Union Pacific (UNP) Q1 2026 earnings summary

Executive summary

• Delivered record first quarter operating and financial results, with net income rising to $1.7 billion and diluted EPS of $2.87, reflecting strong execution, core pricing, productivity gains, and operational excellence, partially offset by inflation, rising fuel prices, and merger costs.

• Network performance, safety, and service metrics reached all-time highs, supporting customer commitments and business growth.

• Domestic Intermodal, Coal, and Grain growth was offset by lower International Intermodal volumes and softer vehicle sales.

• Affirmed long-term guidance for high single-digit to low double-digit EPS CAGR through 2027.

• Pending acquisition of Norfolk Southern is expected to create a transcontinental railroad, with $20 billion in cash consideration and 225 million shares to be issued, subject to regulatory approval.

Financial highlights

• Net income reached $1.7 billion, up 5% year-over-year; diluted EPS of $2.87 increased 6%; adjusted EPS of $2.93, up 9%.

• Operating income rose 4% to $2.5 billion; adjusted operating income up 5%.

• Operating revenue grew 3% to $6.2 billion; freight revenue up 4% despite 1% lower volume.

• Operating ratio improved to 60.5% (down 0.2 pts); adjusted operating ratio at 59.9% (down 0.8 pts).

• Cash from operations totaled $2.44 billion, up 10%; free cash flow was $631 million.

Outlook and guidance

• 2026 outlook affirmed: mid-single-digit EPS growth and further operating ratio improvement expected.

• Capital plan set at $3.3 billion, with ongoing annual dividend increases and focus on network growth, safety, and modernization.

• Pricing expected to exceed inflation, with strong service despite a muted economic forecast.

• Share repurchases remain paused pending completion of the Norfolk Southern acquisition.

• Sufficient liquidity maintained with $735 million in cash, $300 million in short-term investments, and $2.0 billion in available credit.