AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-2: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 3/6 · 18/10/2026
Moat63
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
structural advantage · 3/4 · The extensive operating rail network, terminals and customer connections demonstrate a strong structural asset base supporting efficient scale. Entry costs and route exclusivity are not quantified; margins alone are not the basis.
durability · 3/4 · Existing infrastructure and long-term right-of-way rights support durable service capability. Large reinvestment requirements and shared access prevent an exceptional rating or guaranteed duration.
customer dependency · 2/4 · Customer track connections support switching friction, but dependency is inferred from physical integration. Shared infrastructure and transloading flexibility limit captivity; customer-specific alternatives are undisclosed.
erosion resilience · 2/4 · First-half 2026 volume and earnings improvement demonstrates recovery, but realized disruption costs, reconstruction spending and declining coal-fired generation show material vulnerabilities. Regulatory risks are possibilities rather than realized erosion.
Pricing power—
Insufficient evidence for every rubric criterion; no category score is inferred.
realized pricing · 3/4 · Reported merchandise pricing gains in 2025 and price growth across merchandise, intermodal and coal in first-half 2026 establish realized pricing power. Revenue-per-unit gains corroborate outcomes but include fuel and mix; export coal benchmark weakness limits breadth.
retention · 2/4 · Assessed indirectly from customer connections and operating demand: first-half 2026 total volume rose 4% alongside reported pricing growth. Earlier merchandise weakness and mixed segment volumes temper the result. Aggregate demand does not identify retained customers or a retention rate.
margin resilience · 2/4 · First-half 2026 operating margin recovered to 37.2% from 33.2%, despite fuel and inflation pressures. However, 2025 operating income declined and costs rose; property gains and recovery from disruptions also contributed to improvement. Pricing alone cannot explain resilience.
contractual freedom · — · Actual pricing gains demonstrate outcomes, but customer repricing rights and contractual constraints are undisclosed. The existing hazardous-material service mandate constrains service obligations, not demonstrably pricing discretion; possible future price constraints do not establish present contract terms.
Predictability76
Five consecutive annual periods. Equal weights: nondeclining revenue frequency; revenue-growth volatility (5–40pp); positive FCF frequency; FCF-margin volatility (3–20pp). Stability indicator, not a growth forecast.
- Nondeclining revenue years (%)
- 25.00
- Revenue growth volatility (pp)
- 8.85
- Positive FCF years (%)
- 100.00
- FCF margin volatility (pp)
- 4.90
Financial strength—
Missing required inputs: netDebtEbitGrade. Equal-weight grades: debt/FCF (1–8x), net debt/earnings before interest and tax (0–5x), interest service (1–12x), current ratio (0.75–2x). Earnings use reported operating income, or reported pretax profit plus reported interest expense when operating income is unavailable. Interest service uses earnings/interest expense; if unavailable, it uses reported operating cash flow/cash interest paid, without relabeling cash paid as accrued expense. Nonpositive cash flow/earnings score 0 for their service component; reported zero interest with a positive numerator scores 100. Net cash scores 100 for net leverage. Missing disclosures remain unavailable. General nonfinancial-company rubric, not a credit rating; exceptional and nonoperating gains are not normalized out. IFRS finance-cost and cash-flow classifications retain their reported scope.
- debtFcfGrade
- 0.00
- interestCoverageGrade
- 39.61
- currentRatioGrade
- 5.11
- Debt / FCF (x)
- 11.03
- Interest coverage (x)
- 5.36
- Current ratio (x)
- 0.81
Capital allocation—
Missing required inputs: operatingReturn. Three-year equal-weight indicators: pretax return on average invested capital (0–25%; equity + debt − cash, each year and its prior year), share-count growth (0–5%, lower better), share-based cost/revenue (2–20%, lower better), consolidated FCF/net income (0–1x). Return uses reported operating income or, if unavailable, EBIT calculated from reported pretax profit plus reported interest expense; exceptional/nonoperating gains are not normalized out. Share-based cost uses the reported cash-flow add-back or, if absent, separately reported recognized compensation expense; the latter never becomes an FCF adjustment. Nonpositive net income scores 0 for cash conversion; absent income/FCF stays unavailable. Nonpositive invested capital has no defined return and remains unavailable. Does not establish acquisition quality or buyback timing.
- 3-year average dilution (%)
- -4.33
- 3-year average SBC / revenue (%)
- 0.36
- cashConversionGrade
- 76.40
Management63
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 2/4 · Operating cash funded property additions in 2023–2025, but 2025 cash generation fell to $4.613 billion while property additions reached $2.902 billion and repurchases plus dividends totaled $2.368 billion. Cash declined and debt issuance exceeded repayments. Repeated trucking goodwill impairments weaken acquisition outcomes; first-half 2026 had no long-term debt issuance.
incentive alignment · 3/4 · The adopted and granted 2026–2028 LTIP links performance-unit vesting over approximately three years to ROIC at 60% and relative shareholder return at 40%, with stock settlement. These are actual awards, not proposals. Ownership guidelines and anti-hedging policies support alignment, although ownership compliance and eventual vesting outcomes are not established.
execution · 2/4 · Realized efficiency savings and first-half 2026 volume and earnings improvement support execution indirectly through operating results. They follow weaker 2025 results and disruption costs. Management reports on-schedule project completion, but anticipated double-stack growth is not a demonstrated outcome and specific service-reliability results are missing.
governance · 3/4 · Disclosed existing practices include an independent chair, annual elections, majority voting, independent committees and shareholder meeting rights. Actual 2025 Audit Committee independence and no defined related person transactions support strong governance. These issuer disclosures do not establish exceptional oversight effectiveness or subsequent election results.
Evidence
(“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.
Business / CSXT network footprint · Filed 12/02/2026
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.
Business / production and distribution facility connections · Filed 12/02/2026
Louis, Columbus and Chicago. CSXT’s track structure includes mainline track, which connects terminals and yards, track within terminals and switching yards, sidings used for passing trains, track connecting CSXT's track to customer locations and turnouts that divert trains from one track to another.
Properties / track connections to customer locations · Filed 12/02/2026
At December 2025, the breakdown of track miles was as follows: Track Miles Single Mainline Track 19,739 Other Mainline Track 5,648 Terminals and Switching Yards 9,243 Passing Sidings and Turnouts 888 Total 35,518 In addition to its physical track structure, the Company operates numerous yards and terminals for rail and intermodal service.
Properties / December 2025 track miles and terminals · Filed 12/02/2026
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.
Business / intermodal terminal network · Filed 12/02/2026
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.
Business / issuer assertion of intermodal cost advantage · Filed 12/02/2026
The Company has various lease agreements with other parties with terms up to 50 years, including a significant operating lease with the State of Georgia for approximately 137 miles of right-of-way with integral track assets for a term of 50 years with an annual 2.5% increase.
Note 7 / long-term right-of-way lease · Filed 12/02/2026
•An increase of $53 million was due to the effects of network disruptions and congestion, primarily driven by work on the Howard Street tunnel and severe winter weather.
MD&A / realized network disruption and congestion costs · Filed 12/02/2026
Capital expenditures above include approximately $470 million and $50 million in 2025 and 2024, respectively, related to rebuilding the Blue Ridge subdivision as a result of impacts from Hurricane Helene.
MD&A / Blue Ridge reconstruction capital expenditures · Filed 12/02/2026
and global energy markets, including the impacts of regulation and alternative fuel sources, have resulted in lower energy production from coal-fired power plants in CSX's service territory.
Risk factors / realized decline in coal-fired generation · Filed 12/02/2026
In addition, statutes, regulations, orders or other governmental actions that, among other things, impose price constraints, restrict access to government funding, or affect rail-to-rail competition could adversely affect the Company's profitability.
Risk factors / possible price constraints and rail competition changes · Filed 12/02/2026
Conrail owns rail infrastructure and operates for the joint benefit of CSX and NS.
Note 15 / shared infrastructure operated for CSX and NS · Filed 27/02/2025
These serve as points of connectivity between the Company and its local customers and as sorting facilities where railcars and intermodal containers are received, classed for destination and placed onto outbound trains, or arrive and are delivered to the customer.
Properties / customer connectivity and terminal functions · Filed 12/02/2026
Second Quarters Six Months 2026 2025 Fav / (Unfav) % Change 2026 2025 Fav / (Unfav) % Change Volume (in Thousands) 1,676 1,580 96 6 % 3,235 3,098 137 4 % (in Millions) Revenue $ 3,935 $ 3,574 $ 361 10 $ 7,417 $ 6,997 $ 420 6 Expense 2,429 2,291 (138) (6) 4,658 4,673 15 — Operating Income $ 1,506 $ 1,283 $ 223 17 % $ 2,759 $ 2,324 $ 435 19 % Operating Margin 38.3 % 35.9 % 240 bps 37.2 % 33.2 % 400 bps Earnings Per Diluted Share $ 0.54 $ 0.44 $ 0.10 23 % $ 0.97 $ 0.78 $ 0.19 24 % CSX Q2 2026 Form 10-Q p.31 Table of Contents CSX CORPORATION ITEM 2.
MD&A / second-quarter and six-month operating results · Filed 22/07/2026
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) Second Quarters Volume Revenue Revenue Per Unit 2026 2025 % Change 2026 2025 % Change 2026 2025 % Change Chemicals 177 164 8 % $ 774 $ 701 10 % $ 4,373 $ 4,274 2 % Agricultural and Food Products 119 117 2 444 418 6 3,731 3,573 4 Minerals 105 99 6 242 218 11 2,305 2,202 5 Automotive 102 103 (1) 332 320 4 3,255 3,107 5 Metals and Equipment 72 70 3 256 224 14 3,556 3,200 11 Forest Products 70 70 — 266 250 6 3,800 3,571 6 Fertilizers 50 47 6 132 126 5 2,640 2,681 (2) Total Merchandise 695 670 4 2,446 2,257 8 3,519 3,369 4 Intermodal 792 729 9 620 491 26 783 674 16 Coal 189 181 4 520 477 9 2,751 2,635 4 Trucking — — — 226 211 7 — — — Other — — — 123 138 (11) — — — Total 1,676 1,580 6 % $ 3,935 $ 3,574 10 % $ 2,348 $ 2,262 4 % Six Months Volume Revenue Revenue Per Unit 2026 2025 % Change 2026 2025 % Change 2026 2025 % Change Chemicals 345 330 5 % $ 1,496 $ 1,399 7 % $ 4,336 $ 4,239 2 % Agricultural and Food Products 235 232 1 853 826 3 3,630 3,560 2 Minerals 187 178 5 434 399 9 2,321 2,242 4 Automotive 189 190 (1) 607 591 3 3,212 3,111 3 Metals and Equipment 137 135 1 476 433 10 3,474 3,207 8 Forest Products 134 140 (4) 495 499 (1) 3,694 3,564 4 Fertilizers 99 95 4 273 262 4 2,758 2,758 — Total Merchandise 1,326 1,300 2 4,634 4,409 5 3,495 3,392 3 Intermodal 1,549 1,445 7 1,138 984 16 735 681 8 Coal 360 353 2 978 938 4 2,717 2,657 2 Trucking — — — 428 413 4 — — — Other — — — 239 253 (6) — — — Total 3,235 3,098 4 % $ 7,417 $ 6,997 6 % $ 2,293 $ 2,259 2 % CSX Q2 2026 Form 10-Q p.32 Table of Contents CSX CORPORATION ITEM 2.
MD&A / volume, revenue and revenue per unit by business · Filed 22/07/2026
TRANSFLO connects non-rail served customers to the many benefits of rail by transferring products from rail to trucks.
Business / transloading for customers without rail service · Filed 12/02/2026
Forest Products – Decreased due to lower shipments of building products, as well as lower shipments of pulp and paper products which includes the impact of both temporary outages and customer plant closures.
MD&A / forest products demand and customer plant closures · Filed 12/02/2026
Total revenue decreased by $448 million in 2025, or 3%, when compared to the previous year primarily due to declines in export coal revenue, which includes the impact of lower global benchmark rates, lower merchandise volume, and lower fuel recovery.
MD&A / 2025 revenue decline and contributing factors · Filed 12/02/2026
These decreases were partially offset by pricing gains in merchandise and higher intermodal volume.
MD&A / realized merchandise pricing gains and intermodal volume growth · Filed 12/02/2026
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Six Months Results of Operations Revenue increased $420 million primarily due to volume and price growth in merchandise, intermodal and coal as well as higher fuel recovery.
MD&A / six-month price, volume and fuel recovery growth · Filed 22/07/2026
Total expense decreased $15 million as efficiency savings, gains on property dispositions and other decreases were largely offset by higher fuel prices, inflation and higher incentive compensation.
MD&A / efficiency savings, property gains and cost pressures · Filed 22/07/2026
Financial Statements and Supplementary Data CONSOLIDATED INCOME STATEMENTS (Dollars in Millions, Except Per Share Amounts) Years Ended 2025 2024 2023 Revenue $ 14,092 $ 14,540 $ 14,657 Expense Labor and Fringe 3,262 3,165 3,052 Purchased Services and Other 3,013 2,841 2,768 Depreciation and Amortization 1,680 1,658 1,607 Fuel 1,095 1,168 1,377 Equipment and Other Rents 357 355 354 Goodwill Impairment (Note 18) 164 108 — Total Expense 9,571 9,295 9,158 Operating Income 4,521 5,245 5,499 Interest Expense (844) (832) (809) Other Income - Net (Note 14) 92 142 139 Earnings Before Income Taxes 3,769 4,555 4,829 Income Tax Expense (Note 12) (880) (1,085) (1,161) Net Earnings $ 2,889 $ 3,470 $ 3,668 Per Common Share (Note 2) Net Earnings Per Share Basic $ 1.54 $ 1.79 $ 1.83 Assuming Dilution $ 1.54 $ 1.79 $ 1.82 Average Common Shares Outstanding (Millions) Basic 1,870 1,939 2,008 Assuming Dilution 1,873 1,943 2,013 Certain prior year data has been reclassified to conform to the current presentation.
Consolidated income statements / 2023–2025 results · Filed 12/02/2026
CSXT is required to comply with regulations regarding the handling of hazardous materials and has a legal obligation to transport certain hazardous materials under the common carrier mandate.
Risk factors / existing hazardous-material common carrier obligation · Filed 12/02/2026
Financial Statements and Supplementary Data CONSOLIDATED CASH FLOW STATEMENTS (Dollars in Millions) Years Ended 2025 2024 2023 OPERATING ACTIVITIES Net Earnings $ 2,889 $ 3,470 $ 3,668 Adjustments to Reconcile Net Earnings to Net Cash Provided by Operating Activities: Depreciation and Amortization 1,680 1,658 1,607 Goodwill Impairment (Note 18) 164 108 — Deferred Income Taxes 194 12 126 Other Operating Activities (70) (75) (41) Changes in Operating Assets and Liabilities: Accounts Receivable 88 82 (51) Other Current Assets (87) 45 (112) Accounts Payable 40 3 74 Income and Other Taxes Payable (399) (19) 430 Other Current Liabilities 114 (37) (187) Net Cash Provided by Operating Activities 4,613 5,247 5,514 INVESTING ACTIVITIES Property Additions (2,902) (2,529) (2,257) Purchases of Short-term Investments — (66) (104) Proceeds from Sales of Short-term Investments 80 91 153 Proceeds and Advances from Property Dispositions 78 66 88 Business Acquisition, Net of Cash Acquired (16) (70) (31) Other Investing Activities (91) (97) (76) Net Cash Used in Investing Activities (2,851) (2,605) (2,227) FINANCING ACTIVITIES Shares Repurchased (1,396) (2,237) (3,482) Dividends Paid (972) (930) (882) Long-term Debt Repaid (613) (558) (153) Long-term Debt Issued (Note 10) 900 550 600 Other Financing Activities 56 113 50 Net Cash Used in Financing Activities (2,025) (3,062) (3,867) Net Decrease in Cash and Cash Equivalents (263) (420) (580) CASH AND CASH EQUIVALENTS Cash and Cash Equivalents at Beginning of Period 933 1,353 1,933 Cash and Cash Equivalents at End of Period $ 670 $ 933 $ 1,353 SUPPLEMENTAL CASH FLOW INFORMATION Interest Paid - Net of Amounts Capitalized $ 870 $ 850 $ 806 Income Taxes Paid (Note 12) $ 1,102 $ 1,076 $ 630 Capital Expenditures Accrued but Not Yet Paid $ 231 $ 247 $ 186 Certain prior year data has been reclassified to conform to the current presentation.
Consolidated cash flow statements / investment, distributions and financing · Filed 12/02/2026
Trucking expenses include $164 million and $108 million impairment charges related to Quality Carriers' goodwill in 2025 and 2024, respectively.
Note 17 / Quality Carriers goodwill impairments · Filed 12/02/2026
During the six months ended June 30, 2026, CSX did not issue any long-term debt.
MD&A / no long-term debt issuance in first-half 2026 · Filed 22/07/2026
Second Quarters Six Months (Dollars in Millions) 2026 2025 2026 2025 Share-Based Compensation Expense: Performance Units $ 16 $ 2 $ 18 $ 2 Restricted Stock Units 4 7 8 13 Stock Options 4 3 7 6 Employee Stock Purchase Plan 3 3 5 5 Stock Awards for Directors — — 2 3 Total Share-Based Compensation Expense $ 27 $ 15 $ 40 $ 29 Income Tax Benefit $ 5 $ 3 $ 12 $ 6 Long-term Incentive Plan In February 2026, the Company granted the following awards under a new long-term incentive plan ("LTIP") for the years 2026 through 2028, which was adopted under the CSX 2019 Stock and Incentive Award Plan.
Note 3 / compensation expense and adopted February 2026 LTIP grants · Filed 22/07/2026
Stock Plans and Share-Based Compensation, continued Performance Units Units vest based on performance approximately three years after grant with payouts made in CSX common stock.
Note 3 / performance vesting and stock settlement · Filed 22/07/2026
The 2026-2028 plan's performance measures are Return on Invested Capital (“ROIC”) and relative Total Shareholder Return (“rTSR”).
Note 3 / adopted LTIP performance measures · Filed 22/07/2026
These measures are assessed independently of each other and weighted at 60% ROIC and 40% rTSR, respectively, for a total payout of 100% of the grant value.
Note 3 / ROIC and relative shareholder return weightings · Filed 22/07/2026
Key elements of our comprehensive governance program include: uAnnual election of directors; uMajority voting standard for the election of directors and director resignation policy; uQualification guidelines for director candidates and review of each director’s performance and continuing qualifications for Board membership; uIndependent Chair of the Board; uAudit Committee, Compensation and Talent Management Committee, and Governance and Sustainability Committee comprised solely of independent directors; uRegular executive sessions of independent directors; uAnnual evaluation of Board and committee performance; uBoard access to independent advisors; uStock ownership guidelines for directors and officers; uMeaningful limitations on directors’ service on other public company boards; uDisciplined succession planning and effective leadership transitions at the CEO and executive management levels; uNo “poison pill” (shareholder rights plan); uProxy access for director candidates nominated by shareholders reflecting standard market practices; uShareholder rights to call special meetings; uPolicy against hedging and pledging of CSX common stock; uPay-for-performance alignment; and uRobust shareholder outreach and engagement program.
Proxy / existing governance practices and shareholder rights · Filed 30/03/2026
During 2025, the Audit Committee was comprised solely of independent directors as defined by applicable NASDAQ listing standards and Rule 10A-3 of the Securities Exchange Act of 1934.
Audit Committee report / actual 2025 committee independence · Filed 30/03/2026
During 2025, there were no Related Person Transactions, as defined above.
Proxy / absence of defined related person transactions in 2025 · Filed 30/03/2026
A hallmark of the year was the on-schedule completion of two transformative infrastructure projects that expand and improve the capabilities of our network.
Shareholder letter / management report of on-schedule project completion · Filed 30/03/2026
With full double-stack capability anticipated in the Spring of 2026, this investment creates opportunities for new intermodal service offerings into the Northeast that we expect to be an important driver of future growth.
Shareholder letter / anticipated double-stack capability and future growth · Filed 30/03/2026
•Efficiency savings net of inflation were $50 million, driven by cost reductions across operating and support functions.
MD&A / first-quarter realized efficiency savings net of inflation · Filed 22/04/2026
