1998		1997		% Chg
Operating Revenues	$ 2,404		$ 2,575		-	7
Operating Expenses (a)	2,201		2,160		+	2
Operating Income	203		415			U
Other Income - Net	37		102			F
Interest Expense	189		156		+	21
Income Before Income Taxes	51		361			U
Income Tax Expense	(19)		(124)			F
Income From Continuing Operations	$32		$237			U
Discontinued Operations	6		3			F
Net Income	$38		$240			U
Diluted Earnings Per Share:  (b)
Income From Continuing Operations	$0.13		$0.95			U
Discontinued Operations	$0.02		$0.01			F
Net Income	$0.15		$0.96			U
Average Basic Shares Outstanding (MM)	246.1		245.9			--
Average Diluted Shares Outstanding (MM)	246.7		248.6			--

(a) Includes one-time merger expenses of $12 million pre-tax ($7 million after-tax or $.03 per share) in 1998, $16 million pre-tax ($10 million after-tax or $.04 per share) in 1997. Merger expenses include severance, relocation and certain other costs related to Union Pacific employees affected by the merger.

(b) Excludes 21.8 million anti-dilutive common stock equivalents in 1998.

	1998		1997		% Chg
Operating Revenues	$ 7,094		$ 7,817		-	9
Operating Expenses (a)	7,012		6,611		+	6
Operating Income (Loss)	82		1,206			U
Other Income - Net	113		159		-	29
Interest Expense	526		451		+	17
Income (Loss) Before Income Taxes	(331)		914			U
Income Tax Benefit (Expense)	140		(329)			F
Income (Loss) From Continuing Operations	($191)		$585			U
Discontinued Operations	(252)		(1)			U
Net Income (Loss)	($443)		$584			U
Diluted Earnings Per Share:  (b)
Income (Loss) From Continuing Operations	$(0.78)		$ 2.36			U
Discontinued Operations	(1.02)		(0.01)			U
Net Income (Loss)	$(1.80)		$2.35			U
Average Basic Shares Outstanding (MM)	246.0		245.7			--
Average Diluted Shares Outstanding (MM)	246.0		248.0			--

(a) Includes estimated one-time merger expenses of $58 million pre-tax ($36 million after-tax or $.15 per share) in 1998, $75 million pre-tax ($46 million after-tax or $.19 per share) in 1997. Merger expenses include severance, relocation and certain other costs related to Union Pacific employees affected by the merger.

(b) Excludes 21.8 million anti-dilutive common stock equivalents in 1998.

Third Quarter								Year-to-Date
1998		1997		% Chg				1998		1997		% Chg
							Commodity Revenue (000):
$ 515,764 384,267 334,213 456,221 382,229 203,874 $ 2,276,568		$ 482,625 431,141 343,281 509,529 471,103 218,015 $ 2,455,694		+ - - - - - -	7 11 3 10 19 6 7		Energy Chemicals Agricultural Products Industrial Products Intermodal Automotive    Total	$ 1,500,941 1,157,446 941,850 1,359,310 1,116,443 677,375 $ 6,753,365		$ 1,489,939 1,318,589 1,107,669 1,517,954 1,343,159 706,606 $ 7,483,916		+ - - - - - -	1 12 15 10 17 4 10
							Revenue Carloads:
449,436 231,860 213,377 353,946 632,445 140,905 2,021,969		439,769 249,507 224,641 369,996 737,909 149,274 2,171,096		+ - - - - - -	2 7 5 4 14 6 7		Energy Chemicals Agricultural Products Industrial Products Intermodal Automotive    Total	1,318,585 681,368 610,341 1,020,802 1,859,001 465,555 5,955,652		1,332,464 744,635 698,580 1,115,245 2,140,508 473,281 6,504,713		- - - - - - -	1 8 13 8 13 2 8
							Average Revenue Per Car:
$ 1,148 1,657 1,566 1,289 604 1,447 $ 1,126		$ 1,097 1,728 1,528 1,377 638 1,461 $ 1,131		+ - + - - -	5 4 2 6 5 1 0		Energy Chemicals Agricultural Products Industrial Products Intermodal Automotive    Total	$ 1,138 1,699 1,543 1,332 601 1,455 $ 1,134		$ 1,118 1,771 1,586 1,361 627 1,493 $ 1,151		+ - - - - - -	2 4 3 2 4 3 1

Third Quarter								Year-to-Date
1998		1997		% Chg				1998		1997		% Chg
$ 2,404		$ 2,575		-	7		Operating Revenues	$ 7,094		$ 7,817		-	9
							Operating Expenses (a)
925		891		+	4		Salaries and Benefits	2,779		2,674		+	4
253		244		+	4		Depreciation and Retirements	751		732		+	3
131		119		+	10		Materials and Supplies	399		391		+	2
193		229		-	16		Fuel and Utilities	604		766		-	21
329		336		-	2		Rent Expense	1,038		969		+	7
370		341		+	9		Other	1,441		1,079		+	34
2,201		2,160		+	2		Total	7,012		6,611		+	6
$ 203		$ 415		-	51		Operating Income	$ 82		$ 1,206			U
							Operating Statistics
2,022		2,171		-	7		Revenue Carloads (Thousands)	5,956		6,505		-	8
111,018		112,872		-	2		Revenue Ton-Miles (Millions)	323,368		349,474		-	7
208,703		214,938		-	3		Gross Ton-Miles (Millions)	613,131		659,341		-	7
2.05	¢	2.18	¢	-	6		Rev/RTM (Comm Rev Based)	2.09	¢	2.14	¢	-	2
1,126		1,131			--		Average Commodity Revenue Per Car	1,134		1,151		-	1
53,862		52,387		+	3		Average Headcount for the Period	53,431		52,656		+	1
60	¢	67	¢	-	10		Average Fuel Cost Per Gallon	62	¢	71	¢	-	13
284		302		-	6		Fuel Consumed in Gallons (MM)	857		943		-	9
91.6		83.9		+	7.7	pts	Operating Ratio (%)	98.8		84.6		+	14.2	pts
12		16					Merger Expenses ($MM) (a)	58		75
133		69					Merger Benefits ($MM)	301		156

(a) Includes merger expenses (severance, relocation and certain other costs) related to Union Pacific employees affected by the merger.

		Third Quarter
		1998		1997
Breakdown of Other Income
Asset Sales
	Telecom Contract Buyout	$  18		$
	Gain on Sale of Aircraft	4		19
	Skyway Write-Down	(12)
	Sale of Signboard Business			37
	BNSF Track Sale			11
	Other	5		11
	Total Asset Sales	15		78
Interest and Other		22		24
	Total	$  37		$ 102
		Third Quarter
		1998		1997
Major Unusual Items
Merger Implementation		$ (12)		$ (16)
Corporate Restructuring				(18)

Third Quarter								Year-to-Date
1998		1997		% Chg				1998		1997		% Chg
$ 257		$ 250		+	3		Operating Revenues	$ 776		$ 701		+	11
							Operating Expenses: (a)
155		149		+	4		Salaries and Benefits	468		429		+	9
11		11			--		Depreciation and Retirements	34		32		+	6
12		11		+	9		Materials and Supplies	34		30		+	13
11		12		-	8		Fuel and Utilities	34		38		-	11
20		20			--		Rent and Purchased Transportation	63		52		+	21
36		33		+	9		Other	105		96		+	9
245		236		+	4		Total	738		677		+	9
$ 12		$ 14		-	14		Operating Income (a)	$ 38		$ 24			F
							Operating Statistics:
2,005		2,008			--		Millions of Pounds Hauled - LTL	6,028		5,713		+	6
111		133		-	17		Millions of Pounds Hauled - TL	337		398		-	15
2,116		2,141		-	1		Millions of Pounds Hauled - Combined	6,365		6,111		+	4
$ 12.18		$ 11.81		+	3		Revenue/CWT - LTL	$ 12.26		$ 11.63		+	5
$ 5.32		$ 5.16		+	3		Revenue/CWT - TL	$ 5.39		$ 5.09		+	6
$ 11.82		$ 11.39		+	4		Revenue/CWT - Combined	$ 11.90		$ 11.20		+	6
11,508		11,608		-	1		Average Headcount for the Period	11,625		11,403		+	2
48	¢	59	¢	-	19		Average Fuel Price Per Gallon	53	¢	64	¢	-	17
13,310		12,950		+	3		Fuel Consumed in Gallons (Thousands)	40,311		38,400		+	5
95.4		94.5		+	0.9	pts	Operating Ratio (%)	95.1		96.7		-	1.6	pts

(a) Excludes goodwill amortization.

		September 30, 1998		December 31, 1997
Assets:
	Current Assets Investments Properties - Net Net Assets of Discontinued Operations Other Assets    Total	$   1,497 664 26,528 518 222 $ 29,429		$   1,239 624 25,524 955 185 $ 28,527
Liabilities and Stockholders' Equity:
	Current Portion of Long Term Debt Other Current Liabilities Long Term Debt    Commercial Paper/Bank Notes    Other Long Term Debt Deferred Income Taxes Other Liabilities Convertible Preferred Shares Common Stockholders' Equity    Total	$     178 2,602 1,660 7,369 5,978 2,513 1,500 7,629 $ 29,429		$     229 2,854 1,743 6,537 6,284 2,655 -- 8,225 $ 28,527

		1998		1997
Cash From Operations:
	Net Income (Loss) From Continuing Operations Depreciation and Amortization Deferred Income Taxes Other Cash From Continuing Operations Cash From Discontinued Operations	($191) 751 (122) (278) 160 18		$ 585 732 228 (427) 1,118 44
Investing Activities
	Capital Investments Other Total Cash (Used) by Investing Activities	(1,760) 92 (1,668)		(1,407) 201 (1,206)
Financing Activities:
	Dividends Paid Debt Repaid Financings and Other - Net Total Cash Provided by Financing Activities	(205) (1,751) 3,911 1,955		(317) (248) 620 55
Net Change in Cash and Temporary Investments		$465		$11

(Many of the comments we have made this morning may contain forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. Such forward-looking information is based on information available at this time and is subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the statements. Important factors that could cause such differences include, but are not limited to, whether the Railroad is fully successful in overcoming its congestion-related problems and implementing its service recovery plans, industry competition, regulatory developments, natural events such as floods and earthquakes, the effects of adverse general economic conditions, fuel prices, labor strikes, the impact of the year 2000 systems problems and the ultimate outcome of shipper claims related to congestion, environmental investigations or proceedings and other types of claims and litigations.)

Go to Press Release: Union Pacific Announces Third Quarter Results