Union Pacific (UNP) Q3 2026 earnings summary

Executive summary

• Record Q3 operating revenue, operating income, and net income, supported by 6% carload growth, pricing gains, and operating execution.

• Diluted EPS rose 16% to $3.49; adjusted diluted EPS increased 15% to $3.53.

• Core pricing and productivity helped offset higher fuel costs and inflation; growth in Intermodal, Industrial, Energy & Specialized, and Grain partly offset lower Coal carloads.

Financial highlights

• Operating revenue was $7.197B, up 15% YoY; freight revenue was $6.813B, up 15%, and other revenue was $384M, up 21%.

• Operating income rose 15% to $2.943B; net income increased 16% to $2.076B. Adjusted net income was $2.098B, up 15%.

• Reported diluted EPS was $3.49, up 16%; adjusted diluted EPS was $3.53, up 15%.

• Operating expenses increased 15% to $4.254B, driven by higher fuel prices, volume-related costs, inflation, and depreciation; productivity partly offset the increase.

• Freight revenue excluding fuel surcharge rose 6%; fuel surcharge revenue was $1.171B.

Outlook and guidance

• FY2026 reported EPS growth guidance affirmed in the high-single-digit range, consistent with the high-single- to low-double-digit three-year CAGR target through 2027.

• Core-business operating ratio improvement remains an objective; high fuel prices and Q4 seasonality may pressure the reported ratio, while core OR is expected to improve YoY.

• FY2026 capital plan set at $3.5B; pricing dollars are expected to exceed inflation, with strong cash generation and annual dividend increases remaining targets.

• Q4 volume outlook cited export grain and renewable-fuels policy, industrial development and plant expansions, intermodal conversions and wins, and automotive wins offsetting softer vehicle sales.

• Q4 fuel projected at $4.85 per gallon versus $4.21 in Q3, with a greater operating-ratio impact than Q3's 140-bp drag if prices hold.