Item 1. FINANCIAL STATEMENTS (continued)

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Item 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Condensed Statements of Consolidated Equity (unaudited)


























(in millions)	Common Stock		Treasury Stock		Additional Paid-In Capital		Retained Deficit		Accumulated Other Comprehensive Loss		Noncontrolling Interest in Consolidated Subsidiaries		Total
Balance as of December 31, 2025	$	4.8	$	(99.9)	$	9,866.6	$	(315.2)	$	(6.2)	$	2,209.8	$	11,659.9
Comprehensive Income:
Net income	—		—		—		507.1		—		49.1		556.2
Other comprehensive loss, net of tax	—		—		—		—		(3.0)		—		(3.0)
Dividends:
Common stock ($0.60 per share)	—		—		—		(292.1)		—		—		(292.1)

Noncontrolling Interests:

Contributions from noncontrolling interests	—		—		—		—		—		33.5		33.5
Distributions to noncontrolling interests	—		—		—		—		—		(23.1)		(23.1)


Stock issuances (redemptions):


Series A Preferred stock redemption premium	—		—		—		3.6		—		—		3.6

Employee stock purchase plan	—		—		1.9		—		—		—		1.9
Long-term incentive plan	—		—		(12.0)		—		—		—		(12.0)
401(k) and profit sharing	—		—		2.6		—		—		—		2.6

Balance as of March 31, 2026	$	4.8	$	(99.9)	$	9,859.1	$	(96.6)	$	(9.2)	$	2,269.3	$	11,927.5

























(in millions)	Common Stock		Treasury Stock		Additional Paid-In Capital		Retained Deficit		Accumulated Other Comprehensive Loss		Noncontrolling Interest in Consolidated Subsidiaries		Total
Balance as of December 31, 2024	$	4.7	$	(99.9)	$	9,521.5	$	(711.7)	$	(30.4)	$	1,984.1	$	10,668.3
Comprehensive Income:
Net income	—		—		—		474.8		—		51.9		526.7
Other comprehensive income, net of tax	—		—		—		—		1.2		—		1.2
Dividends:
Common stock ($0.56 per share)	—		—		—		(264.5)		—		—		(264.5)


Noncontrolling Interests:
Contributions from noncontrolling interests	—		—		—		—		—		34.8		34.8
Distributions to noncontrolling interest	—		—		—		—		—		(21.6)		(21.6)
Stock issuances (redemptions):




Employee stock purchase plan	—		—		1.7		—		—		—		1.7
Long-term incentive plan	—		—		(3.3)		—		—		—		(3.3)
401(k) and profit sharing	—		—		2.7		—		—		—		2.7

Balance as of March 31, 2025	$	4.7	$	(99.9)	$	9,522.6	$	(501.4)	$	(29.2)	$	2,049.2	$	10,946.0

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Condensed Statements of Consolidated Equity (unaudited) (continued)
















	Common
Shares (in thousands)	Shares	Treasury	Outstanding
Balance as of December 31, 2025	482,395	(3,963)	478,432
Issued:


Employee stock purchase plan	45	—	45
Long-term incentive plan	831	—	831
401(k) and profit sharing	57	—	57



Balance as of March 31, 2026	483,328	(3,963)	479,365














	Common
Shares (in thousands)	Shares	Treasury	Outstanding
Balance as of December 31, 2024	473,785	(3,963)	469,822
Issued:

Employee stock purchase plan	46	—	46
Long-term incentive plan	682	—	682
401(k) and profit sharing	68	—	68



Balance as of March 31, 2025	474,581	(3,963)	470,618

The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

1. Basis of Accounting Presentation

Our accompanying Condensed Consolidated Financial Statements (unaudited) reflect all normal recurring adjustments that are necessary, in the opinion of management, to present fairly the results of operations in accordance with GAAP in the United States of America. The accompanying financial statements include the accounts of us, our majority-owned subsidiaries, and VIEs of which we are the primary beneficiary after the elimination of all intercompany accounts and transactions.

The accompanying financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025. Income for interim periods may not be indicative of results for the calendar year due to weather variations and other factors.

The Condensed Consolidated Financial Statements (unaudited) have been prepared pursuant to the rules and regulations of the SEC. Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to those rules and regulations, although we believe that the disclosures made in this Quarterly Report on Form 10-Q are adequate to make the information herein not misleading.

2. Recent Accounting Pronouncements

Recently Issued Accounting Pronouncements

In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. We are currently evaluating the impacts this amendment will have on our internal-use software capitalization policy. See Note 2 to the Company’s Consolidated Financial Statements in the Annual Report on Form 10-K for the year ended December 31, 2025, for a discussion of the impact of this ASU.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40). We are currently evaluating the impacts this amendment will have on our required disclosures.See Note 2 to the Company’s Consolidated Financial Statements in the Annual Report on Form 10-K for the year ended December 31, 2025, for a discussion of the impact of this ASU.

3. Revenue Recognition

Revenue Disaggregation and Reconciliation. We disaggregate revenue from contracts with customers based upon reportable segment, as well as by customer class. The Columbia Operations segment provides regulated natural gas service and transportation for residential, commercial and industrial customers in Ohio, Pennsylvania, Virginia, Kentucky, and Maryland. The NIPSCO Operations segment provides regulated gas and electric service in the northern part of Indiana.

The tables below reconcile revenue disaggregation by customer class to segment revenue, as well as to revenues reflected on the Condensed Statements of Consolidated Income (unaudited):

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)


Three months ended March 31, 2026 (in millions)	Columbia Operations		NIPSCO Operations		Corporate and Other		Total
Gas Distribution
Residential	$	909.2	$	318.6	$	—	$	1,227.8
Commercial	331.0		115.6		—		446.6
Industrial	57.4		34.1		—		91.5
Off-system	16.8		—		—		16.8


Miscellaneous(1)	14.2		3.1		—		17.3
Subtotal	$	1,328.6	$	471.4	$	—	$	1,800.0
Electric Generation and Power Delivery
Residential	$	—	$	176.8	$	—	$	176.8
Commercial	—		172.1		—		172.1
Industrial	—		155.5		—		155.5
Wholesale	—		8.5		—		8.5
Public Authority	—		4.3		—		4.3
Miscellaneous(1)	—		5.1		—		5.1
Subtotal	$	—	$	522.3	$	—	$	522.3
Total Customer Revenues(2)	1,328.6		993.7		—		2,322.3
Other Revenues(3)	(5.4)		44.8		1.4		40.8
Total Operating Revenues	$	1,323.2	$	1,038.5	$	1.4	$	2,363.1
(1)Amounts included in Columbia Operations primarily relate to earnings share mechanisms, late fees, and wholesale revenues. Amounts included in NIPSCO Operations primarily relate to late fees and property rentals. (2)Customer revenue amounts exclude intersegment revenues. See Note 15, "Business Segment Information," for discussion of intersegment revenues. (3)Amounts included in Columbia Operations primarily relate to alternative revenue programs including weather normalization adjustment mechanisms. Amounts included in NIPSCO Operations primarily relate to alternative revenue programs including weather normalization adjustment mechanisms, MISO multi-value projects and revenue from FERC jurisdictional transmission assets. Amounts included in Corporate and Other primarily relate to products and services revenue.

Three months ended March 31, 2025 (in millions)	Columbia Operations		NIPSCO Operations		Corporate and Other		Total
Gas Distribution
Residential	$	851.2	$	291.4	$	—	$	1,142.6
Commercial	306.5		103.1		—		409.6
Industrial	47.9		31.4		—		79.3
Off-system	22.3		—		—		22.3
Wholesale	1.1		—		—		1.1

Miscellaneous(1)	10.9		4.7		—		15.6
Subtotal	$	1,239.9	$	430.6	$	—	$	1,670.5
Electric Generation and Power Delivery
Residential	$	—	$	167.9	$	—	$	167.9
Commercial	—		160.1		—		160.1
Industrial	—		142.6		—		142.6

Wholesale	—		7.6		—		7.6
Public Authority	—		2.2		—		2.2
Miscellaneous(1)	—		(1.4)		—		(1.4)
Subtotal	$	—	$	479.0	$	—	$	479.0
Total Customer Revenues(2)	1,239.9		909.6		—		2,149.5
Other Revenues(3)	0.7		31.8		1.2		33.7
Total Operating Revenues	$	1,240.6	$	941.4	$	1.2	$	2,183.2
(1)Amounts included in Columbia Operations primarily relate to earnings share mechanisms and late fees. Amounts included in NIPSCO Operations, primarily relate to revenue refunds, public repairs and property rentals. (2)Customer revenue amounts exclude intersegment revenues. See Note 15, "Business Segment Information," for discussion of intersegment revenues. (3)Amounts included in Columbia Operations primarily relate to alternative revenue programs including weather normalization adjustment mechanisms. Amounts included in NIPSCO Operations primarily relate to alternative revenue programs including weather normalization adjustment mechanisms, MISO multi-value projects and revenue from FERC jurisdictional transmission assets. Amounts included in Corporate and Other primarily relate to products and services revenue.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

Customer Accounts Receivable. Accounts receivable on our Condensed Consolidated Balance Sheets (unaudited) includes both billed and unbilled amounts, as well as certain amounts that are not related to customer revenues. Unbilled amounts of accounts receivable relate to a portion of a customer’s consumption of gas or electricity from the date of the last cycle billing through the last day of the month (balance sheet date). Factors taken into consideration when estimating unbilled revenue include historical usage, customer rates, and weather. A significant portion of our operations are subject to seasonal fluctuations in sales. During the heating season, primarily from November through March, revenues and receivables from gas sales are more significant than in other months. The balances of customer receivables as of March 31, 2026 and December 31, 2025 are presented in the table below. We had no significant contract assets or liabilities during the period. Additionally, we have not incurred any significant costs to obtain or fulfill contracts.


(in millions)	Customer Accounts Receivable, Billed (less reserve)		Customer Accounts Receivable, Unbilled (less reserve)
Balance as of December 31, 2025	$	698.8	$	465.2
Balance as of March 31, 2026	$	1,016.1	$	182.7

Utility revenues are billed to customers monthly on a cycle basis. We expect that substantially all customer accounts receivable will be collected following customer billing, as this revenue consists primarily of periodic, tariff-based billings for service and usage. We maintain common utility credit risk mitigation practices, including requiring deposits and actively pursuing collection of past due amounts. Our regulated operations also utilize certain regulatory mechanisms that facilitate recovery of bad debt costs within tariff-based rates, which provides further evidence of collectability. It is probable that substantially all of the consideration to which we are entitled from customers will be collected upon satisfaction of performance obligations.

Allowance for Credit Losses. To evaluate for expected credit losses, customer account receivables are pooled based on similar risk characteristics, such as customer type, geography, payment terms, and related macro-economic risks. Expected credit losses are established using a model that considers historical collections experience, current information, and reasonable and supportable forecasts. Internal and external inputs are used in our credit model including, but not limited to, revenue projections, actual charge-offs data, recoveries data, shut-offs, security deposits and final bill data. We continuously evaluate available information relevant to assessing collectability of current and future receivables. We evaluate creditworthiness of specific customers periodically or following changes in facts and circumstances. When we become aware of a specific commercial or industrial customer's inability to pay, an allowance for expected credit losses is recorded for the relevant amount. We also monitor other circumstances that could affect our overall expected credit losses including, but not limited to, creditworthiness of overall population in service territories, adverse conditions impacting an industry sector, and current economic conditions.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

At each reporting period, we record expected credit losses to an allowance for credit losses account. When deemed to be uncollectible, customer accounts are written-off. Rollforwards of our allowance for credit losses as of March 31, 2026 and December 31, 2025 are presented in the table below:


(in millions)	Columbia Operations		NIPSCO Operations		Total
Balance as of December 31, 2025	$	15.6	$	25.0	$	40.6
Current period provisions	11.8		6.6		18.4
Write-offs charged against allowance	(12.1)		(4.4)		(16.5)
Recoveries of amounts previously written off	3.2		0.4		3.6
Balance as of March 31, 2026	$	18.5	$	27.6	$	46.1


(in millions)	Columbia Operations		NIPSCO Operations		Total
Balance as of December 31, 2024	$	9.8	$	13.9	$	23.7
Current period provisions	42.3		25.0		67.3
Write-offs charged against allowance	(50.8)		(15.0)		(65.8)
Recoveries of amounts previously written off	14.3		1.1		15.4
Balance as of December 31, 2025	$	15.6	$	25.0	$	40.6

4. Noncontrolling Interests

Variable Interest Entities. A VIE is an entity in which the controlling interest is determined through means other than a majority voting interest. NIPSCO is the managing member and operator of two wind JVs, Rosewater and Indiana Crossroads Wind, which have 102 MW and 302 MW of nameplate capacity, respectively. NIPSCO is also a managing member and operator of two solar JVs, Indiana Crossroads Solar and Dunn's Bridge I, which have a nameplate capacity of 200 MW and 265 MW, respectively. We have determined that these JVs are VIEs. NIPSCO controls decisions that are significant to these entities' ongoing operations and economic results. Therefore, we have concluded that NIPSCO is the primary beneficiary and have consolidated all four entities.

Members of each respective JV include NIPSCO (who is the managing member) and a tax equity partner. Earnings, tax attributes and cash flows are allocated to both NIPSCO and the tax equity partner in varying percentages by category and over the life of the partnership. NIPSCO and each tax equity partner contributed cash to the respective JV. Once the tax equity partner has earned their negotiated rate of return and have reached a stated contractual date, NIPSCO has the option to purchase the remaining interest in the respective JV, at fair market value, from the tax equity partner. NIPSCO has an obligation to purchase 100% of the electricity generated by each commercially operational JV.

We did not provide any financial or other support for the JVs during the quarter that was not contractually required.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

Our Condensed Consolidated Balance Sheets (unaudited) included the following assets and liabilities associated with the JV VIEs.


(in millions)	March 31, 2026		December 31, 2025
Net property, plant and equipment	$	1,261.6	$	1,273.0
Current assets	27.6		27.6

Total assets(1)	1,289.2		1,300.6
Current liabilities	10.5		16.1
Asset retirement obligations	56.3		55.7
Finance lease obligations	40.1		40.1

Total liabilities(1)(2)	$	106.9	$	111.9

(1)The assets of each VIE represent assets of a consolidated VIE that can be used only to settle obligations of the respective consolidated VIE. The creditors of the liabilities of the VIEs do not have recourse to the general credit of the primary beneficiary. (2)In addition to the amounts disclosed above there is a de minimis amount of other noncurrent assets and liabilities at Rosewater as of March 31, 2026.

GenCo Minority Interest Transaction. In October 2025, a 19.9% equity interest in NiSource's wholly owned subsidiary, Generation Holdings II, the sole owner of GenCo, was issued to BIP Orion Holdco L.P. and BIP Orion Holdco II L.P., affiliates of Blackstone (collectively, “Blackstone Investor”), in exchange for $35.2 million in cash contributions to Generation Holdings II through the Generation Holdings II LLC Agreement. Generation Holdings II is considered a VIE as it passes the variability of its operating results through to its shareholders (Generation Holdings I and Blackstone Investor) and has insufficient equity to finance its activities without additional subordinated financial support. The sole purpose of the VIE is to own and operate GenCo which will acquire and build generation assets and provide capacity and electricity to support data center customers. Generation Holdings II and its wholly owned subsidiary, GenCo, is a consolidated VIE, as we have the power to direct the significant decision-making activities that most impact the ongoing operations and economic performance of the entity (i.e., we are the primary beneficiary) including business development and operating decisions. See Note 4 to the Company’s Consolidated Financial Statements in the Annual Report on Form 10-K for the year ended December 31, 2025, for additional details on the Generation Holdings II LLC Agreement.

During the first quarter of 2026, we received $8.0 million of contributions and we made zero distributions to our Generation Holdings II minority interest holders based on their relative ownership percentages. There were no contributions received or distributions made during the first quarter of 2025.

Our Condensed Consolidated Balance Sheets (unaudited) included the following assets and liabilities associated with the GenCo VIE:


(in millions)	March 31, 2026		December 31, 2025
Net Property, Plant and Equipment	$	244.8	$	39.7
Current assets	82.5		62.5
Other assets	201.5		305.4
Total assets(1)	528.8		407.6
Current liabilities	123.6		40.8


Total liabilities(1)	$	123.6	$	40.8

Voting Interest Entities. We retain a controlling financial interest in NIPSCO Holdings II and its subsidiaries and consolidate their financial results. See Note 4 to the Company’s Consolidated Financial Statements in the Annual Report on Form 10-K for the year ended December 31, 2025, for additional details on the Amended NIPSCO Holdings II LLC Agreement. The following table provides information about the contributions from and distributions to our NIPSCO minority interest holders

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

included in our Condensed Statements of Consolidated Cash Flows (unaudited) and Condensed Statements of Consolidated Equity (unaudited).


	Three Months Ended March 31,
(in millions)	2026		2025
Contributions from NIPSCO minority interest holders	$	25.5	$	34.8
Distributions to NIPSCO minority interest holders	19.9		17.5

5. Earnings Per Share

The calculations of basic and diluted EPS are based on the weighted average number of shares of common stock and potential common stock outstanding during the period. Diluted EPS includes the incremental effects of the various long-term incentive compensation plans and ATM forward sale agreements under the treasury stock method when the impact would be dilutive (See Note 6, "Equity").

We use the two-class method of computing earnings per share because we have participating securities in the form of non-vested restricted stock units with a non-forfeitable right to dividend equivalents, for which vesting is predicated solely on the passage of time. The calculation of earnings per share using the two-class method excludes income attributable to these participating securities from the numerator and excludes the dilutive impact of those shares from the denominator.

The following table presents the calculation of our basic and diluted EPS:


	Three Months Ended March 31,
(in millions, except per share amounts)	2026		2025
Numerator:
Net Income Available to Common Shareholders	$	510.7	$	474.8
Less: Income allocated to participating securities	1.1		0.8
Net Income Available to Common Shareholders - Basic	509.6		474.0

Net Income Available to Common Shareholders - Diluted	$	509.6	$	474.0
Denominator:
Average common shares outstanding - Basic	479.0		470.4
Dilutive potential common shares:


Shares contingently issuable under employee stock plans	1.6		1.4
Shares restricted under employee stock plans	0.1		0.7
ATM forward sale agreements	0.2		—
Average Common Shares - Diluted	480.9		472.5
Earnings per common share:
Basic	$	1.06	$	1.01
Diluted	$	1.06	$	1.00

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

6. Equity

ATM Program. In October 2025, we entered into eleven separate equity distribution agreements providing for the sale up to an aggregate of $1.5 billion of our common stock.

In October 2025, we executed a forward sale agreement, which allows us to issue a fixed number of shares at a price to be settled in the future. The forward purchaser under our forward sale agreement borrowed 2,390,057 shares from third parties, which the forward purchaser sold, through its affiliated agent, at a weighted average price of $41.84 per share. We may settle the forward sale agreement in shares, cash or net shares by October 2026. Had we settled all of the shares under the forward sale agreement at March 31, 2026, we would have received approximately $99.7 million, based on a net price of $41.72 per share.
In February 2026, we executed a forward sale agreement, which allows us to issue a fixed number of shares at a price to be settled in the future. The forward purchaser under our forward sale agreement borrowed 2,200,000 shares from third parties, which the forward purchaser sold, through its affiliated agent, at a weighted average price of $45.63 per share. We may settle the forward sale agreement in shares, cash or net shares by December 2026. Had we settled all of the shares under the forward sale agreement at March 31, 2026, we would have received approximately $99.9 million, based on a net price of $45.43 per share.
As of March 31, 2026, the ATM program inclusive of the outstanding forward sale agreements had approximately $1.25 billion of equity capacity available. The ATM program expires in December 2028.

Preferred Stock. During the first quarter of 2026, following the issuance of final U.S. Treasury and Internal Revenue Service regulations clarifying the scope and application of the federal excise tax on stock repurchases made after December 31, 2022, we evaluated the applicability of the excise tax to our 2023 Series A Preferred Stock redemption premium. Based on this assessment, we determined that the excise tax previously recorded does not apply to these share repurchases. Accordingly, we reversed approximately $3.6 million of excise tax expense and recognized a receivable as of March 31, 2026, for the expected refund of the amounts previously remitted.

7. Short-Term Borrowings

We generate short-term borrowings from our revolving credit facility, commercial paper program, and accounts receivable transfer programs. Each of these borrowing sources is described further below.

Revolving Credit Facility. We maintain a revolving credit facility to fund ongoing working capital requirements, including the provision of liquidity support for our commercial paper program, the issuance of letters of credit and general corporate purposes. Our revolving credit facility has a facility limit of $2.50 billion and is comprised of a syndicate of banks. We had no outstanding borrowings under this facility as of March 31, 2026 and December 31, 2025, respectively.

Commercial Paper Program. In March 2026, we increased our commercial paper program limit from $1.85 billion to $2.50 billion. We had $1,291.0 million and $736.0 million of commercial paper outstanding with weighted-average interest rates of 4.12% and 3.92% as of March 31, 2026 and December 31, 2025, respectively.

Accounts Receivable Transfer Programs. Columbia of Ohio, NIPSCO, and Columbia of Pennsylvania each maintain a receivables agreement whereby they transfer their customer accounts receivables to third-party financial institutions through consolidated special purpose entities. The three agreements expire between August 2026 and April 2027 and may be further extended if mutually agreed to by the parties thereto.

All receivables transferred to third parties are valued at face value, which approximates fair value due to their short-term nature. The amount of the undivided percentage ownership interest in the accounts receivables transferred is determined in part by required loss reserves under the agreements.

Transfers of accounts receivable are accounted for as secured borrowings resulting in the recognition of short-term borrowings on the Condensed Consolidated Balance Sheets (unaudited). As of March 31, 2026, the maximum amount of debt that could be borrowed related to our accounts receivable programs was $375.0 million.

We had no short-term borrowings related to the securitization transactions as of March 31, 2026 and December 31, 2025, respectively.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

For the three months ended March 31, 2026 and 2025, zero and $250.0 million, respectively, were recorded as cash flows from financing activities related to the change in short-term borrowings due to securitization transactions. Columbia of Ohio, NIPSCO and Columbia of Pennsylvania remain responsible for collecting on the receivables securitized, and the receivables cannot be transferred to another party.

Items listed above are presented net in the Condensed Statements of Consolidated Cash Flows (unaudited) as turnover is quick, the amounts are large, and their maturities are less than 90 days.

8. Regulatory Matters

Regulatory Assets and Liabilities. We follow the accounting and reporting requirements of ASC Topic 980, which provides that regulated entities account for and report assets and liabilities consistent with the economic effect of regulatory rate-making procedures when the rates established are designed to recover the costs of providing the regulated service and it is probable that such rates will be charged to and collected from customers. Certain expenses and credits subject to utility regulation or rate determination normally reflected in income or expense are deferred on the balance sheet and are recognized in the income statement as the related amounts are included in customer rates and recovered from or refunded to customers. We assess the probability of collection for all of our regulatory assets each period. The offset to the regulatory liability associated with our renewable investments included in regulated rates is recorded in "Depreciation and amortization" on the Condensed Statements of Consolidated Income (unaudited).

NIPSCO Electric rate case filing. Following the IURC order in June 2025, new rates were implemented in multiple steps beginning in July 2025 and the final step was implemented in March 2026.

Columbia of Pennsylvania rate case filing. Following the order in December 2025, rates became effective in January 2026. Two parties filed petitions for reconsideration on certain aspects of the final order; however, the Pennsylvania Public Utility Commission issued a final order in February 2026 denying reconsiderations and the timeline for appeal has passed.

NIPSCO Electric Special Contract and GenCo PPA filing. In November 2025, NIPSCO and GenCo filed an application with the IURC seeking approval of (i) a retail special contract for electric service between NIPSCO and ADS, (ii) a related power purchase agreement between NIPSCO and GenCo, and (iii) an alternative regulatory plan and associated accounting treatment. Testimony from the Indiana Office of the Utility Consumer Counselor ("OUCC") and intervenors was filed in January 2026. In February 2026, NIPSCO, GenCo, the OUCC, and the NIPSCO Industrial Group filed a Stipulation and Settlement Agreement ("Settlement") resolving all issues and accompanying testimony with the IURC. The Citizens Action Coalition is opposing the Settlement, and the LaPorte County Board of Commissioners is not opposing the Settlement. A settlement hearing occurred in April 2026. An order is anticipated in the second quarter of 2026.

In April 2026, NIPSCO submitted a compliance filing containing an amendment to the ADS Contract to accelerate the delivery of capacity to ADS. This compliance filing is expected to be acted upon at the same time as IURC's order noted above. NIPSCO and GenCo also filed an application with the IURC seeking approval of (i) a retail special contract for electric service between NIPSCO and a wholly owned subsidiary of Alphabet, (ii) a related power purchase agreement between NIPSCO and GenCo, and (iii) an alternative regulatory plan and associated accounting treatment. A procedural schedule has not been established, but an order is expected in the third quarter of 2026.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

202(c) Emergency Order for R.M. Schahfer coal facility. Before the planned retirement of the R.M. Schahfer coal facility at the end of December 2025, NIPSCO received the first of successive emergency orders under section 202(c) of the Federal Power Act, to continue operating in 90-day increments, currently through June 21, 2026. The orders stated that continued operation of R.M. Schahfer is required to meet an energy emergency across MISO’s North and Central regions. Consistent with the Federal Power Act and the U.S. Department of Energy regulations, the order authorizes NIPSCO to obtain cost recovery pursuant to 16 U.S.C. § 824a(c). As directed, NIPSCO continued to make R.M. Schahfer available in the MISO market. Following receipt of the initial emergency order, NIPSCO filed a complaint with FERC seeking a modification of the MISO tariff to establish a mechanism for recovery and allocation of the cost to comply with this order. In March 2026, FERC ordered MISO to make a compliance filing with tariff language for NIPSCO recovery and allocation of the cost to comply with this order within 30 days of FERC approving MISO’s tariff in Consumer’s FERC 202(c) complaint. NIPSCO filed a petition with the IURC to recover federally mandated costs related to the U.S. Department of Energy's 202(c) order in December of 2025, but the proceeding is being held in abeyance pending resolution of FERC/MISO level recovery of costs incurred while operating under the 202(c) order. While we do not believe IURC-level recovery under the FMCA Statute will be required, the petition was filed to preserve the right to seek such recovery if needed. Should such recovery become necessary, NIPSCO intends to file testimony and evidence outlining and justifying its request at a later date. As of March 31, 2026, $65.9 million has been deferred to non-current regulatory assets for incremental costs incurred to comply with the 202(c) Emergency Order and $54.4 million of non-current regulatory liabilities have been established for net MISO revenues and customer receipts in the first quarter of 2026. At present, NIPSCO is filing quarterly status reports with the IURC to keep them informed.

IURC Investigation. In November 2025, the IURC initiated an investigation into the accuracy of NIPSCO’s gas meters. This investigation followed NIPSCO's disclosure of a latent issue with a small percentage of the meter indexes in NIPSCO's gas meters, which was discovered during roll-out of new AMI communications modules for gas meters. NIPSCO filed testimony in March 2026 and a hearing is scheduled for July 2026.

9. Risk Management Activities

We are exposed to certain risks relating to our ongoing business operations, namely commodity price risk and interest rate risk. We recognize that the prudent and selective use of derivatives may help to limit volatility in the price of natural gas and manage interest rate exposure.

Risk management assets and liabilities on our derivatives are presented on the Condensed Consolidated Balance Sheets (unaudited) as shown below:


	March 31, 2026				December 31, 2025
(in millions)	Assets		Liabilities		Assets		Liabilities
Current(1)

Derivatives not designated as hedging instruments	$	4.9	$	2.9	$	9.7	$	2.1
Total	$	4.9	$	2.9	$	9.7	$	2.1
Noncurrent(2)

Derivatives not designated as hedging instruments	$	11.9	$	6.8	$	9.1	$	3.8
Total	$	11.9	$	6.8	$	9.1	$	3.8

(1)Current assets and liabilities are presented in "Other current assets" and "Other accruals", respectively, on the Condensed Consolidated Balance Sheets (unaudited).

(2)Noncurrent assets and liabilities are presented in "Deferred charges and other" and "Other noncurrent liabilities", respectively, on the Condensed Consolidated Balance Sheets (unaudited).

Our derivative instruments are subject to enforceable master netting arrangements or similar agreements. No collateral was either received or posted related to our outstanding derivative positions at March 31, 2026. If the above gross asset and liability positions were presented net of amounts owed or receivable from counterparties, we would report a net asset position of $7.1 million and $12.9 million as of March 31, 2026 and December 31, 2025, respectively.

Derivatives Not Designated as Hedging Instruments

Commodity price risk management. We, along with our utility customers, are exposed to variability in cash flows associated with natural gas purchases and volatility in natural gas prices. We purchase natural gas for sale and delivery to our retail, commercial and industrial customers, and for most customers the variability in the market price of gas is passed through in their

Table of Contents

ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

rates. Some of our utility subsidiaries offer programs whereby variability in the market price of gas is assumed by the respective utility. The objective of our commodity price risk programs is to mitigate the gas cost variability, for us or on behalf of our customers, associated with natural gas purchases or sales by economically hedging the various gas cost components using a combination of futures, options, forwards or other derivative contracts. As of March 31, 2026 and December 31, 2025, we had 82.2 MMDth and 83.7 MMDth, respectively, of net energy derivative volumes outstanding related to our natural gas hedges.

NIPSCO has received IURC approval to lock in a fixed price for its natural gas customers using long-term forward purchase instruments and is limited to 20% of NIPSCO's average annual GCA purchase volume. As of March 31, 2026, the remaining terms of these instruments range from one to six years. Likewise, Columbia of Pennsylvania has received approval for a 24-month rolling hedge program that will continue in perpetuity. The program is designed to financially hedge approximately 20% of the customers' annual demand. Under both programs, all gains and losses on these derivative contracts are deferred as regulatory liabilities or assets and are remitted to or collected from customers through the relevant cost recovery mechanism.

The following table summarizes the gains and losses associated with the commodity price risk programs deferred as regulatory assets and liabilities:


(in millions)	March 31, 2026		December 31, 2025
Regulatory Assets
Losses on commodity price risk programs	$	12.7	$	10.1
Regulatory Liabilities
Gains on commodity price risk programs	$	17.3	$	19.2

Our derivative instruments measured at fair value as of March 31, 2026 and December 31, 2025 do not contain any credit-risk-related contingent features.

Derivatives Designated as Hedging Instruments

Interest rate risk management. As of March 31, 2026 and December 31, 2025, we had no active interest rate swap positions. We have recorded the overall net loss related to previously settled interest rate swaps in AOCI. The gain or loss associated with each previously settled interest rate swap is amortized in interest expense over the term of each corresponding debt issuance. These amounts were immaterial for the three months ended March 31, 2026 and 2025 and are recorded in "Interest expense, net" on the Condensed Statements of Consolidated Income (unaudited). Amounts expected to be reclassified to earnings during the next twelve months are immaterial. See Note 14, "Accumulated Other Comprehensive Loss," for additional information.

Table of Contents

ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

10. Fair Value

A. Fair Value Measurements

Recurring Fair Value Measurements

The following tables present financial assets and liabilities measured and recorded at fair value on our Condensed Consolidated Balance Sheets (unaudited) on a recurring basis and their level within the fair value hierarchy as of March 31, 2026 and December 31, 2025. As of March 31, 2026 and December 31, 2025, there were no material transfers between fair value hierarchies. Additionally, there were no changes in the method or significant assumptions used to estimate the fair value of our financial instruments.


Recurring Fair Value Measurements March 31, 2026 (in millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Balance as of March 31, 2026
Assets


Risk management assets	$	—	$	16.8	$	—	$	16.8

Available-for-sale debt securities	—		156.7		—		156.7
Equity securities(1)(2)	8.7		—		—		8.7
Total	$	8.7	$	173.5	$	—	$	182.2
Liabilities

Risk management liabilities	$	—	$	9.7	$	—	$	9.7
Total	$	—	$	9.7	$	—	$	9.7

(1)Equity securities are in a high dividend equity fund and are valued using market prices in active markets. Level 1 instrument valuations are obtained from real-time quotes for transactions in active exchange markets involving identical assets. Equity securities are presented in "Other Investments" on the Condensed Consolidated Balance Sheets (unaudited).

(2)As of March 31, 2026, the investment cost of equity securities measured at fair value was $7.9 million, gross unrealized gains were $0.9 million, and the fair value was $8.7 million.


Recurring Fair Value Measurements December 31, 2025 (in millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Balance as of December 31, 2025
Assets



Risk management assets	$	—	$	18.8	$	—	$	18.8


Available-for-sale debt securities	—		146.1		—		146.1
Equity Securities(1)(2)	8.5		—		—		8.5
Total	$	8.5	$	164.9	$	—	$	173.4
Liabilities

Risk management liabilities	$	—	$	5.9	$	—	$	5.9
Total	$	—	$	5.9	$	—	$	5.9

(2)As of December 31, 2025, the investment cost of equity securities measured at fair value was $7.9 million, gross unrealized gains were $0.7 million, and the fair value was $8.5 million.

Level 1- When utilized, exchange-traded derivative contracts are based on unadjusted quoted prices in active markets and are classified within Level 1. These financial assets and liabilities are secured with cash on deposit with the exchange; therefore, nonperformance risk has not been incorporated into these valuations. These financial assets and liabilities are deemed to be cleared and settled daily by NYMEX as the related cash collateral is posted with the exchange. As a result of this exchange rule, NYMEX derivatives are considered to have no fair value at the balance sheet date for financial reporting purposes, and are

Table of Contents

ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

presented in Level 1 net of posted cash; however, the derivatives remain outstanding and are subject to future commodity price fluctuations until they are settled in accordance with their contractual terms.

Level 2- Certain non-exchange-traded derivatives are valued using broker or over-the-counter, on-line exchanges. In such cases, these non-exchange-traded derivatives are classified within Level 2. Non-exchange-based derivative instruments include swaps, forwards, and options. In certain instances, these instruments may utilize models to measure fair value taking into consideration credit risk. We use a similar model to value similar instruments. Valuation models utilize various inputs that include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, other observable inputs for the asset or liability and market-corroborated inputs, (i.e., inputs derived principally from or corroborated by observable market data by correlation or other means). Where observable inputs are available for substantially the full term of the asset or liability, the instrument is categorized within Level 2.

Level 3- Certain derivatives trade in less active markets with a lower availability of pricing information and models may be utilized in the valuation. When such inputs have a significant impact on the measurement of fair value, the instrument is categorized within Level 3.

Risk Management Assets and Liabilities. Risk management assets and liabilities include exchange-traded NYMEX futures and NYMEX options and non-exchange-based forward purchase contracts. NIPSCO and Columbia of Pennsylvania have entered into long-term forward natural gas purchase instruments to lock in a fixed price for natural gas customers. We value these contracts using a pricing model that incorporates market-based information when available, as these instruments trade less frequently and are classified within Level 2 of the fair value hierarchy. For additional information, see Note 9, "Risk Management Activities."

Available-for-Sale Debt Securities. Available-for-sale debt securities are investments pledged as collateral for trust accounts related to our wholly owned insurance company. We value U.S. Treasury, corporate debt and mortgage-backed securities using a matrix pricing model that incorporates market-based information. These securities trade less frequently and are classified within Level 2.

Our available-for-sale debt securities impairments are recognized periodically using an allowance approach. At each reporting date, we utilize a quantitative and qualitative review process to assess the impairment of available-for-sale debt securities at the individual security level. For securities in a loss position, we evaluate our intent to sell or whether it is more-likely-than-not that we will be required to sell the security prior to the recovery of its amortized cost. If either criteria is met, the loss is recognized in earnings immediately, with the offsetting entry to the carrying value of the security. If both criteria are not met, we perform an analysis to determine whether the unrealized loss is related to credit factors. The analysis focuses on a variety of factors that include, but are not limited to, downgrade on ratings of the security, defaults in the current reporting period or projected defaults in the future, the security's yield spread over treasuries, and other relevant market data. If the unrealized loss is not related to credit factors, it is included in other comprehensive income. If the unrealized loss is related to credit factors, the loss is recognized as credit loss expense in earnings during the period, with an offsetting entry to the allowance for credit losses. The amount of the credit loss recorded to the allowance account is limited by the amount at which the security's fair value is less than its amortized cost basis. If certain amounts recorded in the allowance for credit losses are deemed uncollectible, the allowance on the uncollectible portion will be charged off, with an offsetting entry to the carrying value of the security. Subsequent improvements to the estimated credit losses of available-for-sale debt securities will be recognized immediately in earnings. Continuous credit monitoring and portfolio credit balancing mitigates our risk of credit losses on our available-for-sale debt securities.

The amortized cost, gross unrealized gains and losses, allowance for credit losses, and fair value of available-for-sale securities at March 31, 2026 and December 31, 2025 were:


March 31, 2026 (in millions)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses(1)		Fair Value
Available-for-sale debt securities
U.S. Treasury debt securities	$	7.6	$	—	$	—	$	7.6
Corporate/Other debt securities	150.2		1.5		(2.6)		149.1
Total	$	157.8	$	1.5	$	(2.6)	$	156.7

December 31, 2025 (in millions)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses(2)		Fair Value
Available-for-sale debt securities
U.S. Treasury debt securities	$	9.5	$	—	$	—	$	9.5
Corporate/Other debt securities	136.3		2.4		(2.1)		136.6
Total	$	145.8	$	2.4	$	(2.1)	$	146.1

(1)Fair value of U.S. Treasury debt securities and Corporate/Other debt securities in an unrealized loss position without an allowance for credit losses is $4.6 million and $71.3 million, respectively, at March 31, 2026.

(2)Fair value of U.S. Treasury debt securities and Corporate/Other debt securities in an unrealized loss position without an allowance for credit losses is $3.5 million and $40.2 million, respectively, at December 31, 2025.

The cost of maturities sold is based upon specific identification. Net realized gains and losses on available-for-sale securities were de minimis for the three months ended March 31, 2026 and 2025, respectively. At March 31, 2026, approximately $10.6 million and $3.1 million of Corporate/Other debt securities and U.S. Treasury debt securities, respectively, had maturities of less than a year.

Equity Investments. Investments measured at net asset value per share (or its equivalent) as a practical expedient have not been classified in the fair value hierarchy. These investments represent holdings in a single private investment fund that are redeemable at the election of the holder. As of March 31, 2026 and December 31, 2025, the Company holds $18.2 million and $17.9 million of equity investments measured at net asset value, respectively.

Non-recurring Fair Value Measurements

We measure the fair value of certain assets, including goodwill, on a non-recurring basis, typically when events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. As of March 31, 2026, no non-recurring fair value adjustments have been made.

B. Other Fair Value Disclosures for Financial Instruments. The carrying amount of cash and cash equivalents, restricted cash, notes receivable, customer deposits and short-term borrowings is a reasonable estimate of fair value due to their liquid or short-term nature. Our long-term borrowings are recorded at historical amounts.

The following method and assumptions were used to estimate the fair value of each class of financial instruments.

Long-term Debt. The fair value of outstanding long-term debt is estimated based on the quoted market prices for the same or similar securities. Certain premium costs associated with the early settlement of long-term debt are not taken into consideration in determining fair value. These fair value measurements are classified within Level 2 of the fair value hierarchy. As of March 31, 2026, there was no change in the method or significant assumptions used to estimate the fair value of long-term debt.

The carrying amount and estimated fair values of these financial instruments were as follows:


(in millions)			Carrying Amount as of March 31, 2026						Estimated Fair Value as of March 31, 2026						Carrying Amount as of Dec. 31, 2025						Estimated Fair Value as of Dec. 31, 2025
Long-term debt (including current portion)			$	15,475.7					$	14,785.1					$	15,477.5					$	14,975.3

Table of Contents

ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

11. Income Taxes

Our interim effective tax rates reflect the estimated annual effective tax rates for 2026 and 2025 applied to year-to-date pretax income, adjusted for tax expense associated with certain discrete items. The effective tax rates for the three months ended March 31, 2026 and 2025 were 13.4% and 16.7%, respectively. These effective tax rates differ from the federal statutory tax rate of 21% primarily due to net income attributable to noncontrolling interest, amortization of excess deferred income taxes, federal tax credits net of deferred regulatory liabilities, state income taxes, and other permanent book-to-tax differences.

The decrease in the three month effective tax rate of 3.3% in 2026 compared to 2025 is primarily driven by increases in pass back of federal investment and production tax credits, amortization of excess deferred income taxes, and other permanent book-to-tax differences.

As of March 31, 2026, there have been no material changes to our unrecognized tax benefits or possible changes that could reasonably be expected to occur during the next twelve months. See Note 15 to the Company’s Consolidated Financial Statements in the Annual Report on Form 10-K for the year ended December 31, 2025, for a discussion of these unrecognized tax benefits.

12. Pension and Other Postemployment Benefits

We provide defined contribution plans and noncontributory defined benefit retirement plans that cover certain of our employees. Benefits under the defined benefit retirement plans reflect the employees' compensation, years of service and age at retirement. Additionally, we provide health care and life insurance benefits for certain retired employees. Certain active employees may become eligible for these benefits if they reach retirement age while working for us. The expected cost of such benefits is accrued during the employees' years of service. We determined that, for certain rate-regulated subsidiaries, the future recovery of postretirement benefit costs is probable, and we record regulatory assets and liabilities for amounts that would otherwise have been recorded to expense or accumulated other comprehensive loss. Current rates of rate-regulated companies include postretirement benefit costs, including amortization of the regulatory assets and liabilities that arose prior to inclusion of these costs in rates. For most plans, cash contributions are remitted to grantor trusts.

For the three months ended March 31, 2026 and 2025, we contributed $1.5 million and $0.5 million, respectively, to our pension plans and $1.1 million and $4.9 million, respectively, to our OPEB plans.

The following table provides the components of the plans' actuarially determined net periodic benefit cost for the three months ended March 31, 2026 and 2025:


	Pension Benefits				OPEB
Three Months Ended March 31, (in millions)	2026		2025		2026		2025
Components of Net Periodic Benefit Cost(1)
Service cost	$	5.3	$	4.9	$	0.8	$	1.0
Interest cost	14.1		16.0		4.6		5.6
Expected return on assets	(22.5)		(23.1)		(4.1)		(4.2)
Amortization of prior service credit	—		—		(1.1)		(0.4)
Recognized actuarial loss	5.9		6.4		0.1		0.4

Total Net Periodic Benefit Cost	$	2.8	$	4.2	$	0.3	$	2.4
(1)The service cost component and all non-service cost components of net periodic benefit (income) cost are presented in "Operation and maintenance" and "Other, net," respectively, on the Condensed Statements of Consolidated Income (unaudited).

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

13. Other Commitments and Contingencies

A. Guarantees and Indemnities. We and certain of our subsidiaries enter into various agreements providing financial or performance assurance to third parties on behalf of certain subsidiaries as a part of normal business. Such agreements include guarantees and stand-by letters of credit. These agreements are entered into primarily to support or enhance the creditworthiness otherwise attributed to a subsidiary on a stand-alone basis, thereby facilitating the extension of sufficient credit to accomplish the subsidiaries' intended commercial purposes. As of March 31, 2026 and December 31, 2025, we had issued letters of credit of $119.0 million for the benefit of third parties.

We provide guarantees related to our future performance under BTAs for our renewable generation projects. At March 31, 2026 and December 31, 2025, our guarantees for multiple BTAs totaled $27.2 million. See Note 19 to the Company’s Consolidated Financial Statements in the Annual Report on Form 10-K for the year ended December 31, 2025 for more information.

We provide guarantees related to some of our rail and pipeline service agreements. As of March 31, 2026 and December 31, 2025, if we do not meet our contractual obligations under the terms of these agreements we would be required to pay up to a maximum of $52.0 million.

B. Legal Proceedings. From time to time, various legal and regulatory claims and proceedings are pending or threatened against the Company and its subsidiaries. While the amounts claimed may be substantial, the Company is unable to predict with certainty the ultimate outcome of such claims and proceedings. The Company establishes reserves whenever it believes it to be appropriate for pending litigation matters. However, the actual results of resolving the pending litigation matters may be substantially higher than the amounts reserved. If one or more matters were decided against us, the effects could be material to our results of operations in the period in which we would be required to record or adjust the related liability and could also be material to our cash flows in the periods that we would be required to pay such liability. Due to the inherent uncertainty of litigation, there can be no assurance that the resolution of any particular claim, proceeding or investigation would not have a material adverse effect on our results of operations, financial position or liquidity.

Other Claims and Proceedings. We are also party to other claims, regulatory and legal proceedings arising in the ordinary course of business in each state in which we have operations, and based upon an investigation of these matters and discussion with legal counsel, we believe the ultimate outcome of such other legal proceedings to be individually, or in aggregate, not material at this time.

C. Environmental Matters. Our operations are subject to environmental statutes and regulations related to air quality, water quality, hazardous waste and solid waste. We believe that we are in substantial compliance with the environmental regulations currently applicable to our operations.

It is management's continued intent to address environmental issues in cooperation with regulatory authorities in such a manner as to achieve mutually acceptable compliance plans. However, there can be no assurance that fines and penalties will not be incurred. Management expects a majority of environmental assessment and remediation costs and asset retirement costs, further described below, to be recoverable through rates.

As of March 31, 2026 and December 31, 2025, we had recorded a liability of $81.4 million and $82.6 million, respectively, to cover environmental remediation at various sites. This liability is included in "Other accruals" and "Other noncurrent liabilities and deferred credits" in the Condensed Consolidated Balance Sheets (unaudited). We recognize costs associated with environmental remediation obligations when the incurrence of such costs is probable and the amounts can be reasonably estimated. The original estimates for remediation activities may differ materially from the amount ultimately expended. The actual future expenditures depend on many factors, including laws and regulations, the nature and extent of impact and the method of remediation. These expenditures are not currently estimable at some sites. We periodically adjust our liability as information is collected and estimates become more refined.

Table of Contents

ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

CERCLA. Our subsidiaries are potentially responsible parties at waste disposal sites under CERCLA and similar state laws. Under CERCLA, each potentially responsible party can be held jointly, severally and strictly liable for the remediation costs as the EPA, or state, can allow the parties to pay for remedial action or perform remedial action themselves and request reimbursement from the potentially responsible parties. Our affiliates have retained CERCLA environmental liabilities, including remediation liabilities, associated with certain current and former operations. At this time, we cannot estimate the full cost of remediating properties that have not yet been investigated, but it is possible that the future costs could be material to the Condensed Consolidated Financial Statements (unaudited).

MGP. We maintain a program to identify and investigate former MGP sites where our subsidiaries or predecessors may have liability. The program has identified 41 such sites where liability is probable. Remedial actions at many of these sites are being overseen by state or federal environmental agencies through consent agreements or voluntary remediation agreements.

We utilize a probabilistic model to estimate our future remediation costs related to MGP sites. The model was prepared with the assistance of a third party and incorporates our experience and general industry experience with remediating MGP sites. We perform an annual update of the model in the second quarter each year. Our total estimated liability related to the facilities subject to remediation was $74.3 million and $75.5 million at March 31, 2026 and December 31, 2025, respectively. The liability represents our best estimate of the probable cost to remediate the MGP sites. Remediation costs are estimated based on the best available information, applicable remediation standards at the balance sheet date and experience with similar facilities.

CCRs. NIPSCO continues to meet the compliance requirements established by the EPA for the regulation of CCRs. The CCR rule requirements currently in effect required revisions to previously recorded legal obligations associated with the retirement of certain NIPSCO facilities. The actual asset retirement costs related to the CCR rule may vary substantially from the estimates used to record the increased asset retirement obligation due to the uncertainty about the requirements that will be established by environmental authorities, compliance strategies that will be used, and the preliminary nature of available data used to estimate costs. As allowed by the rule, NIPSCO will continue to collect data over time to determine the specific compliance solutions and associated costs and, as a result, the actual costs may vary.

In May 2024, the EPA finalized changes to the current CCR regulations ("Legacy CCR Rule"), which address inactive surface impoundments at inactive facilities, referred to as legacy impoundments, and CCR management units ("CCRMUs") at inactive and active facilities. The rule largely requires these newly regulated units to conform to existing requirements, such as groundwater monitoring, closure requirements, and post-closure care. NIPSCO continues to assess whether existing legal obligations associated with the retirement of certain facilities must be revised and to estimate probable additional required asset retirement costs. NIPSCO expects to receive recovery of any such costs through existing and future depreciation rates.

D. Other Matters.

EPC Agreements. GenCo has entered into certain EPC contracts to construct generation capacity assets to support our data center strategy, requiring payments at specified periods. The assets contemplated by these contracts are subject to IURC approval. We may terminate for convenience the EPC Contracts and pay certain incurred project costs and termination fees if, for example, the ADS Contract is terminated or IURC approval of the underlying assets is not obtained.

Pool Resource Asset Agreements. During the first quarter of 2026, GenCo executed two fixed price ESA contracts to support the contracted customer demand, which are contingent on regulatory approval (such approval being the responsibility of the respective developers). GenCo has committed approximately $658.7 million under these ESAs over 15 years; however, GenCo has exercised an option and intends to convert one of these ESAs, which relates to a battery storage project (the “Tipton BESS Project”) with 167 MW nameplate capacity and expected to be completed in 2028, to a BTA (the “Tipton BTA”).

GenCo also entered into a battery e-storage supply agreement of which approximately $122.7 million is considered a noncancelable commitment as of March 31, 2026. We have provided a guarantee related to this agreement that would require us to pay up to a maximum of $350.6 million.

In addition, during the first quarter of 2026, NIPSCO entered into market capacity purchase agreements to secure additional capacity for the period 2028 through 2030 for approximately $174.6 million to support the contracted demand load of its data center customers. Subsequent to March 31, 2026, GenCo entered into a capacity agreement for the period from 2028 through 2040 for approximately $1.1 billion, also to support the contracted demand load of its data center customers. This agreement is subject to regulatory approval.

Table of Contents

ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

14. Accumulated Other Comprehensive Loss

The following tables display the components of Accumulated Other Comprehensive Loss, net of tax:


(in millions)	Gains and Losses on Securities(1)		Gains and Losses on Cash Flow Hedges(1)		Pension and OPEB Items(1)		Accumulated Other Comprehensive Loss(1)
Balance as of December 31, 2025	$	0.1	$	(13.6)	$	7.3	$	(6.2)
Other comprehensive income before reclassifications	(1.2)		0.1		(1.9)		(3.0)
Amounts reclassified from accumulated other comprehensive loss	—		(0.2)		0.2		—
Net current-period other comprehensive income (loss)	(1.2)		(0.1)		(1.7)		(3.0)

Balance as of March 31, 2026	$	(1.1)	$	(13.7)	$	5.6	$	(9.2)
(1)All amounts are net of tax. Amounts in parentheses indicate debits.


(in millions)	Gains and Losses on Securities(1)		Gains and Losses on Cash Flow Hedges(1)		Pension and OPEB Items(1)		Accumulated Other Comprehensive Loss(1)
Balance as of December 31, 2024	$	(4.0)	$	(13.2)	$	(13.2)	$	(30.4)
Other comprehensive income before reclassifications	0.8		—		0.3		1.1
Amounts reclassified from accumulated other comprehensive loss	—		(0.1)		0.2		0.1
Net current-period other comprehensive income (loss)	0.8		(0.1)		0.5		1.2

Balance as of March 31, 2025	$	(3.2)	$	(13.3)	$	(12.7)	$	(29.2)
(1)All amounts are net of tax. Amounts in parentheses indicate debits.

15. Business Segment Information

Our reportable segments reflect the manner in which our business is managed and our resources are allocated. Our operations are divided into two primary reportable segments, the Columbia Operations and the NIPSCO Operations segments. Columbia Operations aggregates the results of the fully regulated and wholly owned subsidiaries of NiSource Gas Distribution Group, Inc. (a holding company that owns Columbia of Kentucky, Columbia of Maryland, Columbia of Ohio, Columbia of Pennsylvania, and Columbia of Virginia). Each Columbia distribution company is an operating segment which we aggregate to form the Columbia Operations reportable segment. NIPSCO Operations includes the results of NIPSCO Holdings I and its majority-owned subsidiaries, including NIPSCO, which has regulated gas and electric operations in northern Indiana.

The remainder of our operations, which are not significant enough on a stand-alone basis to warrant treatment as a reportable segment, are presented as "Corporate and Other" and primarily are comprised of interest expense on holding company debt and unallocated corporate costs and activities, as well as new business development costs associated with GenCo. Refer to Note 3, "Revenue Recognition," for additional information on our segments and their sources of revenues. The following table provides information about our reportable segments. We use operating income as the primary measurement of performance for each of the reportable segments and make decisions on financing, dividends and taxes at the corporate level on a consolidated basis. We provide this measure to our CODM, the CEO, who utilizes it to assess performance and allocation of resources at the operating segment level based on budget-to-actual and actual-to-actual variances. Segment revenues include intersegment sales to affiliated subsidiaries, which are eliminated in consolidation. Affiliated sales are recognized on the basis of prevailing market, regulated prices or at levels provided for under contractual agreements. Operating income is derived from revenues and expenses directly associated with each segment.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)


Three Months Ended March 31, 2026
(in millions)	Columbia Operations		NIPSCO Operations		Total of Reportable Segments
Operating Revenues
External Revenue	$	1,323.2	$	1,038.5	$	2,361.7
Intersegment Revenue	3.4		0.3		3.7
Total Operating Revenue	$	1,326.6	$	1,038.8	$	2,365.4

Cost of energy	383.9		285.3		669.2
O&M	278.4		221.4		499.8
Depreciation	120.9		162.7		283.6
Total other taxes	71.1		20.9		92.0





Operating Income	$	472.3	$	348.5	$	820.8


Three Months Ended March 31, 2025
(in millions)	Columbia Operations		NIPSCO Operations		Total of Reportable Segments
Operating Revenues
External Revenue	$	1,240.6	$	941.4	$	2,182.0
Intersegment Revenue	3.2		0.3		3.5
Total Operating Revenue	1,243.8		941.7		2,185.5

Cost of energy	379.8		267.7		647.5
O&M	243.0		202.0		445.0
Depreciation	108.2		141.3		249.5

Total other taxes	67.0		18.5		85.5
Other segment items(1)	—		0.3		0.3




Operating Income	$	445.8	$	311.9	$	757.7

(1)Other segment items consists of Loss on Sale or Impairment of Assets and other segment income or expenses deemed insignificant which are used to reach our measurement of segment profit or loss, Operating Income.

The following table provides information about the assets of our reportable segments included in the Condensed Consolidated Balance Sheets (unaudited):


(in millions)	March 31, 2026		December 31, 2025
Assets
Columbia Operations	$	16,184.4	$	15,903.7
NIPSCO Operations	18,541.4		18,126.7
Corporate and Other	1,875.2		1,828.3
Consolidated Assets	$	36,601.0	$	35,858.7

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

To reconcile the segment tables above to consolidated NiSource:


Three Months Ended March 31, 2026
(in millions)	Total Reportable Segments		Corporate and Other		Eliminations		Consolidated NiSource
Total Operating Revenue	$	2,365.4	$	147.3	$	(149.6)	$	2,363.1
Operating Income (Loss)	820.8		(1.6)		—		819.2


Three Months Ended March 31, 2025
(in millions)	Total Reportable Segments		Corporate and Other		Eliminations		Consolidated NiSource
Total Operating Revenue	$	2,185.5	$	145.4	$	(147.7)	$	2,183.2
Operating Income	757.7		1.7		—		759.4

16. Other, Net

The following table displays the components of Other, Net included on the Condensed Statements of Consolidated Income (unaudited):


	Three Months Ended March 31,
(in millions)	2026		2025
Interest income	$	4.7	$	2.0
AFUDC equity	9.8		9.2
Pension and other postretirement non-service benefit (cost)	2.2		(3.8)


Miscellaneous	(2.3)		(1.6)
Total Other, net	$	14.4	$	5.8

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

17. Supplemental Disclosures of Cash Flow Information

The following table displays the components of Working Capital on the Condensed Statements of Consolidated Cash Flows (unaudited):


	Three Months Ended March 31,
(in millions)	2026		2025
Accounts receivable	$	(51.1)	$	(141.5)
Income tax receivable	7.9		—
Gas storage and other inventories	146.1		127.7
Accounts payable	(174.0)		(59.3)
Customer deposits and credits	(135.3)		(125.6)
Taxes accrued	12.5		34.2
Interest accrued	12.5		(14.8)
Exchange gas receivable/payable	(246.8)		40.9
Other accruals	16.9		28.6
Prepayments and other current assets	(64.4)		(20.0)
Accrued compensation and employee benefits	(55.8)		(75.5)
Total change in working capital	$	(531.5)	$	(205.3)


	Three Months Ended March 31,
(in millions)	2026		2025
Non-cash transactions:
Capital expenditures included in current liabilities	$	484.6	$	394.2
Advance deposits transferred to capital expenditures	108.5		—
Dividends declared but not paid	147.4		134.4

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

NiSource Inc.


Index			Page
Executive Summary			37
Summary of Consolidated Financial Results			40
Results and Discussion of Segment Operations			41
Columbia Operations			42
NIPSCO Operations			45
Liquidity and Capital Resources			49
Regulatory, Environmental and Safety Matters			54
Market Risk Disclosures			56
Other Information			57

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

NiSource Inc.

EXECUTIVE SUMMARY

This Management's Discussion and Analysis of Financial Condition and Results of Operations ("Management’s Discussion") includes management’s analysis of past financial results and certain potential factors that may affect future results, potential future risks and approaches that may be used to manage those risks. See "Note regarding forward-looking statements" at the beginning of this report for a list of factors that may cause results to differ materially.

Management's Discussion is designed to provide an understanding of our operations and financial performance and should be read in conjunction with our Condensed Consolidated Financial Statements (unaudited) included in this report and our Annual Report on Form 10-K for the fiscal year ended December 31, 2025.

We are an energy holding company under the Public Utility Holding Company Act of 2005 whose primary subsidiaries are fully regulated natural gas and electric utility companies serving customers in six states. We generate substantially all of our operating income through these rate-regulated businesses, which are summarized for financial reporting purposes into two primary reportable segments: Columbia Operations and NIPSCO Operations. Refer to ''Note 15, "Business Segment Information," in the Notes to the Condensed Consolidated Financial Statements (unaudited) for further discussion of our business segments.

Our vision is to be a premier, innovative and trusted energy partner. We exist to deliver safe, reliable and competitive energy that drives value to our customers. In order to achieve this goal, we seek to develop strategies that benefit all stakeholders as we (i) support long-term infrastructure investment and safety programs to better serve our customers, (ii) align our tariff structures and regulatory programs with our cost structure, and (iii) create value and enable growth in an evolving energy ecosystem. These strategies focus on improving safety and reliability, enhancing customer experience, pursuing regulatory and legislative initiatives to increase accessibility for customers currently not on our gas and electric service, ensuring customer value and reducing emissions while generating sustainable returns. The safety of our customers, communities and employees remains our focus. Serving as a guiding practice for our SMS, NiSource is certified in conformance to the American Petroleum Institute Recommended Practice 1173, which is the foundation to our journey towards operational excellence.

Data Center Contracts and Strategy: NIPSCO recently entered into a data center contract with a new customer and entered into amendments to its ADS Contract. Set forth below is a discussion of recent developments relating to our data center contracts and strategy. This discussion is supplemental to, and should be read in conjunction with, our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, in particular Part I, Item 1A, "Risk Factors—Data Center Operations and Strategy Risk" and Part II, Item 7, "Management’s Discussion and Analysis of Financial Condition and Results of Operations—Executive Summary—ADS Contract and Data Center Strategy."

Alphabet Contract

In March 2026, NIPSCO entered into an agreement with a wholly owned subsidiary of Alphabet, under which NIPSCO will provide electricity to the subsidiary’s data center(the “Alphabet Contract”). Under the Alphabet Contract, which is pending IURC approval, NIPSCO will provide service to Alphabet’s subsidiary pursuant to a capacity commitment beginning in summer 2026 and increasing to 300 MW commencing in 2030. The initial term of the Alphabet Contract is 15 years. Prior to receipt of applicable regulatory approvals from the IURC and FERC, NIPSCO will bill the customer for electric service under its base tariff. Following receipt of regulatory approvals, the customer will pay monthly capacity charges that are based on negotiated rates and actual consumption (subject to certain minimums), together with certain pass-through charges and an existing system charge which will be used to pass savings back to existing customers. The amounts we are entitled to receive from the customer are subject to adjustments including but not limited to resulting from tariff events or MISO accreditation changes. The customer's parent will provide credit support for the customer's payment obligations. Either party may terminate the Alphabet Contract upon certain defaults or failure to obtain necessary related approvals from the IURC and FERC. The Alphabet Contract contains other termination provisions which may be exercised following certain notice periods. If the customer terminates the Alphabet Contract, it is required to make certain termination payments that we believe will be sufficient to reimburse us for our investment costs and NIPSCO has certain obligations to mitigate.

The customer's electricity supply under the Alphabet Contract will be provided through a portfolio of electric generation assets and related assets owned or contracted for by NIPSCO and/or its affiliates (primarily including GenCo) and designed to serve the needs of the customer under the Alphabet Contract and other data center customers (the "Pool Resource Assets"). See “Data Center Strategy & Pool Resource Assets” below for additional information on the Pool Resource Assets. NIPSCO has entered into a PPA with GenCo in connection with the Alphabet Contract, which is pending IURC approval.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

NiSource Inc.

Amendments to ADS Contract

In March 2026, NIPSCO entered into an amendment to its ADS Contract to accelerate the delivery of capacity to ADS, resulting in increased committed capacity in the years 2027 through 2031. The amendment does not increase NIPSCO’s 2,400 MW maximum capacity commitment to ADS under the original ADS Contract but increases the amounts of power to be delivered before the maximum commitment is reached. The amendment is pending IURC approval. Pursuant to the amendment, ADS will regularly pay NIPSCO a fixed capacity charge (not subject to adjustment) from 2027 through 2031, regardless of any termination of the ADS Contract or reduction of capacity. The payment structure under this amendment is distinct from and does not alter the payment structure or the payments NIPSCO will receive under the original ADS Contract. Demand under this amendment is expected to be served through Pool Resource Assets (rather than Contract Assets under the ADS Contract).

In addition, in March and May of 2026, NIPSCO entered into amendments to the ADS Contract, subject to IURC and FERC approval, to increase the committed capacity that NIPSCO will provide beginning in 2029 and increasing to a total capacity commitment of 2,800 MW by the end of 2032 and through the end of the initial term of the ADS Contract. ADS will pay NIPSCO both a fixed capacity charge and an existing system charge designed to pass savings back to existing customers, for the increased capacity. Demand under these amendments is expected to be served through Pool Resource Assets (rather than Contract Assets under the ADS Contract).

Construction Update

GenCo continues to advance development of its new combined‑cycle natural gas‑fired generation facility to support the ADS Contract. During the period, the EPC contractor progressed engineering, procurement, and planning activities in support of construction mobilization currently anticipated in mid‑2026. The equipment supply contract for the CCGT units is progressing in accordance with planned delivery schedules.

GenCo is also advancing the development of a combined 400 MW and 100MW BESS installation. The battery equipment supply contract was awarded in February 2026, and the EPC contractor continues engineering, procurement, and planning activities to support the anticipated start of on-site construction in mid‑2026.

Data Center Strategy & Pool Resource Assets

We continue to experience strong demand from potential data center customers in our northern Indiana service territory and are engaged in negotiations with potential additional counterparties. Agreements we enter into with additional counterparties will be served by means of customized, dedicated generation assets, Pool Resource Assets, or a combination.

With respect to customers to be served by Pool Resource Assets, NIPSCO will retain discretion to select and dispatch Pool Resource Assets to meet committed customer demand in a way that maintains reliability and efficiency without direct involvement or approval from specific customers. We believe this model will enable us to allocate generation resources more efficiently and provide us with greater flexibility to serve a broader range of potential customers.

We evaluate potential transactions with Pool Resource Asset customers in the context of existing demand and resources within the pool in order to promote a sustainable alignment between committed customer demand within the pool and capacity available from Pool Resource Assets. We will add capacity resources to the Pool Resource Assets to maintain resource adequacy requirements and promote efficient resource utilization based on contracts with customers (subject to IURC approval). We anticipate that the total accredited capacity from the pool will be large enough to support the total load requirements of our data center customers taking into consideration MISO requirements. Pool Resource Assets may include generation assets that we develop or contract for (for example, via a BTA), as well as capacity agreements, ESAs, market capacity purchases or other similar agreements. In order to provide initial Pool Resource Assets to serve contracted demand, GenCo plans to construct new battery storage with 100MW nameplate capacity, which is expected to be completed in 2028, and has entered into a number of ESA contracts (including with respect to the Tipton BESS Project, which we intend to convert into a BTA) and other capacity purchase agreements. For more information on these agreements, see Note 13, "Other Commitments and Contingencies - D. Other Matters" – Pool Resource Asset Agreements.” We expect that the capacity provided by these initial Pool Resource Assets will suffice to meet substantially all contracted demand from the second half of 2028 through the expiration of the initial terms of our existing data center contracts.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

NiSource Inc.

Our ability to recover our investments and earn a return under our contracts with customers served by Pool Resource Assets will be driven by, among other factors, the terms of our contracts with these customers (including the charges we receive from customers and any potential adjustments to such charges), our ability to construct or procure sufficient Pool Resource Assets in a timely and cost-effective manner, and the performance by us and our customers under the contracts, rather than a traditional rate-making process.

Through certain of our subsidiaries, we have entered into certain construction and equipment supply contracts in relation to additional generation and transmission assets that may be used to serve potential future data center customers. As we continue to evaluate our potential data center opportunities, we will continue to focus on the community, financial, operational and regulatory factors that must be managed effectively in order to succeed with our data center strategy. We believe data center development can enhance our local tax base, diversify the employment base across the state of Indiana, and provide greater value to existing customers and shareholders. We continually evaluate ways to effectively manage the potential power demand, generation sources, and transmission capabilities to meet potential further load growth from additional data center customers, while at the same time focusing on our environmental goals.

In order to perform under any further data center contracts, we expect that we would need to develop additional generation and transmission assets, which may be significant, and obtain additional financing in connection with such development. For these and other reasons, our ability to successfully execute our data center strategy is subject to a number of risks and uncertainties. Refer to Part I, Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025.

Energy Transition: We continue to advance our energy transition strategy, primarily through the continuation and enhancement of existing programs, such as implementing our plan to retire and replace remaining coal-fired electric generation by 2028 with a balanced mix of low- or zero-emission electric generation, ongoing pipe replacement and modernization programs, and deployment of advanced leak detection and repair. We continue to make progress on our electric generation transition, initiated through our 2018 Plan, and we are continually adjusting to the dynamic energy landscape. Before the planned retirement of the R.M. Schahfer coal facility at the end of December 2025, NIPSCO received the first of successive emergency orders under section 202(c) of the Federal Power Act, to continue operating in 90-day increments, currently through June 21, 2026. The orders stated that continued operation of R.M. Schahfer is required to meet an energy emergency across MISO’s North and Central regions. Consistent with the Federal Power Act and the U.S. Department of Energy regulations, the order authorizes NIPSCO to obtain cost recovery pursuant to 16 U.S.C. § 824a(c). For additional information, see Note 8, "Regulatory Matters," and see Part I, Item 1A. "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025.

NIPSCO's 2021 Plan calls for a new natural gas peaking facility to replace existing vintage gas peaking facilities at the R.M. Schahfer Generating Station to support system reliability and resiliency, and upgrades to the electric transmission system. Following approval by the IURC in October 2024, the construction of a new 400 MW natural gas peaking generation facility is underway, which is expected to support the planned retirement of the existing vintage gas peaking facilities by the end of 2028. The 2021 Plan affirms the retirement of the Michigan City Generating Station by 2028 and calls for new natural gas peaking facilities. Final retirement dates for these units will be subject to MISO approval.

NIPSCO's 2024 Plan was submitted to the IURC on December 9, 2024. The 2024 Plan maintains the retirement decisions and capacity additions identified in the 2018 and 2021 Integrated Resource Plans and calls for additional generation resources through 2029 to support capacity requirements. The 2024 Plan informs future generation investments required to ensure reliability for NIPSCO’s customers and incorporates factors such as anticipated load growth from data centers and other economic development opportunities, EPA emissions rules, and evolving MISO resource accreditation rules. Given that the 90-day 202(c) order could continue to be issued every 90 days to keep R.M. Schahfer open for the foreseeable future, and given that MISO's resource accreditations for renewables and storage remain uncertain, it may be necessary to evaluate changes to our previously communicated resource timelines and alternative resource decisions. We plan to move as efficiently as possible while maintaining the integrity of our commercial, planning, regulatory, procurement and operational execution processes.

We continue to enhance safety and reduce methane emissions on our gas systems through modernization programs and utilization of advanced leak detection and repair. In addition, we plan to advance other low- or zero-emission energy resources and technologies, such as hydrogen and renewable natural gas.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

NiSource Inc.

Transformation: We are modernizing and unlocking efficiencies within our systems and processes on operational excellence, safety, operation and maintenance management. These efforts include investments in proven technologies backed with standardized processes that are changing the way we plan, schedule, and execute work in the field and how we engage and provide service to our customers. We continue to focus on our customer technology platforms. In addition to transforming technology to enhance our employee and customer experiences, we believe these programs will modernize systems and further reduce our enterprise risk related to end-of-life systems. During the first quarter, we also initiated a multi-year program, Value Captured, aimed at accelerating certain transformation activities in response to growing customer affordability concerns. This program is focused on operational efficiencies, evaluating target operating models and improving long-term scalability.

NIPSCO Union Contract Negotiations: On April 2, 2026, NIPSCO initiated a lockout of employees represented by the United Steelworkers following months of extensive negotiations to produce successor collective bargaining agreements by the contract expiration date of March 31, 2026. Agreements were reached and subsequently ratified by the physical and clerical bargaining units on April 24, 2026, and May 1, 2026, respectively, ending the lockout. During the lockout period, we incurred incremental costs to support our work continuity plans.

Economic Environment: We continue to monitor risks related to order and delivery lead times for construction and other materials, potential unavailability of materials due to global shortages in raw materials, and decreased construction labor productivity in the event of disruptions in the availability of materials. We continue to experience elevated material and supply costs in certain product sourcing categories driven by increased demand and tariffs. To the extent that work plan delays occur or our costs increase, our business operations, results of operations, cash flows, and financial condition could be materially adversely affected.

Summary of Consolidated Financial Results

A summary of our consolidated financial results for the three months ended March 31, 2026 and 2025 are presented below:


	Three Months Ended March 31,
(in millions, except per share amounts)	2026		2025		Favorable (Unfavorable)
Operating Revenues	$	2,363.1	$	2,183.2	$	179.9
Operating Expenses
Cost of energy	669.2		647.5		(21.7)
Other Operating Expenses	874.7		776.3		(98.4)
Total Operating Expenses	1,543.9		1,423.8		(120.1)
Operating Income	819.2		759.4		59.8
Total Other Deductions, Net	(177.2)		(127.0)		(50.2)
Income Taxes	85.8		105.7		19.9


Net Income	556.2		526.7		29.5
Net income attributable to noncontrolling interest	49.1		51.9		2.8
Net Income Attributable to NiSource	507.1		474.8		32.3
Preferred dividends redemption premium	3.6		—		3.6
Net Income Available to Common Shareholders	510.7		474.8		35.9
Earnings Per Share
Basic Earnings Per Share	$	1.06	$	1.01	$	0.05
Diluted Earnings Per Share	$	1.06	$	1.00	$	0.06

The majority of the costs of energy in both segments are tracked costs that are passed through directly to the customer, resulting in an equal and offsetting amount reflected in operating revenues.

The increase in net income available to common shareholders for the three months ended March 31, 2026 was primarily due to higher revenues associated with our capital investments, partially offset by higher operating expenses, including increased operation and maintenance expense and depreciation expense attributed to our net plant balances, as well as increased interest expense.

For additional information on operating income variance drivers see "Results and Discussion of Segment Operations" for Columbia Operations and NIPSCO Operations in this Management's Discussion.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

NiSource Inc.

Income Taxes

Refer to Note 11, "Income Taxes," in the Notes to the Condensed Consolidated Financial Statements (unaudited) for information on income taxes and the change in the effective tax rates for the periods presented.

RESULTS AND DISCUSSION OF SEGMENT OPERATIONS

Presentation of Segment Information

Columbia Operations aggregates the results of the fully regulated and wholly owned subsidiaries of NiSource Gas Distribution Group, Inc. Each Columbia distribution company is an operating segment which we aggregate to form the Columbia Operations reportable segment. NIPSCO Operations aggregates the results of NIPSCO Holdings I and its majority-owned subsidiaries, including NIPSCO, which has both fully regulated gas and electric operations in northern Indiana. The remainder of our operations, which are not significant enough on a stand-alone basis to warrant treatment as a reportable segment, are presented as "Corporate and Other" within the Notes to the Condensed Consolidated Financial Statements (unaudited) and primarily are comprised of interest expense on holding company debt, unallocated corporate costs and activities and new business development costs associated with GenCo.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

NiSource Inc.

Columbia Operations

Financial and operational data for the Columbia Operations segment for the three months ended March 31, 2026 and 2025 are presented below.


	Three Months Ended March 31,
(in millions)		2026			2025			Favorable (Unfavorable)
Operating Revenues		$	1,326.6		$	1,243.8		$	82.8
Operating Expenses
Cost of energy		383.9			379.8			(4.1)
Operation and maintenance		278.4			243.0			(35.4)
Depreciation and amortization		120.9			108.2			(12.7)


Other taxes		71.1			67.0			(4.1)
Total Operating Expenses		854.3			798.0			(56.3)
Operating Income		$	472.3		$	445.8		$	26.5
Revenues
Residential		$	907.5		$	858.0		$	49.5
Commercial		333.2			308.1			25.1
Industrial		58.0			48.2			9.8
Off-System		16.8			22.3			(5.5)
Wholesale and Other		11.1			7.2			3.9
Total		$	1,326.6		$	1,243.8		$	82.8
Sales and Transportation (MMDth)
Residential		88.5			90.8			(2.3)
Commercial		60.8			61.9			(1.1)
Industrial		77.0			72.1			4.9
Off-System		4.4			5.9			(1.5)
Wholesale and Other		0.2			0.2			—
Total		230.9			230.9			—
Heating Degree Days(1)		2,656			2,670			(14)
Normal Heating Degree Days(1)		2,636			2,666			(30)
% Colder than Normal		1		%	—		%
% Warmer than prior year		(1)		%
Columbia Operations Customers
Residential		2,244,188			2,233,968			10,220
Commercial		190,714			189,918			796
Industrial		1,981			1,988			(7)
Other		6			5			1
Total		2,436,889			2,425,879			11,010

(1) Heating degree figures represent averages of the five jurisdictions served by Columbia Operations.

Comparability of operation and maintenance expenses, depreciation and amortization, and other taxes may be impacted by regulatory, depreciation, and tax trackers that allow for the recovery in rates of certain costs.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

NiSource Inc.

Columbia Operations

The underlying reasons for changes in our operating revenues for the three months ended March 31, 2026 compared to the same period in 2025 are presented below.


	Favorable (Unfavorable)
Changes in Operating Revenues (in millions)	Three Months Ended March 31, 2026 vs 2025
Rates from base rate proceedings and regulatory capital programs	$	56.6

The effects of customer growth	1.2
The effects of weather in 2026 compared to 2025, net of weather and revenue normalization mechanisms	(14.2)



Other	4.5
Change in operating revenues (before cost of energy and other tracked items)	$	48.1
Operating revenues offset in operating expense
Higher tracker deferrals within operation and maintenance, depreciation, and tax	30.6
Higher cost of energy billed to customers	4.1

Total change in operating revenues	$	82.8

Weather

In general, we calculate the weather-related revenue variance based on changing customer demand driven by weather variance from normal heating degree days, net of weather and revenue normalization mechanisms. Normal weather is aligned with the definitions used in base rates for each jurisdiction, which typically reflect a 20-year average for all operating companies, other than Columbia of Virginia, which uses a 30-year average. In certain circumstances, normal weather as defined in base rates may differ from the assumptions used in normalization mechanisms. Our composite heating degree days reported do not directly correlate to the weather-related dollar impact on the results of Columbia Operations. Heating degree days experienced during different times of the year or in different operating locations may have more or less impact on volume and dollars depending on when and where they occur. When the detailed results are combined for reporting, there may be weather-related dollar impacts on operations when there is not an apparent or significant change in our aggregated composite heating degree day comparison.

Sales

The change in volumes for the three months ended March 31, 2026 compared to 2025 was a result of decreased usage from residential customers offset by increases in residential and commercial customer count.

Commodity Price Impact

Cost of energy for the Columbia Operations segment is principally comprised of the cost of natural gas procured and transported on behalf of and sold to customers while providing distribution services, as well as the transportation and storage costs of acquiring natural gas. All of our Columbia Operations companies have state-approved recovery mechanisms that provide a means for full recovery of prudently incurred gas costs. These are tracked costs that are passed through directly to the customer, and the gas costs included in revenues are matched with the gas cost expense recorded in the period. Any difference in actual costs incurred and amounts billed to customers is recorded on the Condensed Consolidated Balance Sheets (unaudited) as under-recovered or over-recovered gas cost to be included in future customer billings. Therefore, increases in these tracked operating expenses are offset by increases in operating revenues and have essentially no impact on net income. Certain Columbia Operations companies continue to offer choice opportunities, where customers can choose to purchase gas from a third-party supplier through regulatory initiatives in their respective jurisdictions.

The underlying reasons for changes in our operating expenses for the three months ended March 31, 2026 compared to the same period in 2025 are presented below.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

NiSource Inc.

Columbia Operations


	Favorable (Unfavorable)
Changes in Operating Expenses (in millions)	Three Months Ended March 31, 2026 vs 2025
Higher depreciation and amortization expense	$	(12.7)

Higher outside services expenses	(4.9)
Higher property tax	(2.3)







Other	(1.7)
Change in operating expenses (before cost of energy and other tracked items)	$	(21.6)
Operating expenses offset in operating revenue
Higher tracker deferrals within operation and maintenance, depreciation, and tax	(30.6)
Higher cost of energy billed to customers	(4.1)

Total change in operating expense	$	(56.3)

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