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NEW YORK - On Friday, Canadian National Railway (NYSE:CNI) reported third-quarter earnings that exceeded analyst expectations, with adjusted earnings per share of C$1.83, beating estimates by C$0.05, while revenue of C$4.17 billion matched consensus forecasts.
CN’s shares rose 1.29% in pre-market trading following the earnings announcement.
The railway operator delivered a 6% increase in diluted EPS on just a 1% rise in revenue ton miles (RTMs) and a 5% increase in carloads. The company’s operating ratio improved by 170 basis points to 61.4%, reflecting strong cost management and operational efficiency.
"Delivered 6% diluted EPS growth on 1% increase in RTMs and strong cost management," said Tracy Robinson, President and Chief Executive Officer. "We’re taking proactive steps to position our cost structure to meet future demand."
The company’s performance was driven by meaningful cost reduction initiatives, with expenses decreasing by 1% mainly due to lower fuel expenses. CN executed C$1 billion in share repurchases during the quarter, reducing its diluted share count by 1%.
Intermodal volumes showed strong growth, benefiting from year-over-year recovery following last year’s labor-related disruption. The company also saw increases in metallurgical coal and petroleum & chemicals segments through targeted growth initiatives.
CN reaffirmed its full-year 2025 guidance, expecting to deliver mid to high single-digit adjusted diluted EPS growth compared to 2024. The company also announced it would reduce its 2026 capital expenditure outlook to C$2.8 billion, down C$550 million from 2025’s C$3.35 billion, which will improve free cash flow.
Management noted that while the environment remains uncertain with soft industrial production impacting demand, the company continues to assume volume growth in terms of RTMs in the low single-digit range versus last year.
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