Union Pacific reported Thursday that its adjusted profit grew to $1.8 billion in the second quarter as merger rumors to swirl around the nation’s largest railroad.
The Omaha, Nebraska, per-share earnings rose rose to $3.03, beating Wall Street expectations and easily topping the $2.71 per-share profit it reported in the same period last year. Analysts were expecting profit of $2.91 per share for the recent quarter.
Operating revenue grew 2% over last year, to $6.2 billion, the company said.
Union Pacific shares rose about 1% before the bell Thursday, to $233.30 each. They had slumped to around $208 in early April, their lowest level of 2025, as President Donald Trump rolled out sweeping tariffs that threatened to upend global trade.
Shares of all U.S. railroads moved higher as well.
Sources told The Associated Press last week that Union Pacific and Norfolk Southern are in merger talks that would create the a railroad in North America that essentially connects the East and West Coasts.
Neither company has commented on the negotiations, which began during the first quarter of this year, according to a person familiar with the talks who wasn’t authorized to speak publicly about them. It would combine the largest and smallest of the country’s six major freight railroads.
There is widespread debate over whether such a merger would be approved by U.S. regulators, which have established a high bar for consolidation in the crucial industry.
That is largely because of a disastrous deal that involved Union Pacific. Union Pacific merged with Southern Pacific in 1996 and the tie-up led to an extended period of snarled rail traffic on U.S. rails. Three years later, Conrail was divvied up by Norfolk Southern and CSX, which led to more backups on rails in the East.
However, just two years ago the U.S. Surface Transportation Board did approve a deal that created the CPKC railroad, allowing Canadian Pacific to acquire Kansas City Southern for $31 billion.
That merger combined the two smallest major railroads in North America, however, but left only six major freight railroads. It was the first major rail merger approved in more than two decades.
To be approved, any major rail merger must show it will enhance competition and serve the public interest under the 2001 rules. The CPKC merger was not judged under those rules because Kansas City Southern had an exemption from them as the smallest major freight railroad at the time.
