--- ticker: EIX company: Edison International filing_type: 10-K year_current: 2026 year_prior: 2025 risks_added: 3 risks_removed: 2 risks_modified: 43 risks_unchanged: 45 source: SEC EDGAR url: https://riskdiff.com/eix/2026-vs-2025/ markdown_url: https://riskdiff.com/eix/2026-vs-2025/index.md generated: 2026-06-01 --- # Edison International: 10-K Risk Factor Changes 2026 vs 2025 > Source: U.S. Securities and Exchange Commission (EDGAR) > Generated: 2026-06-01 > All data extracted directly from official filings. No hallucinated content. ## Summary | Status | Count | |--------|-------| | New risks added | 3 | | Risks removed | 2 | | Risks modified | 43 | | Unchanged | 45 | --- ## New in Current Filing: Contingencies Edison International and SCE record loss contingencies when management determines that the outcome of future events is probable of occurring and when the amount of the loss can be reasonably estimated. For material contingencies when there is a reasonable possibility that a loss or an additional loss may be incurred, Edison International and SCE disclose the nature of the contingency and an estimate of the possible loss or range of loss or a statement that such an estimate cannot be made. Gain contingencies are recognized in the financial statements when they are realized. Legal costs expected to be incurred by Edison International and SCE in connection with loss contingencies are expensed as incurred. The determination of an accrual for a loss contingency is based on management judgment and estimates with respect to the likely outcome of the matter, including the analysis of different scenarios. Recorded liabilities are adjusted when events or circumstances cause these judgments or estimates to change, including subsequent events. In assessing whether a loss is a reasonable possibility, Edison International and SCE may consider the following factors, among others: the nature of the litigation, claim or assessment, opinions or views of legal counsel and other advisors, and the experience gained from similar cases. --- ## New in Current Filing: Debt Financing Subsequent to December 31, 2025 In February 2026, SCE entered into a term loan agreement to borrow up to $300 million that mature in March 2027 with a variable interest rate based on either SOFR plus 1.00% or a base rate. The proceeds were used for general corporate and working capital purposes. In February 2026, SCE entered into a term loan agreement to borrow up to $300 million that mature in March 2027 with a variable interest rate based on either SOFR plus 1.00% --- ## New in Current Filing: Income taxes Paid/(Refunded) The components of income tax paid net of (refunds) by location of taxing jurisdiction are: Edison InternationalSCEYears ended December 31,(in millions)202520242023202520242023Federal$(236)$ - $ - $(236)$4 $ - California - 51 - 8 74 - SCE makes tax-allocation payments to Edison International under the applicable tax-allocation agreement. It does not make payments to the tax authorities directly. The amount included in 2025 relates to proceeds from the monetization of investment and production tax credits. 82 82 82 Table of Contents Table of Contents --- ## No Match in Current: Severance Costs *This section from the 2025 filing does not have a high-confidence textual match in 2026. It may have been removed, merged, or substantially reworded.* Severance costs are recorded when it is probable that employees will be entitled to benefits under an existing plan and the amount can be reasonably estimated. As a result of current and probable reductions in workforce, SCE recorded estimated severance costs of $53 million for the year ended December 31, 2024. Severance costs are included in "Operation and maintenance" on the consolidated statements of income. The severance costs are partially offset by $3 million expected FERC recovery, which is recorded in "Operating Revenue" on the consolidated statements of income. --- ## No Match in Current: Debt Financing Subsequent to December 31, 2024 *This section from the 2025 filing does not have a high-confidence textual match in 2026. It may have been removed, merged, or substantially reworded.* In January 2025, SCE issued $850 million of 5.45% first and refunding mortgage bonds due in 2035 and $650 million of 5.90% first and refunding mortgage bonds due in 2055. The proceeds were used to repay commercial paper borrowings and for general corporate purposes. --- ## Modified: Employee Savings Plan **Key changes:** - Reworded sentence: "The employer contributions were as follows: EdisonInternationalSCE(in millions)Years ended December 31,2025$144 $143 2024136 134 2023121 119" **Prior (2025):** The 401(k) defined contribution savings plan is designed to supplement employees' retirement income. The employer contributions were as follows: EdisonInternationalSCE(in millions)Years ended December 31,2024$136 $134 2023121 119 2022103 101 **Current (2026):** The 401(k) defined contribution savings plan is designed to supplement employees' retirement income. The employer contributions were as follows: EdisonInternationalSCE(in millions)Years ended December 31,2025$144 $143 2024136 134 2023121 119 --- ## Modified: Nuclear Decommissioning and Asset Retirement Obligations **Key changes:** - Reworded sentence: "64 64 64 Table of Contents Table of Contents The following table summarizes the changes in SCE's ARO liability: December 31,(in millions)20252024Beginning balance$2,580 $2,666 Accretion1145 137 Revisions24 (2)Liabilities settled(166)(221)Ending balance$2,583 $2,580 Accretion1 1Accretion is an increase in the liability to account for the time value of money for this present value liability." - Reworded sentence: "The ARO for decommissioning SCE's San Onofre and Palo Verde nuclear power facilities was $2.0 billion as of December 31, 2025." - Reworded sentence: "SCE currently estimates that it will spend approximately $7.4 billion through 2098 to decommission its nuclear facilities." **Prior (2025):** The fair value of a liability for an ARO is recorded in the period in which it is incurred, including a liability for the fair value of a conditional ARO, if the fair value can be reasonably estimated even though uncertainty exists about the timing and/or method of settlement. When an ARO liability is initially recorded, SCE capitalizes the cost by increasing the carrying amount of the related long-lived asset. For each subsequent period, the liability is increased for accretion expense and the capitalized cost is depreciated over the useful life of the related asset. SCE has not recorded an ARO for assets that are expected to operate indefinitely or where SCE cannot estimate a settlement date (or range of potential settlement dates). As such, ARO liabilities are not recorded for certain retirement activities, including certain hydroelectric facilities. The following table summarizes the changes in SCE's ARO liability: December 31,(in millions)20242023Beginning balance$2,666 $2,754 Accretion1137 144 Revisions(2)(3)Liabilities settled(221)(229)Ending balance$2,580 $2,666 Accretion1 1An ARO represents the present value of a future obligation. Accretion is an increase in the liability to account for the time value of money resulting from discounting. AROs related to decommissioning of SCE's nuclear power facilities are based on site-specific studies conducted as part of each NDCTP conducted before the CPUC. ARO are revised when updated site-specific decommissioning cost estimates are available. The ARO for decommissioning SCE's San Onofre and Palo Verde nuclear power facilities was $2.1 billion as of December 31, 2024. The liability to decommission SCE's nuclear power facilities is based on a 2024 decommissioning study, filed as part of the 2024 NDCTP, for San Onofre Unit 1, 2, and 3 and a 2023 decommissioning study for Palo Verde. Decommissioning of San Onofre Unit 1 began in 1999 and the transfer of spent nuclear fuel from Unit 1 to dry cask storage in the Independent Spent Fuel Storage Installation ("ISFSI") 1 was completed in 2005. Major decommissioning work for Unit 1 has been completed except for certain underground work. Decommissioning of San Onofre Units 2 and 3 began in June 2013 and the transfer of spent nuclear fuel from San Onofre Units 2 and 3 to dry cask storage in the two ISFSIs was completed in August 2020. In August 2020, SCE commenced, and is currently conducting major decommissioning activities in accordance with the terms of the Coastal Developmental Permit for San Onofre Units 2 and 3. 65 65 65 Table of Contents Table of Contents Due to regulatory recovery of SCE's nuclear decommissioning expense, prudently incurred costs for nuclear decommissioning activities do not affect SCE's earnings. Through the ratemaking process, SCE has substantially collected in rates, as a component of depreciation expense, all amounts for the future decommissioning of its nuclear assets and has placed those amounts in independent trusts. Amounts collected in rates in excess of the ARO liability are classified as ARO regulatory liabilities. See Note 11 for further information. Amortization of the ARO asset (included within the unamortized nuclear investment) and accretion of the ARO liability are deferred as decreases to the ARO regulatory liability account, resulting in no impact on earnings. Changes in the estimated costs, timing of decommissioning or the assumptions underlying these estimates could cause material revisions to the estimated total cost to decommission. SCE currently estimates that it will spend approximately $7.6 billion through 2098 to decommission its nuclear facilities. This estimate is based on SCE's decommissioning cost methodology used for ratemaking purposes, escalated at rates ranging from 2.1% to 7.5% (depending on the cost element) annually. These costs are expected to be funded from independent decommissioning trusts. SCE estimates annual after-tax earnings on the decommissioning funds of 3.6% to 5.7% dependent on asset class. If the estimated costs increase, the assumed return on trust assets is not earned, or costs escalate at higher rates, SCE expects that additional funds needed for decommissioning will be recoverable through future rates, subject to a reasonableness review. See Note 10 for further information. SCE's nuclear decommissioning costs are subject to CPUC review through the triennial regulatory proceedings. SCE's nuclear decommissioning trust investments primarily consist of fixed income investments that are classified as available-for-sale and equity investments. Due to regulatory mechanisms, investment earnings and realized gains and losses have no impact on earnings. Unrealized gains and losses on decommissioning trust funds, including impairment, increase or decrease the trust assets and the related regulatory asset or liability and have no impact on electric utility revenue or decommissioning expense. SCE reviews each fixed income security for impairment on the last day of each month. If the fair value on the last day of the month is less than the amortized cost for that security, SCE impairs the disclosed amortized cost. If the fair value is greater or less than the carrying value for that security at the time of sale, SCE recognizes a related realized gain or loss, respectively. **Current (2026):** The fair value of a liability for an ARO is recorded in the period in which it is incurred, including a liability for the fair value of a conditional ARO, if the fair value can be reasonably estimated even though uncertainty exists about the timing and/or method of settlement. When an ARO liability is initially recorded, SCE capitalizes the cost by increasing the carrying amount of the related long-lived asset. For each subsequent period, the liability is increased for accretion expense and the capitalized cost is depreciated over the useful life of the related asset. SCE has not recorded an ARO for assets that are expected to operate indefinitely or where SCE cannot estimate a settlement date (or range of potential settlement dates). As such, ARO liabilities are not recorded for certain retirement activities, including certain hydroelectric facilities. 64 64 64 Table of Contents Table of Contents The following table summarizes the changes in SCE's ARO liability: December 31,(in millions)20252024Beginning balance$2,580 $2,666 Accretion1145 137 Revisions24 (2)Liabilities settled(166)(221)Ending balance$2,583 $2,580 Accretion1 1Accretion is an increase in the liability to account for the time value of money for this present value liability. AROs related to decommissioning of SCE's nuclear power facilities are based on site-specific studies conducted as part of each NDCTP conducted before the CPUC. ARO are revised when updated site-specific decommissioning cost estimates are available. The ARO for decommissioning SCE's San Onofre and Palo Verde nuclear power facilities was $2.0 billion as of December 31, 2025. The liability to decommission SCE's nuclear power facilities is based on a 2024 decommissioning study, filed as part of the 2024 NDCTP, for Units 1, 2, and 3 and a 2023 decommissioning study for Palo Verde. Due to regulatory recovery of SCE's nuclear decommissioning expense, prudently incurred costs for nuclear decommissioning activities do not affect SCE's earnings. Through the ratemaking process, SCE has substantially collected in rates, as a component of depreciation expense, all amounts for the future decommissioning of its nuclear assets and has placed those amounts in independent trusts. Amounts collected in rates in excess of the ARO liability are classified as ARO regulatory liabilities. See Note 11 for further information. Amortization of the ARO asset (included within the unamortized nuclear investment) and accretion of the ARO liability are deferred as decreases to the ARO regulatory liability account, resulting in no impact on earnings. Changes in the estimated costs, timing of decommissioning or the assumptions underlying these estimates could cause material revisions to the estimated total cost to decommission. SCE currently estimates that it will spend approximately $7.4 billion through 2098 to decommission its nuclear facilities. This estimate is based on SCE's decommissioning cost methodology used for ratemaking purposes, escalated at rates ranging from 2.1% to 7.5% (depending on the cost element) annually. These costs are expected to be funded from independent decommissioning trusts. SCE estimates annual after-tax earnings on the decommissioning funds of 3.6% to 5.7% dependent on asset class. If the estimated costs increase, the assumed return on trust assets is not earned, or costs escalate at higher rates, SCE expects that additional funds needed for decommissioning will be recoverable through future rates, subject to a reasonableness review. See Note 10 for further information. SCE's nuclear decommissioning costs are subject to CPUC review through the triennial regulatory proceedings. SCE's nuclear decommissioning trust investments primarily consist of fixed income investments that are classified as available-for-sale and equity investments. Due to regulatory mechanisms, investment earnings and realized gains and losses have no impact on earnings. Unrealized gains and losses on decommissioning trust funds, including impairment, increase or decrease the trust assets and the related regulatory asset or liability and have no impact on electric utility revenue or decommissioning expense. SCE reviews each fixed income security for impairment on the last day of each month. If the fair value on the last day of the month is less than the amortized cost for that security, SCE impairs the disclosed amortized cost. If the fair value is greater or less than the carrying value for that security at the time of sale, SCE recognizes a related realized gain or loss, respectively. --- ## Modified: Consolidated Statements of Changes in EquityEdison International **Key changes:** - Reworded sentence: "Equity Attributable to Edison International ShareholdersNoncontrollingInterestsPreferred stockCommon stockAccumulatedOtherComprehensive(Loss) IncomeRetainedEarningsSubtotalPreferenceStockTotalEquity(in millions, except shares and per share amounts)SharesAmountSharesAmountBalance at December 31, 20222,000,000 $1,978 382,208,498 $6,200 $(11)$7,454 $15,621 $1,901 $17,522 Net income - - - - - 1,284 1,284 123 1,407 Other comprehensive income - - - - 2 - 2 - 2 Common stock issued - - 1,716,414 92 - - 92 - 92 Common stock dividends declared ($2.9925 per share) - - - - - (1,147)(1,147) - (1,147)Preferred stock dividend accrued ($53.75 per share for Series A and $50 per share for Series B) - - - - - (108)(108) - (108)Dividends to noncontrolling interests ($96.8230 - $143.75 per share for preference stock) - - - - - - - (123)(123)Noncash stock-based compensation - - - 46 - - 46 - 46 Preference stock issued, net of issuance cost - - - - - - - 542542 Preferred stock repurchased(308,229)(305) - - - 16(289) - (289)Balance at December 31, 20231,691,771 1,673 383,924,912 6,338 (9)7,499 15,501 2,443 17,944 Net income - - - - - 1,371 1,371 175 1,546 Other comprehensive income - - - - 9 - 9 - 9 Common stock issued - - 3,272,010 158 - - 158 - 158 Common stock repurchased - - (2,412,203)(200) - - (200) - (200)Common stock dividends declared ($3.1675 per share) - - - - - (1,221)(1,221) - (1,221)Preferred stock dividend declared ($53.75 per share for Series A and $50.00 per share for Series B) - - - - - (88)(88) - (88)Dividends to noncontrolling interests ($24.418 - $199.479 per share for preference stock) - - - - - 6 6 (160)(154)Noncash stock-based compensation - - - 57 - - 57 - 57 Preference stock issued, net of issuance cost - - - - - - - 345 345 Preference stock redeemed - - - - - - - (628)(628)Preferred stock repurchased(29,000)(28) - - - - (28) - (28)Balance at December 31, 20241,662,771 1,645 384,784,719 6,353 - 7,567 15,565 2,175 17,740 Net income - - - - - 4,557 4,557 144 4,701 Other comprehensive income - - - - 6 - 6 - 6 Common stock issued - - 553,336 5 - - 5 - 5 Common stock repurchased - - (550,999)(32) - - (32) - (32)Common stock dividends declared ($3.36 per share) - - - - - (1,293)(1,293) - (1,293)Preferred stock dividend declared ($53.75 per share for Series A and $50.00 per share for Series B) - - - - - (104)(104) - (104)Dividends to noncontrolling interests ($125 - $187.5 per share for preference stock) - - - - - (1)(1)(135)(136)Shares withheld for tax withholdings on vested equity awards - - (21) - - (21) - (21)Noncash stock-based compensation - - - 57 - - 57 - 57 Preference stock redeemed and repurchased - - - - - - - (504)(504)Preferred stock repurchased(1,160,492)(1,148) - - - (12)(1,160) - (1,160)Balance at December 31, 2025502,279 $497 384,787,056 $6,362 $6 $10,714 $17,579 $1,680 $19,259 Preferred stock Common stock Shares Amount Shares Amount Common stock dividends declared ($2.9925 per share) Preferred stock dividend accrued ($53.75 per share for Series A and $50 per share for Series B) Dividends to noncontrolling interests ($96.8230 - $143.75 per share for preference stock) Preference stock issued, net of issuance cost Preferred stock repurchased Common stock dividends declared ($3.1675 per share) Preferred stock dividend declared ($53.75 per share for Series A and $50.00 per share for Series B) Dividends to noncontrolling interests ($24.418 - $199.479 per share for preference stock) Preference stock redeemed Common stock dividends declared ($3.36 per share) Preferred stock dividend declared ($53.75 per share for Series A and $50.00 per share for Series B) Dividends to noncontrolling interests ($125 - $187.5 per share for preference stock) Shares withheld for tax withholdings on vested equity awards The accompanying notes are an integral part of these consolidated financial statements." **Prior (2025):** Equity Attributable to Edison International ShareholdersNoncontrollingInterests(in millions, except per share amounts)PreferredStockCommonStockAccumulatedOtherComprehensiveLossRetainedEarningsSubtotalPreferenceStockTotalEquityBalance at December 31, 2021$1,977 $6,071 $(54)$7,894 $15,888 $1,901 $17,789 Net income - - - 717 717 107 824 Other comprehensive income - - 43 - 43 - 43 Common stock issued - 87 - - 87 - 87 Common stock dividends declared ($2.8375 per share) - - - (1,083)(1,083) - (1,083)Preferred stock dividend accrued ($53.75 per share for Series A and $42.08333 per share for Series B) - - - (74)(74) - (74)Dividends to noncontrolling interests ($65.1098 - $143.75 per share for preference stock) - - - - - (107)(107)Noncash stock-based compensation - 42 - - 42 - 42 Other1 - - - 1 - 1 Balance at December 31, 20221,978 6,200 (11)7,454 15,621 1,901 17,522 Net income - - - 1,284 1,284 123 1,407 Other comprehensive income - - 2 - 2 - 2 Common stock issued - 92 - - 92 - 92 Common stock dividends declared ($2.9925 per share) - - - (1,147)(1,147) - (1,147)Preferred stock dividend declared ($53.75 per share for Series A and $50.00 per share for Series B) - - - (108)(108) - (108)Dividends to noncontrolling interests ($96.823 - $143.75 per share for preference stock) - - - - - (123)(123)Noncash stock-based compensation - 46 - - 46 - 46 Preference stock issued, net of issuance cost - - - - - 542 542 Preferred stock repurchased(305) - - 16 (289) - (289)Balance at December 31, 20231,673 6,338 (9)7,499 15,501 2,443 17,944 Net income - - - 1,371 1,371 175 1,546 Other comprehensive income - - 9 - 9 - 9 Common stock issued - 158 - - 158 - 158 Common stock repurchased - (200) - - (200) - (200)Common stock dividends declared ($3.1675 per share) - - - (1,221)(1,221) - (1,221)Preferred stock dividend declared ($53.75 per share for Series A and $50.00 per share for Series B) - - - (88)(88) - (88)Dividends to noncontrolling interests ($24.418 - $199.479 per share for preference stock) - - - 6 6 (160)(154)Noncash stock-based compensation - 57 - - 57 - 57 Preference stock issued, net of issuance cost - - - - - 345 345 Preference stock redeemed - - - - - (628)(628)Preferred stock repurchased(28) - - - (28) - (28)Balance at December 31, 2024$1,645 $6,353 $ - $7,567 $15,565 $2,175 $17,740 The accompanying notes are an integral part of these consolidated financial statements. Common stock dividends declared ($2.8375 per share) Preferred stock dividend accrued ($53.75 per share for Series A and $42.08333 per share for Series B) Dividends to noncontrolling interests ($65.1098 - $143.75 per share for preference stock) Common stock dividends declared ($2.9925 per share) Preferred stock dividend declared ($53.75 per share for Series A and $50.00 per share for Series B) Dividends to noncontrolling interests ($96.823 - $143.75 per share for preference stock) Common stock dividends declared ($3.1675 per share) Preferred stock dividend declared ($53.75 per share for Series A and $50.00 per share for Series B) Dividends to noncontrolling interests ($24.418 - $199.479 per share for preference stock) 54 54 54 Table of Contents Table of Contents (This page has been left blank intentionally.) 55 55 55 Table of Contents Table of Contents **Current (2026):** Equity Attributable to Edison International ShareholdersNoncontrollingInterestsPreferred stockCommon stockAccumulatedOtherComprehensive(Loss) IncomeRetainedEarningsSubtotalPreferenceStockTotalEquity(in millions, except shares and per share amounts)SharesAmountSharesAmountBalance at December 31, 20222,000,000 $1,978 382,208,498 $6,200 $(11)$7,454 $15,621 $1,901 $17,522 Net income - - - - - 1,284 1,284 123 1,407 Other comprehensive income - - - - 2 - 2 - 2 Common stock issued - - 1,716,414 92 - - 92 - 92 Common stock dividends declared ($2.9925 per share) - - - - - (1,147)(1,147) - (1,147)Preferred stock dividend accrued ($53.75 per share for Series A and $50 per share for Series B) - - - - - (108)(108) - (108)Dividends to noncontrolling interests ($96.8230 - $143.75 per share for preference stock) - - - - - - - (123)(123)Noncash stock-based compensation - - - 46 - - 46 - 46 Preference stock issued, net of issuance cost - - - - - - - 542542 Preferred stock repurchased(308,229)(305) - - - 16(289) - (289)Balance at December 31, 20231,691,771 1,673 383,924,912 6,338 (9)7,499 15,501 2,443 17,944 Net income - - - - - 1,371 1,371 175 1,546 Other comprehensive income - - - - 9 - 9 - 9 Common stock issued - - 3,272,010 158 - - 158 - 158 Common stock repurchased - - (2,412,203)(200) - - (200) - (200)Common stock dividends declared ($3.1675 per share) - - - - - (1,221)(1,221) - (1,221)Preferred stock dividend declared ($53.75 per share for Series A and $50.00 per share for Series B) - - - - - (88)(88) - (88)Dividends to noncontrolling interests ($24.418 - $199.479 per share for preference stock) - - - - - 6 6 (160)(154)Noncash stock-based compensation - - - 57 - - 57 - 57 Preference stock issued, net of issuance cost - - - - - - - 345 345 Preference stock redeemed - - - - - - - (628)(628)Preferred stock repurchased(29,000)(28) - - - - (28) - (28)Balance at December 31, 20241,662,771 1,645 384,784,719 6,353 - 7,567 15,565 2,175 17,740 Net income - - - - - 4,557 4,557 144 4,701 Other comprehensive income - - - - 6 - 6 - 6 Common stock issued - - 553,336 5 - - 5 - 5 Common stock repurchased - - (550,999)(32) - - (32) - (32)Common stock dividends declared ($3.36 per share) - - - - - (1,293)(1,293) - (1,293)Preferred stock dividend declared ($53.75 per share for Series A and $50.00 per share for Series B) - - - - - (104)(104) - (104)Dividends to noncontrolling interests ($125 - $187.5 per share for preference stock) - - - - - (1)(1)(135)(136)Shares withheld for tax withholdings on vested equity awards - - (21) - - (21) - (21)Noncash stock-based compensation - - - 57 - - 57 - 57 Preference stock redeemed and repurchased - - - - - - - (504)(504)Preferred stock repurchased(1,160,492)(1,148) - - - (12)(1,160) - (1,160)Balance at December 31, 2025502,279 $497 384,787,056 $6,362 $6 $10,714 $17,579 $1,680 $19,259 Preferred stock Common stock Shares Amount Shares Amount Common stock dividends declared ($2.9925 per share) Preferred stock dividend accrued ($53.75 per share for Series A and $50 per share for Series B) Dividends to noncontrolling interests ($96.8230 - $143.75 per share for preference stock) Preference stock issued, net of issuance cost Preferred stock repurchased Common stock dividends declared ($3.1675 per share) Preferred stock dividend declared ($53.75 per share for Series A and $50.00 per share for Series B) Dividends to noncontrolling interests ($24.418 - $199.479 per share for preference stock) Preference stock redeemed Common stock dividends declared ($3.36 per share) Preferred stock dividend declared ($53.75 per share for Series A and $50.00 per share for Series B) Dividends to noncontrolling interests ($125 - $187.5 per share for preference stock) Shares withheld for tax withholdings on vested equity awards The accompanying notes are an integral part of these consolidated financial statements. 53 53 53 Table of Contents Table of Contents (This page has been left blank intentionally.) 54 54 54 Table of Contents Table of Contents --- ## Modified: Property, Plant and Equipment **Key changes:** - Reworded sentence: "Estimated useful lives authorized by the CPUC in the 2025 GRC and weighted average useful lives of SCE's property, plant and equipment, are as follows: Estimated Useful LivesWeighted AverageUseful LivesGeneration plant15 years to 57 years38 yearsDistribution plant15 years to 66 years49 yearsTransmission plant30 years to 70 years54 yearsGeneral plant and other5 years to 60 years19 years 15 years to 57 years 15 years to 66 years 30 years to 70 years 5 years to 60 years Depreciation of utility property, plant and equipment is computed on a composite straight-line, remaining-life basis." - Reworded sentence: "The following table summarizes SCE's AFUDC related to debt and equity: Years ended December 31,(in millions)202520242023Debt AFUDC1$86 $82 $74 Equity AFUDC2189 187 157 Debt AFUDC1 Equity AFUDC2 1Reflected as a reduction of "Interest expense" on the consolidated statements of income." - Reworded sentence: "62 62 62 Table of Contents Table of Contents Major Maintenance Major maintenance costs for SCE's facilities and equipment are expensed as incurred." **Prior (2025):** SCE plant additions, including replacements and betterments, are capitalized. Direct material and labor and indirect costs such as construction overhead, administrative and general costs, employee benefits, and property taxes are capitalized as part of plant additions. The CPUC authorizes a capitalization rate for each of the indirect costs which are allocated to each project based on either labor or total costs. Estimated useful lives authorized by the CPUC in the 2021 GRC and weighted average useful lives of SCE's property, plant and equipment, are as follows: Estimated Useful LivesWeighted AverageUseful LivesGeneration plant10 years to 54 years39 yearsDistribution plant20 years to 67 years50 yearsTransmission plant30 years to 65 years53 yearsGeneral plant and other5 years to 60 years19 years 10 years to 54 years 20 years to 67 years 30 years to 65 years 5 years to 60 years 63 63 63 Table of Contents Table of Contents Depreciation of utility property, plant and equipment is computed on a straight-line, remaining-life basis. SCE's depreciation expense was $2.8 billion, $2.5 billion and $2.5 billion for 2024, 2023 and 2022, respectively. Depreciation expense stated as a percentage of average original cost of depreciable utility plant was, on a composite basis, 4.3%, 4.1% and 4.2% for 2024, 2023 and 2022, respectively. The original costs of retired property are charged to accumulated depreciation. See Note 2 for further information. Nuclear fuel for Palo Verde is recorded as utility plant (nuclear fuel in the fabrication and installation phase is recorded as construction in progress) in accordance with CPUC ratemaking procedures. Palo Verde nuclear fuel is amortized using the units of production method. Allowance for funds used during construction ("AFUDC") represents the estimated cost of debt and equity funds that finance utility-plant construction and is capitalized during certain plant construction. AFUDC is recovered in rates through depreciation expense over the useful life of the related asset. Equity AFUDC represents a method to compensate SCE for the estimated cost of equity used to finance utility plant additions and is recorded as part of construction in progress. The following table summarizes SCE's AFUDC related to debt and equity: Years ended December 31,(in millions)202420232022Debt AFUDC1$82 $74 $53 Equity AFUDC2187 157 137 Debt AFUDC1 Equity AFUDC2 1Reflected as a reduction of "Interest expense" on the consolidated statements of income. 2Reflected in "Other income" on the consolidated statements of income. Major Maintenance Major maintenance costs for SCE's facilities and equipment are expensed as incurred. **Current (2026):** SCE plant additions, including replacements and betterments, are capitalized. Direct material and labor and indirect costs such as construction overhead, administrative and general costs, employee benefits, and property taxes are capitalized as part of plant additions. The CPUC authorizes a capitalization rate for each of the indirect costs which are allocated to each project based on either labor or total costs. Estimated useful lives authorized by the CPUC in the 2025 GRC and weighted average useful lives of SCE's property, plant and equipment, are as follows: Estimated Useful LivesWeighted AverageUseful LivesGeneration plant15 years to 57 years38 yearsDistribution plant15 years to 66 years49 yearsTransmission plant30 years to 70 years54 yearsGeneral plant and other5 years to 60 years19 years 15 years to 57 years 15 years to 66 years 30 years to 70 years 5 years to 60 years Depreciation of utility property, plant and equipment is computed on a composite straight-line, remaining-life basis. SCE's depreciation expense was $3.1 billion, $2.8 billion and $2.5 billion for 2025, 2024 and 2023, respectively. Depreciation expense stated as a percentage of average original cost of depreciable utility plant was, on a composite basis, 4.5%, 4.3% and 4.1% for 2025, 2024 and 2023, respectively. The original costs of retired property are charged to accumulated depreciation. See Note 2 for further information. Nuclear fuel for Palo Verde is recorded as utility plant (nuclear fuel in the fabrication and installation phase is recorded as construction in progress) in accordance with CPUC ratemaking procedures. Palo Verde nuclear fuel is amortized using the units of production method. Allowance for funds used during construction ("AFUDC") represents the estimated cost of debt and equity funds that finance utility-plant construction and is capitalized during certain plant construction. AFUDC is recovered in rates through depreciation expense over the useful life of the related asset. Equity AFUDC represents a method to compensate SCE for the estimated cost of equity used to finance utility plant additions and is recorded as part of construction in progress. The following table summarizes SCE's AFUDC related to debt and equity: Years ended December 31,(in millions)202520242023Debt AFUDC1$86 $82 $74 Equity AFUDC2189 187 157 Debt AFUDC1 Equity AFUDC2 1Reflected as a reduction of "Interest expense" on the consolidated statements of income. 2Reflected in "Other income" on the consolidated statements of income. 62 62 62 Table of Contents Table of Contents Major Maintenance Major maintenance costs for SCE's facilities and equipment are expensed as incurred. --- ## Modified: Variable Interest in VIEs that are Consolidated **Key changes:** - Reworded sentence: "SCE Recovery Funding LLC is a bankruptcy remote, wholly owned special purpose subsidiary of SCE, formed for the purpose of issuing securitized bonds." - Reworded sentence: "SCE Recovery Funding LLC has issued a total of $3.2 billion of securitized bonds at December 31, 2025." - Reworded sentence: "December 31,(in millions)20252024Other current assets$49 $49 Regulatory assets: non-current3,092 1,512 Regulatory liabilities: current12 30 Current portion of long-term debt178 49 Other current liabilities14 6 Long-term debt13,022 1,468 Current portion of long-term debt1 Long-term debt1 1The bondholders have no recourse to SCE." **Prior (2025):** SCE Recovery Funding LLC is a bankruptcy remote, wholly owned special purpose subsidiary of SCE, formed for the purpose of issuing securitized bonds related to SCE's AB 1054 Excluded Capital Expenditures. This entity is a VIE because its equity investment is insufficient to support its operations. The most significant activity of SCE Recovery Funding LLC is to service the securitized bonds according to the decisions made by SCE. Therefore, SCE is determined to be the primary beneficiary and consolidates SCE Recovery Funding LLC. SCE Recovery Funding LLC issued a total of $1.6 billion of securitized bonds. The proceeds were used to acquire SCE's right, title and interest in and to non-bypassable rates and other charges to be collected from certain existing and future customers in SCE's service area ("Recovery Property"), associated with the AB 1054 Excluded Capital Expenditures, until the bonds are paid in full, and all financing costs have been recovered. The securitized bonds are secured by the Recovery Property and cash collections from the non-bypassable rates and other charges are the sole source of funds to satisfy the debt obligation. The bondholders have no recourse to SCE. For further details, see Note 5. The following table summarizes the impact of SCE Recovery Funding LLC on SCE's and Edison International's consolidated balance sheets. December 31,(in millions)20242023Other current assets$49 $53 Regulatory assets: non-current1,512 1,558 Regulatory liabilities: current30 34 Current portion of long-term debt149 47 Other current liabilities6 6 Long-term debt11,468 1,515 Current portion of long-term debt1 Long-term debt1 72 72 72 Table of Contents Table of Contents 1The bondholders have no recourse to SCE. The long-term debt balance is net of unamortized debt issuance costs. **Current (2026):** SCE Recovery Funding LLC is a bankruptcy remote, wholly owned special purpose subsidiary of SCE, formed for the purpose of issuing securitized bonds. This entity is a VIE because its equity investment is insufficient to support its operations. The most significant activity of SCE Recovery Funding LLC is to service the securitized bonds according to the decisions made by SCE. Therefore, SCE is determined to be the primary beneficiary and consolidates SCE Recovery Funding LLC. SCE Recovery Funding LLC has issued a total of $3.2 billion of securitized bonds at December 31, 2025. The proceeds were used to acquire SCE's right, title and interest in and to non-bypassable rates and other charges to be collected from certain existing and future customers in SCE's service area ("Recovery Property"), associated with the AB 1054 Excluded Capital Expenditures and costs approved for recovery under the TKM Settlement Agreement, until the bonds are paid in full, and all financing costs have been recovered. The securitized bonds are secured by the Recovery Property and cash collections from the non-bypassable rates and other charges are the sole source of funds to satisfy the debt obligation. The bondholders have no recourse to SCE. For further details, see Note 5. The following table summarizes the impact of SCE Recovery Funding LLC on SCE's and Edison International's consolidated balance sheets. December 31,(in millions)20252024Other current assets$49 $49 Regulatory assets: non-current3,092 1,512 Regulatory liabilities: current12 30 Current portion of long-term debt178 49 Other current liabilities14 6 Long-term debt13,022 1,468 Current portion of long-term debt1 Long-term debt1 1The bondholders have no recourse to SCE. The long-term debt balance is net of unamortized debt issuance costs. --- ## Modified: Uncommitted Letters of Credit **Key changes:** - Reworded sentence: "SCE has agreements with certain lenders for bilateral unsecured standby letters of credit ("SBLC") with a total capacity of $660 million that is uncommitted and supported by reimbursement agreements." - Reworded sentence: "At December 31, 2025, SCE had $147 million in standby letters of credit outstanding under these agreements, which expire between January 2026 and January 2027." **Prior (2025):** SCE has agreements with certain lenders for bilateral unsecured standby letters of credit ("SBLC") with a total capacity of $625 million that is uncommitted and supported by reimbursement agreements. The SBLCs are not subject to any collateral or security requirements. At December 31, 2024, SCE had $118 million in standby letters of credit outstanding under these agreements, which expire between January and December 2025. The unused capacity under these agreements was $507 million. **Current (2026):** SCE has agreements with certain lenders for bilateral unsecured standby letters of credit ("SBLC") with a total capacity of $660 million that is uncommitted and supported by reimbursement agreements. The SBLCs are not subject to any collateral or security requirements. At December 31, 2025, SCE had $147 million in standby letters of credit outstanding under these agreements, which expire between January 2026 and January 2027. --- ## Modified: Net Operating Loss and Tax Credit Carryforwards **Key changes:** - Reworded sentence: "The amounts of net operating loss and tax credit carryforwards (after-tax) are as follows: Edison InternationalSCEDecember 31, 2025(in millions)LossCarryforwardsCreditCarryforwardsLossCarryforwardsCreditCarryforwardsExpire between 2027 to 2030$10 $96 $ - $ - Expire between 2031 to 20451,527 381 725 32 No expiration date11,623 13 1,269 2 Total$3,160 $490 $1,994 $34 No expiration date1 1Under the Tax Cut and Jobs Act signed into law on December 22, 2017 ("Tax Reform"), net operating losses generated after December 31, 2017 can carryforward indefinitely." - Added sentence: "81 81 81 Table of Contents Table of Contents" **Prior (2025):** The amounts of net operating loss and tax credit carryforwards (after-tax) are as follows: Edison InternationalSCEDecember 31, 2024(in millions)LossCarryforwardsCreditCarryforwardsLossCarryforwardsCreditCarryforwardsExpire in 2025$7 $ - $7 $ - Expire between 2026 to 202928 - 12 - Expire between 2030 to 20441,719 699 786 290 No expiration date11,623 24 1,448 26 Total$3,377 $723 $2,253 $316 No expiration date1 1Under the Tax Cut and Jobs Act signed into law on December 22, 2017 ("Tax Reform"), net operating losses generated after December 31, 2017 can carryforward indefinitely. Edison International consolidates for federal income tax purposes, but not for financial accounting purposes, a group of wind projects referred to as Capistrano Wind. The amount of net operating loss and tax credit carryforwards recognized as part of deferred income taxes includes $107 million and $106 million related to Capistrano Wind for 2024 and 2023, respectively. The tax attributes not utilized as of December 31, 2024 will be available for the Edison International consolidated group to utilize in the future. When the remaining Capistrano tax attributes are used in the future by Edison International, payments will be made to those entities under a tax allocation agreement. Under the tax allocation agreement, Edison International has recorded a corresponding liability as part of other long-term liabilities related to its obligation to make payments to Capistrano Wind when these tax benefits are realized. **Current (2026):** The amounts of net operating loss and tax credit carryforwards (after-tax) are as follows: Edison InternationalSCEDecember 31, 2025(in millions)LossCarryforwardsCreditCarryforwardsLossCarryforwardsCreditCarryforwardsExpire between 2027 to 2030$10 $96 $ - $ - Expire between 2031 to 20451,527 381 725 32 No expiration date11,623 13 1,269 2 Total$3,160 $490 $1,994 $34 No expiration date1 1Under the Tax Cut and Jobs Act signed into law on December 22, 2017 ("Tax Reform"), net operating losses generated after December 31, 2017 can carryforward indefinitely. Edison International consolidates for federal income tax purposes, but not for financial accounting purposes, a group of wind projects referred to as "Capistrano Wind." The amount of net operating loss and tax credit carryforwards recognized as part of deferred income taxes includes $106 million and $107 million related to Capistrano Wind for 2025 and 2024, respectively. The tax attributes not utilized as of December 31, 2025 will be available for the Edison International consolidated group to utilize in the future. When the remaining Capistrano tax attributes are used in the future by Edison International, payments will be made to those entities under a tax allocation agreement. Under the tax allocation agreement, Edison International has recorded a corresponding liability as part of other long-term liabilities related to its obligation to make payments to Capistrano Wind when these tax benefits are realized. 81 81 81 Table of Contents Table of Contents --- ## Modified: Consolidated Statements of Changes in EquitySouthern California Edison Company **Key changes:** - Reworded sentence: "Preference CommonAdditionalPaid-inCapitalAccumulatedOtherComprehensiveLossRetainedEarningsTotalEquity(in millions, except per share amounts)StockStockBalance at December 31, 2022$1,945 $2,168 $8,441 $(8)$8,243 $20,789 Net income - - - - 1,597 1,597 Other comprehensive income - - - (4) - (4)Dividends declared on common stock ($3.2422 per share) - - - - (1,410)(1,410)Dividends declared on preference stock ($96.8230 - $143.75 per share) - - - - (123)(123)Stock-based compensation - - (13) - - (13)Noncash stock-based compensation - - 26 - - 26 Preference stock issued550 - (8) - - 542 Balance at December 31, 2023$2,495 $2,168 $8,446 $(12)$8,307 $21,404 Net income - - - - 1,794 1,794 Other comprehensive income - - - 3 - 3 Capital contribution from Edison International - - 500 - - 500 Dividends declared on common stock ($3.4722 per share) - - - - (1,510)(1,510)Dividends declared on preference stock ($24.418 - $199.479 per share) - - - - (154)(154)Stock-based compensation - - (35) - - (35)Noncash stock-based compensation - - 32 - - 32 Preference stock issued350 - (5) - - 345Preference stock redeemed(625) - 12 - (15)(628)Balance at December 31, 2024$2,220 $2,168 $8,950 $(9)$8,422 $21,751 Net income - - - - 5,033 5,033 Other comprehensive income - - - (3) - (3)Dividends declared on common stock ($5.1048 per share) - - - - (2,220)(2,220)Dividends declared on preference stock ($125.00 - $187.50 per share) - - - - (136)(136)Stock-based compensation - - (21) - - (21)Noncash stock-based compensation - - 30 - - 30 Preference stock redeemed and repurchased(506) - 11 - (9)(504)Balance at December 31, 2025$1,714 $2,168 $8,970 $(12)$11,090 $23,930 Preference Common Stock Stock Dividends declared on common stock ($3.2422 per share) Dividends declared on preference stock ($96.8230 - $143.75 per share) Preference stock issued Dividends declared on common stock ($3.4722 per share) Dividends declared on preference stock ($24.418 - $199.479 per share) Preference stock redeemed Dividends declared on common stock ($5.1048 per share) Dividends declared on preference stock ($125.00 - $187.50 per share) The accompanying notes are an integral part of these consolidated financial statements." **Prior (2025):** (in millions, except per share amounts)PreferenceStockCommonStockAdditionalPaid-inCapitalAccumulatedOtherComprehensiveLossRetainedEarningsTotalEquityBalance at December 31, 2021$1,945 $2,168 $7,033 $(32)$8,721 $19,835 Net income - - - - 954 954 Other comprehensive income - - - 24 - 24 Capital contribution from Edison International Parent - - 1,400 - - 1,400 Dividends declared on common stock ($3.0468 per share) - - - - (1,325)(1,325)Dividends declared on preference stock ($65.1098 - $143.75 per share) - - - - (107)(107)Stock-based compensation - - (14) - - (14)Noncash stock-based compensation - - 22 - - 22 Balance at December 31, 2022$1,945 $2,168 $8,441 $(8)$8,243 $20,789 Net income - - - - 1,597 1,597 Other comprehensive income - - - (4) - (4)Dividends declared on common stock ($3.2422 per share) - - - - (1,410)(1,410)Dividends declared on preference stock ($96.823 - $143.75 per share) - - - - (123)(123)Stock-based compensation - - (13) - - (13)Noncash stock-based compensation - - 26 - - 26 Preference stock issued550 - (8) - - 542Balance at December 31, 2023$2,495 $2,168 $8,446 $(12)$8,307 $21,404 Net income - - - - 1,794 1,794 Other comprehensive income - - - 3 - 3 Capital contribution from Edison International Parent - - 500 - - 500 Dividends declared on common stock ($3.4722 per share) - - - - (1,510)(1,510)Dividends declared on preference stock ($24.418 - $199.479 per share) - - - - (154)(154)Stock-based compensation - - (35) - - (35)Noncash stock-based compensation - - 32 - - 32 Preference stock issued350 - (5) - - 345 Preference stock redeemed(625) - 12 - (15)(628)Balance at December 31, 2024$2,220 $2,168 $8,950 $(9)$8,422 $21,751 Dividends declared on common stock ($3.0468 per share) Dividends declared on preference stock ($65.1098 - $143.75 per share) Dividends declared on common stock ($3.2422 per share) Dividends declared on preference stock ($96.823 - $143.75 per share) Dividends declared on common stock ($3.4722 per share) Dividends declared on preference stock ($24.418 - $199.479 per share) The accompanying notes are an integral part of these consolidated financial statements. 60 60 60 Table of Contents Table of Contents **Current (2026):** Preference CommonAdditionalPaid-inCapitalAccumulatedOtherComprehensiveLossRetainedEarningsTotalEquity(in millions, except per share amounts)StockStockBalance at December 31, 2022$1,945 $2,168 $8,441 $(8)$8,243 $20,789 Net income - - - - 1,597 1,597 Other comprehensive income - - - (4) - (4)Dividends declared on common stock ($3.2422 per share) - - - - (1,410)(1,410)Dividends declared on preference stock ($96.8230 - $143.75 per share) - - - - (123)(123)Stock-based compensation - - (13) - - (13)Noncash stock-based compensation - - 26 - - 26 Preference stock issued550 - (8) - - 542 Balance at December 31, 2023$2,495 $2,168 $8,446 $(12)$8,307 $21,404 Net income - - - - 1,794 1,794 Other comprehensive income - - - 3 - 3 Capital contribution from Edison International - - 500 - - 500 Dividends declared on common stock ($3.4722 per share) - - - - (1,510)(1,510)Dividends declared on preference stock ($24.418 - $199.479 per share) - - - - (154)(154)Stock-based compensation - - (35) - - (35)Noncash stock-based compensation - - 32 - - 32 Preference stock issued350 - (5) - - 345Preference stock redeemed(625) - 12 - (15)(628)Balance at December 31, 2024$2,220 $2,168 $8,950 $(9)$8,422 $21,751 Net income - - - - 5,033 5,033 Other comprehensive income - - - (3) - (3)Dividends declared on common stock ($5.1048 per share) - - - - (2,220)(2,220)Dividends declared on preference stock ($125.00 - $187.50 per share) - - - - (136)(136)Stock-based compensation - - (21) - - (21)Noncash stock-based compensation - - 30 - - 30 Preference stock redeemed and repurchased(506) - 11 - (9)(504)Balance at December 31, 2025$1,714 $2,168 $8,970 $(12)$11,090 $23,930 Preference Common Stock Stock Dividends declared on common stock ($3.2422 per share) Dividends declared on preference stock ($96.8230 - $143.75 per share) Preference stock issued Dividends declared on common stock ($3.4722 per share) Dividends declared on preference stock ($24.418 - $199.479 per share) Preference stock redeemed Dividends declared on common stock ($5.1048 per share) Dividends declared on preference stock ($125.00 - $187.50 per share) The accompanying notes are an integral part of these consolidated financial statements. 59 59 59 Table of Contents Table of Contents --- ## Modified: Deferred Revenue **Key changes:** - Reworded sentence: "As of December 31, 2025, SCE has deferred revenue of $341 million related to the sale of the use of transfer capability of West of Devers transmission line, of which $13 million and $328 million are included in "Other current liabilities" and "Other deferred credits and other long-term liabilities," respectively, on SCE's consolidated balance sheets." - Added sentence: "79 79 79 Table of Contents Table of Contents" **Prior (2025):** As of December 31, 2024, SCE has deferred revenue of $354 million related to the sale of the use of transfer capability of West of Devers transmission line, of which $13 million and $341 million are included in "Other current liabilities" and "Other deferred credits and other long-term liabilities," respectively, on SCE's consolidated balance sheets. The deferred revenue is amortized straight-line over a period of 30 years starting 2021. **Current (2026):** As of December 31, 2025, SCE has deferred revenue of $341 million related to the sale of the use of transfer capability of West of Devers transmission line, of which $13 million and $328 million are included in "Other current liabilities" and "Other deferred credits and other long-term liabilities," respectively, on SCE's consolidated balance sheets. The deferred revenue is amortized straight-line over a period of 30 years starting 2021. 79 79 79 Table of Contents Table of Contents --- ## Modified: Edison International Dividend **Key changes:** - Reworded sentence: "In December 2025, Edison International declared a 6.0% increase to the annual dividend rate from $3.31 per share to $3.51 per share." **Prior (2025):** Edison International's ability to declare and pay common dividends may be restricted under the terms of its outstanding preferred stock. For further information see Note 14. In December 2024, Edison International declared a 6.1% increase to the annual dividend rate from $3.12 per share to $3.31 per share. On February 27, 2025, Edison International declared a dividend of $0.8275 per share to be paid on April 30, 2025. Edison International intends to maintain its target payout ratio of 45% - 55% of SCE's core earnings. **Current (2026):** Edison International's ability to declare and pay common dividends may be restricted under the terms of its outstanding preferred stock. For further information see Note 14. In December 2025, Edison International declared a 6.0% increase to the annual dividend rate from $3.31 per share to $3.51 per share. On February 18, 2026, Edison International declared a dividend of $0.8775 per share to be paid on April 30, 2026. Edison International intends to maintain its target payout ratio of 45% - 55% of SCE's core earnings. --- ## Modified: Tax Disputes **Key changes:** - Reworded sentence: "Tax years that remain open for examination by the Internal Revenue Service and Franchise Tax Board are 2022 - 2024 and 2013 - 2018 & 2021 - 2024, respectively." **Prior (2025):** Tax years that remain open for examination by the Internal Revenue Service and Franchise Tax Board are 2021 - 2023 and 2013 - 2018 & 2020 - 2023, respectively. **Current (2026):** Tax years that remain open for examination by the Internal Revenue Service and Franchise Tax Board are 2022 - 2024 and 2013 - 2018 & 2021 - 2024, respectively. --- ## Modified: Pension Plans and Postretirement Benefits Other Than Pensions **Key changes:** - Reworded sentence: "Employees hired by the participating companies on or after December 31, 2017 are no longer eligible to participate in the pension plans." - Reworded sentence: "The expected contributions (all by the employer) for Edison International and SCE are approximately $50 million and $21 million, respectively, for the year ending December 31, 2026." - Reworded sentence: "84 84 84 Table of Contents Table of Contents Information on pension plan assets and benefit obligations is shown below." - Reworded sentence: "There are no expected contributions for PBOP benefits for the year ended December 31, 2026." - Reworded sentence: "87 87 87 Table of Contents Table of Contents Information on PBOP Plan assets and benefit obligations is shown below: Edison InternationalSCEYears ended December 31,(in millions)2025202420252024Change in benefit obligationBenefit obligation at beginning of year$741 $773 $737 $769 Service cost13 14 13 14 Interest cost40 38 40 38 Change in plan provisions - 23 - 23 Actuarial loss (gain)3 (34)3 (34)Plan participants' contributions26 26 26 26 Benefits paid(74)(99)(74)(99)Benefit obligation at end of year$749 $741 $745 $737 Change in plan assetsFair value of plan assets at beginning of year$2,281 $2,275 $2,281 $2,275 Actual return on assets177 78 177 78 Employer (withdrawals) contributions(11)1 (11)1 Plan participants' contributions27 26 27 26 Benefits paid(74)(99)(74)(99)Fair value of plan assets at end of year2,400 2,281 2,400 2,281 Overfunded status at end of year$1,651 $1,540 $1,655 $1,544 Amounts recognized in the consolidated balance sheets consist of:Long-term assets$1,655 $1,544 $1,655 $1,544 Current liabilities - (1) - - Long-term liabilities(4)(3) - - $1,651 $1,540 $1,655 $1,544 Amounts recognized in accumulated other comprehensive loss (income) consist of:Net gain$(4)$(4)$ - $ - Amounts recognized as a regulatory liability(1,655)(1,544)(1,655)(1,544)Weighted average assumptions used to determine obligations at end of year:Discount rate5.40 %5.60 %5.40 %5.60 %Assumed health care cost trend rates:Rate assumed for following year6.50 %6.25 %6.50 %6.25 %Ultimate rate5.00 %5.00 %5.00 %5.00 %Year ultimate rate reached2031202920312029 For both Edison International and SCE, the 2025 actuarial loss was primarily related to a $16 million loss from the change in discount rate, partially offset by a $12 million gain from change in demographic assumptions." **Prior (2025):** Pension Plans Noncontributory defined benefit pension plans (some with cash balance features) cover most employees meeting minimum service requirements. Employees hired by the participating companies on or after December 31, 2017 are no longer eligible to participate in the pension plan. In lieu of that, an additional non-contributory employer contribution is deposited into the Edison 401(k) Savings Plan. SCE recognizes pension expense for its nonexecutive plan as calculated by the actuarial method used for ratemaking. The expected contributions (all by the employer) for Edison International and SCE are approximately $44 million and $15 million, respectively, for the year ending December 31, 2025. The majority of annual contributions made by SCE to its pension plans are anticipated to be recovered through CPUC-approved regulatory mechanisms. The funded position of Edison International's pension is sensitive to changes in market conditions. Changes in overall interest rate levels significantly affect the company's liabilities, while assets held in the various trusts established to fund Edison International's pension are affected by movements in the equity and bond markets. Due to SCE's regulatory recovery treatment, unrealized losses equal to the unfunded status are recorded to a regulatory asset and unrealized gains equal to the funded status are recorded to a regulatory liability. See Note 11 for further information. 83 83 83 Table of Contents Table of Contents Information on pension plan assets and benefit obligations is shown below. Edison InternationalSCEYears ended December 31,(in millions)2024202320242023Change in projected benefit obligationProjected benefit obligation at beginning of year$3,647 $3,524 $3,278 $3,159 Service cost103 101 99 97 Interest cost175 180 157 162 Actuarial (gain) loss(59)96 (47)82 Benefits paid(230)(254)(198)(222)Projected benefit obligation at end of year$3,636 $3,647 $3,289 $3,278 Change in plan assetsFair value of plan assets at beginning of year$3,609 $3,462 $3,415 $3,275 Actual return on plan assets192 369 182 349 Employer contributions37 32 17 13 Benefits paid(230)(254)(198)(222)Fair value of plan assets at end of year3,608 3,609 3,416 3,415 (Underfunded)/Overfunded status at end of year$(28)$(38)$127 $137 Amounts recognized in the consolidated balance sheets consist of 1:Long-term assets$166 $169 $137 $149 Current liabilities(27)(30)(1)(2)Long-term liabilities(167)(177)(9)(10)$(28)$(38)$127 $137 Amounts recognized in accumulated other comprehensive loss consist of:Net loss$8 $21 $13 $8 Amounts recognized as a regulatory liability(146)(159)(133)(159)Accumulated benefit obligation at end of year$3,508 $3,495 $3,172 $3,136 Pension plans with plan assets in excess of an accumulated benefit obligation:Projected benefit obligation3,636 3,647 3,289 3,278 Accumulated benefit obligation3,508 3,495 3,172 3,136 Fair value of plan assets3,608 3,609 3,416 3,415 Weighted average assumptions used to determine obligations at end of year:Discount rate5.56%5.04%5.56%5.04%Rate of compensation increase4.00%4.00%4.00%4.00% Amounts recognized in the consolidated balance sheets consist of 1: Net loss 1The SCE liability excludes a long-term payable due to Edison International Parent of $88 million and $94 million at December 31, 2024 and 2023, respectively, related to certain SCE postretirement benefit obligations transferred to Edison International Parent. 1 For Edison International and SCE, respectively, the 2024 actuarial gains are primarily related to $159 million and $146 million from an increase of 52 basis points in the discount rate (from 5.04% as of December 31, 2023 to 5.56% as of December 31, 2024). For Edison International and SCE, respectively, the 2023 actuarial losses are primarily related to $96 million and $92 million in losses from a decrease of 32 basis points in the discount rate (from 5.36% as of December 31, 2022 to 5.04% as of December 31, 2023). 84 84 84 Table of Contents Table of Contents Net periodic pension expense components are: Edison InternationalSCEYears ended December 31,(in millions)202420232022202420232022Service cost$103 $101 $120 $101 $99 $118 Non-service cost (benefit)Interest cost175 180 111 162 166 101 Expected return on plan assets(232)(214)(227)(219)(202)(215)Settlement costs - - 4 - - 4 Amortization of prior service cost - - - - - - Amortization of net loss4 3 5 2 2 2 Regulatory adjustment(23)(47)6 (22)(47)6 Total non-service benefit1(76)(78)(101)(77)(81)(102)Total expense$27 $23 $19 $24 $18 $16 Total non-service benefit1 1Included in "Other income" on Edison International's and SCE's consolidated income statements. For further details, see Note 16. Other changes in pension plan assets and benefit obligations recognized in other comprehensive income: Edison InternationalSCEYears ended December 31,(in millions)202420232022202420232022Net (gain) loss$(9)$6 $(45)$(2)$6 $(24)Settlement charges - - (4) - - (4)Amortization of net gain(4)(2)(8)(2)(2)(5)Total (gain) loss recognized in other comprehensive income(13)4 (57)(4)4 (33)Total recognized in expense and other comprehensive income$14 $27 $(38)$20 $22 $(17) In accordance with authoritative guidance on rate-regulated enterprises, SCE records amortization of net gains and losses into regulatory assets and liabilities instead of charges and credits to other comprehensive income for the portion of SCE's postretirement benefit plans that are recoverable in utility rates. Edison International and SCE used the following weighted average assumptions to determine pension expense: Years ended December 31,202420232022Discount rate5.04 %5.36 %2.75 %Rate of compensation increase4.00 %4.00 %4.00 %Expected long-term return on plan assets6.75 %6.50 %5.50 %Interest crediting rate for cash balance account1:Starting rate5.54 %5.86 %3.12 %Ultimate rate5.54 %5.86 %4.50 %Year ultimate rate is reached202420232026 Interest crediting rate for cash balance account1: 1Edison International and SCE were using a graduated assumption for interest crediting rate for cash balance account, where current interest rate gradually increased to an ultimate rate at a certain year. Starting 2023, Edison International and SCE changed to use single interest crediting rate assumption to determine the pension expense for cash balance account. 85 85 85 Table of Contents Table of Contents The following benefit payments, which reflect service rendered and expected future service, are expected to be paid: (in millions)EdisonInternationalSCE2025$332$29120263443012027338304202833229920293242942030 - 20341,4961,370 PBOP(s) Employees hired prior to December 31, 2017 who retire at or after age 55 with at least 10 years of service may be eligible for postretirement healthcare benefits. Eligibility for a company contribution toward the cost of these benefits in retirement depends on a number of factors, including the employee's years of service, age, hire date, and retirement date. Employees hired on or after December 31, 2017 are no longer eligible for retiree healthcare benefits. In lieu of those benefits, Edison International will provide a health reimbursement account of $200 per month available only after meeting certain age and service year requirements. Under the terms of the Edison International Welfare Benefit Plan ("PBOP Plan"), each participating employer (Edison International or its participating subsidiaries) is responsible for the costs and expenses of PBOP Plan benefits with respect to its employees and former employees that exceed the participants' share of contributions. A participating employer may terminate the PBOP Plan benefits with respect to its employees and former employees, as may SCE (as PBOP Plan sponsor), and, accordingly, the participants' PBOP Plan benefits are not vested benefits. There are no expected contributions for PBOP benefits for the year ended December 31, 2025. Annual contributions related to SCE employees made to SCE plans are anticipated to be recovered through CPUC-approved regulatory mechanisms and are expected to be, at a minimum, equal to the total annual expense for these plans. SCE has three voluntary employees' beneficiary association trusts ("VEBA Trusts") that can only be used to pay for retiree health care benefits of SCE and its subsidiaries. Once funded into the VEBA Trusts, neither SCE nor Edison International can subsequently recover the remaining amounts in the VEBA Trusts. Participants of the PBOP Plan do not have a beneficial interest in the VEBA Trusts. The VEBA Trust assets are sensitive to changes in market conditions. Changes in overall interest rate levels significantly affect the company's liabilities, while assets held in the various trusts established to fund Edison International's other postretirement benefits are affected by movements in the equity and bond markets. Due to SCE's regulatory recovery treatment, the funded status is offset by a regulatory liability. 86 86 86 Table of Contents Table of Contents Information on PBOP Plan assets and benefit obligations is shown below: Edison InternationalSCEYears ended December 31,(in millions)2024202320242023Change in benefit obligationBenefit obligation at beginning of year$773 $1,331 $769 $1,323 Service cost14 20 14 20 Interest cost38 67 38 67 Change in plan provisions23 - 23 - Actuarial gain(34)(567)(34)(563)Plan participants' contributions26 28 26 28 Benefits paid(99)(106)(99)(106)Benefit obligation at end of year$741 $773 $737 $769 Change in plan assetsFair value of plan assets at beginning of year$2,275 $2,187 $2,275 $2,187 Actual return on assets78 162 78 162 Employer contributions1 4 1 4 Plan participants' contributions26 28 26 28 Benefits paid(99)(106)(99)(106)Fair value of plan assets at end of year2,281 2,275 2,281 2,275 Overfunded status at end of year$1,540 $1,502 $1,544 $1,506 Amounts recognized in the consolidated balance sheets consist of:Long-term assets$1,544 $1,506 $1,544 $1,506 Current liabilities(1) - - - Long-term liabilities(3)(4) - - $1,540 $1,502 $1,544 $1,506 Amounts recognized in accumulated other comprehensive loss consist of:Net gain$(4)$(5)$ - $ - Amounts recognized as a regulatory liability(1,544)(1,505)(1,544)(1,505)Weighted average assumptions used to determine obligations at end of year:Discount rate5.60 %5.06 %5.60 %5.06 %Assumed health care cost trend rates:Rate assumed for following year6.25 %6.50 %6.25 %6.50 %Ultimate rate5.00 %5.00 %5.00 %5.00 %Year ultimate rate reached2029202920292029 For both Edison International and SCE, the 2024 actuarial gains are primarily related to $41 million in gains from the change in discount rate. For Edison International and SCE, the 2023 actuarial gains are primarily related to $553 million and $550 million in gains from the change in postretirement medical carrier and retiree medical delivery mechanism effective in 2024, respectively. 87 87 87 Table of Contents Table of Contents Net periodic PBOP expense components are: Edison InternationalSCEYears ended December 31,(in millions)202420232022202420232022Service cost$14 $20 $34 $14 $20 $34 Non-service cost (benefit)Interest cost38 67 56 38 67 55 Expected return on plan assets(113)(107)(97)(113)(107)(97)Amortization of prior service cost(1)(1)(2)(1)(1)(2)Amortization of net gain(95)(50)(45)(95)(50)(45)Regulatory adjustment157 71 55 157 71 55 Total non-service benefit1(14)(20)(33)(14)(20)(34)Total expense$ - $ - $1 $ - $ - $ - Total non-service benefit1 1Included in "Other income" on Edison International's and SCE's consolidated income statements. For further details, see Note 16. In accordance with authoritative guidance on rate-regulated enterprises, SCE records amortization of net gains and losses to regulatory assets and liabilities instead of charges and credits to other comprehensive income (loss) for the portion of SCE's postretirement benefit plans that are recoverable in utility rates. Edison International and SCE used the following weighted average assumptions to determine PBOP expense: Years ended December 31,202420232022Discount rate5.06%5.43%2.95%Expected long-term return on plan assets4.88%5.00%3.50%Assumed health care cost trend rates:Current year6.50%6.75%6.25%Ultimate rate5.00%5.00%5.00%Year ultimate rate reached202920292029 The following benefit payments (net of plan participants' contributions) are expected to be paid: (in millions)EdisonInternationalSCE2025$49 $48 202650 50 202754 54 202855 54 202955 55 2030 - 2034282 281 **Current (2026):** Pension Plans Noncontributory defined benefit pension plans (some with cash balance features) cover most employees meeting minimum service requirements. Employees hired by the participating companies on or after December 31, 2017 are no longer eligible to participate in the pension plans. In lieu of that, additional non-contributory employer contributions are deposited into the Edison 401(k) Savings Plan. SCE recognizes pension expense for its nonexecutive plan as calculated by the actuarial method used for ratemaking. The expected contributions (all by the employer) for Edison International and SCE are approximately $50 million and $21 million, respectively, for the year ending December 31, 2026. The majority of annual contributions made by SCE to its pension plans are anticipated to be recovered through CPUC-approved regulatory mechanisms. The funded position of Edison International's pension is sensitive to changes in market conditions. Changes in overall interest rate levels significantly affect the company's liabilities, while assets held in the various trusts established to fund Edison International's pension are affected by movements in the equity and bond markets. Due to SCE's regulatory recovery treatment, unrealized losses equal to the unfunded status are recorded to a regulatory asset and unrealized gains equal to the funded status are recorded to a regulatory liability. See Note 11 for further information. 84 84 84 Table of Contents Table of Contents Information on pension plan assets and benefit obligations is shown below. Edison InternationalSCEYears ended December 31,(in millions)2025202420252024Change in projected benefit obligationProjected benefit obligation at beginning of year$3,636 $3,647 $3,289 $3,278 Service cost94 103 90 99 Interest cost193 175 174 157 Actuarial loss (gain)97 (59)94 (47)Benefits paid(315)(230)(285)(198)Projected benefit obligation at end of year$3,705 $3,636 $3,362 $3,289 Change in plan assetsFair value of plan assets at beginning of year$3,608 $3,609 $3,416 $3,415 Actual return on plan assets389 192 368 182 Employer contributions38 37 21 17 Benefits paid(315)(230)(285)(198)Fair value of plan assets at end of year3,720 3,608 3,520 3,416 Overfunded/(Underfunded) status at end of year$15 $(28)$158 $127 Amounts recognized in the consolidated balance sheets consist of 1:Long-term assets$207 $166 $168 $137 Current liabilities(28)(27)(1)(1)Long-term liabilities(164)(167)(9)(9)$15 $(28)$158 $127 Amounts recognized in accumulated other comprehensive loss (income) consist of:Net loss$2 $8 $17 $13 Amounts recognized as a regulatory liability(175)(146)(158)(133)Accumulated benefit obligation at end of year$3,502 $3,508 $3,171 $3,172 Pension plans with plan assets in excess of an accumulated benefit obligation:Projected benefit obligation3,705 3,636 3,362 3,289 Accumulated benefit obligation3,502 3,508 3,171 3,172 Fair value of plan assets3,720 3,608 3,520 3,416 Weighted average assumptions used to determine obligations at end of year:Discount rate5.44%5.56%5.44%5.56%Rate of compensation increase4.00%4.00%4.00%4.00% Amounts recognized in the consolidated balance sheets consist of 1: Net loss 1The SCE liability excludes a long-term payable due to Edison International Parent of $89 million and $88 million at December 31, 2025 and 2024, respectively, related to certain SCE postretirement benefit obligations transferred to Edison International Parent. 1 For Edison International and SCE, respectively, the 2025 actuarial loss are primarily related to $46 million and $43 million from a decrease of 12 basis points in the discount rate (from 5.56% as of December 31, 2024 to 5.44% as of December 31, 2025) and change in other actuarial assumptions. For Edison International and SCE, respectively, the 2024 actuarial gain are primarily related to $159 million and $146 million from an increase of 52 basis points in the discount rate (from 5.04% as of December 31, 2023 to 5.56% as of December 31, 2024). 85 85 85 Table of Contents Table of Contents Net periodic pension expense components are: Edison InternationalSCEYears ended December 31,(in millions)202520242023202520242023Service cost$94 $103 $101 $91 $101 $99 Non-service cost (benefit)Interest cost193 175 180 179 162 166 Expected return on plan assets(234)(232)(214)(221)(219)(202)Amortization of net loss2 4 3 1 2 2 Regulatory adjustment(25)(23)(47)(24)(22)(47)Total non-service benefit1 (64)(76)(78)(65)(77)(81)Total expense$30 $27 $23 $26 $24 $18 Total non-service benefit1 1Included in "Other income" on Edison International's and SCE's consolidated income statements. For further details, see Note 15. Other changes in pension plan assets and benefit obligations recognized in other comprehensive income: Edison InternationalSCEYears ended December 31,(in millions)202520242023202520242023Net (gain) loss$(4)$(9)$6 $5 $(2)$6 Amortization of net gain(2)(4)(2)(1)(2)(2)Total (gain) loss recognized in other comprehensive income(6)(13)4 4 (4)4 Total recognized in expense and other comprehensive income$24 $14 $27 $30 $20 $22 In accordance with authoritative guidance on rate-regulated enterprises, SCE records amortization of net gains and losses into regulatory assets and liabilities instead of charges and credits to other comprehensive income for the portion of SCE's postretirement benefit plans that are recoverable in utility rates. Edison International and SCE used the following weighted average assumptions to determine pension expense: Years ended December 31,202520242023Discount rate5.56 %5.04 %5.36 %Rate of compensation increase4.00 %4.00 %4.00 %Expected long-term return on plan assets6.75 %6.75 %6.50 %Interest crediting rate for cash balance account6.06 %5.54 %5.86 % Interest crediting rate for cash balance account The following benefit payments, which reflect service rendered and expected future service, are expected to be paid: (in millions)EdisonInternationalSCE2026$263$22420272622292028270238202927124020302812502031 - 20351,3971,268 86 86 86 Table of Contents Table of Contents PBOP(s) Employees hired prior to December 31, 2017 who retire at or after age 55 with at least 10 years of service may be eligible for postretirement healthcare benefits. Eligibility for a company contribution toward the cost of these benefits in retirement depends on a number of factors, including the employee's years of service, age, hire date, and retirement date. Employees hired on or after December 31, 2017 are no longer eligible for retiree healthcare benefits. In lieu of those benefits, Edison International will provide a health reimbursement account of $200 per month available only after meeting certain age and service year requirements. Under the terms of the Edison International Welfare Benefit Plan ("PBOP Plan"), each participating employer (Edison International or its participating subsidiaries) is responsible for the costs and expenses of PBOP Plan benefits with respect to its employees and former employees that exceed the participants' share of contributions. A participating employer may terminate the PBOP Plan benefits with respect to its employees and former employees, as may SCE (as PBOP Plan sponsor), and, accordingly, the participants' PBOP Plan benefits are not vested benefits. There are no expected contributions for PBOP benefits for the year ended December 31, 2026. Annual contributions related to SCE employees made to SCE plans are anticipated to be recovered through CPUC-approved regulatory mechanisms and are expected to be, at a minimum, equal to the total annual expense for these plans. SCE has three voluntary employees' beneficiary association trusts ("VEBA Trusts") that can only be used to pay for retiree health care benefits of SCE and its subsidiaries. Once funded into the VEBA Trusts, neither SCE nor Edison International can subsequently recover the remaining amounts in the VEBA Trusts. Participants of the PBOP Plan do not have a beneficial interest in the VEBA Trusts. The VEBA Trust assets are sensitive to changes in market conditions. Changes in overall interest rate levels significantly affect the company's liabilities, while assets held in the various trusts established to fund Edison International's other postretirement benefits are affected by movements in the equity and bond markets. Due to SCE's regulatory recovery treatment, the funded status is offset by a regulatory liability. 87 87 87 Table of Contents Table of Contents Information on PBOP Plan assets and benefit obligations is shown below: Edison InternationalSCEYears ended December 31,(in millions)2025202420252024Change in benefit obligationBenefit obligation at beginning of year$741 $773 $737 $769 Service cost13 14 13 14 Interest cost40 38 40 38 Change in plan provisions - 23 - 23 Actuarial loss (gain)3 (34)3 (34)Plan participants' contributions26 26 26 26 Benefits paid(74)(99)(74)(99)Benefit obligation at end of year$749 $741 $745 $737 Change in plan assetsFair value of plan assets at beginning of year$2,281 $2,275 $2,281 $2,275 Actual return on assets177 78 177 78 Employer (withdrawals) contributions(11)1 (11)1 Plan participants' contributions27 26 27 26 Benefits paid(74)(99)(74)(99)Fair value of plan assets at end of year2,400 2,281 2,400 2,281 Overfunded status at end of year$1,651 $1,540 $1,655 $1,544 Amounts recognized in the consolidated balance sheets consist of:Long-term assets$1,655 $1,544 $1,655 $1,544 Current liabilities - (1) - - Long-term liabilities(4)(3) - - $1,651 $1,540 $1,655 $1,544 Amounts recognized in accumulated other comprehensive loss (income) consist of:Net gain$(4)$(4)$ - $ - Amounts recognized as a regulatory liability(1,655)(1,544)(1,655)(1,544)Weighted average assumptions used to determine obligations at end of year:Discount rate5.40 %5.60 %5.40 %5.60 %Assumed health care cost trend rates:Rate assumed for following year6.50 %6.25 %6.50 %6.25 %Ultimate rate5.00 %5.00 %5.00 %5.00 %Year ultimate rate reached2031202920312029 For both Edison International and SCE, the 2025 actuarial loss was primarily related to a $16 million loss from the change in discount rate, partially offset by a $12 million gain from change in demographic assumptions. For Edison International and SCE, the 2024 actuarial gains are primarily related to $41 million in gains from the change in discount rate. 88 88 88 Table of Contents Table of Contents Net periodic PBOP expense components are: Edison InternationalSCEYears ended December 31,(in millions)202520242023202520242023Service cost$13 $14 $20 $13 $14 $20 Non-service cost (benefit)Interest cost40 38 67 40 38 67 Expected return on plan assets(107)(113)(107)(107)(113)(107)Amortization of prior service cost1 (1)(1)1 (1)(1)Amortization of net gain(83)(95)(50)(82)(95)(50)Regulatory adjustment124 157 71 124 157 71 Total non-service benefit1(25)(14)(20)(24)(14)(20)Total benefit$(12)$ - $ - $(11)$ - $ - Total non-service benefit1 1Included in "Other income" on Edison International's and SCE's consolidated income statements. For further details, see Note 15. In accordance with authoritative guidance on rate-regulated enterprises, SCE records amortization of net gains and losses to regulatory assets and liabilities instead of charges and credits to other comprehensive income (loss) for the portion of SCE's postretirement benefit plans that are recoverable in utility rates. Edison International and SCE used the following weighted average assumptions to determine PBOP expense: Years ended December 31,202520242023Discount rate5.60%5.06%5.43%Expected long-term return on plan assets4.72%4.88%5.00%Assumed health care cost trend rates:Current year6.50%6.50%6.75%Ultimate rate5.00%5.00%5.00%Year ultimate rate reached203120292029 The following benefit payments (net of plan participants' contributions) are expected to be paid: (in millions)EdisonInternationalSCE2026$47 $47 202751 51 202851 51 202952 51 203052 52 2031 - 2035272 271 --- ## Modified: Fair Value of Debt Recorded at Carrying Value **Key changes:** - Reworded sentence: "The carrying value and fair value of Edison International's and SCE's long-term debt (including current portion of long-term debt) are as follows: December 31, 2025December 31, 2024(in millions)CarryingValue1FairValue2CarryingValue1FairValue2Edison International$37,998 $35,721 $35,583 $33,160 SCE33,183 30,744 30,515 27,994 Carrying Value1 Fair Value2 Carrying Value1 Fair Value2 1Carrying value is net of debt issuance costs." - Added sentence: "75 75 75 Table of Contents Table of Contents" **Prior (2025):** The carrying value and fair value of Edison International's and SCE's long-term debt (including current portion of long-term debt) are as follows: December 31, 2024December 31, 2023(in millions)CarryingValue1FairValue2CarryingValue1FairValue2Edison International$35,583 $33,160 $33,013 $31,315 SCE30,515 27,994 28,494 26,712 Carrying Value1 Fair Value2 Carrying Value1 Fair Value2 1Carrying value is net of debt issuance costs. 2The fair value of long-term debt is classified as Level 2. **Current (2026):** The carrying value and fair value of Edison International's and SCE's long-term debt (including current portion of long-term debt) are as follows: December 31, 2025December 31, 2024(in millions)CarryingValue1FairValue2CarryingValue1FairValue2Edison International$37,998 $35,721 $35,583 $33,160 SCE33,183 30,744 30,515 27,994 Carrying Value1 Fair Value2 Carrying Value1 Fair Value2 1Carrying value is net of debt issuance costs. 2The fair value of long-term debt is classified as Level 2. 75 75 75 Table of Contents Table of Contents --- ## Modified: Capitalized Software Costs **Key changes:** - Reworded sentence: "Capitalized software costs, included in general plant and other above, was $2.7 billion and $2.5 billion at December 31, 2025 and 2024, respectively, and accumulated amortization was $1.3 billion and $1.1 billion, at December 31, 2025 and 2024, respectively." **Prior (2025):** SCE capitalizes costs incurred during the application development stage of internal use software projects to property, plant and equipment. SCE amortizes capitalized software costs ratably over their useful lives, primarily 5 and 7 year lives, commencing upon operational use. Capitalized software costs, included in general plant and other above, was $2.5 billion and $2.1 billion at December 31, 2024 and 2023, respectively, and accumulated amortization was $1.1 billion and $0.9 billion, at December 31, 2024 and 2023, respectively. Amortization expense for capitalized software was $416 million, $358 million, and $344 million in 2024, 2023, and 2022, respectively. At December 31, 2024, amortization expense is estimated to be $428 million, $371 million, $288 million, $186 million, and $72 million for 2025 through 2029, respectively. 71 71 71 Table of Contents Table of Contents **Current (2026):** SCE capitalizes costs incurred during the application development stage of internal use software projects to property, plant and equipment. SCE amortizes capitalized software costs ratably over their useful lives, primarily 5 and 7 year lives, commencing upon operational use. Capitalized software costs, included in general plant and other above, was $2.7 billion and $2.5 billion at December 31, 2025 and 2024, respectively, and accumulated amortization was $1.3 billion and $1.1 billion, at December 31, 2025 and 2024, respectively. Amortization expense for capitalized software was $463 million, $416 million, and $358 million in 2025, 2024, and 2023, respectively. --- ## Modified: Accrued Interest and Penalties **Key changes:** - Reworded sentence: "The total amount of accrued interest and penalties related to unrecognized tax benefits are: Edison InternationalSCEDecember 31,(in millions)2025202420252024Accrued interest and penalties$2 $ - $42 $36 The net after-tax interest and penalties recognized in income tax expense are: Edison InternationalSCEYears ended December 31,(in millions)202520242023202520242023Net after-tax interest and penalties tax expense$2$ - $ - $4$7$4 83 83 83 Table of Contents Table of Contents" **Prior (2025):** The total amount of accrued interest and penalties related to income tax liabilities are: Edison InternationalSCEDecember 31,(in millions)2024202320242023Accrued interest and penalties$ - $ - $36 $28 The net after-tax interest and penalties recognized in income tax (benefit) expense are: Edison InternationalSCEYears ended December 31,(in millions)202420232022202420232022Net after-tax interest and penalties tax expense$ - $ - $ - $7$4$2 82 82 82 Table of Contents Table of Contents **Current (2026):** The total amount of accrued interest and penalties related to unrecognized tax benefits are: Edison InternationalSCEDecember 31,(in millions)2025202420252024Accrued interest and penalties$2 $ - $42 $36 The net after-tax interest and penalties recognized in income tax expense are: Edison InternationalSCEYears ended December 31,(in millions)202520242023202520242023Net after-tax interest and penalties tax expense$2$ - $ - $4$7$4 83 83 83 Table of Contents Table of Contents --- ## Modified: Jointly Owned Utility Projects **Key changes:** - Reworded sentence: "The following is SCE's investment in each asset as of December 31, 2025: (in millions)Plant inServiceConstructionWork inProgressAccumulatedDepreciationNuclear Fuel(at amortized cost)TotalOwnershipInterestTransmission systems:Eldorado$511 $1 $(74)$ - $438 72 %Pacific Intertie356 9 (128) - 237 50 %Generating station:Palo Verde (nuclear)2,265 99 (1,713)130 781 16 %Total$3,132 $109 $(1,915)$130 $1,456 In addition to the jointly owned assets in the table above, SCE has ownership interests in jointly owned power poles with other companies." **Prior (2025):** SCE owns undivided interests in transmission and generating assets for which each participant provides its own financing. SCE's proportionate share of these assets is reflected in the consolidated balance sheets and included in the above table. SCE's proportionate share of expenses for each project is reflected in the consolidated statements of income. The following is SCE's investment in each asset as of December 31, 2024: (in millions)Plant inServiceConstructionWork inProgressAccumulatedDepreciationNuclear Fuel(at amortized cost)TotalOwnershipInterestTransmission systems:Eldorado$448 $40 $(71)$ - $417 71 %Pacific Intertie356 8 (121) - 243 50 %Generating station:Palo Verde (nuclear)2,249 62 (1,694)124 741 16 %Total$3,053 $110 $(1,886)$124 $1,401 In addition to the jointly owned assets in the table above, SCE has ownership interests in jointly owned power poles with other companies. **Current (2026):** SCE owns undivided interests in transmission and generating assets for which each participant provides its own financing. SCE's proportionate share of these assets is reflected in the consolidated balance sheets and included in the above table. SCE's proportionate share of expenses for each project is reflected in the consolidated statements of income. The following is SCE's investment in each asset as of December 31, 2025: (in millions)Plant inServiceConstructionWork inProgressAccumulatedDepreciationNuclear Fuel(at amortized cost)TotalOwnershipInterestTransmission systems:Eldorado$511 $1 $(74)$ - $438 72 %Pacific Intertie356 9 (128) - 237 50 %Generating station:Palo Verde (nuclear)2,265 99 (1,713)130 781 16 %Total$3,132 $109 $(1,915)$130 $1,456 In addition to the jointly owned assets in the table above, SCE has ownership interests in jointly owned power poles with other companies. --- ## Modified: Unrecognized Tax Benefits **Key changes:** - Reworded sentence: "The following table provides a reconciliation of unrecognized tax benefits: Edison InternationalSCE(in millions)202520242023202520242023Balance at January 1,$463 $430 $646 $457 $418 $374 Tax positions taken during the current year:Increases50 66 65 50 66 65 Tax positions taken during a prior year:Increases - 1 13 - - 4 Decreases1(30)(34)(294)(30)(27)(25)Balance at December 31,$483 $463 $430 $477 $457 $418 Decreases1 1The Edison International decrease in 2023 was mainly related to a write-off of a reserve for a claim related to the Edison Mission Energy bankruptcy." **Prior (2025):** The following table provides a reconciliation of unrecognized tax benefits: Edison InternationalSCE(in millions)202420232022202420232022Balance at January 1,$430 $646 $613 $418 $374 $340 Tax positions taken during the current year:Increases66 65 54 66 65 54 Tax positions taken during a prior year:Increases1 13 - - 4 - Decreases1(34)(294)(21)(27)(25)(20)Balance at December 31,$463 $430 $646 $457 $418 $374 Decreases1 1The Edison International decrease in 2023 was mainly related to a write-off of a reserve for a claim related to the Edison Mission Energy bankruptcy. 1 As of December 31, 2024, if recognized, $72 million of unrecognized tax benefits would impact Edison International's effective tax rate and $66 million of the unrecognized tax benefits would impact SCE's effective tax rate. **Current (2026):** The following table provides a reconciliation of unrecognized tax benefits: Edison InternationalSCE(in millions)202520242023202520242023Balance at January 1,$463 $430 $646 $457 $418 $374 Tax positions taken during the current year:Increases50 66 65 50 66 65 Tax positions taken during a prior year:Increases - 1 13 - - 4 Decreases1(30)(34)(294)(30)(27)(25)Balance at December 31,$483 $463 $430 $477 $457 $418 Decreases1 1The Edison International decrease in 2023 was mainly related to a write-off of a reserve for a claim related to the Edison Mission Energy bankruptcy. 1 As of December 31, 2025, if recognized, $70 million of unrecognized tax benefits would impact Edison International's effective tax rate and $64 million of the unrecognized tax benefits would impact SCE's effective tax rate. --- ## Modified: Notional Volumes of Derivative Instruments **Key changes:** - Reworded sentence: "The following table summarizes the notional volumes of derivatives used for SCE's economic hedging activities: Economic HedgesUnit ofMeasureDecember 31,Commodity20252024Electricity options, swaps and forwardsGigawatt hours3,2493,295Natural gas options, swaps and forwardsBillion cubic feet44Congestion revenue rightsGigawatt hours5,5668,141Fin Toll arrangementsGigawatt hours228 - " **Prior (2025):** The following table summarizes the notional volumes of derivatives used for SCE's economic hedging activities: Economic HedgesUnit ofMeasureDecember 31,Commodity20242023Electricity options, swaps and forwardsGigawatt hours3,2953,494Natural gas options, swaps and forwardsBillion cubic feet431Congestion revenue rightsGigawatt hours8,14135,011 **Current (2026):** The following table summarizes the notional volumes of derivatives used for SCE's economic hedging activities: Economic HedgesUnit ofMeasureDecember 31,Commodity20252024Electricity options, swaps and forwardsGigawatt hours3,2493,295Natural gas options, swaps and forwardsBillion cubic feet44Congestion revenue rightsGigawatt hours5,5668,141Fin Toll arrangementsGigawatt hours228 - --- ## Modified: Earnings Per Share **Key changes:** - Reworded sentence: "EPS available to Edison International common shareholders was computed as follows: Years ended December 31,(in millions, except per-share amounts)202520242023Basic earnings per share:Net income available to Edison International common shareholders$4,459 $1,284 $1,197 Earnings allocated to participating securities(2) - - Income available to common shareholders$4,457 $1,284 $1,197 Weighted average common shares outstanding385 386 383 Basic earnings per share$11.58 $3.33 $3.12 Diluted earnings per share:Income available to common shareholders$4,457 $1,284 $1,197 Add back: Earnings allocated to participating securities2 1 1 Net income available to Edison International common shareholders$4,459 $1,285 $1,198 Weighted average common shares outstanding385 386 383 Effect of dilutive securities1 2 2 Adjusted weighted average shares - diluted386 388 385 Diluted earnings per share$11.55 $3.31 $3.11 Earnings allocated to participating securities Income available to common shareholders In addition to the participating securities discussed above, Edison International also may award stock options, which are payable in common shares and are included in the diluted earnings per share calculation." **Prior (2025):** Edison International computes earnings per common share ("EPS") using the two-class method, which is an earnings allocation formula that determines EPS for each class of common stock and participating security. Edison International's participating securities are stock-based compensation awards, payable in common shares, which earn dividend equivalents on an equal basis with common shares once the awards are vested. See Note 9 and Note 14 for further information. EPS attributable to Edison International common shareholders was computed as follows: Years ended December 31,(in millions, except per-share amounts)202420232022Basic earnings per share:Net income available to common shareholders$1,284 $1,197 $612 Weighted average common shares outstanding386 383 381 Basic earnings per share$3.33 $3.12 $1.61 Diluted earnings per share:Net income available to common shareholders$1,284 $1,197 $612 Income impact of assumed conversions1 1 1 Net income available to common shareholders and assumed conversions$1,285 $1,198 $613 Weighted average common shares outstanding386 383 381 Incremental shares from assumed conversions2 2 2 Adjusted weighted average shares - diluted388 385 383 Diluted earnings per share$3.31 $3.11 $1.60 In addition to the participating securities discussed above, Edison International also may award stock options, which are payable in common shares and are included in the diluted earnings per share calculation. Stock option awards to purchase 1,533,982, 3,771,766, and 5,839,549 of common stock for the years ended December 31, 2024, 2023, and 2022, respectively, were outstanding, but were not included in the computation of diluted earnings per share because the effect would have been antidilutive. **Current (2026):** Edison International computes earnings per common share ("EPS") using the two-class method, which is an earnings allocation formula that determines EPS for each class of common stock and participating security. Edison International's participating securities are stock-based compensation awards, payable in common shares, which earn dividend equivalents on an equal basis with common shares once the awards are vested. See Note 9 and Note 14 for further information. EPS available to Edison International common shareholders was computed as follows: Years ended December 31,(in millions, except per-share amounts)202520242023Basic earnings per share:Net income available to Edison International common shareholders$4,459 $1,284 $1,197 Earnings allocated to participating securities(2) - - Income available to common shareholders$4,457 $1,284 $1,197 Weighted average common shares outstanding385 386 383 Basic earnings per share$11.58 $3.33 $3.12 Diluted earnings per share:Income available to common shareholders$4,457 $1,284 $1,197 Add back: Earnings allocated to participating securities2 1 1 Net income available to Edison International common shareholders$4,459 $1,285 $1,198 Weighted average common shares outstanding385 386 383 Effect of dilutive securities1 2 2 Adjusted weighted average shares - diluted386 388 385 Diluted earnings per share$11.55 $3.31 $3.11 Earnings allocated to participating securities Income available to common shareholders In addition to the participating securities discussed above, Edison International also may award stock options, which are payable in common shares and are included in the diluted earnings per share calculation. Stock option awards to purchase 8,891,163, 1,533,982, and 3,771,766 of common stock for the years ended December 31, 2025, 2024, and 2023, respectively, were outstanding, but were not included in the computation of diluted earnings per share because the effect would have been antidilutive. 69 69 69 Table of Contents Table of Contents --- ## Modified: SCE Dividends **Key changes:** - Reworded sentence: "The common equity component of SCE's CPUC authorized capital structure is 52% on a weighted average basis over the Capital Structure Compliance Period, unchanged from the January 1, 2023 to December 31, 2025 compliance period." - Reworded sentence: "68 68 68 Table of Contents Table of Contents As a California corporation, SCE's ability to pay dividends is also governed by the California General Corporation Law." - Reworded sentence: "On February 18, 2026, SCE declared a dividend to Edison International of $430 million." - Reworded sentence: "If SCE incurs significant costs related to catastrophic wildfires and is unable to recover such costs through insurance, the Wildfire Fund (for fires after July 12, 2019), or from customers or is unable to access capital markets on reasonable terms, SCE may be limited in its ability to pay future dividends to Edison International and its preference shareholders." **Prior (2025):** CPUC holding company rules require that SCE's dividend policy be established by the SCE Board of Directors on the same basis as if SCE were a stand-alone utility company, and that the capital requirements of SCE, as deemed to be necessary to meet SCE's electricity service obligations, shall receive first priority from the Boards of Directors of both Edison International and SCE. In addition, the CPUC regulates SCE's capital structure which limits the dividends it may pay to its shareholders. The common equity component of SCE's CPUC authorized capital structure is 52% on a weighted average basis over the January 1, 2023 to December 31, 2025 compliance period ("Capital Structure Compliance Period"). The CPUC authorized capital structure differs from the capital structure calculated based on GAAP due to certain exclusions allowed by CPUC, including the impact of SCE's contributions to the Wildfire Insurance Fund under AB 1054. In August 2023, the CPUC issued a decision on SCE's application to the CPUC for an extension of the waiver of compliance with its equity ratio requirement that allows SCE to exclude from its equity ratio calculations (i) net charges accrued in connection with the 2017/2018 Wildfire/Mudslide Events and (ii) debt issued for the purpose of paying claims, and associated expenses, related to the 2017/2018 Wildfire/Mudslide Events up to an amount equal to the net charges accrued in connection with the 2017/2018 Wildfire/Mudslide Events. Under the decision, effective as of the beginning of the new cost of capital cycle on January 1, 2023, the CPUC also authorized SCE to exclude from its equity ratio calculations debt that exceeds the net charges accrued in connection with the 2017/2018 Wildfire/Mudslide Events due to the timing difference between the wildfire claims payment and the realization of the cash tax benefits. The temporary exclusion will lapse on August 31, 2025, or when determinations regarding cost recovery for both TKM and the Woolsey Fire are made, whichever comes earlier. In January 2025, the CPUC approved the TKM Settlement Agreement, under which SCE is allowed to permanently exclude any after-tax charges to equity associated with the costs disallowed or funded by shareholders in the TKM Settlement Agreement and the debt issued to finance those costs. If the CPUC has not made a determination regarding cost recovery related to the Woolsey Fire by August 31, 2025, SCE will file another application for a waiver of compliance with its equity ratio requirement. While the temporary exclusion is in place, SCE is required to notify the CPUC if an adverse financial event reduces SCE's spot equity ratio by more than one percent from the level most recently filed with the CPUC in the proceeding. The last spot equity ratio SCE filed with the CPUC in the proceeding did not exclude the then $1.8 billion net charge and was 45.2% as of December 31, 2018 (at the time the common equity component of SCE's CPUC authorized capital structure was required to remain at or above 48% on a weighted average basis over the applicable 37-month period). SCE's spot equity ratio on December 31, 2018, would have been 48.7% had the $1.8 billion net charge at December 31, 2018 been excluded, therefore SCE will notify the CPUC if its spot ratio drops below 47.7% in any quarter. SCE monitors its compliance with the CPUC's equity ratio requirement based on the weighted average of the common equity component of SCE's CPUC authorized capital structure over the Capital Structure Compliance Period using its actual capital structure from the beginning of the Capital Structure Compliance Period through the reporting date together with forecasted performance and expected financing activities for the remainder of the Capital Structure Compliance Period. SCE expects to be compliant with its CPUC authorized capital structure at the end of the Capital Structure Compliance Period. SCE's ability to declare and pay common dividends may be restricted under the terms of its outstanding series of preference stock. For further information see Note 14. As a California corporation, SCE's ability to pay dividends is also governed by the California General Corporation Law. California law requires that for a dividend to be declared: (a) retained earnings must equal or exceed the proposed dividend, or (b) immediately after the dividend is made, the value of the corporation's assets must exceed the value of its liabilities plus amounts required to be paid, if any, in order to liquidate stock senior to the shares receiving the dividend. Additionally, a California corporation may not declare a dividend if it is, or as a result of the dividend would be, likely to be unable to meet its liabilities as they mature. Prior to declaring dividends, the SCE Board of Directors evaluates available information, including when applicable, information pertaining to wildfire events, to ensure that the California law requirements for the declarations are met. On February 27, 2025, SCE declared a dividend to Edison International of $430 million. The timing and amount of future dividends are also dependent on a number of other factors including SCE's requirements to fund other obligations and capital expenditures, and its ability to access the capital markets and generate operating cash flows and earnings. If SCE incurs significant costs related to catastrophic wildfires and is unable to recover such costs through insurance, the Wildfire Insurance Fund (for fires after July 12, 2019), or from customers or is unable to access 69 69 69 Table of Contents Table of Contents capital markets on reasonable terms, SCE may be limited in its ability to pay future dividends to Edison International and its preference shareholders. **Current (2026):** CPUC holding company rules require that SCE's dividend policy be established by the SCE Board of Directors on the same basis as if SCE were a stand-alone utility company, and that the capital requirements of SCE, as deemed to be necessary to meet SCE's electricity service obligations, shall receive first priority from the Boards of Directors of both Edison International and SCE. In addition, the CPUC regulates SCE's capital structure which limits the dividends it may pay to its shareholders. The common equity component of SCE's CPUC authorized capital structure is 52% on a weighted average basis over the Capital Structure Compliance Period, unchanged from the January 1, 2023 to December 31, 2025 compliance period. The CPUC authorized capital structure differs from the capital structure calculated based on GAAP due to certain exclusions allowed by CPUC, including the impact of SCE's contributions to the Wildfire Fund under the California Wildfire Legislation. In January and December 2025, the CPUC approved the TKM Settlement Agreement and the Woolsey Settlement Agreement, under which SCE is allowed to permanently exclude any after-tax charges to equity associated with the costs disallowed or funded by shareholders in the TKM Settlement Agreement and Woolsey Settlement Agreement, and the debt issued to finance those costs. SCE monitors its compliance with the CPUC's equity ratio requirement based on the weighted average of the common equity component of SCE's CPUC authorized capital structure over the Capital Structure Compliance Period using its actual capital structure from the beginning of the Capital Structure Compliance Period through the reporting date together with forecasted performance and expected financing activities for the remainder of the Capital Structure Compliance Period. SCE expects to be compliant with its CPUC authorized capital structure at the end of the Capital Structure Compliance Period. SCE's ability to declare and pay common dividends may be restricted under the terms of its outstanding series of preference stock. For further information see Note 14. 68 68 68 Table of Contents Table of Contents As a California corporation, SCE's ability to pay dividends is also governed by the California General Corporation Law. California law requires that for a dividend to be declared: (a) retained earnings must equal or exceed the proposed dividend, or (b) immediately after the dividend is made, the value of the corporation's assets must exceed the value of its liabilities plus amounts required to be paid, if any, in order to liquidate stock senior to the shares receiving the dividend. Additionally, a California corporation may not declare a dividend if it is, or as a result of the dividend would be, likely to be unable to meet its liabilities as they mature. Prior to declaring dividends, the SCE Board of Directors evaluates available information, including when applicable, information pertaining to wildfire events, to ensure that the California law requirements for the declarations are met. On February 18, 2026, SCE declared a dividend to Edison International of $430 million. The timing and amount of future dividends are also dependent on a number of other factors including SCE's requirements to fund other obligations and capital expenditures, and its ability to access the capital markets and generate operating cash flows and earnings. If SCE incurs significant costs related to catastrophic wildfires and is unable to recover such costs through insurance, the Wildfire Fund (for fires after July 12, 2019), or from customers or is unable to access capital markets on reasonable terms, SCE may be limited in its ability to pay future dividends to Edison International and its preference shareholders. --- ## Modified: Impairment of Long-Lived Assets **Key changes:** - Reworded sentence: "In September 2025, the CPUC issued a final decision in SCE's 2025 GRC proceeding." **Prior (2025):** Impairments of long-lived assets are evaluated based on a review of estimated future cash flows expected to be generated whenever events or changes in circumstances indicate that the carrying amount of such investments or assets may not be recoverable. If the carrying amount of a long-lived asset exceeds expected future cash flows, undiscounted and without interest charges, an impairment loss is recognized in the amount of the excess of fair value over the carrying amount. Fair value is determined via market, cost and income-based valuation techniques, as appropriate. Accounting principles for rate-regulated enterprises also require recognition of an impairment loss if it becomes probable that the regulated utility will abandon a plant investment, or if it becomes probable that the cost of a recently completed plant will be disallowed, either directly or indirectly, for ratemaking purposes, and a reasonable estimate of the disallowance amount can be made. Upon approval of the TKM Settlement Agreement, SCE will record an impairment charge of approximately $10 million in the first quarter of 2025. For further information on the TKM Settlement Agreement, see "Note 12. Commitments and Contingencies - Contingencies - Southern California Wildfires and Mudslides." **Current (2026):** Impairments of long-lived assets are evaluated based on a review of estimated future cash flows expected to be generated whenever events or changes in circumstances indicate that the carrying amount of such investments or assets may not be recoverable. If the carrying amount of a long-lived asset exceeds expected future cash flows, undiscounted and without interest charges, an impairment loss is recognized in the amount of the excess of fair value over the carrying amount. Fair value is determined via market, cost and income-based valuation techniques, as appropriate. Accounting principles for rate-regulated enterprises also require recognition of an impairment loss if it becomes probable that the regulated utility will abandon a plant investment, or if it becomes probable that the cost of a recently completed plant will be disallowed, either directly or indirectly, for ratemaking purposes, and a reasonable estimate of the disallowance amount can be made. In September 2025, the CPUC issued a final decision in SCE's 2025 GRC proceeding. As a result of the decision, SCE recorded an $88 million impairment of utility property, plant and equipment that was disallowed by the CPUC, primarily related to the rooftop solar photovoltaic program. impairment of utility property, plant and equipment In 2025, SCE recorded an impairment of $18 million related to utility property, plant and equipment associated with historical capital expenditures disallowed in the TKM and Woolsey Settlement Agreements. --- ## Modified: Critical Audit Matters **Key changes:** - Reworded sentence: "Southern California Wildfires Loss Contingencies - 2025 Eaton Fire As described in Note 12 to the consolidated financial statements, in January 2025, several wind-driven wildfires impacted portions of Southern California Edison Company's (SCE) service area, causing loss of life, substantial damage to both residential and business properties, and service outages for SCE customers." - Reworded sentence: "The process for estimating losses associated with alleged and potential wildfire related claims requires management to exercise significant judgment based on a number of assumptions and subjective factors, including, but not limited to: volumes of claims, damages asserted and associated loss, opinions of counsel regarding litigation risk, the status of and developments in the course of litigation, prior experience litigating and settling wildfire litigation claims, the amount of insurance that may offset losses, and estimating contributory liabilities from third parties who may be responsible for portions of loss." - Reworded sentence: "In light of pending litigation, it is probable that the Company will incur additional material losses in connection with the Eaton Fire; however, the Company is currently unable to reasonably estimate a range of losses that may be incurred." - Reworded sentence: "These procedures included testing the effectiveness of controls relating to management's assessment of the loss contingencies associated with the 2025 Eaton Fire, including controls over assessing whether a loss is probable and whether the amount of the loss or range of loss can be reasonably estimated based on currently available information, as well as financial statement disclosures." - Reworded sentence: "As of December 31, 2025, $16.3 billion was recorded in regulatory assets and $11.8 billion was recorded in regulatory liabilities." **Prior (2025):** The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that (i) relate to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. Wildfire-Related Claims - 2017/2018 Wildfire/Mudslide Events As described in Note 12 to the consolidated financial statements, the Thomas Fire, the Koenigstein Fire, the Montecito Mudslides and the Woolsey Fire (collectively, the "2017/2018 Wildfire/Mudslide Events") within the Company's service area caused loss of life, substantial damage to both residential and business properties, and service outages for the Company's customers. Numerous claims related to wildfire events have been initiated against the Company. The Company has incurred material losses in connection with the 2017/2018 Wildfire/Mudslide Events. As disclosed by management, management records loss contingencies when it determines that the outcome of future events is probable of occurring and when the amount of the loss can be reasonably estimated. As of December 31, 2024, the Company had paid $9.5 billion under executed settlements, had $86 million to be paid under executed settlements, including $57 million to be paid under the Safety and Enforcement Division agreement, and had $340 million of estimated losses for remaining alleged and potential claims reflected on its consolidated balance sheets related to the 2017/2018 Wildfire/Mudslide Events. As of the same date, the Company had assets for expected recoveries through Federal Energy Regulatory Commission (FERC) electric rates of $64 million on its consolidated balance sheets and had exhausted expected insurance recoveries related to the 2017/2018 Wildfire/Mudslide Events. Each reporting period, management reviews the Company's loss estimates for remaining alleged and potential claims related to wildfire events. The process for estimating losses associated with alleged and potential wildfire related claims requires management to exercise significant judgment based on a number of assumptions and subjective factors, including, but not limited to: estimates of known and expected claims by third parties based on currently available information, opinions of counsel regarding litigation risk, the status of and developments in the course of litigation, and prior experience litigating and settling wildfire litigation claims. As additional information becomes available, management's estimates and assumptions regarding the causes and financial impact of wildfire events may change. For the year ended December 31, 2024 management recorded charges for wildfire claims of $490 million and expected revenue from FERC customers of $27 million. The resulting pre-tax charge to earnings was $463 million ($333 million after-tax). The principal considerations for our determination that performing procedures relating to the wildfire-related claims from the 2017/2018 Wildfire/Mudslide Events is a critical audit matter are (i) the significant judgment by management when determining whether the outcome of future events is probable of occurring and whether the amount of the loss can be reasonably estimated as well as in estimating losses associated with alleged and potential claims related to wildfire events and (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management's significant assumptions related to estimates of known and expected claims by third parties based on currently available information, opinions of counsel regarding litigation risk, and prior experience litigating and settling wildfire litigation claims. Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to management's assessment of loss contingencies associated with alleged and potential claims related to wildfire events. These procedures also included, among others (i) obtaining and evaluating the letters of audit inquiry with internal and external legal counsel; (ii) assessing the reasonableness of management's assessment regarding whether the outcome of future events is probable of occurring and whether the amount of the loss can be reasonably estimated; (iii) evaluating the appropriateness of the methods used by management in estimating losses associated with alleged and potential claims related to wildfire events; (iv) evaluating the reasonableness of the significant assumptions related to estimates of known and expected claims by third parties based on currently available information, opinions of counsel regarding litigation risk, and prior experience litigating and settling wildfire litigation claims; and (v) testing, on a sample basis, damage claim settlements. Evaluating management's assumptions involved evaluating whether the assumptions used by management were reasonable considering (i) current damage claim settlements; (ii) past wildfire litigation history; and (iii) third-party source data. 44 44 44 Table of Contents Table of Contents Accounting for the Effects of Rate Regulation As described in Notes 1 and 11 to the consolidated financial statements, the Company's accounting policies conform to accounting principles generally accepted in the United States of America, including the accounting principles for rate-regulated enterprises, which reflect the ratemaking policies of the California Public Utility Commission (CPUC) and the FERC. Management applies authoritative guidance for rate-regulated enterprises to the portion of the Company's operations in which regulators set rates at levels intended to recover the estimated costs of providing service, plus a return on net investments in assets, or rate base. Regulators may also impose certain penalties or grant certain incentives. Due to timing and other differences in the collection of electric utility revenue, these accounting principles require an incurred cost that would otherwise be charged to expense by a non-regulated entity to be capitalized as a regulatory asset if it is probable that the cost is recoverable through future rates; and conversely the accounting principles require recording of a regulatory liability for amounts collected in rates to recover costs expected to be incurred in the future or amounts collected in excess of costs incurred and refundable to customers. As disclosed by management, management assesses at the end of each reporting period whether regulatory assets are probable of future recovery by considering factors such as the current regulatory environment, the issuance of rate orders on recovery of the specific or a similar incurred cost to the Company or other rate-regulated entities, and other factors that would indicate that the regulator will treat an incurred cost as allowable for ratemaking purposes. As of December 31, 2024, $11.6 billion was recorded in regulatory assets and $11.5 billion was recorded in regulatory liabilities. The principal considerations for our determination that performing procedures relating to the Company's accounting for the effects of rate regulation is a critical audit matter are a high degree of auditor effort in performing procedures and evaluating audit evidence related to (i) accounting for the effect of rate regulation on regulatory assets and liabilities and (ii) management's assessment of the recoverability and settlement of existing and new regulatory assets and liabilities. Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to the Company's regulatory accounting process, including controls over management's assessment of the recoverability and settlement of existing and new regulatory assets and liabilities. These procedures also included, among others (i) obtaining and evaluating the Company's correspondence with regulators; (ii) evaluating management's assessment regarding the probability of recovery of regulatory assets and settlement of regulatory liabilities at the balance sheet date; (iii) evaluating the appropriateness of the accounting for the effects of the rate regulation; (iv) evaluating the sufficiency of the disclosure; and (v) testing, on a sample basis, the calculation of regulatory assets and regulatory liabilities based on provisions outlined in the rate orders. /s/PricewaterhouseCoopers LLP Los Angeles, California February 27, 2025 We have served as the Company's auditor since 2002. 45 45 45 Table of Contents Table of Contents **Current (2026):** The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that (i) relate to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. Southern California Wildfires Loss Contingencies - 2025 Eaton Fire As described in Note 12 to the consolidated financial statements, in January 2025, several wind-driven wildfires impacted portions of Southern California Edison Company's (SCE) service area, causing loss of life, substantial damage to both residential and business properties, and service outages for SCE customers. One of the largest of these wildfires, the "Eaton Fire," ignited in SCE's service area in Los Angeles County and spread due to a number of contributing factors under conditions of an extreme Santa Ana windstorm. Each reporting period, management reviews the Company's loss estimates for remaining alleged and potential claims related to wildfire events. The process for estimating losses associated with alleged and potential wildfire related claims requires management to exercise significant judgment based on a number of assumptions and subjective factors, including, but not limited to: volumes of claims, damages asserted and associated loss, opinions of counsel regarding litigation risk, the status of and developments in the course of litigation, prior experience litigating and settling wildfire litigation claims, the amount of insurance that may offset losses, and estimating contributory liabilities from third parties who may be responsible for portions of loss. As additional information becomes available, management's estimates and assumptions regarding the causes and financial impact of wildfire events may change. In light of pending litigation, it is probable that the Company will incur additional material losses in connection with the Eaton Fire; however, the Company is currently unable to reasonably estimate a range of losses that may be incurred. The principal considerations for our determination that performing procedures relating to the Southern California Wildfires Loss Contingencies - 2025 Eaton Fire is a critical audit matter are (i) the significant judgment by management when determining whether a loss is probable and when determining whether the amount of the loss or range of loss can be reasonably estimated as it relates to the 2025 Eaton Fire and (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management's assessment of the loss contingencies associated with the 2025 Eaton Fire. Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to management's assessment of the loss contingencies associated with the 2025 Eaton Fire, including controls over assessing whether a loss is probable and whether the amount of the loss or range of loss can be reasonably estimated based on currently available information, as well as financial statement disclosures. These procedures also included, among others (i) obtaining and evaluating the letters of audit inquiry with internal and external legal counsel, (ii) evaluating, on a sample basis, contracts and agreements for executed settlements, (iii) evaluating the reasonableness of management's assessment regarding whether an unfavorable outcome is reasonably possible or probable and reasonably estimable; and (iv) evaluating the sufficiency of the Company's disclosures related to the 2025 Eaton Fire. Accounting for the Effects of Rate Regulation As described in Notes 1 and 11 to the consolidated financial statements, the Company's accounting policies conform to accounting principles generally accepted in the United States of America, including the accounting principles for rate-regulated enterprises, which reflect the ratemaking policies of the California Public Utility Commission (CPUC) and the FERC. Management applies authoritative guidance for rate-regulated enterprises to the portion of the Company's operations in which regulators set rates at levels intended to recover the estimated costs of providing service, plus a return on net investments in assets, or rate base. Regulators may also impose certain penalties or grant certain incentives. Due to timing and other differences in the collection of electric utility revenue, these accounting principles require an incurred cost that would otherwise be charged to expense by a non-regulated entity to be capitalized as a regulatory asset if it is probable that the cost is recoverable through future rates; and conversely the accounting principles require recording of a regulatory liability for amounts collected in rates to recover costs expected to be incurred in the future or amounts collected in excess of costs incurred and refundable to customers. As disclosed by management, management assesses at the end of each reporting period whether regulatory assets are probable of future recovery by considering factors such as the current regulatory environment, the issuance of rate orders on recovery of the specific or a similar incurred cost to the Company or other rate-regulated entities, and other factors that would indicate that the regulator will treat an incurred cost as allowable for ratemaking purposes. As of December 31, 2025, $16.3 billion was recorded in regulatory assets and $11.8 billion was recorded in regulatory liabilities. 44 44 44 Table of Contents Table of Contents The principal considerations for our determination that performing procedures relating to accounting for the effects of rate regulation is a critical audit matter are a high degree of auditor effort in performing procedures and evaluating audit evidence related to management's assessment of the recoverability and settlement of existing and new regulatory assets and liabilities. Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to the Company's regulatory accounting process, including controls over management's assessment of the recoverability and settlement of existing and new regulatory assets and liabilities. These procedures also included, among others (i) obtaining and evaluating the Company's correspondence with regulators; (ii) evaluating the reasonableness of management's assessment regarding the probability of recovery of regulatory assets and settlement of regulatory liabilities at the balance sheet date; (iii) evaluating the sufficiency of the disclosures; and (iv) testing, on a sample basis, the calculation of regulatory assets and regulatory liabilities based on provisions outlined in the rate orders. /s/PricewaterhouseCoopers LLP Los Angeles, California February 18, 2026 We have served as the Company's auditor since 2002. 45 45 45 Table of Contents Table of Contents --- ## Modified: Critical Audit Matters **Key changes:** - Reworded sentence: "Southern California Wildfires Loss Contingencies - 2025 Eaton Fire As described in Note 12 to the consolidated financial statements, in January 2025, several wind-driven wildfires impacted portions of Southern California Edison Company's (SCE) service area, causing loss of life, substantial damage to both residential and business properties, and service outages for SCE customers." - Reworded sentence: "The process for estimating losses associated with alleged and potential wildfire related claims requires management to exercise significant judgment based on a number of assumptions and subjective factors, including, but not limited to: volumes of claims, damages asserted and associated loss, opinions of counsel regarding litigation risk, the status of and developments in the course of litigation, prior experience litigating and settling wildfire litigation claims, the amount of insurance that may offset losses, and estimating contributory liabilities from third parties who may be responsible for portions of loss." - Reworded sentence: "In light of pending litigation, it is probable that the Company will incur additional material losses in connection with the Eaton Fire; however, the Company is currently unable to reasonably estimate a range of losses that may be incurred." - Reworded sentence: "These procedures included testing the effectiveness of controls relating to management's assessment of the loss contingencies associated with the 2025 Eaton Fire, including controls over assessing whether a loss is probable and whether the amount of the loss or range of loss can be reasonably estimated based on currently available information, as well as financial statement disclosures." - Reworded sentence: "As of December 31, 2025, $16.3 billion was recorded in regulatory assets and $11.8 billion was recorded in regulatory liabilities." **Prior (2025):** The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that (i) relate to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. Wildfire-Related Claims - 2017/2018 Wildfire/Mudslide Events As described in Note 12 to the consolidated financial statements, the Thomas Fire, the Koenigstein Fire, the Montecito Mudslides and the Woolsey Fire (collectively, the "2017/2018 Wildfire/Mudslide Events") within the Company's service area caused loss of life, substantial damage to both residential and business properties, and service outages for the Company's customers. Numerous claims related to wildfire events have been initiated against the Company. The Company has incurred material losses in connection with the 2017/2018 Wildfire/Mudslide Events. As disclosed by management, management records loss contingencies when it determines that the outcome of future events is probable of occurring and when the amount of the loss can be reasonably estimated. As of December 31, 2024, the Company had paid $9.5 billion under executed settlements, had $86 million to be paid under executed settlements, including $57 million to be paid under the Safety and Enforcement Division agreement, and had $340 million of estimated losses for remaining alleged and potential claims reflected on its consolidated balance sheets related to the 2017/2018 Wildfire/Mudslide Events. As of the same date, the Company had assets for expected recoveries through Federal Energy Regulatory Commission (FERC) electric rates of $64 million on its consolidated balance sheets and had exhausted expected insurance recoveries related to the 2017/2018 Wildfire/Mudslide Events. Each reporting period, management reviews the Company's loss estimates for remaining alleged and potential claims related to wildfire events. The process for estimating losses associated with alleged and potential wildfire related claims requires management to exercise significant judgment based on a number of assumptions and subjective factors, including, but not limited to: estimates of known and expected claims by third parties based on currently available information, opinions of counsel regarding litigation risk, the status of and developments in the course of litigation, and prior experience litigating and settling wildfire litigation claims. As additional information becomes available, management's estimates and assumptions regarding the causes and financial impact of wildfire events may change. For the year ended December 31, 2024 management recorded charges for wildfire claims of $490 million and expected revenue from FERC customers of $27 million. The resulting pre-tax charge to earnings was $463 million ($333 million after-tax). The principal considerations for our determination that performing procedures relating to the wildfire-related claims from the 2017/2018 Wildfire/Mudslide Events is a critical audit matter are (i) the significant judgment by management when determining whether the outcome of future events is probable of occurring and whether the amount of the loss can be reasonably estimated as well as in estimating losses associated with alleged and potential claims related to wildfire events and (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management's significant assumptions related to estimates of known and expected claims by third parties based on currently available information, opinions of counsel regarding litigation risk, and prior experience litigating and settling wildfire litigation claims. Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to management's assessment of loss contingencies associated with alleged and potential claims related to wildfire events. These procedures also included, among others (i) obtaining and evaluating the letters of audit inquiry with internal and external legal counsel; (ii) assessing the reasonableness of management's assessment regarding whether the outcome of future events is probable of occurring and whether the amount of the loss can be reasonably estimated; (iii) evaluating the appropriateness of the methods used by management in estimating losses associated with alleged and potential claims related to wildfire events; (iv) evaluating the reasonableness of the significant assumptions related to estimates of known and expected claims by third parties based on currently available information, opinions of counsel regarding litigation risk, and prior experience litigating and settling wildfire litigation claims; and (v) testing, on a sample basis, damage claim settlements. Evaluating management's assumptions involved evaluating whether the assumptions used by management were reasonable considering (i) current damage claim settlements; (ii) past wildfire litigation history; and (iii) third-party source data. 44 44 44 Table of Contents Table of Contents Accounting for the Effects of Rate Regulation As described in Notes 1 and 11 to the consolidated financial statements, the Company's accounting policies conform to accounting principles generally accepted in the United States of America, including the accounting principles for rate-regulated enterprises, which reflect the ratemaking policies of the California Public Utility Commission (CPUC) and the FERC. Management applies authoritative guidance for rate-regulated enterprises to the portion of the Company's operations in which regulators set rates at levels intended to recover the estimated costs of providing service, plus a return on net investments in assets, or rate base. Regulators may also impose certain penalties or grant certain incentives. Due to timing and other differences in the collection of electric utility revenue, these accounting principles require an incurred cost that would otherwise be charged to expense by a non-regulated entity to be capitalized as a regulatory asset if it is probable that the cost is recoverable through future rates; and conversely the accounting principles require recording of a regulatory liability for amounts collected in rates to recover costs expected to be incurred in the future or amounts collected in excess of costs incurred and refundable to customers. As disclosed by management, management assesses at the end of each reporting period whether regulatory assets are probable of future recovery by considering factors such as the current regulatory environment, the issuance of rate orders on recovery of the specific or a similar incurred cost to the Company or other rate-regulated entities, and other factors that would indicate that the regulator will treat an incurred cost as allowable for ratemaking purposes. As of December 31, 2024, $11.6 billion was recorded in regulatory assets and $11.5 billion was recorded in regulatory liabilities. The principal considerations for our determination that performing procedures relating to the Company's accounting for the effects of rate regulation is a critical audit matter are a high degree of auditor effort in performing procedures and evaluating audit evidence related to (i) accounting for the effect of rate regulation on regulatory assets and liabilities and (ii) management's assessment of the recoverability and settlement of existing and new regulatory assets and liabilities. Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to the Company's regulatory accounting process, including controls over management's assessment of the recoverability and settlement of existing and new regulatory assets and liabilities. These procedures also included, among others (i) obtaining and evaluating the Company's correspondence with regulators; (ii) evaluating management's assessment regarding the probability of recovery of regulatory assets and settlement of regulatory liabilities at the balance sheet date; (iii) evaluating the appropriateness of the accounting for the effects of the rate regulation; (iv) evaluating the sufficiency of the disclosure; and (v) testing, on a sample basis, the calculation of regulatory assets and regulatory liabilities based on provisions outlined in the rate orders. /s/PricewaterhouseCoopers LLP Los Angeles, California February 27, 2025 We have served as the Company's auditor since 2002. 45 45 45 Table of Contents Table of Contents **Current (2026):** The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that (i) relate to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. Southern California Wildfires Loss Contingencies - 2025 Eaton Fire As described in Note 12 to the consolidated financial statements, in January 2025, several wind-driven wildfires impacted portions of Southern California Edison Company's (SCE) service area, causing loss of life, substantial damage to both residential and business properties, and service outages for SCE customers. One of the largest of these wildfires, the "Eaton Fire," ignited in SCE's service area in Los Angeles County and spread due to a number of contributing factors under conditions of an extreme Santa Ana windstorm. Each reporting period, management reviews the Company's loss estimates for remaining alleged and potential claims related to wildfire events. The process for estimating losses associated with alleged and potential wildfire related claims requires management to exercise significant judgment based on a number of assumptions and subjective factors, including, but not limited to: volumes of claims, damages asserted and associated loss, opinions of counsel regarding litigation risk, the status of and developments in the course of litigation, prior experience litigating and settling wildfire litigation claims, the amount of insurance that may offset losses, and estimating contributory liabilities from third parties who may be responsible for portions of loss. As additional information becomes available, management's estimates and assumptions regarding the causes and financial impact of wildfire events may change. In light of pending litigation, it is probable that the Company will incur additional material losses in connection with the Eaton Fire; however, the Company is currently unable to reasonably estimate a range of losses that may be incurred. The principal considerations for our determination that performing procedures relating to the Southern California Wildfires Loss Contingencies - 2025 Eaton Fire is a critical audit matter are (i) the significant judgment by management when determining whether a loss is probable and when determining whether the amount of the loss or range of loss can be reasonably estimated as it relates to the 2025 Eaton Fire and (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management's assessment of the loss contingencies associated with the 2025 Eaton Fire. Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to management's assessment of the loss contingencies associated with the 2025 Eaton Fire, including controls over assessing whether a loss is probable and whether the amount of the loss or range of loss can be reasonably estimated based on currently available information, as well as financial statement disclosures. These procedures also included, among others (i) obtaining and evaluating the letters of audit inquiry with internal and external legal counsel, (ii) evaluating, on a sample basis, contracts and agreements for executed settlements, (iii) evaluating the reasonableness of management's assessment regarding whether an unfavorable outcome is reasonably possible or probable and reasonably estimable; and (iv) evaluating the sufficiency of the Company's disclosures related to the 2025 Eaton Fire. Accounting for the Effects of Rate Regulation As described in Notes 1 and 11 to the consolidated financial statements, the Company's accounting policies conform to accounting principles generally accepted in the United States of America, including the accounting principles for rate-regulated enterprises, which reflect the ratemaking policies of the California Public Utility Commission (CPUC) and the FERC. Management applies authoritative guidance for rate-regulated enterprises to the portion of the Company's operations in which regulators set rates at levels intended to recover the estimated costs of providing service, plus a return on net investments in assets, or rate base. Regulators may also impose certain penalties or grant certain incentives. Due to timing and other differences in the collection of electric utility revenue, these accounting principles require an incurred cost that would otherwise be charged to expense by a non-regulated entity to be capitalized as a regulatory asset if it is probable that the cost is recoverable through future rates; and conversely the accounting principles require recording of a regulatory liability for amounts collected in rates to recover costs expected to be incurred in the future or amounts collected in excess of costs incurred and refundable to customers. As disclosed by management, management assesses at the end of each reporting period whether regulatory assets are probable of future recovery by considering factors such as the current regulatory environment, the issuance of rate orders on recovery of the specific or a similar incurred cost to the Company or other rate-regulated entities, and other factors that would indicate that the regulator will treat an incurred cost as allowable for ratemaking purposes. As of December 31, 2025, $16.3 billion was recorded in regulatory assets and $11.8 billion was recorded in regulatory liabilities. 44 44 44 Table of Contents Table of Contents The principal considerations for our determination that performing procedures relating to accounting for the effects of rate regulation is a critical audit matter are a high degree of auditor effort in performing procedures and evaluating audit evidence related to management's assessment of the recoverability and settlement of existing and new regulatory assets and liabilities. Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to the Company's regulatory accounting process, including controls over management's assessment of the recoverability and settlement of existing and new regulatory assets and liabilities. These procedures also included, among others (i) obtaining and evaluating the Company's correspondence with regulators; (ii) evaluating the reasonableness of management's assessment regarding the probability of recovery of regulatory assets and settlement of regulatory liabilities at the balance sheet date; (iii) evaluating the sufficiency of the disclosures; and (iv) testing, on a sample basis, the calculation of regulatory assets and regulatory liabilities based on provisions outlined in the rate orders. /s/PricewaterhouseCoopers LLP Los Angeles, California February 18, 2026 We have served as the Company's auditor since 2002. 45 45 45 Table of Contents Table of Contents --- ## Modified: New Accounting Guidance **Key changes:** - Reworded sentence: "Accounting Guidance Adopted In December 2023, the FASB issued an accounting standards update requiring additional disclosures primarily related to the income tax rate reconciliation and income taxes paid." - Reworded sentence: "Edison International and SCE are currently evaluating the impact of this new guidance." **Prior (2025):** Accounting Guidance Adopted In November 2023, the FASB issued an accounting standards update to enhance the disclosures related to public entities' reportable segments. The new guidance requires an entity with only one reportable segment to include all the required segment disclosures. Edison International and SCE each have one reportable segment, and have adopted this guidance for the year ended December 31, 2024. See "Segment Information" above for further information. Accounting Guidance Not Yet Adopted In December 2023, the FASB issued an accounting standards update requiring public entities to provide more disclosures primarily related to the income tax rate reconciliation and income taxes paid. The guidance also eliminates certain existing disclosure requirements related to uncertain tax positions and unrecognized deferred tax liabilities. The guidance is effective for annual periods after January 1, 2025 with early adoption permitted. The guidance is applied prospectively. Edison International and SCE are currently evaluating the impact of the new guidance. In November 2024, the FASB issued an accounting standards update requiring public entities to provide disaggregated disclosure of income statement expenses. The guidance does not change the expense captions an entity presents on the face of the income statement, rather, it requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements. The guidance is effective for annual disclosure for the year ended December 31, 2027 and subsequent interim periods with early adoption permitted. The guidance is applied prospectively. Edison International and SCE are currently evaluating the impact of the new guidance. **Current (2026):** Accounting Guidance Adopted In December 2023, the FASB issued an accounting standards update requiring additional disclosures primarily related to the income tax rate reconciliation and income taxes paid. The guidance also eliminates certain existing disclosures related to uncertain tax positions and unrecognized deferred tax liabilities. Edison International and SCE have applied this standard in the annual disclosure for the year ended December 31, 2025. See Note 8 for further information. Accounting Guidance Not Yet Adopted In November 2024, the FASB issued an accounting standards update requiring public entities to provide disaggregated disclosure of income statement expenses. The guidance does not change the expense captions an entity presents on the face of the income statement, rather, it requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements. The guidance is effective for annual disclosure for the year ended December 31, 2027 and subsequent interim periods with early adoption permitted. The guidance is applied prospectively. Edison International and SCE are currently evaluating the impact of this new guidance. In September 2025, the FASB issued an accounting standards update to amend certain aspects of the accounting for and disclosure of internal-use software. Among other things, the guidance removes all references to prescriptive and sequential software development stages and instead requires entities to begin capitalizing software costs when certain criteria are met. The guidance is effective for annual periods after January 1, 2028 and interim reporting periods within those annual reporting periods with early adoption permitted. The guidance can be applied prospectively, retrospectively, or via a modified prospective transition method. Edison International and SCE are currently evaluating the impact of this new guidance. In December 2025, the FASB issued an accounting standards update to establish guidance on the recognition, measurement, and presentation of government grants received by business entities. The guidance is effective in annual periods beginning after January 1, 2029 and interim periods within those annual reporting periods with early adoption permitted. The guidance can be applied on a modified prospective basis, a modified retrospective basis, or a full retrospective basis. Edison International and SCE are currently evaluating the impact of this new guidance. 70 70 70 Table of Contents Table of Contents --- ## Modified: Credit Agreements and Short-Term Debt **Key changes:** - Reworded sentence: "The following table summarizes the status of the credit facilities at December 31, 2025: (in millions, except for rates)BorrowerTermination DateSOFR plus (bps)CommitmentOutstanding borrowingsOutstanding letters of creditAmount availableEdison International Parent1, 3 May 2029128$1,500 $756 $ - $744 SCE2, 3May 20291083,350 1,038 2 2,310 Total Edison International$4,850 $1,794 $2 $3,054 Edison International Parent1, 3 SCE2, 3 1At December 31, 2025 and 2024, Edison International Parent had $754 million and $444 million outstanding commercial paper, net of discount of $2 million and $1 million, at a weighted-average interest rate of 4.58% and 4.86%, respectively." **Prior (2025):** The following table summarizes the status of the credit facilities at December 31, 2024: (in millions, except for rates)BorrowerTermination DateSOFR plus (bps)CommitmentOutstanding borrowingsOutstanding letters of creditAmount availableEdison International Parent1, 3May 2028128$1,500 $445 $ - $1,055 SCE2, 3May 20281083,350 1,260 6 2,084 Total Edison International$4,850 $1,705 $6 $3,139 Edison International Parent1, 3 SCE2, 3 1At December 31, 2024 and 2023, Edison International Parent had $444 million and $246 million outstanding commercial paper, net of discount of $1 million and zero, at a weighted-average interest rate of 4.86% and 5.82%, respectively. 2At December 31, 2024 and 2023, SCE had $1,259 million and $1,554 million outstanding commercial paper, net of discount of $1 million and $4 million, at a weighted-average interest rate of 4.95% and 5.82%, respectively. This includes $706 million and $722 million, at December 31, 2024 and 2023, respectively, outstanding commercial paper reclassified from "Short-term debt" to "Long-term debt" on the consolidated balance sheets, due to subsequent debt refinancing. 3 The aggregate maximum principal amount under the Edison International Parent and SCE revolving credit facilities may be increased up to $2.0 billion and $4.0 billion, respectively, provided that additional lender commitments are obtained. In May 2024, Edison International Parent and SCE amended their credit facilities to extend the maturity date to May 2028, with additional one-year extension options. **Current (2026):** The following table summarizes the status of the credit facilities at December 31, 2025: (in millions, except for rates)BorrowerTermination DateSOFR plus (bps)CommitmentOutstanding borrowingsOutstanding letters of creditAmount availableEdison International Parent1, 3 May 2029128$1,500 $756 $ - $744 SCE2, 3May 20291083,350 1,038 2 2,310 Total Edison International$4,850 $1,794 $2 $3,054 Edison International Parent1, 3 SCE2, 3 1At December 31, 2025 and 2024, Edison International Parent had $754 million and $444 million outstanding commercial paper, net of discount of $2 million and $1 million, at a weighted-average interest rate of 4.58% and 4.86%, respectively. 2At December 31, 2025 and 2024, SCE had $1,036 million and $1,259 million outstanding commercial paper, net of discount of $2 million and $1 million, at a weighted-average interest rate of 4.59% and 4.95%, respectively. The balance at December 31, 2024 includes $706 million outstanding commercial paper reclassified from "Short-term debt" to "Long-term debt" on the consolidated balance sheet due to subsequent debt refinancing. 3The aggregate maximum principal amount under the Edison International Parent and SCE revolving credit facilities may be increased up to $2.0 billion and $4.0 billion, respectively, provided that additional lender commitments are obtained. Term Loan In December 2025, Edison International Parent borrowed $600 million under a term loan agreement due in December 2026 with a variable interest rate based on either SOFR plus 1.25% or a base rate plus 0.25%. The proceeds were used for general corporate purposes. --- ## Modified: Consolidated Statements of Comprehensive IncomeEdison International **Key changes:** - Reworded sentence: "Years ended December 31,(in millions)202520242023Net income$4,701 $1,546 $1,407 Other comprehensive income (loss), net of tax:Pension and postretirement benefits other than pensions5 9 (1)Foreign currency translation adjustments1 - 3 Other comprehensive income, net of tax6 9 2 Comprehensive income4,707 1,555 1,409 Less: Comprehensive income attributable to noncontrolling interests144 175 123 Comprehensive income attributable to Edison International$4,563 $1,380 $1,286 The accompanying notes are an integral part of these consolidated financial statements." **Prior (2025):** Years ended December 31,(in millions)202420232022Net income$1,546 $1,407 $824 Other comprehensive income (loss), net of tax:Pension and postretirement benefits other than pensions9 (1)43 Foreign currency translation adjustments - 3 - Other comprehensive income, net of tax9 2 43 Comprehensive income1,555 1,409 867 Less: Comprehensive income attributable to noncontrolling interests175 123 107 Comprehensive income attributable to Edison International$1,380 $1,286 $760 The accompanying notes are an integral part of these consolidated financial statements. 50 50 50 Table of Contents Table of Contents **Current (2026):** Years ended December 31,(in millions)202520242023Net income$4,701 $1,546 $1,407 Other comprehensive income (loss), net of tax:Pension and postretirement benefits other than pensions5 9 (1)Foreign currency translation adjustments1 - 3 Other comprehensive income, net of tax6 9 2 Comprehensive income4,707 1,555 1,409 Less: Comprehensive income attributable to noncontrolling interests144 175 123 Comprehensive income attributable to Edison International$4,563 $1,380 $1,286 The accompanying notes are an integral part of these consolidated financial statements. 49 49 49 Table of Contents Table of Contents --- ## Modified: Note 7. Revenue **Key changes:** - Reworded sentence: "The following table is a summary of SCE's revenue:Years ended December 31,(in millions)202520242023Revenue from contracts with customers Commercial$8,215 $8,000 $7,333 Residential6,773 7,060 6,421 Other3,024 3,335 3,266 Total revenue from contracts with customer1,218,012 18,395 17,020 Alternative revenue program and other31,264 (848)(745)Total operating revenue$19,276 $17,547 $16,275 Total revenue from contracts with customer1,2 Alternative revenue program and other3 1SCE recorded CPUC revenue based on annual revenue requirement set by a methodology established in the GRC proceedings and FERC revenue authorized through a formula rate." **Prior (2025):** The following table is a summary of SCE's revenue:Years ended December 31,(in millions)202420232022Revenue from contracts with customers Commercial$8,000 $7,333 $7,028 Residential7,060 6,421 6,707 Other3,335 3,266 3,025 Total revenue from contracts with customer118,395 17,020 16,760 Alternative revenue program and other2(848)(745)412 Total operating revenue$17,547 $16,275 $17,172 Total revenue from contracts with customer1 Alternative revenue program and other2 1At December 31, 2024 and 2023, SCE's receivables related to contracts from customers were $2.9 billion and $2.5 billion, which included accrued unbilled revenue of $845 million and $741 million, respectively. 2Includes differences between revenues from contracts with customers and authorized levels for certain CPUC and FERC revenues. **Current (2026):** The following table is a summary of SCE's revenue:Years ended December 31,(in millions)202520242023Revenue from contracts with customers Commercial$8,215 $8,000 $7,333 Residential6,773 7,060 6,421 Other3,024 3,335 3,266 Total revenue from contracts with customer1,218,012 18,395 17,020 Alternative revenue program and other31,264 (848)(745)Total operating revenue$19,276 $17,547 $16,275 Total revenue from contracts with customer1,2 Alternative revenue program and other3 1SCE recorded CPUC revenue based on annual revenue requirement set by a methodology established in the GRC proceedings and FERC revenue authorized through a formula rate. For further information, see Note 1. 2At December 31, 2025 and 2024, SCE's receivables related to contracts from customers were $2.7 billion and $2.9 billion, which included accrued unbilled revenue of $1,236 million and $845 million, respectively. 3Includes differences between revenues from contracts with customers and authorized levels for certain CPUC and FERC revenues. --- ## Modified: Long-Term Debt **Key changes:** - Reworded sentence: "The following table summarizes long-term debt (rates and terms are as of December 31, 2025) of Edison International and SCE: December 31,(in millions)20252024Edison International Parent:Debentures and notes:2027 - 2054 (4.125% to 8.125%)$4,850 $5,100 Current portion of long-term debt - (800)Unamortized debt discount/premium and issuance costs, net(35)(32)Total Edison International Parent4,815 4,268 SCE:First and refunding mortgage bonds:2026 - 2055 (1.20% to 6.20%)29,200 27,400 Pollution-control bonds:2028 - 2035 (1.45% to 4.50%)752 752 Debentures and notes:2029 - 2053 (5.06% to 6.65%)306 306 Senior secured recovery bonds1:2028 - 2050 (0.86% to 5.54%)3,126 1,532 Other long-term debt2 - 706 Current portion of long-term debt(1,928)(1,249)Unamortized debt discount/premium and issuance costs, net(201)(181)Total SCE31,255 29,266 Total Edison International$36,070 $33,534 2027 - 2054 (4.125% to 8.125%) 2026 - 2055 (1.20% to 6.20%) 2028 - 2035 (1.45% to 4.50%) 2029 - 2053 (5.06% to 6.65%) Senior secured recovery bonds1: 2028 - 2050 (0.86% to 5.54%) Other long-term debt2 1The senior secured recovery bonds are payable only from and secured by the Recovery Property at SCE Recovery Funding LLC, and do not constitute a debt or other legal obligation of, or interest in, SCE or any of its affiliates, except for SCE Recovery Funding LLC." - Reworded sentence: "2Subsequent to December 31, 2024, SCE issued first and refunding mortgage bonds which were used to partially pay down its commercial paper balance." **Prior (2025):** The following table summarizes long-term debt (rates and terms are as of December 31, 2024) of Edison International and SCE: December 31,(in millions)20242023Edison International Parent and Other:Debentures and notes:2025 - 2054 (4.125% to 8.125%)$5,100 $4,550 Current portion of long-term debt(800)(500)Unamortized debt discount/premium and issuance costs, net(32)(31)Total Edison International Parent and Other4,268 4,019 SCE:First and refunding mortgage bonds:2025 - 2053 (1.20% to 6.05%)27,400 24,700 Pollution-control bonds:2028 - 2035 (1.45% to 4.50%)752 752 Debentures and notes:2029 - 2053 (5.06% to 6.65%)306 306 Senior secured recovery bonds1:2028 - 2047 (0.86% to 5.11%)1,532 1,579 Other long-term debt2706 1,322 Current portion of long-term debt(1,249)(2,197)Unamortized debt discount/premium and issuance costs, net(181)(165)Total SCE29,266 26,297 Total Edison International$33,534 $30,316 2025 - 2054 (4.125% to 8.125%) 2025 - 2053 (1.20% to 6.05%) 2028 - 2035 (1.45% to 4.50%) 2029 - 2053 (5.06% to 6.65%) Senior secured recovery bonds1: 2028 - 2047 (0.86% to 5.11%) Other long-term debt2 1The senior secured recovery bonds are payable only from and secured by the Recovery Property at SCE Recovery Funding LLC, and do not constitute a debt or other legal obligation of, or interest in, SCE or any of its affiliates, except for SCE Recovery Funding LLC. For further details, see Note 3. 2Subsequent to December 31, 2024 and 2023, SCE issued first and refunding mortgage bonds which were used to partially pay down its commercial paper balance. As a result, SCE included the paydown amount of $706 million and $722 million in other long-term debt at December 31, 2024 and 2023, respectively. The 2023 amount also includes a $600 million term loan with an interest rate of adjusted term secured overnight financing rate ("SOFR") plus 0.90% that matured in 2024. Edison International and SCE long-term debt maturities over the next five years are as follows: 76 76 76 Table of Contents Table of Contents (in millions)EdisonInternationalSCE2025$2,049 $1,249 20261,900 1,900 20272,501 1,901 20282,942 1,792 20293,363 2,313 **Current (2026):** The following table summarizes long-term debt (rates and terms are as of December 31, 2025) of Edison International and SCE: December 31,(in millions)20252024Edison International Parent:Debentures and notes:2027 - 2054 (4.125% to 8.125%)$4,850 $5,100 Current portion of long-term debt - (800)Unamortized debt discount/premium and issuance costs, net(35)(32)Total Edison International Parent4,815 4,268 SCE:First and refunding mortgage bonds:2026 - 2055 (1.20% to 6.20%)29,200 27,400 Pollution-control bonds:2028 - 2035 (1.45% to 4.50%)752 752 Debentures and notes:2029 - 2053 (5.06% to 6.65%)306 306 Senior secured recovery bonds1:2028 - 2050 (0.86% to 5.54%)3,126 1,532 Other long-term debt2 - 706 Current portion of long-term debt(1,928)(1,249)Unamortized debt discount/premium and issuance costs, net(201)(181)Total SCE31,255 29,266 Total Edison International$36,070 $33,534 2027 - 2054 (4.125% to 8.125%) 2026 - 2055 (1.20% to 6.20%) 2028 - 2035 (1.45% to 4.50%) 2029 - 2053 (5.06% to 6.65%) Senior secured recovery bonds1: 2028 - 2050 (0.86% to 5.54%) Other long-term debt2 1The senior secured recovery bonds are payable only from and secured by the Recovery Property at SCE Recovery Funding LLC, and do not constitute a debt or other legal obligation of, or interest in, SCE or any of its affiliates, except for SCE Recovery Funding LLC. For further details, see Note 3. 2Subsequent to December 31, 2024, SCE issued first and refunding mortgage bonds which were used to partially pay down its commercial paper balance. As a result, SCE included the paydown amount of $706 million in other long-term debt at December 31, 2024. Edison International and SCE long-term debt maturities over the next five years are as follows: (in millions)Edison InternationalSCE2026$1,928 $1,928 20272,538 1,938 20282,981 1,831 20293,404 2,354 20302,048 1,498 Senior Secured Recovery Bonds In December 2025, SCE Recovery Funding LLC issued $1.6 billion of Senior Secured Recovery Bonds, Series 2025-A, in three tranches ("Recovery Bonds") consisting of: $443 million, 4.45% with final maturity in 2038; $600 million, 5.34% with final maturity in 2047; and $600 million, 5.54% with final maturity in 2052. SCE used the proceeds it received from 76 76 76 Table of Contents Table of Contents the sale of Recovery Property to reimburse itself for costs approved for recovery under the TKM Settlement Agreement. For further details, see Note 3. --- ## Modified: Consolidated Balance SheetsEdison International **Key changes:** - Reworded sentence: "December 31,(in millions, except share amounts)20252024LIABILITIES AND EQUITYShort-term debt$2,390 $998 Current portion of long-term debt1,928 2,049 Accounts payable2,344 2,000 Wildfire-related claims585 60 Accrued interest473 422 Regulatory liabilities1,158 1,347 Current portion of operating lease liabilities120 124 Other current liabilities1,538 1,439 Total current liabilities10,536 8,439 Long-term debt (includes $3,022 and $1,468 related to a VIE at respective dates)36,070 33,534 Deferred income taxes and credits9,114 7,180 Pensions and benefits370 384 Asset retirement obligations2,583 2,580 Regulatory liabilities10,627 10,159 Operating lease liabilities1,041 1,056 Wildfire-related claims721 941 Other deferred credits and other long-term liabilities3,705 3,566 Total deferred credits and other liabilities28,161 25,866 Total liabilities74,767 67,839 Commitments and contingencies (Note 12)Preferred stock (50,000,000 shares authorized; 414,342 and 1,159,317 shares of Series A and 87,937 and 503,454 shares of Series B issued and outstanding at respective dates)497 1,645 Common stock, no par value (800,000,000 shares authorized; 384,787,056 and 384,784,719 shares issued and outstanding at respective dates)6,362 6,353 Accumulated other comprehensive income6 - Retained earnings10,714 7,567 Total Edison International's shareholders' equity17,579 15,565 Noncontrolling interests - preference stock of SCE1,680 2,175 Total equity19,259 17,740 Total liabilities and equity$94,026 $85,579 Long-term debt (includes $3,022 and $1,468 related to a VIE at respective dates) Preferred stock (50,000,000 shares authorized; 414,342 and 1,159,317 shares of Series A and 87,937 and 503,454 shares of Series B issued and outstanding at respective dates) Common stock, no par value (800,000,000 shares authorized; 384,787,056 and 384,784,719 shares issued and outstanding at respective dates) The accompanying notes are an integral part of these consolidated financial statements." **Prior (2025):** December 31,(in millions)20242023ASSETSCash and cash equivalents$193 $345 Receivables, less allowances of $352 and $360 for uncollectible accounts at respective dates2,169 2,016 Accrued unbilled revenue848 742 Inventory538 527 Prepaid expenses103 112 Regulatory assets2,748 2,524 Wildfire Insurance Fund contributions138 204 Other current assets418 341 Total current assets7,155 6,811 Nuclear decommissioning trusts4,286 4,173 Other investments57 54 Total investments4,343 4,227 Utility property, plant and equipment, less accumulated depreciation and amortization of $14,207 and $12,910 at respective dates59,047 55,877 Nonutility property, plant and equipment, less accumulated depreciation of $124 and $114 at respective dates207 207 Total property, plant and equipment59,254 56,084 Receivables, less allowances of $43 and $4 for uncollectible accounts at respective dates62 4 Regulatory assets (include $1,512 and $1,558 related to a Variable Interest Entity "VIE" at respective dates)8,886 8,897 Wildfire Insurance Fund contributions1,878 1,951 Operating lease right-of-use assets1,180 1,221 Long-term insurance receivables418 501 Other long-term assets2,403 2,062 Total other assets14,827 14,636 Total assets$85,579 $81,758 Receivables, less allowances of $352 and $360 for uncollectible accounts at respective dates Utility property, plant and equipment, less accumulated depreciation and amortization of $14,207 and $12,910 at respective dates Nonutility property, plant and equipment, less accumulated depreciation of $124 and $114 at respective dates Receivables, less allowances of $43 and $4 for uncollectible accounts at respective dates Regulatory assets (include $1,512 and $1,558 related to a Variable Interest Entity "VIE" at respective dates) The accompanying notes are an integral part of these consolidated financial statements. 51 51 51 Table of Contents Table of Contents **Current (2026):** December 31,(in millions)20252024ASSETSCash and cash equivalents$158 $193 Receivables, net of allowances for uncollectible accounts of $356 and $352 at respective dates1,463 2,169 Accrued unbilled revenue1,238 848 Inventory535 538 Prepaid expenses119 103 Regulatory assets3,290 2,748 Wildfire Fund contributions138 138 Other current assets745 418 Total current assets7,686 7,155 Nuclear decommissioning trusts4,535 4,286 Other investments51 57 Total investments4,586 4,343 Utility property, plant and equipment, net of accumulated depreciation and amortization of $15,060 and $14,207 at respective dates63,131 59,047 Nonutility property, plant and equipment, net of accumulated depreciation of $132 and $124 at respective dates197 207 Total property, plant and equipment63,328 59,254 Receivables, net of allowances for uncollectible accounts of $49 and $43 at respective dates38 62 Regulatory assets (include $3,092 and $1,512 related to a Variable Interest Entity ("VIE") at respective dates)12,960 8,886 Wildfire Fund contributions1,740 1,878 Operating lease right-of-use assets1,161 1,180 Long-term insurance receivables359 418 Other long-term assets2,168 2,403 Total other assets18,426 14,827 Total assets$94,026 $85,579 Receivables, net of allowances for uncollectible accounts of $356 and $352 at respective dates Utility property, plant and equipment, net of accumulated depreciation and amortization of $15,060 and $14,207 at respective dates Nonutility property, plant and equipment, net of accumulated depreciation of $132 and $124 at respective dates Receivables, net of allowances for uncollectible accounts of $49 and $43 at respective dates Regulatory assets (include $3,092 and $1,512 related to a Variable Interest Entity ("VIE") at respective dates) The accompanying notes are an integral part of these consolidated financial statements. 50 50 50 Table of Contents Table of Contents --- ## Modified: Consolidated Balance SheetsSouthern California Edison Company **Key changes:** - Reworded sentence: "December 31,(in millions, except share amounts)20252024LIABILITIES AND EQUITYShort-term debt$1,036 $553 Current portion of long-term debt1,928 1,249 Accounts payable2,353 2,078 Wildfire-related claims585 60 Accrued interest432 385 Regulatory liabilities1,158 1,347 Current portion of operating lease liabilities118 123 Other current liabilities1,599 1,495 Total current liabilities9,209 7,290 Long-term debt (includes $3,022 and $1,468 related to a VIE at respective dates)31,255 29,266 Deferred income taxes and credits10,712 8,697 Pensions and benefits87 92 Asset retirement obligations2,583 2,580 Regulatory liabilities10,627 10,159 Operating lease liabilities1,037 1,051 Wildfire-related claims721 941 Other deferred credits and other long-term liabilities3,684 3,518 Total deferred credits and other liabilities29,451 27,038 Total liabilities69,915 63,594 Commitments and contingencies (Note 12)Preference stock1,714 2,220 Common stock, no par value (560,000,000 shares authorized; 434,888,104 shares issued and outstanding at respective dates)2,168 2,168 Additional paid-in capital8,970 8,950 Accumulated other comprehensive loss(12)(9)Retained earnings11,090 8,422 Total equity23,930 21,751 Total liabilities and equity$93,845 $85,345 Long-term debt (includes $3,022 and $1,468 related to a VIE at respective dates) Common stock, no par value (560,000,000 shares authorized; 434,888,104 shares issued and outstanding at respective dates) The accompanying notes are an integral part of these consolidated financial statements." **Prior (2025):** December 31,(in millions)20242023ASSETSCash and cash equivalents$78 $214 Receivables, less allowances of $347 and $360 for uncollectible accounts at respective dates2,160 1,981 Accrued unbilled revenue845 741 Inventory538 527 Prepaid expenses102 111 Regulatory assets2,748 2,524 Wildfire Insurance Fund contributions138 204 Other current assets415 331 Total current assets7,024 6,633 Nuclear decommissioning trusts4,286 4,173 Other investments38 38 Total investments4,324 4,211 Utility property, plant and equipment, less accumulated depreciation and amortization of $14,207 and $12,910 at respective dates59,047 55,877 Nonutility property, plant and equipment, less accumulated depreciation of $108 and $100 at respective dates199 201 Total property, plant and equipment59,246 56,078 Receivables, less allowances of $43 and $4 for uncollectible accounts at respective dates62 4 Regulatory assets (include $1,512 and $1,558 related to a VIE at respective dates)8,886 8,897 Wildfire Insurance Fund contributions1,878 1,951 Operating lease right-of-use assets1,174 1,214 Long-term insurance receivables131 157 Long-term insurance receivables due from affiliate303 355 Other long-term assets2,317 1,983 Total other assets14,751 14,561 Total assets$85,345 $81,483 Receivables, less allowances of $347 and $360 for uncollectible accounts at respective dates Utility property, plant and equipment, less accumulated depreciation and amortization of $14,207 and $12,910 at respective dates Nonutility property, plant and equipment, less accumulated depreciation of $108 and $100 at respective dates Receivables, less allowances of $43 and $4 for uncollectible accounts at respective dates Regulatory assets (include $1,512 and $1,558 related to a VIE at respective dates) The accompanying notes are an integral part of these consolidated financial statements. 57 57 57 Table of Contents Table of Contents **Current (2026):** December 31,(in millions)20252024ASSETSCash and cash equivalents$98 $78 Receivables, net of allowances for uncollectible accounts of $353 and $347 at respective dates1,455 2,160 Accrued unbilled revenue1,236 845 Inventory535 538 Prepaid expenses118 102 Regulatory assets3,290 2,748 Wildfire Fund contributions138 138 Other current assets743 415 Total current assets7,613 7,024 Nuclear decommissioning trusts4,535 4,286 Other investments40 38 Total investments4,575 4,324 Utility property, plant and equipment, net of accumulated depreciation and amortization of $15,060 and $14,207 at respective dates63,131 59,047 Nonutility property, plant and equipment, net of accumulated depreciation of $113 and $108 at respective dates188 199 Total property, plant and equipment63,319 59,246 Receivables, net of allowances for uncollectible accounts of $49 and $43 at respective dates38 62 Regulatory assets (include $3,092 and $1,512 related to a VIE at respective dates)12,960 8,886 Wildfire Fund contributions1,740 1,878 Operating lease right-of-use assets1,155 1,174 Long-term insurance receivables145 131 Long-term insurance receivables due from affiliate226 303 Other long-term assets2,074 2,317 Total other assets18,338 14,751 Total assets$93,845 $85,345 Receivables, net of allowances for uncollectible accounts of $353 and $347 at respective dates Utility property, plant and equipment, net of accumulated depreciation and amortization of $15,060 and $14,207 at respective dates Nonutility property, plant and equipment, net of accumulated depreciation of $113 and $108 at respective dates Receivables, net of allowances for uncollectible accounts of $49 and $43 at respective dates Regulatory assets (include $3,092 and $1,512 related to a VIE at respective dates) The accompanying notes are an integral part of these consolidated financial statements. 56 56 56 Table of Contents Table of Contents --- ## Modified: Cash and Cash Equivalents and Restricted Cash and Cash Equivalents **Key changes:** - Reworded sentence: "The following table sets forth the cash, cash equivalents, restricted cash and restricted cash equivalents included in the consolidated statements of cash flows: Edison InternationalSCEDecember 31,(in millions)2025202420252024Cash and cash equivalents1$158 $193 $98 $78 Short-term restricted cash and cash equivalents2552 40 549 36 Long-term restricted cash and cash equivalents310 451 10 451 Total cash and cash equivalents and restricted cash and cash equivalents$720 $684 $657 $565 Cash and cash equivalents1 Short-term restricted cash and cash equivalents2 Long-term restricted cash and cash equivalents3 1Cash equivalents consist of investments in money market funds." - Reworded sentence: "2Includes SCE Recovery Funding LLC's restricted cash for payments of senior secured recovery bonds and cash collected for customer-funded wildfire self-insurance related to settlements (see Note 12 for further information)." **Prior (2025):** Cash equivalents consist of investments in money market funds. Generally, the carrying value of cash equivalents equals the fair value, as these investments have original maturities of three months or less. The cash equivalents were as follows: Edison InternationalSCEDecember 31,(in millions)2024202320242023Money market funds$101 $199 $ - $78 Cash is temporarily invested until required for check clearing. Checks issued, but not yet paid by the financial institution, are reclassified from cash to accounts payable at the end of each reporting period. The following table sets forth the cash, cash equivalents and restricted cash included in the consolidated statements of cash flows: December 31,(in millions)20242023Edison International:Cash and cash equivalents$193 $345 Short-term restricted cash140 35 Long-term restricted cash2451 152 Total cash, cash equivalents and restricted cash$684 $532 SCE:Cash and cash equivalents$78 $214 Short-term restricted cash136 33 Long-term restricted cash2451 151 Total cash, cash equivalents and restricted cash$565 $398 Short-term restricted cash1 Short-term restricted cash1 Short-term restricted cash 1 Long-term restricted cash2 Long-term restricted cash2 Long-term restricted cash 2 Short-term restricted cash1 Short-term restricted cash1 Short-term restricted cash 1 Long-term restricted cash2 Long-term restricted cash2 Long-term restricted cash 2 1Includes SCE Recovery Funding LLC's restricted cash for payments of senior secured recovery bonds and is reflected in "Other current assets" on Edison International's and SCE's consolidated balance sheets. 2The SCE amount represents cash collected for customer-funded wildfire self-insurance and is reflected in "Other long-term assets" on Edison International's and SCE's consolidated balance sheets. See Note 12 for further information. **Current (2026):** The following table sets forth the cash, cash equivalents, restricted cash and restricted cash equivalents included in the consolidated statements of cash flows: Edison InternationalSCEDecember 31,(in millions)2025202420252024Cash and cash equivalents1$158 $193 $98 $78 Short-term restricted cash and cash equivalents2552 40 549 36 Long-term restricted cash and cash equivalents310 451 10 451 Total cash and cash equivalents and restricted cash and cash equivalents$720 $684 $657 $565 Cash and cash equivalents1 Short-term restricted cash and cash equivalents2 Long-term restricted cash and cash equivalents3 1Cash equivalents consist of investments in money market funds. Generally, the carrying value of cash equivalents equals the fair value, as these investments have original maturities of three months or less. 2Includes SCE Recovery Funding LLC's restricted cash for payments of senior secured recovery bonds and cash collected for customer-funded wildfire self-insurance related to settlements (see Note 12 for further information). Both are reflected in "Other current assets" on Edison International's and SCE's consolidated balance sheets. 3Represents cash collected for customer-funded wildfire self-insurance and is reflected in "Other long-term assets" on Edison International's and SCE's consolidated balance sheets. See Note 12 for further information. 3 --- ## Modified: Current and Deferred Taxes **Key changes:** - Reworded sentence: "The components of income tax expense (benefit) by location of taxing jurisdiction are: Edison InternationalSCEYears ended December 31,(in millions)202520242023202520242023Current:Federal$ - $1 $ - $28 $3 $ - State83 7 - 99 48 5 83 8 - 127 51 5 Deferred:Federal925 59 101976 118 149 State308 (50)7 337 (49)30 1,233 9 1081,313 69 179 Tax Credits(25) - - (25) - - Total$1,291 $17 $108$1,415 $120 $184 Tax Credits The components of net accumulated deferred income tax liability are: Edison InternationalSCEDecember 31,(in millions)2025202420252024Deferred tax assets:Property$1,005 $943 $992 $929 Wildfire-related1339 254 336 251 Nuclear decommissioning trust assets in excess of nuclear ARO liability455 373 455 373 Loss and credit carryforwards23,246 3,703 1,702 2,242 Regulatory balances600 610 600 610 Pension and postretirement benefits other than pensions, net115 117 21 21 Leases331 335 331 335 Other199 177 188 167 Sub-total6,290 6,512 4,625 4,928 Less: valuation allowance314 17 - - Total6,276 6,495 4,625 4,928 Deferred tax liabilities:Property11,618 11,220 11,598 11,202 Regulatory balances2,551 1,299 2,551 1,299 Nuclear decommissioning trust assets455 373 455 373 Leases331 335 331 335 Other195 187 162 155 Total15,150 13,414 15,097 13,364 Accumulated deferred income tax liability, net4$8,874 $6,919 $10,472 $8,436 Wildfire-related1 Loss and credit carryforwards2 Less: valuation allowance3 Accumulated deferred income tax liability, net4 80 80 80 Table of Contents Table of Contents 1Relates to estimated losses accrual for wildfire-related claims, net of expected insurance and regulatory recoveries, and contributions to the Wildfire Fund." - Reworded sentence: "2As of December 31, 2025, unrecognized tax benefits of $404 million and $326 million for Edison International and SCE, respectively, are presented net against the deferred tax asset for the loss and tax credit carryforwards." - Removed sentence: "80 80 80 Table of Contents Table of Contents" **Prior (2025):** The components of income tax expense (benefit) by location of taxing jurisdiction are: Edison InternationalSCEYears ended December 31,(in millions)202420232022202420232022Current:Federal$1 $ - $2 $3 $ - $ - State7 - 13 48 5 2 8 - 15 51 5 2 Deferred:Federal59 101 (103)118 149 (44)State(50)7 (74)(49)30 (67)9 108 (177)69 179 (111)Total$17 $108 $(162)$120 $184 $(109) 79 79 79 Table of Contents Table of Contents The components of net accumulated deferred income tax liability are: Edison InternationalSCEDecember 31,(in millions)2024202320242023Deferred tax assets:Property$943 $894 $929 $877 Wildfire-related1254 356 251 354 Nuclear decommissioning trust assets in excess of nuclear ARO liability373 380 373 380 Loss and credit carryforwards23,703 3,486 2,242 2,103 Regulatory balances610 626 610 626 Pension and postretirement benefits other than pensions, net117 127 21 25 Leases335 345 335 345 Other177 159 167 147 Sub-total6,512 6,373 4,928 4,857 Less: valuation allowance317 17 - - Total6,495 6,356 4,928 4,857 Deferred tax liabilities:Property11,220 10,627 11,202 10,611 Regulatory balances1,299 1,450 1,299 1,450 Nuclear decommissioning trust assets373 380 373 380 Leases335 345 335 345 Other187 187 155 158 Total13,414 12,989 13,364 12,944 Accumulated deferred income tax liability, net4$6,919 $6,633 $8,436 $8,087 Wildfire-related1 Loss and credit carryforwards2 Less: valuation allowance3 Accumulated deferred income tax liability, net4 1Relates to estimated losses accrual for wildfire-related claims, net of expected recoveries from insurance and FERC customers, and contributions to the Wildfire Insurance Fund. For further information, see Note 12 and Note 1. 2As of December 31, 2024, unrecognized tax benefits of $397 million and $327 million for Edison International and SCE, respectively, are presented net against the deferred tax asset for the loss and tax credit carryforwards. As of December 31, 2023, the unrecognized tax benefits netted against deferred tax assets and tax credit carryforwards were $363 million and $299 million for Edison International and SCE, respectively. 3As of December 31, 2024 and 2023, Edison International has recorded $17 million valuation allowance on deferred tax assets. The $17 million valuation allowance is related to non-California state net operating loss carryforwards which are expected to expire before being utilized. 4Included in "Deferred income taxes and credits" on the consolidated balance sheets. 80 80 80 Table of Contents Table of Contents **Current (2026):** The components of income tax expense (benefit) by location of taxing jurisdiction are: Edison InternationalSCEYears ended December 31,(in millions)202520242023202520242023Current:Federal$ - $1 $ - $28 $3 $ - State83 7 - 99 48 5 83 8 - 127 51 5 Deferred:Federal925 59 101976 118 149 State308 (50)7 337 (49)30 1,233 9 1081,313 69 179 Tax Credits(25) - - (25) - - Total$1,291 $17 $108$1,415 $120 $184 Tax Credits The components of net accumulated deferred income tax liability are: Edison InternationalSCEDecember 31,(in millions)2025202420252024Deferred tax assets:Property$1,005 $943 $992 $929 Wildfire-related1339 254 336 251 Nuclear decommissioning trust assets in excess of nuclear ARO liability455 373 455 373 Loss and credit carryforwards23,246 3,703 1,702 2,242 Regulatory balances600 610 600 610 Pension and postretirement benefits other than pensions, net115 117 21 21 Leases331 335 331 335 Other199 177 188 167 Sub-total6,290 6,512 4,625 4,928 Less: valuation allowance314 17 - - Total6,276 6,495 4,625 4,928 Deferred tax liabilities:Property11,618 11,220 11,598 11,202 Regulatory balances2,551 1,299 2,551 1,299 Nuclear decommissioning trust assets455 373 455 373 Leases331 335 331 335 Other195 187 162 155 Total15,150 13,414 15,097 13,364 Accumulated deferred income tax liability, net4$8,874 $6,919 $10,472 $8,436 Wildfire-related1 Loss and credit carryforwards2 Less: valuation allowance3 Accumulated deferred income tax liability, net4 80 80 80 Table of Contents Table of Contents 1Relates to estimated losses accrual for wildfire-related claims, net of expected insurance and regulatory recoveries, and contributions to the Wildfire Fund. For further information, see Note 12 and Note 1. 2As of December 31, 2025, unrecognized tax benefits of $404 million and $326 million for Edison International and SCE, respectively, are presented net against the deferred tax asset for the loss and tax credit carryforwards. As of December 31, 2024, the unrecognized tax benefits netted against deferred tax assets and tax credit carryforwards were $397 million and $327 million for Edison International and SCE, respectively. 3As of December 31, 2025 and 2024, Edison International has recorded $14 million and $17 million valuation allowance on deferred tax assets. The valuation allowance is related to non-California state net operating loss carryforwards which are expected to expire before being utilized. 4Included in "Deferred income taxes and credits" on the consolidated balance sheets. --- ## Modified: Note 2. Property, Plant and Equipment **Key changes:** - Reworded sentence: "SCE's utility property, plant and equipment included in the consolidated balance sheets is composed of the following: December 31,(in millions)20252024Distribution$39,776 $37,093 Transmission19,959 19,189 Generation4,297 4,217 General plant and other7,309 7,046 Accumulated depreciation(15,060)(14,207)56,281 53,338 Construction work in progress16,720 5,585 Nuclear fuel, at amortized cost130 124 Total utility property, plant and equipment$63,131 $59,047 Construction work in progress1 1Includes $996 million and $611 million of capitalized software costs at December 31, 2025 and 2024, respectively." **Prior (2025):** SCE's utility property, plant and equipment included in the consolidated balance sheets is composed of the following: December 31,(in millions)20242023Distribution$37,093 $34,573 Transmission19,189 18,526 Generation4,217 3,593 General plant and other7,046 6,383 Accumulated depreciation(14,207)(12,910)53,338 50,165 Construction work in progress5,585 5,590 Nuclear fuel, at amortized cost124 122 Total utility property, plant and equipment$59,047 $55,877 **Current (2026):** SCE's utility property, plant and equipment included in the consolidated balance sheets is composed of the following: December 31,(in millions)20252024Distribution$39,776 $37,093 Transmission19,959 19,189 Generation4,297 4,217 General plant and other7,309 7,046 Accumulated depreciation(15,060)(14,207)56,281 53,338 Construction work in progress16,720 5,585 Nuclear fuel, at amortized cost130 124 Total utility property, plant and equipment$63,131 $59,047 Construction work in progress1 1Includes $996 million and $611 million of capitalized software costs at December 31, 2025 and 2024, respectively. --- ## Modified: SCE will not benefit from all of the features of the California Wildfire Legislation if the Wildfire Fund is exhausted. **Key changes:** - Reworded sentence: "Catastrophic wildfires could rapidly exhaust the Wildfire Fund and SCE will not be reimbursed by the Wildfire Fund or benefit from the Liability Cap if the fund has been exhausted as a result of damage claims previously incurred by SCE or the other participating utilities." **Prior (2025):** Catastrophic wildfires could rapidly exhaust the Wildfire Insurance Fund and SCE will not be reimbursed by the Wildfire Insurance Fund or benefit from the AB 1054 Liability Cap if the fund has been exhausted as a result of damage claims previously incurred by SCE or the other participating utilities. AB 1054 does not have a mechanism for adding to or replenishing the Wildfire Insurance Fund. For more information on AB 1054, see "Business - Southern California Wildfires and Mudslides - Recovery of Wildfire-Related Costs - 2019 Wildfire Legislation." **Current (2026):** Catastrophic wildfires could rapidly exhaust the Wildfire Fund and SCE will not be reimbursed by the Wildfire Fund or benefit from the Liability Cap if the fund has been exhausted as a result of damage claims previously incurred by SCE or the other participating utilities. For more information on the California Wildfire Legislation , see "Business - Southern California Wildfires and Mudslides - Recovery of Wildfire-Related Costs - California Wildfire Legislation." --- ## Modified: Consolidated Statements of Cash FlowsEdison International **Key changes:** - Reworded sentence: "Years ended December 31,(in millions)202520242023Cash flows from operating activities:Net income$4,701 $1,546 $1,407 Adjustments to reconcile to net cash provided by operating activities:Depreciation and amortization3,237 2,866 2,635 Equity allowance for funds used during construction(189)(187)(157)Asset impairment 106 - 1 Deferred income taxes1,208 9 108 Wildfire Fund amortization expense144 146 213 Other176 154 143 Nuclear decommissioning trusts(123)(174)(180)Contributions to Wildfire Fund(95)(95)(95)Changes in operating assets and liabilities:Receivables662 (278)(349)Inventory(4)(14)(63)Accounts payable78 53 (408)Other current assets and liabilities(253)(85)194 Derivative assets and liabilities, net(11)28 (174)Regulatory assets and liabilities, net(3,445)1,219 576 Wildfire-related claims, net of insurance recoveries(610)(314)(446)Other noncurrent assets and liabilities218 140 (4)Net cash provided by operating activities5,800 5,014 3,401 Cash flows from financing activities:Long-term debt issued, net of discount and issuance costs of $60, $44, and $54 for the respective years5,133 5,256 5,121 Long-term debt repaid(2,052)(2,701)(2,498)Short-term debt issued1,260 - 1,076 Short-term debt repaid(230)(401)(2,407)Common stock repurchased(32)(200) - Preferred and preference stock issued, net of issuance cost - 345 542 Preferred and preference stock repurchased and redeemed(1,664)(656)(289)Commercial paper (repayments) borrowing, net(346)308 1,102 Dividends and distribution to noncontrolling interests(136)(168)(117)Common stock dividends paid(1,274)(1,198)(1,112)Preferred stock dividends paid(104)(88)(108)Other16 177 137 Net cash provided by financing activities571 674 1,447 Cash flows from investing activities:Capital expenditures(6,515)(5,707)(5,448)Proceeds from sale of nuclear decommissioning trust investments6,219 5,019 4,597 Purchases of nuclear decommissioning trust investments(6,098)(4,898)(4,417)Other59 50 35 Net cash used in investing activities(6,335)(5,536)(5,233)Net increase (decrease) in cash and cash equivalents and restricted cash and cash equivalents36 152 (385)Cash and cash equivalents and restricted cash and cash equivalents at beginning of year684 532 917 Cash and cash equivalents and restricted cash and cash equivalents at end of year$720 $684 $532 Long-term debt issued, net of discount and issuance costs of $60, $44, and $54 for the respective years The accompanying notes are an integral part of these consolidated financial statements." **Prior (2025):** Years ended December 31,(in millions)202420232022Cash flows from operating activities:Net income$1,546 $1,407 $824 Adjustments to reconcile to net cash provided by operating activities:Depreciation and amortization2,939 2,721 2,633 Allowance for equity during construction(187)(157)(137)Impairment, net of other operating income - 1 49 Deferred income taxes9 108 (177)Wildfire Insurance Fund amortization expense146 213 214 Other81 57 80 Nuclear decommissioning trusts(174)(180)(123)Contributions to Wildfire Insurance Fund(95)(95)(95)Changes in operating assets and liabilities:Receivables(278)(349)(252)Inventory(14)(63)(58)Accounts payable53 (408)367 Tax receivables and payables(43)9 18 Other current assets and liabilities(42)185 207 Derivative assets and liabilities, net28 (174)115 Regulatory assets and liabilities, net1,219 576 (51)Wildfire-related insurance receivable83 (36)(390)Wildfire-related claims(397)(410)(56)Other noncurrent assets and liabilities140 (4)48 Net cash provided by operating activities5,014 3,401 3,216 Cash flows from financing activities:Long-term debt issued, net of discount and issuance costs of $44, $54, and $62 for the respective years5,256 5,121 5,971 Long-term debt repaid(2,701)(2,498)(1,085)Short-term debt issued - 1,076 1,000 Short-term debt repaid(401)(2,407)(1,543)Common stock repurchased(200) - - Preferred and preference stock issued, net of issuance cost345 542 - Preferred and preference stock repurchased and redeemed(656)(289) - Commercial paper borrowing (repayments), net308 1,102 (317)Dividends and distribution to noncontrolling interests(168)(117)(110)Common stock dividends paid(1,198)(1,112)(1,050)Preferred stock dividends paid(88)(108)(99)Other177 137 114 Net cash provided by financing activities674 1,447 2,881 Cash flows from investing activities:Capital expenditures(5,707)(5,448)(5,778)Proceeds from sale of nuclear decommissioning trust investments5,019 4,597 4,177 Purchases of nuclear decommissioning trust investments(4,898)(4,417)(4,054)Other50 35 81 Net cash used in investing activities(5,536)(5,233)(5,574)Net increase (decrease) in cash, cash equivalents and restricted cash152 (385)523 Cash, cash equivalents and restricted cash at beginning of year532 917 394 Cash, cash equivalents and restricted cash at end of year$684 $532 $917 Long-term debt issued, net of discount and issuance costs of $44, $54, and $62 for the respective years The accompanying notes are an integral part of these consolidated financial statements. 53 53 53 Table of Contents Table of Contents **Current (2026):** Years ended December 31,(in millions)202520242023Cash flows from operating activities:Net income$4,701 $1,546 $1,407 Adjustments to reconcile to net cash provided by operating activities:Depreciation and amortization3,237 2,866 2,635 Equity allowance for funds used during construction(189)(187)(157)Asset impairment 106 - 1 Deferred income taxes1,208 9 108 Wildfire Fund amortization expense144 146 213 Other176 154 143 Nuclear decommissioning trusts(123)(174)(180)Contributions to Wildfire Fund(95)(95)(95)Changes in operating assets and liabilities:Receivables662 (278)(349)Inventory(4)(14)(63)Accounts payable78 53 (408)Other current assets and liabilities(253)(85)194 Derivative assets and liabilities, net(11)28 (174)Regulatory assets and liabilities, net(3,445)1,219 576 Wildfire-related claims, net of insurance recoveries(610)(314)(446)Other noncurrent assets and liabilities218 140 (4)Net cash provided by operating activities5,800 5,014 3,401 Cash flows from financing activities:Long-term debt issued, net of discount and issuance costs of $60, $44, and $54 for the respective years5,133 5,256 5,121 Long-term debt repaid(2,052)(2,701)(2,498)Short-term debt issued1,260 - 1,076 Short-term debt repaid(230)(401)(2,407)Common stock repurchased(32)(200) - Preferred and preference stock issued, net of issuance cost - 345 542 Preferred and preference stock repurchased and redeemed(1,664)(656)(289)Commercial paper (repayments) borrowing, net(346)308 1,102 Dividends and distribution to noncontrolling interests(136)(168)(117)Common stock dividends paid(1,274)(1,198)(1,112)Preferred stock dividends paid(104)(88)(108)Other16 177 137 Net cash provided by financing activities571 674 1,447 Cash flows from investing activities:Capital expenditures(6,515)(5,707)(5,448)Proceeds from sale of nuclear decommissioning trust investments6,219 5,019 4,597 Purchases of nuclear decommissioning trust investments(6,098)(4,898)(4,417)Other59 50 35 Net cash used in investing activities(6,335)(5,536)(5,233)Net increase (decrease) in cash and cash equivalents and restricted cash and cash equivalents36 152 (385)Cash and cash equivalents and restricted cash and cash equivalents at beginning of year684 532 917 Cash and cash equivalents and restricted cash and cash equivalents at end of year$720 $684 $532 Long-term debt issued, net of discount and issuance costs of $60, $44, and $54 for the respective years The accompanying notes are an integral part of these consolidated financial statements. 52 52 52 Table of Contents Table of Contents --- ## Modified: Consolidated Statements of Comprehensive Income **Key changes:** - Reworded sentence: "Years ended December 31,(in millions)202520242023Net income$5,033 $1,794 $1,597 Other comprehensive (loss) income, net of tax:Pension and postretirement benefits other than pensions(3)3 (4)Other comprehensive (loss) income, net of tax(3)3 (4)Comprehensive income$5,030 $1,797 $1,593 The accompanying notes are an integral part of these consolidated financial statements." **Prior (2025):** Years ended December 31,(in millions)202420232022Net income$1,794 $1,597 $954 Other comprehensive income (loss), net of tax:Pension and postretirement benefits other than pensions3 (4)24 Other comprehensive income (loss), net of tax3 (4)24 Comprehensive income$1,797 $1,593 $978 The accompanying notes are an integral part of these consolidated financial statements. 56 56 56 Table of Contents Table of Contents **Current (2026):** Years ended December 31,(in millions)202520242023Net income$5,033 $1,794 $1,597 Other comprehensive (loss) income, net of tax:Pension and postretirement benefits other than pensions(3)3 (4)Other comprehensive (loss) income, net of tax(3)3 (4)Comprehensive income$5,030 $1,797 $1,593 The accompanying notes are an integral part of these consolidated financial statements. 55 55 55 Table of Contents Table of Contents --- ## Modified: Effective Tax Rate **Key changes:** - Reworded sentence: "The table below provides a reconciliation of income tax expense computed at the federal statutory income tax rate to the income tax provision: Edison InternationalSCEYears ended December 31,202520242023202520242023(in millions)Amount%Amount%Amount%Amount%Amount%Amount%Income from operations before income taxes$5,992 $1,563 $1,515 $6,448 $1,914 $1,781 Federal Statutory Tax Rate$1,258 21.0%$328 21.0%$318 21.0%$1,354 21.0%$402 21.0%$374 21.0%State Income Taxes, Net of Federal Income Tax Effect1308 5.1%(24)(1.5)%3 0.2%342 5.3% - - %23 1.3%Tax Credits(25)(0.4)% - - % - - %(25)(0.4)% - - % - - %Other AdjustmentsProperty-related(251)(4.2)%(279)(17.9)%(205)(13.5)%(251)(3.9)%(279)(14.6)%(205)(11.5)%Other1 - %(8)(0.5)%(8)(0.6)%(5)(0.1)%(3)(0.1)%(8)(0.5)%Effective Tax Rate$1,291 21.5%$17 1.1%$108 7.1%$1,415 21.9%$120 6.3%$184 10.3% Federal Statutory Tax Rate Federal Statutory Tax Rate Federal Statutory Tax Rate Federal Statutory Tax Rate State Income Taxes, Net of Federal Income Tax Effect1 Tax Credits Other Adjustments Property-related Other Effective Tax Rate 1State taxes in California represents substantially all of the tax effect in this category." - Reworded sentence: "The IRA imposes a 15% corporate alternative minimum tax ("CAMT") on adjusted financial statement income ("AFSI") of corporations with average AFSI exceeding $1.0 billion over the three preceding calendar years." **Prior (2025):** The table below provides a reconciliation of income tax expense computed at the federal statutory income tax rate to the income tax provision: Edison InternationalSCEYears ended December 31,(in millions)202420232022202420232022Income from operations before income taxes$1,563 $1,515 $662 $1,914 $1,781 $845 Provision for income tax at federal statutory rate of 21%328 318 139 402 374 177 (Decrease) increase in income tax from:State tax, net of federal income tax effect(24)3 (70) - 23 (57)Property-related(279)(205)(219)(279)(205)(219)Corporate-owned life insurance cash surrender value(9)(8)(9)(9)(8)(9)Other1 - (3)6 - (1)Total income tax expense (benefit)$17 $108 $(162)$120 $184 $(109)Effective tax rate1.1 %7.1 %(24.5)%6.3 %10.3 %(12.9)% Provision for income tax at federal statutory rate of 21% The CPUC requires flow-through ratemaking treatment for the current tax benefit arising from certain property-related and other temporary differences which reverse over time. Flow-through items reduce current authorized revenue requirements in SCE's rate cases and result in a regulatory asset for recovery of deferred income taxes in future periods. The difference between the authorized amounts as determined in SCE's rate cases, adjusted for balancing and memorandum account activities, and the recorded flow-through items also result in increases or decreases in regulatory assets with a corresponding impact on the effective tax rate to the extent that recorded deferred amounts are expected to be recovered in future rates. For further information, see Note 11. In the third quarter of 2024, SCE generated an investment tax credit of approximately $231 million, primarily from 200MW and 112.5MW utility owned storage projects. The tax benefits associated with these credits will be recognized and returned to customers as the credits are utilized. 81 81 81 Table of Contents Table of Contents Under the Inflation Reduction Act of 2022, 15% corporate alternative minimum tax ("CAMT") is imposed on corporations with average adjusted financial statement income exceeding $1.0 billion over a specified 3-year period. Both Edison International and SCE are not subject to CAMT in 2024. **Current (2026):** The table below provides a reconciliation of income tax expense computed at the federal statutory income tax rate to the income tax provision: Edison InternationalSCEYears ended December 31,202520242023202520242023(in millions)Amount%Amount%Amount%Amount%Amount%Amount%Income from operations before income taxes$5,992 $1,563 $1,515 $6,448 $1,914 $1,781 Federal Statutory Tax Rate$1,258 21.0%$328 21.0%$318 21.0%$1,354 21.0%$402 21.0%$374 21.0%State Income Taxes, Net of Federal Income Tax Effect1308 5.1%(24)(1.5)%3 0.2%342 5.3% - - %23 1.3%Tax Credits(25)(0.4)% - - % - - %(25)(0.4)% - - % - - %Other AdjustmentsProperty-related(251)(4.2)%(279)(17.9)%(205)(13.5)%(251)(3.9)%(279)(14.6)%(205)(11.5)%Other1 - %(8)(0.5)%(8)(0.6)%(5)(0.1)%(3)(0.1)%(8)(0.5)%Effective Tax Rate$1,291 21.5%$17 1.1%$108 7.1%$1,415 21.9%$120 6.3%$184 10.3% Federal Statutory Tax Rate Federal Statutory Tax Rate Federal Statutory Tax Rate Federal Statutory Tax Rate State Income Taxes, Net of Federal Income Tax Effect1 Tax Credits Other Adjustments Property-related Other Effective Tax Rate 1State taxes in California represents substantially all of the tax effect in this category. The CPUC requires flow-through ratemaking treatment for the current tax benefit arising from certain property-related and other temporary differences which reverse over time. Flow-through items reduce current authorized revenue requirements in SCE's rate cases and result in a regulatory asset for recovery of deferred income taxes in future periods. The difference between the authorized amounts as determined in SCE's rate cases, adjusted for balancing and memorandum account activities, and the recorded flow-through items also result in increases or decreases in regulatory assets with a corresponding impact on the effective tax rate to the extent that recorded deferred amounts are expected to be recovered in future rates. For further information, see Note 11. The IRA imposes a 15% corporate alternative minimum tax ("CAMT") on adjusted financial statement income ("AFSI") of corporations with average AFSI exceeding $1.0 billion over the three preceding calendar years. The CAMT was effective beginning January 1, 2023. Based on the current interpretation of the law and historical financial data, Edison International estimates that it will exceed the $1.0 billion threshold and be subject to CAMT on its consolidated federal tax returns beginning in 2026. SCE will also be subject to CAMT in 2026. Under the IRA, SCE generated investment tax credits of approximately $231 million in 2024 related to utility owned storage projects and $29 million in nuclear production tax credits. In 2025, SCE monetized the majority of these credits for $236 million. SCE expects to pass the proceeds, net of transaction fees, back to customers. --- ## Modified: Consolidated Statements of IncomeEdison International **Key changes:** - Reworded sentence: "Years ended December 31,(in millions, except per-share amounts)202520242023Operating revenue$19,317 $17,599 $16,338 Purchased power and fuel4,933 5,209 5,486 Operation and maintenance5,098 5,172 4,138 Wildfire-related claims, net of (recoveries)(1,959)652 667 Wildfire Fund expense144 146 213 Depreciation and amortization3,237 2,866 2,635 Property and other taxes665 624 571 Asset impairment106 - 1 Total operating expenses12,224 14,669 13,711 Operating income7,093 2,930 2,627 Interest expense(1,539)(1,869)(1,612)Other income, net438 502 500 Income before income taxes5,992 1,563 1,515 Income tax expense1,291 17 108 Net income4,701 1,546 1,407 Less: Preference stock dividend requirements of SCE144 175 123 Preferred stock dividend requirements of Edison International98 87 87 Net income available to Edison International common shareholders4,459 1,284 1,197 Basic earnings per share:Weighted average shares of common stock outstanding385386383Basic earnings per common share available to Edison International common shareholders$11.58$3.33$3.12Diluted earnings per share:Weighted average shares of common stock outstanding, including effect of dilutive securities386388385Diluted earnings per common share available to Edison International common shareholders$11.55$3.31$3.11 The accompanying notes are an integral part of these consolidated financial statements." **Prior (2025):** Years ended December 31,(in millions, except per-share amounts)202420232022Operating revenue$17,599 $16,338 $17,220 Purchased power and fuel5,209 5,486 6,375 Operation and maintenance5,172 4,138 4,724 Wildfire-related claims, net of insurance recoveries652 667 1,313 Wildfire Insurance Fund expense146 213 214 Depreciation and amortization2,866 2,635 2,561 Property and other taxes624 571 501 Impairment, net of other operating income - 1 49 Total operating expenses14,669 13,711 15,737 Operating income2,930 2,627 1,483 Interest expense(1,869)(1,612)(1,169)Other income, net502 500 348 Income before income taxes1,563 1,515 662 Income tax expense (benefit)17 108 (162)Net income1,546 1,407 824 Less: Preference stock dividend requirements of SCE175 123 107 Preferred stock dividend requirements of Edison International87 87 105 Net income available to Edison International common shareholders1,284 1,197 612 Basic earnings per share:Weighted average shares of common stock outstanding386383381Basic earnings per common share available to Edison International common shareholders$3.33$3.12$1.61Diluted earnings per share:Weighted average shares of common stock outstanding, including effect of dilutive securities388385383Diluted earnings per common share available to Edison International common shareholders$3.31$3.11$1.60 The accompanying notes are an integral part of these consolidated financial statements. 49 49 49 Table of Contents Table of Contents **Current (2026):** Years ended December 31,(in millions, except per-share amounts)202520242023Operating revenue$19,317 $17,599 $16,338 Purchased power and fuel4,933 5,209 5,486 Operation and maintenance5,098 5,172 4,138 Wildfire-related claims, net of (recoveries)(1,959)652 667 Wildfire Fund expense144 146 213 Depreciation and amortization3,237 2,866 2,635 Property and other taxes665 624 571 Asset impairment106 - 1 Total operating expenses12,224 14,669 13,711 Operating income7,093 2,930 2,627 Interest expense(1,539)(1,869)(1,612)Other income, net438 502 500 Income before income taxes5,992 1,563 1,515 Income tax expense1,291 17 108 Net income4,701 1,546 1,407 Less: Preference stock dividend requirements of SCE144 175 123 Preferred stock dividend requirements of Edison International98 87 87 Net income available to Edison International common shareholders4,459 1,284 1,197 Basic earnings per share:Weighted average shares of common stock outstanding385386383Basic earnings per common share available to Edison International common shareholders$11.58$3.33$3.12Diluted earnings per share:Weighted average shares of common stock outstanding, including effect of dilutive securities386388385Diluted earnings per common share available to Edison International common shareholders$11.55$3.31$3.11 The accompanying notes are an integral part of these consolidated financial statements. 48 48 48 Table of Contents Table of Contents --- ## Modified: Consolidated Balance SheetsSouthern California Edison Company **Key changes:** - Reworded sentence: "December 31,(in millions)20252024ASSETSCash and cash equivalents$98 $78 Receivables, net of allowances for uncollectible accounts of $353 and $347 at respective dates1,455 2,160 Accrued unbilled revenue1,236 845 Inventory535 538 Prepaid expenses118 102 Regulatory assets3,290 2,748 Wildfire Fund contributions138 138 Other current assets743 415 Total current assets7,613 7,024 Nuclear decommissioning trusts4,535 4,286 Other investments40 38 Total investments4,575 4,324 Utility property, plant and equipment, net of accumulated depreciation and amortization of $15,060 and $14,207 at respective dates63,131 59,047 Nonutility property, plant and equipment, net of accumulated depreciation of $113 and $108 at respective dates188 199 Total property, plant and equipment63,319 59,246 Receivables, net of allowances for uncollectible accounts of $49 and $43 at respective dates38 62 Regulatory assets (include $3,092 and $1,512 related to a VIE at respective dates)12,960 8,886 Wildfire Fund contributions1,740 1,878 Operating lease right-of-use assets1,155 1,174 Long-term insurance receivables145 131 Long-term insurance receivables due from affiliate226 303 Other long-term assets2,074 2,317 Total other assets18,338 14,751 Total assets$93,845 $85,345 Receivables, net of allowances for uncollectible accounts of $353 and $347 at respective dates Utility property, plant and equipment, net of accumulated depreciation and amortization of $15,060 and $14,207 at respective dates Nonutility property, plant and equipment, net of accumulated depreciation of $113 and $108 at respective dates Receivables, net of allowances for uncollectible accounts of $49 and $43 at respective dates Regulatory assets (include $3,092 and $1,512 related to a VIE at respective dates) The accompanying notes are an integral part of these consolidated financial statements." **Prior (2025):** December 31,(in millions)20242023ASSETSCash and cash equivalents$78 $214 Receivables, less allowances of $347 and $360 for uncollectible accounts at respective dates2,160 1,981 Accrued unbilled revenue845 741 Inventory538 527 Prepaid expenses102 111 Regulatory assets2,748 2,524 Wildfire Insurance Fund contributions138 204 Other current assets415 331 Total current assets7,024 6,633 Nuclear decommissioning trusts4,286 4,173 Other investments38 38 Total investments4,324 4,211 Utility property, plant and equipment, less accumulated depreciation and amortization of $14,207 and $12,910 at respective dates59,047 55,877 Nonutility property, plant and equipment, less accumulated depreciation of $108 and $100 at respective dates199 201 Total property, plant and equipment59,246 56,078 Receivables, less allowances of $43 and $4 for uncollectible accounts at respective dates62 4 Regulatory assets (include $1,512 and $1,558 related to a VIE at respective dates)8,886 8,897 Wildfire Insurance Fund contributions1,878 1,951 Operating lease right-of-use assets1,174 1,214 Long-term insurance receivables131 157 Long-term insurance receivables due from affiliate303 355 Other long-term assets2,317 1,983 Total other assets14,751 14,561 Total assets$85,345 $81,483 Receivables, less allowances of $347 and $360 for uncollectible accounts at respective dates Utility property, plant and equipment, less accumulated depreciation and amortization of $14,207 and $12,910 at respective dates Nonutility property, plant and equipment, less accumulated depreciation of $108 and $100 at respective dates Receivables, less allowances of $43 and $4 for uncollectible accounts at respective dates Regulatory assets (include $1,512 and $1,558 related to a VIE at respective dates) The accompanying notes are an integral part of these consolidated financial statements. 57 57 57 Table of Contents Table of Contents **Current (2026):** December 31,(in millions)20252024ASSETSCash and cash equivalents$98 $78 Receivables, net of allowances for uncollectible accounts of $353 and $347 at respective dates1,455 2,160 Accrued unbilled revenue1,236 845 Inventory535 538 Prepaid expenses118 102 Regulatory assets3,290 2,748 Wildfire Fund contributions138 138 Other current assets743 415 Total current assets7,613 7,024 Nuclear decommissioning trusts4,535 4,286 Other investments40 38 Total investments4,575 4,324 Utility property, plant and equipment, net of accumulated depreciation and amortization of $15,060 and $14,207 at respective dates63,131 59,047 Nonutility property, plant and equipment, net of accumulated depreciation of $113 and $108 at respective dates188 199 Total property, plant and equipment63,319 59,246 Receivables, net of allowances for uncollectible accounts of $49 and $43 at respective dates38 62 Regulatory assets (include $3,092 and $1,512 related to a VIE at respective dates)12,960 8,886 Wildfire Fund contributions1,740 1,878 Operating lease right-of-use assets1,155 1,174 Long-term insurance receivables145 131 Long-term insurance receivables due from affiliate226 303 Other long-term assets2,074 2,317 Total other assets18,338 14,751 Total assets$93,845 $85,345 Receivables, net of allowances for uncollectible accounts of $353 and $347 at respective dates Utility property, plant and equipment, net of accumulated depreciation and amortization of $15,060 and $14,207 at respective dates Nonutility property, plant and equipment, net of accumulated depreciation of $113 and $108 at respective dates Receivables, net of allowances for uncollectible accounts of $49 and $43 at respective dates Regulatory assets (include $3,092 and $1,512 related to a VIE at respective dates) The accompanying notes are an integral part of these consolidated financial statements. 56 56 56 Table of Contents Table of Contents --- ## Modified: Consolidated Balance SheetsEdison International **Key changes:** - Reworded sentence: "December 31,(in millions)20252024ASSETSCash and cash equivalents$158 $193 Receivables, net of allowances for uncollectible accounts of $356 and $352 at respective dates1,463 2,169 Accrued unbilled revenue1,238 848 Inventory535 538 Prepaid expenses119 103 Regulatory assets3,290 2,748 Wildfire Fund contributions138 138 Other current assets745 418 Total current assets7,686 7,155 Nuclear decommissioning trusts4,535 4,286 Other investments51 57 Total investments4,586 4,343 Utility property, plant and equipment, net of accumulated depreciation and amortization of $15,060 and $14,207 at respective dates63,131 59,047 Nonutility property, plant and equipment, net of accumulated depreciation of $132 and $124 at respective dates197 207 Total property, plant and equipment63,328 59,254 Receivables, net of allowances for uncollectible accounts of $49 and $43 at respective dates38 62 Regulatory assets (include $3,092 and $1,512 related to a Variable Interest Entity ("VIE") at respective dates)12,960 8,886 Wildfire Fund contributions1,740 1,878 Operating lease right-of-use assets1,161 1,180 Long-term insurance receivables359 418 Other long-term assets2,168 2,403 Total other assets18,426 14,827 Total assets$94,026 $85,579 Receivables, net of allowances for uncollectible accounts of $356 and $352 at respective dates Utility property, plant and equipment, net of accumulated depreciation and amortization of $15,060 and $14,207 at respective dates Nonutility property, plant and equipment, net of accumulated depreciation of $132 and $124 at respective dates Receivables, net of allowances for uncollectible accounts of $49 and $43 at respective dates Regulatory assets (include $3,092 and $1,512 related to a Variable Interest Entity ("VIE") at respective dates) The accompanying notes are an integral part of these consolidated financial statements." **Prior (2025):** December 31,(in millions)20242023ASSETSCash and cash equivalents$193 $345 Receivables, less allowances of $352 and $360 for uncollectible accounts at respective dates2,169 2,016 Accrued unbilled revenue848 742 Inventory538 527 Prepaid expenses103 112 Regulatory assets2,748 2,524 Wildfire Insurance Fund contributions138 204 Other current assets418 341 Total current assets7,155 6,811 Nuclear decommissioning trusts4,286 4,173 Other investments57 54 Total investments4,343 4,227 Utility property, plant and equipment, less accumulated depreciation and amortization of $14,207 and $12,910 at respective dates59,047 55,877 Nonutility property, plant and equipment, less accumulated depreciation of $124 and $114 at respective dates207 207 Total property, plant and equipment59,254 56,084 Receivables, less allowances of $43 and $4 for uncollectible accounts at respective dates62 4 Regulatory assets (include $1,512 and $1,558 related to a Variable Interest Entity "VIE" at respective dates)8,886 8,897 Wildfire Insurance Fund contributions1,878 1,951 Operating lease right-of-use assets1,180 1,221 Long-term insurance receivables418 501 Other long-term assets2,403 2,062 Total other assets14,827 14,636 Total assets$85,579 $81,758 Receivables, less allowances of $352 and $360 for uncollectible accounts at respective dates Utility property, plant and equipment, less accumulated depreciation and amortization of $14,207 and $12,910 at respective dates Nonutility property, plant and equipment, less accumulated depreciation of $124 and $114 at respective dates Receivables, less allowances of $43 and $4 for uncollectible accounts at respective dates Regulatory assets (include $1,512 and $1,558 related to a Variable Interest Entity "VIE" at respective dates) The accompanying notes are an integral part of these consolidated financial statements. 51 51 51 Table of Contents Table of Contents **Current (2026):** December 31,(in millions)20252024ASSETSCash and cash equivalents$158 $193 Receivables, net of allowances for uncollectible accounts of $356 and $352 at respective dates1,463 2,169 Accrued unbilled revenue1,238 848 Inventory535 538 Prepaid expenses119 103 Regulatory assets3,290 2,748 Wildfire Fund contributions138 138 Other current assets745 418 Total current assets7,686 7,155 Nuclear decommissioning trusts4,535 4,286 Other investments51 57 Total investments4,586 4,343 Utility property, plant and equipment, net of accumulated depreciation and amortization of $15,060 and $14,207 at respective dates63,131 59,047 Nonutility property, plant and equipment, net of accumulated depreciation of $132 and $124 at respective dates197 207 Total property, plant and equipment63,328 59,254 Receivables, net of allowances for uncollectible accounts of $49 and $43 at respective dates38 62 Regulatory assets (include $3,092 and $1,512 related to a Variable Interest Entity ("VIE") at respective dates)12,960 8,886 Wildfire Fund contributions1,740 1,878 Operating lease right-of-use assets1,161 1,180 Long-term insurance receivables359 418 Other long-term assets2,168 2,403 Total other assets18,426 14,827 Total assets$94,026 $85,579 Receivables, net of allowances for uncollectible accounts of $356 and $352 at respective dates Utility property, plant and equipment, net of accumulated depreciation and amortization of $15,060 and $14,207 at respective dates Nonutility property, plant and equipment, net of accumulated depreciation of $132 and $124 at respective dates Receivables, net of allowances for uncollectible accounts of $49 and $43 at respective dates Regulatory assets (include $3,092 and $1,512 related to a Variable Interest Entity ("VIE") at respective dates) The accompanying notes are an integral part of these consolidated financial statements. 50 50 50 Table of Contents Table of Contents --- ## Modified: Consolidated Statements of IncomeSouthern California Edison Company **Key changes:** - Reworded sentence: "Years ended December 31,(in millions)202520242023Operating revenue$19,276 $17,547 $16,275 Purchased power and fuel4,933 5,209 5,486 Operation and maintenance4,999 5,064 4,071 Wildfire-related claims, net of (recoveries)(2,009)647 665 Wildfire Fund expense144 146 213 Depreciation and amortization3,233 2,865 2,633 Property and other taxes662 620 566 Asset impairment106 - 1 Total operating expenses12,068 14,551 13,635 Operating income7,208 2,996 2,640 Interest expense(1,207)(1,575)(1,356)Other income, net447 493 497 Income before income taxes6,448 1,914 1,781 Income tax expense1,415 120 184 Net income5,033 1,794 1,597 Less: Preference stock dividend requirements144 175 123 Net income available for common stock$4,889 $1,619 $1,474 The accompanying notes are an integral part of these consolidated financial statements." **Prior (2025):** Years ended December 31,(in millions)202420232022Operating revenue$17,547 $16,275 $17,172 Purchased power and fuel5,209 5,486 6,375 Operation and maintenance5,064 4,071 4,659 Wildfire-related claims, net of insurance recoveries647 665 1,305 Wildfire Insurance Fund expense146 213 214 Depreciation and amortization2,865 2,633 2,559 Property and other taxes620 566 497 Impairment, net of other operating income - 1 50 Total operating expenses14,551 13,635 15,659 Operating income2,996 2,640 1,513 Interest expense(1,575)(1,356)(1,005)Other income, net493 497 337 Income before income taxes1,914 1,781 845 Income tax expense (benefit)120 184 (109)Net income1,794 1,597 954 Less: Preference stock dividend requirements175 123 107 Net income available for common stock$1,619 $1,474 $847 The accompanying notes are an integral part of these consolidated financial statements. **Current (2026):** Years ended December 31,(in millions)202520242023Operating revenue$19,276 $17,547 $16,275 Purchased power and fuel4,933 5,209 5,486 Operation and maintenance4,999 5,064 4,071 Wildfire-related claims, net of (recoveries)(2,009)647 665 Wildfire Fund expense144 146 213 Depreciation and amortization3,233 2,865 2,633 Property and other taxes662 620 566 Asset impairment106 - 1 Total operating expenses12,068 14,551 13,635 Operating income7,208 2,996 2,640 Interest expense(1,207)(1,575)(1,356)Other income, net447 493 497 Income before income taxes6,448 1,914 1,781 Income tax expense1,415 120 184 Net income5,033 1,794 1,597 Less: Preference stock dividend requirements144 175 123 Net income available for common stock$4,889 $1,619 $1,474 The accompanying notes are an integral part of these consolidated financial statements. --- ## Modified: Wildfire Fund **Key changes:** - Reworded sentence: "Senate Bill 254 SB 254 expands the Wildfire Fund originally created under AB 1054 by establishing the Continuation Account within the Wildfire Fund." - Reworded sentence: "At December 31, 2025, 2024 and 2023, the asset 63 63 63 Table of Contents Table of Contents was amortized based on an estimated period of coverage of 20 years, 20 years, and 15 years, respectively." **Prior (2025):** Edison International and SCE accounted for the contributions to the Wildfire Insurance Fund similarly to prepaid insurance. No period of coverage was provided in AB 1054, therefore expense is being allocated to periods ratably based on an estimated period of coverage. At December 31, 2024 and 2023, Edison International and SCE had a $1.9 billion and a $2.0 billion long-term asset, respectively, as well as a $138 million and $204 million current asset, respectively, reflected as "Wildfire Insurance Fund contributions" in their consolidated balance sheets for the initial $2.4 billion contribution made during 2019 and the present value of annual contributions SCE committed to make to the Wildfire Insurance Fund, reduced by amortization. At December 31, 2024 and 2023, long-term liabilities of $363 million and $450 million, respectively, have been reflected in "Other deferred credits and other long-term liabilities" for the present value of unpaid contributions. Contributions were discounted to the present value using US treasury interest rates at the date SCE committed to participate in the Wildfire Insurance Fund. Edison International and SCE reassesses the period of coverage of the fund at least annually in the first quarter each year, and adjustments are applied on a prospective basis. At December 31, 2024, 2023 and 2022, the asset was amortized based on an estimated period of coverage of 20 years, 15 years, and 15 years, respectively. All expenses related to the 64 64 64 Table of Contents Table of Contents contributions are being reflected in "Wildfire Insurance Fund Expense" in the consolidated statements of income. Changes in the estimated period of coverage provided by the Wildfire Insurance Fund could lead to material changes in future expense recognition. In estimating the period of coverage, Edison International and SCE used Monte Carlo simulations based on historical data from wildfires caused by electrical utility equipment to estimate expected losses, using ten years (2014 - 2023) of available historical data in 2024, nine years (2014 - 2022) of available historical data in 2023, and eight years (2014 - 2021) of available historical data in 2022. The details of the operation of the Wildfire Insurance Fund and estimates related to claims by SCE, PG&E, and SDG&E against the fund have been applied to the expected loss simulations to estimate the period of coverage of the fund. The most sensitive inputs to the estimated period of coverage are the expected frequency of wildfire events caused by investor-owned utility electrical equipment and the estimated costs associated with those forecasted events. These inputs are most affected by the historical data used in estimating expected losses. There were fires in the service area of SCE, PG&E and SDG&E since the inception of the Wildfire Insurance Fund, including fires for which the cause is unknown, which may in the future be determined to be covered by the Wildfire Insurance Fund and have not been reflected or estimated in this analysis will be included in this analysis at that time. As of the date of this filing, SCE is continuing to perform its annual assessment for 2025 to reassess its estimate of the life of the Wildfire Insurance Fund. Edison International and SCE assess the Wildfire Insurance Fund contribution assets for impairment each reporting period. An impairment will be recorded if the recorded asset exceeds SCE's ability to benefit from the remaining coverage provided by the Wildfire Insurance Fund. **Current (2026):** Senate Bill 254 SB 254 expands the Wildfire Fund originally created under AB 1054 by establishing the Continuation Account within the Wildfire Fund. The Continuation Account became operative upon all three California investor-owned utilities, PG&E, SCE, and SDG&E (collectively, the "IOUs") electing to participate and agreeing to contribute to the Continuation Account if required. The administrator of the Wildfire Fund will determine, on or before December 31, 2028, whether contributions to the Continuation Account are required, based on either of the following conditions: (a) the fund administrator projects that the original Wildfire Fund will be depleted within three years, or (b) a participating IOU notifies the fund administrator that it anticipates more than $1 billion in eligible claims in a single coverage year for one or more wildfires that ignite after the SB 254 Effective Date. If the fund administrator determines contributions are required, the CPUC will extend the non-bypassable charge imposed under AB 1054 until January 1, 2046 to collect customer contributions for the Continuation Account of $9 billion, and the IOUs will be required to contribute an initial aggregate amount of $5.1 billion (SCE's share is $2.4 billion) over the period 2029 through 2045. Additionally, if the fund administrator determines that additional contributions from IOUs are needed to enable the Continuation Account to fund the timely payment of eligible claims due to the likelihood of exhaustion of the fund, the fund administrator may require an additional aggregate contribution from the IOUs of $3.9 billion (the "Contingent Contribution" and SCE's share is $1.9 billion). If the administrator terminates the Continuation Account prior to the final installment of the Contingent Contribution, one-half of the remaining unpaid installment payments will be credited to customer rates. As of December 31, 2025, and as of the date of this filing, the conditions required to trigger IOU contributions to the Continuation Account have not been met. Accordingly, SCE has not recorded a contribution obligation associated with the Continuation Account on its consolidated balance sheets as of December 31, 2025. Wildfire Fund accounting and amortization life Edison International and SCE accounted for the contributions to the Wildfire Fund similarly to prepaid insurance. No period of coverage was provided in the California Wildfire Legislation, therefore expense is being allocated to periods ratably based on an estimated period of coverage. At December 31, 2025 and 2024, Edison International and SCE had a $1.7 billion and a $1.9 billion long-term asset, respectively, as well as a $138 million current asset for both periods, reflected as "Wildfire Fund contributions" in their consolidated balance sheets for the initial $2.4 billion contribution made during 2019 and the present value of annual contributions SCE committed to make to the Wildfire Fund, reduced by amortization. At December 31, 2025 and 2024, long-term liabilities of $274 million and $363 million, respectively, have been reflected in "Other deferred credits and other long-term liabilities" for the present value of unpaid contributions. Contributions were discounted to the present value using US treasury interest rates at the date SCE committed to participate in the Wildfire Fund. Edison International and SCE reassesses the period of coverage of the fund at least annually in the first quarter each year, and adjustments are applied on a prospective basis. At December 31, 2025, 2024 and 2023, the asset 63 63 63 Table of Contents Table of Contents was amortized based on an estimated period of coverage of 20 years, 20 years, and 15 years, respectively. All expenses related to the contributions are being reflected in "Wildfire Fund Expense" in the consolidated statements of income. Changes in the estimated period of coverage provided by the Wildfire Fund could lead to material changes in future expense recognition. In 2025, management determined that the period of coverage for the Wildfire Fund, based on available historical data from wildfires caused by electrical utility equipment to estimate expected loss, continues to be an estimated 20 years from the date SCE committed to participate in the Wildfire Fund. SCE reassesses the period of coverage of the fund at least annually in the first quarter each year and when new or additional information becomes available. As of the date of this filing, after considering the current accrued losses for the Eaton Fire, SCE does not have new or additional information that would enable it to change its prior assessment that the Wildfire Fund would provide coverage for an estimated 20 years from the date SCE committed to participate in the Wildfire Fund. When updating its estimate, SCE includes all its fires for which losses can be reasonably estimated, and relies on publicly disclosed wildfire-related losses related to other participating utilities. As discussed in Note 12, while SCE believes that it will incur material losses in connection with the Eaton Fire, it is currently unable to reasonably estimate a range of losses that may be incurred. The Wildfire Fund amortization period will be evaluated and adjusted as new or additional information on contributions and wildfire events, including reasonably estimated losses related to the Eaton Fire, becomes available. As of December 31, 2025, the Wildfire Fund does not have any contribution associated with the Continuation Account. As of December 31, 2025, SCE has recorded a receivable of $134 million from the Wildfire Fund, reflected in "Long-term insurance receivables." Based on California Wildfire legislation, a utility that submits claims to the Wildfire Fund for recovery is expected to receive such reimbursements from the Wildfire Fund, and separately file an application with CPUC for review of its costs and expenses. See Note 12 for further information. The outcome of the CPUC's prudency review could result in a refund to the Wildfire Fund. SCE will recognize a payable related to claim reimbursements to the Wildfire Fund if it determines that refund to the Wildfire Fund is probable and estimable. SCE will consider whether any party in the CPUC prudency review proceeding would prevail in raising a "serious doubt" as of the reasonableness of SCE's actions, and whether it is probable the CPUC would conclude that SCE does not meet the burden of dispelling that doubt and find SCE's conduct was not prudent. As of December 31, 2025, SCE determined it is not probable nor estimable that any amounts may be required to be reimbursed to the Wildfire Fund. --- ## Modified: Plan Assets **Key changes:** - Reworded sentence: "Target allocations for 2025 pension plan assets were 60% for fixed income, 24% for global equities, and 16% for opportunistic and/or alternative investments." - Removed sentence: "Plan asset classes and 88 88 88 Table of Contents Table of Contents individual manager performances are measured against targets." - Removed sentence: "Edison International also monitors the stability of its investment managers' organizations." - Removed sentence: "Allowable investment types under CPUC investment guidelines include: •United States equities: common and preferred stocks of large, medium, and small companies which are predominantly United States-based." - Removed sentence: "•Non-United States equities: equity securities issued by companies domiciled outside the United States and in depository receipts which represent ownership of securities of non-United States companies." **Prior (2025):** Description of Pension and Postretirement Benefits Other than Pensions Investment Strategies The investment of plan assets is overseen by a fiduciary investment committee. Plan assets are invested using a combination of asset classes and may have active and passive investment strategies within asset classes. Target allocations for 2024 pension plan assets were 17.3% for U.S. equities, 9.7% for non-U.S. equities, 55% for fixed income and 18% for opportunistic and/or alternative investments. Target allocations for 2024 PBOP plan assets (except for Represented VEBA which is 95% for fixed income and 5% for U.S. and non-U.S. equities) are 29% for U.S. and non-U.S. equities, 65% for fixed income and 6% for opportunistic and/or alternative investments. Edison International employs multiple investment management firms. Investment managers within each asset class cover a range of investment styles and approaches. Risk is managed through diversification among multiple asset classes, managers, styles and securities. Plan asset classes and 88 88 88 Table of Contents Table of Contents individual manager performances are measured against targets. Edison International also monitors the stability of its investment managers' organizations. Allowable investment types under CPUC investment guidelines include: •United States equities: common and preferred stocks of large, medium, and small companies which are predominantly United States-based. •Non-United States equities: equity securities issued by companies domiciled outside the United States and in depository receipts which represent ownership of securities of non-United States companies. •Fixed income: fixed income securities issued or guaranteed by the United States government, non-United States governments, government agencies and instrumentalities including municipal bonds, mortgage backed securities and corporate debt obligations. A portion of the fixed income positions may be held in debt securities that are below investment grade. •Opportunistic, alternative and other investments: Opportunistic investments in short to intermediate term market opportunities. Investments may have fixed income and/or equity characteristics and may be either liquid or illiquid. Alternative investments are limited partnerships that invest in non-publicly traded entities. Other investments are diversified among multiple asset classes such as global equity, fixed income currency and commodities markets. Investments are made in liquid or illiquid instruments within and across markets. The investment returns are expected to approximate the plans' expected investment returns. Asset class portfolio weights are permitted to range within plus or minus 5%. Where approved by the fiduciary investment committee, futures contracts are used for portfolio rebalancing and to reallocate portfolio cash positions. Where authorized, a few of the plans' investment managers employ limited use of derivatives, including futures contracts, options, options on futures and interest rate swaps in place of direct investment in securities to gain efficient exposure to markets. Derivatives are not used to leverage the plans or any portfolios. Determination of the Expected Long-Term Rate of Return on Assets The overall expected long-term rate of return on assets assumption is based on the long-term target asset allocation for plan assets and capital markets return forecasts for asset classes employed. A portion of the PBOP trust asset returns is subject to taxation, so the expected long-term rate of return for these assets is determined on an after-tax basis. Capital Markets Return Forecasts Edison International's capital markets return forecast methodologies primarily use a combination of historical market data, current market conditions, proprietary forecasting expertise, complex models to develop asset class return forecasts, and a building block approach. The forecasts are developed using variables such as real risk-free interest, inflation and asset class specific risk premiums. For equities, the risk premium is based on an implied average equity risk premium of 4% over cash. The forecasted return on private equity and opportunistic investments are estimated at a 3% premium above public equity, reflecting a premium for higher volatility and lower liquidity. For fixed income, the risk premium is based on a comprehensive modeling of credit spreads. Fair Value of Plan Assets The PBOP Plan and the Southern California Edison Company Retirement Plan Trust assets include investments in equity securities, U.S. treasury securities, other fixed-income securities, common/collective funds, mutual funds, other investment entities, foreign exchange and interest rate contracts, and partnership/joint ventures. Equity securities, U.S. treasury securities, and mutual and money market funds are classified as Level 1 as fair value is determined by observable, unadjusted quoted market prices in active or highly liquid and transparent markets. The fair value of the underlying investments in equity mutual funds are based on stock-exchange prices. The fair value of the underlying investments in fixed-income mutual funds and other fixed income securities including municipal bonds are based on evaluated prices that reflect significant observable market information such as reported trades, actual trade information of similar securities, benchmark yields, broker/dealer quotes, issuer spreads, bids, offers, and relevant credit information. Foreign exchange and interest rate contracts are classified as Level 2 because the values are based on observable prices but are not traded on an exchange. Futures contracts trade on an exchange and therefore are classified as Level 1. No investment is classified as Level 3 as of December 31, 2024 and 2023. Common/collective funds and partnerships are measured at fair value using the net asset value per share ("NAV") and have not been classified in the fair value hierarchy. Other investment entities are valued similarly to common/collective funds and are therefore classified as NAV. The Level 1 registered investment companies are either mutual or money market funds. The remaining funds in this category are readily redeemable and classified as NAV and are discussed further in the below pension plan trust investments table's note 8. **Current (2026):** Description of Pension and Postretirement Benefits Other than Pensions Investment Strategies The investment of plan assets is overseen by a fiduciary investment committee. Plan assets are invested using a combination of asset classes and may have active and passive investment strategies within asset classes. Target allocations for 2025 pension plan assets were 60% for fixed income, 24% for global equities, and 16% for opportunistic and/or alternative investments. Target allocations for 2025 PBOP plan assets (except for Represented VEBA which is 93% for fixed income, 6% for global equities, and 1% for opportunistic and/or alternative investments) are 62% for fixed income, 28% for global equities, and 10% for opportunistic and/or alternative investments. Edison International employs multiple investment management firms. Investment managers within each asset class cover a range of investment styles and approaches. Risk is managed through diversification among multiple asset classes, managers, styles and securities. Plan --- *Data sourced from SEC EDGAR. Last updated 2026-06-01.*