Norfolk Southern's quarterly profits were again inflated by insurance payments related to its disastrous 2023 derailment in eastern Ohio, but even without that, the railroad's profits still grew.
The Atlanta-based railroad reported a major rebound in its results Wednesday with $750 million profit, or $3.31 per share, in the first quarter. Last year, the first quarter results of $53 million, or 23 cents per share, were held down by the $600 million class action settlement the railroad agreed to pay residents near the East Palestine derailment.
Since last year's second quarter, Norfolk Southern has been consistently collecting more in insurance payments than it was spending on the derailment cleanup and response, so its bottom line has received a boost each of the last several quarters. In the first quarter, the insurance payments boosted the railroad's net income by $141 million. Without that, it would have earned $609 million, or $2.69 per share, compared to $2.49 per share last year.
Wall Street analysts focus on ongoing operations, which strips out the insurance windfall, and by that measure the railroad beat the average estimate reported by FactSet Research by 3 cents per share.
The railroad has received close to $1 billion in insurance payments to date to help cover the roughly $2 billion it has spent since the East Palestine derailment. Chief Financial Officer Jason Zampi said he expects less than $100 million in remaining insurance payments to come in.
The railroad's revenue was essentially flat at just under $3 billion, but it was able to continue cutting expenses as part of its larger effort to get more efficient even as it dealt with roughly $35 million of winter storm related costs.
Norfolk Southern CEO Mark George said the railroad overcame disruptive winter weather during the first three months of the year to improve service and efficiency. The railroad also delivered about 1% more shipments in the quarter because consistent service is helping it win new business. Norfolk Southern's main competitor in the East, CSX railroad, posted a 1% decline in volume during the quarter as two major construction projects and the storms disrupted its network, so it appears that some shipments shifted between the two railroads.
“Our service performance is increasing our customers’ confidence in Norfolk Southern and allowing us to gain share,” George said in a statement.
He still predicts that Norfolk Southern will generate another $150 million of productivity improvements this year while seeing revenue grow roughly 3% although the overall economy could derail that if it takes a downturn after President Donald Trump's tariffs all take effect.
George said the railroad is hearing fears about the possibility for a recession later this year so Norfolk Southern is keeping a close eye on volume, but companies haven't started to cut shipments yet.
“There’s no way to predict where we go right now. We’re in a really uncertain spot,” George said. “But we haven’t seen negative trends yet that really alarm us.”
Edward Jones analyst Jeff Windau said the economic environment and Trump's trade policy seem to almost be changing daily, so that makes it hard for businesses to plan.
“The rails are going to be impacted by the overall economy. But they’re still seeing some good opportunities. And they’re still able to deliver on their expectations,” Windau said. “So far things seem to be going OK yet this year.”
The Atlanta-based railroad is one of the biggest in the nation with tracks throughout the Eastern United States.
A year ago, Norfolk Southern was also in the midst of a fight with an outside investor that wanted to fire management and overhaul the railroad's operations. That investor, Ancora Holdings, won three board seats, and Norfolk Southern later changed CEOs after the board learned that former CEO Alan Shaw had an inappropriate relationship with a subordinate.
Shares of the company rose about 3% in early trading before settling back down a bit. The stock was trading up about 1.6% at $223.47 around midday.
FILE - A Norfolk Southern freight train passes through Homestead, Pa., Wednesday, March 12, 2025. (AP Photo/Gene J. Puskar, File)
ROME (AP) — Jannik Sinner has gone all the way to the final in his first tournament back from a three-month doping ban.
And Carlos Alcaraz is waiting for him in the Italian Open title match.
The top-ranked Sinner rallied past No. 12 Tommy Paul 1-6, 6-0, 6-3 in the semifinals on Friday as he attempts to become the first Italian man to lift the Rome trophy since Adriano Panatta in 1976.
Earlier, Alcaraz advanced to his first Rome final by beating Lorenzo Musetti 6-3, 7-6 (4).
Sunday’s final will mark the first meeting between Sinner and Alcaraz since October, when Alcaraz won the China Open final in a third-set tiebreaker. Alcaraz holds a 6-4 edge in his career meetings with Sinner and has won three straight against his biggest rival.
But Sinner has not lost since that defeat to Alcaraz in Beijing and is on a 26-match winning streak. He’s playing his first tournament since he won his third Grand Slam title at the Australian Open in January.
“He’s playing great. I’ve been watching his matches,” Alcaraz said. “His level is really high right now. Every time that I play against him is always a battle, always really, really tough. I kind of enjoy (those) moments.”
Sinner cranked up his level to near perfection in a rout of Casper Ruud in the quarterfinals on Thursday. Against Paul, Sinner made unforced errors in the first set while his American opponent hit shot after shot on the lines. But Sinner quickly turned the match around.
Sinner said cooler, heavier conditions made it more challenging and that getting broken in his first service game was a “punch in my face."
“But I tried to stay there mentally, trying to understand what might work a little bit better,” Sinner said. “Tennis can change quickly.”
Toward the end of the match, Sinner appeared to be grimacing at times and clutching his thighs.
“Since the third round I have a small blister under my feet which doesn’t allow me that well to move in some moments,” he said. “Leg-wise I’m not concerned, it’s just a bit tight.
“There are no excuses. With the adrenaline there is just going to be a lot of energy on Sunday. I’m 100% not concerned.”
Sinner is the first Italian man in the Rome final since Panatta lost the 1978 title match to Bjorn Borg, and Alcaraz noted that playing Sinner before his home crowd will be “even more challenging.”
Sinner's fans have been out in full force for all of his matches, many of them wearing wigs and hats in orange — his theme color. One fan held aloft a sign during the semifinal that translated from Italian to, “Sinner, we missed you.”
In February, Sinner agreed to a settlement with the World Anti-Doping Agency that raised questions, since the three-month suspension conveniently allowed him not to miss any Grand Slams and come back at his home tournament.
Rome is the last big warmup before the French Open starts on May 25.
It’s the third final in three clay-court events this season for Alcaraz, who won the Monte Carlo Masters and finished runner-up in the Barcelona Open. He withdrew from the Madrid Open because of injury.
The third-ranked Alcaraz withdrew from the Madrid tournament with an upper right leg issue and also had a left leg injury. In Rome, he has been wearing a long black brace covering the upper portion of his right leg stretching down to just below his knee.
Musetti took the first set off Alcaraz in the Monte Carlo final but Alcaraz broke the Italian’s serve in the first game of the rematch to silence the pro-Musetti crowd on Campo Centrale. Musetti didn’t help himself with unforced errors and began pushing Alcaraz only at the end of the set.
Musetti was docked a point for misbehavior late in the second set after receiving a warning earlier for breaking his racket.
On a windy day at the Foro Italico, Alcaraz said it wasn’t about playing “brilliant,” but rather “smart tennis” was required.
“Waiting for your chances to play aggressive, so I think I did it pretty well,” Alcaraz said. “I stayed strong mentally when things didn’t went to my side.”
Alcaraz is playing the Italian Open for the second time. During his Rome debut last year, he lost to then-135th-ranked Hungarian qualifier Fabian Marozsan in the third round.
The women’s final on Saturday features Coco Gauff against Jasmine Paolini.
Paolini and partner Sara Errani also advanced to the women’s doubles final when they beat Russian pair Mirra Andreeva and Diana Shnaider 6-4, 6-4 in a rematch of last year’s Olympic final also won by the Italians.
AP tennis: https://apnews.com/hub/tennis
Italy's Jannik Sinner celebrates after winning the semifinal tennis match against Tommy Paul, of the United States, at the Italian Open, in Rome, Friday, May 16, 2025. (AP Photo/Andrew Medichini)
Jannik Sinner fans wait for the start of the semifinal tennis match against Tommy Paul, of the United States, at the Italian Open, in Rome, Friday, May 16, 2025. (AP Photo/Andrew Medichini)
Italy's Jannik Sinner stands on the court during his semifinal tennis match against Tommy Paul, of the United States, at the Italian Open, in Rome, Friday, May 16, 2025. (AP Photo/Andrew Medichini)
Spain's Carlos Alcaraz celebrates after winning the semifinal tennis match against taly's Lorenzo Musetti at the Italian Open, in Rome, Friday, May 16, 2025. (AP Photo/Andrew Medichini)
Spain's Carlos Alcaraz returns the ball to Italy's Lorenzo Musetti during their semifinal tennis match at the Italian Open, at the Foro Italico, in Rome, Friday, May 16, 2025. (AP Photo/Andrew Medichini)
Italy's Lorenzo Musetti returns the ball to Spain's Carlos Alcaraz during their semifinal tennis match at the Italian Open, in Rome, Friday, May 16, 2025. (AP Photo/Andrew Medichini)
Spain's Carlos Alcaraz walks on the court during the semifinal tennis match against Italy's Lorenzo Musetti at the Italian Open, in Rome, Friday, May 16, 2025. (AP Photo/Andrew Medichini)
Italy's Lorenzo Musetti returns the ball to Spain's Carlos Alcaraz during their semifinal tennis match at the Italian Open, at the Foro Italico, in Rome, Friday, May 16, 2025. (AP Photo/Andrew Medichini)
Spain's Carlos Alcaraz returns the ball to Italy's Lorenzo Musetti during their semifinal tennis match at the Italian Open, in Rome, Friday, May 16, 2025. (AP Photo/Andrew Medichini)
Spain's Carlos Alcaraz returns the ball to Italy's Lorenzo Musetti during their semifinal tennis match at the Italian Open, at the Foro Italico, in Rome, Friday, May 16, 2025. (AP Photo/Andrew Medichini)
