Hawaiian Electric Industries Inc
Q2 2026 Earnings
GAAP EPS of $0.71 includes a $101 million after-tax non-cash gain ($153.9 million pre-tax) from remeasuring the remaining Maui wildfire settlement liability to present value, net of $13.2 million after-tax ($17.7 million pre-tax) accretion expense. Also excludes $3.716 million pre-tax loss on sale of subsidiary/asset impairment related to Pacific Current strategic review.
Market Reaction
S&P 500 over the same 30 days: −1.97%.
Did HE Beat Earnings? Q2 2026 Results
Hawaiian Electric Industries posted a disappointing second quarter, with adjusted earnings of $0.13 per share missing the $0.17 consensus estimate by 23.53%, as higher interest expense and rising operating costs weighed on the utility's core performance. Revenue climbed 25.9% year-over-year to $939.70 million, though that gain largely reflected higher fuel oil costs passed through to customers rather than underlying demand growth, with kilowatt-hour sales essentially flat at 2,015 million units. The headline GAAP result of $0.71 per share was heavily distorted by a $153.87 million pre-tax non-cash gain tied to remeasuring the remaining Maui wildfire settlement liability after the settlement agreement was finalized in April 2026, a one-time benefit that will be offset over time by future accretion expense as payments come due. Looking ahead, management cautioned that 2026 adjusted operating costs will significantly exceed inflation, pressured by higher insurance premiums, vegetation management, and cybersecurity investments, with relief expected only after a 2027 rate rebasing proceeds. Analyst sentiment heading into the report leaned bearish, with prevailing price targets below current trading levels.
- Non-cash gain of $153.9 million pre-tax from remeasuring remaining Maui wildfire settlement liability to present value
- $9 million of insurance recoveries recognized as adjustment to tort-related legal claims
- $8 million higher revenues primarily from the annual revenue adjustment mechanism
- Higher fuel oil costs per barrel ($145.67 vs $100.40 YoY) driving higher pass-through revenue
- Higher interest expense including $18 million of accretion expense on settlement liability
- Higher O&M driven by generation, transmission, distribution costs, labor, and employee benefits
“In June we filed our annual action plan update to our IGP, laying out immediate actions necessary to meet customers' growing energy needs while improving reliability, resilience and affordability. These actions include using competitive procurements for all types of generation to attract the lowest pricing for customers, and on July 17 we submitted our IGP Request for Proposals to the PUC. We are seeking to procure nearly 1,650 gigawatt-hours of variable renewable energy, 465 megawatts of grid forming resources and 111 megawatts of firm generating capacity. The proposed procurement is one of our largest ever, and would help us build a portfolio that meets the requirements of reliability and lower carbon emissions at the least cost to customers.”
Hawaiian Electric CEO, on the earnings call
Forward Guidance & Outlook
Hawaiian Electric expects 2026 adjusted O&M excluding pension to significantly outpace inflation as the company progresses through a transitional year ahead of a 2027 rate rebasing. Key cost headwinds include higher insurance premiums (reflecting deferral treatment of wildfire insurance premiums prior to 2026), storm response expenses from severe weather in February and March, higher vegetation management expenses, higher overhauls and station maintenance expenses, higher IT costs for cyber defenses, and higher labor and benefits costs. A maximum Fuel Cost Risk Sharing penalty of approximately $3.7 million pre-tax is expected. The Q2 settlement remeasurement benefit will be offset over time by future interest accretion expense as the liability increases toward the full settlement amount when payments become due. The company's proposed rate rebasing and proposed PBR framework modifications are intended to address many of the higher O&M costs.
HE YoY Financials
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Figures from SEC filings and company reports. Not investment advice.