HE Hawaiian Electric Industries 10-Q 2026-06-30 section summaries

Results and operating performance

HEI’s Q2 2026 revenue increased 25.9% to $939.703M from $746.392M. Operating income was $204.214M from $53.747M, and net income attributable to common stock was $123.200M from $26.085M; diluted EPS was $0.71 from $0.15. The earnings comparison was materially boosted by the Maui wildfire tort settlement remeasurement benefit, rather than reflecting only underlying operating improvement.

• Electric utility segment: Q2 revenue was $936.864M from $742.482M; common-stock net income was $137.858M from $39.150M. The segment’s operating income was $218.564M from $64.544M, including a $162.383M credit in wildfire tort-related claims expense.
• All other: Q2 revenue was $2.839M from $3.910M and common-stock net loss was $14.658M from $13.065M.
• Within the utility, Hawaiian Electric revenue was $681.861M from $524.804M and operating income was $170.679M from $49.710M; Hawaii Electric Light revenue was $123.975M from $110.973M and operating income was $24.467M from $9.256M; Maui Electric revenue was $131.568M from $107.757M and operating income was $21.274M from $4.277M.

H1 2026 HEI revenue was $1.686150B from $1.490462B, operating income $257.591M from $116.167M, and common-stock net income $153.650M from $52.756M. Hawaiian Electric H1 revenue was $1.680904B from $1.480848B, operating income $281.097M from $140.481M, and common-stock net income $173.201M from $86.966M. Its H1 wildfire-claim expense credit was $162.383M. Utility costs also rose: H1 fuel oil expense was $573.528M from $449.308M, purchased power $368.833M from $321.680M, and total expenses $1.399807B from $1.340367B. Q2 fuel oil expense was $336.615M from $210.587M and purchased power $223.559M from $174.963M.

Wildfire settlement, cash flow and balance sheet

The global tort settlement became effective April 10, 2026. HEI and Hawaiian Electric are responsible for approximately $1.99B, including $75M previously contributed to the One ‘Ohana Initiative, payable in four equal annual installments of $479M. The first installment was paid in April 2026; the remaining installments are due in April 2027–2029, with possible acceleration at a 5.5% discount rate. After settlement conditions were met, Hawaiian Electric reduced the remaining recorded liability from $1.44B to $1.30B, recognizing a $153.9M expense reduction, partly offset by $17.7M of accretion expense. At June 30, the liability was $410M current and $890M noncurrent. About $500M of proceeds is reserved for claimants who have not released claims; additional losses could exceed the recorded amount and available liquidity.

HEI H1 operating cash flow was a use of $350.369M from a source of $184.416M, while capital expenditures were $242.090M from $161.493M. Cash use included a $478.750M settlement payment and a $136.157M decrease in wildfire-related claims. Hawaiian Electric’s H1 operating cash flow was $91.493M from $216.246M, against capex of $241.810M from $159.950M—negative cash flow after capex of $150.317M, versus positive $56.296M. HEI shares outstanding increased from 172.620M at December 31, 2025, to 172.728M at June 30, 2026.

At June 30, HEI had $8.401802B of total assets and $1.762887B of total shareholders’ equity, versus $8.922879B and $1.605919B, respectively, at year-end. Goodwill and intangible assets other than goodwill were not separately reported in the summarized balance-sheet information. HEI cash and cash equivalents were $238.732M, down from $501.778M; restricted cash was $0.218M, down from $478.968M. HEI long-term debt, net, was $2.265630B, versus $2.285016B. Hawaiian Electric had $8.169890B of total assets and $1.866258B of common stock equity; its long-term debt, net, was $2.058431B. HEI’s $850M consolidated revolving capacity and Hawaiian Electric’s stated $625M of available capacity across facilities were undrawn; the companies reported covenant compliance.

Regulation, investment and other exposures

The PUC authorized deferral of certain incremental, non-labor wildfire costs, but deferral does not guarantee recovery. Hawaiian Electric had $80.5M of such regulatory assets and $21.4M for wildfire mitigation plan costs, both subject to recovery proceedings and prudence review. The 2025–2027 wildfire mitigation plan has up to $350M of approved project-cost recovery through EPRM, conditioned on the PUC addressing securitization first; costs incurred by June 30 were approximately $101M. HEI also recorded a $139.4M net wildfire-related benefit in Q2 2026, versus a $5.2M net expense in Q2 2025.

Utility investment is increasing: H1 capex rose substantially, and construction in progress reached $537.695M from $382.147M. The Waiau repower would replace six turbines with 253 MW of firm generation, with staged service expected in 2029–2033. Its revised estimate was $1.16B, while the PUC-approved recovery basis was an adjusted $908M; recovery above that amount may require a later rate proceeding. The five-year grid resilience program has an estimated cost of $189.7M, with EPRM recovery capped at $95M. A proposed $170M annual target-revenue increase for the next multi-year rate period requires a new application, filed July 2026.

Pacific Current continued its portfolio exit: Mahipapa, its remaining operating subsidiary, was held for sale, with a $3.7M Q2 impairment. At June 30, assets held for sale were $52.248M and liabilities $60.998M. Separately, property-insurance recovery remains uncertain: $9.6M had been received against submitted claims under $500M of coverage; disputes continue, with an amended complaint seeking approximately $40.7M.

Financial performance

HEI’s Q2 2026 consolidated revenue was $939.703M, up from $746.392M in Q2 2025; operating income was $204.214M, up from $53.747M; and net income attributable to common stock was $123.200M, up from $26.085M. For H1 2026, revenue was $1.68615B, up from $1.490462B; operating income was $257.591M, up from $116.167M; and net income attributable to common stock was $153.650M, up from $52.756M.

The sharp earnings improvement largely reflects a $153.870M reduction in expense from remeasuring the remaining Maui wildfire settlement liability at present value. The benefit was partly offset by $17.714M of accretion expense, higher average debt and lower interest income after the April settlement payment. H1 net income also benefited from lower prior-year impairment and subsidiary-sale losses. Effective tax rates declined to 25% in Q2 from 34%, and to 24% in H1 from 27%, mainly due to fewer discrete tax impacts.

Electric utility net income for common stock was $138M in Q2 2026, versus $39M, and $173M in H1, versus $87M. All other net loss was $14.658M in Q2, versus $13.065M, and $19.551M in H1, versus $34.210M. Lower Pacific Current sales drove All other’s revenue decline; its Q2 loss worsened mainly on higher corporate wildfire legal and other expenses.

Wildfire settlement, funding and liquidity

From August 8, 2023 through June 30, 2026, HEI and subsidiaries incurred approximately $2.14B of wildfire-related expenses, including estimated settlement costs, One ‘Ohana Initiative contributions and $47.8M for the securities class-action settlement. The first of four equal annual $479M settlement installments was paid April 10, 2026. At June 30, Hawaiian Electric classified $410M of wildfire liabilities as current and $890M as noncurrent. The company reported a Q2/H1 2026 net wildfire-related benefit of $139.403M/$138.720M, versus net expense of $5.157M/$9.685M in the comparable 2025 periods. Unpaid excess- and professional-liability insurance proceeds had been recovered; about $71M of D&O coverage remained after retentions and expected recoveries.

At June 30, HEI consolidated had $2.3B of long-term debt and $239M cash. Its reported $1.339B available liquidity comprised $550M of utility credit availability, $300M of HEI revolving capacity, $250M of ATM equity capacity and $239M cash. Hawaiian Electric separately reported $811M available liquidity: $186M cash and $625M undrawn facilities. Neither HEI nor Hawaiian Electric had revolving-credit draws or commercial paper outstanding. HEI’s capital structure was $2.266B long-term debt, net, including current portion (56%), and $1.763B common equity (44%), compared with $2.410B debt and $1.606B equity at December 31, 2025. Hawaiian Electric had $2.058B long-term debt and $1.866B common equity; no debt was due or expected to be repaid within 12 months.

H1 Hawaiian Electric operating cash flow was $91.493M, down from $216.246M; investing cash outflow was $239.697M, versus $154.799M; and financing cash outflow was $151.757M, versus $139.166M. Higher fuel-inventory payments and customer bills associated with fuel prices reduced operating cash flow; construction-related expenditures increased investing outflows. HEI consolidated also reported H1 operating, investing and financing cash uses of approximately $350M, $240M and $151M, respectively. HEI’s common dividend remains suspended; Hawaiian Electric paid HEI $11M in each of Q1 and Q2 2026. HEI is developing a financing plan for remaining settlement payments, but raising the required capital is not assured. Its September 2024 issuance of 62.2M shares generated approximately $557.7M net proceeds.

Utility operations and transition

Electric utility Q2 fuel-oil expense rose to $337M from $211M, and purchased-power expense to $224M from $175M. H1 fuel expense was $574M versus $449M, and purchased power $369M versus $322M. These costs are generally passed through to customers, but collection timing increases working-capital needs. Fuel oil cost per barrel rose to $145.67 from $100.40 in Q2 and $119.71 from $102.56 in H1. Crude oil prices increased 51.9% year over year in Q2. Q2 electricity sales declined 0.8%, while H1 sales were 3,987M kWh versus 3,997M. Utility ROACE for the 12 months ended June 30 was 15.0%, versus 3.7% a year earlier, but rate-making returns varied: Hawaiian Electric 9.15%, Hawaii Electric Light 7.67% and Maui Electric 3.05%, each below the 9.50% allowed return except Hawaiian Electric’s result was close. The PUC suspended the earnings-sharing mechanism.

Wildfire prevention, rebuilding and grid reliability are major demands on capital. The PUC approved estimated $350M of Exceptional Project Recovery Mechanism cost recovery. The Utilities’ mitigation program includes system hardening, inspections, vegetation management and public-safety power shutoffs, which can cause extended outages. Maui Electric’s Lahaina rebuild costs remain unknown and could be significant.

Renewable-project delays, inflation, supply-chain and tariff risks, and possible loss of federal tax credits have pushed the planned 70% generation-emissions reduction beyond its original 2030 target. The Utilities estimate emissions were about 25% below 2005 levels in 2025, versus 27% in 2024, but still expect to meet or exceed 2030 RPS goals and retain a net-zero power-generation goal by 2045 or sooner. RPS reached 36.8% in 2025, earning a $1.9M incentive; a shortfall against mandates could trigger penalties. Of 11 Stage 2 PPAs, six were declared void by developers and one mutually terminated; five remaining Stage 2 contracts and self-build projects total 79 MW PV and 304 MW/1,168 MWh battery storage. The PUC declined to expedite a proposed 500 MW Oahu firm-generation proceeding absent a demonstrated need. The Utilities’ July 2026 retail-wheeling pilot order also leaves grid-cost allocation, fees and consumer protections unresolved.

HEI is shifting toward the Utilities as its sole operating companies: after PUC approval subject to commitments, employees moved to Hawaiian Electric in June 2026, with shared executives and boards. As of July 31, ratings remained below investment grade: Moody’s rated HEI Ba2 and Hawaiian Electric Ba1; S&P rated both BB−; Fitch rated HEI B+ and Hawaiian Electric BB−. These ratings, together with remaining settlement installments, fuel and working-capital needs, and wildfire-related capital spending, constrain financing flexibility.

HEI and Hawaiian Electric reported no significant changes in their exposure to market risk during the quarter ended June 30, 2026. For a description of their market-risk exposures, the filing refers readers to Part II, Item 7A, page 62 of the 2025 Form 10-K.

Controls and Procedures

HEI and Hawaiian Electric management, including each company’s CEO and CFO, concluded that disclosure controls and procedures were effective at the reasonable-assurance level as of the end of Q2 2026. Neither company reported changes during the quarter that materially affected, or were reasonably likely to materially affect, internal control over financial reporting. This section reports no financial results or other business developments.

Risk Factors

This section provides no specific risk disclosures, financial metrics, or business developments. It directs readers to HEI’s and Hawaiian Electric’s 2025 Form 10-K, pages 14–26, for risk factors. Related information is also referenced in this filing’s MD&A, quantitative and qualitative disclosures about market risk, condensed consolidated financial statements, and cautionary note regarding forward-looking statements (pages iv–vi).

Trading Arrangements and Bylaw Amendments

• During Q2 2026 (the three months ended June 30, 2026), no director or officer of HEI or Hawaiian Electric adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement.
• Effective August 5, 2026, the boards of both companies amended and restated their bylaws to establish the CEO role and transfer certain authority and responsibilities from the president to the CEO. The transferred matters include shareholder meetings and the appointment, removal, duties, and compensation of subordinate officers.

No financial results or metrics were reported in this section.