Two companies, one strategy: fix what you control
On 22 October 2026, Dow Inc. and Union Pacific each reported third-quarter results. They sell very different things: plastics and chemicals in one case, rail freight in the other. The message was similar. Both are trying to grow by running their own businesses better and by their own choices, not by waiting for the economy to lift them.1,2
For Dow, that means cutting costs. For Union Pacific, it means spending more and seeking a merger. Both bets are unproven. This piece sets what the executives said on their calls against what Dow's filed accounts show, and flags where the evidence runs out.
Why Dow needs a cost reset: the filed numbers
The case for Dow's cost programme is clearest in its annual accounts. Revenue fell from $44.6 billion in 2023 to $43.0 billion in 2024 and $40.0 billion in 2025.3 Its cost of revenue, the direct cost of making what it sells, fell too, from $39.7 billion to $38.4 billion to $37.4 billion.3 Costs came down, but not as fast as sales.
Earnings per share, which is profit divided by the number of shares, went from $0.82 in 2023 to $1.57 in 2024, then to a loss of $3.70 per share in 2025.3 Cash generated by day-to-day operations dropped sharply over the same years: $5.2 billion in 2023, $2.9 billion in 2024 and $1.0 billion in 2025.4 That is about one-fifth of the 2023 level.
Dow's cash balance tells a steadier story. It stood at $3.0 billion at the end of 2023, $2.2 billion at the end of 2024 and $3.8 billion at the end of 2025.5 It was $4.1 billion in the first quarter of 2026.5 The company is not short of cash, but the business is generating much less of it than it used to.
One more verified detail matters to shareholders. The number of Dow shares in existence rose from about 702 million at the end of 2023 to about 718 million at the end of 2025, and about 721 million in the first quarter of 2026.6 More shares mean each one claims a smaller slice of any profit.
What management said: "Transform to Outperform"
Against that background, CEO Karen Carter described a recovery led by cost control. She said net sales were "up 13% year-over-year with growth in every operating segment" and that operating EBITDA, a measure of profit before certain accounting charges, was more than $1.5 billion.1 The company's headline guidance is for about $1.5 billion of EBITDA in the fourth quarter.1
The cost programme is called Transform to Outperform. Carter said it is delivering benefits ahead of its initial schedule and is on track for roughly $700 million of growth and productivity gains this year.1 It includes cutting about 4,500 Dow roles. In her words: "To date, we have implemented approximately 70% of those reductions, and we expect to substantially complete this phase of the transformation by year-end."1
The target for 2027 is about $1.3 billion of self-help benefits, which means savings and gains the company can deliver without help from the market.1 To put that in context, it is slightly more than the $1.0 billion of operating cash Dow generated in all of 2025.1,4 If delivered, it is a large sum relative to recent performance. It is a target, though, and not a result.
The upside that is not in the bag
Dow's second lever is price. Carter said that if Dow achieves the 7 cents per pound polyethylene price increase it has on the table for October, plus 5 cents in November, "that will provide an upside", which the call summary puts at about $200 million.1 Polyethylene is the plastic used in packaging and films.
Her fourth-quarter guidance assumes ethane, a natural-gas liquid that is Dow's main raw material, will be "in the mid- to high $0.20 per gallon range." The call summary adds that each 3-cent move in ethane corresponds to roughly a 1-cent move in polyethylene prices.1 Price increases announced are not price increases collected. That is why we treat the $200 million as a possibility.
Carter also said Dow is "not seeing any logistics constraints coming out of the U.S. Gulf Coast."1
Where Dow is still weak
Management did not claim a clean sweep. The call summary describes soft markets for MDI, a chemical used in foams and insulation, and Carter said "we do expect to move back to a longer market" in the fourth quarter.1 Silicones were described as a "tale of two cities."1
The largest open sore is Sadara, the Saudi Arabia joint venture with Aramco. Carter said, "we've established a financial boundary around Sadara." According to the call summary, Dow has stopped recognising equity losses from it and limited its funding commitment to about $1.3 billion, and it is in talks with Aramco.1 That cap is a similar size to the 2027 savings target, so the two numbers are worth reading side by side.1
Union Pacific: record profit, bigger spending, a merger
Union Pacific, one of the largest US freight railroads, reported what CEO Vincenzo Vena called "record financial results." Net income was $2.1 billion, and adjusted earnings per share grew 15% to $3.53 on 6% volume growth.2 He also noted that "higher fuel prices were a big cost driver."2 The company affirmed that 2026 reported earnings per share will grow at a high single-digit rate, and it lifted 2026 capital spending to $3.5 billion.2
Vena said the number of cars that missed their planned schedule, which the railroad calls "32-hour cars," is "like 15% lower with business up."2 That is a service-quality claim from the company itself and we have no independent measure of it.
The merger is the bolder bet. Vena said, "I'm 99.999% sure that it's going to be approved" by the US Surface Transportation Board (STB), the regulator that must sign off. The call summary says he would walk away from a bad deal.2 He also said "we have over 500 customers that have written letters of support."2 Letters of support are not a ruling, and 99.999% is a figure of speech and not a probability anyone has calculated. The regulator has not yet decided.
How far to trust all this
Both companies' numbers here come from earnings-call summaries published by NewsEOD on 22 October. Our own checks put that source's reliability at 60%: of 1,107 claims we tested, 60% held up.1,2 That is useful but not strong. It is why we have confined firm statements to the SEC-filed figures for Dow and attributed everything else to the executive who said it.
We have no filed figures for Union Pacific in our verified data, so its record-profit claim rests on the call alone. We also have no verified Dow figures for the current year's quarters apart from cash and share count through the first quarter of 2026, so the claim that sales rose 13% cannot yet be checked against a filing.
A separate research note from CB Insights on 23 October profiled founders preparing for AI agents to do online buying, including Marc Lore and Scot Wingo.7 It is a side thread, and nothing in it bears on Dow or Union Pacific.
What to watch
- Dow's year-end role cuts: management said this phase should be substantially complete by year-end, from about 70% now.1
- Polyethylene prices: whether the October and November increases actually stick decides whether the $200 million upside appears.1
- Dow's SEC filing for the quarter: it will show whether the 13% sales growth and the operating profit hold up in audited form, and whether operating cash flow recovers from $1.0 billion.1,4
- The STB's decision on the Union Pacific merger: the regulator's ruling, and not management's confidence, is what counts.2
