Union Pacific (UNP) 8-K Union Pacific Reports Record Quarter

Exhibit 99.1

UNION PACIFIC REPORTS RECORD QUARTER

Establishes New “Bests” for Operating Income and Operating Ratio

FOR IMMEDIATE RELEASE

All-Time Quarterly Records

• Diluted earnings per share improved 54 percent to $1.56.

• Operating income totaled $1.4 billion, up 46 percent.

• Net income increased 51 percent to $778 million.

• Operating ratio was 68.2 percent, 5.6 points better than third quarter 2009 and 1.2 points better than the previous record set in the second quarter 2010.

• Customer Satisfaction Index of 90, up 2 points.

Omaha, Neb., October 21, 2010– Union Pacific Corporation (NYSE: UNP) today reported 2010 third quarter net income of $778 million, or $1.56 per diluted share, compared to $514 million, or $1.01 per diluted share, in the third quarter 2009. Third quarter Operating Revenue grew 20 percent to $4.4 billion versus $3.7 billion in the third quarter 2009.

“Strong volume growth, pricing gains and operating efficiency combined to produce another record quarter for our Company,” said Jim Young, Union Pacific chairman and chief executive officer. “New ‘bests’ in both Customer Satisfaction and Operating Ratio demonstrate the solid performance of our operations. As business levels increase on our railroad, we are leveraging our capital investments, delivering on customer commitments and realizing the potential of the UP franchise.”

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Third Quarter Summary

Third quarter business volumes, as measured by total revenue carloads, grew 14 percent versus 2009’s recession-affected levels as all six Union Pacific business groups reported volume growth. Quarterly operating revenue increased 20 percent in the third quarter 2010 to $4.4 billion versus $3.7 billion in the third quarter 2009. In addition:

• All six business groups reported freight revenue growth in the quarter, up 21 percent versus third quarter 2009 to a total of $4.2 billion. Double-digit volume growth, increased fuel cost recoveries and core pricing gains all contributed to the increase.

• Quarterly diesel fuel prices increased 20 percent from an average of $1.87 per gallon in the third quarter 2009 to an average of $2.24 per gallon in the third quarter 2010.

• Union Pacific’s operating ratio was a best-ever 68.2 percent, 5.6 points of improvement versus 2009. Strong volume growth, ongoing efficiency initiatives and quarterly pricing gains drove this record performance.

• A Customer Satisfaction Index of 90 was a quarterly best and 2 points better than the third quarter 2009.

• Quarterly train speed, as reported to the Association of American Railroads, was 25.7 mph, down 6 percent versus record velocity in the third quarter 2009, reflecting the effects of Hurricane Alex and subsequent flooding in Mexico, which closed the Laredo gateway for nearly the entire month of July.

• The Company repurchased more than 7.6 million shares in the third quarter 2010 at an average share price of $73.19, and an aggregate cost of approximately $560 million.

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Summary of Third Quarter Freight Revenues

• Automotive up 36 percent.

• Intermodal up 34 percent.

• Industrial Products up 25 percent.

• Agricultural up 16 percent.

• Chemicals up 14 percent.

• Energy up 11 percent.

Outlook

“As the economy continues to recover, we stand ready to safely and reliably haul more freight,” Young said. “Longer term, we believe Union Pacific is positioned to provide strong value for our customers and shareholders, as the long-standing need for freight rail transportation in our nation provides us with a stable foundation as well as a platform for future growth.”

About Union Pacific

Union Pacific Corporation owns one of America’s leadingtransportation companies. Its principal operating company, Union Pacific Railroad, links 23 states in the western two-thirds of the country. Union Pacific serves many of the fastest-growing U.S. population centers and provides Americans with a fuel-efficient,environmentally responsible and safe mode of freight transportation. Union Pacific’s diversified business mix includes Agricultural Products, Automotive, Chemicals, Energy, Industrial Products and Intermodal. The railroad emphasizes excellent customer service and offers competitive routes from all major West Coast and Gulf Coast ports to eastern gateways. Union Pacific connects with Canada’s rail systems and is the only railroad serving all six major gateways to Mexico, making it North America’s premier rail franchise.

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Supplemental financial information is attached.

Investor contact is Jennifer Hamann, (402) 544-4227.

Media contact is Donna Kush, (402) 544-3753.

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This press release and related materials contain statements about the Corporation’s future that are not statements of historical fact, including specifically the statements under the caption “Outlook” in this press release, which include statements regarding the Corporation’s expectations with respect to economic conditions; operating performance; future revenue growth; delivering value to its customers and shareholders; and moving customer traffic safely, and reliably. These statements are, or will be, forward-looking statements as defined by the Securities Act of 1933 and the Securities Exchange Act of 1934. Forward-looking statements also generally include, without limitation, information or statements regarding: projections, predictions, expectations, estimates or forecasts as to the Corporation’s and its subsidiaries’ business, financial, and operational results, and future economic performance; and management’s beliefs, expectations, goals, and objectives and other similar expressions concerning matters that are not historical facts.

Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times that, or by which, such performance or results will be achieved. Forward-looking information, including expectations regarding operational and financial improvements and the Corporation’s future performance or results are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in the statement. Important factors, including risk factors, could affect the Corporation’s and its subsidiaries’ future results and could cause those results or other outcomes to differ materially from those expressed or implied in the forward-looking statements. Information regarding risk factors and other cautionary information are available in the Corporation’s Annual Report on Form 10-K for 2009, which was filed with the SEC on February 5, 2010. The Corporation updates information regarding risk factors if circumstances require such updates in its periodic reports on Form 10-Q and its subsequent Annual Reports on Form 10-K (or such other reports that may be filed with the SEC).

Forward-looking statements speak only as of, and are based only upon information available on, the date the statements were made. The Corporation assumes no obligation to update forward-looking information to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information. If the Corporation does update one or more forward-looking statements, no inference should be drawn that the Corporation will make additional updates with respect thereto or with respect to other forward-looking statements. References to our website are provided for convenience and, therefore, information on or available through the website is not, and should not be deemed to be, incorporated by reference herein.

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UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES

Condensed Consolidated Statements of Income (unaudited)

Millions, Except Per Share Amounts,	3rd Quarter									Year-to-Date
For the Periods Ended September 30,	2010			2009			%			2010			2009			%
	(Adjusted)*									(Adjusted)*
Operating Revenues
Freight revenues	$	4,187		$	3,471			21	%	$	11,898		$	9,832			21	%
Other revenues		221			200			11			657			557			18
Total operating revenues		4,408			3,671			20			12,555			10,389			21
Operating Expenses
Compensation and benefits		1,092			999			9			3,202			3,045			5
Fuel		608			466			30			1,799			1,222			47
Purchased services and materials		465			413			13			1,369			1,216			13
Depreciation		372			363			2			1,107			1,054			5
Equipment and other rents		292			290			1			864			914			(5	)
Other		178			179			(1	)		546			558			(2	)
Total operating expenses		3,007			2,710			11			8,887			8,009			11
Operating Income		1,401			961			46			3,668			2,380			54
Other income		25			14			79			45			172			(74	)
Interest expense		(153	)		(156	)		(2	)		(460	)		(447	)		3
Income before income taxes		1,273			819			55			3,253			2,105			55
Income taxes		(495	)		(305	)		62			(1,248	)		(764	)		63
Net Income	$	778		$	514			51	%	$	2,005		$	1,341			50	%
Share and Per Share
Earnings per share - basic	$	1.58		$	1.02			55	%	$	4.01		$	2.67			50	%
Earnings per share - diluted	$	1.56		$	1.01			54		$	3.98		$	2.66			50
Weighted average number of shares - basic		493.0			503.1			(2	)		499.8			502.9			(1	)
Weighted average number of shares - diluted		497.7			507.0			(2	)		504.3			505.4			-
Dividends declared per share	$	0.33		$	0.27			22		$	0.93		$	0.81			15
Operating Ratio		68.2%			73.8%			(5.6	)pts		70.8%			77.1%			(6.3	)pts
Effective Tax Rate		38.9%			37.2%			1.7	pts		38.4%			36.3%			2.1	pts

* Certain amounts have been adjusted for the retrospective change in accounting principle for rail grinding. See page 9 for effects of the adjustments.

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UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES

Freight Revenues Statistics (unaudited)

	3rd Quarter							Year-to-Date
For the Periods Ended September 30,	2010		2009		%			2010		2009		%
Freight Revenues (Millions)
Agricultural	$	750	$	649		16	%	$	2,178	$	1,928		13	%
Automotive		309		227		36			948		552		72
Chemicals		629		551		14			1,808		1,563		16
Energy		922		831		11			2,602		2,353		11
Industrial Products		697		557		25			1,987		1,634		22
Intermodal		880		656		34			2,375		1,802		32
Total	$	4,187	$	3,471		21	%	$	11,898	$	9,832		21	%
Revenue Carloads (Thousands)
Agricultural		229		215		7	%		670		630		6	%
Automotive		146		124		18			456		314		45
Chemicals		221		202		9			633		570		11
Energy		535		531		1			1,537		1,522		1
Industrial Products		282		235		20			810		686		18
Intermodal		903		728		24			2,472		2,012		23
Total		2,316		2,035		14	%		6,578		5,734		15	%
Average Revenue per Car
Agricultural	$	3,271	$	3,026		8	%	$	3,249	$	3,062		6	%
Automotive		2,114		1,827		16			2,076		1,759		18
Chemicals		2,858		2,730		5			2,858		2,742		4
Energy		1,721		1,564		10			1,692		1,546		9
Industrial Products		2,470		2,367		4			2,453		2,381		3
Intermodal		974		901		8			961		896		7
Average	$	1,807	$	1,706		6	%	$	1,809	$	1,715		5	%

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UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES

Condensed Consolidated Statements of Financial Position (unaudited)

Millions, Except Percentages	Sep. 30, 2010		Dec. 31, 2009
			(Adjusted)*
Assets
Cash and cash equivalents	$	1,358	$	1,850
Other current assets		2,552		1,830
Investments		1,104		1,036
Net properties		37,749		37,202
Other assets		238		266
Total assets	$	43,001	$	42,184
Liabilities and Common Shareholders’ Equity
Debt due within one year	$	659	$	212
Other current liabilities		2,526		2,470
Debt due after one year		9,060		9,636
Deferred income taxes		11,480		11,044
Other long-term liabilities		1,840		2,021
Total liabilities		25,565		25,383
Total common shareholders’ equity		17,436		16,801
Total liabilities and common shareholders’ equity	$	43,001	$	42,184
Debt to Capital		35.8%		37.0%
Adjusted Debt to Capital**		44.0%		46.1%

* Certain amounts have been adjusted for the retrospective change in accounting principle for rail grinding. See page 9 for the effects of the adjustments.

** Adjusted Debt to Capital is a non-GAAP measure; however, we believe that it is important in evaluating our financial performance. See page 8 for a reconciliation to GAAP.

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UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES

Condensed Consolidated Statements of Cash Flows (unaudited)

Millions,	Year-to-Date
For the Periods Ended September 30,	2010			2009
				(Adjusted)*
Operating Activities
Net income	$	2,005		$	1,341
Depreciation		1,107			1,054
Deferred income taxes and unrecognized tax benefits		433			310
Other - net		(825	)		(506	)
Cash provided by operating activities		2,720			2,199
Investing Activities
Capital investments		(1,686	)		(1,808	)
Other - net		13			90
Cash used in investing activities		(1,673	)		(1,718	)
Financing Activities
Debt issued		894			843
Common shares repurchased		(1,019	)		-
Debt repaid		(933	)		(826	)
Dividends paid		(438	)		(408	)
Other - net		(43	)		96
Cash used in financing activities		(1,539	)		(295	)
Net Change in Cash and Cash Equivalents		(492	)		186
Cash and cash equivalents at beginning of year		1,850			1,249
Cash and Cash Equivalents End of Period	$	1,358		$	1,435
Free Cash Flow**
Cash provided by operating activities	$	2,720		$	2,199
Receivables securitization facility***		400			184
Cash provided by operating activities excluding receivables securitization facility		3,120			2,383
Cash used in investing activities		(1,673	)		(1,718	)
Dividends paid		(438	)		(408	)
Free cash flow	$	1,009		$	257

* Certain amounts have been adjusted for the retrospective change in accounting principle for rail grinding. See page 9 for the effects of the adjustment.

** Free cash flow is a non-GAAP measure; however, we believe that it is important in evaluating our financial performance and measures our ability to generate cash without incurring additional financing.

*** Effective January 1, 2010, new accounting guidance requires us to account for receivables transferred under our receivables securitization facility as secured borrowings in our Condensed Consolidated Statements of Financial Position and as financing activities in our Condensed Consolidated Statements of Cash Flows. The receivables securitization facility line in the above table is included in our free cash flow calculation to adjust cash provided by operating activities as though our receivables securitization facility had been accounted for under the new accounting guidance for all periods presented.

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UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES

Operating and Performance Statistics (unaudited)

	3rd Quarter							Year-to-Date
For the Periods Ended September 30,	2010		2009		%			2010		2009		%
Operating/Performance Statistics
Gross ton-miles (GTMs) (millions)		239,541		218,810		9	%		692,313		626,242		11	%
Employees (average)		43,375		43,248		-			42,692		43,989		(3	)
GTMs (millions) per employee		5.52		5.06		9			16.22		14.24		14
Customer satisfaction index		90		88		2	pts		89		87		2	pts
Locomotive Fuel Statistics
Average fuel price per gallon consumed	$	2.24	$	1.87		20	%	$	2.23	$	1.65		35	%
Fuel consumed in gallons (millions)		261		242		8			781		723		8
Fuel consumption rate*		1.092		1.107		(1	)		1.129		1.155		(2	)
AAR Reported Performance Measures
Average train speed (miles per hour)		25.7		27.4		(6	)  %		26.1		27.3		(4	)  %
Average terminal dwell time (hours)		25.0		24.5		2			25.3		24.4		4
Average rail car inventory (thousands)		274.4		281.5		(3	)		275.7		283.2		(3	)
Revenue Ton-Miles (Millions)
Agricultural		22,062		19,563		13	%		64,261		58,484		10	%
Automotive		2,984		2,619		14			9,441		6,566		44
Chemicals		13,956		12,544		11			40,614		36,024		13
Energy		59,331		57,391		3			168,346		164,134		3
Industrial Products		15,687		13,479		16			45,507		39,444		15
Intermodal		20,489		18,411		11			59,457		51,009		17
Total		134,509		124,007		8	%		387,626		355,661		9	%

* Fuel consumption is computed as follows: gallons of fuel consumed divided by gross ton-miles in thousands.

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UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES

Condensed Consolidated Statements of Income (unaudited)

	2010
Millions, Except Per Share Amounts and Percentages	1st Qtr			2nd Qtr			3rd Qtr			Year-to-Date
Operating Revenues
Freight revenues	$	3,755		$	3,956		$	4,187			$	11,898
Other revenues		210			226			221				657
Total operating revenues		3,965			4,182			4,408				12,555
Operating Expenses
Compensation and benefits		1,059			1,051			1,092				3,202
Fuel		583			608			608				1,799
Purchased services and materials		432			472			465				1,369
Depreciation		367			368			372				1,107
Equipment and other rents		290			282			292				864
Other		246			122			178				546
Total operating expenses		2,977			2,903			3,007				8,887
Operating Income		988			1,279			1,401				3,668
Other income		1			19			25				45
Interest expense		(155	)		(152	)		(153	)			(460	)
Income before income taxes		834			1,146			1,273				3,253
Income tax expense		(318	)		(435	)		(495	)			(1,248	)
Net Income	$	516		$	711		$	778			$	2,005
Share and Per Share
Earnings per share - basic	$	1.02		$	1.42		$	1.58			$	4.01
Earnings per share - diluted	$	1.01		$	1.40		$	1.56			$	3.98
Weighted average number of shares - basic		504.5			501.8			493.0				499.8
Weighted average number of shares - diluted		508.7			506.5			497.7				504.3
Dividends declared per share	$	0.27		$	0.33		$	0.33			$	0.93
Operating Ratio		75.1%			69.4%			68.2%				70.8%
Effective Tax Rate		38.1%			38.0%			38.9%				38.4%

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UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES

Freight Revenues Statistics (unaudited)

	2010
	1st Qtr		2nd Qtr		3rd Qtr		Year-to-Date
Freight Revenues (Millions)
Agricultural	$	730	$	698	$	750		$      2,178
Automotive		305		334		309		948
Chemicals		587		592		629		1,808
Energy		844		836		922		2,602
Industrial Products		598		692		697		1,987
Intermodal		691		804		880		2,375
Total	$	3,755	$	3,956	$	4,187		$    11,898
Revenue Carloads (Thousands)
Agricultural		228		213		229		670
Automotive		151		159		146		456
Chemicals		203		209		221		633
Energy		516		486		535		1,537
Industrial Products		242		286		282		810
Intermodal		742		827		903		2,472
Total		2,082		2,180		2,316		6,578
Average Revenue per Car
Agricultural	$	3,202	$	3,277	$	3,271		$      3,249
Automotive		2,022		2,094		2,114		2,076
Chemicals		2,893		2,826		2,858		2,858
Energy		1,636		1,722		1,721		1,692
Industrial Products		2,474		2,420		2,470		2,453
Intermodal		930		974		974		961
Average	$	1,804	$	1,815	$	1,807		$      1,809

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UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES

Non-GAAP Measures Reconciliation to GAAP

Debt to Capital*

Millions, Except Percentages	Sep. 30, 2010		Dec. 31, 2009
			(Adjusted)**
Debt (a)	$	9,719		$          9,848
Equity		17,436		16,801
Capital (b)	$	27,155		$        26,649
Debt to capital (a/b)		35.8%		37.0%

* Total debt divided by total debt plus equity. Management believes this is an important measure in evaluating our balance sheet strength and is important in managing our credit ratios and financing relationships.

** Certain amounts have been adjusted for the retrospective change in accounting principle for rail grinding. See page 9 for the effects of the adjustments

Adjusted Debt to Capital, Reconciliation to GAAP*

Millions, Except Percentages	Sep. 30, 2010		Dec. 31, 2009
			(Adjusted)**
Debt	$	9,719	$	9,848
Value of sold receivables		-		400
Debt including value of sold receivables		9,719		10,248
Net present value of operating leases		3,520		3,672
Unfunded pension and OPEB		456		456
Adjusted debt (a)	$	13,695	$	14,376
Equity		17,436		16,801
Adjusted capital (b)	$	31,131	$	31,177
Adjusted debt to capital (a/b)		44.0%		46.1%

* Total debt plus value of sold receivables plus net present value of operating leases plus after-tax unfunded pension and OPEB obligation divided by total debt plus value of sold receivables plus net present value of operating leases plus after-tax unfunded pension and OPEB obligation plus equity. Effective January 1, 2010, the value of the outstanding undivided interest held by investors under our receivables securitization facility is included in our Condensed Consolidated Statements of Financial Position as debt due after one year. At September 30, 2010, that amount was $100 million. Operating leases were discounted using 6.3% at September 30, 2010 and December 31, 2009. The lower discount rate reflects changes to interest rates and our current financing costs. Management believes this is an important measure in evaluating the total amount of leverage in our capital structure including off-balance sheet obligations.

** Certain amounts have been adjusted for the retrospective change in accounting principle for rail grinding. See page 9 for the effects of the adjustments

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UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES

Impact of Retrospective Change in Accounting Principle for Rail Grinding (unaudited)

Condensed Consolidated Statements of Income

	For the Three Months Ended September 30, 2009									For the Nine Months Ended September 30, 2009
Millions, Except Per Share Amounts	As Originally Reported			Impact of Adjustment			As Adjusted			As Originally Reported			Impact of Adjustment			As Adjusted
Purchased services & materials	$	403		$	10		$	413		$	1,193		$	23		$	1,216
Depreciation	$	367		$	(4	)	$	363		$	1,067		$	(13	)	$	1,054
Total operating expenses	$	2,704		$	6		$	2,710		$	7,999		$	10		$	8,009
Operating income	$	967		$	(6	)	$	961		$	2,390		$	(10	)	$	2,380
Income before income taxes	$	825		$	(6	)	$	819		$	2,115		$	(10	)	$	2,105
Income taxes	$	(308	)	$	3		$	(305	)	$	(768	)	$	4		$	(764	)
Net income	$	517		$	(3	)	$	514		$	1,347		$	(6	)	$	1,341
Earnings per share - basic	$	1.03		$	(0.01	)	$	1.02		$	2.68		$	(0.01	)	$	2.67
Earnings per share - diluted	$	1.02		$	(0.01	)	$	1.01		$	2.67		$	(0.01	)	$	2.66

Condensed Consolidated Statement of Financial Position

Millions, December 31, 2009	As Originally Reported		Impact of Adjustment			As Adjusted
Net properties	$	37,428	$	(226	)	$	37,202
Total assets	$	42,410	$	(226	)	$	42,184
Deferred income taxes	$	11,130	$	(86	)	$	11,044
Total liabilities	$	25,469	$	(86	)	$	25,383
Total common shareholders’ equity	$	16,941	$	(140	)	$	16,801
Total liabilities and common shareholders’ equity	$	42,410	$	(226	)	$	42,184

Condensed Consolidated Statement of Cash Flows

	For the Nine Months Ended September 30, 2009
Millions,	As Originally Reported			Impact of Adjustment			As Adjusted
Net income	$	1,347		$	(6	)	$	1,341
Depreciation	$	1,067		$	(13	)	$	1,054
Deferred income taxes and unrecognized tax benefits	$	314		$	(4	)	$	310
Cash provided by operating activities	$	2,222		$	(23	)	$	2,199
Capital investments	$	(1,831	)	$	23		$	(1,808	)
Cash used in investing activities	$	(1,741	)	$	23		$	(1,718	)

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