Information presented by Claude E. Elkins and Jason A. Zampi during NS' third quarter earnings conference call on October 23, 2025 (posted elsewhere on our website) included non-GAAP financial measures, as defined by Securities and Exchange Commission Regulation G. Non-GAAP financial measures should be considered in addition to, not as a substitute for, the financial measures reported in accordance with U.S. generally accepted accounting principles (GAAP).
Financial Results - excluding the Eastern Ohio incident1, restructuring and other charges2, merger-related expenses3, and sales of railway lines4 |
($ in millions, except per share amounts) |
Third Quarter 2025 | ||||||||||
Reported | Restructuring | Merger- | Adjusted | |||||||
2025 | Eastern Ohio | and Other | Related | 2025 | ||||||
(GAAP) | Incident1 | Charges2 | Expenses3 | (Non-GAAP1,2,3) | ||||||
Railway operating expenses | ||||||||||
Compensation and benefits | $ | 738 | $ | (24) | $ | - | $ | - | $ | 714 |
Purchased services and rents | 519 | - | - | - | 519 | |||||
Fuel | 237 | - | - | - | 237 | |||||
Depreciation | 348 | - | - | - | 348 | |||||
Materials and other | 147 | - | - | - | 147 | |||||
Merger-related expenses | 15 | - | - | (15) | - | |||||
Restructuring and other charges | 12 | - | (12) | - | - | |||||
Eastern Ohio incident | (11) | 11 | - | - | - | |||||
Total railway operating expenses | $ 2,005 | $ | (13) $ | (12) $ | (15) $ | 1,965 |
Income from railway operations | $ 1,098 | $ | 13 $ | 12 $ | 15 $ | 1,138 |
Income taxes | $ 213 | $ | 3 $ | 3 $ | 4 $ | 223 |
Net income | $ 711 | $ | 10 $ | 9 $ | 11 $ | 741 |
Earnings per share - diluted | $ | 3.16 | $ | 0.05 | $ | 0.04 | $ | 0.05 | $ | 3.30 |
Railway operating ratio (%) 64.6 (0.4) (0.4) (0.5) 63.3
Third Quarter 2024 | ||||||||||
Reported | Restructuring | Sales of | Adjusted | |||||||
2024 | Eastern Ohio | and Other | Railway | 2024 | ||||||
(GAAP) | Incident1 | Charges2 | Lines4 | (Non-GAAP1,2,4) | ||||||
Railway operating expenses | ||||||||||
Compensation and benefits | $ | 690 | $ | - | $ | - | $ | - | $ | 690 |
Purchased services and rents | 497 | - | - | - | 497 | |||||
Fuel | 216 | - | - | - | 216 | |||||
Depreciation | 339 | - | - | - | 339 | |||||
Materials and other | (188) | - | - | 380 | 192 | |||||
Restructuring and other charges | 60 | - | (60) | - | - | |||||
Eastern Ohio incident | (159) | 159 | - | - | - | |||||
Total railway operating expenses | $ 1,455 | $ | 159 $ | (60) $ | 380 $ | 1,934 |
Income from railway operations | $ 1,596 | $ | (159) $ | 60 $ | (380) $ | 1,117 |
Income taxes | $ 328 | $ | (39) $ | 15 $ | (93) $ | 211 |
Earnings per share - diluted | $ | 4.85 | $ | (0.53) | $ | 0.20 | $ | (1.27) | $ | 3.25 |
Net income | $ | 1,099 | $ | (120) | $ | 45 | $ | (287) | $ | 737 |
Second Quarter 2025 | |||
Reported | Restructuring | Adjusted | |
2025 | Eastern Ohio | and Other | 2025 |
(GAAP) | Incident1 | Charges2 | (Non-GAAP1,2) |
Railway operating ratio (%) 47.7 5.2 (2.0) 12.5 63.4
Railway operating expenses | ||||||||
Compensation and benefits | $ | 692 | $ | - | $ | - | $ | 692 |
Purchased services and rents | 520 | - | - | 520 | ||||
Fuel | 219 | - | - | 219 | ||||
Depreciation | 346 | - | - | 346 | ||||
Materials and other | 195 | - | - | 195 | ||||
Restructuring and other charges | 10 | - | (10) | - | ||||
Eastern Ohio incident | (47) | 47 | - | - |
Income from railway operations | $ | 1,175 | $ | (47) | $ | 10 | $ | 1,138 |
Total railway operating expenses $ 1,935 $ 47 $ (10) $ 1,972
Other income - net | $ | 24 | $ | - | $ | - | $ | 24 |
Net income | $ | 768 | $ | (35) | $ | 8 | $ | 741 |
Income taxes $ 230 $ (12) $ 2 $ 220
Earnings per share - diluted | $ | 3.41 | $ | (0.16) | $ | 0.04 | $ | 3.29 |
Railway operating ratio (%) 62.2 1.5 (0.3) 63.4
Revenue |
($ in millions) |
Third Quarter 2025 2024 Change % Change
Total revenue | $ | 3,103 | $ | 3,051 | $ | 52 | 2% |
Less: Fuel surcharge revenue | 208 | 238 | (30) | -13% | |||
Revenue less fuel surcharge revenue5 | $ | 2,895 | $ | 2,813 | $ | 82 | 3% |
Merchandise revenue | $ | 1,969 | $ | 1,861 | $ | 108 | 6% |
Less: Fuel surcharge revenue | 73 | 87 | (14) | -16% | |||
Merchandise revenue less fuel surcharge revenue5 | $ | 1,896 | $ | 1,774 | $ | 122 | 7% |
Intermodal revenue | $ | 759 | $ | 763 | $ | (4) | -1% |
Less: Fuel surcharge revenue | 131 | 142 | (11) | -8% | |||
Intermodal revenue less fuel surcharge revenue5 | $ | 628 | $ | 621 | $ | 7 | 1% |
Coal revenue | $ | 375 | $ | 427 | $ | (52) | -12% |
Less: Fuel surcharge revenue | 4 | 9 | (5) | -56% | |||
Coal revenue less fuel surcharge revenue5 | $ | 371 | $ | 418 | $ | (47) | -11% |
Third Quarter 2025 2024 Change % Change
Total revenue per unit | $ | 1,721 | $ | 1,694 | $ | 27 | 2% |
Less: Fuel surcharge revenue per unit | 116 | 132 | (16) | -12% | |||
Revenue per unit less fuel surcharge revenue6 | $ | 1,605 | $ | 1,562 | $ | 43 | 3% |
Merchandise revenue per unit | $ | 3,310 | $ | 3,299 | $ | 11 | 0% |
Less: Fuel surcharge revenue per unit | 121 | 153 | (32) | -21% | |||
Merchandise revenue per unit less fuel surcharge revenue6 | $ | 3,189 | $ | 3,146 | 43 | 1% |
Intermodal revenue per unit | $ | 735 | $ | 726 | $ | 9 | 1% |
Less: Fuel surcharge revenue per unit | 127 | 136 | (9) | -7% | |||
Intermodal revenue per unit less fuel surcharge revenue6 | $ | 608 | $ | 590 | $ | 18 | 3% |
Coal revenue per unit | $ | 2,120 | $ | 2,306 | $ | (186) | -8% |
Less: Fuel surcharge revenue per unit | 24 | 46 | (22) | -48% | |||
Coal revenue per unit less fuel surcharge revenue6 | $ | 2,096 | $ | 2,260 | $ | (164) | -7% |
1GAAP financial results are adjusted to exclude the effects of the February 3, 2023 derailment in Eastern Ohio (the Incident). During the third quarter of 2025, the overall expense impact on operating expenses resulting from costs and recoveries associated with the Incident was $13 million. During the third quarter of 2024 and the second quarter of 2025, the Company recorded net recoveries that exceeded Incident-related expenses of $159 million and $47 million, respectively. The income tax effects of this non-GAAP adjustment were calculated based on the applicable tax rates to which the non-GAAP adjustment related. Management believes these non-GAAP financial measures provide valuable information regarding earnings and business trends of the Company. We use these non-GAAP financial measures internally and believe this information provides useful supplemental information to investors to facilitate making period-to-period comparisons and assessing trends in our performance by excluding the effects of the Incident.
2GAAP financial results are adjusted to exclude the effects of restructuring and other charges. During the third and second quarters of 2025, the Company recorded $12 million and $10 million, respectively, of restructuring and other charges related to the restructuring of certain technology functions. In the third quarter of 2024, the Company recorded $60 million associated with the rationalization of certain software development projects that had not been placed in service and reflecting certain equipment at its net realizable value in advance of the planned disposition of that asset class. The income tax effects of this non-GAAP adjustment were calculated based on the applicable tax rates to which the non-GAAP adjustment related. Management believes these non-GAAP financial measures provide valuable information regarding earnings and business trends of the Company. We use these non-GAAP financial measures internally and believe this information provides useful supplemental information to investors to facilitate making period-to-period comparisons and assessing trends in our performance by excluding by excluding these costs.
3GAAP financial results are adjusted to exclude the effects of merger-related expenses. During the third quarter of 2025, we incurred $15 million in merger-related expenses primarily related to third-party advisor fees, legal fees, and costs associated with employee retention agreements. The income tax effects of this non-GAAP adjustment were calculated based on the applicable tax rates to which the non-GAAP adjustment related. Management believes these non-GAAP financial measures provide valuable information regarding earnings and business trends of the Company. We use these non-GAAP financial measures internally and believe this information provides useful supplemental information to investors to facilitate making period-to-period comparisons and assessing trends in our performance by excluding by excluding these costs.
4GAAP financial results are adjusted to exclude gains on railway line sales. During the third quarter of 2024, the Company completed sales of two railway lines in the states of Virginia and North Carolina resulting in gains of $380 million. The income tax effects of this non-GAAP adjustment were calculated based on the applicable tax rates to which the non-GAAP adjustment related. Management believes these non-GAAP financial measures provide valuable information regarding earnings and business trends of the Company. We use these non-GAAP financial measures internally and believe this information provides useful supplemental information to investors to facilitate making period-to-period comparisons and assessing trends in our performance by excluding by excluding these gains.
5Revenue less fuel surcharge revenue as used here is to reflect revenue absent the effect of fuel surcharges. Management believes this non-GAAP financial measure provides useful supplemental information to investors regarding the Company's revenue trends, by excluding the volatility introduced by fuel surcharges, and is useful for period-over-period comparisons of these trends.
6Revenue per unit as used here is to reflect average revenue per unit absent the effect of fuel surcharges. Management believes this non-GAAP financial measure provides useful supplemental information to investors regarding the Company's pricing trends, by excluding the volatility introduced by fuel surcharges, and is useful for period-over-period comparisons of these trends.
The Company uses these non-GAAP financial measures internally and believes this information provides useful supplemental information to investors regarding the Company's financial performance as compared to prior periods. While the Company believes that these non-GAAP financial measures are useful in evaluating the Company's business, this information should be considered as supplemental in nature and is not meant to be considered in isolation from, or as a substitute for, the related financial information prepared in accordance with GAAP. In addition, these non-GAAP financial measures may not be the same as similar measures presented by other companies.
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NS - Norfolk Southern Corporation published this content on October 23, 2025, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on October 23, 2025 at 20:12 UTC.
