ATLANTA — Atlanta-based railroad company Norfolk Southern reported profits were down more than a quarter for the start of 2026.
According to the company’s latest earnings report, the first quarter of 2026 saw a 27% decrease in profits due to adjustments related to the East Palestine derailment in 2023 in Ohio.
The Associated Press reported this was due to Norfolk Southern not collecting insurance payments from the derailment this quarter.
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Expenses related to Norfolk Southern’s planned merger with Union Pacific also contributed to decreases in profit, the company said.
In a statement with the earnings report, Mark Georgia, Norfolk Southern president and CEO, said conditions for the company were getting better.
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“In the first quarter, our team stayed focused on what we could control, operating with discipline amid volatile volumes, severe winter weather, and a rapidly shifting macroeconomic environment including the dramatic rise in fuel prices in March,” George said. “Despite these challenges, our employees safely delivered a solid service product, managed costs effectively, and earned the continued trust of our customers. As conditions improved, we captured momentum exiting the quarter, reinforcing the strength of our operating foundation and the dedication of the entire Norfolk Southern team.”
The company reported revenue from railway operations were flat, or mainly unchanged, though they reported a $5 million increase in revenue, staying near the $3 billion it took in last year.
The revenue level from railway operations was down 23% compared to the same period in 2025, at $877 million versus 2025’s roughly $1.15 billion.
Norfolk Southern’s income from railway operations was down 2%, at $939 million compared to 2025’s $961 million during the same period.
All of the different adjustments and fluctuations led to diluted earnings per share going down $0.88, or 27%, the company said.
Compared to 2025, Norfolk Southern said it was a 1% difference due to adjustments for Eastern Ohio derailment impacts and merger-related expenses, which brought diluted earnings per share down by four cents.
The merger effort between Norfolk Southern and Union Pacific hit a stumbling block with the U.S. Surface Transportation Board in the most recent attempt.
TSB asked for more information from the companies about the merger and the companies are expected to resubmit their request with new information on Thursday.
Officials on the board are still weighing if the deal would enhance competition by reducing the number of major railroads from six to five.
If the merger is approved, it would be wroth about $85 billion and create the first transcontinental railroad in the United States.
The Associated Press contributed to this report.
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