BNSF third-quarter earnings rise 19.3% to $1.73 billion

By Priya Raman

BNSF Railway reported third-quarter net earnings, meaning profit after interest and tax, of $1.73 billion, up 19.3% from $1.45 billion a year earlier, for the period ended Sept. 30. The increase came as freight traffic rose 3.9% and operating efficiencies helped offset higher fuel costs.

Parent Berkshire Hathaway (NYSE: BRK-B) said railroad operating revenue climbed 14.7% to $6.87 billion in the quarter. Car and unit volumes, a traffic measure based on railcars and other billing units, rose 3.9%, less quickly than revenue. Revenue growth therefore came from additional traffic and higher revenue per unit on average.

What drove the earnings increase?

Railroad operating earnings, the operating profit measure before interest and tax, increased to $2.48 billion from $2.15 billion. Operating expenses rose to $4.39 billion from $3.84 billion, but remained below the dollar increase in operating revenue.

After interest expense and other net revenue and expense items, pretax earnings reached $2.27 billion, compared with $1.91 billion. Interest expense declined to $273 million from $279 million, a modest financing benefit alongside the operating improvement.

Berkshire also recorded a lower effective income tax rate of 23.7%, down from 24.2%. Income tax expense nevertheless increased to $537 million from $463 million because pretax profit grew.

These are measured results, not projections. The source provides no earnings or traffic forecast and identifies no specific efficiency program; it supports a narrower conclusion that BNSF earned more while absorbing higher fuel costs. It does not quantify how much of the improvement will recur.

What happened to coal?

Third-quarter coal shipments fell 8.4%, yet coal operating revenue edged up to approximately $800 million. Berkshire said higher average revenue per car or unit, reflecting increased fuel-surcharge revenue and yield, more than offset the lower traffic. Fuel surcharge means the rate adjustment tied to fuel prices; yield means revenue per unit of traffic.

Over the first nine months, coal volumes fell 6.3%, while coal operating revenue edged higher to approximately $2.3 billion. The pattern was not a coal expansion: BNSF moved fewer coal units but collected more revenue per unit.

The broader nine-month results extended the year's earnings growth. Net earnings reached $4.66 billion, 13% above the $4.13 billion recorded in the first nine months of 2025. Berkshire again attributed the improvement to higher freight volumes and operating efficiencies, partly offset by rising fuel expenses.

Railroad operating revenue for those nine months increased 11.5% to $19.39 billion, compared with a 4.2% rise in car and unit volumes. Railroad operating earnings reached $6.80 billion, up from $5.98 billion a year earlier. Revenue therefore grew substantially faster than measured traffic across the nine-month period.

What does this change for shippers?

For shippers, the immediate change is higher revenue per unit in coal, not more coal traffic. Across the railroad, revenue growth also outpaced volume growth by a wide margin. The release identifies fuel-surcharge revenue and yield specifically for coal, but provides no equivalent commodity breakdown for the rest of the railroad.

It also supplies no fleet plans or network-performance data against which to test Berkshire's operating-efficiency claim. Such evidence would be needed to connect the reported cost performance to locomotive availability, train capacity or service reliability. Without it, efficiency remains an attribution; the measured outcomes are higher earnings and revenue growth above volume growth.

Berkshire's total operating earnings declined to $12.71 billion from $13.49 billion in the year-earlier quarter. BNSF contributed $1.73 billion, against $1.45 billion, so the railroad supplied a larger contribution even as the parent's overall operating result weakened.

That context explains why the 19.3% increase at BNSF did not translate into equivalent group growth. The $1.73 billion figure represents BNSF's net earnings contribution; the separate $2.48 billion measure is railroad operating earnings before the interest, other net items and tax effects listed above.

No separate commodity figures were given for agricultural, automotive or intermodal traffic, and the source offered no detailed management commentary. Shippers therefore have evidence of a system-wide volume increase and strong revenue performance, but not a commodity-by-commodity explanation of the 3.9% quarterly and 4.2% nine-month traffic gains.

The next reporting period will show whether BNSF can sustain revenue growth above volume growth while absorbing fuel costs and coal's volume contraction. Until then, the disclosed figures establish stronger earnings and a larger contribution to Berkshire, not a forecast of traffic, capacity or service.