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- **Record Financial Performance**: Q3 EPS up 12% to $3.08, driven by core pricing and operational efficiency, with operating ratio improving 180 basis points to 58.5%.
- **Strategic Merger Momentum**: Over 400 customer letters of support; regulatory filing expected by late November, targeting 15-20% faster service post-merger.
- **Resilient Cash Generation**: $7.1 billion cash flow, $1 billion debt reduction, and 2.6x debt-to-EBITDA ratio, despite $41 million merger costs.
- **Growth Pipeline**: New petrochemical and grain business wins, with 2026 outlook supported by $85 billion infrastructure investment.

**【CEO Summary Section】**
- Reported third-quarter EPS of $3.01 (adjusted for merger costs: $3.08), up 12% year-over-year, driven by core pricing gains and operational efficiency.
- Freight revenue excluding fuel set a record, with bulk and industrial segments outperforming despite softer international intermodal volumes.
- Operating ratio improved to 58.5%, a 180 basis point year-over-year improvement, supported by record workforce productivity and fuel efficiency.
- Emphasized merger with Norfolk Southern as a strategic opportunity to enhance competition and service, with regulatory filing expected by late November.

**【CFO Financial Commentary】**
- Adjusted EPS of $3.08 reflected strong cost control, with operating expenses up only 1% despite wage inflation and merger-related costs.
- Fuel expense growth moderated to 1%, benefiting from lower fuel prices and consumption rate improvements.
- Cash generation robust at $7.1 billion, with $1 billion debt reduction, lowering debt-to-EBITDA ratio to 2.6x.
- 2025 full-year guidance reaffirmed for high single to low double-digit EPS growth, despite macroeconomic headwinds.

**【Q&A Highlights】**
- **Merger Progress**: Over 400 customers submitted letters of support; merger application expected by late November, with focus on seamless integration and service improvements.
- **Volume Outlook**: Fourth-quarter volumes expected down 6% due to tough intermodal comparisons, but confident in maintaining service levels and pricing discipline.
- **Customer Wins**: New petrochemical business and grain infrastructure expansions driving growth, with pipeline of future wins supporting 2026 outlook.
- **Competitive Landscape**: Rivals' collaboration seen as validation of merger's competitive benefits; focus on delivering 15-20% faster service post-merger.


Union Pacific Corporation (UNP) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

UNP

UNP fundamentals

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