CSX (CSX) UBS’s 2025 Global Technology and AI Conference summary

Market trends and business performance

• Industrial economy is mixed, with strength in metals, minerals, and fertilizers, but weakness in chemicals, forest products, housing, and autos persists.

• Coal demand is strong in the Southeast, supported by high natural gas prices, though a VA derailment caused a ~$30M EBIT impact; automotive faced a ~$10M EBIT hit from supply shortages.

• Intermodal business shows momentum, with network improvements and new partnerships driving truck-to-rail conversions; international volumes are slowing, but domestic remain strong.

• Automotive and coal segments faced temporary headwinds due to external disruptions, but much of the volume is expected to be deferred rather than lost.

• Industrial development is expected to contribute to volume growth in 2026 and 2027, partially offset by recent plant closures.

Operational improvements and capacity

• Network performance has improved, with record speed and dwell metrics, and significant available capacity for intermodal growth.

• Howard Street Tunnel and Blue Ridge Sub projects are on track, enhancing Northeast connectivity and overall network resilience.

• Capital efficiency is a focus, especially in track and infrastructure spending, with over $1 billion allocated and targeted for greater rigor and returns.

• Overtime for road trains has been reduced by 30% year-over-year, reflecting operational discipline.

• Technology investments are prioritized for projects that drive growth or productivity, with a recalibrated approach to capital allocation.

Leadership, culture, and strategic direction

• New CEO brings a strong focus on price, productivity, and cash flow, energizing the leadership team and organization.

• Alignment around safety, service, and efficiency is emphasized, with a culture of accountability and continuous improvement.

• Cost control and capital discipline are central, with opportunities identified in overtime, rentals, and general spend.

• Shareholder returns remain a priority, with excess cash flow targeted for buybacks and rigorous project evaluation.

• The team is committed to building a winning culture and leveraging operational improvements for future growth.