NSP-Minnesota's Net Income Jumps 15.5% on Strong Revenue Growth

TL;DR

**NSP-Minnesota is powering up, with net income and revenues surging, making it a solid bet for utility investors.**

AI Summary

Northern States Power Company (NSP-Minnesota) reported a significant increase in net income and operating revenues for the nine months ended September 30, 2025. Net income rose to $686 million, a 15.5% increase from $594 million in the same period of 2024. Total operating revenues climbed to $4,848 million, up 7.8% from $4,499 million in 2024, driven by a 6.4% increase in electric revenues from non-affiliates to $3,929 million and a substantial 26.8% rise in natural gas revenues to $535 million. Operating expenses also increased, with operating and maintenance expenses up 10.4% to $1,065 million and depreciation and amortization rising 8.1% to $883 million. Capital/construction expenditures increased by $248 million to $2,291 million, reflecting ongoing infrastructure investments. The company's total assets grew to $30,366 million from $27,485 million at December 31, 2024, primarily due to an increase in property, plant and equipment, net, to $22,489 million. Long-term debt also increased to $8,504 million from $7,607 million, indicating increased leverage for capital projects. The company also saw a significant increase in finance lease right-of-use assets to $1,251 million from zero at year-end 2024.

Why It Matters

This strong performance by NSP-Minnesota, a key subsidiary of Xcel Energy, signals robust operational health in the utility sector, which is crucial for investors seeking stable, regulated returns. The increased capital expenditures, up by $248 million, suggest ongoing infrastructure modernization and expansion, potentially enhancing service reliability for customers and supporting job growth. However, the rise in long-term debt to $8,504 million could impact future financing costs and investor returns if interest rates continue to climb. In a competitive landscape, NSP-Minnesota's ability to grow revenues and manage expenses, despite increased O&M costs, demonstrates its resilience and strategic positioning within the energy market.

Risk Assessment

Risk Level: medium — The risk level is medium due to increased leverage and significant capital expenditures. Long-term debt increased by $897 million to $8,504 million, and capital/construction expenditures rose by $248 million to $2,291 million, which could expose the company to higher interest rate risks and project execution challenges. Additionally, the forward-looking statements highlight risks such as rising energy prices, changes in regulation, and the availability or cost of capital, which are inherent to the utility sector.

Analyst Insight

Investors should consider NSP-Minnesota's consistent revenue growth and increased net income as a positive indicator for its parent company, Xcel Energy. Monitor the company's capital expenditure efficiency and debt management strategies, especially given the rise in long-term debt. This filing suggests a stable, growing utility, but keep an eye on regulatory changes and interest rate trends that could impact future profitability.

Financial Highlights

debt To Equity

N/A

revenue

$4,848M

operating Margin

17.2%

total Assets

$30,366M

total Debt

$8,504M

net Income

$686M

eps

N/A

gross Margin

N/A

cash Position

N/A

revenue Growth

+7.8%

Revenue Breakdown

Key Numbers

• $686M — Net Income (Increased 15.5% from $594M in 2024 for the nine months ended Sept. 30, 2025.)
• $4.85B — Total Operating Revenues (Increased 7.8% from $4.50B in 2024 for the nine months ended Sept. 30, 2025.)
• $3.93B — Electric Revenues (non-affiliates) (Increased 6.4% from $3.69B in 2024 for the nine months ended Sept. 30, 2025.)
• $535M — Natural Gas Revenues (Increased 26.8% from $422M in 2024 for the nine months ended Sept. 30, 2025.)
• $1.07B — Operating & Maintenance Expenses (Increased 10.4% from $965M in 2024 for the nine months ended Sept. 30, 2025.)
• $2.29B — Capital/Construction Expenditures (Increased by $248M from $2.04B in 2024 for the nine months ended Sept. 30, 2025.)
• $8.50B — Long-Term Debt (Increased by $897M from $7.61B at Dec. 31, 2024.)
• $1.25B — Finance Lease Right-of-Use Assets (Increased from $0 at Dec. 31, 2024 to Sept. 30, 2025.)
• $30.37B — Total Assets (Increased from $27.49B at Dec. 31, 2024.)
• 1,000,000 — Common Shares Outstanding (Consistent at Sept. 30, 2025 and Dec. 31, 2024.)

Key Players & Entities

• NORTHERN STATES POWER CO (company) — Registrant
• Xcel Energy Inc. (company) — Parent company of NSP-Minnesota
• SEC (regulator) — Securities and Exchange Commission
• $686 million (dollar_amount) — Net income for nine months ended Sept. 30, 2025
• $594 million (dollar_amount) — Net income for nine months ended Sept. 30, 2024
• $4,848 million (dollar_amount) — Total operating revenues for nine months ended Sept. 30, 2025
• $4,499 million (dollar_amount) — Total operating revenues for nine months ended Sept. 30, 2024
• $2,291 million (dollar_amount) — Capital/construction expenditures for nine months ended Sept. 30, 2025
• $8,504 million (dollar_amount) — Long-term debt at Sept. 30, 2025
• FASB (regulator) — Financial Accounting Standards Board

FAQ

Risk Factors

• Regulatory Environment Changes [high — regulatory]: Changes in regulations governing utility operations, rate structures, and environmental standards can significantly impact profitability and operational flexibility. The company operates under various state and federal regulatory bodies, and adverse rulings or new compliance requirements could increase costs or limit revenue opportunities.
• Commodity Price Volatility [medium — market]: Fluctuations in the prices of natural gas and electricity generation fuels directly affect operating expenses. While the company attempts to mitigate these risks through hedging and long-term contracts, significant price spikes can strain margins if not fully recoverable through rates. For example, the cost of natural gas and purchased power increased in aggregate for the nine months ended Sept. 30, 2025.
• Infrastructure Reliability and Maintenance [medium — operational]: The company's extensive network of electric and natural gas infrastructure requires continuous maintenance and upgrades. Unexpected equipment failures, natural disasters, or cyberattacks could lead to service disruptions, significant repair costs, and reputational damage. Capital expenditures of $2,291 million reflect ongoing investments to maintain and enhance this infrastructure.
• Interest Rate and Financing Risk [medium — financial]: Increased reliance on debt financing, with long-term debt rising to $8,504 million, exposes the company to interest rate fluctuations. Higher interest rates increase financing costs, potentially impacting net income. The company also increased its finance lease right-of-use assets to $1,251 million, adding to its financial obligations.
• Environmental Regulations and Climate Change [high — regulatory]: Stricter environmental regulations related to emissions, renewable energy mandates, and climate change mitigation efforts can necessitate substantial capital investments and operational changes. Non-compliance or the need for accelerated transition to cleaner energy sources could pose significant financial and operational challenges.
• Cybersecurity Threats [medium — operational]: As a critical infrastructure provider, NSP-Minnesota is a potential target for cyberattacks. A successful breach could disrupt operations, compromise sensitive data, and lead to significant financial and reputational damage. The company's increasing reliance on digital systems amplifies this risk.

Industry Context

The utility sector is characterized by stable demand but faces increasing pressure from regulatory changes, environmental concerns, and the need for significant capital investment in grid modernization and renewable energy integration. Northern States Power Co. operates in a regulated environment where revenue is largely tied to approved capital expenditures and operational efficiency. Competition exists from other energy providers and the increasing adoption of distributed generation.

Regulatory Implications

NSP-Minnesota operates under strict regulatory oversight from state utility commissions and federal agencies. Changes in rate-setting methodologies, environmental compliance mandates (e.g., emissions standards), and renewable energy portfolio requirements can significantly impact financial performance and strategic planning. The company's substantial capital expenditures suggest ongoing efforts to comply with or adapt to evolving regulatory landscapes.

What Investors Should Do

1. Monitor regulatory filings and rate case outcomes.
2. Analyze the impact of increased capital expenditures on future cash flows and debt levels.
3. Assess the drivers behind the substantial increase in natural gas revenues.
4. Evaluate the financial implications of the new finance lease right-of-use assets.

Key Dates

• 2025-09-30: Nine Months Ended — Period for which financial results are reported, showing increased net income and revenues.
• 2024-12-31: Year-End — Prior period financial position used for comparison, showing lower total assets and long-term debt.
• 2025-02-27: Form 10-K Filing — Previous annual report filing, referenced for detailed financial statements and policies.

Glossary

Allowance for funds used during construction (AFUDC)

A component of construction work in progress that represents the cost of borrowed funds and equity capital used to finance construction of new utility plant. It is capitalized and included in the cost of the plant when it is placed in service. (AFUDC (equity) is reported as other income, and AFUDC (debt) reduces interest charges, impacting net income. The equity portion increased to $51 million for the nine months ended Sept. 30, 2025.)

Operating Revenues

The total revenue generated from the company's primary business activities, including the sale of electricity and natural gas. (Total operating revenues increased by 7.8% to $4,848 million for the nine months ended Sept. 30, 2025, indicating strong top-line performance.)

Operating Expenses

Costs incurred in the normal course of business operations, excluding interest and taxes. This includes fuel, maintenance, depreciation, and other operational costs. (Total operating expenses increased by 6.1% to $4,012 million, with significant rises in operating and maintenance expenses and depreciation.)

Finance Lease Right-of-Use Assets

Assets recognized under accounting standards for leases, representing the lessee's right to use an underlying asset for the lease term. (A substantial increase from $0 to $1,251 million indicates new significant leasing arrangements, impacting the balance sheet and potentially future cash flows.)

Capital/Construction Expenditures

Investments made by the company in property, plant, and equipment for the purpose of construction or expansion of its utility infrastructure. (Expenditures increased by $248 million to $2,291 million, highlighting ongoing investment in infrastructure modernization and expansion.)

Year-Over-Year Comparison

Compared to the prior year's nine-month period, Northern States Power Co. has demonstrated robust growth, with net income up 15.5% to $686 million and total operating revenues increasing by 7.8% to $4,848 million. This top-line growth was notably boosted by a significant 26.8% surge in natural gas revenues. While operating expenses also rose, particularly in operating and maintenance and depreciation, the company managed to improve its operating income. The balance sheet reflects increased investment in property, plant, and equipment, leading to higher total assets and a corresponding rise in long-term debt and the introduction of significant finance lease liabilities.

Key Financial Figures

• $0.01 — ding at October 30, 2025 Common Stock, $0.01 par value 1,000,000 shares Northern S

Filing Documents

• nspm-20250930.htm (10-Q) — 1699KB
• nspmex3101q32025.htm (EX-31.01) — 10KB
• nspmex3102q32025.htm (EX-31.02) — 10KB
• nspmex3201q32025.htm (EX-32.01) — 9KB
• 0001123852-25-000017.txt ( ) — 9624KB
• nspm-20250930.xsd (EX-101.SCH) — 46KB
• nspm-20250930_cal.xml (EX-101.CAL) — 76KB
• nspm-20250930_def.xml (EX-101.DEF) — 320KB
• nspm-20250930_lab.xml (EX-101.LAB) — 667KB
• nspm-20250930_pre.xml (EX-101.PRE) — 491KB
• nspm-20250930_htm.xml (XML) — 2047KB

FINANCIAL INFORMATION

PART I FINANCIAL INFORMATION

— Financial Statements (Unaudited)

Item 1 — Financial Statements (Unaudited) 4 Consolidated Statements of Income 4 Consolidated Statements of Comprehensive Income 5 Consolidated Statements of Cash Flows 6 Consolidated Balance Sheets 7 Consolidated Statements of Common Stockholder's Equity 8

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 8

— Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2 — Management's Discussion and Analysis of Financial Condition and Results of Operations 20

— Controls and Procedures

Item 4 — Controls and Procedures 23

OTHER INFORMATION

PART II OTHER INFORMATION

— Legal Proceedings

Item 1 — Legal Proceedings 23

— Risk Factors

Item 1A — Risk Factors 24

— Other Information

Item 5 — Other Information 24

— Exhibits

Item 6 — Exhibits 24

SIGNATURES

SIGNATURES 25 This Form 10-Q is filed by NSP-Minnesota. NSP-Minnesota is a wholly owned subsidiary of Xcel Energy Inc. Additional information on Xcel Energy is available in various filings with the SEC. This report should be read in its entirety. Definitions of Abbreviations Xcel Energy Inc.'s Subsidiaries and Affiliates (current and former) NSP-Minnesota Northern States Power Company, a Minnesota corporation NSP System The electric production and transmission system of NSP-Minnesota and NSP-Wisconsin operated on an integrated basis and managed by NSP-Minnesota NSP-Wisconsin Northern States Power Company, a Wisconsin corporation PSCo Public Service Company of Colorado SPS Southwestern Public Service Company Utility subsidiaries NSP-Minnesota, NSP-Wisconsin, PSCo and SPS Xcel Energy Xcel Energy Inc. and its subsidiaries Federal and State Regulatory Agencies EPA United States Environmental Protection Agency FASB Financial Accounting Standards Board FERC Federal Energy Regulatory Commission IRS Internal Revenue Service MPUC Minnesota Public Utilities Commission NDPSC North Dakota Public Service Commission PSCW Public Service Commission of Wisconsin SEC Securities and Exchange Commission SDPUC South Dakota Public Utilities Commission Other ALJ Administrative Law Judge ARO Asset retirement obligation ASU Accounting standards update C&I Commercial and Industrial CCR Coal combustion residuals CCR Rule Final rule (40 CFR 257.50 - 257.107) published by the EPA regulating the management, storage and disposal of CCRs as nonhazardous waste CEO Chief executive officer CERCLA Comprehensive Environmental Response, Compensation, and Liability Act CFO Chief financial officer CO 2 Carbon dioxide CUB Citizens Utility Board DOC Minnesota Department of Commerce DSM Demand side management ETR Effective tax rate FTR Financial transmission right GAAP United States generally accepted accounting principles GHG Greenhouse gas IPP Independent

Forward-Looking Statements

Forward-Looking Statements Except for the historical statements contained in this report, the matters discussed herein are forward-looking statements that are subject to certain risks, uncertainties and assumptions. Such forward-looking statements, including those relating to future sales, future expenses, future tax rates, future operating performance, estimated base capital expenditures and financing plans, projected capital additions and forecasted annual revenue requirements with respect to rider filings, expected rate increases or refunds to customers, expectations and intentions regarding regulatory proceedings, expected pension contributions, and expected impact on our results of operations, financial condition and cash flows of legal proceeding outcomes, as well as assumptions and other statements are intended to be identified in this document by the words "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "objective," "outlook," "plan," "project," "possible," "potential," "should," "will," "would" and similar expressions. Actual results may vary materially. Forward-looking statements speak only as of the date they are made, and we expressly disclaim any obligation to update any forward-looking information. The following factors, in addition to those discussed in NSP-Minnesota's Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2024 and subsequent filings with the SEC, could cause actual results to differ materially from management expectations as suggested by such forward-looking information: operational safety, including our nuclear generation facilities and other utility operations; successful long-term operational planning; commodity risks associated with energy markets and production; rising energy prices and fuel costs; qualified employee workforce and third-party contractor factors; violations of our Codes of Conduct; our ability to recover costs; changes in regulation; reductions in our credit ratings and the cost

— FINANCIAL INFORMATION

PART I — FINANCIAL INFORMATION

— FINANCIAL STATEMENTS

ITEM 1 — FINANCIAL STATEMENTS NSP-MINNESOTA AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED ) (amounts in millions) Three Months Ended Sept. 30 Nine Months Ended Sept. 30 2025 2024 2025 2024 Operating revenues Electric, non-affiliates $ 1,541 $ 1,444 $ 3,929 $ 3,694 Electric, affiliates 135 128 377 370 Natural gas 65 59 535 422 Other 2 2 7 13 Total operating revenues 1,743 1,633 4,848 4,499 Operating expenses Electric fuel and purchased power 526 591 1,486 1,514 Cost of natural gas sold and transported 18 13 279 175 Operating and maintenance expenses 375 338 1,065 965 Conservation program expenses 31 48 100 138 Depreciation and amortization 304 277 883 817 Taxes (other than income taxes) 65 53 199 173 Total operating expenses 1,319 1,320 4,012 3,782 Operating income 424 313 836 717 Other income, net 9 4 17 12 Allowance for funds used during construction — equity 18 15 51 39 Interest charges and financing costs Interest charges and other financing costs 112 92 308 271 Allowance for funds used during construction — debt ( 10 ) ( 8 ) ( 27 ) ( 19 ) Total interest charges and financing costs 102 84 281 252 Income before income taxes 349 248 623 516 Income tax expense (benefit) 36 ( 4 ) ( 63 ) ( 78 ) Net income $ 313 $ 252 $ 686 $ 594 See Notes to Consolidated Financial Statements 4 Table of Contents NSP-MINNESOTA AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) (amounts in millions) Three Months Ended Sept. 30 Nine Months Ended Sept. 30 2025 2024 2025 2024 Net income $ 313 $ 252 $ 686 $ 594 Other comprehensive income Derivative instruments: Net fair value increase, net of tax ( 1 ) — 3 12 Total other comprehensive income ( 1 ) — 3 12 Total comprehensive income $ 312 $ 252 $ 689 $ 606 See Notes to Consolidated Financial Statements 5 Table of Contents NSP-MINNESOTA AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (amounts in millions) Nine Months

Notes to Consolidated Financial Statements (UNAUDITED)

Notes to Consolidated Financial Statements (UNAUDITED) In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments necessary to present fairly, in accordance with GAAP, the financial position of NSP-Minnesota and its subsidiaries as of Sept. 30, 2025 and Dec. 31, 2024; the results of NSP-Minnesota's operations, including the components of net income, comprehensive income and changes in stockholder's equity for the three and nine months ended Sept. 30, 2025 and 2024; and NSP-Minnesota's cash flows for the nine months ended Sept. 30, 2025 and 2024. All adjustments are of a normal, recurring nature, except as otherwise disclosed. Management has also evaluated the impact of events occurring after Sept. 30, 2025 up to the date of issuance of these consolidated financial statements. These statements contain all necessary adjustments and disclosures resulting from that evaluation. The Dec. 31, 2024 balance sheet information has been derived from the audited 2024 consolidated financial statements included in the NSP-Minnesota Annual Report on Form 10-K for the year ended Dec. 31, 2024. Notes to the consolidated financial statements have been prepared pursuant to the rules and regulations of the SEC for Quarterly Reports on Form 10-Q. Certain information and note disclosures normally included in financial statements prepared in accordance with GAAP on an annual basis have been condensed or omitted pursuant to such rules and regulations. For further information, refer to the consolidated financial statements and notes thereto included in the NSP-Minnesota Annual Report on Form 10-K for the year ended Dec. 31, 2024, filed with the SEC on Feb. 27, 2025. Due to the seasonality of NSP-Minnesota's electric and natural gas sales, interim results are not necessarily an appropriate base from which to project annual results. 1. Summary of Significant Accounting Policies The significant accounting policies set forth in Note

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