Key Points
CSX increased third-quarter volume by 5% and cut nonfuel costs by 3%.
Intermodal volume rose 7% year over year to an all-time record.
CSX projects full-year free cash flow growth of more than 80%.
On its third-quarter 2026 earnings call, held on Oct. 21, 2026, CSX (NASDAQ:CSX) announced a 30% increase in earnings per share over last year's adjusted result. Operational efficiency and steady volume growth continue to expand profit margins for long-term shareholders. Three things management said stand out.
1. Nonfuel Cost Reductions Drive Profit Margins Higher
Management reduced nonfuel operating expenses while moving more freight, expanding operating margin by over four percentage points. Better asset utilization across locomotives and lower reliance on external contractors helped offset broader inflation.
The team handled 5% more volume in the third quarter, while reducing nonfuel costs by 3%.
-- Kevin S. Boone, Executive Vice President and Chief Financial Officer
2. Highway Conversions Fuel Record Intermodal Volumes
Tight truck capacity and elevated diesel prices are forcing shippers to move freight from highways to rail networks. CSX saw intermodal shipments -- freight moved in standardized containers using multiple transport modes -- reach an all-time peak.
Total intermodal volume was up 7% year-over-year, and reached a new all time record.
-- Maryclare Kenney, Senior Vice President and Chief Commercial Officer
3. Surgical Pricing Power Offsets Market Inflation
Discipline during contract renewals helps protect operating margins against persistent cost increases. Commercial teams are accelerating discretionary price increases on merchandise shipments as service consistency improves across the network.
We still expect for this year our same store sales pricing to be stronger than it was last year. And I would tell you, we have seen discretionary pricing on the merchandise accelerate as we have moved throughout the course of this year.
-- Maryclare Kenney, Senior Vice President and Chief Commercial Officer
Looking Ahead
Freight momentum is building, and CSX is expanding track infrastructure to handle incoming volume. Full double-stack clearances -- stacking containers two high on railcars -- and direct connections to new industrial facilities provide structural advantages over trucking. Management is watching conductor trainee staffing and pricing discipline.
I am confident that we will achieve full year operating margin expansion of more than 350 basis points.
-- Stephen F. Angel, President and Chief Executive Officer
Systemwide efficiency gains position the railroad to compound long-term shareholder value.
Together, we have made great progress toward our goal of being best in class as we build a high performance culture that embraces continuous improvement.
-- Stephen F. Angel, President and Chief Executive Officer
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