Russian railways in deep crisis: Ukrainian intelligence reveals details
Photo: Russian railways are in deep crisis (Russian media)
Russia's state-owned railway giant is steadily sinking into crisis, marked by serious financial losses and a sharp decline in cargo shipments for the third consecutive year, Ukraine's Foreign Intelligence Service reports.
"In the first half of 2025, the financial condition of Russian Railways (RZD) continued to deteriorate rapidly. Cargo volumes fell by 7.3% year-over-year, with the biggest drops in grain shipments (-35.6%), industrial goods (-19.4%), and construction materials (-17%)," the statement says.
The company's net profit plunged by 95%, down to just $33.9 million. Due to the shrinking cargo flow, Russian Railways is expected to fall short of $1.1 billion in projected revenue for 2025. Meanwhile, the company's updated financial plan is seen as unrealistic, especially amid growing debt pressure and declining profitability.
Forced unpaid leave and fear of unrest
RZD has slashed investment spending and suspended infrastructure projects aimed at boosting exports to China. Since July, employees have been forced to take two unpaid leave days each month. Despite that, the company still arms 30,000 security personnel with firearms up to 20mm caliber - a fact that raises concerns about the potential for social unrest if tensions escalate.
Corruption scandals erupt at top
"The crisis is unfolding against the backdrop of corruption scandals. Top executives are embezzling millions. One recent example: on August 2, RZD's director of the energy complex, Valentin Sanko, was arrested for allegedly misappropriating over $18.5 million,"
Despite Russian Railways' strategic role in the economy, analysts believe state support is unlikely to be effective, given the country's ballooning budget deficit.
As previously reported, cyber specialists from Ukraine's Main Intelligence Directorate (HUR) launched a series of successful cyberattacks on RZD's systems from June 10 to 12.
The company's website and mobile services were disrupted, preventing Russians from purchasing train tickets online for an extended period. The most complaints came from St. Petersburg, Tver, and Sverdlovsk regions.
