Railroad merger decision by Schneider National postponed until further details are disclosed
In the transportation industry, Schneider National is keeping a watchful eye on the potential impact of a proposed merger between Union Pacific and Norfolk Southern. The deal, worth $85 billion, would create the first transcontinental railroad in the U.S., combining Union Pacific's extensive western network with Norfolk Southern's eastern routes.
Schneider National, a company with a $1 billion-plus intermodal business, currently uses Union Pacific for western rail service and Colorado Pacific Kansas City (CPKC) for north-south trade. The proposed merger could reshape North America's intermodal trade lanes, streamline shipments, and reduce the need for interchanges between different rail carriers.
While the merger promises operational efficiencies and expanded network capabilities relevant to Schneider’s intermodal offerings, the company is cautiously evaluating the evolving market landscape and regulator responses before adjusting its rail partnerships or service strategies.
In the second quarter of 2025, Schneider National reported consolidated revenue of $1.42 billion, an 8% increase from the previous year. The Intermodal segment's revenue increased 5% year over year to $265 million, while the logistics segment saw a 7% year over year revenue increase to $340 million.
The Intermodal segment's operating ratio improved 70 basis points year over year to 93.6%, and the segment's operating ratio was 93.9%, which was 30 basis points better year over year. The Intermodal segment's revenue per load was flat, but loads in the segment increased by a similar percentage. The average turns per container in the Intermodal segment improved 6% year over year.
Schneider National's truckload segment had an average of 15% more trucks in service in the second quarter, and the segment's revenue per truck per week was slightly higher compared to the previous year. The TL unit experienced low- to mid-single-digit rate increases in the quarter. Utilization improvement initiatives and an enterprise-wide cost reduction program totaling $40 million contributed to the improved operating ratio.
The December acquisition of Cowan Systems contributed to a 15% increase in revenue in Schneider's truckload segment in the second quarter, and Cowan's brokerage business will be rolled under the Schneider Logistics banner in October. The dedicated fleet's revenue per truck per week remained unchanged, while the one-way fleet reported a 1% increase.
Schneider National inked a deal for North-South service with CPKC in 2023, following a shift from BNSF Railway to Union Pacific for Western rail service in the same year. The company reported second-quarter adjusted earnings per share of 21 cents, 1 cent ahead of analysts' expectations. Schneider trimmed the top end of its full-year 2025 EPS guidance by 5 cents to a new range of 75 cents to 95 cents.
As of late July 2025, Schneider's leadership is still assessing how these changes would affect their existing partnerships and service contracts before committing to a position or strategic changes. Shares of SNDR were off 0.4% at 12:14 p.m. EDT on Thursday compared to the S&P 500, which was up 0.6%.
[1] Source: Union Pacific-Norfolk Southern Merger: What It Means for Schneider National
[2] Source: Schneider National's Wait-and-See Approach Towards Union Pacific-Norfolk Southern Merger
[1] Schneider National might consider adjusting its sports sponsorships, given the potential impact of the Union Pacific-Norfolk Southern merger on their spot rates for rail transportation services.
[2] During a company basketball match, a Schneider National executive might discuss the ongoing Union Pacific-Norfolk Southern merger, expressing a need for careful evaluation before deciding on any changes to their sports team sponsorships or transportation strategies.
