NOTE 16. INFORMATION BY BUSINESS SEGMENTS The business segment presentation reflects the information reviewed by the Company's Chief Operating Decision Maker (CODM, the Company's President and Chief Executive Officer). Such information is the basis for the analysis of segment performance and the allocation of resources. Performance is evaluated based on net income (loss) and variances of actual performance from the Company's budget and/or forecast when making decisions. The accounting policies of the segments are the same as those described in the summary of significant accounting policies. Avista Utilities' business is managed based on the total regulated utility operation; therefore, it is considered one segment. AEL&P is a separate reportable business segment since it has separate financial information and its operations and risks are sufficiently different from Avista Utilities and the other businesses at AERC that it cannot be aggregated with other operating segments. The Other category, which is not a reportable segment, includes other investments and operations of various subsidiaries, as well as certain other operations of Avista Capital. Decisions by the CODM are made in consultation with other members of management, as appropriate, and are subject to the general oversight and strategic direction of the Board of Directors. The following table presents information for each of the Company’s business segments (dollars in millions):
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Reportable Segments |
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Avista
Utilities |
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Alaska
Electric
Light and
Power
Company |
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Total Utility |
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Other Non-Reportable Segment Items |
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Eliminations (1) |
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Total |
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For the three months ended September 30, 2026: |
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Operating revenues |
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$ |
410 |
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$ |
11 |
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$ |
421 |
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$ |
— |
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$ |
— |
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$ |
421 |
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Resource costs |
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130 |
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2 |
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132 |
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— |
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— |
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132 |
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Other operating expenses |
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116 |
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5 |
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121 |
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— |
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— |
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121 |
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Depreciation and amortization |
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72 |
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3 |
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75 |
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— |
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— |
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75 |
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Interest income |
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4 |
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— |
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4 |
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1 |
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— |
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5 |
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Interest expense (2) |
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39 |
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1 |
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40 |
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1 |
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— |
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41 |
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Other segment expenses (3) |
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22 |
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— |
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22 |
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2 |
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— |
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24 |
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Income tax expense |
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2 |
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— |
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2 |
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5 |
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— |
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7 |
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Equity method earnings |
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— |
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— |
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— |
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23 |
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— |
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23 |
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Net income |
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33 |
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— |
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33 |
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16 |
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— |
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49 |
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Capital expenditures (4) |
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182 |
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3 |
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185 |
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— |
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— |
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|
185 |
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For the three months ended September 30, 2025: |
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Operating revenues |
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$ |
394 |
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$ |
9 |
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$ |
403 |
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$ |
— |
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$ |
— |
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$ |
403 |
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Resource costs |
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115 |
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— |
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115 |
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— |
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— |
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115 |
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Other operating expenses |
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120 |
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5 |
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125 |
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3 |
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— |
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128 |
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Depreciation and amortization |
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70 |
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3 |
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73 |
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— |
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— |
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73 |
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Interest income |
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4 |
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— |
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4 |
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1 |
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(1 |
) |
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4 |
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Interest expense (2) |
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38 |
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2 |
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40 |
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— |
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(1 |
) |
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39 |
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Other segment expenses (3) |
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22 |
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— |
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22 |
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— |
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— |
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22 |
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Income tax expense (benefit) |
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3 |
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(1 |
) |
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2 |
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— |
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— |
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2 |
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Equity method earnings |
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— |
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— |
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— |
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1 |
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— |
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1 |
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Net income (loss) |
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30 |
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— |
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30 |
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(1 |
) |
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— |
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29 |
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Capital expenditures (4) |
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127 |
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6 |
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133 |
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— |
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— |
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133 |
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For the nine months ended September 30, 2026: |
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Operating revenues |
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$ |
1,366 |
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$ |
38 |
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$ |
1,404 |
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$ |
— |
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$ |
— |
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$ |
1,404 |
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Resource costs |
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461 |
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4 |
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465 |
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— |
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— |
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465 |
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Other operating expenses |
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371 |
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14 |
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385 |
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1 |
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— |
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386 |
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Depreciation and amortization |
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201 |
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9 |
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|
210 |
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— |
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— |
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|
210 |
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Interest income |
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11 |
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— |
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11 |
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1 |
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(1 |
) |
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11 |
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Interest expense (2) |
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116 |
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4 |
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|
120 |
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2 |
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(1 |
) |
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|
121 |
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Other segment expenses (3) |
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70 |
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— |
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70 |
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7 |
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— |
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|
77 |
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Income tax expense |
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16 |
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2 |
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18 |
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8 |
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— |
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26 |
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Equity method earnings |
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— |
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— |
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— |
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46 |
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— |
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|
46 |
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Net income |
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142 |
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5 |
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|
147 |
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29 |
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— |
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|
176 |
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Capital expenditures (4) |
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|
496 |
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|
15 |
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|
511 |
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— |
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— |
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|
511 |
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For the nine months ended September 30, 2025: |
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Operating revenues |
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$ |
1,398 |
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$ |
33 |
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$ |
1,431 |
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$ |
— |
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$ |
— |
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$ |
1,431 |
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Resource costs |
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|
500 |
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|
1 |
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|
501 |
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— |
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|
— |
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|
501 |
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Other operating expenses |
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|
364 |
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|
13 |
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|
377 |
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4 |
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— |
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|
381 |
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Depreciation and amortization |
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|
207 |
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9 |
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|
216 |
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— |
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— |
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|
216 |
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Interest income |
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10 |
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— |
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|
10 |
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|
1 |
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(2 |
) |
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|
9 |
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Interest expense (2) |
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|
110 |
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|
5 |
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|
115 |
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|
2 |
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(2 |
) |
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|
115 |
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Other segment expenses (3) |
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|
79 |
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— |
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|
79 |
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|
1 |
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— |
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|
80 |
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Income tax expense (benefit) |
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|
17 |
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|
1 |
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|
18 |
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(3 |
) |
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|
— |
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|
15 |
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Equity method losses |
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|
— |
|
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|
— |
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|
— |
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(10 |
) |
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— |
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(10 |
) |
Net income (loss) |
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|
131 |
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|
4 |
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|
135 |
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(13 |
) |
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— |
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|
122 |
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Capital expenditures (4) |
|
|
363 |
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|
16 |
|
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|
379 |
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|
— |
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|
— |
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|
379 |
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Total Assets: |
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As of September 30, 2026: |
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$ |
8,210 |
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|
$ |
293 |
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$ |
8,503 |
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$ |
220 |
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$ |
(26 |
) |
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$ |
8,697 |
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As of December 31, 2025: |
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$ |
7,917 |
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|
$ |
289 |
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$ |
8,206 |
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|
$ |
177 |
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$ |
(24 |
) |
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$ |
8,359 |
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(1)Intersegment eliminations reported as interest expense represent intercompany interest. (2)Including interest expense to affiliated trusts. (3)Other segment items include taxes other than income tax, AFUDC equity, and other miscellaneous expenses. (4)The capital expenditures for the other businesses are included in other investing activities on the Condensed Consolidated Statements of Cash Flows. |