10-Q · July 23, 2026
Norfolk Southern delivered record Q2 revenue of $3.465 billion, up 11% year over year, driven by 4% volume growth, higher pricing and a $212 million increase in fuel-surcharge revenue. However, GAAP operating income…
Earnings analysis · 10-Q
NSC earnings analysis
Filed October 22, 2026 · Our reading of the company's report
The latest report
Norfolk Southern delivered strong third-quarter revenue of approximately $3.5 billion, up 14% year over year and above the $3.475 billion consensus estimate. However, diluted EPS of $3.37 missed the $3.47 estimate,…
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Norfolk Southern delivered strong third-quarter revenue of approximately $3.5 billion, up 14% year over year and above the $3.475 billion consensus estimate. However, diluted EPS of $3.37 missed the $3.47 estimate, while the 67.4% operating ratio implied a 32.6% operating margin, below the 35.4% year-ago level. The 10-Q provides no quantitative forward guidance and states that the risk factors from the 2025 Form 10-K remain unchanged; merger-related restrictions also keep the $6.3 billion of remaining repurchase authorization unused.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $3.37
- Operating margin
- 32.6%
What stood out
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Record revenue exceeded estimates
Third-quarter revenue was approximately $3.5 billion, up 14% year over year and above the $3.475 billion consensus estimate. Revenue also increased from $3.46 billion in the prior quarter.
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EPS grew but missed consensus
Diluted EPS was $3.37, an increase from $3.16 in the year-ago quarter but below the $3.47 consensus estimate.
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Operating margin deteriorated
Operating efficiency weakened: the operating ratio was 67.4%, implying a 32.6% operating margin, versus a 35.4% operating margin in the year-ago quarter.
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Volume and surcharges lifted revenue
Volume growth and fuel surcharges supported the 14% year-over-year revenue increase, according to the earnings-period disclosures.
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Repurchase capacity remains unused
The company had $6.3 billion remaining under its $10.0 billion share-repurchase authorization as of September 30, 2026, although repurchases were suspended under the Union Pacific merger agreement.
What to watch
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Merger restrictions limit capital returns
The 10-Q states that the risks in the 2025 Form 10-K remain unchanged, providing no indication that previously disclosed operating, regulatory, merger, or incident risks have eased. The filing specifically notes that $6.3 billion remained authorized for repurchases as of September 30, 2026, but the merger agreement restricts repurchases without Union Pacific's consent.
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Cost pressure offset revenue growth
Operating efficiency remains a material headwind: the 67.4% operating ratio corresponds to a 32.6% operating margin, down from 35.4% a year earlier, despite revenue growth of 14%.
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Earnings conversion was below expectations
Quarterly EPS of $3.37 was $0.10 below the $3.47 consensus estimate, indicating that the strong revenue result did not fully translate into earnings.
Management's outlook
The 10-Q provides no quantitative revenue or EPS guidance. Management's risk disclosures state that the risks in the 2025 Form 10-K remain unchanged.
Earlier filings 2
10-Q · April 24, 2026
Norfolk Southern reported first-quarter 2026 railway operating revenues of $2,998 million (up $5 million vs. Q1 2025) and GAAP diluted EPS of $2.43, down 27% year-over-year. Results were pressured by higher railway…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.