Union Pacific (UNP) Q4 2025 earnings summary

Executive summary

• Achieved record net income of $7.1 billion (up 6%) and EPS of $11.98 (up 8%) for 2025, with best-ever safety, service, and operational results, including improvements in personal injury and derailment rates.

• Delivered strong productivity gains, cost control, and customer service, overcoming major weather disruptions and challenging macro conditions.

• Strategic focus and core pricing drove improved operating ratio and customer value.

• Volume growth in Coal, Industrial Chemicals & Plastics, and Metals & Minerals, while premium segment volumes declined.

Financial highlights

• Full year 2025 operating revenue rose 1% to $24.5 billion; operating income up 1% to $9.8 billion; net income up 6% to $7.1 billion.

• Adjusted operating ratio improved to 59.3%; reported OR at 59.8%.

• Q4 2025 net income was $1.8–$1.85 billion, with diluted EPS of $3.11; adjusted EPS was $2.86.

• Cash from operations reached $9.3 billion; free cash flow was $2.3 billion.

• Return on invested capital improved to 16.3%; adjusted debt/EBITDA stable at 2.7x.

Outlook and guidance

• 2026 outlook targets mid-single digit EPS growth, consistent with a 3-year CAGR of high-single to low-double digits through 2027.

• Operating ratio and ROIC expected to remain industry-leading; strong cash generation and annual dividend increases planned.

• Capital spending planned at $3.3 billion for 2026, prioritizing infrastructure and growth.

• Inflation expected to exceed 4% in 2026, with price increases to outpace inflation.

• Merger with Norfolk Southern targeted to close in first half of 2027, pending regulatory approval.