CSX's Earnings & Revenues Miss Estimates in Q3, Increase Y/Y

Core Viewpoint - CSX Corporation's third-quarter 2024 earnings per share of 46 cents fell short of expectations, but year-over-year growth was observed due to increased freight volumes and revenues [1][2]. Financial Performance - Total revenues reached $3.62 billion, a 1% increase year-over-year, driven by merchandise pricing gains and growth in intermodal and merchandise volumes, although it fell short of the Zacks Consensus Estimate of $3.68 billion [2]. - Operating income increased by 7% to $1.35 billion, while total expenses rose by 2% to $2.3 billion, primarily due to a 6% increase in labor and fringe costs [2]. - Overall volumes grew by 3% year-over-year [2]. Segmental Performance - Merchandise revenues improved by 6% year-over-year to $2.23 billion, slightly below the estimate of $2.24 billion, with merchandise volumes rising by 3% [3]. - Intermodal revenues decreased by 2% year-over-year to $509 million, below the estimate of $562 million, despite a 3% increase in segmental volumes [3]. - Coal revenues fell by 7% year-over-year to $553 million, also below the estimate of $589 million, with coal volumes decreasing by 2% [3]. - Trucking revenues totaled $214 million, down 2% year-over-year, while other revenues plunged by 15% to $112 million [3]. Liquidity - CSX ended the third quarter of 2024 with cash and cash equivalents of $1.64 billion, up from $1.35 billion at the end of 2023, while long-term debt increased to $18.53 billion from $17.97 billion [4]. - The company generated $3.86 billion in cash from operating activities, with free cash flow at $2.22 billion before dividend payments [4]. Outlook - CSX anticipates a capital expenditure of $2.5 billion for the current year, excluding infrastructure rebuilds due to recent hurricanes [5]. - Management expects modest volume growth in the final quarter of 2024, with revenues likely to decrease by approximately $200 million due to lower fuel prices and softer coal markets [5].