UNP · 10-Q · 2026Q2 · Full report

Operating Expense Trends

UNION PACIFIC CORP · 2026-07-23 · Importance 47 · Surprise 22 · Contradicted

Second-quarter operating expenses increased 13% to $4.101 billion from $3.629 billion, while six-month expenses increased 8% to $7.860 billion from $7.285 billion. Fuel expense increased because locomotive diesel prices and gross ton-miles rose, although fuel consumption rates improved 1% in the quarter and 2% year-to-date. Purchased services and materials increased 10% in the quarter and 9% year-to-date due to acquisition-related costs, inflation, and intermodal and subsidiary volume. Compensation expense declined 1% in the quarter as 3% lower employee levels and the absence of a $55 million 2025 crew-staffing ratification charge offset wage inflation and higher incentives.

Key facts

• Fuel expense in Q2 2026: $1,581 million compared to $1,179 million in Q2 2025. source
• Operating expenses increased 13% in Q2 2026 versus Q2 2025, primarily due to higher fuel prices, inflation, volume-related costs, acquisition-related expenses, and higher depreciation, partially offset by a $55 million favorable comparison from 2025 crew staffing agreement ratification charge and productivity. source
• Workforce productivity improved 5% and locomotive productivity improved 1% in Q2 2026 versus Q2 2025. source
• Total employees (average) decreased 3% in Q2 2026 to 28,786 from 29,711 in Q2 2025; year-to-date average employees decreased 4% to 28,716 from 29,929. source

Impact estimates