Union Pacific Q2 Earnings & Revenues Surpass Estimates, Rise Y/Y

Core Insights - Union Pacific Corporation (UNP) reported second-quarter 2025 earnings of $3.03 per share, exceeding the Zacks Consensus Estimate of $2.91, marking a 10.6% year-over-year improvement driven by strong operational efficiency [1][10] - Operating revenues reached $6.2 billion, slightly surpassing the Zacks Consensus Estimate of $6.1 billion, with a year-over-year increase of 2.5% attributed to higher volumes and solid core pricing gains [2][10] Financial Performance - Freight revenues, which constitute 95% of total revenues, increased by 4% to $5.8 billion, exceeding the estimate of $5.67 billion, while other revenues fell by 16% to $311 million [3] - Total operating expenses rose by 1% year-over-year to $3.6 billion, with fuel expenses decreasing by 8% and compensation and benefits expenses increasing by 5% [4] - The operating ratio improved by 230 basis points year-over-year to 58.1% on an adjusted basis [4] Segment Performance - Bulk freight revenues increased by 10% year-over-year to $1.9 billion, with segmental revenue carloads rising by 11% [5] - Industrial freight revenues totaled $2.2 billion, up 4% year-over-year, while Premium division freight revenues decreased by 4% to $1.73 billion [6] Liquidity and Debt - Union Pacific ended the second quarter of 2025 with cash and cash equivalents of $1.06 billion, up from $1 billion at the end of 2024, while debt increased to $30.3 billion from $29.6 billion [7] Merger Discussions - Union Pacific is in advanced discussions with Norfolk Southern (NSC) regarding a potential business combination, although no further details have been disclosed [8][9]