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Union Pacific and Norfolk Southern post Q2 results amid merger speculation
Union Pacific reported operating revenue of $6.9 billion and an adjusted EPS of $3.41, while Norfolk Southern posted an operating ratio of 65.5% and EPS of $3.52 as results reflected volume gains tied to energy prices.
Yahoo Finance reports that both Union Pacific Corporation and Norfolk Southern Corporation released Q2 results on July 23, giving investors a clearer view of each company’s prospects as Union Pacific emphasized standalone growth while Norfolk Southern’s investment case is increasingly linked to a possible acquisition.
Union Pacific said operating revenue rose to $6.9 billion and adjusted EPS came in at $3.41, with results showing a 3% revenue surprise and a 5% EPS surprise, plus 6% EPS growth and 12% operating revenue growth year over year. The rail operator cited freight revenue growth of 12% driven by volume gains, fuel surcharge revenue, solid core pricing, and operational efficiency, and it reported an operating ratio of 59.2%, 10 basis points better than before. The company also highlighted intermodal strength, delivering its fourth consecutive record quarter in intermodal volume and revenue, with private asset, rail asset, and parcel volumes each rising by double digits.
Norfolk Southern’s results, according to Yahoo Finance, surpassed its expectations, with net income and EPS up 7%, alongside a volume-driven turnaround connected to higher energy prices linked to the Middle East conflict. The company reported a 5% increase in Intermodal volumes supported by trucking dynamics and recent business wins, and it said operating income improved 5%. Norfolk Southern posted an operating ratio of 65.5% and EPS of $3.52, noting the operating ratio increased 210 basis points versus the prior year while it continues to monitor energy prices, the consumer, and interest rates.
The two companies differed in how their outlooks and metrics stacked up, with Yahoo Finance noting Norfolk Southern’s EPS growth led on a percent basis, while Union Pacific pointed to stronger operational efficiency. The piece also compared forward growth rates, stating Union Pacific’s revenue forward growth rate was 4.40% versus Norfolk Southern’s 3.79%, and Union Pacific’s EBITDA forward growth rate was 6.31% versus the other company’s 3.79%.