HAWAIIAN ELECTRIC INDUSTRIES INCHE
HAWAIIAN ELECTRIC INDUSTRIES INC Segments Disclosure
Note 3 · Segment financial information | ||
Reportable segments are strategic business units of the Company that offer different products and services and operate in different regulatory environments. Prior to December 31, 2024, the Company operated and reported on two reportable segments: Electric utility and bank. On December 31, 2024, the Company sold 90.1% of ASB (previously, the bank reportable segment) and presented its results as discontinued operations for all periods presented. Accordingly, the bank reportable segment has been eliminated and the segment information presented herein excludes the results of ASB for all periods presented. All comparable information for the historical periods has been recast to reflect the impact of these changes. The Company now operates and reports on one reportable segment: Electric utility. HEI and its other subsidiaries which are not reportable segments are grouped and reported as an “All Other” non-reportable segment.
The accounting policies of the segments are the same as those described for the Company in the summary of significant accounting policies, except as otherwise indicated and except that federal and state income taxes for each segment are calculated on a “stand-alone” basis. The Company’s chief operating decision makers (CODMs) evaluate segment performance based on net income. Each segment accounts for intersegment sales and transfers as if the sales and transfers were to third parties (i.e., at current market prices). Intersegment revenues consist primarily of Hamakua Energy electricity revenues, interest and preferred stock dividends.
HEI’s CODM is its Chief Executive Officer. The CODM uses net income to evaluate income generated from segment assets (return on assets) in deciding whether to reinvest profits into the segments or into other parts of the entity, such as for acquisitions or to pay HEI common stock dividends. The CODM considers inputs from a variety of sources including the Chief Financial Officer, the General Counsel and presidents of operating units. Net income is used to monitor budget versus actual results. The CODM also uses net income in competitive analysis by benchmarking to HEI’s competitors. The competitive analysis along with the monitoring of budgeted versus actual results are used in assessing performance of the segment and in establishing management’s compensation. The segment level information that is regularly provided to the CODM does not include expense categories other than depreciation and amortization, interest expense, and income taxes.
| Electric utility | ||
Hawaiian Electric and its wholly owned operating subsidiaries, Hawaii Electric Light and Maui Electric, are public electric utilities in the business of generating, purchasing, transmitting, distributing and selling electric energy on all major islands in Hawaii other than Kauai, and are regulated by the PUC. Hawaiian Electric, Hawaii Electric Light, and Maui Electric are aggregated within the electric utility segment because they: (1) are involved in the business of supplying electric energy in the same geographical location (i.e., the State of Hawaii), (2) have similar production processes that comprise electric generation, (3) serve similar customers within their franchise territories (e.g., residential, commercial and industrial customers), (4) use similar electric grids to distribute the energy to their customers, (5) are regulated by the PUC and undergo similar rate-making processes, (6) have similar economic characteristics and (7) perform financial reporting oversight and management of the business at the consolidated level. Hawaiian Electric also owns the following nonregulated subsidiaries: Renewable Hawaii, Inc. (RHI), which was formed to invest in renewable energy projects; HE AR INTER LLC (HE AR INTER), which was formed to pursue financing through a secured asset-based (accounts receivable) credit facility. Both RHI and HE AR INTER are included within electric utility segment information provided to the CODMs.
Hawaiian Electric has determined that its CODMs are the Chief Executive Officer and Chief Financial Officer. Net income variance analysis is regularly provided to CODMs and it is used to monitor budget as well as measuring against performance to the same period in the previous year. The CODMs measure the segment performance based on the Hawaiian Electric consolidated net income and segment net income of Hawaii Electric Light and Maui Electric to make decisions to allocate resources. Hawaiian Electric concluded that all of the expense categories for its single reportable segment included in the Consolidated Statement of Income for Hawaiian Electric are the expense categories regularly provided to the CODMs and are significant.
All Other | ||
“All Other” includes amounts for the holding companies (HEI and ASB Hawaii), GLST1, and Pacific Current and its operating subsidiary and do not meet the definition of reportable segments.
ASB Hawaii. ASB Hawaii was formed in 1988 and served as the holding company for ASB prior to its sale on December 31, 2024. ASB Hawaii still retains a 9.9% noncontrolling investment in ASB.
GLST1. HEI transferred the amount of the first payment, $479 million, into a new subsidiary, GLST1, which is restricted from disbursing such funds except in connection with the initial payment to the settlement funds. Effective March 31, 2025, HEI assigned 60% of the membership interests of GLST1 to Hawaiian Electric. As of December 31, 2025, the assigned equity interests total $287.3 million, which is reported on “Investment in unconsolidated affiliate” on the Utilities’ Consolidated Balance Sheets.
Pacific Current. Pacific Current was formed in 2017 to focus on investing in non-regulated renewable energy and sustainable infrastructure in the State of Hawaii to help achieve the state’s sustainability goals. As part of HEI’s comprehensive review of strategic options for Pacific Current, significant investments of Pacific Current that were made through its subsidiaries, Hamakua Energy, Mauo and Kaʻieʻie Waho were sold in 2025. As of December 31, 2025, Mahipapa is Pacific Current’s remaining operating subsidiary.
Sale of Hamakua Holdings, LLC. On March 10, 2025, Pacific Current closed on the sale of Hamakua Holdings, LLC (Hamakua Holdings), a then wholly owned subsidiary of Pacific Current, to an unaffiliated third party for cash consideration (Hamakua Sale). Hamakua Holdings had two wholly owned subsidiaries: Hamakua Energy, and HAESP, LLC (created in connection with the current on-going Stage 3 RFP process). Hamakua Energy owned a 60-MW combined cycle power plant on Hawaii Island that provides electricity to Hawaii Electric Light under an existing PPA that expires in 2030. As a result and effective as of the closing of the Hamakua Sale, Pacific Current no longer owns either of Hamakua Energy or HAESP, LLC, as wholly owned subsidiaries of Hamakua Holdings. The Company recorded a loss on the sale amounting to $13.2 million as of March 31, 2025, which is included in “Loss on sales of subsidiaries and equity-method investments and impairment loss on assets sold and held for sale” in the Company’s Consolidated Statements of Income for the year ended December 31, 2025.
Sale of solar and Battery Energy Storage System (BESS) facilities. Effective August 1, 2025, HEI closed on the sale of its solar and BESS assets to an unaffiliated third party for cash consideration (Solar Asset Disposition). The Solar Asset Disposition was completed through the sale of the membership interests in Pacific Current, Solar and Storage Operating Company, LLC (PC Opco), a then newly created indirect subsidiary of Pacific Current, which owned all of the membership interest of Pacific Current’s solar and BESS project companies: Mauo, LLC (which owns solar-plus-storage projects totaling 8.6 MW on five University of Hawaii campuses on Oahu and Maui), Kaʻieʻie Waho Company, LLC (which owns a 6-MW solar photovoltaic system that provides renewable energy to Kauai Island Utility Cooperative), Upena, LLC (which owns a solar asset on Oahu) and Alenuihaha Developments, LLC (which owns a collection of renewable energy assets on Oahu and Kauai) (collectively, Project Companies). As a result of the Solar Asset Disposition, effective as of August 1, 2025, Pacific Current no longer owns the Project Companies. The Company recorded an immaterial gain on the Solar Asset Disposition as of September 30, 2025, which is included in “Loss on sales of subsidiaries and equity-method investments and impairment loss on assets sold and held for sale” in the Company’s Consolidated Statements of Income for the year ended December 31, 2025.
In the second quarter of 2025, the Company evaluated the carrying value of the net assets of Pacific Current’s solar/BESS and biomass facilities and concluded the net assets were impaired as of June 30 2025. As a result, the Company recognized a pretax impairment charge of $0.2 million and tax expense and an expected investment tax credit recapture of $5.3 million. The pretax impairment charge is included in “Loss on sale of subsidiaries and equity-method investments and impairment loss on assets sold and held for sale” and the taxes on the impairment and expected investment tax credit recapture is included in “Income tax expense (benefit)” in the Company’s Consolidated Statements of Income for the year ended December 31, 2025.
Assets held for sale-Mahipapa. In addition, in connection with the Solar Asset Disposition and as part of the membership interest purchase agreement pursuant to which the Solar Asset Disposition was conducted (MIPA), but as a separate transaction, Pacific Current agreed to sell all of the membership interest in its biomass subsidiary, Mahipapa, LLC, to the same unaffiliated third party that is party to the MIPA (the Mahipapa Sale), with each of the parties’ obligations to complete the Mahipapa Sale subject to the conditions set forth in the MIPA. Mahipapa owns a 7.5-MW renewable, firm dispatchable closed-loop biomass-
to-energy facility on Kauai that provides electricity to Kauai Island Utility Cooperative under a PPA that expires in January 2036.
The net assets of Mahipapa are classified as held for sale in the Company’s Consolidated Balance Sheets as of December 31, 2025. The net assets were classified as current, and are summarized as follows:
| (in thousands) | December 31, 2025 | ||||
| Property, plant and equipment, net of accumulated depreciation | $ | 46,286 | |||
| Other assets | 9,980 | ||||
| Assets held for sale-current | $ | 56,266 | |||
| Long-term debt, net | $ | 51,568 | |||
| Other liabilities | 8,235 | ||||
| Liabilities held for sale-current | $ | 59,803 | |||
Electric utility reportable segment and All Other information were as follows:
| (in thousands) | Electric utility | All Other | Total | ||||||||||||||
| 2025 | |||||||||||||||||
| Revenues | $ | 3,071,182 | $ | 15,714 | $ | 3,086,896 | |||||||||||
| Depreciation and amortization | 294,205 | 4,714 | 298,919 | ||||||||||||||
| Interest income | 9,463 | 27,466 | 36,929 | ||||||||||||||
| Interest expense, net | 93,702 | 23,632 | 117,334 | ||||||||||||||
Income (loss) from continuing operations before income taxes | 220,588 | (53,659) | 166,929 | ||||||||||||||
Income tax expense (benefit) | 49,033 | (8,385) | 40,648 | ||||||||||||||
Income (loss) from continuing operations | 171,555 | (45,274) | 126,281 | ||||||||||||||
Dividends and loss on redemption of preferred stock of subsidiaries | 3,340 | (179) | 3,161 | ||||||||||||||
Income (loss) from continuing operations for common stock | 168,215 | (45,095) | 123,120 | ||||||||||||||
Capital expenditures1 | 339,573 | 1,629 | 341,202 | ||||||||||||||
| Assets (at December 31, 2025) | 8,530,520 | 392,359 | 8,922,879 | ||||||||||||||
| 2024 | |||||||||||||||||
| Revenues | $ | 3,206,700 | $ | 13,150 | $ | 3,219,850 | |||||||||||
| Depreciation and amortization | 282,970 | 10,563 | 293,533 | ||||||||||||||
| Interest income | 6,633 | 12,729 | 19,362 | ||||||||||||||
| Interest expense, net | 82,082 | 45,125 | 127,207 | ||||||||||||||
Loss from continuing operations before income taxes | (1,663,914) | (127,681) | (1,791,595) | ||||||||||||||
Income tax benefit | (439,547) | (31,415) | (470,962) | ||||||||||||||
Loss from continuing operations | (1,224,367) | (96,266) | (1,320,633) | ||||||||||||||
| Preferred stock dividends of subsidiaries | 1,995 | (105) | 1,890 | ||||||||||||||
Loss from continuing operations for common stock | (1,226,362) | (96,161) | (1,322,523) | ||||||||||||||
Capital expenditures1 | 329,479 | 14,772 | 344,251 | ||||||||||||||
| Assets (at December 31, 2024) | 7,613,604 | 1,317,812 | 8,931,416 | ||||||||||||||
| 2023 | |||||||||||||||||
| Revenues | $ | 3,269,521 | $ | 17,982 | $ | 3,287,503 | |||||||||||
| Depreciation and amortization | 270,195 | 12,111 | 282,306 | ||||||||||||||
| Interest income | 6,454 | 2,651 | 9,105 | ||||||||||||||
| Interest expense, net | 86,140 | 39,392 | 125,532 | ||||||||||||||
Income (loss) from continuing operations before income taxes | 247,140 | (64,840) | 182,300 | ||||||||||||||
Income tax expense (benefit) | 51,193 | (16,659) | 34,534 | ||||||||||||||
Income (loss) from continuing operations | 195,947 | (48,181) | 147,766 | ||||||||||||||
| Preferred stock dividends of subsidiaries | 1,995 | (105) | 1,890 | ||||||||||||||
Income (loss) from continuing operations for common stock | 193,952 | (48,076) | 145,876 | ||||||||||||||
Capital expenditures1 | 438,775 | 3,952 | 442,727 | ||||||||||||||
Assets (at December 31, 2023) | 7,283,554 | 393,818 | 7,677,372 | ||||||||||||||
1 Contributions in aid of construction balances are included in capital expenditures.
Intercompany electricity sales of the Utilities to HEI and its other subsidiaries are not eliminated because those entities would need to purchase electricity from another source if it were not provided by the Utilities and the revenue and profit on such sales is nominal.
Sales from Hamakua Energy, LLC (Hamakua Energy) to Hawaii Electric Light (a regulated affiliate), up until the close of its sale on March 10, 2025, are eliminated in consolidation (see “related-party transactions” in Note 4).
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 27, 2026 | Showing above |
| 2024 | Feb 24, 2025 | |
| 2023 | Feb 29, 2024 | |
| 2022 | Feb 27, 2023 | |
| 2021 | Feb 25, 2022 | |
| 2020 | Feb 26, 2021 | |
| 2019 | Feb 28, 2020 | |
| 2018 | Feb 28, 2019 | |
| 2017 | Mar 1, 2018 | |
| 2016 | Feb 24, 2017 | |
| 2015 | Feb 23, 2016 | |
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.