CN Delivers Strong Third Quarter Performance

Skip to Content News Archives Economy Defence Energy Oil & Gas Renewables Electric Vehicles Mining Commodities Agriculture Real Estate Mortgages Mortgage Rates Finance Banking Insurance Fintech Cryptocurrency Defence Work Wealth Smart Money Wealth Management Investor Personal Finance Family Finance Retirement Taxes High Net Worth FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials More Innovation Information Technology FP500 Podcasts Small Business Lives Told Tails Told Shopping Financial Post Store Obituaries Place a Notice Advertising Advertising With Us Advertising Solutions Postmedia Ad Manager Sponsorship Requests Classifieds Place a Classifieds ad Working Profile Settings My Subscriptions My Offers Newsletters Customer Service FAQ News Economy Energy Mining Real Estate Finance Defence Work Wealth Investor FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials This advertisement has not loaded yet, but your article continues below.HomeGlobeNewswireThis section is The content in this section is supplied by GlobeNewswire for the purposes of distributing press releases on behalf of its clients. Postmedia has not reviewed the content. by GlobeNewswire CN Delivers Strong Third Quarter PerformanceAuthor of the article:Delivered diluted earnings per share (EPS) of C$2.00, an increase of 9% and adjusted diluted EPS of C$2.16, an increase of 18%, or 17% at constant currency (1)Generated free cash flow of C$2,918 million, an increase of 25% for the first nine months of 2026 (consisting of net cash provided by operating activities of C$4,780 million and net cash used in investing activities of C$1,862 million) (1)Realized record third quarter fuel efficiency performance and on track for annual recordRepurchased approximately 3.9 million shares for C$676 million THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountThis advertisement has not loaded yet, but your article continues below.MONTREAL, Oct. 30, 2026 (GLOBE NEWSWIRE) — CN (TSX: CNR) (NYSE: CNI) today reported its financial and operating results for the third quarter ended September 30, 2026.Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try again“I am very proud of CN’s dedicated railroaders for delivering another strong quarter. Their relentless focus on safely executing the plan across our unique network continues to strengthen service, enhance productivity, and support our customers’ success. Together with our disciplined financial management, these rigorous efforts position CN to deliver profitable growth, continue to create long-term value for our shareholders, and capitalize on the opportunities ahead.”– Tracy Robinson, President and Chief Executive Officer, CNThird-Quarter 2026 Results HighlightsCN’s commercial momentum and service performance were supported by a 4% increase in gross ton miles (GTMs) to 116,264 (millions) and a 4% increase in RTMs to 59,383 (millions). The Company delivered diluted EPS of C$2.00, an increase of 9%, and adjusted diluted EPS of C$2.16, an increase of 18%, or C$2.14 on an adjusted basis at constant currency, an increase of 17%. (1)This advertisement has not loaded yet, but your article continues below.The quarter’s operating performance reflects CN’s commitment to strong service execution, enabling its ability to meet customer demand in key markets including grain and energy, while continuing to advance operational improvements through Fast Track.Quarterly Financial Results HighlightsThird-quarter 2026 compared to third-quarter 2025Revenues of C$4,771 million, an increase of C$606 million, or 15%.Operating income of C$1,730 million, an increase of C$124 million, or 8%, and adjusted operating income of C$1,862 million, an increase of C$256 million, or 16%. (1)Operating ratio, defined as operating expenses as a percentage of revenues, of 63.7%, an increase of 230 basis points, and adjusted operating ratio of 61.0%, an improvement of 40 basis points. (1)Net income of C$1,209 million, an increase of C$70 million, or 6%, and adjusted net income of C$1,307 million, an increase of C$168 million, or 15%. (1)Diluted EPS of C$2.00, an increase of 9% and adjusted diluted EPS of C$2.16, an increase of 18%, or C$2.14 on an adjusted basis at constant currency, an increase of 17%. (1)Free cash flow for the first nine months of 2026 was C$2,918 million, an increase of C$577 million, or 25%. (1)Adjusted EBITDA reported for the twelve months ended September 30, 2026 of C$9,080 million, an increase of 5%. (1)Adjusted debt-to-adjusted EBITDA of 2.61 times as at and for the twelve months ended September 30, 2026. (1)Repurchased approximately 3.9 million shares in the third quarter of 2026 for C$676 million.This advertisement has not loaded yet.This advertisement has not loaded yet, but your article continues below.Quarterly Operating Performance Highlights *Third-quarter 2026 compared to third-quarter 2025GTMs increased 4% to 116,264 (millions).RTMs increased 4% to 59,383 (millions).Through dwell increased by 1% to 7.1 (entire railroad, hours).Car velocity decreased by 2% to 207 (car miles per day).Through network train speed decreased by 2% to 19.1 (mph).Fuel efficiency of 0.814 (US gallons of locomotive fuel consumed per 1,000 GTMs), was 2% more efficient.Train length remained flat at 8,083 (feet).GTMs per average number of employees increased 7% to 4,888 (thousands).Operating expenses per GTM increased 14% to 2.62 (cents).* Statistical operating data and key operating measures are unaudited and based on estimated data available at such time and are subject to change as more complete information becomes available.DividendsCN’s Board of Directors has approved a fourth-quarter 2026 dividend on the Company’s common shares outstanding. A quarterly dividend of ninety-one and a half cents (C$0.9150) per common share will be paid on December 30, 2026, to shareholders of record at the close of business on December 9, 2026.This advertisement has not loaded yet, but your article continues below.2026 financial guidance (1)(2) The Company continues to assume to deliver low single-digit RTM growth in 2026. The Company continues to expect adjusted diluted EPS growth in the mid-to-high single-digit range and is currently tracking more towards the upper end of this range.In 2026, CN is still on track to invest approximately C$2.8 billion in its capital program, net of amounts reimbursed by customers. The Company also expects to continue improving its free cash flow conversion throughout 2026.CONFERENCE CALL DETAILSCN’s senior officers will review the results and the railway’s outlook in a conference call starting at 8:30 a.m. Eastern Time on October 30, 2026. Tracy Robinson, CN President and Chief Executive Officer, will lead the call. Parties wishing to participate via telephone may dial 1-800-715-9871 (Canada/U.S.), or 1-647-932-3411 (International), using 5186426 as the passcode. Participants are advised to dial in 10 minutes prior to the call.(1) Non-GAAP MeasuresCN reports its financial results in accordance with United States generally accepted accounting principles (GAAP). CN may also use non-GAAP measures in this news release that do not have any standardized meaning prescribed by GAAP. These non-GAAP measures may not be comparable to similar measures presented by other companies. For further details of these non-GAAP measures, including a reconciliation to the most directly comparable GAAP financial measures, refer to the attached supplementary schedule, Non-GAAP Measures.This advertisement has not loaded yet, but your article continues below.CN’s outlook, guidance or targets (2) exclude certain adjustments, which are expected to be comparable to adjustments made in prior years. However, management cannot individually quantify on a forward-looking basis the impact of these adjustments, which could be significant, are difficult to predict and may be highly variable. As a result, CN does not provide a corresponding GAAP measure for, or reconciliation to, its outlook, guidance or targets.(2) Forward-Looking StatementsCertain statements included in this news release constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and under Canadian securities laws, including statements based on management’s assessment and assumptions and publicly available information with respect to CN. By their nature, forward-looking statements involve risks, uncertainties and assumptions. CN cautions that its assumptions may not materialize and that current economic conditions render such assumptions, although reasonable at the time they were made, subject to greater uncertainty. Forward-looking statements may be identified by the use of terminology such as “believes,” “expects,” “anticipates,” “assumes,” “outlook,” “plans,” “targets,” “goals,” or other similar words.This advertisement has not loaded yet.This advertisement has not loaded yet, but your article continues below.2026 key assumptionsCN has made a number of economic and market assumptions in preparing its 2026 outlook. The 2025/2026 grain crops in Canada and the U.S. were above their respective five-year averages. The Company now assumes that the 2026/2027 grain crops in Canada and the U.S. will be above their respective five-year averages (compared to its January 30, 2026 assumption that the 2026/2027 grain crops in Canada and the U.S. will be in line with their respective five-year averages). CN continues to assume low single-digit RTM growth. CN continues to assume that for the balance of 2026, the value of the Canadian dollar in U.S. currency will be $0.71 and the average price of crude oil (West Texas Intermediate) will be in the range of US$80 – US$110 per barrel. The Company notes there is a heightened demand risk as a result of volatile macroeconomic conditions, geopolitical conflicts and global trade tensions.Forward-looking statements are not guarantees of future performance and involve risks, uncertainties and other factors which may cause actual results, performance or achievements of CN to be materially different from the outlook or any future results, performance or achievements implied by such statements. Accordingly, readers are advised not to place undue reliance on forward-looking statements. Important risk factors that could affect the forward-looking statements in this news release include, but are not limited to, general economic and business conditions, including factors impacting global supply chains such as pandemics and geopolitical conflicts or tensions; trade restrictions, trade barriers, or the imposition of tariffs or other changes to international trade arrangements; industry competition; inflation, currency and interest rate fluctuations; changes in fuel prices; legislative and/or regulatory developments; compliance with environmental laws and regulations; actions by regulators and other regulatory claims or proceedings; increases in maintenance and operating costs; security threats; reliance on technology, including the use of artificial intelligence, and related cybersecurity risk; transportation of hazardous materials; various events which could disrupt operations, including illegal blockades of rail networks, and natural events such as severe weather, droughts, fires, floods and earthquakes; climate change; labor negotiations and disruptions; environmental claims; uncertainties of investigations, proceedings and other types of claims and litigation; risks and liabilities arising from derailments; timing and completion of capital programs; the availability of and cost competitiveness of renewable fuels and the development of new locomotive propulsion technology; reputational risks; supplier concentration; pension funding requirements and volatility; and other risks detailed from time to time in reports filed by CN with securities regulators in Canada and the United States. Reference should also be made to Management’s Discussion and Analysis (MD&A) in CN’s annual and interim reports, Annual Information Form and Form 40-F, filed with Canadian and U.S. securities regulators and available on CN’s website, for a description of major risk factors relating to CN.This advertisement has not loaded yet, but your article continues below.The achievement of CN’s climate goals is subject to several risks and uncertainties, including those disclosed in the MD&A in CN’s annual and interim reports. There can be no certainty that the Company will achieve any or all of these goals within the stated timeframe, or that achieving any of these goals will meet all of the expectations of its stakeholders or applicable legal requirements.Forward-looking statements reflect information as of the date on which they are made. CN assumes no obligation to update or revise forward-looking statements to reflect future events, changes in circumstances, or changes in beliefs, unless required by applicable securities laws. In the event CN does update any forward-looking statement, no inference should be made that CN will make additional updates with respect to that statement, related matters, or any other forward-looking statement. Information contained on, or accessible through, our website is not incorporated by reference into this news release.This earnings news release, as well as additional information, including the Financial Statements, Notes thereto and MD&A, is contained in CN’s Quarterly Review available on the Company’s website at www.cn.ca/financial-results and on SEDAR+ at www.sedarplus.ca as well as on the U.S. Securities and Exchange Commission’s website at www.sec.gov through EDGAR.This advertisement has not loaded yet, but your article continues below.About CNCN powers the economy by safely transporting more than 300 million tons of natural resources, manufactured products, and finished goods throughout North America every year for its customers. With its nearly 20,000-mile rail network and related transportation services, CN connects Canada’s Eastern and Western coasts with the U.S. Midwest and the U.S. Gulf Coast, contributing to sustainable trade and the prosperity of the communities in which it operates since 1919.Contacts: MediaInvestment CommunityAshley MichnowskiJamie LockwoodSenior ManagerVice-President, Investor RelationsMedia Relationsand Special Projects(438) 596-4329(514) 399-0052media@cn.cainvestor.relations@cn.ca SELECTED RAILROAD STATISTICS – UNAUDITED Three months ended September 30 Nine months ended September 30 20262025 20262025Financial measures Key financial performance indicators (1) Total revenues ($ millions) 4,7714,165 13,90312,840Freight revenues ($ millions) 4,5743,991 13,40012,369Operating income ($ millions) 1,7301,606 5,0604,854Adjusted operating income ($ millions) (2)(3) 1,8621,606 5,2264,854Net income ($ millions) 1,2091,139 3,6043,472Adjusted net income ($ millions) (2)(3) 1,3071,139 3,6703,472Diluted earnings per share ($) 2.001.83 5.935.54Adjusted diluted earnings per share ($) (2)(3) 2.161.83 6.035.54Net cash provided by operating activities ($ millions) 1,9041,913 4,7804,822Net cash used in investing activities ($ millions) 8281,120 1,8622,481Free cash flow ($ millions) (2)(4) 1,076793 2,9182,341Gross property additions ($ millions) 8051,105 1,9392,429Share repurchases ($ millions) 676 1,041 1,999 1,448Dividends per share ($) 0.9150 0.8875 2.74502.6625Financial ratio Operating ratio (%) (5) 63.761.4 63.662.2Adjusted operating ratio (%) (2)(3) 61.061.4 62.462.2Operational measures (6) Statistical operating data Gross ton miles (GTMs) (millions) 116,264111,901 355,735344,079Revenue ton miles (RTMs) (millions) 59,38357,188 183,467176,452Carloads (thousands) 1,3641,368 4,1094,095Route miles (includes Canada and the U.S., end of period) 18,90018,900 18,90018,900Employees (end of period) 23,82224,237 23,82224,237Employees (average for the period) 23,78424,408 23,68524,679Key operating measures Freight revenue per RTM (cents) 7.706.98 7.307.01Freight revenue per carload ($) 3,3532,917 3,2613,021GTMs per average number of employees (thousands) 4,8884,585 15,01913,942Operating expenses per GTM (cents) 2.622.29 2.492.32Labor and fringe benefits expense per GTM (cents) 0.750.73 0.750.75Diesel fuel consumed (US gallons in millions) 94.693.2 301.4300.0Average fuel price ($ per US gallon) 6.093.82 5.243.93Fuel efficiency (US gallons of locomotive fuel consumed per 1,000 GTMs) 0.8140.833 0.8470.872Train weight (tons) 9,3709,225 9,3579,141Train length (feet) 8,0838,049 8,0137,923Car velocity (car miles per day) 207211 206204Through dwell (entire railroad, hours) 7.17.0 7.27.2Through network train speed (miles per hour) 19.119.5 18.918.7Locomotive utilization (trailing GTMs per total horsepower) 200191 200188Safety indicators (7) Injury frequency rate (per 200,000 person hours) 0.80 1.18 0.97 1.04Accident rate (per million train miles) 1.51 1.92 2.09 1.84This advertisement has not loaded yet.This advertisement has not loaded yet, but your article continues below.(1)Amounts expressed in Canadian dollars and prepared in accordance with United States generally accepted accounting principles (GAAP), unless otherwise noted.(2)These non-GAAP measures do not have any standardized meaning prescribed by GAAP and therefore, may not be comparable to similar measures presented by other companies.(3)See the supplementary schedule entitled Non-GAAP Measures – Adjusted performance measures for an explanation of these non-GAAP measures.(4)See the supplementary schedule entitled Non-GAAP Measures – Free cash flow for an explanation of this non-GAAP measure.(5)Operating ratio is defined as operating expenses as a percentage of revenues.(6)Statistical operating data, key operating measures and safety indicators are unaudited and based on estimated data available at such time and are subject to change as more complete information becomes available. Definitions of gross ton miles, revenue ton miles, freight revenue per RTM, fuel efficiency, train weight, train length, car velocity, through dwell and through network train speed are included within the Company’s Management’s Discussion and Analysis. Definitions of all other indicators are provided on CN’s website, www.cn.ca/glossary. (7)Based on Federal Railroad Administration (FRA) reporting criteria.This advertisement has not loaded yet, but your article continues below.SUPPLEMENTARY INFORMATION – UNAUDITED Three months ended September 30 Nine months ended September 30 20262025% Change Fav (Unfav) % Change at constant currency (1) Fav (Unfav) 20262025% Change Fav (Unfav) % Change at constant currency (1) Fav (Unfav) Revenues ($ millions) (2) Petroleum and chemicals 1,00085417%16% 2,8692,57711%12%Metals and minerals 56147718%16% 1,5571,4964%5%Forest products 49545110%8% 1,4241,4061%2%Coal 2462374%3% 708725(2%)(2%)Grain and fertilizers 92377519%18% 2,9522,56015%16%Intermodal 1,0659809%8% 3,1142,9286%7%Automotive 28421731%29% 77667715%15%Total freight revenues 4,5743,99115%14% 13,40012,3698%9%Other revenues 19717413%12% 5034717%7%Total revenues 4,7714,16515%14% 13,90312,8408%9%Revenue ton miles (RTMs) (millions) (3) Petroleum and chemicals 12,26011,6625%5% 36,81834,2388%8%Metals and minerals 7,3116,8716%6% 20,39720,697(1%)(1%)Forest products 4,9785,159(4%)(4%) 15,10615,659(4%)(4%)Coal 4,8885,131(5%)(5%) 14,79315,635(5%)(5%)Grain and fertilizers 16,33314,56212%12% 54,22748,32512%12%Intermodal 12,68013,027(3%)(3%) 39,47339,469—%—%Automotive 93377620%20% 2,6532,4299%9%Total RTMs 59,38357,1884%4% 183,467176,4524%4%Freight revenue / RTM (cents) (2)(3) Petroleum and chemicals 8.167.3211%10% 7.797.533%4%Metals and minerals 7.676.9411%9% 7.637.236%6%Forest products 9.948.7414%12% 9.438.985%6%Coal 5.034.629%8% 4.794.643%3%Grain and fertilizers 5.655.326%5% 5.445.303%3%Intermodal 8.407.5212%11% 7.897.426%7%Automotive 30.4427.969%8% 29.2527.875%5%Total freight revenue / RTM 7.706.9810%9% 7.307.014%5%Carloads (thousands) (3) Petroleum and chemicals 1711626%6% 5114797%7%Metals and minerals 2362255%5% 6846771%1%Forest products 69681%1% 206212(3%)(3%)Coal 109122(11%)(11%) 327355(8%)(8%)Grain and fertilizers 18116311%11% 57051810%10%Intermodal 542576(6%)(6%) 1,6491,695(3%)(3%)Automotive 56528%8% 1621592%2%Total carloads 1,3641,368—%—% 4,1094,095—%—%Freight revenue / carload ($) (2)(3) Petroleum and chemicals 5,8485,27211%10% 5,6145,3804%5%Metals and minerals 2,3772,12012%11% 2,2762,2103%4%Forest products 7,1746,6328%7% 6,9136,6324%5%Coal 2,2571,94316%15% 2,1652,0426%6%Grain and fertilizers 5,0994,7557%6% 5,1794,9425%5%Intermodal 1,9651,70116%15% 1,8881,7279%10%Automotive 5,0714,17322%20% 4,7904,25812%13%Total freight revenue / carload 3,3532,91715%14% 3,2613,0218%8%This advertisement has not loaded yet, but your article continues below.(1)This non-GAAP measure does not have any standardized meaning prescribed by GAAP and therefore, may not be comparable to similar measures presented by other companies. See the supplementary schedule entitled Non-GAAP Measures – Constant currency for an explanation of this non-GAAP measure.(2)Amounts expressed in Canadian dollars.(3)Statistical operating data and related key operating measures are unaudited and based on estimated data available at such time and are subject to change as more complete information becomes available. NON-GAAP MEASURES – UNAUDITEDIn this supplementary schedule, the “Company” or “CN” refers to Canadian National Railway Company, together with its wholly-owned subsidiaries. Financial information included in this schedule is expressed in Canadian dollars, unless otherwise noted.CN reports its financial results in accordance with United States generally accepted accounting principles (GAAP). The Company also uses non-GAAP measures that do not have any standardized meaning prescribed by GAAP, including adjusted performance measures, free cash flow, constant currency and adjusted debt-to-adjusted EBITDA multiple. These non-GAAP measures may not be comparable to similar measures presented by other companies. From management’s perspective, these non-GAAP measures are useful measures of performance and provide investors with supplementary information to assess the Company’s results of operations and liquidity. These non-GAAP measures should not be considered in isolation or as a substitute for financial measures prepared in accordance with GAAP.This advertisement has not loaded yet.This advertisement has not loaded yet, but your article continues below.Adjusted performance measuresAdjusted net income, adjusted diluted earnings per share, adjusted operating income, adjusted operating expenses and adjusted operating ratio are non-GAAP measures that are used to set performance goals and to measure CN’s performance and may include the following adjustments:operating expense adjustments: workforce reduction program, advisory costs related to rail consolidation matters, depreciation expense on the deployment of a replacement system, advisory fees related to shareholder matters, asset impairments and held-for-sale recoveries, business acquisition-related costs;non-operating expense adjustments: business acquisition-related financing fees, merger termination income, gains and losses on disposal of property; andthe effect of changes in tax laws including rate enactments and changes in tax positions affecting prior years.These non-GAAP measures do not have any standardized meaning prescribed by GAAP and therefore, may not be comparable to similar measures presented by other companies.This advertisement has not loaded yet, but your article continues below.For the three and nine months ended September 30, 2026, the Company’s adjusted net income was $1,307 million, or $2.16 per diluted share, and $3,670 million, or $6.03 per diluted share, respectively. The adjusted figures for the three and nine months ended September 30, 2026 exclude:asset impairments related to CN’s decision to discontinue the development of certain components of its dispatching and back office information technology projects before completion of $118 million, or $87 million after tax ($0.14 per diluted share) recorded in the third quarter in Asset impairments within the Consolidated Statements of Income, representing the full carrying amount of the affected software components, which had no alternative use and were no longer expected to provide future economic benefits;advisory costs related to the analysis and advocacy for the U.S. Surface Transportation Board (STB) review of the impacts to fair competition pertaining to the potential merger between Union Pacific and Norfolk Southern, including participation in ongoing merger-related regulatory proceedings, discovery activities and efforts to secure competitive access conditions, of $14 million, or $11 million after-tax ($0.02 per diluted share) and $48 million, or $36 million after tax ($0.05 per diluted share), respectively, recorded in Purchased services and material within the Consolidated Statements of Income; andthe sale of a portion of the Newmarket subdivision located in Washago and Sundridge, Ontario, Canada, together with rail fixtures, for cash proceeds of $84 million, which resulted in a gain of $66 million, or $57 million after-tax ($0.09 per diluted share) recorded in the first quarter in Other income within the Consolidated Statements of Income.This advertisement has not loaded yet, but your article continues below.For the three and nine months ended September 30, 2025, the Company’s net income was $1,139 million, or $1.83 per diluted share, and $3,472 million, or $5.54 per diluted share, respectively. There were no adjustments in the third quarter and the first nine months of 2025.Adjusted net income is defined as Net income in accordance with GAAP adjusted for certain significant items. Management believes that adjusted net income provides additional insight to management and investors into the Company’s operations and underlying business trends as well as facilitates period-to-period comparisons, as it excludes certain significant items that are not reflective of CN’s underlying business operations and could distort the analysis of trends in business performance. Adjusted diluted earnings per share is defined as adjusted net income divided by the weighted-average diluted shares outstanding. This measure helps management and investors evaluate the Company’s profitability on a per-share basis, facilitating the assessment of period-over-period performance by removing the impact of significant, non-recurring items.This advertisement has not loaded yet.This advertisement has not loaded yet, but your article continues below.The following table provides a reconciliation of Net income and Earnings per share in accordance with GAAP, as reported for the three and nine months ended September 30, 2026 and 2025, to the non-GAAP adjusted performance measures presented herein: Three months ended September 30Nine months ended September 30In millions, except per share data 2026 2025 2026 2025Net income$ 1,209 $1,139$ 3,604 $3,472Adjustments: Operating expense adjustments: Asset impairments 118 — 118 —Advisory costs related to rail consolidation matters 14 — 48 —Non-operating expense adjustment: Gain on disposal of property — — (66) —Tax adjustment: Tax effect of adjustments (1) (34) — (34) —Total adjustments$ 98 $—$ 66 $—Adjusted net income$ 1,307 $1,139$ 3,670 $3,472Diluted earnings per share$ 2.00 $ 1.83$ 5.93 $5.54Impact of adjustments, per share 0.16 — 0.10 —Adjusted diluted earnings per share$ 2.16 $ 1.83$ 6.03 $5.54(1)The tax impact of adjustments is based on the nature of the item for tax purposes and related tax rates in the applicable jurisdiction.Adjusted operating income is defined as Operating income in accordance with GAAP adjusted for certain significant operating expense items that are not reflective of CN’s underlying business operations. This measure helps management and investors assess the Company’s core operating results by excluding items that may distort the analysis of ongoing business performance. Adjusted operating expenses is defined as Operating expenses in accordance with GAAP adjusted for certain significant operating expense items that are not reflective of CN’s underlying business operations. This measure provides management and investors with a view of ongoing costs which exclude unusual or non-recurring items, enabling more accurate assessment of cost management and resource allocation across reporting periods. Adjusted operating ratio is defined as adjusted operating expenses as a percentage of revenues. For management and investors, the adjusted operating ratio serves as a key performance indicator of cost management and overall operational effectiveness, as it demonstrates how effectively management controls costs relative to total revenue by excluding unusual or non-recurring items.This advertisement has not loaded yet, but your article continues below.The following table provides a reconciliation of Operating income, Operating expenses and operating ratio, as reported for the three and nine months ended September 30, 2026 and 2025, to the non-GAAP adjusted performance measures presented herein: Three months ended September 30Nine months ended September 30In millions, except percentages 2026 2025 2026 2025 Operating income$ 1,730 $1,606 $ 5,060 $4,854 Adjustments: Asset impairments 118 — 118 — Advisory costs related to rail consolidation matters 14 — 48 — Total adjustments$ 132 $— $ 166 $— Adjusted operating income$ 1,862 $1,606 $ 5,226 $4,854 Operating expenses$ 3,041 $2,559 $ 8,843 $7,986 Total adjustments (132) — (166) — Adjusted operating expenses$ 2,909 $2,559 $ 8,677 $7,986 Operating ratio 63.7% 61.4% 63.6% 62.2%Impact of adjustments (2.7)% —% (1.2)% —%Adjusted operating ratio 61.0% 61.4% 62.4% 62.2% Free cash flow is a useful measure of liquidity as it demonstrates the Company’s ability to generate cash for debt obligations and for discretionary uses such as payment of dividends, share repurchases, and strategic opportunities. The Company defines its free cash flow measure as the difference between net cash provided by operating activities and net cash used in investing activities, adjusted for the impact of (i) business acquisitions and combinations; and (ii) merger transaction-related payments, cash receipts and cash income taxes, which are items that are not indicative of operating trends. Free cash flow does not have any standardized meaning prescribed by GAAP and therefore, may not be comparable to similar measures presented by other companies.This advertisement has not loaded yet, but your article continues below.The following table provides a reconciliation of net cash provided by operating activities in accordance with GAAP, as reported for the three and nine months ended September 30, 2026 and 2025, to the non-GAAP free cash flow presented herein: Three months ended September 30Nine months ended September 30In millions 2026 2025 2026 2025 Net cash provided by operating activities$ 1,904 $ 1,913 $ 4,780 $ 4,822 Net cash used in investing activities (828) (1,120) (1,862) (2,481)Free cash flow$ 1,076 $ 793 $ 2,918 $ 2,341 Financial results at constant currency allow results to be viewed without the impact of fluctuations in foreign currency exchange rates, thereby facilitating period-to-period comparisons in the analysis of trends in business performance. Measures at constant currency are considered non-GAAP measures and do not have any standardized meaning prescribed by GAAP and therefore, may not be comparable to similar measures presented by other companies. Financial results at constant currency are obtained by translating the current period results denominated in US dollars at the weighted average foreign exchange rates used to translate transactions denominated in US dollars of the comparable period of the prior year.This advertisement has not loaded yet.This advertisement has not loaded yet, but your article continues below.The weighted average foreign exchange rates were $1.399 and $1.385 per US$1.00 for the three and nine months ended September 30, 2026, respectively and $1.378 and $1.400 per US$1.00 for the three and nine months ended September 30, 2025, respectively. On a constant currency basis, the Company’s net income for the three and nine months ended September 30, 2026 would have been lower by $10 million ($0.02 per diluted share) and higher by $16 million ($0.03 per diluted share), respectively.The following table provides a reconciliation of the impact of constant currency and related percentage change at constant currency on the financial results, as reported for the three and nine months ended September 30, 2026: Three months ended September 30Nine months ended September 30In millions, except per share data 2026 Constantcurrencyimpact 2025 % Change at constant currency Fav (Unfav) 2026 Constantcurrencyimpact 2025 % Change at constant currency Fav (Unfav) Revenues Petroleum and chemicals$ 1,000 $ (9)$854 16%$ 2,869 $16 $2,577 12%Metals and minerals 561 (6) 477 16% 1,557 11 1,496 5%Forest products 495 (6) 451 8% 1,424 10 1,406 2%Coal 246 (2) 237 3% 708 2 725 (2%)Grain and fertilizers 923 (7) 775 18% 2,952 17 2,560 16%Intermodal 1,065 (4) 980 8% 3,114 7 2,928 7%Automotive 284 (3) 217 29% 776 4 677 15%Total freight revenues 4,574 (37) 3,991 14% 13,400 67 12,369 9%Other revenues 197 (2) 174 12% 503 1 471 7%Total revenues 4,771 (39) 4,165 14% 13,903 68 12,840 9%Operating expenses Labor and fringe benefits 871 (5) 815 (6%) 2,674 11 2,597 (3%)Purchased services and material 628 (3) 562 (11%) 1,892 3 1,715 (10%)Fuel 662 (10) 418 (56%) 1,804 16 1,349 (35%)Depreciation and amortization 496 (4) 500 2% 1,466 5 1,482 1%Equipment rents 108 (1) 103 (4%) 326 3 326 (1%)Other 158 (1) 161 2% 563 3 517 (9%)Asset impairments 118 — — —% 118 — — —%Total operating expenses 3,041 (24) 2,559 (18%) 8,843 41 7,986 (11%)Operating income 1,730 (15) 1,606 7% 5,060 27 4,854 5%Interest expense (245) 3 (227)(7%) (720) (5) (679)(7%)Other components of net periodic benefit income 133 — 125 6% 399 — 376 6%Other income 3 — 3 —% 83 — 44 89%Income before income taxes 1,621 (12) 1,507 7% 4,822 22 4,595 5%Income tax expense (412) 2 (368)(11%) (1,218) (6) (1,123)(9%)Net income$ 1,209 $ (10)$1,139 5%$ 3,604 $16 $3,472 4%Diluted earnings per share $ 2.00 $ (0.02)$1.83 8%$ 5.93 $0.03 $5.54 8% Adjusted net income (1)$ 1,307 $ (10)$1,139 14%$ 3,670 $16 $3,472 6%Adjusted diluted earnings per share (1)$ 2.16 $ (0.02)$1.83 17%$ 6.03 $0.03 $5.54 9%This advertisement has not loaded yet, but your article continues below.(1)These non-GAAP measures do not have any standardized meaning prescribed by GAAP and therefore, may not be comparable to similar measures presented by other companies. See the section of this MD&A entitled Adjusted performance measures for an explanation and reconciliation of these non-GAAP measures. Adjusted net income at constant currency and adjusted diluted EPS at constant currency allow results to be viewed without the impact of fluctuations in foreign currency exchange rates, thereby facilitating period-to-period comparisons in the analysis of trends in business performance. For the three months ended September 30, 2026, the Adjusted net income at constant currency was $1,297 million, calculated as adjusted net income of $1,307 million, adjusted for the impact of fluctuations in foreign currency exchange rates of $10 million. For the nine months ended September 30, 2026, the Adjusted net income at constant currency was $3,686 million, calculated as adjusted net income of $3,670 million, adjusted for the impact of fluctuations in foreign currency exchange rates of $16 million. For the three months ended September 30, 2026, the Adjusted diluted EPS at constant currency was $2.14, calculated as adjusted diluted EPS of $2.16, adjusted for the impact of fluctuations in foreign currency exchange rates of $0.02 per diluted share. For the nine months ended September 30, 2026, the Adjusted diluted EPS at constant currency was $6.06, calculated as adjusted diluted EPS of $6.03, adjusted for the impact of fluctuations in foreign currency exchange rates of $0.03 per diluted share. This advertisement has not loaded yet, but your article continues below.Adjusted debt-to-adjusted EBITDA multipleManagement believes that the adjusted debt-to-adjusted EBITDA multiple is a useful credit measure because it reflects the Company’s ability to service its debt and other long-term obligations. The Company calculates the adjusted debt-to-adjusted EBITDA multiple as adjusted debt divided by the last twelve months of adjusted EBITDA. Adjusted debt is defined as the sum of Long-term debt and Current portion of long-term debt as reported on the Company’s Consolidated Balance Sheets as well as Operating lease liabilities, including current portion and pension plans in deficiency recognized on the Company’s Consolidated Balance Sheets due to the debt-like nature of their contractual and financial obligations. Adjusted EBITDA is calculated as Net income excluding Interest expense, Income tax expense, Depreciation and amortization, operating lease cost, Other components of net periodic benefit income, Other income (loss), and other significant items that are not reflective of CN’s underlying business operations and which could distort the analysis of trends in business performance. Adjusted debt and adjusted EBITDA are non-GAAP measures used to compute the adjusted debt-to-adjusted EBITDA multiple. These measures do not have any standardized meaning prescribed by GAAP and therefore, may not be comparable to similar measures presented by other companies.This advertisement has not loaded yet.This advertisement has not loaded yet, but your article continues below.The following table provides a reconciliation of debt and Net income in accordance with GAAP, reported as at and for the twelve months ended September 30, 2026 and 2025, to the adjusted measures presented herein, which have been used to calculate the non-GAAP adjusted debt-to-adjusted EBITDA multiple:In millions, unless otherwise indicatedAs at and for the twelve months ended September 30, 2026 2025 Debt (1)$ 22,812 $21,120 Adjustments: Operating lease liabilities, including current portion (2) 534 452 Pension plans in deficiency (3) 333 341 Adjusted debt$ 23,679 $21,913 Net income$ 4,852 $4,618 Interest expense 954 910 Income tax expense 1,639 1,485 Depreciation and amortization 1,922 1,971 Operating lease cost (4) 150 159 Other components of net periodic benefit income (525) (489)Other income (127) (42)Adjustments: Workforce reduction program (5) 34 — Advisory costs related to rail consolidation matters (6) 63 — Asset impairments (7) 118 — Adjusted EBITDA$ 9,080 $8,612 Adjusted debt-to-adjusted EBITDA multiple (times) 2.61 2.54 (1)Represents the aggregate of Current portion of long-term debt and Long-term debt as disclosed on the Consolidated Balance Sheets.(2)Represents the present value of operating lease payments.(3)Represents the total funded deficit of all defined benefit pension plans with a projected benefit obligation in excess of plan assets.(4)Represents the operating lease costs recorded in Purchased services and material and Equipment rents within the Consolidated Statements of Income.(5)Relates to employee termination benefits and severance costs related to a workforce reduction program, recorded in the fourth quarter of 2025 in Labor and fringe benefits within the Consolidated Statements of Income.(6)Represents advisory costs related to the analysis and advocacy for the STB review of the impacts to fair competition pertaining to the potential merger between Union Pacific and Norfolk Southern recorded in Purchased services and material within the Consolidated Statements of Income.(7)Represents an impairment related to the discontinued development of portions of certain components of its dispatching and back office information technology projects before completion recorded in Asset impairments within the Consolidated Statements of Income. See Note 6 – Properties to the Company’s unaudited Interim Consolidated Financial Statements for additional information.This advertisement has not loaded yet.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.