NiSource Inc. (NI): BCG Matrix [Dec-2025 Updated]

You're looking at NiSource Inc. (NI) as of late 2025, and honestly, the picture is a classic utility tug-of-war: rock-solid regulated cash flow versus massive, high-stakes growth bets. We've mapped their portfolio using the BCG Matrix, showing how their existing gas business, supporting a 39-year dividend streak and $1.85-$1.89 adjusted EPS guidance for 2025, sits alongside the huge $21.0 billion capital plan aimed at modernization and the speculative ~$7.0 billion data center push. Let's cut through the noise and see exactly where NiSource needs to invest, hold, or divest its resources right now.

Background of NiSource Inc. (NI)

You're looking at NiSource Inc. (NI) as of late 2025, and the story here is one of significant, strategically funded expansion, moving beyond the traditional utility growth profile. NiSource Inc. is one of the nation's biggest natural gas distributors, serving about 3.2 million customers across six states: Indiana, Kentucky, Maryland, Ohio, Pennsylvania, and Virginia. Plus, they run the electric utility in northern Indiana, which covers roughly 500,000 customers and has over 3,000 megawatts of generation capacity, mixing coal, natural gas, and renewables.

Financially, the company is showing strong momentum heading into the end of 2025. For the twelve months ending September 30, 2025, NiSource's revenue hit $6.327B, marking a substantial 19.62% increase year-over-year. Management reaffirmed its full-year 2025 non-GAAP adjusted earnings per share (EPS) guidance to the upper half of the $1.85 to $1.89 range. For the nine months of 2025, GAAP net income was $671.7 million, or $1.42 per diluted share.

The real story driving future expectations is the massive capital investment. NiSource recently outlined a $28 billion five-year capital plan extending through 2030, which is a significant jump from the previous $19.4 billion projection. This increase is largely due to nearly $7.0 billion earmarked for strategic data center investments through their newly approved NIPSCO Genco structure in Indiana. This new structure is designed to bring in growth while protecting existing ratepayers from those specific large-load development costs.

The base business still forms a solid foundation, targeting 6%-8% annual adjusted EPS growth through 2030, supported by $21.0 billion in base capital expenditures and 8%-10% rate base growth in that period. Overall, management is projecting a consolidated non-GAAP adjusted EPS compound annual growth rate (CAGR) of 8%-9% through 2033, incorporating these new growth drivers. On the regulatory front, they saw success, like the $257 million revenue uplift from the NIPSCO electric rate case approval in June 2025.

Operationally, the company is focused on efficiency; for instance, their internal AI work management solution has saved the equivalent of more than 83,000 incremental work hours across their operating companies. To help fund this expansion, NiSource also announced a $1.5 billion at-the-market equity program. They definitely seem committed to executing this growth plan while maintaining their regulated utility stability.

NiSource Inc. (NI) - BCG Matrix: Stars

You're looking at the core growth engine for NiSource Inc. (NI) right now, the area where high market share meets a rapidly expanding regulated environment. These are the investments that secure future earnings through approved capital recovery mechanisms. The focus here is on deploying capital to grow the asset base that regulators allow NiSource to earn a return on.

The regulated utility structure provides the high market share, and the capital plan drives the growth. If NiSource keeps executing, these investments mature into the reliable Cash Cows of tomorrow.

Regulated Rate Base Growth

The expected rate base expansion is the primary indicator of a Star business unit for NiSource. This growth is directly tied to the company's ability to recover its massive capital investments through regulatory processes across its service territories.

• Annual rate base growth targeted for the 2025-2029 period is 8%-10%.
• The projected annual rate base growth for the extended 2026-2030 period remains 8%-10%.

This predictable, high single-digit growth rate is what makes the regulated utility a Star, as it's growth in a market where NiSource already holds a monopoly position.

NIPSCO's Renewable Generation Transition

The electric generation transition, primarily through its Northern Indiana Public Service Company (NIPSCO) subsidiary, represents a high-growth area driven by clean energy mandates and customer demand, like the data center load capture. This transition requires significant upfront cash deployment.

The Fairbanks Solar project, for instance, is a specific asset expected to be in-service in 2025, contributing to this growth vector.

Gas System Hardening

This category is a massive, non-optional investment that secures the existing gas market share and ensures regulatory compliance and safety, which are key to maintaining operating authority and returns. It's the largest bucket of the current base capital plan.

Here's the quick math on the 2025-2029 spend:

• The 2025-2029 base capital expenditure plan totals $19.4 billion.
• Approximately 48% of this $19.4 billion plan is attributed to gas system hardening and safety upgrades.

So, that's roughly $9.31 billion (48% of $19.4 billion) dedicated to hardening the gas infrastructure over that five-year window. This sustained investment protects the core gas customer base.

Infrastructure Modernization

Infrastructure modernization is the umbrella for much of the regulated capital deployment, securing the asset base for the next regulatory cycle. The plan is extending to 2030, showing a long-term commitment to this Star status.

The core of the next five-year plan, which follows the 2025-2029 plan, is substantial:

• The base capital plan for 2026-2030 is set at $21.0 billion.
• This is part of a newly consolidated capital expenditure plan totaling $28.0 billion through 2030.

This $21.0 billion spend is designed to modernize both gas and electric infrastructure, directly supporting the long-term regulated earnings growth targets. Finance: draft 13-week cash view by Friday.

NiSource Inc. (NI) - BCG Matrix: Cash Cows

You're looking at the core, bedrock businesses of NiSource Inc. (NI) here, the segments that reliably fund the rest of the portfolio. These are the classic Cash Cows: high market share in mature, regulated utility markets. They don't need massive promotional spending; they just need steady maintenance capital to keep the lights and gas flowing.

The Existing Regulated Gas Distribution business is the powerhouse here. NiSource Inc. is one of the largest natural gas utility companies in the United States, serving more than 3.3 million customers. This service footprint spans six states-Indiana, Kentucky, Maryland, Ohio, Pennsylvania, and Virginia-through its Columbia Gas and NIPSCO brands. The regulated nature of this business means revenue streams are predictable, which translates directly into high-margin cash flow generation.

Also firmly in the Cash Cow quadrant are the Core Electric T&D Assets. This mature network provides electric energy to approximately 500,000 customers, all concentrated in northern Indiana. Like the gas side, this is a stable, regulated revenue generator. The company is investing in this area, with approximately $20 billion in 100% Regulated Utility Infrastructure Investment Opportunities spanning the next five years.

These mature operations underpin the Consolidated Financial Performance. For the full year 2025, NiSource Inc. is reaffirming its non-GAAP adjusted earnings per share (EPS) guidance in the upper half of the $1.85-$1.89 range. This provides a defintely reliable cash stream that supports corporate functions and shareholder returns. The base capital expenditure plan for 2025 is set at $19.4 billion.

The ultimate proof of the Cash Cow status is the Long-Term Dividend Payout commitment. The stable utility structure has supported dividend payments for 39 consecutive years. The current annual dividend is $1.12 per share, paid quarterly at $0.28 per share as of November 20, 2025. This payout represents a payout ratio of approximately 58.11% to 60% of earnings. Companies are advised to 'milk' these gains passively, and NiSource Inc. is certainly doing that for its shareholders.

Here's a quick look at the scale of these cash-generating units:

These Cash Cows are the foundation, but even they require strategic support to maintain efficiency and cash flow. The focus here isn't on explosive growth, but on operational excellence and disciplined capital deployment. You should expect investments to focus on infrastructure modernization rather than market expansion.

• Maintain service reliability and safety scores.
• Systematically replace aging utility infrastructure.
• Support the current dividend payout structure.
• Fund administrative costs and corporate debt service.

What this estimate hides is the capital required to keep these assets compliant and efficient, which is substantial, evidenced by the $19.4 billion base capital expenditure plan for 2025. Still, the regulated structure ensures a return on that investment, keeping the cash flowing.

Finance: draft the Q4 2025 cash flow projection based on the reaffirmed $1.85-$1.89 EPS guidance by next Tuesday.

NiSource Inc. (NI) - BCG Matrix: Dogs

Dogs are units or products with a low market share and low growth rates. They frequently break even, neither earning nor consuming much cash. Dogs are generally considered cash traps because businesses have money tied up in them, even though they bring back almost nothing in return. These business units are prime candidates for divestiture.

Legacy Coal-Fired Generation: Assets slated for retirement, with a goal to be 100% coal-free by 2026-2028. NiSource Inc. is executing an electric generation transition consistent with its 2024 Plan, which outlines the path to retire the remaining coal-fired generation. As of the end of 2023, NiSource had reduced Scope 1 greenhouse gas emissions by approximately 72% from 2005 levels.

Non-Core/Retired Assets: Older, high-maintenance infrastructure that is being phased out and offers no future rate base growth. The retirement schedule for NIPSCO's coal units is firming up, with the final units expected to be retired by the end of the target window. The company's overall capital expenditure plan for 2025-2029 totals approximately $19.4 billion, a significant commitment that prioritizes future growth areas over legacy assets.

Outdated Generation Capacity: Requires ongoing maintenance capital without contributing to the high-growth rate base, a clear drag on capital efficiency. These assets are being replaced by lower-cost, reliable, and cleaner options, which is a key component of the overall capital strategy. The growth expected from modern investments is targeted at 8%-10% rate base growth annually for the 2025-2029 period, which contrasts sharply with the zero growth from these retiring units.

The specific capacity slated for retirement, which falls into the Dog category due to its low growth and imminent exit, is detailed below:

The financial context shows that while these units are being phased out, capital is being heavily directed elsewhere. For example, the 2025-2029 capital plan includes an estimated $1.6 billion for renewable generation projects.

Key statistical and financial markers related to the transition away from these legacy assets include:

• 2024 total capital expenditures were $3.7 billion.
• 2025 non-GAAP adjusted EPS guidance is $1.85-$1.89.
• The goal is to be 100% coal-free by 2026-2028.
• The R.M. Schahfer coal units were originally slated for retirement by May 2023.
• The total capital expenditure plan for 2025-2029 is $19.4 billion.

NiSource Inc. (NI) - BCG Matrix: Question Marks

You're looking at the areas of NiSource Inc. (NI) that are burning cash now for a potentially massive payoff later. These are the high-growth plays where market share isn't locked down yet, so they demand serious capital to push them forward, or risk becoming Dogs.

Strategic Data Center Investments

This is the big one consuming capital right now. NiSource Inc. has announced a massive commitment to power the data center boom in Northern Indiana. This is a high-growth market, but the revenue stream from this specific build-out is tied to securing and executing these new, large-load contracts. The company is setting aside a significant portion of its total planned spending for this specific purpose.

The dedicated capital investment earmarked for data center growth is approximately $7.0 billion over the next five years, which is part of a consolidated capital expenditure plan totaling $28.0 billion over the next five years. This investment includes the construction of two 1,300-megawatt combined-cycle, natural gas-fired turbines and 400 megawatts of battery storage to meet the escalating power demands of these hyperscaler customers.

NIPSCO GenCo Development

The launch of NIPSCO Generation LLC (GenCo) is the mechanism to handle these data center customers, and it's definitely a high-risk, high-reward venture until those generation assets are fully operational and contracted under the new structure. GenCo was approved by the Indiana Utility Regulatory Commission (IURC) in September to separate the costs of serving new, large-load customers from existing retail ratepayers. The first GenCo agreement, with a large, investment-grade data center customer, signals the potential scale.

This initial GenCo contract could represent a grid investment of $6 billion to $7 billion. The utility plans to start constructing the required generation capacity in 2027, aiming to meet the project's full demand by 2032. If successful, this model is estimated to allow $1 billion in savings to flow back to existing customers, but the risk lies in the multi-year construction timeline before revenue is fully secured and predictable under the new entity.

Advanced AI/Operational Technology

NiSource Inc. is using advanced technology to drive efficiency, which is a positive sign for controlling operating costs in a capital-intensive business. However, these productivity gains haven't yet translated into a proven, dominant revenue-generating market share in the way a Star would. It's an internal investment that helps offset costs, but it's not a direct, high-market-share revenue driver yet.

The AI-driven Project Apollo initiative, which focuses on scheduling and work management across 17 operations centers, has already delivered substantial internal savings. Since 2023, the company has logged over 60,000 labor hours saved. Furthermore, CEO Lloyd Yates noted that AI-driven solutions improved field productivity by 24% in Q2 2025, which is equivalent to 83,000 incremental work hours. This productivity boost has helped keep Operating and Maintenance (O&M) costs flat at $1.4 billion annually since 2016, which is quite an achievement for a utility.

Low-Carbon Fuels R&D

This represents the company's bet on the future energy mix, involving early-stage exploration into cleaner technologies. These initiatives are cash-intensive now, with uncertain near-term returns, fitting the classic Question Mark profile of high growth potential but low current market share in the overall energy portfolio.

NiSource Inc. has an overall goal of achieving net-zero greenhouse gas (GHG) emissions from operations by 2040, having already reduced these emissions by approximately 72% from 2005 levels as of the end of 2024. The company is involved in the Low-Carbon Resources Initiative (LCRI), which focuses on technologies like clean hydrogen and renewable natural gas. Prior spending included an investment of approximately $4 billion in renewable and natural gas generation from 2020 to 2027, with plans to install $2.2 billion in renewable generation facilities by 2025.

Here's a quick look at the hard numbers associated with these growth bets:

You need to watch the execution of the GenCo structure closely; it's designed to protect existing customers, but the success of this entire category hinges on quickly converting these massive capital outlays into contracted, revenue-producing assets. If onboarding takes too long, these become Dogs, defintely.

• Data Center Investment: $7.0 billion allocated within the 5-year, $28.0 billion CapEx plan.
• GenCo Risk: Initial contract requires two 1,300-MW turbines and 400 MW of battery storage.
• AI Productivity: 24% improvement in field productivity reported in Q2 2025.
• Low-Carbon Goal: 72% reduction in GHG emissions achieved from 2005 levels as of year-end 2024.

Finance: draft 13-week cash view by Friday.