The railway industry is experiencing a peculiar paradox: while passenger numbers are on the rise, revenue is struggling to keep pace. According to the ORR, the rail regulator, the number of journeys made in the July to September 2025 quarter increased by 8% compared to the previous year, reaching an impressive 467 million. However, this surge in passenger numbers has not translated into higher revenue. In fact, the average revenue per journey has decreased from £6.99 to £6.88, despite the overall revenue rising by 6% to £3.2 billion. This discrepancy can be attributed to the fact that journeys are becoming shorter, with a 6% increase in total mileage traveled by passengers, despite the rise in trip numbers. The situation is particularly challenging for train companies, as almost all of them are reporting increased passenger numbers, except for TransPennine Express and Hull Trains, which are experiencing modest declines. The decline in regular commuter traffic and the associated loss of season ticket sales have significantly impacted railway revenues. With some people working a Tuesday-Thursday week, the railways are still required to provide a full service, but face a financial hole from the loss of a small percentage of passengers on Monday and Friday. This reduction is not significant enough to allow for cost-saving service cuts, but it is enough to require central government funding to keep services running. There are hints of a recovery, as journeys made with season tickets rose by 8% over the same period a year ago. However, sales of season tickets are still stuck at 12% of franchised ticket sales, and are still sharply down from roughly a third of all tickets being season tickets before the pandemic. This suggests that people with season tickets are willing to commute more often, whereas those who buy three tickets a week are still holding off from a four or five-day work week in the office. The establishment of Great British Railways (GBR) also bodes well for the industry's finances, and we can expect to see a flurry of ministerial statements in a few years claiming credit for a financial improvement, which has already started. The report is available here: https://dataportal.orr.gov.uk/media/i5ap5mxy/passenger-rail-usage-jul-sep-2025.pdf
