CSX said Thursday that its profit slipped 2% in the fourth quarter as the railroad dealt with weak demand and severance costs from layoffs that new CEO Steve Angel carried out last fall.
The Jacksonville, Florida-based railroad said it earned $720 million, or 39 cents per share, in the quarter. That’s down from $733 million, or 38 cents per share.
But the results were weighed down by about $50 million in one-time costs that drug down profits by 2 cents per share. Without that, the numbers would have been inline with the 41 cents per share that the analysts surveyed by FactSet Research had predicted.
“This has been a challenging year for CSX and for our industry overall, with subdued demand and limited growth opportunities,” CEO Steve Angel said. CSX said its revenue slipped 1% to $3.51 billion in the quarter.
The competitive landscape in the railroad business could change drastically in the next few years if Union Pacific’s proposed $85 billion acquisition of Norfolk Southern is approved. But Angel said he isn’t too worried about that yet because the Surface Transportation Board’s formal review of the deal hasn’t even started.
Most observers believe CSX and BNSF will be at a competitive disadvantage if that merger is approved. That new transcontinental railroad would control nearly half of all freight and could shave more than a day off delivery times because it won’t have to hand off shipments between railroads in the middle of the country. At this point, CSX and BNSF are focused on improving their delivery times through cooperative agreements instead of a merger.
Heading into 2026, CSX is working on improving productivity while limiting costs. But Angel said he expects only modest economic growth this year amid all the uncertainty. He predicted that CSX will see revenue grow only by low single digits, and the railroad pulled its targets for 2027 that it had established a couple of years ago.
“The focus is just making sure that we can be as competitive as we can. But at the end of the day, we can create value by running CSX better every day,” Angel said.
Last fall CSX wrapped up the two major construction projects that disrupted its network and limited the railroad’s flexibility. CSX completed a major tunnel renovation in Baltimore and repairs from Hurricane Helene. That helped raise its trains’ average speed to 19.6 mph in the fourth quarter while delivering 87% of its shipments on time.
The tunnel project will allow CSX to begin hauling metal shipping containers filled with assorted goods stacked two high across its network this year. But competitor Norfolk Southern announced a similar double-stacked service in the east earlier this week.
CSX is one of the largest railroads in North America, operating in the eastern United States.
