CSX Corporation

remained positive in the fourth quarter and we delivered modest total volume growth. However, reported operating income, operating margin and earnings per share were all lower year over year. As noted in our press release, these results included approximately $50 million in expenses related to important actions we've taken to adjust our cost structure, deliver better financial results and position the railroad to succeed. We are committed to delivering stronger performance into 2026 as we build on our key accomplishments. We've renewed the leadership team, putting the best people into the best positions to drive value. And we're aligned in driving greater physical responsibility and discipline execution across the company. We've stabilized service on our network at high levels. delivering consistency and reliability for our customers while realizing clear productivity gains. We've capitalized on the strength of our service to win business, and we will be ready and able to respond when demand increases. As we move forward, you will continue to see us take thoughtful actions to drive greater profitability and cash flow and build momentum into the year ahead. And now I'll turn it over to Mike.

Thank you, Steve. So, let's take a quick look at our safety and operational metrics on slide five. Our operations team is improving safety performance through focused execution of our safety plan. The left portion of this slide highlights meaningful full-year declines in both FRA injury and accident rates, with the fourth quarter posting the year's best metrics. We know that an outstanding safety record is a clear indicator of effective management at every level. and we're taking solid steps towards our goal of reaching best-in-class performance for the industry. The right portion of the slide shows strong year-end fluidity and customer service performance. Velocity, Cars Online, Dwell, and Tripline Compliance all showed substantial improvement from Q1 to Q4. These are encouraging trends as we enter 2026. Running a cost-effective, efficient network while delivering consistent, reliable service is essential to our success. We'll maintain this balance and preserve our operational momentum while ensuring CSX has the capacity available when the industrial cycle turns. Kevin will now review our quarterly results in more detail.

Thank you, Mike, and good afternoon. I'm excited to be back in the CFO role and have an opportunity to work with this team. As Steve mentioned, over the last couple months, we have taken steps to align our cost structure to the current business environment. The team is fully engaged and encouraged by the momentum we are building with opportunities to drive efficiencies in nearly every part of our business as we enter 2026. Now let's move to the fourth quarter results. Volume increased 1% with revenue down 1% driven by business mix headwinds and coal pricing. Fourth quarter operating income and earnings per share fell by 9% and 7% respectively against suggested prior year figures. These results included approximately $50 million, or two cents, of charges for actions taken during the fourth quarter to optimize our workforce and technology portfolio. Now let's turn to the next slide for a closer look at the expense line. Fourth quarter expenses increased by $73 million, or 3%, excluding the 2024 goodwill impairment. As mentioned, the quarter included approximately $50 million of charges comprised of $31 million of separation costs in the labor line and $21 million of technology impairments in PS&O. We continue to see opportunities to drive efficiency in our labor costs as we prioritize safety, customer service, and profitable growth. Ending real headcount finished the quarter down over 3% as we continue to align to the current business environment. Additionally, overtime remains a focus for Mike's team as we look for ways to provide better visibility and tools to manage these costs. We have identified meaningful opportunities to reduce non-labor spending with well over 100 diverse savings initiatives across the company, including cutting outside and professional service spend, improving asset utilization and maintenance efficiencies, as well as enhancing controls around all sources of discretionary spend. 2026 expenses will also see year-over-year benefit from cycling network disruption costs, third and fourth quarter separation costs, and fourth quarter technology impairments. Depreciation expense will be relatively stable year-over-year as normal increases to the asset base are offset by favorable results from an equipment life study, asset retirements, and targeted reductions to technology and aviation assets. We are encouraged by the cost improvements identified as we move through the quarter. Similar to our focus on cost, capital spend and driving free cash flow remains a significant area of opportunity. Working with Mike and his team, we are developing improved oversight to ensure every dollar of capital is spent efficiently and aligns to our strategic priorities, including safety, customer service, and driving profitable growth. With that, I'll turn it over to Mary Claire to review our revenue results.