervene in the case and to hold the case in abeyance until the SEC takes action to amend or rescind the rules. In July 2025, the SEC filed a status report stating that it does not intend to review or reconsider the rules and asked the Court of Appeals to make a ruling on the case. In September 2025, the Court of Appeals issued an order holding the case in abeyance until the SEC either formally defends the rules or initiates a new rulemaking process for reconsideration. ASU 2023-09 Improvements to Income Tax Disclosures (ASU 2023-09) In December 2023, the FASB issued ASU 2023-09, to address investors suggested enhancements to (a) better understand an entitys exposure to potential changes in jurisdictional tax legislation and the ensuing risks and opportunities, (b) assess income tax information that affects cash flow forecasts and capital allocation decisions and (c) identify potential opportunities to increase future cash flows. The new standard requ …

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BENEFIT PLANS The disclosures in this note apply to all Registrants except AEPTCo unless indicated otherwise. For a discussion of investment strategy, investment limitations, target asset allocations and the classification of investments within the fair value hierarchy, see Fair Value Measurements of Assets and Liabilities and Investments Held in Trust for Future Liabilities sections of Note 1. AEPSC sponsors a qualified pension plan and two unfunded non-qualified pension plans. Substantially all AEP subsidiary employees are covered by the qualified plan or both the qualified and a non-qualified pension plan. AEPSC also sponsors OPEB plans to provide health and life insurance benefits for retired employees. Due to the Registrant Subsidiaries participation in AEPs benefit plans, the assumptions used by the actuary, with the exception of the rate of compensation increase, and the accounting for the plans by each subsidiary are the same. This section details the assumptions that apply to all Registrants and the rate of compensation increase for each Registrant. The Registrants recognize the funded status associated with defined benefit pension and OPEB plans on the balance sheets. Disclosures about the plans are required by the Compensation Retirement Benefits accounting guidance. The Registrants recognize an asset for a plans overfunded status or a liability for a plans underfunded status, and recognize, as a component of other comprehensive income, the changes in the funded st …

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RELATED PARTY TRANSACTIONS The disclosures in this note apply to all Registrant Subsidiaries unless indicated otherwise. For other related party transactions, also see Income Taxes and Investment and Production Tax Credits section of Note 1, Corporate Borrowing Program and Securitized Accounts Receivables AEP Credit sections of Note 15 and Gigawatt AI section of Note 18. Intercompany Billings The Registrant Subsidiaries and other AEP subsidiaries perform certain utility services for each other when necessary or practical. The costs of these services are billed on a direct-charge basis, whenever possible, or on reasonable basis of proration for services that benefit multiple companies. The billings for services are made at cost and include no compensation for the use of equity capital. Power Coordination Agreement (Applies to all Registrant Subsidiaries except AEP Texas and AEPTCo) Effective January 1, 2014, the FERC approved the PCA. Under the PCA, APCo, I&M, KPCo and WPCo are individually responsible for planning their respective capacity obligations. The PCA allows, but does not obligate, APCo, I&M, KPCo and WPCo to participate collectively under a common fixed resource requirement capacity plan in PJM and to participate in specified collective Off-system Sales and purchase activities. AEPSC conducts power, capacity, coal, natural gas, interest rate and, to a lesser extent, heating oil, gasoline and other risk management activities on behalf of APCo, I&M, KPCo, …

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VOLUNTARY SEVERANCE PROGRAM In April 2024, management announced a voluntary severance program designed to achieve a reduction in the size of AEPs workforce. Approximately 7,400 of AEPs 16,800 employees were eligible to participate in the program. Approximately 1,000 employees chose to take the voluntary severance package and substantially all terminated employment in July 2024. The severance program provides two weeks of base pay for every year of service with a minimum of four weeks and a maximum of 52 weeks of base pay. Certain positions impacted by the voluntary severance program were refilled to maintain safe, effective and efficient operations. The program was completed to help offset increasing operating expenses and high interest costs. AEP recorded a charge to expense in the second quarter of 2024 related to this voluntary severance program. AEP AEP Texas AEPTCo APCo I&M OPCo PSO SWEPCo (in millions) Severance Expense Incurred $ 122 $ 20 $ 11 $ 26 $ 15 $ 15 $ 10 $ 17 These expenses were primarily included in Other Operation and Maintenance on the statements of income and Other Current Liabilities on the balance sheets. Settlement accounting was triggered for the qualified pension plan in November 2024 under the accounting guidance for Compensation - Retirement Benefits and a settlement charge of $90 million was recorded. As of December 31, 2025, all incurred expenses have been settled. AEP will seek approval for the pension expense related to regulated operations. …

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REVENUE FROM CONTRACTS WITH CUSTOMERS The disclosures in this note apply to all Registrants, unless indicated otherwise. Disaggregated Revenues from Contracts with Customers The tables below represent AEPs reportable segment revenues from contracts with customers, net of respective provisions for refund, by type of revenue: Year Ended December 31, 2025 VIU T&D AEPTHCo G&M Corporate and Other Reconciling Adjustments AEP Consolidated (in millions) Retail Revenues: Residential Revenues $ 4,969 $ 2,785 $ $ $ $ $ 7,754 Commercial Revenues 3,068 1,626 4,694 Industrial Revenues (a) 2,718 533 (1) 3,250 Other Retail Revenues 242 60 302 Total Retail Revenues 10,997 5,004 (1) 16,000 Wholesale and Competitive Retail Revenues: Generation Revenues 1,033 187 1,220 Transmission Revenues (b) 533 812 2,275 (2,017) 1,603 Retail, Trading and Marketing Revenues (c) 2,463 (66) 2,397 Total Wholesale and Competitive Retail Revenues 1,566 812 2,275 2,650 (2,083) 5,220 Other Revenues from Contracts with Customers (d) 236 259 36 10 137 (196) 482 Total Revenues from Contracts with Customers 12,799 6,075 2,311 2,660 137 (2,280) 21,702 Other Revenues: Alternative Revenue Programs (e) 29 51 66 (85) 61 Other Revenues (f) (9) 21 102 7 (8) 113 Total Other Revenues 20 72 66 102 7 (93) 174 Total Revenues $ 12,819 $ 6,147 $ 2,377 $ 2,762 $ 144 $ (2,373) $ 21,876 (a) Amounts include affiliated and nonaffiliated revenues. (b) Amounts include affiliated and nonaffiliated revenues. The affiliated revenues fo …

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BUSINESS SEGMENTS The disclosures in this note apply to all Registrants unless indicated otherwise. AEPs Reportable Segments AEPs primary business is the generation, transmission and distribution of electricity. Within its Vertically Integrated Utilities segment, AEP centrally dispatches generation assets and manages its overall utility operations on an integrated basis because of the substantial impact of cost-based rates and regulatory oversight applicable to each public utility subsidiary. Intersegment sales and transfers are generally based on underlying contractual arrangements and agreements. The CODM of AEP is the President and CEO of AEP, who makes operating decisions, allocates resources to and assesses performance based on these reportable segments. The CODM uses earnings (loss) attributable to AEP common shareholders (presented on a GAAP basis) as a measure of segment profit or loss in making these decisions. Earnings (loss) attributable to AEP common shareholders includes intercompany revenues and expenses that are eliminated on the consolidated financial statements. AEPs reportable segments and their related business activities are outlined below: Vertically Integrated Utilities Generation, transmission and distribution of electricity for sale to retail and wholesale customers through assets owned and operated by AEGCo, APCo, I&M, KGPCo, KPCo, PSO, SWEPCo and WPCo. Transmission and Distribution Utilities Transmission and distribution of electricity for sale t …

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FINANCING ACTIVITIES The disclosures in this note apply to all Registrants, unless indicated otherwise. Common Stock (Applies to AEP) ATM Program In November 2025, AEP filed a prospectus supplement under which it may sell up to $3.5 billion of its common stock through an ATM program. In first quarter 2026, 2 million shares of common stock were issued for $264 million in net proceeds. In addition to these issuances and sales of shares of common stock, AEP also may use the ATM program to enter into forward sale agreements. See below for information regarding shares issued or expected to be issued under forward sale agreements. Forward Equity Agreements AEP has entered into the following forward sales under its ATM program and its March 2025 and May 2026 forward sale of equity agreements as follows: Final Maturity Common Shares into Forward (Number of Shares) Settled (Number of Shares) (a) Settled (a) Common Shares Remaining in Forward (Number of Shares) Expected Proceeds (b) (in millions) March 2025 Forward Sale December 2026 23 5 $ 500 18 $ 1,728 ATM Forward December 2026 3 3 374 May 2026 Forward Sale May 2028 24 24 2,932 (a) The 5 million shares were settled in fiscal year end 2025. (b) Actual cash proceeds will be impacted by the timing of settlement. Forward prices are based on the public offering price (net of underwriting fees), increased for the overnight bank funding rate, less a spread and less expected dividends on AEPs common stock during the period the agreements ar …

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The tables below represent AEPs reportable segment and Registrant Subsidiary revenues from contracts with customers, net of respective provisions for refund, by type of revenue: Three Months Ended June 30, 2026 VIU (a) T&D AEPTHCo G&M Corporate and Other Reconciling Adjustments AEP Consolidated (in millions) Retail Revenues: Residential Revenues $ 1,072 $ 662 $ $ $ $ $ 1,734 Commercial Revenues 852 473 1,325 Industrial Revenues (b) 702 145 847 Other Retail Revenues 60 14 74 Total Retail Revenues 2,686 1,294 3,980 Wholesale and Competitive Retail Revenues: Generation Revenues 236 47 283 Transmission Revenues (c) 153 223 599 (538) 437 Retail, Trading and Marketing Revenues (d) 603 (16) 587 Total Wholesale and Competitive Retail Revenues 389 223 599 650 (554) 1,307 Other Revenues from Contracts with Customers (e) 77 53 18 48 28 (50) 174 Total Revenues from Contracts with Customers 3,152 1,570 617 698 28 (604) 5,461 Other Revenues: Alternative Revenue Programs (f) (10) 9 (7) (8) Other Revenues (b) (g) (22) 4 11 2 (3) (8) Total Other Revenues (32) 13 (7) 11 2 (3) (16) Total Revenues $ 3,120 $ 1,583 $ 610 $ 709 $ 30 $ (607) $ 5,445 (a) Beginning in the first quarter of 2026, PSO and SWEPCo incorporated fuel-related amounts into unbilled revenues to reflect consideration earned but not yet invoiced as of the balance sheet date. The impact of this change did not have a material impact on the financial statements or related disclosures. (b) Amounts include immaterial affiliate …

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FAIR VALUE MEASUREMENTS The disclosures in this note apply to all Registrants except AEPTCo unless indicated otherwise. Fair Value Hierarchy and Valuation Techniques The accounting guidance for Fair Value Measurement establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). Where observable inputs are available for substantially the full term of the asset or liability, the instrument is categorized in Level 2. When quoted market prices are not available, pricing may be completed using comparable securities, dealer values, operating data and general market conditions to determine fair value. Valuation models utilize various inputs such as commodity, interest rate and, to a lesser degree, volatility and credit that include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in inactive markets, market corroborated inputs (i.e. inputs derived principally from, or correlated to, observable market data) and other observable inputs for the asset or liability. For commercial activities, exchange-traded derivatives, namely futures contracts, are generally fair valued based on unadjusted quoted prices in active markets and are classified as Level 1. Level 2 inputs pr …

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INCOME TAXES The disclosures in this note apply to all Registrants unless indicated otherwise. Effective Tax Rates (ETR) The Registrants interim ETR reflect the estimated annual ETR for 2026 and 2025, adjusted for tax expense associated with certain discrete items. The ETR for each of the Registrants are included in the following tables: Three Months Ended June 30, 2026 AEP AEP Texas AEPTCo APCo I&M OPCo PSO SWEPCo U.S. Federal Statutory Rate 21.0 % 21.0 % 21.0 % 21.0 % 21.0 % 21.0 % 21.0 % 21.0 % Increase (Decrease) due to: State and Local Income Taxes, Net 3.5 % 0.6 % 2.4 % (0.5) % 3.8 % 1.0 % 3.0 % (7.7) % Tax Reform Excess ADIT Reversal (3.2) % (1.5) % 0.2 % (5.4) % (2.6) % (11.3) % (6.7) % (4.1) % Production and Investment Tax Credits (13.0) % (0.1) % % (13.8) % (13.7) % % (156.3) % (110.8) % Reversal of Origination Flow-Through 0.8 % 0.1 % 0.2 % 2.3 % 1.5 % 0.6 % 0.3 % 1.1 % AFUDC Equity (1.6) % (1.6) % (1.9) % (1.0) % (0.8) % (1.8) % (1.4) % (2.7) % Other (1.0) % 0.2 % (0.1) % (0.6) % (0.7) % 0.4 % (5.4) % (1.6) % Effective Income Tax Rate 6.5 % 18.7 % 21.8 % 2.0 % 8.5 % 9.9 % (145.5) % (104.8) % Three Months Ended June 30, 2025 AEP AEP Texas AEPTCo APCo I&M OPCo PSO SWEPCo U.S. Federal Statutory Rate 21.0 % 21.0 % 21.0 % 21.0 % 21.0 % 21.0 % 21.0 % 21.0 % Increase (Decrease) due to: State and Local Income Taxes, Net 0.6 % 0.9 % 2.5 % 0.8 % 1.1 % 1.0 % 3.2 % (2.8) % Tax Reform Excess ADIT Reversal (0.4) % (2.1) % 0.6 % (2.0) % 2.8 % (2.7) % (2.7) % 2.5 % Remeas …

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SEC Climate Disclosure Rule In March 2024, the SEC adopted final rules that would require registrants to disclose certain climate-related information in registration statements and annual reports. Litigation challenging the new rules was filed by multiple parties in multiple jurisdictions, which have been consolidated and assigned to the U.S. Court of Appeals for the Eighth Circuit. In March 2025, the SEC announced that it voted to end its defense of the final climate disclosure rules. In April 2025, 18 states filed a motion to intervene in the case and to hold the case in abeyance until the SEC takes action to amend or rescind the rules. In July 2025, the SEC filed a status report stating that it does not intend to review or reconsider the rules and asked the Court of Appeals to make a ruling on the case. In September 2025, the Court of Appeals issued an order holding the case in abeyance until the SEC either formally defends the rules or initiates a new rulemaking process for reconsideration. In May 2026, the SEC formally proposed to rescind its climate-related disclosure rules. The proposal is subject to notice-and-comment rulemaking before a final rule can be approved. ASU 2024-03 Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (ASU 2024-03) In November 2024, the FASB issued ASU 2024-03, the intent of which is to improve financial reporting and respond to investor input by requiring public business entities to disclose additional informa …

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BENEFIT PLANS The disclosures in this note apply to all Registrants except AEPTCo. AEPSC sponsors a qualified pension plan and two unfunded non-qualified pension plans. Substantially all AEP subsidiary employees are covered by the qualified plan or both the qualified and a non-qualified pension plan. AEPSC also sponsors OPEB plans to provide health and life insurance benefits for retired employees. Components of Net Periodic Benefit Cost (Credit) Pension Plans Three Months Ended June 30, 2026 AEP AEP Texas APCo I&M OPCo PSO SWEPCo (in millions) Service Cost $ 26 $ 3 $ 3 $ 2 $ 3 $ 1 $ 3 Interest Cost 52 4 6 6 4 2 3 Expected Return on Plan Assets (63) (5) (8) (8) (7) (3) (3) Amortization of Net Actuarial Loss 11 1 1 1 1 1 Settlements (a) 4 (4) 4 Net Periodic Benefit Cost (Credit) $ 30 $ (1) $ 2 $ 1 $ 1 $ 5 $ 3 Three Months Ended June 30, 2025 AEP AEP Texas APCo I&M OPCo PSO SWEPCo (in millions) Service Cost $ 24 $ 2 $ 2 $ 2 $ 3 $ 2 $ 2 Interest Cost 53 4 7 7 4 2 3 Expected Return on Plan Assets (71) (5) (10) (10) (8) (3) (3) Amortization of Net Actuarial Loss 4 1 1 1 Net Periodic Benefit Cost (Credit) $ 10 $ 2 $ (1) $ $ $ 1 $ 2 Six Months Ended June 30, 2026 AEP AEP Texas APCo I&M OPCo PSO SWEPCo (in millions) Service Cost $ 51 $ 5 $ 5 $ 5 $ 5 $ 3 $ 5 Interest Cost 103 8 12 12 9 5 6 Expected Return on Plan Assets (128) (10) (16) (16) (13) (7) (7) Amortization of Net Actuarial Loss 21 2 2 2 2 1 1 Settlements (a) (7) (8) (6) 4 Net Periodic Benefit Cost (Credit) $ 40 $ …

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REVENUE FROM CONTRACTS WITH CUSTOMERS The disclosures in this note apply to all Registrants, unless indicated otherwise. Disaggregated Revenues from Contracts with Customers The tables below represent AEPs reportable segment and Registrant Subsidiary revenues from contracts with customers, net of respective provisions for refund, by type of revenue: Three Months Ended June 30, 2026 VIU (a) T&D AEPTHCo G&M Corporate and Other Reconciling Adjustments AEP Consolidated (in millions) Retail Revenues: Residential Revenues $ 1,072 $ 662 $ $ $ $ $ 1,734 Commercial Revenues 852 473 1,325 Industrial Revenues (b) 702 145 847 Other Retail Revenues 60 14 74 Total Retail Revenues 2,686 1,294 3,980 Wholesale and Competitive Retail Revenues: Generation Revenues 236 47 283 Transmission Revenues (c) 153 223 599 (538) 437 Retail, Trading and Marketing Revenues (d) 603 (16) 587 Total Wholesale and Competitive Retail Revenues 389 223 599 650 (554) 1,307 Other Revenues from Contracts with Customers (e) 77 53 18 48 28 (50) 174 Total Revenues from Contracts with Customers 3,152 1,570 617 698 28 (604) 5,461 Other Revenues: Alternative Revenue Programs (f) (10) 9 (7) (8) Other Revenues (b) (g) (22) 4 11 2 (3) (8) Total Other Revenues (32) 13 (7) 11 2 (3) (16) Total Revenues $ 3,120 $ 1,583 $ 610 $ 709 $ 30 $ (607) $ 5,445 (a) Beginning in the first quarter of 2026, PSO and SWEPCo incorporated fuel-related amounts into unbilled revenues to reflect consideration earned but not yet invoiced as of …

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BUSINESS SEGMENTS The disclosures in this note apply to all Registrants unless indicated otherwise. AEPs Reportable Segments AEPs primary business is the generation, transmission and distribution of electricity. Within its Vertically Integrated Utilities segment, AEP centrally dispatches generation assets and manages its overall utility operations on an integrated basis because of the substantial impact of cost-based rates and regulatory oversight applicable to each public utility subsidiary. Intersegment sales and transfers are generally based on underlying contractual arrangements and agreements. The CODM of AEP is the President and CEO of AEP, who makes operating decisions, allocates resources to and assesses performance based on these reportable segments. The CODM uses earnings (loss) attributable to AEP common shareholders (presented on a GAAP basis) as a measure of segment profit or loss in making these decisions. Earnings (loss) attributable to AEP common shareholders includes intercompany revenues and expenses that are eliminated on the consolidated financial statements. AEPs reportable segments and their related business activities are outlined below: Vertically Integrated Utilities Generation, transmission and distribution of electricity for sale to retail and wholesale customers through assets owned and operated by AEGCo, APCo, I&M, KGPCo, KPCo, PSO, SWEPCo and WPCo. Transmission and Distribution Utilities Transmission and distribution of electricity for sale t …

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SIGNIFICANT ACCOUNTING MATTERS The disclosures in this note apply to all Registrants unless indicated otherwise. General The unaudited condensed financial statements and footnotes were prepared in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the SEC. Accordingly, they do not include all of the information and footnotes required by GAAP for complete annual financial statements. In the opinion of management, the unaudited condensed interim financial statements reflect all normal and recurring accruals and adjustments necessary for a fair statement of the net income, financial position and cash flows for the interim periods for each Registrant. Net income for the three and six months ended June 30, 2026 is not necessarily indicative of results that may be expected for the year ending December 31, 2026. The condensed financial statements are unaudited and should be read in conjunction with the audited 2025 financial statements and notes thereto, which are included in the 2025 Annual Reports. Change in Presentation In 2025, the Company changed its rounding presentation in the Registrants financial statements and accompanying tabular footnote disclosures to the nearest whole number in millions, except per share data. The change had no material impact on previously reported financial information, however, certain amounts reported for prior periods may differ by insignificant amounts due to the round …

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SUBSEQUENT EVENTS In July 2026, AGR entered into a PSA to acquire a 710 MW coal-fired generation facility located in Monongalia County, West Virginia. The transaction is subject to customary closing conditions, including approval from the FERC and other required governmental approvals. The agreement was signed to support growing energy demand in the region and strengthen AEP's ability to provide reliable power at affordable prices. The Company currently expects the acquisition to close in the fourth quarter of 2026 or the first quarter of 2027, although the timing and ultimate completion of the transaction are subject to receiving the required regulatory approvals and other closing conditions.

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