Union Pacific Corporation UNP reported worse-than-expected first-quarter 2025 results on Thursday.Union Pacific reported operating revenue of $6.027 billion, flat year-over-year, missing the consensus of $6.08 billion. Freight revenue was $5.691 billion, with Bulk up 1 % year over year, Industrial down 1%, and Premium up 5%. Revenue carloads were up 7%.Earnings per share were $2.70 compared to $2.69 a year ago, below the consensus of $2.75.“The team delivered a solid start to the year as we worked closely w ...

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Financial Performance - The company reported earnings of $2.70 per diluted share on net income of $1.6 billion for Q1 2025, unchanged from Q1 2024[86]. - Total operating revenues slightly decreased to $6.027 billion in Q1 2025 from $6.031 billion in Q1 2024[89]. - Other income decreased by 15% in Q1 2025 to $78 million compared to $92 million in Q1 2024[111]. - Free cash flow decreased to $468 million in Q1 2025 from $525 million in Q1 2024[136]. Revenue and Volume - Freight revenues increased by 1% to $5.691 billion in Q1 2025, driven by a 7% volume increase, offset by unfavorable business mix and lower fuel surcharge revenues[86][91]. - The company experienced a 33% increase in international intermodal business volume compared to Q1 2024[87]. - Revenues from shipments to and from Mexico decreased by 9% to $719 million in Q1 2025, driven by a 5% volume decline[102]. Operating Metrics - Operating ratio remained stable at 60.7% for both Q1 2025 and Q1 2024, with operating income also unchanged at $2.4 billion[86][88]. - Average revenue per car decreased by 5% to $2,714 in Q1 2025 compared to $2,855 in Q1 2024[97]. - Operating expenses decreased slightly to $3.656 billion in Q1 2025, driven by productivity and lower fuel prices[103]. - Gross ton-miles increased by 3% in Q1 2025 to 212.8 billion, while revenue ton-miles also increased by 3% to 104.0 billion[115]. - Freight car velocity improved by 6% in Q1 2025, reaching an average of 215 daily miles per car[117]. - Average terminal dwell time decreased by 6% in Q1 2025 to 22.1 hours[115]. Cash Flow and Investments - Cash provided by operating activities increased to $2,210 million in Q1 2025 from $2,122 million in Q1 2024[126]. - Total cash capital investments rose to $906 million in Q1 2025, up from $797 million in Q1 2024[129]. - In Q1 2025, the company generated $2.2 billion in cash from operating activities and repurchased $1.4 billion in shares[138]. Debt and Obligations - Interest expense decreased by 1% in Q1 2025 to $322 million, with a weighted-average debt level of $31.9 billion compared to $32.3 billion in Q1 2024[112]. - Total contractual obligations as of March 31, 2025, amounted to $64.768 billion, with $2.676 billion due in 2025[141]. - The company has $61.298 billion in debt obligations, with $1.874 billion due in 2025[141]. - Purchase obligations total $1.790 billion, with $568 million due in 2025[141]. - Operating leases total $1.176 billion, with $182 million due in 2025[141]. - The company expects to remain in compliance with its debt covenants[138]. Future Outlook - The capital plan for 2025 is expected to be approximately $3.4 billion, consistent with 2024, focusing on growth and infrastructure improvements[131]. - There are no known trends or uncertainties that are likely to materially affect the company's financial condition as of the filing date[140].

Union Pacific (UNP) Q1 2025 Earnings Call April 24, 2025 03:38 PM ET Company Participants Jim Vena - CEOJennifer Hamann - Executive VP & CFOKenny Rocker - Executive VP of Marketing & SalesEric Gehringer - Executive VP of OperationsKen Hoexter - Managing DirectorJonathan Chappell - Senior Managing DirectorJoseph Hafling - VP - Equity ResearchAndrzej Tomczyk - Vice PresidentDaniel Imbro - Managing DirectorJeff Kauffman - Partner, Transportation & Logistics Equity ResearchOliver Holmes - Director - Equity Rese ...

Financial Data and Key Metrics Changes - The reported operating ratio for Q1 2025 was 60.7%, flat compared to the previous year despite a 90 basis point headwind from fuel and leap year effects [5][16] - Earnings per share for Q1 2025 was $2.70, reflecting a $0.19 or 7% headwind from fuel and leap year [6][16] - Net income for Q1 2025 was $1.6 billion, essentially flat versus last year, with operating income also flat despite a 7% volume growth [7][16] Business Line Data and Key Metrics Changes - Freight revenue grew 1% year-over-year to $5.7 billion, with a 4% increase when excluding fuel surcharge impacts [9][10] - Bulk segment revenue was up 1% due to a 2% increase in volume, while industrial revenue decreased by 1% on a 1% decrease in volume [24][26] - Premium revenue increased by 5% on a 13% increase in volume, reflecting strong customer demand [27] Market Data and Key Metrics Changes - AAR car loadings were up just over 7% compared to last year, indicating a solid start to Q2 2025 [29] - Challenges are anticipated in the food and beverage sector, particularly in the U.S. beer market, while coal volumes are expected to remain strong [29] - Grain exports into Mexico are expected to remain robust, supported by business development efforts [30] Company Strategy and Development Direction - The company aims to maintain its three-year targets set during the Investor Day, focusing on EPS growth in the high single to low double-digit range [20][21] - Continued emphasis on service and operational excellence is a key part of the strategy, with a focus on maximizing pricing and efficiency [8][21] - The company is actively pursuing business development opportunities, including new customer acquisitions and expansions [35][36] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the uncertainty in the marketplace but expressed confidence in the company's ability to adapt and perform [21][60] - The first quarter performance was viewed positively, with strong volumes and service metrics heading into Q2 [22][57] - Management remains committed to long-term guidance despite current market volatility and challenges [21][72] Other Important Information - Operating expenses for Q1 2025 were $3.7 billion, flat year-over-year, with productivity gains offsetting inflation and volume-related costs [13][16] - The company returned $2.5 billion to shareholders in Q1 2025 through dividends and share repurchases [19] - The adjusted debt to EBITDA ratio was 2.8 times at the end of the quarter, maintaining an A-rating from credit agencies [19] Q&A Session Summary Question: 2025 Guidance and Uncertainty - Management acknowledged the uncertainty in the market but reiterated confidence in achieving long-term targets, emphasizing the importance of operational efficiency [56][61] Question: Revenue Growth Assumptions - Management indicated that while the first quarter was flat, they are optimistic about achieving high single-digit earnings growth, contingent on volume and pricing strategies [68][72] Question: Pricing Strength and Sustainability - Management noted that the strong pricing in Q1 was a result of both inflation catch-up and improved service performance, with expectations for continued pricing strength [80][84] Question: Impact of Tariffs and Trade Policies - Management highlighted the need for clarity regarding tariffs and trade policies, emphasizing the importance of maintaining customer relationships and adapting to changing supply chain patterns [121][123] Question: Resource Management for Volatility - Management confirmed that they maintain a buffer of resources to manage volatility and ensure service delivery, utilizing technology for efficient decision-making [132][136]

Core Insights - Union Pacific Corporation (UNP) reported first-quarter 2025 earnings of $2.70 per share, slightly missing the Zacks Consensus Estimate of $2.73, but showing a year-over-year improvement of 0.4% due to strong operational efficiency and favorable pricing [1] - Operating revenues were $6.03 billion, falling short of the Zacks Consensus Estimate of $6.09 billion, and reflecting a 0.07% decline year-over-year attributed to lower fuel surcharge revenues and an unfavorable business mix [2] - Freight revenues, which constitute 94.4% of total revenues, increased by 1% to $5.7 billion, supported by a 7% growth in overall volume [3] Financial Performance - Total operating expenses remained flat year-over-year at $3.7 billion, with fuel expenses decreasing by 8% and compensation and benefits expenses falling by 1% [4] - The operating income was stable at $2.4 billion year-over-year, while the operating ratio held steady at 60.7%, although it was negatively impacted by lower fuel prices and a leap year effect [4] Segment Analysis - Bulk freight revenues rose by 1% year-over-year to $1.84 billion, contrary to expectations of a 1.2% decline, with segmental revenue carloads improving by 2% [5] - Industrial freight revenues decreased by 1% year-over-year to $2.08 billion, with revenue carloads also declining by 1% [5] - Premium freight revenues increased by 5% year-over-year to $1.77 billion, surpassing expectations of a 0.6% decrease, with revenue carloads improving by 13% [6] Liquidity and Debt - Union Pacific ended the first quarter of 2025 with cash and cash equivalents of $1.41 billion, up from $925 million in the same quarter of 2024, while debt due after one year decreased to $30.6 billion from $31.2 billion [8] Future Outlook - The company anticipates that volumes will be influenced by a mixed economic environment, fluctuations in coal demand, and challenging year-over-year international intermodal comparisons, while pricing gains are expected to positively impact the operating ratio [10] - Earnings per share growth is aligned with the company's three-year compound annual growth rate (CAGR) target of high-single to low-double digits, with a commitment to maintaining an industry-leading operating ratio and return on invested capital [10] - The long-term capital allocation strategy remains unchanged, with a capital plan of $3.4 billion and share repurchases projected between $4 billion and $4.5 billion [11]

Here is how Union Pacific performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts: Union Pacific (UNP) reported $6.03 billion in revenue for the quarter ended March 2025, representing a year- over-year decline of 0.1%. EPS of $2.70 for the same period compares to $2.69 a year ago. The reported revenue represents a surprise of -1.00% over the Zacks Consensus Estimate of $6.09 billion. With the consensus EPS estimate being $2.73, the EPS surpr ...

Union Pacific (UNP) came out with quarterly earnings of $2.70 per share, missing the Zacks Consensus Estimate of $2.73 per share. This compares to earnings of $2.69 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -1.10%. A quarter ago, it was expected that this railroad would post earnings of $2.78 per share when it actually produced earnings of $2.91, delivering a surprise of 4.68%.Over the last four quarters, the company has ...

UNION PACIFIC CORPORATION FIRST QUARTER 2025 EARNINGS APRIL 24, 2025 EXECUTIVE SUMMARY FIRST QUARTER 2025 Jim Vena Chief Executive Officer 2 First Quarter Highlights & Executive Summary Highlights Executive Summary SAFETY + SERVICE & OPERATIONAL EXCELLENCE FINANCIAL REVIEW FIRST QUARTER 2025 Jennifer Hamann Executive Vice President & Chief Financial Officer 3 4 $2.70 Earnings per Share $2.4B Operating Income $1.6B Net Income 60.7% Operating Ratio Freight Car Velocity up 6% Workforce Productivity up 9% • Qua ...

Financial Performance - Union Pacific reported Q1 2025 net income of $1.6 billion, or $2.70 per diluted share, compared to $1.6 billion, or $2.69 per diluted share in Q1 2024[2]. - Net income for Q1 2025 was $1,626 million, a slight decrease of 0.9% from $1,641 million in Q1 2024[19]. - Cash provided by operating activities increased to $2,210 million in Q1 2025, up 4.1% from $2,122 million in Q1 2024[19]. - Free cash flow for Q1 2025 was $468 million, down 11% from $525 million in Q1 2024[19]. Revenue and Expenses - Operating revenue for Q1 2025 was $6.0 billion, flat year-over-year, with a 7% increase in revenue carloads and a 4% increase in freight revenue excluding fuel surcharge[5]. - Total operating expenses were flat at $3.7 billion, with productivity improvements offsetting volume-related costs and inflation[15]. - Freight revenue from intermodal shipments increased by 10% to $1.2 billion, while automotive freight revenue decreased by 5% to $581 million[16]. Operational Metrics - The operating ratio remained flat at 60.7%, impacted by lower fuel prices and a leap year, with a 90 basis point unfavorable effect[6]. - Quarterly freight car velocity improved by 6% to 215 daily miles per car, while workforce productivity increased by 9% to 1,091 car miles per employee[11]. - Average train speed decreased by 2% to 23.7 miles per hour in Q1 2025, down from 24.1 miles per hour in Q1 2024[21]. - Total revenue ton-miles increased by 3% to 104,011 million in Q1 2025, up from 101,265 million in Q1 2024[21]. - Average fuel price per gallon consumed decreased by 11% to $2.51 in Q1 2025, down from $2.81 in Q1 2024[21]. Capital and Investments - The capital plan for 2025 is set at $3.4 billion, with share repurchases expected to be between $4.0 billion and $4.5 billion[11]. - Capital investments rose to $906 million in Q1 2025, compared to $797 million in Q1 2024, reflecting a 13.7% increase[19]. Balance Sheet - Cash and cash equivalents increased to $1.4 billion as of March 31, 2025, up from $1.0 billion at the end of 2024[18]. - Total assets rose to $68.5 billion, compared to $67.7 billion at the end of 2024, with total liabilities increasing to $52.5 billion[18]. - Debt increased to $32,842 million as of March 31, 2025, from $31,192 million at the end of 2024[23]. - Adjusted debt to adjusted EBITDA ratio improved to 2.8 in Q1 2025, compared to 2.7 in Q4 2024[24]. Outlook - Union Pacific affirmed its 2025 outlook, targeting earnings per share growth consistent with a 3-year CAGR target of high-single to low-double digits[11].