nsc-20250331

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2025

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to___________

Commission File Number: 1-8339

NORFOLK SOUTHERN CORPORATION

(Exact name of registrant as specified in its charter)


Virginia						52-1188014
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)


650 West Peachtree Street NW		30308-1925
Atlanta,	Georgia
(Address of principal executive offices)		(Zip Code)
(855)		667-3655
(Registrant’s telephone number, including area code)


No change
(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol	Name of each exchange on which registered
Norfolk Southern Corporation Common Stock (Par Value $1.00)	NSC	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.


Class	Outstanding at March 31, 2025
Common Stock ($1.00 par value per share)	225,443,501	(excluding 20,320,777 shares held by the registrant’s
	consolidated subsidiaries)

TABLE OF CONTENTS

NORFOLK SOUTHERN CORPORATION AND SUBSIDIARIES


		Page
Part I.	Financial Information:
	Item 1.	Financial Statements:
		Consolidated Statements of Income First Quarter of 202 5 and 20 24	3
		Consolidated Statements of Comprehensive Income First Quarter of 202 5 and 20 24	4
		Consolidated Balance Sheets At March 3 1 , 202 5 and December 31, 202 4	5
		Consolidated Statements of Cash Flows First Three Months of 202 5 and 202 4	6
		Consolidated Statements of Changes in Stockholders’ Equity First Quarter of 202 5 and 20 24	7
		Notes to Consolidated Financial Statements	8
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	35
	Item 4.	Controls and Procedures	35

Part II.	Other Information:
	Item 1.	Legal Proceedings	36
	Item 1A.	Risk Factors	36
	Item 2.	Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities	36
	Item 3.	Defaults Upon Senior Securities	36
	Item 4.	Mine Safety Disclosures	36
	Item 5.	Other Information	36
	Item 6.	Exhibits	37

		Signatures	38

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Income

(Unaudited)


	First Quarter
	2025		2024
	($ in millions, except per share amounts)

Railway operating revenues	$	2,993	$	3,004

Railway operating expenses
Compensation and benefits	739		736
Purchased services and rents	498		528
Fuel	244		284
Depreciation	346		337
Materials and other	205		215
Restructuring and other charges	—		99
Eastern Ohio incident	(185)		592

Total railway operating expenses	1,847		2,791

Income from railway operations	1,146		213

Other income – net	31		18
Interest expense on debt	199		201

Income before income taxes	978		30

Income taxes	228		(23)

Net income	$	750	$	53

Earnings per share
Basic	$	3.31	$	0.23
Diluted	3.31		0.23

See accompanying notes to consolidated financial statements.

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Comprehensive Income

(Unaudited)


	First Quarter
	2025		2024
	($ in millions)

Net income	$	750	$	53
Other comprehensive income (loss), before tax:
Pension and other postretirement expense	—		(2)

Other comprehensive income of equity investees	1		—

Other comprehensive income (loss), before tax	1		(2)
Income tax benefit related to items of other
comprehensive income	—		—

Other comprehensive income (loss), net of tax	1		(2)

Total comprehensive income	$	751	$	51

See accompanying notes to consolidated financial statements.

Norfolk Southern Corporation and Subsidiaries

Consolidated Balance Sheets

(Unaudited)


	March 31, 2025		December 31, 2024
	($ in millions)
Assets
Current assets:
Cash and cash equivalents	$	1,006	$	1,641

Accounts receivable – net	1,231		1,069
Materials and supplies	273		277
Other current assets	191		201
Total current assets	2,701		3,188

Investments	4,003		3,370
Properties less accumulated depreciation of $14,188
and $13,957, respectively	35,803		35,831
Other assets	1,293		1,293

Total assets	$	43,800	$	43,682

Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	1,445	$	1,704

Income and other taxes	490		337
Other current liabilities	960		949
Current maturities of long-term debt	555		555
Total current liabilities	3,450		3,545

Long-term debt	16,660		16,651
Other liabilities	1,702		1,760
Deferred income taxes	7,477		7,420

Total liabilities	29,289		29,376

Stockholders’ equity:
Common stock $1.00 per share par value, 1,350,000,000 shares
authorized; outstanding 225,443,501 and 226,320,894 shares,
respectively, net of treasury shares	227		228
Additional paid-in capital	2,249		2,247
Accumulated other comprehensive loss	(261)		(262)
Retained income	12,296		12,093

Total stockholders’ equity	14,511		14,306

Total liabilities and stockholders’ equity	$	43,800	$	43,682

See accompanying notes to consolidated financial statements.

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Cash Flows

(Unaudited)


		First Three Months
		2025		2024
		($ in millions)
Cash flows from operating activities
	Net income	$	750	$	53
	Reconciliation of net income to net cash provided by operating activities:
	Depreciation	346		337
	Deferred income taxes	57		(26)
	Gains and losses on properties	(23)		(1)
	Changes in assets and liabilities affecting operations:
	Accounts receivable	(165)		(51)
	Materials and supplies	4		(6)
	Other current assets	31		33
	Current liabilities other than debt	22		560
	Other – net	(72)		(60)

	Net cash provided by operating activities	950		839

Cash flows from investing activities
	Property additions	(449)		(557)
	Acquisition of assets of CSR	—		(1,642)
	Property sales and other transactions	18		32
	Investment purchases	(609)		(1)
	Investment sales and other transactions	19		324

	Net cash used in investing activities	(1,021)		(1,844)

Cash flows from financing activities
	Dividends	(306)		(305)
	Common stock transactions	(9)		(6)
	Purchase and retirement of common stock	(248)		—
	Proceeds from borrowings	—		400
	Debt repayments	(1)		—

	Net cash provided by (used in) financing activities	(564)		89

	Net decrease in cash and cash equivalents	(635)		(916)

Cash and cash equivalents
	At beginning of year	1,641		1,568

	At end of period	$	1,006	$	652

Supplemental disclosures of cash flow information
	Cash paid during the period for:
	Interest (net of amounts capitalized)	$	192	$	182
	Income taxes (net of refunds)	1		(2)

See accompanying notes to consolidated financial statements.

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Changes in Stockholders’ Equity

(Unaudited)


	Common Stock		Additional Paid-in Capital		Accum. Other Comprehensive Loss		Retained Income		Total
	($ in millions, except per share amounts)

Balance at December 31, 2024	$	228	$	2,247	$	(262)	$	12,093	$	14,306

Comprehensive income:
Net income							750		750
Other comprehensive income					1				1
Total comprehensive income									751
Dividends on common stock,
$1.35 per share							(306)		(306)
Share repurchases	(1)		(9)				(240)		(250)
Stock-based compensation			11				(1)		10

Balance at March 31, 2025	$	227	$	2,249	$	(261)	$	12,296	$	14,511


	Common Stock		Additional Paid-in Capital		Accum. Other Comprehensive Loss		Retained Income		Total
	($ in millions, except per share amounts)

Balance at December 31, 2023	$	227	$	2,179	$	(320)	$	10,695	$	12,781

Comprehensive income:
Net income							53		53
Other comprehensive loss					(2)				(2)
Total comprehensive income									51
Dividends on common stock,
$1.35 per share							(305)		(305)

Stock-based compensation			9						9

Balance at March 31, 2024	$	227	$	2,188	$	(322)	$	10,443	$	12,536

See accompanying notes to consolidated financial statements.

Norfolk Southern Corporation and Subsidiaries

Notes to Consolidated Financial Statements

(Unaudited)

In the opinion of management, the accompanying unaudited interim consolidated financial statements contain all adjustments (consisting of normal recurring accruals) necessary to present fairly Norfolk Southern Corporation (Norfolk Southern) and subsidiaries’ (collectively, NS, we, us, and our) financial position at March 31, 2025 and December 31, 2024, our results of operations, comprehensive income and changes in stockholders’ equity for the first quarters of 2025 and 2024, and our cash flows for the first three months of 2025 and 2024 in conformity with U.S. Generally Accepted Accounting Principles (GAAP).

These consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in our latest Annual Report on Form 10-K.

1. Segment Reporting

The Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2023-07 “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures” which requires additional reportable segment disclosures related to significant segment expenses and information used to assess performance. We adopted the provisions of this standard and updated our segment disclosures herein.

We manage our company as one reportable operating segment, railway operations, providing rail transportation to customers. Although we provide and analyze revenues by commodity group, the overall financial and operational performance of the railroad is analyzed as one operating segment due to the nature of our integrated rail network.

The chief operating decision maker assesses performance for the railway operations segment and decides how to allocate resources based on “Net income” that is reported on the Consolidated Statements of Income. The measure of segment assets is reported on the Consolidated Balance Sheets as “Total assets.” Total expenditures for long-lived assets are disclosed as “Property additions” on the Consolidated Statement of Cash Flows.

Railway operations segment revenues, expenses, and profit are disclosed below as reviewed and used by the chief operating decision maker. There are no other significant segment items or reconciling items to segment profit.


	First Quarter
	2025		2024
	($ in millions)

Railway operating revenues (Note 2)	$	2,993	$	3,004

Railway operating expenses
Compensation and benefits	739		736
Purchased services	401		420
Equipment rents	97		108
Fuel	244		284
Depreciation	346		337
Materials	100		98
Claims	66		48
Other	39		69
Restructuring and other charges	—		99
Eastern Ohio incident	(185)		592

Total railway operating expenses	1,847		2,791

Income from railway operations	1,146		213

Other income – net	31		18
Interest expense on debt	199		201

Income before income taxes	978		30

Income taxes	228		(23)

Net income	$	750	$	53

2. Railway Operating Revenues

The following table disaggregates our revenues by major commodity group:


	First Quarter
	2025		2024
	($ in millions)
Merchandise:
Agriculture, forest and consumer products	$	636	$	629
Chemicals	535		527
Metals and construction	414		430
Automotive	278		277
Merchandise	1,863		1,863
Intermodal	760		745
Coal	370		396

Total	$	2,993	$	3,004

We recognize the amount of revenues to which we expect to be entitled for the transfer of promised goods or services to customers. A performance obligation is created when a customer under a transportation contract or public tariff submits a bill of lading to us for the transport of goods. These performance obligations are satisfied as the shipments move from origin to destination. As such, transportation revenues are recognized proportionally as a shipment moves, and related expenses are recognized as incurred. These performance obligations are generally short-term in nature with transit days averaging approximately one week or less for each commodity group. The customer has an unconditional obligation to pay for the service once the service has been completed. Estimated revenues associated with in-process shipments at period-end are recorded based on the estimated percentage of service completed. We had no material remaining performance obligations at March 31, 2025 and December 31, 2024.

We may provide customers ancillary services, such as switching, demurrage and other incidental activities, under their transportation contracts. The revenues associated with these distinct performance obligations are recognized when the services are performed or as contractual obligations are met. These revenues are included within each of the commodity groups and represent approximately 5% and 4% of total “Railway operating revenues” on the Consolidated Statements of Income for the first quarters of 2025 and 2024, respectively.

Revenues related to interline transportation services that involve another railroad are reported on a net basis. Therefore, the portion of the amount that relates to another party is not reflected in revenues.

Under the typical terms of our freight contracts, payment for services is due within fifteen days of billing the customer, thus there are no significant financing components. “Accounts receivable – net” on the Consolidated Balance Sheets includes both customer and non-customer receivables as follows:


	March 31, 2025		December 31, 2024
	($ in millions)

Customer	$	863	$	787
Non-customer	368		282

Accounts receivable – net	$	1,231	$	1,069

Non-customer receivables include non-revenue-related amounts due from other railroads, governmental entities, insurers, and others. We do not have any material contract assets or liabilities at March 31, 2025 and December 31, 2024.

3. Stock-Based Compensation


	First Quarter
	2025		2024
	($ in millions)

Stock-based compensation expense	$	18	$	19
Total tax benefit	5		5

During the first quarter of 2025, we granted stock options, restricted stock units (RSUs) and performance share units (PSUs) pursuant to the Long-Term Incentive Plan (LTIP), as follows:


	First Quarter
	Granted	Weighted-Average Grant-Date Fair Value

Stock options	80,067	$	87.33
RSUs	190,134	255.32
PSUs	66,334	296.55

Stock Options


	First Quarter
	2025		2024
	($ in millions)

Options exercised	42,552		97,217
Cash received upon exercise	$	4	$	9
Related tax benefits realized	1		3

Restricted Stock Units

RSUs granted primarily have three- and four-year ratable restriction periods and will be settled through the issuance of shares of Norfolk Southern common stock (Common Stock). Certain RSU grants include cash dividend equivalent payments during the restriction period in an amount equal to the regular quarterly dividends paid on Common Stock.


	First Quarter
	2025		2024
	($ in millions)

RSUs vested	152,764		156,651
Common Stock issued net of tax withholding	107,257		108,250
Related tax benefits realized	$	1	$	—

Performance Share Units

PSUs provide for awards based on the achievement of certain predetermined corporate performance goals at the end of a three-year cycle and are settled through the issuance of shares of Common Stock. All PSUs will earn out based on the achievement of performance conditions and some will also earn out based on a market condition. The market condition fair value was measured on the date of grant using a Monte Carlo simulation model.


	First Quarter
	2025		2024
	($ in millions)

PSUs earned	8,540		41,580
Common Stock issued net of tax withholding	5,633		26,056
Related tax benefits realized	$	—	$	—

4. Restructuring and Other Charges

During the first quarter of 2024, we initiated voluntary and involuntary separation programs to reduce our management workforce. Through these programs, approximately 350 management employees were separated from service by May 2024. “Restructuring and other charges” reflects separation payments and other benefits to the impacted management employees and amounted to $64 million. Additionally, we evaluated the impact of these separation programs on our pension and other postretirement benefit plans, as further discussed in Note 10.

In March 2024, we appointed John Orr as Executive Vice President and Chief Operating Officer of the Company. “Restructuring and other charges” also includes $35 million of costs related to this appointment, including an

agreement with his previous employer, Canadian Pacific Kansas City (CPKC), that resulted in a $25 million payment and certain commercial considerations to CPKC in exchange for a waiver of his non-compete provisions.

5. Earnings Per Share

The following table sets forth the calculation of basic and diluted earnings per share:


	Basic				Diluted
	First Quarter
	2025		2024		2025		2024
	($ in millions, except per share amounts, shares in millions)

Net income	$	750	$	53	$	750	$	53
Dividend equivalent payments	(1)		(1)		(1)		(1)

Income available to common stockholders	$	749	$	52	$	749	$	52

Weighted-average shares outstanding	226.1		225.8		226.1		225.8
Dilutive effect of outstanding options and share-settled awards					0.4		0.4
Adjusted weighted-average shares outstanding					226.5		226.2

Earnings per share	$	3.31	$	0.23	$	3.31	$	0.23

During the first quarters of 2025 and 2024, dividend equivalent payments were made to certain holders of stock options and RSUs. For purposes of computing basic earnings per share, dividend equivalent payments made to holders of stock options and RSUs were deducted from net income to determine income available to common stockholders. For purposes of computing diluted earnings per share, we evaluate on a grant-by-grant basis those stock options and RSUs receiving dividend equivalent payments under the two-class and treasury stock methods to determine which method is more dilutive for each grant. For those grants for which the two-class method was more dilutive, net income was reduced by dividend equivalent payments to determine income available to common stockholders. The dilution calculations exclude options having exercise prices exceeding the average market price of Common Stock as follows: 0.1 million in both the first quarters ended March 31, 2025 and 2024, respectively.

6. Accumulated Other Comprehensive Loss

The changes in the cumulative balances of “Accumulated other comprehensive loss” reported in the Consolidated Balance Sheets consisted of the following:


	Balance at Beginning of Year		Net Income		Reclassification Adjustments		Balance at End of Period
	($ in millions)
Three months ended March 31, 2025
Pensions and other postretirement liabilities	$	(240)	$	—	$	—	$	(240)

Other comprehensive income of equity investees	(22)		1		—		(21)

Accumulated other comprehensive loss	$	(262)	$	1	$	—	$	(261)

Three months ended March 31, 2024
Pensions and other postretirement liabilities	$	(292)	$	—	$	(2)	$	(294)
Other comprehensive loss of equity investees	(28)		—		—		(28)

Accumulated other comprehensive loss	$	(320)	$	—	$	(2)	$	(322)

7. Stock Repurchase Program

We repurchased and retired 1.0 million shares of Common Stock under our stock repurchase program in the first three months of 2025 at a cost of $250 million, inclusive of excise taxes, while we did not repurchase any shares of Common Stock in the first three months of 2024.

8. Investments

Investment in Conrail

Through a limited liability company, we and CSX Corporation (CSX) jointly own Conrail Inc. (Conrail), whose primary subsidiary is Consolidated Rail Corporation (CRC). We have a 58% economic and 50% voting interest in the jointly-owned entity, and CSX has the remainder of the economic and voting interests. Our investment in Conrail was $1.8 billion and $1.7 billion at March 31, 2025 and December 31, 2024, respectively.

CRC owns and operates certain properties (the Shared Assets Areas) for the joint and exclusive benefit of Norfolk Southern Railway Company (NSR) and CSX Transportation, Inc. (CSXT). The costs of operating the Shared Assets Areas are borne by NSR and CSXT based on usage. In addition, NSR and CSXT pay CRC a fee for access to the Shared Assets Areas. “Purchased services and rents” and “Fuel” include expenses payable to CRC for operation of the Shared Assets Areas totaling $49 million and $52 million for the first quarters of 2025 and 2024, respectively. Our equity in Conrail’s earnings, net of amortization, was $16 million and $21 million for the first quarters of 2025 and 2024, respectively. These amounts partially offset the costs of operating the Shared Assets Areas and are included in “Purchased services and rents.”

“Other liabilities” includes $534 million at both March 31, 2025 and December 31, 2024 for long-term advances from Conrail, maturing in 2050 that bear interest at an average rate of 1.31%.

Investment in TTX

We and six other North American railroads collectively own TTX Company (TTX), a railcar pooling company that provides its owner-railroads with standardized fleets of intermodal, automotive, and general use railcars at stated rates. We have a 19.78% ownership interest in TTX.

Expenses incurred for use of TTX equipment are included in “Purchased services and rents.” These expenses amounted to $74 million for both the first quarters of 2025 and 2024. Our equity in TTX’s earnings partially offsets these costs and totaled $11 million and $13 million for the first quarters of 2025 and 2024, respectively.

9. Debt

In June 2024, we entered into an agreement that provides us the ability to issue up to $800 million of unsecured commercial paper and is backed by our credit agreement. The unsecured short-term commercial paper program provides for borrowing at prevailing rates and includes covenants. At March 31, 2025 and December 31, 2024, we had no outstanding commercial paper.

In May 2024, we renewed our accounts receivable securitization program with a maximum borrowing capacity of $400 million. Amounts under our accounts receivable securitization program are borrowed and repaid from time to time in the ordinary course for general corporate and cash management purposes. The term of our accounts receivable securitization program expires in May 2025. Amounts received under this facility are accounted for as borrowings. We had no amounts outstanding under this program and our available borrowing capacity was $400 million at both March 31, 2025, and December 31, 2024. Our accounts receivable securitization program was supported by $870 million and $790 million in receivables at March 31, 2025 and December 31, 2024, respectively, which are included in “Accounts receivable – net”.

In January 2024, we renewed and amended our $800 million credit agreement. The amended agreement expires in January 2029, and provides for borrowings at prevailing rates and includes covenants. We had no amounts outstanding under this facility at either March 31, 2025 or December 31, 2024, and we are in compliance with all of its covenants.

10. Pensions and Other Postretirement Benefits

We have both funded and unfunded defined benefit pension plans covering eligible employees. We also provide specified health care benefits to eligible retired employees; these plans can be amended or terminated at our option. Under our self-insured retiree health care plan, for those participants who are not Medicare-eligible, certain health care expenses are covered for retired employees and their dependents, reduced by any deductibles, coinsurance, and, in some cases, coverage provided under other group insurance policies. Eligible retired participants and their spouses who are Medicare-eligible are not covered under the self-insured retiree health care plan, but instead are provided with an employer-funded health reimbursement account which can be used for reimbursement of health insurance premiums or eligible out-of-pocket medical expenses.

Pension and postretirement benefit cost components were as follows:



	Pension Benefits				Other Postretirement Benefits
	First Quarter
	2025		2024		2025		2024
	($ in millions)
Service cost	$	6	$	6	$	1	$	1
Interest cost	26		27		3		3
Expected return on plan assets	(

SEC Form 10-Q filed by Norfolk Southern Corporation