Union Pacific Corporation (NYSE:UNP) reported first-quarter results on Thursday that came in ahead of analyst forecasts, driven by stronger efficiency and solid revenue performance.
Adjusted earnings per share reached $2.93, exceeding the consensus estimate of $2.86, as the rail operator delivered record operating revenue and improved key performance metrics.
Revenue totaled $6.22 billion, slightly above expectations of $6.21 billion and up 3% year-on-year. Freight revenue rose 4%, supported by core pricing gains, fuel surcharge income, and a favorable business mix, although partially offset by a 1% decline in carloads. The adjusted operating ratio improved by 80 basis points to 59.9%. Shares rose 1.4% following the announcement.
Operational momentum continues
“Our safety, service, and operating momentum continued in the first quarter as we further challenged ‘what’s possible’ from our great railroad,” said Jim Vena, Chief Executive Officer. “We grew reported net income 5%, increased earnings per share 6%, and improved our operating ratio.”
Profit growth and cost impacts
Net income came in at $1.7 billion for the quarter, compared with $1.6 billion in the same period last year. The results included merger-related costs of $36 million, or $0.06 per diluted share.
Efficiency gains across operations
The company reported improvements across several operational metrics. Freight car velocity increased 9% to 235 miles per day per car, while average terminal dwell time improved 11% to 19.7 hours. Locomotive productivity rose 6%, and fuel efficiency improved by 4%.
Outlook maintained for 2026
Union Pacific reaffirmed its outlook for 2026, expecting mid-single-digit growth in earnings per share along with continued improvement in its operating ratio.
The company maintained its capital expenditure plan of $3.3 billion and reiterated its commitment to steady annual dividend increases. Management also expects pricing gains to outpace inflation while continuing to meet customer demand in a subdued economic environment.