Thank you, Alicia. Before we begin, please note that certain remarks we will make on this call constitute forward-looking statements related to the expected future results of our company, including our Q4 and full year 2026 financial outlook and other statements that are not historical in nature, are predictive in nature or depend upon or refer to events or conditions such as our expectations, estimates, predictions, strategies, beliefs or other statements that may be considered forward-looking.

Although we believe these statements reflect our best judgment based on factors currently known to us, actual results may differ materially and adversely. Please refer to the company's filings with the SEC for a more inclusive discussion of risks and other factors that may cause our actual results to differ from projections made in any forward-looking statements.

Please also note these statements are being made as of today, and we disclaim any obligation to update or revise them. Please note during this earnings call, we may refer to certain non-GAAP measures, including cash generation, creation cost reflected in operating expenses, and creation cost reflected in capital expenditures, which are not measures prepared in accordance with U.S.

GAAP. These non-GAAP measures are being presented because we believe they provide investors with a means of evaluating and understanding how the company's management evaluates the company's operating performance.

Reconciliation of these measures can be found in our earnings press release and other investor materials available on the company's Investor Relations website and accompanying this webcast. These non-GAAP measures should not be considered in isolation from, as substitutes for, or superior to financial measures prepared in accordance with U.S.

GAAP. On the call today is Mary Powell, Sunrun's CEO; Paul Dickson, Sunrun's President and Chief Revenue Officer; and Danny Abajian, Sunrun's CFO.

A presentation is available on Sunrun's Investor Relations website along with supplemental accompanying materials. An audio replay of today's call, along with a copy of today's prepared remarks and transcript, including Q&A, will be posted to Sunrun's Investor Relations website shortly after the call.

Now let me turn the call over to Mary.

Thank you, Patrick, and thank you all for joining us today. I'm pleased to report Sunrun's direct business is growing.

This business results in improving margins, higher customer satisfaction, and higher quality assets. We are back to growth in our direct sales activities compared to the prior year in Q3, and most recently in October.

We expect to exit this year with continued growth. We successfully reset our affiliate business with partners that can meet our rigorous standards and that we are excited to grow with.

We achieved a record 75% storage attachment rate in Q3. We increased our upfront net subscriber value margins considerably, expanding from $2,000 per subscriber in Q2 to over $3,700 in Q3.

This represents a margin of about 7% of contracted subscriber value. We also delivered positive cash generation again in Q3, generating $56 million excluding investments in equipment for safe harbor activities, and expect to have robust cash generation in Q4.

We reduced our parent debt further in the quarter, reducing debt by over $100 million year to date. Recent increases in interest rates combined with persistent slightly below expectation sales onboarding has led us to anchor on the low end of our cash generation expectation for the full year.

Paul will discuss our sales activities and growth outlook in more detail. Danny will talk through our cash generation outlook.

Before turning to those topics, I want to provide a strategic update on our growing distributed power plant operations. Our energy assets are at the center of a power sector that is in need of energy capacity, and where speed to power is critical.

Sunrun now has over 5 gigawatt-hours of storage capacity installed across the country, and is the largest residential independent power producer. America needs more power faster than the traditional grid can deliver it, and Sunrun is well situated to meet that need.

Sunrun set new records dispatching energy to the grid, achieving 434 megawatts in a single event. At the end of Q3, we had installed more than 284,000 storage-plus-solar systems.

We own a valuable network of flexible dispatchable power, and are growing it at a rapid pace. Sunrun added more than 1.3 gigawatt-hours of storage capacity and dispatched more than 1,000 megawatts of power over the last 12 months across the country.

We expect to double the amount of capacity we have online by the end of 2028, grow participation rates substantially, and increase revenue per enrolled asset, resulting in meaningful and rapidly growing cash generation. We remain in active communication with utilities, energy market coordinators, and hyperscalers about how our resources can bring value to the energy system.

I also want to touch on the historic outcome of yesterday's elections. Sunrun is well positioned to provide the country the power it needs.

Our plan is based on policies that are in place today, and does not depend on new policies. That said, yesterday's election paved the way to dramatically accelerate work with key state and federal policymakers to unleash the potential of dispatchable power and distributed compute at significant scale.

This includes advancing and scaling the use of distributed resources to participate fully alongside traditional power infrastructure. Sunrun can deliver the speed-to-power solutions America needs to support AI growth while strengthening energy affordability and reliability and creating new economic opportunities for customers and communities across the country.

Before handing over to Paul, I want to take a moment to celebrate some of our people who truly embrace our best-in-class team. For this quarter, I want to specifically highlight our team in Illinois.

In the third quarter, Illinois installations grew by over 30% compared to the prior year, with all systems including storage. I specifically want to thank Jordan LaPlace, Ahmad Zeid, and Kennedy Mott from our Illinois-based team.

Jordan has been with Sunrun for over a decade. We are so grateful for his commitment and leadership.

I also want to congratulate Ahmad and Kennedy, who were our top Illinois installers during the third quarter. To our entire team in Illinois, thank you, and keep up the great work.

Paul, over to you.

Thanks, Mary. Sunrun is in a great position.

We're leading the market with high-quality growth and establishing ways to provide our growing base of over 1 million customers even more value with additional products and services. First, I want to provide an update on what our sales teams are seeing and hearing on the ground with customers.

As energy costs and grid reliability continue to disappoint, customers are eager to lock in their energy cost with a predictable monthly bill and reliable backup power. We have built one of the strongest and most well-regarded sales organizations to capture the demand and convert it into satisfied customers.

Our sales have increased by high single digits to low double digits every month compared to the prior year from June through October. Our affiliate business has been reset.

We're working with a group that we're excited to grow with. These partners share our commitment to high-quality originations and a customer-centric approach.

We continue to selectively onboard partners that meet our high-quality standards. New customers are just one of the vectors for growth.

We're also actively growing our offering to existing customers. We're offering add-on batteries for existing customers and service plans for customers in need of a provider to help monitor and service their system.

We're also leveraging our growing fleet to increase recurring cash flow streams from grid service partnerships. One of the areas that we're increasingly excited about is the distributed compute opportunity.

Placing inference compute on customer sites, including for new homes, multifamily properties, and even single-family homes, presents a meaningful opportunity to rapidly scale compute resources and overcome the critical limiting factors for building data centers: power and location. Sunrun is uniquely advantaged given we inherently are co-locating compute with on-site power.

We launched a pilot this summer and continue to explore various opportunities to scale. I'll now turn it to Danny for the financial update.

Thank you, Paul. We added over 24,000 customers in Q3, with average system sizes up 2% from Q2.

We achieved a record high 75% storage attachment rate in Q3, up 1 point from Q2. Our volume performance in Q3 represents improved traction in our direct business.

Direct installation volumes were up by 17% from Q2, and up by 9% compared to the same period last year. Affiliate volume was up nearly 20% in Q3 compared to Q2, but down 67% year over year, driven both by our decisions to scale back our affiliate partnerships earlier in the year and by continued challenges in the dealer ecosystem.

We continue to expect volumes from the affiliate channel to be down by more than 60% for the full year. We expect our direct business volumes to comprise approximately 85% to 90% of our total installation volume mix for the year.

Aggregate contracted subscriber value was $1.2 billion in Q3. On a unit basis, contracted subscriber value was approximately $52,500, up 8% year over year, driven by larger average system sizes, increased pricing, a higher storage attachment rate, and a higher average ITC level, partially offset by a higher discount rate.

We estimate upfront gross proceeds will be approximately $49,600 per subscriber after applying an advance rate of 94% against aggregate contracted subscriber value. We estimate upfront net subscriber value of approximately $3,700, representing a margin as a percentage of contracted subscriber value of approximately 7%.

This figure increased by over 3 percentage points from last quarter. Cash generation was $6 million in Q3, or $56 million excluding $50 million of net investment in equipment safe harboring.

Cash generation is a non-GAAP metric. Please reference the earnings release and other associated Investor Relations materials published today for a reconciliation to its most directly comparable GAAP measure, cash provided by operating activities.

We have invested $100 million in our equipment safe harboring activities through the third quarter. In Q4, we expect to increase financing on these assets, resulting in a cash inflow that would reduce our net investment in safe harboring activities to approximately $60 to $70 million for the full year.

Turning now to our activity in the capital markets, Sunrun is executing well, and we have built a strong pipeline of transactions. We have seen accelerating demand for tax credits, with the vast majority of our 2026 tax credit supply spoken for with closed transactions or advanced discussions, and early engagement with potential buyers of 2027 credits has picked up materially.

We have seen ITC pricing during the quarter remain relatively stable in the high 80s to low 90 cent range. As of today, closed transactions and executed term sheets provide us with expected tax equity capacity or equivalent to fund approximately 980 megawatts of projects for subscribers beyond what was deployed through the third quarter.

We also have over $661 million in unused commitments available in our non-recourse senior revolving warehouse loan to fund over 269 megawatts of projects for retained subscribers as of the end of Q3. Year to date, we have raised approximately $1.5 billion in non-recourse asset-level debt financing.

We have seen credit spreads decline to the low 200 area, and continue to see robust demand for our securitizations in the private and public markets. Approximately 46% of our subscriber additions in Q3 were monetized through the non-retained or partially retained model.

As a reminder, proceeds from these transactions are equal to or better than our on-balance-sheet retained monetization while also providing simpler GAAP treatment and further diversification of capital sources. Under the joint venture structure, we retain a share of long-term cash flows from these assets along with grid services and the ability to cross-sell customers.

Turning to our outlook on slide 24, we have slightly reduced our volume outlook for the full year, driven by modestly lower pacing than we had forecasted earlier. Our direct sales growth rates in recent months have ranged from high single digits to low double digits year over year, but remain a few percentage points lower than we had previously forecasted.

In addition to these volume trends, sustained higher interest rates have also modestly impacted our expected full year 2026 results. Owing to these factors, we are revising our aggregate subscriber value guidance to approximately $4.6 billion for the full year compared to our prior guidance of $4.6 to $4.9 billion.

We are also revising our cash generation guidance to approximately $200 million for the full year before net investments in safe harbor equipment of $60 to $70 million. This compares to our prior guidance of $200 to $375 million.

We expect to produce meaningfully positive cash generation in 2027. There are a few puts and takes as we look out into next year.

Given the adjustments we made in the affiliate business earlier this year and the sales growth we are seeing in our direct business, we expect to grow overall installation volumes in 2027. The industry is facing a few new headwinds, including elevated ITC insurance costs, which impacts proceeds by a point or two.

The industry will also incur a property tax in California for new systems deployed starting January 1st, which Sunrun has already partially offset with recent pricing increases. To the extent interest rates are sustained at current levels, our capital costs would increase from levels realized throughout 2026.

We expect to increase prices further in 2027 as utility rates continue to rise. We will provide more details and formal 2027 guidance on our Q4 call in February.

We expect to continue to allocate cash generation to reduce parent leverage, and we'll provide further updates on this topic on our next call. In the coming quarters, we will evaluate additional value-accretive capital allocation strategies, depending on the market environment and our outlook.

Operator, you can now open the line for questions.

Hey guys, this is Arthur on for Julien. Thanks for taking our questions.

Just thinking about 2027 cash generation, I'm wondering how you think about price elasticity of demand. I know there's a lot of moving pieces here, but thinking through how much room you guys have to increase price while still growing volumes in '27, assuming interest rates sustain where they are today and you have some higher capital costs potentially to offset.

Maybe within that, if you could talk through the response to some of the recent price increases in California, that would be helpful as well.

Sure, great to hear from you. We expect our business to grow in 2027, and we are going to be focused on quality and margins.

We continue to see strong demand for the product. As we mentioned, we've already built in some of the pricing adjustments for some of the factors we discussed.

Danny, why don't you go into a little bit more detail?

I think we're taking a kind of a measured approach to the pricing increases, definitely observing utility rates, their trends. Of course, we operate in many geographies which have individual utility price trends, and we do have that diversification aspect of being able to also raise price in various geographies as we see those trends play out.

I'd say from a starting standpoint in 2026, we've actioned some pricing increases, mentioned California, a few other markets as well. I think we're seeing the fastest pace of rate growth in a few East Coast markets as well, and we've taken action there as well.

We continue to watch volume trends and we'll continue to calibrate to that all year into next year.

Great, thank you. Just a follow-up, more on the policy side, maybe just on this draft permitting bill.

There was some interesting language in there around behind-the-meter distributed energy systems, mandating wholesale market access there, which I think got a little bit overlooked at points in this bill. Just curious your thoughts on permitting reform in general, what it could mean for you, and maybe just some of this language on behind-the-meter DERs.

We are very supportive, as we view it as a durable and structural solution for integrating distributed power plants into demand response. We see the permitting bill as a very positive development.

It serves as a great bridge from state-funded programs where we've demonstrated effectiveness to permanently integrating distributed power plants into, as an example, California's Resource Adequacy program. In terms of impact, it's too early to know exactly, but we are very, very pleased directionally with what it means for the business.

Thank you, guys.

Hey, good afternoon, everyone. Thanks for taking the questions.

I guess on the Tesla Renew consortium, I'd be curious, I know it's only a quarter and a half old, but any updates or even customer engagement data points you can share on how that's going, maybe high level how we should also be thinking about how it'll play into your growth and potentially cash generation for 2027?

We're really pleased with it. We're already, as we cited, having many conversations about ways to deploy our resources together.

In fact, in this quarter, we also had that proof point with the PG&E Google deal, where the Tesla Renew Sunrun partnership was a key part of that announcement and a part of a Google-funded proof of concept. We saw that as very powerful.

We're very bullish on it. We're having some really good conversations that will bear fruit.

All right. Fair enough.

We'll keep tracking the progress. Maybe switching gears to the core business here.

It sounds like you're very encouraged and there's positive momentum behind the direct business. Now you've kind of gotten to a reset point on the affiliate channel segment that you seem happy with.

Is there any decision tree here where you decide to maybe fully exit the affiliate business, or what maybe the strategic rationale to keep some base level of exposure there as we think about kind of the growth pathway into '27? Then just in relation to that, is it fair to assume that you said 2027 you're expecting customer additions to grow year on year.

Is the first quarter where we kind of see year-on-year growth between both affiliate and direct be up year on year, maybe that's a 2Q event where we start to see the overall business go back into growth mode, given that's about the time you reset the affiliate business this year? Thank you.

I would say, when we did the reset, we were very clear that it was about working with partners that could meet our rigorous standards in delivering high-quality assets and a high-quality customer experience. We're pleased.

We've done that reset, we've got some great partners that we want to grow with, and we're looking forward to growing with them. Yes, we also do expect to see year-over-year growth.

Paul, why don't you talk a little bit specifically about that?

Yeah. We're seeing some really exciting pockets.

Markets like Illinois, Texas, New Jersey are growing greater than 25% year over year right now. We're picking up a lot of momentum in several of our most key markets.

I think on the affiliate side, as Mary said, it's a model that we like, but as the energy rate markets got more complex and our focus around customer compliance and delivering an excellent customer experience as we transitioned into being this independent power producer and playing at that broader scale became more important to us, our standards for that increased as well. No, there is no plan to exit the affiliate business altogether.

We are really excited about the group of partners we're working with. There's a queue of people that are under evaluation to add as well, and we're seeing some really good momentum out of that business with partners who have made the necessary adjustments to align to the standard of quality that we need.

It's likely that in Q2, all routes will be growing. From affiliate across all our direct routes.

That's kind of what I would expect from a year-over-year perspective going into and through 2027.

Okay. Appreciate all that.

That's a lot.

Hey guys, thanks for taking my questions. First one, with the election and the blue wave, wanted to just check in with you on your thoughts on the potential for an ITC extension with the new Congress.

Do you see a reasonable chance that that could happen? I know you've safe harbored a lot of volume, maybe from your standpoint it actually doesn't matter, but or at least maybe it doesn't impact your near-term '27, '28.

If there were an ITC extension, what do you think that could do for your business in the near term and medium term? Thanks.

Great question. As I mentioned, we're excited about the opportunity to find ways to accelerate our business.

I think there will be key opportunities with the election results to really accelerate the work we're already doing to unlock distributed power plant activities across the country, and that really is significant when you think about the shorter- and longer-term cash generation opportunity for Sunrun. That is, I would say that is first and foremost.

As you also know, we built the business to operate strong with existing policies and we're very prepared for that. From a logical perspective, does the kind of historic event we had last night suggest that things like that extension grow in likelihood?

I would say the answer is yes. From a Sunrun perspective, we're sitting in a great spot.

We're working with existing policies. We have a strong plan.

We have ways to create additional cash generation through our distributed power plant activities and other activities we're doing. I would say we're in a strong position no matter what happens, but that's not illogical for some to be making that kind of conclusion.

Great, thanks Mary. Then back on cash generation, I think you said in your prepared remarks that there could be meaningful growth or meaningful cash generation, not necessarily growth.

With the '27 outlook of having some growth, would you expect the rate of cash gen in '27 to mirror your subscriber growth in '27, or do you think there could be some operating leverage or leverage in general to drive that cash gen growth higher, faster than the subscriber growth? Thanks.

I think there's a balance of factors. Outlined a few of them on the call.

From a headline kind of unit volume growth perspective, operating cost leverage and just extra margin from more installation units is helpful. Of course, we're also balancing that with what's going on with interest rates, some of the more nuanced factors relating to ITC insurance and that market going through a moment of repricing.

Then we talked a little bit about on the earlier part of the call as well about continued kind of further pricing increases as we roll through the period. I'd say in terms of more specifics on the magnitude, we'd like to reserve on that until we can come with a range on the next call, which we plan to do.

Those are a few factors we're looking at at the moment.

Thanks, Danny. I'll pass it on.

Distributed power plants would be another factor next year as well.

Thanks so much, guys. Can you talk a little bit about the shifts that you've seen in the last month or so in the financing market, just given all the exposure into the data center market and some of the lack of capital availability due to that, the demand for data centers, and how that might shift here given what you seen with some of the moratoriums that passed yesterday?

The asset-level capital markets, just covering that, I would say, putting aside the change in base interest rates, I think we've actually seen directional improvement throughout the year, and I'd say that spans the debt capital markets, mostly the private and public securitization market for us, and the tax equity market, and specifically the ITC transfer market. All have directionally improved throughout the year.

Again, cost of capital also being offset by higher base rates. From a demand perspective, things have looked quite good.

The trailing area in the mix has been on the ITC transfer side, where we've noted kind of consistently there has been a flow of activity. It has been, going back to last year, second half of last year slower, first quarter picked up, second quarter more noticeably picked up, third and fourth quarter we're seeing a lot of buyer activity with very good engagement and lots of desire and appetite for people on their 2026 tax credit planning and lots of conversations around 2027 as well.

That has been looking like as you would expect if you pick up some of the external broker research covering that market as well. FEOC guidance is still out there.

We think, at this point, there's ample supply in the market that would generate more appetite for tax equity once that uncertainty clears up on the segment of buyers within the market that are impacted from it.

Excellent. Then now that you've seen a number of years of performance of the energy storage systems and incremental power management, as folks get more comfortable with the distributed power plant model, can you talk about shifts or needs that you're seeing from a hardware perspective to meet those needs more effectively, or vendors that you might want to get more levered to because performance is advantaged and you can do a few other things out with the portfolio level that impacts?

Yeah. One of the investments that we made pretty early on as we entered the distributed power plant space was to build our own connectivity and enter really thoughtful agreements with hardware providers, ensuring that we had the ability to deploy hardware and control the hardware in a way that would meet the needs of the utility companies requesting the power.

We actually feel like we have a very well-structured and nimble access to dispatch our power based on the varying needs of different offtakers.

We're really well positioned to, again, act as the nation's largest residential independent power producer. Like any IPP, we've built systems and structures so that we can respond in the grid requirements of different parts of the country, terms of speed, whether it's X minutes that you need to dispatch, etc.

We're really in a good position with the hardware we have, as Paul described.

I think it even goes with our investment partnership with Lunar, a lot of connectivity and collaboration there, great relationship with Tesla. The battery providers are really great partners in shared vision on accelerating the outcomes here with distributed power plants.

Great. Thanks, guys.

Hi, it's Ted on for Vic. Thanks for taking the question.

Just in terms of the cash generation guidance this year, in terms of the reduction, are you able just to parse out a little bit more how much of the reduction was from the lower volume outlook versus due to the higher rates? We would have expected a little bit of a larger impact from rates, just based on the disclosed sensitivities, but if any additional color there would be helpful.

I would say, going back to where we started out the year, the predominant factor here is on the change in volume outlook, much more so than rates. Rates did bear an impact, but the impact was gradual through the year, probably a bit more sudden when you look at Q3.

We're weighting that to partial-year periods, rates become a lesser impact. Again, the vast majority driver at this point would be volume.

Thank you.