Core Viewpoint - The utility sector is experiencing a significant earnings growth, driven by new contracts with data center providers, which may lead to lower consumer bills rather than higher costs [2][4][6]. Group 1: Earnings Growth and Utility Contracts - The utility sector is witnessing the longest run in earnings growth in its history, with sales and volumetric growth on the rise [2][3]. - A notable contract in Northern Indiana will result in a billion-dollar refund to consumers over a decade, showcasing a shift in the narrative around utility costs [6][7]. - Companies like NiSource are expected to double their earnings in less than a decade, with projections indicating earnings could reach nearly four dollars by 2033 [8][9]. Group 2: Data Center Impact - Data center providers, such as Amazon and Microsoft, are entering into contracts that significantly increase their energy payments, which may not be reflected in consumer bills [5][9]. - The pricing for energy from data centers can be about ten times higher than what consumers pay, indicating a substantial revenue stream for utilities [9]. Group 3: Future Outlook and Strategic Positioning - Utilities in the Midwest, including Alliant and Evergy, are well-positioned to maintain customer bills while benefiting from long-term contracts that extend into the 2030s [10][11]. - The energy landscape is shifting towards a combination of natural gas and renewables, making energy competitive and sustainable [13].

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Financial Data and Key Metrics Changes - The company reported a third quarter adjusted EPS of $0.19, bringing the year-to-date total to $1.38, reaffirming the upper half of the 2025 adjusted EPS guidance of $1.85 to $1.89 [8][25] - The company introduced 2026 consolidated EPS guidance of $2.02 to $2.07, reflecting a growth trajectory [8][29] - The adjusted EPS growth rate for the base business is projected at 6% to 8% annually through 2030, with a consolidated adjusted EPS CAGR of 8% to 9% through 2033 [7][30] Business Line Data and Key Metrics Changes - The company has secured approval for the GenCo model in Indiana and full ownership of the Templeton Wind asset, enhancing its regulatory foundation [7][10] - The GenCo investments are projected to enhance the value proposition for customers and shareholders, with an investment inventory of approximately $7 billion [22][26] - The company is advancing its AI and digital strategy, achieving sustained field productivity uplifts of over 20% [9][10] Market Data and Key Metrics Changes - The company is actively pursuing large load customers, with a recent contract with a significant investment-grade data center customer [13][20] - The partnership with Columbia Gas of Virginia to deliver natural gas to Eli Lilly's new $5 billion facility is expected to create 650 permanent jobs and 1,800 construction jobs [11][12] - The company is focused on economic development initiatives that expand the customer base and promote efficient distribution of fixed costs [10][11] Company Strategy and Development Direction - The company aims to deliver safe, reliable energy while capitalizing on emerging data center opportunities, with a focus on customer affordability [5][14] - The GenCo strategy is designed to protect existing customers while serving new customers with speed and flexibility, reinforcing the company's competitive position [12][36] - The company is committed to minimizing the financial impact of safety and reliability investments on customers, with a focus on operational excellence [30][31] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the pipeline of opportunities, with negotiations for an additional 1 to 3 gigawatts of projects ongoing [37] - The company is focused on maintaining affordability and reliability, with a positive relationship with the Indiana governor's office regarding economic development opportunities [67] - Management highlighted the importance of thoughtful risk management provisions in contracts to protect financial integrity [24][74] Other Important Information - The company has refreshed its five-year capital expenditure plan, increasing the base capital plan to $21 billion, with an additional $7 billion for data center investments [26][27] - The company is committed to a 14% to 16% FFO to debt ratio in all years of its plan, with a downgrade threshold of 13% [44][31] - The partnership with Blackstone Infrastructure Partners will contribute $1.5 billion in equity to support current initiatives and future growth opportunities [31][32] Q&A Session Summary Question: Can you speak to the quality of the customer behind the agreement? - The customer is a very large investment-grade data center customer, and the company has a clear path towards executing additional contracts based on this model [41][42] Question: What are the downgrade thresholds as you become more integrated? - The company believes that the risk management provisions in the contract provide adequate protection, and no change in downgrade thresholds is expected [44] Question: Can you elaborate on the $0.25 versus the $0.45 range? - The $0.25 to $0.45 range reflects contributions from multiple customers, with the potential for additional customers to push towards the higher end of that range [50][51] Question: What is the contribution from NiSource for GenCo? - The guidance reflects the total cost of financing, including equity, debt, and non-controlling interest associated with minority interest investors [52] Question: Can you discuss the return profile or capital structure assumptions within GenCo? - The targeted return for GenCo is expected to be greater than NIPSCO's regulated rate of return, with a flexible capital structure to support customer needs [79][80] Question: What is the timing differential of capital investment versus earnings realization? - Most capital expenditures occur between 2025 and 2030, with earnings realization linked to the completion of construction cycles [81][82]

Financial Data and Key Metrics Changes - The company reported a third quarter adjusted EPS of $0.19, bringing the year-to-date total to $1.38, reaffirming the upper half of the 2025 adjusted EPS guidance of $1.85-$1.89 [8][25] - The company introduced 2026 consolidated EPS guidance of $2.02-$2.07, reflecting a projected growth from the 2025 midpoint [28][34] - The adjusted EPS trajectory is expected to grow at a CAGR of 8.2% from $1.37 in 2021 to a projected $1.88 in 2025 [32][33] Business Line Data and Key Metrics Changes - The company secured approval of the Genco model in Indiana and full ownership of the Templeton Wind asset, reinforcing its regulatory foundation [7][10] - The Genco investments are projected to enhance the value proposition for customers and shareholders, with an investment inventory of approximately $7 billion [22][23] Market Data and Key Metrics Changes - The company is advancing its tracker programs in Ohio and Indiana, with a Pennsylvania rate case expected to conclude by year-end [10][11] - Columbia Gas of Virginia's partnership with Eli Lilly for a $5 billion manufacturing facility is expected to create 650 permanent jobs and 1,800 construction jobs, showcasing economic development [11][12] Company Strategy and Development Direction - The company aims for a 6%-8% annual adjusted EPS growth rate through 2030 and an 8%-9% adjusted EPS CAGR through 2033, aligning financial plans with long-term stakeholder value [7][30] - The Genco strategy is designed to protect existing customers while serving new large load customers with speed and flexibility, enhancing the competitive position [12][21] Management's Comments on Operating Environment and Future Outlook - Management emphasized the importance of customer affordability and the proactive approach to economic development, ensuring reliability and sustainability [11][12] - The company is confident in its ability to execute large-scale construction projects and is focused on operational excellence to meet growing customer needs [10][36] Other Important Information - The company has refreshed its five-year capital expenditure plan to $28 billion, which includes $7 billion for data center investments, marking one of the largest investment cycles in its history [26][27] - The partnership with Blackstone Infrastructure Partners will contribute $1.5 billion in equity, reinforcing the capital structure for Genco [31][32] Q&A Session Summary Question: Can you speak to the quality of the customer behind the agreement? - The customer is a large investment-grade data center customer, and the company has a clear path for executing future negotiations based on this model [39][41] Question: What are the downgrade thresholds as you become more integrated? - The company believes that the risk management provisions in the contract provide adequate protection, and no change in downgrade thresholds is expected [43][44] Question: Can you elaborate on the $0.25 versus the $0.45 range? - The $0.25-$0.45 range reflects contributions from the current customer, with potential upside from additional strategic negotiations [49][50] Question: What is the contribution from NiSource for Genco? - The guidance reflects the total cost of financing, including equity and debt, supporting the full $28 billion of capital expenditures [52][53] Question: Can you discuss the return profile or capital structure assumptions within Genco? - The targeted return for Genco is expected to be greater than NIPSCO's regulated rate of return, with a flexible capital structure to support development [77][79] Question: What is the timing differential of capital investment versus earnings realization? - Most capital expenditures will occur between 2025 and 2030, with earnings realization linked to the completion of construction cycles [81][82]

Financial Data and Key Metrics Changes - The company reported a third quarter adjusted EPS of $0.19, bringing the year-to-date total to $1.38, reaffirming the upper half of the 2025 adjusted EPS guidance of $1.85 to $1.89 [6][22] - The 2026 consolidated EPS guidance is announced to be $2.02 to $2.07, reflecting strong financial commitments and growth potential [6][26] - The adjusted EPS trajectory shows an increase from $1.37 in 2021 to a projected $1.88 in 2025, representing an 8.2% CAGR over five years [29] Business Line Data and Key Metrics Changes - The company has secured approval for the GenCo model in Indiana and full ownership of the Templeton Wind asset, reinforcing its regulatory foundation [5][8] - The GenCo investments are projected to enhance the value proposition for customers and shareholders, with an investment inventory of approximately $7 billion [19][22] Market Data and Key Metrics Changes - The company is advancing its regulatory agenda in Ohio and Indiana, with a Pennsylvania rate case expected to conclude by year-end [8][9] - Columbia Gas of Virginia's partnership with Eli Lilly for a $5 billion manufacturing facility is highlighted as a proactive economic development initiative [9] Company Strategy and Development Direction - The company aims for a 6% to 8% annual adjusted EPS growth rate through 2030 and an 8% to 9% CAGR for consolidated business through 2033 [5][27] - Investments in AI-driven operational efficiencies are emphasized to enhance customer affordability and service quality [7][10] - The GenCo strategy is designed to protect existing customers while serving new large load customers with speed and flexibility [10][18] Management's Comments on Operating Environment and Future Outlook - Management expresses confidence in the pipeline of projects and the ability to execute on new customer agreements, highlighting a robust growth strategy [33] - The focus remains on customer affordability and operational excellence, with a commitment to minimizing the financial impact of investments on customers [11][28] Other Important Information - The company has introduced a refreshed five-year capital expenditure plan of $28 billion, which includes $7 billion for data center investments [23][24] - The partnership with Blackstone Infrastructure Partners is expected to contribute $1.5 billion in equity, reinforcing the capital structure [29] Q&A Session Summary Question: Can you speak to the quality of the customer behind the agreement? - The customer is described as a very large investment-grade data center customer, with a new business model being unlocked for future negotiations [35][36] Question: What is the return profile or capital structure assumptions within the GenCo? - The targeted return for GenCo is expected to exceed NIPSCO's regulated rate of return, with a flexible capital structure to support customer needs [64][65] Question: Can you elaborate on the $0.25 versus the $0.45 range? - The range reflects contributions from multiple customers, with the current customer fitting within that range, and additional customers could push towards the higher end [43][44] Question: What protections are in place for the contracts? - The contracts include thoughtful risk management provisions, cost-sharing arrangements, and a fixed-rate structure to mitigate risks [60][61] Question: How does the timing of capital investment align with earnings realization? - Most capital expenditures occur between 2025 and 2030, with earnings ramping up as customers begin to utilize the infrastructure [66][67]

Core Insights - NiSource Inc. reported third-quarter 2025 operating earnings per share (EPS) of 19 cents, missing the Zacks Consensus Estimate of 20 cents by 5% and down by a penny from the previous year [1] - The company’s total revenues reached $1.28 billion, exceeding the Zacks Consensus Estimate of $1.17 billion by 8.6% and increasing 18.3% year-over-year [2][9] Financial Performance - Total operating expenses were $0.98 billion, up 13.7% from $0.86 billion in the prior-year quarter [3] - Operating income increased to $297.5 million, a rise of 36.3% from $218.3 million in the previous year [3] - Net interest expenses rose to $179.8 million, up 33.6% from $134.6 million in the prior-year quarter [3] Sales and Distribution - Total gas distribution in Sales and Transportation (excluding weather) was 100.2 Million British Thermal Units per day (MMDth), up 3.5% from 96.8 MMDth in the prior-year quarter [4] - Total electric sales (excluding weather) were recorded at 4,621.6 gigawatt-hours (GWh), an increase of 0.8% from 4,587.1 GWh in the prior-year quarter [4] Financial Position - Cash and cash equivalents as of September 30, 2025, were $95 million, down from $156.6 million as of December 31, 2024 [5] - Long-term debts as of September 30, 2025, were $14.47 billion, compared to $12.07 billion as of December 31, 2024 [5] - Net cash flows from operating activities in the first nine months of 2025 were $1.65 billion, up from $1.24 billion in the same period of 2024 [5] Liquidity and Guidance - NiSource's liquidity as of September 30, 2025, was nearly $3 billion, sufficient to meet near-term obligations [6] - The company reaffirmed 2025 non-GAAP earnings guidance of $1.85-$1.89 per share and expects 2026 non-GAAP earnings in the range of $2.02-$2.07 [7] - NiSource anticipates an earnings CAGR of 6-8% through 2030 [7] Capital Expenditure - The company plans a capital expenditure of $28 billion for the 2026-2030 period, which is nearly $8.6 billion higher than the previous five-year plan, primarily driven by $7 billion in strategic investments for data centers [8][9]

Financial Performance & Guidance - The company reaffirmed the upper half of its 2025 adjusted EPS guidance at $1.85-$1.89 and initiated 2026 consolidated adjusted EPS guidance of $2.02-$2.07 [16] - The company is targeting an annual base plan adjusted EPS growth of 6%-8% from 2026-2030 and a consolidated adjusted EPS CAGR of 8%-9% from 2026-2033 [12] - The company anticipates Funds From Operations (FFO) to Debt to be 14%-16% annually through 2030 [12] Capital Investment & Rate Base - The company increased its enterprise capital plan to $28.0 billion for 2026-2030, representing an approximate 45% increase from the prior 5-year plan [16] - The company plans for base plan capital investments of $21.0 billion from 2026-2030 and approximately $7.0 billion in data center capital investment, supporting a 9%-11% consolidated Rate Base CAGR from 2026-2033 [16] - The company's year-end 2024 regulated electric and gas rate base was $21.3 billion [12] Data Center Strategy & GenCo - The company established a commercial partnership with a large investment-grade data center customer to power 3 GW of generation capacity in Northern Indiana [23] - The company's GenCo capital investment is projected to be approximately $7.0 billion [12] - The company is in strategic negotiations for an additional 1-3 GW of load [12] Third Quarter 2025 Results - The company's GAAP net income available to common shareholders for the third quarter of 2025 was $94.7 million, compared to $85.7 million in the third quarter of 2024 [40] - The company's adjusted net income available to common shareholders for the third quarter of 2025 was $91.8 million, compared to $89.9 million in the third quarter of 2024 [40]

Core Insights - NiSource reported quarterly earnings of $0.19 per share, missing the Zacks Consensus Estimate of $0.20 per share, representing a -5.00% earnings surprise [1] - The company posted revenues of $1.27 billion for the quarter ended September 2025, exceeding the Zacks Consensus Estimate by 8.33% and up from $1.08 billion a year ago [2] - NiSource shares have increased approximately 18% year-to-date, outperforming the S&P 500's gain of 17.2% [3] Earnings Performance - Over the last four quarters, NiSource has surpassed consensus EPS estimates three times [2] - The current consensus EPS estimate for the upcoming quarter is $0.49 on revenues of $1.64 billion, and for the current fiscal year, it is $1.88 on revenues of $6.26 billion [7] Market Outlook - The company's earnings outlook and estimate revisions trend were favorable ahead of the earnings release, resulting in a Zacks Rank 2 (Buy) for the stock, indicating expected outperformance in the near future [6] - The Utility - Electric Power industry, to which NiSource belongs, is currently in the top 21% of Zacks industries, suggesting a positive industry outlook [8]

Financial Performance - For the three months ended September 30, 2025, NiSource reported total operating revenues of $1,273.1 million, a 18.3% increase from $1,076.3 million in the same period of 2024[19]. - Customer revenues for the nine months ended September 30, 2025, reached $4,636.2 million, up 23.9% from $3,743.2 million in 2024[19]. - Operating income for the three months ended September 30, 2025, was $297.5 million, representing a 36.3% increase compared to $218.3 million in 2024[19]. - Net income attributable to NiSource for the nine months ended September 30, 2025, was $671.7 million, a 25.9% increase from $536.5 million in 2024[19]. - Basic earnings per share for the three months ended September 30, 2025, were $0.20, compared to $0.19 in the same period of 2024[19]. - Comprehensive income for the three months ended September 30, 2025, was $122.2 million, compared to $101.0 million in 2024[20]. - Net income for the nine months ended September 30, 2025, increased to $734.2 million, up from $600.4 million in 2024, representing a growth of approximately 22.3%[24]. - The total operating revenue for the three months ended September 30, 2025, was $1,275.5 million, an increase from $1,079.6 million in the same period of 2024, representing an 18.1% growth[128][130]. - Operating income for the three months ended September 30, 2025, was $284.7 million, compared to $212.5 million for the same period in 2024, reflecting a 34% increase[128][130]. - For the nine months ended September 30, 2025, total operating revenue reached $4,746.5 million, up from $3,877.1 million in 2024, marking a 22.4% increase[133]. Assets and Equity - Total assets as of September 30, 2025, amounted to $34,402.9 million, an increase from $31,788.1 million at the end of 2024[22]. - Total stockholders' equity increased to $11,241.8 million as of September 30, 2025, compared to $10,668.3 million at the end of 2024[23]. - The balance of additional paid-in capital increased to $9,798.3 million as of September 30, 2025, from $9,521.5 million at the end of 2024, reflecting a growth of about 2.9%[26]. - The company’s retained deficit improved to $(572.0) million as of September 30, 2025, compared to $(711.7) million at the end of 2024, indicating a reduction of approximately 19.6%[26]. - The balance of common stock increased from 451,345 thousand shares as of December 31, 2023, to 470,670 thousand shares as of September 30, 2024[28]. - The fair value of long-term debt as of September 30, 2025, was estimated at $14,050.3 million, compared to a carrying amount of $14,503.4 million[94]. Cash Flow and Capital Expenditures - Net cash flows from operating activities reached $1,649.7 million, compared to $1,241.7 million in the same period of 2024, indicating a year-over-year increase of about 32.8%[24]. - Capital expenditures for the nine months ended September 30, 2025, totaled $1,936.0 million, an increase from $1,854.0 million in 2024, reflecting a growth of approximately 4.4%[24]. - The company paid dividends of $396.4 million on common stock during the nine months ended September 30, 2025, compared to $357.0 million in 2024, representing an increase of approximately 11.0%[24]. - The company reported a cash and cash equivalents balance of $95.0 million as of September 30, 2025, down from $156.6 million at the end of 2024[215]. Debt and Financing - Long-term debt, excluding amounts due within one year, rose to $14,472.1 million as of September 30, 2025, up from $12,074.5 million at the end of 2024[23]. - Proceeds from the issuance of long-term debt amounted to $2,362.0 million, compared to $2,229.6 million in 2024, showing an increase of about 5.9%[24]. - The company had $1,060.0 million of commercial paper outstanding as of September 30, 2025, with a weighted-average interest rate of 4.40%[64]. - The revolving credit facility has a program limit of $1.85 billion, with no outstanding borrowings as of September 30, 2025[63]. - NiSource's credit ratings remain stable, with S&P rating at BBB+, Moody's at Baa2, and Fitch at BBB as of September 30, 2025[216]. Operational Highlights - The Columbia Operations segment reported residential gas distribution revenues of $328.1 million for the three months ended September 30, 2025, compared to $296.9 million in the same period of 2024, marking an increase of approximately 10.5%[40]. - NIPSCO Operations generated electric service revenues of $633.1 million for the three months ended September 30, 2025, up from $515.1 million in the same period of 2024, representing a growth of about 22.9%[40]. - The company executed a forward sale agreement in February 2025, settling for $80.0 million based on a net price of $40.02 per share[57]. - NIPSCO plans to retire remaining coal-fired electric generation by 2028, transitioning to a balanced mix of low- or zero-emission electric generation[155]. - NIPSCO has placed into service renewable projects totaling 3,051 MW of nameplate capacity since 2020, with additional projects expected to be operational between 2025 and 2027[194]. Regulatory and Compliance - The company is evaluating the impacts of recent accounting pronouncements on its financial disclosures and policies[33]. - The Indiana Utility Regulatory Commission approved a Joint Stipulation and Settlement Agreement on June 26, 2025, which implemented new rates in multiple steps starting July 2025[76]. - NIPSCO Gas filed for a CPCN on April 21, 2025, seeking recovery of $244.1 million related to federally mandated Pipeline Safety IV Compliance Plan costs, which was granted on October 22, 2025[211]. - The company recorded a liability of $84.6 million for environmental remediation as of September 30, 2025, compared to $91.8 million as of December 31, 2024[112]. Employee and Talent Management - Increased competition for talent has led to higher costs for attracting and retaining employees, prompting NIPSCO to enhance its internal human capital programs[162].