CSX’s second quarter results were met with a positive market response, reflecting operational improvements and cost control after a challenging start to the year. Management attributed the quarter’s recovery to decisive actions that improved network velocity and reduced disruptions, with CEO Joe Hinrichs highlighting that “the momentum behind [the results] is a result of deliberate and effective actions taken to return our network back to the efficient, well-run operation needed.” Upgrades in train handling, cost reductions, and progress on major infrastructure projects contributed to the sequential rebound, even as overall sales volumes remained flat and certain segments, such as coal, continued to face pricing headwinds.
Is now the time to buy CSX? Find out in our full research report (it’s free).
CSX (CSX) Q2 CY2025 Highlights:
- Revenue: $3.57 billion vs analyst estimates of $3.57 billion (3.4% year-on-year decline, in line)
- Adjusted EPS: $0.44 vs analyst estimates of $0.42 (6% beat)
- Adjusted EBITDA: $1.71 billion vs analyst estimates of $1.65 billion (47.8% margin, 3.5% beat)
- Operating Margin: 35.9%, down from 39.1% in the same quarter last year
- Sales Volumes were flat year on year (2.1% in the same quarter last year)
- Market Capitalization: $66.03 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions CSX’s Q2 Earnings Call
- Brian Ossenbeck (JPMorgan): Asked about potential rail industry consolidation and its benefits for shippers; CEO Joe Hinrichs reiterated a focus on customer service and declined to speculate on mergers, emphasizing opportunities to improve service across the industry.
- Ariel Rosa (Citigroup): Inquired about the sustainability of service improvements and whether gains were due to weather or internal actions; COO Mike Cory detailed proactive operational steps and said further improvement is expected as infrastructure projects conclude.
- Eric Morgan (Barclays): Queried about volume guidance and potential margin improvement; CCO Kevin Boone highlighted the impact of production outages and expected sequential improvement, while CFO Sean Pelkey cautioned that seasonal wage increases and restructuring charges could pressure margins next quarter.
- Stephanie Moore (Jefferies): Asked about the management reorganization; CEO Joe Hinrichs explained the process aimed at improving efficiency and aligning resources for incremental business opportunities.
- Scott Group (Wolfe Research): Sought clarity on cost trends and coal outlook; Pelkey confirmed cost discipline and sequential improvement, while Boone noted positive trends in domestic coal demand and potential mine restarts in the coming quarters.
Catalysts in Upcoming Quarters
In coming quarters, StockStory analysts will watch (1) the timely completion and integration of the Howard Street Tunnel and Blue Ridge subdivision projects, (2) progress in converting industrial development pipeline projects into new volume, and (3) signs of margin stabilization or improvement despite labor and inflationary pressures. Additionally, we will monitor whether gains in service reliability translate into sustainable growth across challenged segments such as automotive, chemicals, and coal.
CSX currently trades at $35.50, up from $34.95 just before the earnings. At this price, is it a buy or sell? See for yourself in our full research report (it’s free).
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