NiSource beats first-quarter profit estimates on robust power demand
Utilities continue to benefit from rising electricity usage - expected to reach record highs in 2025 and 2026, according to the U.S. Energy Information Administration - driven by surging power demand from data centers looking to match Big Tech's AI ambitions.
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In addition to the data centers, residences and commercial businesses have been using more electricity for transportation and heating, which has further increased demand for power.
"Despite market conditions and other forces beyond our control, the longevity of our plan is enduring and our investments are resilient," said CEO Lloyd Yates.
Across six states, the utility company serves natural gas to around 3.3 million customers through its Columbia Gas unit and electricity to 500,000 customers through its NIPSCO unit.
Quarterly total operating revenue for NiSource was $2.18 billion, compared with $1.71 billion a year earlier.
Its total customer revenue, which includes residential, commercial and industrial buyers at its electric and gas segments, increased 30.8% from a year earlier to $2.15 billion.
However, persistently high interest rates increased borrowing costs for power companies, which often require substantial capital for expenses such as maintaining and upgrading the electric grid.
NiSource said interest expenses rose 14.2% from a year earlier to $132.8 million in the reported quarter, while operating expenses were up nearly 27%.
The company reaffirmed its forecast for adjusted earnings to be between $1.85 and $1.89 per share. Analysts' average estimate was $1.87 per share.
The Merrillville, Indiana-based company reported a quarterly profit of 98 cents per share, compared with analysts' average estimate of 90 cents according to data compiled by LSEG.
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