Earnings Per Share

12 Months Ended

Dec. 31, 2022

The following table sets forth the computation of basic earnings per share and earnings per share, assuming dilution:


	Years Ended
	2022		2021		2020
Numerator (Dollars in Millions):
Net Earnings	$	4,166	$	3,781	$	2,765
Dividend Equivalents on Restricted Stock	—		—		—
Net Earnings, Attributable to Common Shareholders	$	4,166	$	3,781	$	2,765

Denominator (Units in Millions):
Average Common Shares Outstanding	2,136		2,250		2,300
Other Potentially Dilutive Common Shares	5		5		5
Average Common Shares Outstanding, Assuming Dilution	2,141		2,255		2,305

Net Earnings Per Share, Basic	$	1.95	$	1.68	$	1.20
Net Earnings Per Share, Assuming Dilution	$	1.95	$	1.68	$	1.20

Basic earnings per share is based on the weighted-average number of shares of common stock outstanding. Earnings per share, assuming dilution, is based on the weighted-average number of shares of common stock outstanding and common stock equivalents adjusted for the effects of common stock that may be issued as a result of potentially dilutive instruments. CSX's potentially dilutive instruments are made up of equity awards including performance units and employee stock options.

When calculating diluted earnings per share, the potential shares that would be outstanding if all outstanding stock options were exercised are included. This number is different from outstanding stock options, which is included in Note 4, Stock Plans and Share-Based Compensation, because it is offset by shares CSX could repurchase using the proceeds from these hypothetical exercises to obtain the common stock equivalent. The total average outstanding equity awards that were excluded from the diluted earnings per share calculation because their effect was antidilutive is in the table below.


	Years Ended
	2022	2021	2020
Antidilutive Stock Options Excluded from Diluted EPS (in millions)	3	2	6

Share Repurchase Programs

During July 2022, the share repurchase program announced in October 2020 was completed and the Company began repurchasing shares under the $5 billion share repurchase program approved on July 19, 2022. Total repurchase authority remaining was $3.3 billion as of December 31, 2022. Previously, shares were repurchased under a program announced in January 2019 that was completed in June 2021.

NOTE 2. Earnings Per Share, continued

Share repurchases may be made through a variety of methods including, but not limited to, open market purchases, purchases pursuant to Rule 10b5-1 plans, accelerated share repurchases and negotiated block purchases. The timing of share repurchases depends upon management's assessment of marketplace conditions and other factors, and the program remains subject to the discretion of the Board of Directors. Future share repurchases are expected to be funded by cash on hand, cash generated from operations and debt issuances. Shares are retired immediately upon repurchase. In accordance with the Equity Topic in the Accounting Standards Codification ("ASC"), the excess of repurchase price over par value is recorded in retained earnings.

Share Repurchase Activity

During 2022, 2021 and 2020, CSX repurchased the following shares:


	Years Ended
	2022		2021		2020
Shares Repurchased (Units in Millions)	151		90		38
Cost of Shares (Dollars in Millions)	$	4,731	$	2,886	$	867
Average Price Paid per Share	$	31.25	$	31.91	$	22.90

Structured Share Repurchases

Periodically, CSX enters into structured agreements for the repurchase of CSX shares. Upon execution of each agreement, the Company pays a fixed amount of cash in exchange for the right to receive either CSX stock or a predetermined amount of cash, including a premium. Shares acquired through these structured share repurchase agreements were recorded in common stock and retained earnings and are included in the share repurchases table above. There were no repurchases under a structured agreement in 2022.

As a result of entering into and settling structured share repurchase agreements, the Company paid a net total of approximately $378 million and received approximately 12 million shares during the year ended 2021. Premiums received were not material.

In December 2020, the Company completed a structured share repurchase. Under this agreement, the Company paid a total of $100 million and received approximately 3.3 million shares.

Dividend Increase

On February 14, 2023, the Company's Board of Directors authorized a 10% increase in the quarterly cash dividend to $0.11 per common share effective March 2023.