Canadian National Railway Company (CNI Quick QuoteCNI - Free Report)  reported second-quarter 2026 adjusted earnings of $1.50 per share (C$2.08), beating the Zacks Consensus Estimate of $1.39 by 7.9%. Adjusted earnings increased 11.2% year over year in Canadian-dollar terms.

Revenues of $3.43 billion (C$4.75 billion) topped the consensus estimate by 5.4% and rose 11.2% year over year. Strong grain and energy volumes supported the performance, while revenue ton-miles, a measure of freight volume, increased 5.1%.

CNI's Freight Revenues Advance Broadly

Freight revenues increased 11.5% year over year to C$4.56 billion. Grain and fertilizers revenues climbed 17.5% year over year, while petroleum and chemicals rose 16.5%. Automotive revenues increased 18.3% year over year, aided by strong imports to Canada and market-share gains.

On a year-over-year basis, intermodal revenues advanced 7.8%, forest products increased 7.4%, and metals and minerals rose 6.5%. Coal revenues were nearly flat. Total carloads slipped 0.4%, but freight revenue per carload increased 11.9% year over year to C$3,236, reflecting improved volume mix and yield.

Canadian National's Costs Weigh on Efficiency

Operating expenses increased 12.8% year over year to C$2.97 billion. Fuel expense surged 59.6% year over year to C$659 million due to higher prices, although stronger fuel efficiency and higher volumes partly tempered the impact. Purchased services and material costs rose 11.3% year over year, while labor and fringe benefits increased 3.1%.

Operating income grew 8.7% year over year to C$1.78 billion. However, the adjusted operating ratio deteriorated 50 basis points to 62.2%, as fuel alone had a 210-basis-point unfavorable impact. The adjusted result excluded C$17 million of advisory costs related to rail consolidation matters.

CNI's Productivity Gains Support Operations

Gross ton-miles increased 3.2% year over year, while gross ton-miles per average employee improved 8.8%. Locomotive utilization rose 6.3% year over year, and train length increased 0.8%. These gains reflected resource alignment, plan discipline and continued emphasis on asset utilization.

Network service measures were mixed. Car velocity declined 0.9% year over year to 211 miles per day, and through dwell increased 4.4% to 7.1 hours. Through network train speed improved 1.1% to 19.1 miles per hour, while the local service commitment rate declined to 93% from 95%.

Canadian National's Cash Flow Remains Solid

Net cash provided by operating activities totaled C$1.61 billion, down 7.7% year over year. Lower investing outflows helped free cash flow increase 2.2% to C$942 million. Gross property additions declined 13.7% to C$695 million.

CNI ended June with C$280 million in cash and cash equivalents compared with C$350 million at 2025-end. Long-term debt increased to C$21.74 billion from C$20.30 billion. The company repurchased 2.9 million shares for C$454 million during the quarter.

CNI Sees Uneven Freight Trends Ahead

Management expects Canadian grain strength in the third quarter due to higher carry-outs from the record 2025-2026 crop. Petroleum and chemicals should benefit from refined-product growth, new crude oil business and added natural gas liquids fractionation capacity.

The outlook is less favorable for international intermodal, where North American imports remain challenging, and lower-profitability volume has been demarketed. Forest products face flat housing starts and U.S. tariffs and duties, while weak iron ore fundamentals remain a drag on metals and minerals.

Canadian National Raises Its 2026 Outlook

Canadian National now expects low-single-digit RTM growth in 2026, up from its prior assumption of flattish growth. The company raised its adjusted diluted earnings growth outlook to the mid-to-high-single-digit range from its earlier expectation for growth slightly above RTM gains.

The railroad continues to plan approximately C$2.8 billion of capital expenditures, net of customer reimbursements. Its updated assumptions include a Canadian dollar value of 71 U.S. cents and West Texas Intermediate crude prices of $80-$110 per barrel. Management also flagged heightened demand risk from volatile macroeconomic conditions, geopolitical conflicts and global trade tensions.

Currently, CNI carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Q2 Performances of Other Transportation Companies

Delta Air Lines (DAL Quick QuoteDAL - Free Report) reported second-quarter 2026 earnings (excluding 88 cents from non-recurring items) of $1.56 per share, beating the Zacks Consensus Estimate of $1.51. Earnings declined in double digits (% wise) from a year ago as sharply higher fuel costs pressured profitability.

Revenues rose on a year-over-year basis to $17.67 billion but missed the consensus estimate of $17.76 billion. Broad demand strength lifted adjusted total revenue per available seat mile, or TRASM, 12.4%, while premium and diversified revenue streams continued to expand.

United Airlines Holdings, Inc. (UAL Quick QuoteUAL - Free Report)  reported second-quarter 2026 adjusted earnings of $1.99 per share, down 48.6% year over year but above the Zacks Consensus Estimate of $1.92 by 3.7%.

Operating revenues rose 16% to $17.67 billion and were essentially in line with the $17.68-billion consensus mark. A 12.1% increase in total revenue per available seat mile, or TRASM, and broad-based gains across premium, loyalty and cargo revenues supported the top line despite sharply higher fuel costs.

J.B. Hunt Transport Services, Inc. (JBHT Quick QuoteJBHT - Free Report) reported second-quarter 2026 earnings of $1.91 per share, up 45.8% from $1.31 a year ago. The figure beat the Zacks Consensus Estimate of $1.71 by 11.7%.

Operating revenues climbed 19.4% year over year to $3.50 billion and surpassed the consensus mark of $3.19 billion by 9.5%. Higher volumes and pricing across several businesses supported growth, led by a 10% increase in Intermodal loads.