10-QPeriod: Q2 FY2026

CSX CORP Quarterly Report for Q2 Ended Jun 30, 2026

Filed July 22, 2026For Securities:CSX

Summary

CSX Corporation reported strong financial performance for the second quarter and the first six months of 2026. Revenue saw a significant 10% increase year-over-year for the quarter, reaching $3.935 billion, driven by higher volumes and pricing across merchandise, intermodal, and coal segments, boosted by increased fuel surcharges. Expenses grew by 6%, largely due to a substantial increase in fuel costs, but overall operating income surged by 17% to $1.506 billion, with operating margins improving by 240 basis points to 38.3%. Net earnings for the second quarter rose to $1.002 billion, a notable increase from $829 million in the prior year, translating to a 23% jump in diluted earnings per share to $0.54. For the first six months of the year, net earnings were $1.809 billion, up from $1.475 billion. The company also demonstrated improved operational efficiency, with increased train velocity and improved safety metrics, such as a significant reduction in the FRA train accident rate. Cash flow from operations strengthened considerably, and while capital expenditures were lower than the previous year due to the completion of infrastructure projects, the company maintained robust liquidity.

Key Highlights

  • 1Revenue increased by 10% year-over-year in Q2 2026, reaching $3.935 billion, driven by higher volumes, pricing, and fuel surcharges.
  • 2Operating income saw a significant 17% increase, reaching $1.506 billion, with operating margins improving to 38.3%.
  • 3Net earnings for Q2 2026 rose to $1.002 billion, an increase of 21% from $829 million in Q2 2025.
  • 4Diluted Earnings Per Share (EPS) grew by 23% to $0.54 in Q2 2026 compared to $0.44 in the prior year.
  • 5Cash flow from operating activities for the six months ended June 30, 2026, increased by $709 million year-over-year, largely due to higher earnings and favorable working capital changes.
  • 6Safety performance improved, with the FRA Personal Injury Frequency Index decreasing by 19% and the FRA Train Accident Rate improving by 30% year-over-year in Q2 2026.
  • 7The company continues to prioritize returning capital to shareholders, with a substantial share repurchase program in place and an 8% increase in quarterly cash dividends authorized in February 2026.

Frequently Asked Questions

The 10% increase in revenue to $3.935 billion was primarily driven by higher fuel surcharge revenue, increased shipping volumes across merchandise, intermodal, and coal segments, and improved pricing. Specific merchandise segments like Chemicals, Agricultural and Food Products, and Metals and Equipment showed strong growth, while Intermodal volume also saw a significant boost.

Total expenses increased by 6% to $2.429 billion in Q2 2026, primarily due to a substantial 74% increase in locomotive fuel prices. However, CSX achieved a 6% increase in total non-fuel expenses, driven by efficiency savings in purchased services and other, lower headcount, and favorable adjustments from network disruptions, which partially offset inflationary pressures.

CSX remains committed to returning cash to shareholders. They authorized an 8% increase in their quarterly cash dividend to $0.14 per share in February 2026. Additionally, they have a significant share repurchase program, with $5.7 billion in repurchase authority remaining as of June 30, 2026. Future capital investments are planned to be funded primarily through cash generated from operations.

Operational efficiency showed improvement with a 3% increase in train velocity and a 4% increase in total revenue ton-miles for Q2 2026. Safety metrics also saw positive trends, with the FRA Personal Injury Frequency Index improving by 19% and the FRA Train Accident Rate decreasing by 30% compared to the prior year, underscoring a focus on safe and reliable operations.