Pinnacle West Reports Lower 2026 Second-Quarter Financial Results Compared to a Year Ago
Key Terms
cooling degree days technical
weather-normalized financial
dispatchable energy technical
- Lower second-quarter financial results align with company expectations as operating performance, reliability remain strong
- Robust customer growth and increased energy demand driven by early summer heat
- Customer support and financial assistance resources enhanced for peak summer season
The 2026 quarterly results reflect a decrease of about
“Summer arrived early this year, with temperatures reaching 105° F back in March. As a result, our customers turned on their air conditioners sooner than usual and continued using them heavily even after temperatures returned to levels similar to last year,” said Pinnacle West Chairman, President and Chief Executive Officer Ted Geisler, citing a
Operationally, Geisler said Arizona Public Service Co. (APS) employees delivered strong performance throughout the second quarter, maintaining reliable service during extreme summer heat and increased energy demand. During the period, APS achieved robust residential customer growth of
Supporting Customers Through the Summer
While APS remains focused on delivering safe, reliable power throughout the summer, the company is also expanding existing programs and resources to help customers manage higher seasonal energy bills. As
Bringing APS’s customer-first commitment to life, Geisler highlighted a recent example of APS employees going above and beyond to support some of the company’s most vulnerable customers:
Ahead of a planned outage in
“When residents shared concerns about how a planned outage could affect their community, our employees took the time to listen and respond,” said Geisler. “By providing personalized outreach, answering questions, verifying customer information, sharing preparedness resources and connecting residents with APS assistance programs, we were able to better support customers and strengthen trust within the community. The experience also helped us identify opportunities to improve future outreach and communication with customers who may need additional support.”
Enhancing the APS Safety Net Program
APS also enhanced its Safety Net program that expands support for customers and their designated emergency contacts. The updated program provides earlier notifications about past-due bills, potential disconnection notices and outages. This added awareness can help customers avoid service interruptions and connect with available support sooner. APS also expanded enrollment opportunities through customer service interactions and digital channels, making participation more accessible.
Additionally, APS offers financial assistance programs, including discounts of up to
Customers are encouraged to visit aps.com/save for a full list of assistance programs or call (602) 371-7171 or (800) 253-9405 for support, available 24/7 in English and Spanish. APS’s call center answers
Strengthening Reliability for Customers
Supporting customers extends beyond assistance programs and outage preparedness, added Geisler. APS also is investing in the infrastructure and resources needed to provide the reliable energy service customers count on at the lowest cost possible.
Toward that end, APS recently announced plans to convert two retired coal-fired units at the Cholla Power Plant near
Financial Outlook
For 2026, the Company continues to estimate its consolidated earnings will be within a range of
Conference Call and Webcast
Pinnacle West invites interested parties to listen to the live webcast of management’s conference call to discuss the company’s financial results and recent developments, and to provide an update on the company’s longer-term financial outlook, at noon ET (9 a.m.
General Information
Pinnacle West Capital Corp., an energy holding company based in
Dollar amounts in this news release are after income taxes. Earnings per share amounts are based on average diluted common shares outstanding. For more information on Pinnacle West’s operating statistics and earnings, please visit pinnaclewest.com/investors.
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements based on current expectations. These forward-looking statements are often identified by words such as "estimate," "predict," "may," "believe," "plan," "expect," "require," "intend," "assume," "project," "anticipate," "goal," "seek," "strategy," "likely," "should," "will," "could," and similar words. Because actual results may differ materially from expectations, we caution readers not to place undue reliance on these statements. A number of factors could cause future results to differ materially from historical results, or from outcomes currently expected or sought by Pinnacle West or APS. These factors include, but are not limited to:
- our ability to achieve timely and adequate rate recovery of our costs through our regulated rates and adjustor recovery mechanisms, including returns on and of debt and equity capital investment;
- the impacts of federal, state, and local laws, judicial decisions, statutes, regulations, and FERC, NRC, EPA, ACC, and other agency requirements, including as they are changed by legislative and regulatory action as well as executive orders, such as those relating to tax, environment, energy, nuclear plants, and deregulation of the retail electric market;
- our operation of Palo Verde is subject to substantial regulatory oversight and potentially significant liabilities and capital expenditures;
- we are subject to numerous environmental laws and changes to existing laws, or new laws, may increase our costs and impact our business;
- the potential effects of climate change on our electric system, including as a result of weather extremes, such as prolonged drought and high temperature variations in the area where APS conducts its business, as well as the impacts of policy and regulatory changes introduced to address climate change;
- co-owners of our jointly owned generation and transmission facilities may have unaligned goals;
- the willingness or ability of counterparties, participants, and landowners to meet contractual or other obligations or extend the rights for continued generation and transmission operations;
- deregulation of the electric industry and other factors, such as large customers developing large, utility scale generation to serve their energy needs, may result in increased competition;
- variations in demand for electricity, including those due to weather, seasonality (including large increases in ambient temperatures), the general economy or social conditions, customer and sales growth (or decline), data center growth (or lack thereof), including to support the AI industry, the effects of energy conservation measures and DG, and technological advancements;
- wildfires, including those arising as a result of climate change, extreme weather events, or the expansion of the wildland urban interface;
- generation, transmission, and distribution facilities and system operating costs, conditions, performance, and outages;
- our ability and efforts to meet current and anticipated future needs for generation and transmission and distribution facilities in our region at reliable levels, including factors affecting our ability to acquire and develop new resources to serve this load as well as difficulties in accurately forecasting load growth, particularly from high load energy users;
- availability of fuel and water supplies as well as the volatility and costs of fuel and purchased power;
- the direct or indirect effect on our facilities or business from cybersecurity threats or intrusions, data security breaches, terrorist attack, physical attack, severe storms, or other catastrophic events, such as fires, explosions, pandemic health events, or similar occurrences;
- risks inherent in the operation of nuclear facilities, including spent fuel disposal uncertainty;
- the development of new technologies and the impact they have on the retail and wholesale electricity market and the impacts of our adoption or failure to adopt such technologies;
- the availability and retention of qualified personnel and the need to negotiate collective bargaining agreements with union employees;
- the cost of debt, including increased cost as a result of rising interest rates, and equity capital and our ability to access capital markets when required as well as the impacts a credit rating downgrade would have on us;
- the investment performance of the assets of our nuclear decommissioning trust, captive insurance cell, coal mine reclamation escrow, pension, and other postretirement benefit plans, and the resulting impact on future funding requirements;
- Pinnacle West’s cash flow depends on the performance of APS and its ability to make dividends and distributions;
- potential shortfalls in insurance coverage;
- Pinnacle West’s ability to meet its debt service obligation could be adversely affected because its debt securities are structurally subordinated to the debt securities and obligations of its subsidiaries;
- the liquidity of wholesale power markets and the use of derivative contracts in our business;
- policy changes in Arizona or other states through ballot initiatives or referenda may increase our cost or operations or affect our business plans;
- general economic conditions, such as tariffs, inflation, and other supply chain constraints, as well as uncertainties associated with the current and future economic environment and conditions in Arizona; and
- disruptions in financial markets could adversely affect our cost of and access to credit and capital markets.
These and other factors are discussed in the most recent Pinnacle West/APS Form 10-K and 10-Q along with other public filings with the Securities and Exchange Commission, which readers should review carefully before placing any reliance on our financial statements or disclosures. Neither Pinnacle West nor APS assumes any obligation to update these statements, even if our internal estimates change, except as required by law.
| PINNACLE WEST CAPITAL CORPORATION | |||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF INCOME | |||||||||||||||
| (unaudited) | |||||||||||||||
| (dollars and shares in thousands, except per share amounts) | |||||||||||||||
| THREE MONTHS ENDED | SIX MONTHS ENDED | ||||||||||||||
| JUNE 30, | JUNE 30, | ||||||||||||||
|
2026 |
|
|
|
2025 |
|
|
|
2026 |
|
|
|
2025 |
|
|
| Operating Revenues | $ |
1,455,749 |
|
$ |
1,358,751 |
|
$ |
2,605,346 |
|
$ |
2,391,031 |
|
|||
| Operating Expenses | |||||||||||||||
| Fuel and purchased power |
|
558,498 |
|
|
477,008 |
|
|
995,227 |
|
|
857,079 |
|
|||
| Operations and maintenance |
|
283,387 |
|
|
286,605 |
|
|
560,087 |
|
|
586,714 |
|
|||
| Depreciation and amortization |
|
243,226 |
|
|
228,893 |
|
|
483,084 |
|
|
463,833 |
|
|||
| Taxes other than income taxes |
|
61,684 |
|
|
57,651 |
|
|
123,656 |
|
|
117,005 |
|
|||
| Other expense |
|
3,282 |
|
|
1,042 |
|
|
6,446 |
|
|
1,626 |
|
|||
| Total |
|
1,150,077 |
|
|
1,051,199 |
|
|
2,168,500 |
|
|
2,026,257 |
|
|||
| Operating Income |
|
305,672 |
|
|
307,552 |
|
|
436,846 |
|
|
364,774 |
|
|||
| Other Income (Deductions) | |||||||||||||||
| Allowance for equity funds used during construction |
|
17,052 |
|
|
14,767 |
|
|
31,834 |
|
|
28,016 |
|
|||
| Pension and other postretirement non-service credits - net |
|
5,018 |
|
|
3,692 |
|
|
9,000 |
|
|
6,650 |
|
|||
| Other income |
|
13,096 |
|
|
12,104 |
|
|
18,077 |
|
|
29,565 |
|
|||
| Other expense |
|
(6,570 |
) |
|
(4,259 |
) |
|
(9,310 |
) |
|
(6,829 |
) |
|||
| Total |
|
28,596 |
|
|
26,304 |
|
|
49,601 |
|
|
57,402 |
|
|||
| Interest Expense | |||||||||||||||
| Interest charges |
|
133,601 |
|
|
113,527 |
|
|
259,360 |
|
|
218,470 |
|
|||
| Allowance for borrowed funds used during construction |
|
(11,402 |
) |
|
(11,559 |
) |
|
(21,265 |
) |
|
(21,661 |
) |
|||
| Total |
|
122,199 |
|
|
101,968 |
|
|
238,095 |
|
|
196,809 |
|
|||
| Income Before Income Taxes |
|
212,069 |
|
|
231,888 |
|
|
248,352 |
|
|
225,367 |
|
|||
| Income Taxes |
|
31,302 |
|
|
35,018 |
|
|
32,471 |
|
|
28,835 |
|
|||
| Net Income |
|
180,767 |
|
|
196,870 |
|
|
215,881 |
|
|
196,532 |
|
|||
| Less: Net income attributable to noncontrolling interests |
|
2,193 |
|
|
4,306 |
|
|
4,387 |
|
|
8,612 |
|
|||
| Net Income Attributable To Common Shareholders | $ |
178,574 |
|
$ |
192,564 |
|
$ |
211,494 |
|
$ |
187,920 |
|
|||
| Weighted-Average Common Shares Outstanding - Basic |
|
121,306 |
|
|
119,517 |
|
|
121,333 |
|
|
119,555 |
|
|||
| Weighted-Average Common Shares Outstanding - Diluted |
|
124,494 |
|
|
121,865 |
|
|
124,136 |
|
|
121,813 |
|
|||
| Earnings Per Weighted-Average Common Share Outstanding | |||||||||||||||
| Net income attributable to common shareholders - basic | $ |
1.47 |
|
$ |
1.61 |
|
$ |
1.74 |
|
$ |
1.57 |
|
|||
| Net income attributable to common shareholders - diluted | $ |
1.43 |
|
$ |
1.58 |
|
$ |
1.70 |
|
$ |
1.54 |
|
|||
View source version on businesswire.com: https://www.businesswire.com/news/home/20260804319083/en/
Media Contact: Alan Bunnell (602) 250-3376
Analyst Contact: Amanda Ho (602) 250-3334
Website: pinnaclewest.com
Source: Pinnacle West Capital Corp.