NI — NiSource Inc.

Summary of NiSource Inc. Q1 2026 Earnings Call

1. Key Financial Results and Metrics

• Consolidated Adjusted EPS: Reported at $1.06, an 8% increase from $0.98 in Q1 2025, achieving 52% of the projected midpoint earnings guidance for the year.
• 2026 EPS Guidance: Reaffirmed at $2.02 to $2.07 per share, with a long-term adjusted EPS CAGR increase to 9% to 10% through 2033.
• Capital Investment: Five-year capital investment plan remains at $21 billion, with an additional $7.6 billion allocated for Genco and data center-related capital.

2. Strategic Updates and Business Highlights

• Partnerships: Expanded agreements with Amazon and Alphabet, expected to deliver $1.4 billion in customer savings over 15 years, translating to approximately $124 annual savings per residential customer.
• Genco Model: Designed for flexibility and speed, supporting the growing energy demand from data centers while shielding retail customers from costs.
• Operational Excellence: Achieved the safest first quarter on record for employee injuries and completed over 11,000 miles of leak surveys, identifying 113 large-volume leaks.
• Regulatory Engagement: Actively working with stakeholders to enhance regulatory frameworks and support legislative measures that benefit customer affordability.

3. Forward Guidance and Outlook

• Earnings Growth: Projecting continued strong performance with a focus on disciplined capital deployment and operational improvements.
• Customer Demand: Anticipating modest customer demand growth of less than 1% across all classes.
• Pipeline Opportunities: Identified approximately 3 gigawatts in strategic negotiations, with a strong pipeline of developing opportunities.

4. Bad News, Challenges, or Points of Concern

• Regulatory Risks: Ongoing engagement with regulators in Pennsylvania following a recent governor's letter, which could impact future rate case strategies and investment plans.
• Market Volatility: The reliance on market conditions for capacity purchases introduces potential risks, although the company has strategies to mitigate these.
• Execution Risks: Complex negotiations for new customer contracts could delay expected benefits and savings.

5. Notable Q&A Insights

• Customer Engagement: The management expressed confidence in the positive reception of their initiatives by customers and regulators, highlighting the $1.4 billion in savings as a significant benefit.
• Capacity and Earnings: Discussions indicated that earnings from new capacity would depend on specific customer needs and the associated resource mix, emphasizing a tailored approach to contract negotiations.
• Regulatory Approvals: Clarified that special contracts for Genco do not require separate regulatory approvals for pooled resources, streamlining the process for serving data center contracts.
• Future Financial Reporting: Management indicated that Genco would be reported separately once it significantly contributes to overall financial results.

Overall, NiSource Inc. demonstrated strong financial performance in Q1 2026, bolstered by strategic partnerships and a robust regulatory framework, while navigating potential challenges in regulatory engagement and market conditions.