NiSource (NYSE:NI) reaffirmed its 2026 earnings outlook and raised its long-term growth expectations after reporting first-quarter adjusted earnings that management said reflected regulatory execution, infrastructure investment recovery and growing momentum in its data center strategy.
The regulated utility company reported first-quarter 2026 consolidated adjusted earnings per share of $1.06, up from $0.98 in the same period last year. Shawn Anderson, executive vice president and chief financial officer, said the 8% year-over-year increase was primarily driven by “regulatory execution across our base business” and recovery of capital investments from 2025 capital and regulatory plans.
NiSource reaffirmed its 2026 consolidated adjusted EPS guidance range of $2.02 to $2.07 per share. Anderson said the company had achieved 52% of the midpoint of that range in the first quarter and remains “well-positioned to achieve our full-year financial objectives.”
Data Center Agreements Drive Higher Long-Term Growth Outlook
President and Chief Executive Officer Lloyd Yates said NiSource is increasing its consolidated adjusted EPS compound annual growth rate outlook by 100 basis points for 2023 through 2033, to a range of 9% to 10%, with performance expected to track toward the high end of that range through 2030. Management attributed the increase to investment opportunities tied to data centers.
The company said it has expanded its data center-related strategy through its NIPSCO GenCo model, including a new energy infrastructure agreement with Alphabet and expanded service for Amazon. Yates said the company is adding an incremental 400 megawatts of capacity for Amazon. Michael Luhrs, executive vice president of technology, customer and chief commercial officer, said NiSource recently advanced several initiatives that now support approximately $1.4 billion in expected customer savings over 15 years.
Luhrs said the Alphabet agreement will use 340 megawatts of pooled resources, including advanced battery solutions and available market resources. Service is expected to begin this summer, with a full ramp by 2030 under a 15-year contract. For Amazon, Luhrs said more than 400 megawatts of contracted generation will support enhancements to the existing data center strategy and help retail customers realize savings sooner.
Management said the agreements are expected to increase total bill savings for existing residential customers to as much as $124 per customer per year. In response to analyst questions, Yates said the benefits are being well received by customers, regulators and other stakeholders, citing the projected $1.4 billion in customer savings, job creation and economic development in Indiana.
GenCo Pool Strategy and Pipeline
NiSource described its GenCo structure as a way to serve large-load customers while protecting existing retail customers from investment costs. Luhrs said the company is pursuing a pooled generation strategy that allows it to manage a diversified portfolio of resources accessed through GenCo. The initial pool is about 800 megawatts and is sized to meet load requirements plus applicable reserve margins.
Management said the structure is designed to ring-fence costs and risks associated with large loads, with costs recovered through bilateral contracts. Anderson said rate structures and contractual terms are intended to provide full cost recovery and appropriate risk-adjusted returns, while minimum demand charges, long-term commitments, credit support requirements and contractual risk allocations are designed to protect shareholders and existing customers.
NiSource said it has about 3 gigawatts of opportunities in strategic negotiations and line of sight to roughly 2 gigawatts of developing opportunities, even after securing approximately 800 megawatts of additional capacity for Alphabet and Amazon. In the question-and-answer session, Yates said the company has signed approximately 4 gigawatts of capacity for data centers to date and is engaged with multiple counterparties.
Asked whether the 9% to 10% long-term EPS growth outlook includes the broader pipeline, Yates said it includes only signed customer contracts and does not include opportunities still in strategic negotiations.
Capital Plan and GenCo Earnings Outlook
Anderson said NiSource’s five-year capital investment plan for its base business remains unchanged, with $21 billion of investments and $2 billion of upside opportunities. The consolidated plan is now enhanced by $7.6 billion in GenCo and data center-related capital.
The company also increased its GenCo EPS outlook. Anderson said NiSource now expects GenCo to contribute $0.25 to $0.35 per share in 2030 and $0.40 to $0.60 per share in 2033. He said those updates reflect “strong momentum” from new and enhanced data center agreements.
NiSource reaffirmed its expectation for funds from operations to debt of 14% to 16% in all years of the plan. The company expects to use a mix of cash from operations, new long-term debt and $400 million to $600 million of equity each year. Anderson said the updated financing plan reflects a $600 million increase in the capital expenditure plan, contracted capacity needs and a strengthening pipeline of opportunities.
Operations, Safety and Regulatory Updates
Yates said safety remains the company’s top priority and reported the safest first quarter for employee injuries since 2016. NiSource completed more than 11,000 miles of leak survey work during the quarter and identified and mitigated 113 large-volume leaks, which management said was ahead of plan. The company also exceeded targets for electric pole inspections and replacements.
Yates also highlighted operational efficiency initiatives, including efforts to reduce fleet idling, streamline IT applications and use artificial intelligence to improve permitting, invoicing and locate screening. He said AI contract tools have increased productivity by more than 20%.
On regulation, Yates said NiSource continues to work with stakeholders across its jurisdictions and supports measures such as Indiana House Bill 1002 and Ohio Senate Bill 103. He also addressed a second federal order requiring continued operation of NIPSCO’s Schahfer Coal Plant, saying the company’s plan has flexibility to comply while maintaining affordability, financial stability and reliability.
During the Q&A, management said Schahfer is a NIPSCO regulated asset, not a GenCo asset, and is not part of the pooled resources strategy or subject to a GenCo power purchase agreement.
Yates closed the call by thanking analysts and investors for their continued interest in the company.
About NiSource (NYSE:NI)
NiSource, Inc (NYSE: NI) is a publicly traded energy holding company headquartered in Merrillville, Indiana, that primarily owns and operates regulated local gas and electric utilities in the United States. Through its operating subsidiaries, the company delivers natural gas and electricity to residential, commercial and industrial customers and provides the associated distribution and transmission services that keep local energy systems functioning.
The company's core activities include natural gas distribution, electric transmission and distribution, system operations, maintenance and emergency response.
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