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BNSF’s Q3 net income grows 14% on higher revenue

Revenue increases 12%, to $5.8 billion

A BNSF train heads to its next destination. (Photo: Jim Allen/FreightWaves)

Higher revenues helped BNSF’s third-quarter net profit rise by 14%, to $1.5 billion, the western U.S. railroad reported Monday.

In contrast, BNSF’s net income in the third quarter of 2020 was $1.3 billion. The railroad is owned by Berkshire Hathaway (NYSE: BRK.B), which filed its quarterly results with the U.S. Securities and Exchange Commission on Monday. 

Total revenues were $5.8 billion in the third quarter, a 12% increase from nearly $5.2 billion year-over-year. The average revenue per car/unit rose 5%, to $2,128 from $2,021 a year ago.

Operating ratio (OR) was 59.5%, a slight improvement from 59.7% in the third quarter of 2020. Investors sometimes use OR to gauge the financial health of a company, with a lower OR implying improved health.

Volumes rose by 4% in the third quarter to 2.5 million units, with a 3% increase in consumer products volumes as higher retail sales drove growth for intermodal; a 14% increase in industrial products volumes due to improvements in the U.S. industrial economy and higher volumes for the construction and building sectors; and 12% growth in coal volumes amid increased electricity generation, higher natural gas prices and improved export demand, BNSF said.

Third-quarter volume gains were offset by a 10% decline in agricultural products volumes because of lower grain exports, while lower petroleum volumes offset gains for industrial products volumes.

“Higher rates per car/unit and increased fuel surcharges principally from higher fuel prices were offset by business mix changes,” BNSF said of volumes and revenues for the first three quarters of 2021. “Revenue changes were driven by continued improvements from the 2020 effects of the COVID-19 pandemic, partially offset by the ongoing disruptions in the global supply chain.”


Meanwhile, total operating expenses rose 11%, to $3.5 billion, as higher fuel prices and a 79% increase in fuel expenses offset productivity improvements.

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Joanna Marsh

Joanna is a Washington, DC-based writer covering the freight railroad industry. She has worked for Argus Media as a contributing reporter for Argus Rail Business and as a market reporter for Argus Coal Daily.