Railroad company Union Pacific reports a new financial high in its performance.
Union Pacific Corporation (NYSE: UNP) has reported impressive financial results for the second quarter of 2025, demonstrating strong growth, operational efficiency, and strategic execution.
The railroad's operating revenues increased by 2-2.5% to $6.15–6.2 billion, primarily due to higher freight volumes and pricing gains. Freight revenues rose 4-6%, with significant growth in coal, intermodal, grain, and industrial chemicals.
Union Pacific's net income soared to approximately $1.88 billion, up from $1.67 billion in Q2 2024, and diluted EPS increased to $3.15 from $2.74, marking a 15% growth year-over-year. Operating income improved by 5% to about $2.5 billion, and the operating ratio dropped to 59.0%, indicating better cost efficiency and operational excellence.
Volume growth was strong across all three business segments, with overall revenue carloads rising 4%. Bulk shipments increased by 11%, industrial products climbed 3%, and intermodal was up 1%.
Notable operational enhancements included a 10% increase in freight car velocity and a 5% boost in locomotive productivity, demonstrating improvements in efficiency.
The company continues to focus on operational excellence, safety, and service leadership to support its long-term growth. A capital plan of $3.4 billion and planned share repurchases between $4.0 and $4.5 billion highlight disciplined capital allocation aiming to maintain industry-leading metrics such as its operating ratio and return on invested capital.
Coal volume growth was propelled by favorable natural gas prices and the start of service to the Sam Seymour Power Plant in La Grange, Texas. Despite some pressure from reduced fuel surcharges and other revenue mix challenges, pricing gains and volume increases have supported solid revenue growth.
Looking ahead, Union Pacific expects coal volumes to significantly exceed last year's levels. However, the railroad does not anticipate repeating the surge in international volume from West Coast ports in the second half of the year.
The company maintains its financial outlook for the year amid ongoing economic uncertainty surrounding tariffs and trade policy and the strength of consumer spending. The railroad does not provide any specific expectations or changes for its revenue, operating income, or earnings per share in this report.
In summary, Union Pacific's Q2 2025 results showcase a balanced growth strategy through volume expansion, pricing discipline, operational efficiency, and targeted capital investment, positioning the railroad well for sustained performance in 2025 and beyond.
The intermodal volumes significantly increased in Union Pacific's freight revenues, contributing to the overall growth in the industry. The finance sector is expected to see continued support from Union Pacific, as the company plans to allocate a large portion of its capital towards share repurchases.
