NI · Q3 2025 Earnings

Bullish

NiSource

Reported October 29, 2025

30-second summary

NiSource reaffirmed the upper half of FY2025 non-GAAP EPS guidance ($1.85–$1.89), introduced FY2026 guidance of $2.02–$2.07, and — the actual news — disclosed an executed $6–7B data center contract, a $28.0B five-year capex plan ($21B refreshed base + ~$7B GenCo, +45% vs. the prior $19.4B base-only plan), and a new 8–9% consolidated EPS CAGR through 2033. The 8–10% base rate base growth metric was extended to 2026–2030, and a new 9–11% consolidated rate base growth metric was introduced to capture GenCo. The result is a dual-track growth algorithm: 6–8% base utility EPS + GenCo-driven acceleration to an 8–9% consolidated EPS CAGR. This is a strategic reframe, not a quarter.

Headline numbers

EPS

Q3 FY2025

$0.19

Key financials

Q3 FY2025

Metric	Q3 FY2025	YoY	Q2 FY2025	QoQ
EPS	$0.19	—	$0.22	-13.6%

Guidance

NiSource reaffirms FY2025 EPS upper half while introducing FY2026 guidance of $2.02–$2.07 and announcing a substantially expanded $28.0B capex plan (2025–2030) that includes ~$7.0B for data center infrastructure and increases consolidated CAGR expectations to 8–9% through 2033.

Guidance is issued for the full year only, refreshed each quarter. Prior and new below are the same FY updated this quarter.

New guidance

Metric	Period	Guide	YoY
Non-GAAP Adjusted EPS	FY2026	$2.02–$2.07	—
Base Plan Annual EPS Growth	FY2026–FY2030	6%–8% annually	—
Consolidated Adjusted EPS CAGR	FY2026–FY2033	8%–9% CAGR	—
Total Capital Expenditure Plan	FY2025–FY2030	$28.0 billion consolidated	—
Data Center Capital Investment	FY2025–FY2030	~$7.0 billion	—

Changes to prior guidance

Metric	Period	Prior guide	New guide	Δ	Result
Total Capital Expenditure Plan	FY2025–FY2029	$19.4 billion	Withdrawn — no replacement	—	Withdrawn
Rate Base Growth	FY2025–FY2029	8%–10%	Withdrawn — no replacement	—	Withdrawn

Reaffirmed unchanged this quarter: Non-GAAP Adjusted EPS ($1.85–$1.89)

Other KPIs

Q3 FY2025

Segment	Q3 FY2025
Natural Gas Customers	3.3 million
Electric Customers	500,000
2025 Non-GAAP Adjusted EPS Guidance	$1.85-$1.89
2026 Non-GAAP Adjusted EPS Guidance	$2.02-$2.07
Base Plan Annual EPS Growth 2026-2030	6%-8%
Consolidated EPS CAGR 2026-2033	8%-9%
Total Capital Expenditure Plan (5-Year)	$28.0 billion
Data Center Capital Investment	$7.0 billion

Management tone

Q2 FY2025 (press release only): narrowing FY band → Q3 FY2025: full strategic reframe with multi-decade CAGR and named contract.

The shift from Q2 to Q3 is structural. Last quarter NiSource was a regulated utility narrowing a guidance band within an $19.4B/8–10% rate base/6–8% EPS framework — the standard utility equity story. This quarter, management retained that base-utility framework (extended to 2030) but layered on an entirely new operating model and a 2033-horizon consolidated CAGR. The signature line: "This business model serves as a scalable platform for growth... This transparent approach drives predictability and aligns our financial plan with long-term stakeholder value." Utilities do not typically issue eight-year CAGR guidance; doing so signals management believes the GenCo platform is repeatable rather than a one-off contract win.

The data center opportunity moved from absent in Q2's press release to executed-and-funded in Q3. Management's own framing: "Last month, we executed a data center contract with a large investment-grade customer... representing approximately $6 to $7 billion in capital investment... This project is accretive to NiSource's earnings per share forecast in all years of the plan." The Q2 watch list explicitly flagged Indiana data center load as a swing factor; one quarter later, it is the entire story.

Customer affordability was reframed from constraint to enabler. The traditional utility-growth tension — large new loads raising rates on existing customers — has been answered with an explicit pass-back: "This arrangement will allow for approximately $1 billion to be passed back to our existing NIPSCO electric customers, creating bill savings over the contract life... growth enhances value for our existing customers, going well beyond cost neutrality." This is the mechanism that makes the IURC approval (expected H1 2026) underwritable.

Pipeline language hardened from prospective to concrete: 2.4 GW of load secured (3 GW of generation backing it) + 1–3 GW in negotiation + ~3 GW in development. This is the disclosure that justifies an 8–9% consolidated CAGR rather than a single-contract bump.

What's notably absent from management's confident framing: any per-gigawatt EPS rule of thumb. Sean Anderson explicitly declined Evercore's attempt to back into ~$0.08/GW, citing technology and timing variability — the dual-platform model resists the simple sensitivity tables analysts wanted.

Recurring themes management leaned on this quarter:

GenCo as differentiated dual-growth platform unlocking speed and scaleCustomer affordability protected and enhanced through special contract structures and cost pass-through mechanismsData center infrastructure as secular tailwind aligning with on-shoring and AI capex cyclesRisk mitigation through fixed-rate contracts, termination protections, and cost-sharing arrangementsSubstantial capital deployment ($28B over 5 years) as largest investment cycle in company historyEconomic development benefits (job creation, tax revenue) as stakeholder value justification

Risks management surfaced:

Executive orders and regulatory developments related to coal plant retirements and energy transitionConstruction execution risk on two 1,300 MW CCGT plants (mitigated via EPC contract with Quanta/Zachry JV)Early exit risk on 15-year data center contract (mitigated via termination payment mechanisms)Dispatch, fuel, and merchant power risks (mitigated via fixed-rate contract structure)IURC approval timing and conditions on special contract agreement (expected H1 2026)

Q&A highlights

Julien de Moulin-Smith · Jefferies

Clarification on the 25-45 cents guidance range, what CapEx is reflected, and how the 1-3 gigawatts of upside would impact the earnings profile and sensitivity analysis.

Management explained the $6-7 billion CapEx supports the announced September customer and strategic positioning. The 25-45 cents reflects the September customer with upside from additional negotiations but no incremental disclosure per gigawatt. Customer technology choice and construction timelines drive variability. Potential exists to accelerate timelines and pull forward earnings ahead of 2033.

$6-7 billion CapEx over 5 years supports Genco development25-45 cents CAGR reflective of announced customer; higher end includes additional strategic negotiationsNo incremental EPS guidance provided per gigawatt due to technology and timing variabilityPotential upside from accelerating customer demand and construction timelines

Bill Apicelli · UBS

Return profile, capital structure assumptions for Genco, and timing differential between capital deployment (mostly through 2030) versus full earnings realization (2033).

Management stated Genco targets returns greater than NIPSCO's regulated rate; cannot disclose exact ROE due to customer confidentiality. Sought flexibility in capital structure from IURC. Capital deployment peaks 2025-2030, but construction completion and customer ramp extend through 2032. Fixed-rate contract structure provides stability and links capital recovery to construction completion. Potential upside if customer ramps accelerate.

Genco returns expected to exceed NIPSCO's regulated rate of return14-16% FFO to debt target maintained across planMajority of CapEx occurs 2025-2030; customer ramp finalizes 2032Fixed-rate contract structure ties recovery to construction completion

Nicholas Campanella · Barclays

Breakdown of 25-45 cent contribution range, confirmation that 1-3 gigawatts strategic negotiations are incremental, $1.5 billion Blackstone commitment terms, and NYSource equity contribution to funding $28 billion CapEx.

Management clarified 25-45 cents contemplates multiple customers at top end; announced September customer fits within range; strategic negotiation upside could exceed range depending on technology and timeline. Strategic negotiations are separate upside. Provided $300-500 million annual equity guidance for full $28 billion CapEx. All financing assumptions (equity, debt, non-controlling interest) reflected in EPS guidance.

25-45 cent range includes announced customer; potential additional customers could push to high end1-3 gigawatts strategic negotiations represents separate upside pipelineNYSource equity contribution: $300-500 million annuallyAll financing including non-controlling interests (Blackstone $1.5B) reflected in EPS guidance

Steve Fleischman · Wolf Research

Understanding the earnings and cash flow profile of Genco given significant capital investment but modest incremental equity needs; how the contract is structured to balance capital deployment with lower-than-expected equity issuance.

Management confirmed the $7 billion guided CapEx is sufficient to deliver the full 25-45 cent range through 2033. The September customer requires the $7 billion within the five-year horizon plus 2031-2032 capital outside the plan window. Cash flow strengthens significantly once customer ramps (2027+) and accelerates around 2030, reducing equity needs. Strategic negotiation upside would require incremental capital beyond the $7 billion.

$7 billion CapEx sufficient for full 25-45 cent rangeMost capital for September customer captured in $7B; 2031-32 spend reflected but not separately detailedStrategic negotiations upside would require incremental capital and financingCash flow strengthens beginning 2027; accelerates 2030+

Sharp · Wells Fargo

Quality of announced data center customer (hyperscaler, counterparty, co-locator?), and management approach to broader pipeline of 1-3 gigawatts under negotiation and impact on CAGR.

Management confirmed customer is large, investment-grade data center customer served via NIPSCO transmission. 2.4 GW load; 3 GW generation build. September 24 JNCO declination unlocked a new business model. Management has established a blueprint for execution with regulatory model alignment, customer flowback, EPC partnership, and long lead-time equipment secured. Subsequent customers will follow same disciplined, methodical approach supporting balance sheet and accretion.

Large investment-grade data center customer2.4 GW load; 3 GW generation buildJNCO declination (Sept 24) unlocked new Genco business modelEPC partnership and long lead-time equipment secured

Answers to last quarter's watch list

Will Q3 push FY EPS toward the top of the $1.85–$1.89 band, or was the Q2 narrowing the full upside? — Management reaffirmed the upper half of the range; the stated low-end shifted modestly from $1.865 to $1.85 but the upper-half positioning is intact. Q3 non-GAAP EPS came in at $0.19 vs. $0.20 prior year (-$0.01); GAAP EPS was $0.20 vs. $0.19. The strength is in YTD non-GAAP EPS of $1.38 vs. $1.26 prior year, which keeps the FY trajectory consistent with upper-half delivery.

Continue monitoring

Regulatory progress on the $19.4B 2025–2029 capex plan, especially Indiana (NIPSCO) and Columbia gas jurisdictions — The $19.4B plan has been refreshed to a $21B base plan (2025–2030) and the consolidated total is $28.0B including ~$7B of GenCo. The critical regulatory item is now IURC approval of the GenCo special contract structure (including the $1B customer flowback), expected H1 2026. Status: Not resolved (the underlying question was overtaken by the strategic reframe).

Financing mix and equity issuance cadence vs. capex ramp — Per Q&A, NiSource ATM equity runs $300–500M annually against the full $28B plan; Blackstone's $1.5B GenCo non-controlling interest is separate and additive, and the fixed-rate contract structure (with capital recovery tied to construction completion) materially limits dilution relative to the headline capex increase. Cash flow strengthens from 2027 and accelerates from 2030.

Resolved positively

Indiana data center / large-load interconnection load growth — This was the entire story. Executed $6–7B contract with an investment-grade hyperscale customer (2.4 GW load, 3 GW generation), plus 1–3 GW in negotiation and ~3 GW in earlier development.

Resolved positively

Incremental capex above the $19.4B base — Materialized at +$8.6B headline (to $28.0B), of which ~$7B is GenCo/data center and ~$1.6B is the base-utility refresh. Period also extended a year, so apples-to-apples comparison is messier than the headline suggests, but direction is clearly up and growth-driven.

Resolved positively

What to watch into next quarter

IURC ruling on the GenCo special contract structure and the $1B customer flowback mechanism — expected H1 2026; this is the gating event for the entire $7B GenCo capex tranche and the 8–9% consolidated CAGR

Whether any of the 1–3 GW of strategic negotiations convert to executed contracts, and whether management quantifies incremental EPS contribution above the $0.25–$0.45 announced-customer range

Whether the new 9–11% consolidated rate base growth metric becomes the primary investor framing or remains paired with the 8–10% base-only figure

FY2026 EPS guidance progression — the $2.02–$2.07 midpoint implies ~8.1% YoY growth; watch whether early-year prints support the upper half or whether the band shifts

Equity issuance cadence vs. the $300–500M annual ATM run-rate disclosed in Q&A; any expansion would signal GenCo financing is leaning harder on the parent than the Blackstone structure implied

EPC construction milestones at the two 1,300 MW CCGT plants and long-lead equipment delivery — execution risk is the single largest near-term threat to the 2032 customer ramp timeline

Sources

NiSource Q3 2025 earnings press release (Form 8-K Ex. 99.1), filed October 29, 2025 — https://www.sec.gov/Archives/edgar/data/1111711/000111171125000054/ni-ex991_20250930.htm
NiSource Q3 2025 earnings call prepared remarks and Q&A
NiSource Q2 2025 earnings press release (Form 8-K Ex. 99.1), filed August 6, 2025 — https://www.sec.gov/Archives/edgar/data/1111711/000111171125000035/ni-ex991_20250630.htm

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