CSX CEO signals he would be open to merger talks as profit falls 14% in
the second quarter
[July 24, 2025] By
JOSH FUNK
CSX railroad's CEO signaled he would be open to merger conversations if
a deal would boost shareholder value and help the business grow.
As merger rumors swirl in the industry, the Jacksonville, Florida-based
railroad said Wednesday that its second-quarter profit dipped 14% to
$829 million, or $0.44 per share. That's down from $963 million, or
$0.49 per share, a year ago.
The railroad continues working on two major construction projects that
are causing delays and added costs, but the results were in line with
what the analysts surveyed by FactSet Research predicted.
CEO Joe Hinrichs wouldn't comment directly on the merger rumors and he
said that CSX is focused on improving its operations. But Hinrichs also
said his railroad would remain open to any possibilities that would help
boost shareholder value. The Associated Press reported last week that
Union Pacific was in merger talks with Norfolk Southern. Hinrichs
wouldn't say if CSX is discussing a merger with anyone.
“While we are confident in CSX’s path forward, we welcome all
opportunities that will allow us to deliver value for our shareholders,
drive profitable growth, and serve our customers better,” Hinrichs said.
If merger actions heat up in the industry, CSX could be a target for one
of the western railroads trying to build a transcontinental network. But
the prospects for any deals among the major freight railroads remain
uncertain because regulators might be reluctant to approve them.
Hinrichs said he thinks there are opportunities to attract new business
and prosper by working together with other railroads today. One example
is the new service that CSX and CPKC railroads recently announced to
deliver shipments that CPKC picks up in Mexico and have CSX deliver them
in the southeast United States.
CSX is in the middle of expanding a key tunnel in Baltimore, so it will
be able to carry double-stacked shipping containers, and the railroad is
completing repairs related to Hurricanes Helene and Milton. Those
projects are adding about $10 million in additional costs every month
because of all the shipments that need to be re-routed and constraining
the railroad's capacity, so it will be a relief when they are done in
the fourth quarter.
[to top of second column] |
A CSX train engine sits idle on tracks in Philadelphia, Sept. 14,
2022. (AP Photo/Matt Rourke, File)
 Hinrichs said the railroad is
operating much more fluidly than it was in the first quarter of this
year when the results disappointed. The railroad also eliminated
about 125 management jobs earlier this month in a restructuring.
Hinrichs said the railroad will take a $15 million to $20 million
charge for that in the third quarter, but those cuts will save CSX
about $30 million in expenses per year.
Edward Jones analyst Jeff Windau said in a research note that the
railroad had a decent quarter even though its service suffered while
re-routing so many shipments around the construction.
CSX executives said it remains hard to predict consumer sentiment
that drives so much of the economy right now, but if Donald Trump's
tariff policy and interest rates become more certain in the second
half of the year that should help consumers and businesses feel more
comfortable spending and expanding their operations.
“We’re really looking forward to these trade deals and providing
some certainty,” Hinrichs said. “The tax bill provides certainty now
for businesses. And hopefully we can get an interest rate cut or two
in the second half which will also help.”
CSX is one of the major freight railroads that serves the eastern
United States and competes with Norfolk Southern.
All contents © copyright 2025 Associated Press. All rights reserved
 |
