CSX CORP

Previous wording

•Expenses decreased $153 million, or 6%, year over year.

Current wording

•Expenses increased $138 million, or 6%, year over year.

Previous wording

•Operating margin of 36.0% improved 560 basis points versus the prior year.

Current wording

•Operating margin of 38.3% improved 240 basis points versus the prior year.

Previous wording

•Earnings per diluted share of $0.43 increased $0.09, or 26%, year over year.

Current wording

•Earnings per diluted share of $0.54 increased $0.10, or 23%, year over year.

Previous wording

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.

Current wording

Agricultural and Food Products - Increased due to higher shipments of export grains and domestic feed ingredients, partially offset by decreased shipments of domestic feed grain.

Previous wording

Minerals- Increased due to higher shipments of cement and salt.

Current wording

Minerals - Increased due to higher shipments of cement and aggregates.

Previous wording

Automotive - Flat despite the impact of a temporary outage at a customer location associated with re-tooling efforts.

Current wording

Automotive - Decreased due to the impact of a temporary outage at a customer location associated with re-tooling efforts.

Previous wording

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.

Current wording

Metals and Equipment - Increased primarily due to higher pipe and scrap shipments, partially offset by lower steel shipments, which includes the impact of customer plant closures.

Previous wording

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.

Current wording

Forest Products - Flat as higher lumber shipments, including benefits from a tighter trucking environment, were offset by lower shipments of pulp and paper products, which include the impacts of both customer plant closures and temporary outages.

Previous wording

Fertilizers - Increased due to higher short-haul phosphates shipments, partially offset by decreases in long-haul shipments.

Current wording

Fertilizers - Increased due to higher short-haul phosphates shipments.

Previous wording

Domestic shipments increased due to wins with key customers and new service offerings. International shipments were relatively flat to prior year levels.

Current wording

Domestic shipments increased due to wins with key customers, new service offerings and a tightening truck environment. International shipments were relatively flat to prior year levels.

Previous wording

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.

Current wording

Export coal increased due to higher shipments of metallurgical and thermal coal, including the benefits of increased production from re-opened mines. Domestic coal decreased due to lower shipments to utility plants, partially offset by higher shipments to steel manufacturing locations and lake terminals.

Previous wording

Labor and Fringe expense decreased $9 million due to the following:

Current wording

Labor and Fringe expense increased $40 million due to the following:

Previous wording

•All other net costs decreased $10 million.

Current wording

•All other net costs decreased $48 million primarily due to lower headcount.

Previous wording

Purchased Services and Other expense decreased $158 million due to the following:

Current wording

Purchased Services and Other expense decreased $66 million due to the following:

Previous wording

•Efficiency savings net of inflation were $50 million, driven by cost reductions across operating and support functions.

Current wording

•Efficiency savings, net of inflation, of $54 million were driven by cost reductions across operating and support functions.

Previous wording

•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.

Current wording

•A decrease of $14 million was due to the effects of network disruptions and congestion in the prior year, including rerouting impacts.

Previous wording

Depreciation and Amortization expense decreased $10 million primarily as a result of an equipment depreciation study.

Current wording

Depreciation and Amortization expense decreased $16 million primarily as a result of an equipment depreciation study.

Previous wording

Fuel costs increased $27 million primarily due to a 14% increase in locomotive fuel prices.

Current wording

Fuel costs increased $177 million primarily due to a 74% increase in locomotive fuel prices as well as higher non-locomotive fuel prices, partially offset by efficiency savings.

Previous wording

Equipment and Other Rents expense decreased $3 million.

Current wording

Equipment and Other Rents expense increased $3 million.

Previous wording

Income tax expense increased $44 million primarily due to higher earnings before income taxes.

Current wording

Income tax expense increased $54 million primarily due to higher earnings before income taxes.

Previous wording

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.

Current wording

The increase in FCF before dividends of $1.2 billion from the prior year is primarily due to prior year payments of previously postponed taxes, decreased property additions driven by completion of the Blue Ridge subdivision rebuild, and higher cash-generating net earnings. Prior year property additions include approximately $295 million related to rebuilding the Blue Ridge subdivision, which was reopened in September 2025.

Previous wording

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.

Current wording

In the second quarter of 2026, velocity improved by 3% while dwell increased by 6% versus prior year. Carload trip plan performance decreased by 5% 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.

Previous wording

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.

Current wording

The Federal Railroad Administration (“FRA”) personal injury frequency index of 0.83 in second quarter 2026 improved 19% compared to prior year and the FRA train accident rate of 2.72 improved 30%. 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.

Previous wording

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.

Current wording

The following chart highlights the operating, investing and financing components of the net increase of $337 million and decrease of $546 million in cash and cash equivalents for the six months ended June 30, 2026, and June 30, 2025, respectively.

Previous wording

•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.

Current wording

•CSX used $133 million less cash for investing activities primarily due to lower property additions following the completion of the rebuilding of the Blue Ridge subdivision in prior year and increased proceeds from property dispositions in the current year. The decrease was partially offset by net purchases of short-term investments in 2026.

Previous wording

•The Company used $9 million more cash for financing activities as reduced cash from debt issuance was mostly offset by lower share repurchases.

Current wording

•The Company used $41 million less cash for financing activities as lower share repurchases were mostly offset by reduced cash from debt issuance.

Previous wording

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.

Current wording

As of the end of second quarter 2026, CSX had $1.4 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.

Previous wording

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.

Current wording

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 six months ended June 30, 2026, CSX did not issue any long-term debt.

Previous wording

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.

Current wording

Total assets increased $1.0 billion from year end primarily due to $715 million increase in cash and short-term investments, a $158 million increase in accounts receivable commensurate with increased revenue, and a $135 million increase in net property consistent with planned capital expenditures.

Previous wording

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.

Current wording

Total liabilities increased $116 million from year end primarily due to an $86 million increase in deferred income taxes primarily driven by bonus tax depreciation and a $70 million increase in income and other taxes payable due to increased earnings and the timing of tax payments. Total shareholders' equity increased $928 million from year end primarily driven by net earnings of $1.8 billion, partially offset by dividends paid of $520 million and share repurchases of $506 million.

Previous wording

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.

Current wording

Working capital is considered a measure of a company's ability to meet its short-term needs. CSX had a working capital deficit of $746 million as of June 30, 2026, and $583 million as of December 31, 2025. This deficit increase of $163 million since year end was primarily driven by a $1.0 billion reclass of long-term debt to current and a $70 million increase in income and other taxes payable. These increases were partially offset by a $715 million increase in cash and short-term investments as noted above and a $158 million increase in accounts receivable. 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.

Previous wording

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.

Current wording

Approximately 16,600 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.

Previous wording

•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;

Current wording

•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, including impacts to the performance and value of the Company's rail and trucking-related investments;

Previous wording

•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;

Current wording

•the inherent business risks associated with safety and security, including the transportation of hazardous materials and cybersecurity incidents compromising the security, stability, availability, or reliability of information technology systems or data;