Union Pacific Corp. (UNP) Third Quarter (Q3) 2025 Financial Results Analysis
$UNP (Union Pacific Corp) reported its financial results for the third quarter of 2025 (ended September 30, 2025) on October 23, 2025, before the market opened. The company exceeded expectations with adjusted EPS of $3.08 (vs. $2.99 estimated, +3.0%, +12% YoY) and operating income of $6.2 billion (+3% YoY, slight miss vs. $6.25 billion total estimated). GAAP EPS was $3.01 (+9% YoY). Net income was $1.8 billion (+7% YoY). The adjusted operating ratio improved to 58.5% (-180 bps YoY), driven by record operating efficiency. Carload volume was flat, but freight pricing was up 4%. UNP shares rose ~1.2% in the after-market on the EPS and operating metrics beat, despite a revenue miss and a pause in repurchases following the merger with Norfolk Southern.
Below is a detailed structured analysis. Data comes from the official press release, earnings presentation, and post-earnings analysis.
1. Key Consolidated Results
$UNP (Union Pacific Corp) demonstrated exceptional operational execution in a stable volume environment, with pricing and productivity driving record margins. The focus on lean metrics highlights resilience, with adjusted OR at a historic low and strong cash generation.
Crecimiento: Ingresos +3%, YTD +3%. El CEO Jim Vena destacó: “Our third quarter results serve as a proof point that we are successfully executing on our strategy”.
2. Segment Analysis
$UNP (Union Pacific Corp) generated mixed growth by segment, with Bulk and Industrial driving revenues through pricing and volumes, offsetting weakness in Premium due to international intermodal. Total carloads were flat, but efficiency was up.
Observations: Bulk and Industrial revenues up ~70%; Premium recovery pending. YTD: Carloads up 3%. The CFO noted: “Strong service to meet customer demand; pricing dollars accretive to OR.”
3. Cash Flow, Balance Sheet and Other Indicators
$UNP (Union Pacific Corp) maintains a solid balance sheet with strong cash generation for capex and dividends, and improved leverage despite merger costs. Norfolk Southern pauses repurchases.
Cash Flow Ops YTD: Strong; supports capex.
Capex FY2025: $3.4 billion.
Adjusted Debt/EBITDA: 2.6x (2.7x YoY improvement).
Balance Sheet (September 30): Cash $808 million; total assets $68.6 billion; total debt $31.8 billion; equity not disclosed. Solid interest coverage. Dividend yield ~2.3%.
El CEO Vena comentó: “We have a historic opportunity with the Norfolk Southern to create America's first transcontinental railroad”.
4. Full Year 2025 Guide and Outlook
$UNP (Union Pacific Corp) reaffirmed its FY2025 outlook due to efficiency and pricing, despite intermodal headwinds. Focus on merger synergies and service for Q4.
Outlook 2026: EPS growth +8-10% due to merger upside and pricing; stable capex; risks: intermodal volumes, merger regulatory, economics.
5. Conclusion and Implications
$UNP (Union Pacific Corp)'s Q3 2025 results highlight its leadership in rail efficiency, with EPS and OR beats, revenue up, and operating records, offsetting revenue misses with solid fundamentals. Reaffirmed guidance and the Norfolk merger position UNP for transcontinental growth. Long-term, productivity and pricing support the upside. Recommendation: Hold for value investors (adjusted P/E ~20x, yield ~2.3%); catalysts in Q4 service and the 2026 merger.
This analysis is based on public data and is not financial advice. It is for informational purposes only and does not constitute an investment recommendation.
$UNP (Union Pacific Corp) reported its financial results for the third quarter of 2025 (ended September 30, 2025) on October 23, 2025, before the market opened. The company exceeded expectations with adjusted EPS of $3.08 (vs. $2.99 estimated, +3.0%, +12% YoY) and operating income of $6.2 billion (+3% YoY, slight miss vs. $6.25 billion total estimated). GAAP EPS was $3.01 (+9% YoY). Net income was $1.8 billion (+7% YoY). The adjusted operating ratio improved to 58.5% (-180 bps YoY), driven by record operating efficiency. Carload volume was flat, but freight pricing was up 4%. UNP shares rose ~1.2% in the after-market on the EPS and operating metrics beat, despite a revenue miss and a pause in repurchases following the merger with Norfolk Southern.
Below is a detailed structured analysis. Data comes from the official press release, earnings presentation, and post-earnings analysis.
1. Key Consolidated Results$UNP (Union Pacific Corp) demonstrated exceptional operational execution in a stable volume environment, with pricing and productivity driving record margins. The focus on lean metrics highlights resilience, with adjusted OR at a historic low and strong cash generation.
| Financial Metrics | Q3 2025 (GAAP/Adjusted) | YoY Growth | vs. Estimates | Notes |
| Operating Income | $6.2 billion | +3% | Leve miss | Freight rev $5.93B (+3%); pricing +4% excl. fuel. |
| GAAP Net Income | $1.8 billion | +7% | N/A | Tax rate ~21%; shares ~599M. |
| GAAP EPS (Diluted) | $3.01 | +9% | N/A | From $2.75 YoY. |
| Adjusted EPS | $3.08 | +12% | $2.99 (exceeded +3.0%) | Excludes $0.07 merger costs. |
| Operating Reason | 59.2% (GAAP) / 58.5% (adjusted) | -110 bps / -180 bps | N/A | Historic low; record efficiency. |
| Carloads Totales | 2.163 million | Flat | N/A | Premium -5%; Bulk +7%. |
| Dividend per Share | $1.34 (quarterly, +3%) | N/A | N/A | Annualized ~$5.36; yield ~2.3%. |
Crecimiento: Ingresos +3%, YTD +3%. El CEO Jim Vena destacó: “Our third quarter results serve as a proof point that we are successfully executing on our strategy”.
2. Segment Analysis$UNP (Union Pacific Corp) generated mixed growth by segment, with Bulk and Industrial driving revenues through pricing and volumes, offsetting weakness in Premium due to international intermodal. Total carloads were flat, but efficiency was up.
| Segment | Q3 Revenue ($M) | YoY Revenue Growth | Carloads Q3 (000s) | Key Notes |
| Bulk (Grain, Fertilizer, Coal, etc.) | $1,930 | +7% | 530 (+7%) | Coal +16%; Grain +6%; volúmenes up. |
| Industrial (Chemicals, Metals, Forest, Energy) | $2,194 | +3% | 574 (+3%) | Chemicals +8%; Metals +7%; pricing fuerte. |
| Premium (Automotive, Intermodal) | $1,803 | -2% | 1,059 (-5%) | Intermodal -3%; Automotive plano; headwinds intl. |
| Total Freight | $5,927 | +3% | 2,163 (flat) | Avg rev per car +3%; pricing accretive. |
Observations: Bulk and Industrial revenues up ~70%; Premium recovery pending. YTD: Carloads up 3%. The CFO noted: “Strong service to meet customer demand; pricing dollars accretive to OR.”
3. Cash Flow, Balance Sheet and Other Indicators$UNP (Union Pacific Corp) maintains a solid balance sheet with strong cash generation for capex and dividends, and improved leverage despite merger costs. Norfolk Southern pauses repurchases.
Cash Flow Ops YTD: Strong; supports capex.
Capex FY2025: $3.4 billion.
Adjusted Debt/EBITDA: 2.6x (2.7x YoY improvement).
Balance Sheet (September 30): Cash $808 million; total assets $68.6 billion; total debt $31.8 billion; equity not disclosed. Solid interest coverage. Dividend yield ~2.3%.
El CEO Vena comentó: “We have a historic opportunity with the Norfolk Southern to create America's first transcontinental railroad”.
4. Full Year 2025 Guide and Outlook$UNP (Union Pacific Corp) reaffirmed its FY2025 outlook due to efficiency and pricing, despite intermodal headwinds. Focus on merger synergies and service for Q4.
| Metric | MY 2025 | Notes |
| EPS growth (3-year CAGR) | High-single a low-double digits | Reaffirmed; focus on OR leadership. |
| Operating Reason | Industry-leading | Ongoing improvements for productivity. |
| Capex | $3.4 billion | Maintained; network investments. |
| Dividend Growth | +3% (Q3) | Annualized up; sustainable payout. |
| Share Repurchases | Paused | Por merger Norfolk Southern. |
| Q4 Volumes | Moderate decline | Intl intermodal headwind. |
Outlook 2026: EPS growth +8-10% due to merger upside and pricing; stable capex; risks: intermodal volumes, merger regulatory, economics.
5. Conclusion and Implications$UNP (Union Pacific Corp)'s Q3 2025 results highlight its leadership in rail efficiency, with EPS and OR beats, revenue up, and operating records, offsetting revenue misses with solid fundamentals. Reaffirmed guidance and the Norfolk merger position UNP for transcontinental growth. Long-term, productivity and pricing support the upside. Recommendation: Hold for value investors (adjusted P/E ~20x, yield ~2.3%); catalysts in Q4 service and the 2026 merger.
This analysis is based on public data and is not financial advice. It is for informational purposes only and does not constitute an investment recommendation.