ºÚÁϳԹÏÍø

"We've not seen a significant impact to our volumes thus far, but there's no question that uncertainty has increased over the last few months, and we're seeing a heightened risk of recession in both Canada and the U.S.," chief executive Tracy Robinson told analysts on a conference call.

"It's difficult to say what will happen from here. While we remain optimistic that the U.S. will ultimately reach trade agreements with Canada, China and other countries, we don't know what those deals will look like, nor when they will happen."

Despite a slowdown in February caused by frigid weather and snow, CN boosted year-over-year revenues for grain and fertilizers as well as petroleum and chemicals — two of its biggest segments.

Cargo volumes as measured in revenue ton miles – a key metric gauging how many tons of freight are hauled in a mile – increased one per cent year-over-year.

However, revenue from container shipments, auto loads, forest products and metals and minerals fell, partly reflecting the hit from tariffs and broader uncertainty around trade policies.

Some customers paused shipments or scaled down production and inventory, said chief commercial officer Remi Lalonde.

Blank sailings – when an ocean carrier cancels a sailing or skips a port – have also surged over the past month as a result of the U.S.-China trade war, denting container volumes, especially on the West Coast of the U.S.

"The tariffs are starting to bite and we're seeing that in the intermodal business," Lalonde said. "We're going to see a bit of an air pocket here looking out through the end of the year."

With tariff barriers rising, he stressed the potential for higher cargo volumes domestically in both Canada and the U.S., particularly for refined petroleum, steel and lumber. The latter two industries are feeling the pain of U.S. duties more acutely than many sectors.

The degree of a domestic ramp-up will hinge partly on how fully Prime Minister Mark Carney can realize his goal of "free trade" within Canada by July 1, executives noted.

On the call, Scotiabank analyst Konark Gupta pointed out that while CN's financial outlook remains the same, "things have changed obviously in the market in these three months."

"A lot of people are concerned about the macro environment, clearly," he told Robinson.

The CEO acknowledged that "the range of possibilities here is quite wide" for company earnings amid ongoing trade volatility.

"We did expect uncertainty. It's probably more — it's definitely more — uncertain than it would have been as we were putting the plan together in January," she said.

Nonetheless, CN reported that net income climbed five per cent to $1.16 billion in the first quarter from $1.10 billion the year before.

Revenues increased four per cent to $4.40 billion in the three months ended March 31 from $4.25 billion in the same period a year earlier, the Montreal-based company stated.

Diluted earnings per share jumped nearly eight per cent to $1.85 from $1.72.

In a release Thursday, CN said its financial forecast for 2025 remains unchanged, but stressed the "heightened recessionary risk related to tariffs and trade actions" taken by the U.S. and other countries.

This report by ºÚÁϳԹÏÍø was first published May 1, 2025.

Companies in this story: (TSX:CNR)