The particular split-phase traction power system of AC electrified railways (ERs) restricts its regenerative braking energy (RBE) utilization and photovoltaic (PV) penetration. Networked flexible traction substation (FTSS) operation is a promising paradigm to address this restriction. Therefore, this paper proposes a networked FTSS system architecture that ties adjacent FTSSs via unified power flow controllers (UPFC) at sectioning posts (SPs), which matches the technical characteristics of split-phase ERs obtaining the lower capacity requirement. Correspondingly, a real-time hierarchical energy management strategy is designed. The networked FTSS management level optimizes the energy cooperation among FTSSs, i.e., the exchange power at SPs. It aims at maximizing the global RBE and PV energy utilization and shaving the maximum demand of each FTSS. At the individual FTSS management level, each FTSS autonomously regulates the power outputs of the local back-to-back converter and energy storage system to maximize the local RBE and PV energy utilization and improve the local power quality issues. These two energy management levels operate independently with different time scales, making the networked FTSS system have good extensibility and reliability. Finally, the performance of the proposed scheme is verified via hardware-in-the-loop tests.