Railroad operator Norfolk Southern Corp. (NSC), Tuesday reported a plunge in second-quarter profit, reflecting declining traffic volumes and low fuel-related revenues in the midst of recession in the U.S. Earnings, though declined from last year, came in ahead of analysts' consensus by two cents, while revenues fell short of expectations.
Wick Moorman, CEO, Norfolk Southern said, "Second-quarter results obviously reflect the impact of the recession. However, the measures we are taking to control expenses while maintaining our industry-leading service levels have enabled us to post solid second-quarter results, while at the same time we continue to invest in projects that position us for the eventual economic recovery."
The Norfolk, Virginia-based company's net income for the second quarter dropped sharply to $247.00 million or $0.66 per share from $453.00 million or $1.18 per share for the year-ago quarter.
The results for the second quarter includes a $21 million favorable adjustment related to settlement of a multi-year state tax dispute.
On average, 17 analysts polled by Thomson Reuters expected the company to earn $0.64 per share for the second quarter. Analysts' estimates typically exclude one-time charges and gains.
In the first quarter, Norfolk had reported a net income of $177.00 million or $0.47 per share, down 39% from $291.00 million or $0.76 per share in the prior year quarter.
Railway operating revenues for the second quarter under review dropped 33% to $1.90 billion from $2.77 billion in the same quarter last year, mainly due to a 26% reduction in traffic volume and lower fuel-related revenues. Nine analysts had a consensus revenue estimate of $2.05 billion for the second quarter.
For the sequentially preceding quarter, railway operating revenues dropped 22% to $1.94 billion from $2.50 billion in the same quarter last year.
General merchandise revenues for the second quarter decreased 33% year-over-year to $978.00 million, while coal revenues declined 34% to $511 million from last year. Intermodal revenues for the quarter dropped 31% to $368 million from the year-ago quarter.
Railway operating expenses for the quarter decreased 29% to $1.4 billion from $2.00 billion a year ago. Railway operating ratio for the quarter was 74.8%, compared with 71.1% during the prior-year quarter.
Amongst others in the sector, Jacksonville, Florida-based CSX Corp. (CSX), on July 13, said its second quarter profit declined from last year, hurt by lower volume as well as lower fuel surcharge recovery, amid a broad-based weakness in the economy. The company reported net earnings of $308 million or $0.78 per share for the second quarter, down from $385 million or $0.93 per share in the prior year quarter. Second quarter revenues declined 25% to $2.20 billion from $2.91 billion in the same quarter last year, due to a 21% decline in volume and lower fuel surcharge recovery.
For the six-month period, Norfolk's net income decreased to $424.00 million or $1.13 per share from $744.00 million or $1.94 per share in the same period last year. Railway operating revenues for six months dropped to $3.80 billion from $5.30 billion last year.
NSC closed Tuesday's regular trading at $43.63, down $1.49 or 3.30%, on a volume of 5.53 million shares on the NYSE. In after hours, the stock further lost $0.40 or 0.92%, trading at $43.23. In the past 52 weeks, the stock trended in a broad range of $26.69 - $75.53, with a three-month average volume of 5.53 million shares.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.