Norfolk Southern Registers 16% Top-Line Growth In Q2

Norfolk Southern Corp NSC reported second-quarter FY22 railway operating revenue growth of 16% year-over-year to $3.25 billion, beating the consensus of $3.13 billion.
EPS improved to $3.45 from $3.28 in 2Q21, below the consensus of $3.47.
Revenue was driven by a 20% increase in revenue per unit.
Sales by segments: Merchandise $1.85 billion (+10% Y/Y), Intermodal $972 million (+21% Y/Y) and Coal $425 million (+34% Y/Y).
Railway operating expenses increased by 21% Y/Y to $2 billion due to higher fuel prices, lower property sales, and increased costs from inflation and service challenges.
Income from railway operations increased by 9% Y/Y to $1.27 billion, and the margin contracted 260 basis points to 39.1%.
The railway operating ratio was 60.9%, compared to 58.3% in 2Q21.
Norfolk Southern generated operating cash flow year-to-date of $2.01 billion, compared to $2.1 billion a year ago.
FY22 Outlook: Norfolk Southern expects revenue to grow by ~12% Y/Y and 50-100 bps improvement in operating ratio.
Price Action: NSC shares are trading lower by 0.50% at $243.39 on the last check Wednesday.