Global insights driving the market strategies of tomorrow.

Union Pacific (UNP.US) Q3 misses expectations, revenue from railroad freight business grows 5%

Market IntelThursday, Oct 24, 2024 9:10 am ET

1min read

Union Pacific Corporation, a transportation industry leader focused on freight railroad services in the United States, has reported its financial results for the third quarter of 2024. The company's Q3 revenue grew 3% year-on-year to $6.09 billion, slightly below analysts' average estimate of $6.14 billion. Net profit was $1.671 billion, up 9% year-on-year; diluted EPS was $2.75, slightly below analysts' average estimate of $2.78.

The 3% year-on-year growth in revenue was driven mainly by volume growth and core pricing gains, partially offset by a decline in business mix and fuel surcharge revenue. Revenue from railroad freight services, excluding fuel surcharge income, grew 5%, while volume increased 6%.

Operating profit was $2.416 billion, up 11% year-on-year. The operating ratio (Operating Ratio) was 60.3%, up 310 basis points from the same period last year; the lower quarterly fuel prices had a positive 120 basis point impact on the operating ratio.

Looking ahead, the company expects its fourth-quarter performance to be in line with the third quarter but with year-on-year improvement. The company said that its earnings outlook remains positive due to strong service offerings, increasing network efficiency, and stable pricing. The company added that it expects a $1.5 billion stock buyback in 2024. The company maintains its long-term capital allocation strategy unchanged and continues to maintain a capital plan of approximately $3.4 billion.

As of the time of writing, Union Pacific fell nearly 4% before the market opened on Thursday.

Disclaimer: the above is a summary showing certain market information. AInvest is not responsible for any data errors, omissions or other information that may be displayed incorrectly as the data is derived from a third party source. Communications displaying market prices, data and other information available in this post are meant for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any security. Please do your own research when investing. All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. Keep in mind that while diversification may help spread risk, it does not assure a profit, or protect against loss in a down market.