CSX Corporation
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CSX CORPORATION
PART I
Item 1. Business
CSX Corporation, together with its subsidiaries ("CSX" or the “Company”), based in Jacksonville, Florida, is one of the nation's leading transportation companies. The Company provides rail-based freight transportation services including traditional rail service, the transport of intermodal containers and trailers, as well as other transportation services such as rail-to-truck transfers and bulk commodity operations. CSX and the rail industry provide customers with access to an expansive and interconnected transportation network that plays a key role in North American commerce and is critical to the long-term economic success and improved global competitiveness of the United States. In addition, freight railroads provide the most economical and environmentally efficient means to transport goods over land.
CSX Transportation, Inc.
CSX’s principal operating subsidiary, CSX Transportation, Inc. (“CSXT”), provides an important link to the transportation supply chain through its approximately 20,000 route-mile rail network and serves major population centers in 26 states east of the Mississippi River, the District of Columbia and the Canadian provinces of Ontario and Quebec. It has access to over 70 ocean, river and lake port terminals along the Atlantic and Gulf Coasts, the Mississippi River, the Great Lakes and the St. Lawrence Seaway. This access allows the Company to meet the dynamic transportation needs of manufacturers, industrial producers, the automotive industry, construction companies, farmers and feed mills, wholesalers and retailers, and energy producers. The Company’s intermodal business links customers to railroads via trucks and terminals. CSXT also serves thousands of production and distribution facilities through track connections with other Class I railroads and approximately 250 short-line and regional railroads.
CSXT is also responsible for the Company's real estate sales, leasing, acquisition and management and development activities. Substantially all of these activities are focused on supporting railroad operations.
Other Entities
In addition to CSXT, the Company’s subsidiaries include Quality Carriers, Inc. ("Quality Carriers"), CSX Intermodal Terminals, Inc. (“CSX Intermodal Terminals”), Total Distribution Services, Inc. (“TDSI”), TRANSFLO Terminal Services, Inc. (“TRANSFLO”), CSX Technology, Inc. (“CSX Technology”) and other subsidiaries. Quality Carriers is the largest provider of bulk liquid chemicals truck transportation in North America. CSX Intermodal Terminals owns and operates a system of intermodal terminals, predominantly in the eastern United States, and also provides drayage services (the pickup and delivery of intermodal shipments) for certain customers. TDSI serves the automotive industry with distribution centers and storage locations. TRANSFLO connects non-rail served customers to the many benefits of rail by transferring products from rail to trucks. The biggest TRANSFLO markets are chemicals and agriculture, which includes shipments of plastics and ethanol. CSX Technology and other subsidiaries provide support services for the Company.
Operating Model
The Company is focused on developing and strictly maintaining a scheduled service plan with an emphasis on improving customer service, optimizing assets and increasing employee engagement. When this operating model is executed effectively, the Company competes for additional business in the U.S. freight market. Further, this model leads to reduced costs and strong free cash flow generation.
CSX 2025 Form 10-K p.3
CSX CORPORATION
PART I
Lines of Business
During 2025, the Company's services generated $14.1 billion of revenue and served four primary lines of business: merchandise, intermodal, coal and trucking.
•The merchandise business shipped 2.6 million carloads (41% of volume) and generated $8.8 billion in revenue (62% of revenue) in 2025. The Company’s merchandise business is comprised of shipments in the following diverse markets: chemicals, agricultural and food products, automotive, minerals, forest products, metals and equipment, and fertilizers.
•The intermodal business shipped 3.0 million units (48% of volume) and generated $2.1 billion in revenue (15% of revenue) in 2025. The intermodal business combines the superior economics of rail transportation with the flexibility of trucks and offers a cost and environmental advantage over long-haul trucking. Through a network of approximately 30 terminals, the intermodal business serves all major markets east of the Mississippi River and transports mainly manufactured consumer goods in containers, providing customers with truck-like service for longer shipments.
•The coal business shipped 718 thousand carloads (11% of volume) and generated $1.9 billion in revenue (13% of revenue) in 2025. The Company transports domestic coal, coke and iron ore to electricity-generating power plants, steel manufacturers and industrial plants as well as export coal to deep-water port facilities. Most of the export coal the Company transports is used for steelmaking, while the majority of domestic coal the Company ships is used for electricity generation.
•The trucking business generated $816 million, or 6%, of revenue in 2025. Trucking revenue includes revenue from the operations of Quality Carriers.
Other revenue accounted for 4% of the Company’s total revenue in 2025. This category includes revenue from regional subsidiary railroads and incidental charges, including intermodal storage and equipment usage, demurrage and switching. Revenue from regional subsidiary railroads includes shipments by railroads that the Company does not directly operate. Intermodal storage represents charges for customer storage of containers at an intermodal terminal, ramp facility or offsite location beyond a specified period of time. Demurrage represents charges assessed when freight cars are held by a customer beyond a specified period of time. Switching represents charges assessed when a railroad switches cars for a customer or another railroad.
CSX's Committed Workforce
Most of the Company’s employees provide or support transportation services. The Company had approximately 23,000 employees as of December 2025, which includes approximately 16,900 employees that are members of a rail labor union and covered by national agreements with the Class I railroads or CSX-specific agreements. As of the date of this filing, new agreements with an effective date of January 1, 2025, have been fully ratified by most unions, representing nearly 75% of the Company's unionized workforce. The remaining unionized employees are covered under previous agreements while negotiations take place since collective agreements under the Railway Labor Act do not expire, but continue until amended or replaced.
CSX prioritizes workplace safety for employees and is committed to continued improvement through enhanced processes, training, technology, communication, and continuous collaboration with customers and peers across the railroad industry. Training programs and processes are focused on injury and accident prevention as well as emergency preparedness. Additionally, the attainment of key safety targets is a component of management's annual incentive program. The FRA Personal Injury Frequency Index, a measure of the number of FRA-reportable injuries per 200,000 man-hours, was 0.94 in 2025 and 1.23 in 2024.
CSX 2025 Form 10-K p.4
CSX CORPORATION
PART I
The Compensation and Talent Management Committee of the Board of Directors is responsible for the oversight of the Company's workforce and human capital management processes. The Company is committed to developing a culture that promotes workforce satisfaction and expects ethical behavior. The CSX Code of Ethics serves as a guiding standard for ethical behavior and covers many types of matters, including discrimination and harassment as well as safety. Annually, all management employees are required, and union employees are highly encouraged, to complete ethics training.
Company History
A leader in freight rail transportation for nearly 200 years, the Company’s heritage dates back to the early nineteenth century when The Baltimore and Ohio Railroad Company (“B&O”), the nation’s first common carrier, was chartered in 1827. Since that time, the Company has built on this foundation to create a railroad that could safely and reliably service the ever-increasing demands of a growing nation. Since its founding, numerous railroads have combined with the former B&O through merger and consolidation to create what has become CSX. Each of the railroads that combined into the CSX family brought new geographical reach to valuable markets, gateways, cities, ports and transportation corridors.
CSX Corporation was incorporated in 1978 under Virginia law. In 1980, the Company completed the merger of the Chessie System and Seaboard Coast Line Industries into CSX. The merger allowed the Company to connect northern population centers and Appalachian coal fields to growing southeastern markets. Later, the Company’s acquisition of key portions of Conrail, Inc. ("Conrail") allowed CSXT to link the northeast, including New England and the New York metropolitan area, with Chicago and midwestern markets as well as the growing areas in the Southeast already served by CSXT. This current rail network, which now includes the network acquired from Pan Am, allows the Company to directly serve every major market in the eastern United States with safe, dependable, environmentally responsible and fuel efficient freight transportation and intermodal service.
Competition
The business environment in which the Company operates is highly competitive. Shippers typically select transportation providers that offer the most compelling combination of service and price. Service requirements, both in terms of transit time and reliability, vary by shipper and commodity. As a result, the Company’s primary competition varies by commodity, geographic location and mode of available transportation and includes other railroads, motor carriers that operate similar routes across its service area and, to a less significant extent, barges, ships and pipelines.
CSXT’s primary rail competitor is Norfolk Southern Railway, which operates throughout much of the Company’s territory. During 2025, Norfolk Southern Railway entered into an agreement to merge with Union Pacific Railroad to form the nation's only transcontinental rail network, which requires the approval of the Surface Transportation Board. Other railroads also operate in parts of the Company’s territory. Depending on the specific market, competing railroads and deregulated motor carriers may exert pressure on price and service levels. For further discussion on the risk of competition to the Company, see Item 1A. Risk Factors.
CSX 2025 Form 10-K p.5
CSX CORPORATION
PART I
Regulatory Environment
The Company's operations are subject to various federal, state, provincial (Canada) and local laws and regulations generally applicable to businesses operating in the United States and Canada. In the U.S., the railroad operations conducted by the Company's subsidiaries, including CSXT, are subject to the regulatory jurisdiction of the Surface Transportation Board (“STB”), the Federal Railroad Administration (“FRA”), and its sister agency within the U.S. Department of Transportation ("DOT"), the Pipeline and Hazardous Materials Safety Administration (“PHMSA”). Together, FRA and PHMSA have broad jurisdiction over railroad operating standards and practices, including track, freight cars, locomotives and hazardous materials requirements. In addition, the U.S. Environmental Protection Agency (“EPA”) has regulatory authority with respect to matters that impact the Company's properties and operations.
The Transportation Security Administration (“TSA”), a component of the Department of Homeland Security, has broad authority over railroad operating practices that may have homeland security implications. In Canada, the railroad operations conducted by the Company’s subsidiaries, including CSXT, are subject to the regulatory jurisdiction of the Canadian Transportation Agency.
Although the Staggers Act of 1980 significantly deregulated the U.S. rail industry, the STB has broad jurisdiction over rail carriers. The STB regulates routes, fuel surcharges, conditions of service, rates for non-exempt traffic, acquisitions of control over rail common carriers and the transfer, extension or abandonment of rail lines, among other railroad activities. Any new rules from the STB regarding, among other things, competitive access or revenue adequacy could have a material adverse effect on the Company's financial condition, results of operations and liquidity as well as its ability to invest in enhancing and maintaining vital infrastructure. For further discussion on regulatory risks to the Company, see Item 1A. Risk Factors.
Financial Information
Information regarding the Company's results of operations and financial position can be found in Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Other Information
CSX makes available on its website www.csx.com, free of charge, its annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to those reports as soon as reasonably practicable after such reports are filed with or furnished to the Securities and Exchange Commission (“SEC”). The information on the CSX website is not part of this annual report on Form 10-K. Additionally, the Company has posted its code of ethics on its website, which is also available to any shareholder who requests it. This Form 10-K and other SEC filings made by CSX are also accessible through the SEC’s website at www.sec.gov.
CSX has included the certifications of its Chief Executive Officer (“CEO”) and the Chief Financial Officer (“CFO”) required by Section 302 of the Sarbanes-Oxley Act of 2002 (“the Act”) as Exhibit 31, as well as Section 906 of the Act as Exhibit 32 to this Form 10-K report.
For additional information concerning business conducted by the Company during 2025, see Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations.
CSX 2025 Form 10-K p.6
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Financial statements
data from SEC XBRL filings. Values are as-reported; restatements supersede originals. Values reported in .
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CSX CORPORATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FIRST QUARTER 2026 RESULTS
•Revenue increased $59 million, or 2%, year over year.
•Expenses decreased $153 million, or 6%, year over year.
•Operating income of $1.3 billion increased $212 million, or 20%, year over year.
•Operating margin of 36.0% improved 560 basis points versus the prior year.
•Earnings per diluted share of $0.43 increased $0.09, or 26%, year over year.
| First Quarters | ||||||||||||||||||||||||
| 2026 | 2025 | Fav / (Unfav) | % Change | |||||||||||||||||||||
Volume (in Thousands) | 1,559 | 1,518 | 41 | 3 | % | |||||||||||||||||||
| (in Millions) | ||||||||||||||||||||||||
| Revenue | $ | 3,482 | $ | 3,423 | $ | 59 | 2 | |||||||||||||||||
| Expense | 2,229 | 2,382 | 153 | 6 | ||||||||||||||||||||
| Operating Income | $ | 1,253 | $ | 1,041 | $ | 212 | 20 | % | ||||||||||||||||
| Operating Margin | 36.0 | % | 30.4 | % | 560 | bps | ||||||||||||||||||
| Earnings Per Diluted Share | $ | 0.43 | $ | 0.34 | $ | 0.09 | 26 | % | ||||||||||||||||
CSX Q1 2026 Form 10-Q p.29
CSX CORPORATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Volume and Revenue (Unaudited) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Volume (Thousands of Units); Revenue (Dollars in Millions); Revenue Per Unit (Dollars) | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| First Quarters | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Volume | Revenue | Revenue Per Unit | |||||||||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | % Change | 2026 | 2025 | % Change | 2026 | 2025 | % Change | |||||||||||||||||||||||||||||||||||||||||||||
| Chemicals | 168 | 166 | 1 | % | $ | 722 | $ | 698 | 3 | % | $ | 4,298 | $ | 4,205 | 2 | % | |||||||||||||||||||||||||||||||||||||
| Agricultural and Food Products | 116 | 115 | 1 | 409 | 408 | — | 3,526 | 3,548 | (1) | ||||||||||||||||||||||||||||||||||||||||||||
| Automotive | 87 | 87 | — | 275 | 271 | 1 | 3,161 | 3,115 | 1 | ||||||||||||||||||||||||||||||||||||||||||||
| Minerals | 82 | 79 | 4 | 192 | 181 | 6 | 2,341 | 2,291 | 2 | ||||||||||||||||||||||||||||||||||||||||||||
| Metals and Equipment | 65 | 65 | — | 220 | 209 | 5 | 3,385 | 3,215 | 5 | ||||||||||||||||||||||||||||||||||||||||||||
| Forest Products | 64 | 70 | (9) | 229 | 249 | (8) | 3,578 | 3,557 | 1 | ||||||||||||||||||||||||||||||||||||||||||||
| Fertilizers | 49 | 48 | 2 | 141 | 136 | 4 | 2,878 | 2,833 | 2 | ||||||||||||||||||||||||||||||||||||||||||||
| Total Merchandise | 631 | 630 | — | 2,188 | 2,152 | 2 | 3,468 | 3,416 | 2 | ||||||||||||||||||||||||||||||||||||||||||||
| Intermodal | 757 | 716 | 6 | 518 | 493 | 5 | 684 | 689 | (1) | ||||||||||||||||||||||||||||||||||||||||||||
| Coal | 171 | 172 | (1) | 458 | 461 | (1) | 2,678 | 2,680 | — | ||||||||||||||||||||||||||||||||||||||||||||
| Trucking | — | — | — | 202 | 202 | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
| Other | — | — | — | 116 | 115 | 1 | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
| Total | 1,559 | 1,518 | 3 | % | $ | 3,482 | $ | 3,423 | 2 | % | $ | 2,233 | $ | 2,255 | (1) | % | |||||||||||||||||||||||||||||||||||||
CSX Q1 2026 Form 10-Q p.30
CSX CORPORATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
First Quarter 2026
Revenue
Total revenue increased 2% in first quarter 2026 when compared to first quarter 2025 due to higher pricing in merchandise, volume growth in intermodal, higher domestic coal revenue, and increased fuel surcharge revenue. These increases were partially offset by a decrease in export coal revenue, including the impact of lower benchmark rates.
Merchandise Volume
Chemicals - Increased due to higher shipments of sand, petcoke, and waste, partially offset by lower shipments of crude oil.
Agricultural and Food Products - Increased due to higher shipments of feed ingredients and export grains, partially offset by decreased shipments of domestic feed grain, food and consumer products, and ethanol.
Automotive - Flat despite the impact of a temporary outage at a customer location associated with re-tooling efforts.
Minerals - Increased due to higher shipments of cement and salt.
Metals and Equipment - Flat as increased scrap and pipe shipments were offset by lower steel and aluminum shipments, which include the impact of customer plant closures.
Forest Products - Decreased due to lower shipments of pulp and paper products, which include the impacts of both customer plant closures and temporary outages, as well as lower shipments of building products.
Fertilizers - Increased due to higher short-haul phosphates shipments, partially offset by decreases in long-haul shipments.
Intermodal Volume
Domestic shipments increased due to wins with key customers and new service offerings. International shipments were relatively flat to prior year levels.
Coal Volume
Domestic coal increased due to higher shipments to utility plants, partially offset by lower shipments to river terminals. Export coal decreased due to lower shipments of metallurgical coal primarily as a result of weather impacts on the overall supply chain.
Trucking Revenue
Trucking revenue was flat to prior year results.
Other Revenue
Other revenue increased $1 million.
CSX Q1 2026 Form 10-Q p.31
CSX CORPORATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Expenses
Expenses of $2.2 billion decreased $153 million, or 6%, in first quarter 2026 when compared to the first quarter 2025.
Labor and Fringe expense decreased $9 million due to the following:
•Inflation increases of $41 million were almost entirely offset by efficiency savings, which were primarily driven by lower headcount.
•All other net costs decreased $10 million.
Purchased Services and Other expense decreased $158 million due to the following:
•Efficiency savings net of inflation were $50 million, driven by cost reductions across operating and support functions.
•Gains on property dispositions were $44 million in first quarter 2026 compared to no gains in the prior year.
•A decrease of $20 million was due to the effects of network disruptions and congestion in the prior year, which included higher locomotive usage costs and rerouting charges associated with the Howard Street Tunnel project.
•All other net costs decreased $44 million due to several non-significant items, roughly one-third of which relate to prior year costs that did not recur in the current year.
Depreciation and Amortization expense decreased $10 million primarily as a result of an equipment depreciation study.
Fuel costs increased $27 million primarily due to a 14% increase in locomotive fuel prices.
Equipment and Other Rents expense decreased $3 million.
Interest Expense
Interest expense increased $4 million primarily due to higher average debt balances.
Other Income - Net
Other income - net decreased $3 million primarily due to lower interest income.
Income Tax Expense
Income tax expense increased $44 million primarily due to higher earnings before income taxes.
CSX Q1 2026 Form 10-Q p.32
CSX CORPORATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Non-GAAP Measures - Unaudited
CSX reports its financial results in accordance with accounting principles generally accepted in the United States of America ("GAAP"). CSX also uses certain non-GAAP measures that fall within the meaning of Securities and Exchange Commission Regulation G and Regulation S-K Item 10(e), which may provide users of the financial information with additional meaningful comparison to prior reported results. Non-GAAP measures do not have standardized definitions and are not defined by GAAP. Therefore, CSX’s non-GAAP measures are unlikely to be comparable to similar measures presented by other companies. The presentation of these non-GAAP measures should not be considered in isolation from, as a substitute for, or as superior to the financial information presented in accordance with GAAP. Reconciliations of non-GAAP measures to corresponding GAAP measures are below.
Free Cash Flow
Management believes that Free Cash Flow ("FCF") is supplemental information useful to investors as it is important in evaluating the Company’s financial performance. More specifically, FCF measures cash generated by the business after reinvestment. This measure represents cash available for both equity and bond investors to be used for dividends, share repurchases or principal reduction on outstanding debt. FCF is calculated by using net cash from operations and adjusting for property additions and proceeds and advances from property dispositions. FCF should be considered in addition to, rather than a substitute for, cash provided by operating activities.
The increase in FCF before dividends from the prior year of $234 million is primarily due to higher net earnings and decreased property additions, partially offset by unfavorable working capital activities. Prior year property additions include $133 million related to rebuilding the Blue Ridge subdivision, which was reopened in September 2025.
The following table reconciles cash provided by operating activities (GAAP measure) to FCF before dividends (non-GAAP measure).
| Three Months | ||||||||
(Dollars in Millions) | 2026 | 2025 | ||||||
| Net cash provided by operating activities | $ | 1,272 | $ | 1,255 | ||||
| Property Additions | (543) | (719) | ||||||
| Proceeds and Advances from Property Dispositions | 64 | 23 | ||||||
| Free Cash Flow (before payment of dividends) | $ | 793 | $ | 559 | ||||
CSX Q1 2026 Form 10-Q p.33
CSX CORPORATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Operating Statistics (Estimated)
The Company is committed to continuous improvement in safety and service performance through training, innovation and investment. Training and safety programs are designed to prevent incidents that can adversely impact employees, customers and communities. Technological innovations that can detect and avoid many types of human factor incidents are designed to serve as an additional layer of protection for the Company's employees. Continued capital investment in the Company's assets, including track, bridges, signals, equipment and detection technology also supports safety performance.
In the first quarter of 2026, velocity and dwell both improved by 7% versus prior year. Carload trip plan performance improved by 7% and intermodal trip plan performance decreased by 2%. The Company continues to focus on operational improvements and executing the operating plan to deliver safe, reliable, and efficient service to customers.
The Federal Railroad Administration (“FRA”) personal injury frequency index of 0.81 in first quarter 2026 improved 13% compared to prior year and the FRA train accident rate of 2.44 improved 31%. Safety is a top priority at CSX, and the Company is committed to reducing risk and enhancing the overall safety of its employees, customers, and communities in which it operates.
| First Quarters | |||||||||||||||||||
| 2026 | 2025 | Improvement / (Deterioration) | |||||||||||||||||
| Operations Performance | |||||||||||||||||||
Train Velocity (Miles Per Hour) | 18.9 | 17.6 | 7 | % | |||||||||||||||
Dwell (Hours) | 10.7 | 11.5 | 7 | % | |||||||||||||||
| Cars Online | 123,804 | 132,200 | 6 | % | |||||||||||||||
| On-Time Originations | 73 | % | 68 | % | 7 | % | |||||||||||||
| On-Time Arrivals | 61 | % | 55 | % | 11 | % | |||||||||||||
| Carload Trip Plan Performance | 74 | % | 69 | % | 7 | % | |||||||||||||
| Intermodal Trip Plan Performance | 88 | % | 90 | % | (2) | % | |||||||||||||
| Fuel Efficiency | 0.97 | 0.99 | 2 | % | |||||||||||||||
Revenue Ton-Miles (Billions) | |||||||||||||||||||
| Merchandise | 32.6 | 32.3 | 1 | % | |||||||||||||||
| Coal | 8.5 | 8.4 | 1 | % | |||||||||||||||
| Intermodal | 7.5 | 7.1 | 6 | % | |||||||||||||||
| Total Revenue Ton-Miles | 48.6 | 47.8 | 2 | % | |||||||||||||||
Total Gross Ton-Miles (Billions) | 93.5 | 93.9 | — | % | |||||||||||||||
Safety | |||||||||||||||||||
| FRA Personal Injury Frequency Index | 0.81 | 0.93 | 13 | % | |||||||||||||||
| FRA Train Accident Rate | 2.44 | 3.56 | 31 | % | |||||||||||||||
Certain operating statistics are estimated and can continue to be updated as actuals settle. The methodology for calculating train velocity, dwell, cars online and trip plan performance differs from that used by the Surface Transportation Board. The Company will continue to report these metrics to the Surface Transportation Board using the prescribed methodology.
CSX Q1 2026 Form 10-Q p.34
CSX CORPORATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Key Performance Measures Definitions
Train Velocity - Average train speed between origin and destination in miles per hour (does not include locals, yard jobs, work trains or passenger trains). Train velocity measures actual train miles and times of a train movement on CSX's network.
Dwell - Average amount of time in hours between car arrival to and departure from the yard.
Cars Online - Average number of active freight rail cars on lines operated by CSX, excluding rail cars that are being repaired, in storage, those that have been sold, or private cars dwelling at a customer location more than one day.
On-Time Originations - Percent of scheduled road trains that depart the origin yard on-time or ahead of schedule.
On-Time Arrivals - Percent of scheduled road trains that arrive at the destination yard on-time to within two hours of scheduled arrival.
Carload Trip Plan Performance - Percent of measured cars (excludes unit trains and other non-scheduled service as well as empty automotive shipments) destined for a customer that complete their scheduled plan at or ahead of the original estimated time of arrival or interchange (as applicable).
Intermodal Trip Plan Performance - Percent of measured containers (excludes port shipments along with empty containers and other non-scheduled service) destined for a customer that complete their scheduled plan at or ahead of the original estimated time of arrival, notification or interchange (as applicable).
Fuel Efficiency - Gallons of locomotive fuel per 1,000 gross ton-miles.
Revenue Ton-Miles (RTM's) - The movement of one revenue-producing ton of freight over a distance of one mile.
Gross Ton-Miles (GTM's) - The movement of one ton of train weight over one mile. GTM's are calculated by multiplying total train weight by distance the train moved. Total train weight is comprised of the weight of the freight cars and their contents.
FRA Personal Injury Frequency Index - Number of FRA-reportable injuries per 200,000 man-hours.
FRA Train Accident Rate - Number of FRA-reportable train accidents per million train-miles.
CSX Q1 2026 Form 10-Q p.35
CSX CORPORATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
The following are material changes in the significant cash flows, sources of cash and liquidity, capital investments, consolidated balance sheets and working capital, which provide an update to the discussion included in CSX's most recent annual report on Form 10-K.
Material Changes in Significant Cash Flows
The following chart highlights the operating, investing and financing components of the net increases of $294 million and $206 million in cash and cash equivalents for the three months ended March 31, 2026, and March 31, 2025, respectively.
•The Company generated $17 million more cash from operating activities primarily resulting from higher cash-generating net earnings, mostly offset by unfavorable working capital activity.
•CSX used $80 million less cash for investing activities primarily due to lower property additions consistent with planned capital expenditures, as prior year included $133 million related to rebuilding the Blue Ridge subdivision. Partially offsetting this decrease, the Company purchased short-term investments in 2026.
•The Company used $9 million more cash for financing activities as reduced cash from debt issuance was mostly offset by lower share repurchases.
CSX Q1 2026 Form 10-Q p.36
CSX CORPORATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Sources of Cash and Liquidity and Uses of Cash
As of the end of first quarter 2026, CSX had $1.1 billion of cash, cash equivalents and short-term investments. CSX uses current cash balances for general corporate purposes, which may include capital expenditures, working capital requirements, reduction or refinancing of outstanding indebtedness, redemptions and repurchases of CSX common stock, dividends to shareholders, acquisitions and other business opportunities, and contributions to the Company's qualified pension plan. See Note 7, Debt and Credit Agreements.
The Company has multiple sources of liquidity, including cash generated from operations and financing sources. The Company filed a shelf registration statement with the SEC on February 27, 2025, which may be used to issue debt or equity securities at CSX’s discretion, subject to market conditions and CSX Board authorization. While CSX seeks to give itself flexibility with respect to cash requirements, there can be no assurance that market conditions would permit CSX to sell such securities on acceptable terms at any given time, or at all. During the three months ended March 31, 2026, CSX did not issue any long-term debt.
CSX has a $1.2 billion unsecured, revolving credit facility backed by a diverse syndicate of banks that expires in February 2028. At March 31, 2026, the Company had no outstanding balances under this facility. The Company also has a commercial paper program, backed by the revolving credit facility, under which the Company may issue unsecured short-term commercial paper notes up to a maximum aggregate principal amount of $1.0 billion outstanding at any time. At March 31, 2026, the Company had no debt outstanding under the commercial paper program.
Planned capital investments for 2026 are expected to be less than $2.4 billion. Spending to sustain core infrastructure with a focus on safety and reliability will remain a top priority. In addition, management is committed to investments that promote profitable growth, including projects supporting service enhancements and productivity initiatives, which includes investments in locomotives and freight cars. CSX intends to fund capital investments primarily through cash generated from operations.
CSX Q1 2026 Form 10-Q p.37
CSX CORPORATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Material Changes in the Consolidated Balance Sheets and Working Capital
Total assets increased $550 million from year end primarily due to the $434 million increase in cash and short-term investments and an $89 million increase in accounts receivable commensurate with increased revenue at the end of the quarter.
Total liabilities increased $129 million from year end primarily due to a $176 million increase in income and other taxes payable and a $73 million increase in interest payable on long-term debt, both driven by the timing of payments. These increases were partially offset by a $118 million decrease in labor and fringe benefits payable, which includes the payout of incentive compensation. Total shareholders' equity increased $421 million from year end primarily driven by net earnings of $807 million, partially offset by dividends paid of $260 million and share repurchases of $222 million.
Working capital is considered a measure of a company's ability to meet its short-term needs. CSX had a working capital deficit of $110 million as of March 31, 2026, and $583 million as of December 31, 2025. This working capital improvement of $473 million since year end was primarily driven by a $294 million increase in cash and cash equivalents, as noted above, and a $140 million increase in short-term investments. The Company's working capital balance varies due to factors such as the timing of scheduled debt payments and changes in cash and cash equivalent balances as discussed above. The Company continues to maintain adequate liquidity to satisfy current liabilities and maturing obligations when they come due. CSX has sufficient financial capacity, including its revolving credit facility, commercial paper program and shelf registration statement to manage its day-to-day cash requirements and any anticipated obligations. The Company from time to time accesses the credit markets for additional liquidity.
CSX is committed to returning cash to shareholders and maintaining an investment-grade credit profile. Capital structure, capital investments and cash distributions, including dividends and share repurchases, are reviewed at least annually by the Board of Directors. Management's assessment of market conditions and other factors guides the timing and volume of repurchases. Future share repurchases are expected to be funded by cash on hand, cash generated from operations and debt issuances.
This discussion should be read in conjunction with our Condensed Consolidated Financial Statements and the related notes that appear elsewhere in this document.
LABOR AGREEMENTS
Approximately 16,700 of the Company's approximately 22,200 employees are members of a rail labor union and covered by national agreements with the Class I railroads or CSX-specific agreements. Agreements with an effective date of January 1, 2025, have been fully ratified by most unions, representing nearly 75% of the Company's unionized workforce. The remaining unionized employees are covered under previous agreements while negotiations take place since collective agreements under the Railway Labor Act do not expire, but continue until amended or replaced.
CSX Q1 2026 Form 10-Q p.38
CSX CORPORATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
CRITICAL ACCOUNTING ESTIMATES
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires that management make estimates in reporting the amounts of certain assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and certain revenues and expenses during the reporting period. Actual results may differ from those estimates. These estimates and assumptions are discussed with the Audit Committee of the Board of Directors on a regular basis. Consistent with the prior year, significant estimates using management judgment are made for the areas below. For further discussion of CSX's critical accounting estimates, see the Company's most recent annual report on Form 10-K.
•personal injury and environmental reserves;
•pension plan accounting; and
•depreciation policies for assets under the group-life method.
FORWARD-LOOKING STATEMENTS
Certain statements in this report and in other materials filed with the Securities and Exchange Commission, as well as information included in oral statements or other written statements made by the Company, are forward-looking statements. The Company intends for all such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and the provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements within the meaning of the Private Securities Litigation Reform Act may contain, among others, statements regarding:
•projections and estimates of earnings, revenues, margins, volumes, rates, cost-savings, expenses, taxes or other financial items;
•expectations as to results of operations and operational initiatives;
•expectations as to the effect of claims, lawsuits, environmental costs, commitments, contingent liabilities, labor negotiations or agreements on the Company's financial condition, results of operations or liquidity;
•management's plans, strategies and objectives for future operations, capital expenditures, workforce levels, dividends, share repurchases, safety and service performance, proposed new services and other matters that are not historical facts, and management's expectations as to future performance and operations and the time by which objectives will be achieved; and
•future economic, industry or market conditions or performance and their effect on the Company's financial condition, results of operations or liquidity.
Forward-looking statements are typically identified by words or phrases such as “will,” “should,” “believe,” “expect,” “anticipate,” “project,” “estimate,” “preliminary” and similar expressions. The Company cautions against placing undue reliance on forward-looking statements, which reflect its good faith beliefs with respect to future events and are based on information currently available to it as of the date the forward-looking statement is made. Forward-looking statements should not be read as a guarantee of future performance or results and will not necessarily be accurate indications of the timing when, or by which, such performance or results will be achieved.
CSX Q1 2026 Form 10-Q p.39
CSX CORPORATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Forward-looking statements are subject to a number of risks and uncertainties and actual performance or results could differ materially from those anticipated by any forward-looking statements. The Company undertakes no obligation to update or revise any forward-looking statement. If the Company does update any forward-looking statement, no inference should be drawn that the Company will make additional updates with respect to that statement or any other forward-looking statements. The following important factors, in addition to those discussed in Part I, Item 1A. Risk Factors of CSX's most recent annual report on Form 10-K and elsewhere in this report, may cause actual results to differ materially from those contemplated by any forward-looking statements:
•legislative, regulatory or legal developments involving transportation, including rail or intermodal transportation, the environment, hazardous materials, taxation, international trade and initiatives to further regulate the rail industry;
•the outcome of litigation, claims and other contingent liabilities, including, but not limited to, those related to fuel surcharge, environmental matters, taxes, shipper and rate claims subject to adjudication, personal injuries and occupational illnesses;
•changes in domestic or international economic, political or business conditions, including those directly affecting the transportation industry (such as the impact of industry competition, conditions, performance and consolidation, as well as the impact of international trade agreements and tariffs) and those affecting the level of demand for products carried by CSXT or by truck, which could impact the performance and value of the Company's rail and trucking-related investments;
•natural events such as severe weather conditions, including floods, fire, hurricanes and earthquakes, a pandemic crisis affecting the health of the Company's employees, its shippers or the consumers of goods, or other unforeseen disruptions of the Company's operations, systems, property, equipment or supply chain;
•competition from other modes of freight transportation, such as trucking, and competition and consolidation or financial distress within the transportation industry generally;
•the cost of compliance with laws and regulations that differ from expectations as well as costs, penalties and operational and liquidity impacts associated with noncompliance with applicable laws or regulations;
•the impact of increased passenger activities in capacity-constrained areas, including potential effects of high speed rail initiatives, or regulatory changes affecting when CSXT can transport freight or service routes;
•unanticipated conditions in the financial markets that may affect timely access to capital markets and the cost of capital, as well as management's decisions regarding share repurchases;
•changes in fuel prices, surcharges for fuel and the availability of fuel;
•the impact of natural gas prices on coal-fired electricity generation;
•the impact of global supply and price of seaborne coal on CSX's export coal market;
•availability of insurance coverage at commercially reasonable rates or insufficient insurance coverage to cover claims or damages;
•the inherent business risks associated with safety and security, including the transportation of hazardous materials or a cybersecurity attack which would threaten the availability and reliability of information technology;
•adverse economic or operational effects from actual or threatened war or terrorist activities and any governmental response;
•loss of key personnel or the inability to hire and retain qualified employees;
CSX Q1 2026 Form 10-Q p.40
CSX CORPORATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
•labor and benefit costs and labor difficulties, including stoppages affecting either the Company's operations or customers' ability to deliver goods to the Company for shipment;
•the Company's success in implementing its strategic, financial and operational initiatives, including acquisitions;
•the impact of conditions in the real estate market on the Company's ability to sell assets;
•
Recent insider activity
| Date | Insider | Role | Action | Shares | Price | Value |
|---|---|---|---|---|---|---|
| 2026-06-03 | Boone Kevin S. | EVP & CFO | Sell | -136,708 | $46.70 | -$6,384,264 |
| 2026-06-03 | ZILLMER JOHN J | Director | Sell | -10,000 | $46.45 | -$464,500 |
Source: SEC Form 4 filings.
Next expected filings
- ~2026-07-22 10-Q expected by 2026-08-11 (in 37 days)
- ~2026-10-15 10-Q expected by 2026-11-04 (in 122 days)
- ~2027-02-11 10-K expected by 2027-02-27 (in 241 days)
- ~2027-04-21 10-Q expected by 2027-05-11 (in 310 days)
Predicted from historical filing cadence; not an SEC commitment.
Recent SEC filings
- 2026-05-14 8-K Officer/Director Change; Shareholder Vote Results; Other Events
- 2026-04-22 10-Q Quarterly Report
- 2026-04-22 8-K Earnings Release; Financial Statements and Exhibits
- 2026-02-12 10-K Annual Report
- 2026-01-22 8-K Earnings Release; Financial Statements and Exhibits
- 2025-10-29 8-K Officer/Director Change; Regulation FD Disclosure; Other Events; Financial Statements and Exhibits
- 2025-10-23 8-K Material Financial Obligation; Other Events; Financial Statements and Exhibits
- 2025-10-22 8-K Material Agreement Entered; Financial Statements and Exhibits
- 2025-10-16 10-Q Quarterly Report
- 2025-10-16 8-K Earnings Release; Financial Statements and Exhibits
- 2025-09-29 8-K Officer/Director Change; Regulation FD Disclosure; Financial Statements and Exhibits
- 2025-07-23 10-Q Quarterly Report
- 2025-07-23 8-K Earnings Release; Financial Statements and Exhibits
- 2025-04-16 10-Q Quarterly Report
- 2025-04-16 8-K Earnings Release; Financial Statements and Exhibits