Union Pacific (NYSE:UNP) reported stronger-than-expected second-quarter results on Thursday as higher freight volumes and pricing gains helped lift revenue and earnings above Wall Street forecasts.
The railroad operator also improved its earnings outlook for 2026 while reaffirming its broader financial and operational targets.
Revenue and earnings top expectations
Union Pacific posted adjusted earnings of $3.41 per share for the second quarter, exceeding analysts’ consensus estimate of $3.19.
Revenue increased 12% year over year to $6.9 billion, comfortably ahead of the $6.65 billion expected by the market.
Shares rose around 1.2% following the earnings release.
Freight growth supports record financial performance
Freight revenue, excluding fuel surcharges, increased 4% from a year earlier as higher shipment volumes, stronger core pricing and growth in other revenue more than offset an unfavourable business mix.
Net income climbed 6% to $2.0 billion compared with the second quarter of 2025.
Adjusted operating ratio came in at 59.2%, 110 basis points higher than a year ago, with higher fuel prices reducing performance by approximately 120 basis points.
Chief Executive Officer Jim Vena said, “Strong execution and volume growth enabled another successful quarter and record financial results.”
Company improves full-year outlook
Following the stronger quarter, Union Pacific increased its forecast for 2026 reported earnings per share growth to the high-single-digit range.
The company said the updated outlook remains consistent with its objective of delivering a high-single-digit to low-double-digit compound annual earnings growth rate through 2027.
Management also reaffirmed expectations for pricing gains to exceed inflation, continued improvement in the operating ratio, strong cash generation and planned capital spending of $3.3 billion during the year.
Operational performance continues to improve
Union Pacific reported improvements across several key operating metrics during the quarter.
Freight car velocity increased 5% to 231 daily miles per car, while average terminal dwell time improved 7% to 19.7 hours.
Workforce productivity rose 5% to 1,176 car miles per employee, and fuel efficiency improved 1% to 1.051 gallons per thousand gross ton-miles.
The company also reported improvements in both its personal injury rate and derailment rate, reflecting continued operational and safety progress.
Union Pacific stock price
