Our strong fourth quarter results demonstrate what is possible when we work together to deliver Safety, Service and Operational Excellence. Our team is aligned and moving forward with powerful momentum. Being aligned and clear on our objectives gives me great confidence that we have a winning strategy. As we tackle our work together, I am very excited and grateful for what we are achieving for all of our employees and our stakeholders.
Note: In this letter to employees, Jim recaps Union Pacific's fourth quarter performance and financial results.
Our results show the power of Operational Excellence – which means being able to handle the ups and downs that come with running a large rail network in North America. Because of our collective efforts, we reported fourth quarter Net Income of $1.65 billion, an increase compared to $1.64 billion in fourth quarter 2022. Our fourth quarter Operating Revenue and Expenses year-over-year were flat, and our Freight Car Velocity and Locomotive Productivity were both up 14%. These strong results prove the actions we are taking have increased the efficiency of our railroad while also improving service for our customers.
Operational efficiency is about managing our resources so we can compete and win with our customers. Lower margins and a better service product give us a competitive edge that allows us to aggressively pursue new business and win.
Achieving this level of improvement is only possible when we work hard together. As you may know, I spent my career as a railroader. I know many of you are reading this letter right now surrounded by frigid weather conditions and intense physical demands. Although it may have been a long time ago, I know what it means to show up and work in severe temperatures at all hours. I see you, and I want to take a moment to acknowledge every employee who continues to brave extreme elements to keep our railroad moving. Thank you.
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As we move forward, it's very exciting to see how our service continues to improve, but we have more to do. It’s going to take time to become the best at safety. As we deliver the service we sold our customers, it’s going to take time for our customers to trust that our improvements are in place for the long term. We must continue our focus on simplifying how we work and driving decision making to the people closest to getting the work done. We must continue responsibly controlling our costs and demonstrate resilience by always being fluid and having a buffer of the appropriate level of resources. Most importantly, we must continue focusing on people, engaging our teams and stakeholders so our relationships continue to improve.
I am confident we will continue succeeding together and very excited about the momentum at hand. We have the right team, the right strategy and the right resources, and we are ready to catch and address what will be thrown at us. We all have an important role to play. Thank you for your continued support of our customers and of one another.