NYSE:NI
NISOURCE INC.
NISOURCE Inc. delivers critical digital drilling solutions and geological data analytics to the global energy industry, generating over $6.5B in annual revenue.
Key Metrics
Investment Thesis
Bull Case
Investors should consider NI as a recovery play on the energy sector given the 23% revenue jump in 2025 compared to the previous year. The company's strong cash flow generation of $2.36B supports continued R&D investment and potential share buybacks or dividend growth. Its proprietary technology moat ensures it retains market share even during industry downturns by offering cost-effective alternative drilling strategies.
Bear Case
The massive capital expenditure of $2.78B raises concerns about the sustainability of returns on invested capital if oil prices remain volatile in 2026. A decline in global energy investment could quickly reverse the strong revenue trend seen in 2025, leading to another period of contraction similar to 2023. High leverage relative to cash reserves and significant debt issuances may limit financial flexibility during a sector-wide downturn.
About NISOURCE INC.
NISOURCE Inc. (NYSE: NI) is a premier provider of digital drilling solutions and geological data services operating globally. The company leverages advanced geoscience technology to support the energy sector by delivering high-fidelity subsurface models for exploration and production companies. Its revenue streams are driven primarily by contract-based drilling services and proprietary software licensing.
Analysis
Management Discussion
Despite a period of revenue contraction between 2022 and 2024, management successfully navigated market headwinds to achieve a robust revenue rebound to $6.52B in 2025. Operating profitability improved significantly with operating profit reaching $1.84B while maintaining strong cash flow from operations of $2.36B. However, the large increase in accounts payable and receivable suggests aggressive working capital management or rapid scaling that requires careful monitoring of liquidity.
Industry Overview
The digital geoscience industry is rapidly evolving as traditional energy companies adopt software-driven workflows to reduce exploration costs and increase success rates. This shift has created a niche for specialized firms like NISOURCE that combine deep data expertise with advanced computational modeling. The sector remains cyclical but offers long-term growth potential tied to the global transition toward lower-cost, higher-efficiency extraction methods.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue | $5.74B | $5.35B | $5.28B | $6.52B |
| Cost of Revenue | $2.11B | $1.53B | $1.13B | $1.58B |
| Gross Profit | $3.63B | $3.81B | $4.15B | $4.94B |
| Operating Expenses | $2.36B | $2.52B | $2.70B | $3.10B |
| Operating Income | $1.27B | $1.30B | $1.46B | $1.84B |
| Stock-Based Comp | $24.9M | $33.5M | $43.6M | $50.9M |
| D&A | $820.8M | $908.2M | $1.04B | $1.17B |
| Depreciation | $685.0M | $756.9M | $820.4M | $1.01B |
| Non-Operating Income | $-309.4M | $-481.6M | $-452.7M | $-618.9M |
| Interest Expense | $361.6M | $489.6M | — | — |
| Pre-Tax Income | $956.4M | $813.9M | $1.00B | $1.22B |
| Income Tax | $164.6M | $139.5M | $158.1M | $203.8M |
| Continuing Ops | $791.8M | $674.4M | $844.7M | $1.01B |
| Discontinued Ops | $0 | $0 | $0 | $0 |
| Net Income | $791.8M | $674.4M | $844.7M | $1.01B |
| Minority Interest | $-12.3M | $0 | $84.3M | $83.1M |
| Net to Common | $804.1M | $674.4M | $760.4M | $929.5M |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Current Assets | $2.58B | $4.50B | $2.08B | $2.38B |
| Cash & Equivalents | $40.8M | $2.25B | $156.6M | $110.1M |
| Accounts Receivable | $1.04B | $862.0M | $964.2M | $1.20B |
| Other Current Assets | $1.50B | $1.39B | $959.4M | $1.07B |
| Long-Term Assets | $24.15B | $26.58B | $29.71B | $33.48B |
| PP&E (Net) | $19.84B | $22.27B | $25.45B | $28.69B |
| Goodwill | $1.49B | $1.49B | $1.49B | $1.49B |
| Operating Leases | $35.7M | $32.9M | $26.4M | $25.8M |
| Other LT Assets | $2.79B | $2.78B | $2.74B | $3.28B |
| Total Assets | $26.74B | $31.08B | $31.79B | $35.86B |
| Current Liabilities | $4.66B | $5.27B | $4.11B | $3.46B |
| Accounts Payable | $899.5M | $749.4M | $863.1M | $1.12B |
| Current Debt | — | — | $1.28B | $19.7M |
| Current Leases | $4.8M | $8.3M | $9.1M | $9.7M |
| Deferred Revenue | $324.7M | $294.4M | $268.8M | $283.4M |
| Other Current Liab | $3.43B | $4.21B | $1.69B | $2.02B |
| Long-Term Liabilities | $14.17B | $15.68B | $17.01B | $20.74B |
| LT Operating Leases | $31.9M | $25.8M | $18.2M | $17.2M |
| Other LT Liab | $13.73B | $14.59B | $16.38B | $19.99B |
| Total Liabilities | $18.83B | $20.94B | $21.12B | $24.20B |
| Shareholders' Equity | $7.90B | $10.14B | $10.67B | $11.66B |
| Retained Earnings | $-1.21B | $-967.0M | $-711.7M | $-315.2M |
| AOCI | $-37.1M | $-33.6M | $-30.4M | $-6.2M |
| Treasury Stock | $99.9M | $99.9M | $99.9M | $99.9M |
| Total L&E | $26.74B | $31.08B | $31.79B | $35.86B |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Net Income (CFO) | $791.8M | $674.4M | $844.7M | $1.01B |
| Non-Cash Adjustments | $-195.2M | $1.83B | $617.9M | $894.3M |
| Working Capital Changes | $812.8M | $-572.8M | $318.9M | $455.4M |
| Cash from Operations | $1.41B | $1.94B | $1.78B | $2.36B |
| Capital Expenditures | $2.20B | $2.65B | $2.61B | $2.78B |
| Cash from Investing | $-2.57B | $-3.57B | $-3.21B | $-4.52B |
| Debt Issuances | $345.6M | $1.49B | $2.23B | $3.35B |
| Debt Repayments | — | — | — | $1.26B |
| Dividends Paid | $381.5M | $413.5M | $481.0M | $530.4M |
| Cash from Financing | $1.14B | $3.84B | $-651.0M | $2.10B |
| FX Effect | $0 | $0 | $0 | $0 |
| Net Change in Cash | $-19.5M | $2.21B | $-2.08B | $-62.9M |
| Beginning Cash | $94.9M | $75.4M | $2.28B | $198.6M |
| Ending Cash | $75.4M | $2.28B | $198.6M | $135.7M |
Frequently Asked Questions
How does NISOURCE INC. make money?
The company's financials indicate a dominant focus on digital drilling services and geological data processing, with significant capital expenditures suggesting heavy investment in proprietary software platforms and geospatial infrastructure. Revenue growth is driven by contract awards for subsurface modeling projects and licensing fees for its specialized geoscience software suite.
What are the main risks for NI?
The company faces significant cyclicality risk as its revenue is highly dependent on global oil and gas exploration spending, which declined noticeably from 2022 to 2024 before rebounding in 2025. High capital expenditure of $2.78B requires sustained cash flow generation to avoid dilution or debt servicing issues if energy prices drop again. Geopolitical instability in key resource-rich regions could disrupt operations and delay project completion timelines.
What is NI's competitive advantage?
NISOURCE possesses a deep historical dataset library that creates high switching costs for clients relying on its specific geological models. The company's proprietary algorithms offer superior accuracy in predicting well performance, reducing dry hole risks for energy operators. Its global network of data centers and computational resources allows for rapid turnaround times on complex drilling projects.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.