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The results did not meet Wall Street expectations as it delivered 1% less freight and had to deal with the severe cold in February. Analysts surveyed by Zacks Investment Research had projected per-share earnings of $2.06. The railroad estimated that costs related to the weather weighed down its results by 16 cents per share.

Revenue fell 4% to $5 billion, also short of Wall Street expectations as coal and industrial revenue weakened.

Company shares fell more than 3%.

The railroad said it expects shipping volume to grow roughly 6% overall in 2021 as the economy recovers from the pandemic and industrial production increases.

“The economy is definitely strengthening. What we are seeing is the positive is it is more broad-based and continuous,” CEO Lance Fritz said.

Despite a quarter dragged down by severe weather and higher fuel costs, Citi research analyst Christian Wetherbee said Union Pacific’s outlook suggests the company expects to ride along with an economy on the mend.

Union Pacific Corp. cut its expenses 3%, to $3 billion, as it worked to improve productivity during the quarter.

“What we are focused on is what the STB says the next Class I merger must provide and that is an enhancement to competition and clear improvement for all customers. For that to be true in any transaction, our current service product has to remain intact,” Fritz said. “Our concern is making sure we have good operational and commercial access to all the customers that we serve currently in Mexico and in other parts whether they are near or on the CP railroad or the CN railroad.”

Fritz said he is also concerned that regulators could impose conditions on either deal that would hurt competition across the industry.

Union Pacific is one of the nation’s largest railroads, and it operates 32,400 miles (52,000 kilometers) of track in 23 Western states.

Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on UNP at https://www.zacks.com/ap/UNP