CN reported Tuesday that it achieved record first quarter revenue ton miles while posting a 1% increase in diluted earnings per share, as the railway company delivered strong operational performance despite ongoing macroeconomic uncertainty.
The Montreal-based company said revenue ton miles increased 3% to 61,834 million in the first quarter, setting a new first quarter record. Free cash flow rose 44% to C$900 million, consisting of net cash provided by operating activities of C$1.265 billion and net cash used in investing activities of C$365 million.
“I want to thank the entire CN team for delivering on our plan, despite ongoing uncertainty in the macro environment,” said Tracy Robinson, president and chief executive officer. “Our strong commercial and operating performance allow us to fully leverage the strength of our network, enabling us to capture incremental volume.”
Financial results show mixed performance
CN reported first quarter revenues of C$4.379 billion, a decrease of C$24 million, or 1%, compared to the same period last year. Operating income fell 4% to C$1.549 billion.
Diluted earnings per share reached C$1.87, an increase of 1%, though adjusted diluted EPS decreased 3% to C$1.80. On an adjusted basis at constant currency, diluted EPS was C$1.83, a decrease of 1%.
The company said financial performance in the quarter was negatively impacted by higher year-over-year costs related to winter conditions, incidents and a higher effective tax rate.
Operational metrics show improvements
The railway achieved its best first quarter employee productivity in the last five years and record fuel efficiency performance. Gross ton miles increased 3% to 118,389 million.
Fuel efficiency improved 3% to 0.892 U.S. gallons of locomotive fuel consumed per 1,000 gross ton miles. Car velocity increased 6% to 201 car miles per day, while through network train speed rose 6% to 18.7 mph.
CN repurchased approximately 6 million shares in the first quarter for C$869 million.
Dividend and shelf prospectus announced
CN’s board of directors approved a second-quarter 2026 dividend of 91.5 cents Canadian (C$0.9150) per common share, payable June 30 to shareholders of record at the close of business on June 9.
The company also filed a shelf prospectus with Canadian securities regulators and a registration statement with the U.S. Securities and Exchange Commission, allowing it to issue debt securities in Canadian and U.S. markets over the next 37 months. The filing replaces CN’s previous shelf prospectus set to expire on May 3.
CN expects to use proceeds for general corporate purposes, including debt refinancing, share repurchases, acquisitions and other business opportunities.
2026 guidance maintained
CN continues to assume that volume growth in terms of revenue ton miles will be flat. The company expects adjusted diluted EPS growth will slightly exceed volume growth.
The railway still plans to invest approximately C$2.8 billion in its capital program in 2026, net of amounts reimbursed by customers.
