Via Renewables, Inc. (VIASP)

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data from SEC XBRL filings. Values are as-reported; restatements supersede originals. Values reported in .

From 10-K filed 2026-03-05 (period ending 2025-12-31).

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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the consolidated financial statements and the related notes thereto included elsewhere in this Annual Report. In this Annual Report, the terms “Via," "Via Renewables," "Spark Energy," “Company,” “we,” “us” and “our” refer collectively to Via Renewables, Inc. and its subsidiaries.

Overview

We are an independent retail energy services company founded in 1999 that provides residential and commercial customers in competitive markets across the United States with an alternative choice for natural gas and electricity. We purchase our natural gas and electricity supply from a variety of wholesale providers and bill our customers monthly for the delivery of natural gas and electricity based on their consumption at either a fixed or variable price. Natural gas and electricity are then distributed to our customers by local regulated utility companies through their existing infrastructure. As of December 31, 2025, we operated in 106 utility service territories across 21 states and the District of Columbia.

Our business consists of two operating segments:

•Retail Electricity Segment. In this segment, we purchase electricity supply through physical and financial transactions with market counterparties and ISOs and supply electricity to residential and commercial consumers pursuant to fixed-price and variable-price contracts. For the years ended December 31, 2025, 2024 and 2023, approximately 67%, 75% and 75%, respectively, of our retail revenues were derived from the sale of electricity.

•Retail Natural Gas Segment. In this segment, we purchase natural gas supply through physical and financial transactions with market counterparties and supply natural gas to residential and commercial consumers pursuant to fixed-price and variable-price contracts. For the years ended December 31, 2025, 2024 and 2023, approximately 33%, 25% and 25%, respectively, of our retail revenues were derived from the sale of natural gas.

Recent Developments

Acquisition of Customer Books

In October 2025, we entered into an asset purchase agreement to acquire up to 3,300 RCEs for a cash purchase price of up to a maximum $0.5 million paid in cash or funded in escrow accounts. These electricity customers were located in our existing market and transferred from the sellers to the Company in the fourth quarter of 2025.

Partial Redemption of Series A Preferred Stock

On November 18, 2025, we announced the redemption of 258,565 shares of our Series A Preferred Stock for a redemption price of $25.00 per share, plus an amount equal to all accumulated and unpaid dividends thereon to, but not including, the redemption date of December 18, 2025. We paid $6.6 million on the redemption date.

On January 16, 2026, we announced the redemption of 232,708 shares of our Series A Preferred Stock for a redemption price of $25.00 per share, plus an amount equal to all accumulated and unpaid dividends thereon to, but not including, the redemption date of February 17, 2026. We paid $5.9 million on the redemption date.

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Drivers of Our Business

The success of our business and our profitability are impacted by a number of drivers, the most significant of which are discussed below.

Customer Growth

Customer growth is a key driver of our operations. Our ability to acquire customers organically or by acquisition is important to our success as we experience ongoing customer attrition. Our customer growth strategy includes growing organically through traditional sales channels complemented by customer portfolio and business acquisitions.

We measure our number of customers using residential customer equivalents ("RCEs"). The following table shows our RCEs by segment as of December 31, 2025, 2024 and 2023:

RCEs:
	December 31,
(In thousands)	2025	2024	2023
Retail Electricity	225	232	217
Retail Natural Gas	196	156	118
Total Retail	421	388	335

The following table details our count of RCEs by geographical location as of December 31, 2025:

RCEs by Geographic Location:
(In thousands)	Electricity	% of Total	Natural Gas	% of Total	Total	% of Total
New England	46	20%	22	11%	68	16%
Mid-Atlantic	120	54%	50	26%	170	40%
Midwest	25	11%	33	17%	58	14%
Southwest	34	15%	91	46%	125	30%
Total	225	100%	196	100%	421	100%

The geographical locations noted above include the following states:

•New England - Connecticut, Maine, Massachusetts, New Hampshire and Rhode Island;

•Mid-Atlantic - Delaware, Maryland (including the District of Columbia), New Jersey, New York, Pennsylvania and Virginia;

•Midwest - Illinois, Indiana, Michigan and Ohio; and

•Southwest - Arizona, California, Colorado, Florida, Nevada and Texas.

Our organic sales strategies are designed to offer competitive pricing, price certainty, and/or green product offerings to residential and commercial customers. We manage growth on a market-by-market basis by developing price curves in each of the markets we serve and comparing the market prices to the price offered by the local regulated utility. We then determine if there is an opportunity in a particular market based on our ability to create a competitive product on economic terms that provides customer value and satisfies our profitability objectives. We develop marketing campaigns using a combination of sales channels. Our marketing team continuously evaluates the effectiveness of each customer acquisition channel and makes adjustments in order to achieve desired targets.

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During the year ended December 31, 2025, we added approximately 188,400 RCEs through our various organic sales channels. We expect our customer growth to continue to increase, however, we are unable to predict the ultimate effect of market conditions on our organic sales, financial results, cash flows, and liquidity at this time.

We also acquire companies and portfolios of customers through both external and affiliated channels. During the year ended December 31, 2025, we added 46,600 RCEs through asset purchase agreements. Refer to Note 15 “Customer Acquisitions” for further discussion. Our ability to realize returns from acquisitions that are acceptable to us is dependent on our ability to successfully identify, negotiate, finance and integrate acquisitions.

While we remain focused on organic sales and identifying customer portfolio and business acquisitions, we cannot ensure that our RCE count will remain at current levels or grow. Our RCE count, as well as the margins we earn on our customers, contribute to our overall profitability, cash flow and ability to pay dividends.

RCE Activity

The following table shows our RCE activity during the years ended December 31, 2025, 2024 and 2023.

(In thousands)	Retail Electricity	Retail Natural Gas	Total	% Net Annual Increase (Decrease)
December 31, 2022	201	130	331
Additions	118	22	140
Attrition	(102)	(34)	(136)
December 31, 2023	217	118	335	1%
Additions	129	80	209
Attrition	(114)	(42)	(156)
December 31, 2024	232	156	388	16%
Additions	143	92	235
Attrition	(150)	(52)	(202)
December 31, 2025	225	196	421	26%

Customer attrition occurs primarily as a result of: (i) customer initiated switches; (ii) residential moves (iii) disconnection resulting from customer payment defaults and (iv) pro-active non-renewal of contracts. Average monthly attrition rates during 2025, 2024 and 2023 were as follows:

	Year Ended	Quarter Ended
	December 31	December 31	September 30	June 30	March 31
2023	3.4%	3.3%	3.1%	3.1%	3.9%
2024	3.9%	4.0%	4.1%	3.4%	3.9%
2025	4.2%	4.9%	4.0%	3.5%	4.3%

Customer attrition during the year ended December 31, 2024 was higher than the year ended December 31, 2023 driven primarily by proactive non-renewals in New York due to regulatory changes, along with increased attrition attributed to the new customer book acquisitions in the fourth quarter.

Customer attrition for the year ended December 31, 2025 was higher than the year ended December 31, 2024 primarily due to proactive non-renewals in Maryland due to regulatory changes as well as higher attrition related to new customer book acquisitions.

Customer Acquisition Costs

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Managing customer acquisition costs is a key component of our profitability. Customer acquisition costs are those costs related to obtaining customers organically and do not include the cost of acquiring customers through acquisitions, which are recorded as customer relationships. For each of the three years ended December 31, 2025, customer acquisition costs were as follows:

	Year Ended December 31,
(In thousands)	2025		2024		2023
Customer Acquisition Costs	$	10,415	$	9,508	$	6,736

We strive to maintain a disciplined approach to recovery of our customer acquisition costs within a 12 month period. We capitalize and amortize our customer acquisition costs over a one to two year period, which is based on our estimate of the expected average length of a customer relationship. We factor in the recovery of customer acquisition costs in determining what markets we enter and the pricing of our products in those markets. Accordingly, our results are significantly influenced by our customer acquisition costs. Changes in customer acquisition costs from period to period reflect our focus on growing organically versus growth through acquisitions. We are currently focused on growing through organic sales channels; however, we continue to evaluate opportunities to acquire customers through acquisitions and pursue such acquisitions when deemed economically or strategically advantageous.

Customer Credit Risk

Approximately 61% of our revenues are derived from customers in utilities where customer credit risk is borne by the utility in exchange for a discount on amounts billed. Where we have customer credit risk, we record bad debt based on an estimate of uncollectible amounts. Our credit loss expense on non-POR revenues was as follows:

	Year Ended December 31,
	2025		2024		2023
Total Non-POR Credit Loss as Percent of Revenue	0.5	%	1.3	%	1.7	%

During the year ended December 31, 2025, we experienced lower credit loss expense versus 2024. In 2025, our continued focus on collection efforts and enhanced credit check requirements resulted in a decrease in credit loss expense.

During the year ended December 31, 2024, we experienced lower credit loss expense versus 2023. In 2024, our continued focus on collection efforts resulted in a decrease in credit loss expense.

For the years ended December 31, 2025, 2024 and 2023, approximately 61%, 60% and 55%, respectively, of our retail revenues were collected through POR programs where substantially all of our credit risk was with local regulated utility companies. As of December 31, 2025, 2024 and 2023, all of these local regulated utility companies had investment grade ratings. During these same periods, we paid these local regulated utilities a weighted average discount of approximately 0.2%, 1.2% and 1.0%, respectively, of total revenues for customer credit risk protection.

Weather Conditions

Weather conditions directly influence the demand for natural gas and electricity and affect the prices of energy commodities. Our hedging strategy is based on forecasted customer energy usage, which can vary substantially as a result of weather patterns deviating from historical norms. We are particularly sensitive to this variability in our residential customer segment where energy usage is highly sensitive to weather conditions that impact heating and cooling demand.

Our risk management policies direct that we hedge substantially all of our forecasted demand, which is typically hedged to long-term normal weather patterns. We also attempt to add additional protection through hedging from time to time to protect us from potential volatility in markets where we have historically experienced higher

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exposure to extreme weather conditions. Because we attempt to match commodity purchases to anticipated demand, unanticipated changes in weather patterns can have a significant impact on our operating results and cash flows from period to period.

Asset Optimization

Our asset optimization opportunities primarily arise during the winter heating season when demand for natural gas is typically at its highest. Given the opportunistic nature of these activities and because we account for these activities using the mark to market method of accounting, we experience variability in our earnings from our asset optimization activities from year to year.

Net asset optimization resulted in a loss of $3.8 million, $2.3 million and $7.3 million for the years ended December 31, 2025, 2024 and 2023, respectively.

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Non-GAAP Performance Measures

We use the Non-GAAP performance measures of Adjusted EBITDA and Retail Gross Margin to evaluate and measure our operating results. These measures for the three years ended December 31, 2025 were as follows:

	Year Ended December 31,
(in thousands)	2025		2024		2023
Adjusted EBITDA (1)	$	72,308	$	58,581	$	56,855
Retail Gross Margin (1)	$	149,769	$	141,996	$	136,650

(1) Adjusted EBITDA for the year ended December 31, 2025, 2024 and 2023 includes an add back of $0.1 million, $2.4 million and 0.8 million, respectively, related to merger agreement expense.

Adjusted EBITDA. We define “Adjusted EBITDA” as EBITDA less (i) customer acquisition costs incurred in the current period, plus or minus (ii) net (loss) gain on derivative instruments, and (iii) net current period cash settlements on derivative instruments, plus (iv) non-cash compensation expense, and (v) other non-cash and non-recurring operating items. EBITDA is defined as net income (loss) before the provision for income taxes, interest expense and depreciation and amortization. This conforms to the calculation of Adjusted EBITDA in our Senior Credit Facility.

We deduct all current period customer acquisition costs (representing spending for organic customer acquisitions) in the Adjusted EBITDA calculation because such costs reflect a cash outlay in the period in which they are incurred, even though we capitalize and amortize such costs over two years. We do not deduct the cost of customer acquisitions through acquisitions of businesses or portfolios of customers in calculating Adjusted EBITDA.

We deduct our net gains (losses) on derivative instruments, excluding current period cash settlements, from the Adjusted EBITDA calculation in order to remove the non-cash impact of net gains and losses on these instruments. We also deduct non-cash compensation expense that results from the issuance of restricted stock units under our long-term incentive plan due to the non-cash nature of the expense.

We adjust from time to time other non-cash or unusual and/or infrequent charges due to either their non-cash nature or their infrequency. We have historically included the financial impact of weather variability in the calculation of Adjusted EBITDA.

We believe that the presentation of Adjusted EBITDA provides information useful to investors in assessing our liquidity and financial condition and results of operations and that Adjusted EBITDA is also useful to investors as a financial indicator of our ability to incur and service debt, pay dividends and fund capital expenditures. Adjusted EBITDA is a supplemental financial measure that management and external users of our consolidated financial statements, such as industry analysts, investors, commercial banks and rating agencies, use to assess the following:

•our operating performance as compared to other publicly traded companies in the retail energy industry, without regard to financing methods, capital structure or historical cost basis;

•the ability of our assets to generate earnings sufficient to support our proposed cash dividends;

•our ability to fund capital expenditures (including customer acquisition costs) and incur and service debt; and

•our compliance with financial debt covenants. (Refer to Note 9 "Debt" in the Company’s audited consolidated financial statements for discussion of the material terms of our Senior Credit Facility, including the covenant requirements for our Minimum Fixed Charge Coverage Ratio and Maximum Total Leverage Ratio)

The GAAP measures most directly comparable to Adjusted EBITDA are net income (loss) and net cash provided by (used in) operating activities. The following table presents a reconciliation of Adjusted EBITDA to these GAAP measures for each of the periods indicated.

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	Year Ended December 31,
(in thousands)	2025		2024		2023
Reconciliation of Adjusted EBITDA to Net Income:
Net income	$	35,583	$	61,075	$	26,105
Depreciation and amortization	21,824		9,446		9,102
Interest expense	7,517		6,943		9,334
Income tax expense	10,523		16,259		11,142
EBITDA	75,447		93,723		55,683
Less:
Net, (loss) on derivative instruments	(5,964)		(3,720)		(71,493)
Net, cash settlements on derivative instruments	(1,213)		34,148		66,632
Customer acquisition costs	10,415		9,508		6,736
Plus:
Non-cash compensation expense	—		2,411		2,295
Merger agreement expense	99		2,383		752
Adjusted EBITDA	$	72,308	$	58,581	$	56,855

The following table presents a reconciliation of Adjusted EBITDA to net cash provided by operating activities for each of the periods indicated.

	Year Ended December 31,
(in thousands)	2025		2024		2023
Reconciliation of Adjusted EBITDA to net cash provided by operating activities:
Net cash provided by operating activities	$	42,097	$	50,484	$	49,315
Amortization of deferred financing costs	(792)		(852)		(825)
Bad debt expense	(1,308)		(2,469)		(3,442)
Interest expense	7,517		6,943		9,334
Income tax expense	10,523		16,259		11,142
Merger agreement expense	99		2,383		752
Changes in operating working capital
Accounts receivable, prepaids, current assets	29,506		(734)		(17,159)
Inventory	790		(987)		(1,281)
Accounts payable, accrued liabilities, current liabilities	(10,470)		(3,380)		15,206
Other	(5,654)		(9,066)		(6,187)
Adjusted EBITDA	$	72,308	$	58,581	$	56,855
Cash Flow Data:
Cash flows provided by operating activities	$	42,097	$	50,484	$	49,315
Cash flows used in investing activities	$	(17,581)	$	(4,727)	$	(1,435)
Cash flows used in financing activities	$	(51,894)	$	(18,093)	$	(40,636)

Retail Gross Margin. We define Retail Gross Margin as gross profit less (i) net asset optimization revenues (expenses), (ii) net gains (losses) on non-trading derivative instruments, (iii) net current period cash settlements on non-trading derivative instruments and (iv) gains (losses) from non-recurring events (including non-recurring market volatility). Retail Gross Margin is included as a supplemental disclosure because it is a primary performance measure used by our management to determine the performance of our retail natural gas and electricity segments. As an indicator of our retail energy business’s operating performance, Retail Gross Margin should not be considered

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an alternative to, or more meaningful than, gross profit, its most directly comparable financial measure calculated and presented in accordance with GAAP.

We believe retail gross margin provides information useful to investors as an indicator of our retail energy business's operating performance.

The GAAP measure most directly comparable to Retail Gross Margin is gross profit. The following table presents a reconciliation of Retail Gross Margin to gross profit for each of the periods indicated.

	Year Ended December 31,
(in thousands)	2025		2024		2023
Reconciliation of Retail Gross Margin to Gross Profit:
Total Revenues	$	463,451	$	398,868	$	435,192
Less:
Retail cost of revenues	321,807		230,791		310,744
Gross Profit	$	141,644	$	168,077	$	124,448
Less:
Net asset optimization expense	(3,770)		(2,326)		(7,326)
Net, (loss) on non-trading derivative instruments	(3,142)		(4,464)		(70,304)
Net, cash settlements on non-trading derivative instruments	(1,213)		32,871		65,428
Retail Gross Margin	$	149,769	$	141,996	$	136,650
Retail Gross Margin - Retail Electricity Segment	$	88,909	$	93,669	$	87,566
Retail Gross Margin - Retail Natural Gas Segment	$	60,847	$	47,865	$	47,489
Retail Gross Margin - Other	$	13	$	462	$	1,595

Our non-GAAP financial measures of Adjusted EBITDA and Retail Gross Margin should not be considered as alternatives to gross profit. Adjusted EBITDA and Retail Gross Margin are not presentations made in accordance with GAAP and have limitations as analytical tools. You should not consider Adjusted EBITDA or Retail Gross Margin in isolation or as a substitute for analysis of our results as reported under GAAP. Because Adjusted EBITDA and Retail Gross Margin exclude some, but not all, items that affect gross profit, and are defined differently by different companies in our industry, our definition of Adjusted EBITDA and Retail Gross Margin may not be comparable to similarly titled measures of other companies.

Management compensates for the limitations of Adjusted EBITDA and Retail Gross Margin as analytical tools by reviewing the comparable GAAP measures, understanding the differences between the measures and incorporating these data points into management’s decision-making process.

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Consolidated Results of Operations

(In Thousands)	Year Ended December 31,
	2025		2024		2023
Revenues:
Retail revenues	$	467,175	$	399,418	$	439,360
Net asset optimization expense	(3,770)		(2,326)		(7,326)
Other revenue	46		1,776		3,158
Total Revenues	463,451		398,868		435,192
Operating Expenses:
Retail cost of revenues	321,807		230,791		310,744
General and administrative expense	66,289		74,453		68,874
Depreciation and amortization	21,824		9,446		9,102
Total Operating Expenses	409,920		314,690		388,720
Operating income	53,531		84,178		46,472
Other (expense)/income:
Interest expense	(7,517)		(6,943)		(9,334)
Interest and other income	92		99		109
Total Other (Expenses)/Income	(7,425)		(6,844)		(9,225)
Income before income tax expense	46,106		77,334		37,247
Income tax expense	10,523		16,259		11,142
Net income	$	35,583	$	61,075	$	26,105
Other Performance Metrics:
Adjusted EBITDA (1) (2)	$	72,308	$	58,581	$

Next expected filings

~2026-07-30 10-Q expected by 2026-08-07 (in 1 day)
~2026-11-05 10-Q expected by 2026-11-13 (in 99 days)
~2027-04-29 10-Q expected by 2027-05-07 (in 274 days)

Predicted from historical filing cadence; not an SEC commitment.

Recent SEC filings

2026-06-01 8-K Other Events; Financial Statements and Exhibits
2026-05-08 8-K Material Agreement Entered; Material Agreement Terminated; Material Financial Obligation; Material Modification to Rights; Financial Statements and Exhibits
2026-04-30 10-Q Quarterly Report
2026-04-27 10-K/A Annual Report (Amended)
2026-04-20 8-K Other Events; Financial Statements and Exhibits
2026-03-05 10-K Annual Report
2026-01-16 8-K Other Events; Financial Statements and Exhibits
2025-12-05 8-K Officer/Director Change; Financial Statements and Exhibits
2025-11-18 8-K Other Events; Financial Statements and Exhibits
2025-11-06 10-Q Quarterly Report
2025-09-15 8-K Other Events; Financial Statements and Exhibits
2025-07-31 10-Q Quarterly Report
2025-07-16 8-K Other Events; Financial Statements and Exhibits
2025-06-26 8-K Other Events
2025-05-09 8-K Other Events; Financial Statements and Exhibits

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