What happened

Shares of railroad operator CSX Corporation (NASDAQ:CSX) are down 9.8% as of 2:12 p.m. EDT after the company reported second-quarter 2019 earnings results last night that fell short of expectations.

Analysts had forecast that CSX would earn $1.10 per share on sales of $3.14 billion. Instead, CSX earned $1.08 per share in its fiscal Q2 on sales of $3.06 billion.

Train heading into the sunset.

Image source: Getty Images.

So what

However, this is not to say that earnings were "bad," necessarily. Although $1.08 per share was less than Street analysts had hoped CSX would earn, these profits were still up 7% in comparison to last year's Q2. And this was despite a 1% year-over-year decline in revenue.

CSX CEO James Foote credited a 3% reduction in costs and "continued efficiency gains and volume-related savings" for keeping profits growing even in the face of a sales slip.

Now what

So why is CSX stock trading down? I blame guidance.

Heading into Q2, analysts were forecasting that CSX's sales would rise 1% or 2% this year, helping to keep the earnings growth going. However, in the postearnings conference call, Foote warned that instead of rising, revenues will probably fall 1% or 2% this year.

This warning raises the possibility that Q2 won't be the last quarter in which CSX "misses earnings" -- it could continue to miss all year long.

No wonder investors are worried. No wonder investors are...selling.