CPKC Revenue Rises 15% to C$4.219 Billion in Third Quarter

Key Facts

Canadian Pacific Kansas City said on October 28 that total revenue rose to C$4.219 billion in the third quarter of 2026, from C$3.661 billion in the same period a year earlier. Freight volumes, measured in revenue ton-miles, increased 6% year over year, according to the company statement published via PR Newswire. Reported diluted earnings were C$1.04 per share, up 3% from C$1.01 a year earlier, while core adjusted diluted earnings rose 16% to C$1.28 from C$1.10. However, net income attributable to shareholders was C$917 million, compared with C$920 million in the third quarter of 2025, according to Investing.com. The results show a divergence between revenue growth and adjusted earnings per share on one hand, and a slight decline in net income on the other. The results were announced after markets closed on October 28, while adjusted earnings fell short of the market estimate of C$1.31 per share, despite revenue matching expectations at C$4.2 billion.

Grain and intermodal activity accounted for part of the revenue growth, with grain revenue rising to C$904 million from C$702 million in the year-earlier period. Intermodal revenue increased to C$815 million from C$668 million, according to Investing.com figures. Across freight, the company reported total revenue of C$4.139 billion, compared with C$3.589 billion a year earlier, an annual increase of C$550 million, according to its statement. The figures reflect broader revenue growth across freight operations alongside a 6% increase in volumes, without indicating that every business segment posted the same increase. In the second quarter of 2026, revenue was C$4.2 billion, up 13% year over year, according to the company’s filing with the U.S. Securities and Exchange Commission. Third-quarter reported revenue growth was therefore higher than the rate recorded in the previous quarter, with each quarter compared with the corresponding period a year earlier.

Higher operating activity was accompanied by increased expenses; total operating expenses rose to C$2.732 billion from C$2.325 billion in the third quarter of 2025. Compensation and benefits expenses also increased to C$711 million from C$619 million. The company said higher fuel prices had a negative impact of 170 basis points on the reported operating ratio and 190 basis points on the core adjusted ratio. The reported operating ratio rose to 64.8% from 63.5%, while the core adjusted ratio increased to 61.9% from 60.7%. An increase in the operating ratio means expenses account for a larger share of revenue; higher fuel costs alone do not explain the change in profitability, as other operating expense items also rose during the period.

Chief Executive Keith Creel said, "The railway is operating at a very high level of efficiency, our service remains strong, and we continue to deliver growth in our key markets." The company added in its statement that it faced economic headwinds while service remained strong and growth continued in grain, intermodal and merchandise markets. Management linked its annual commitment to disciplined execution and a strong commercial pipeline, and said it remained on track to meet its 2026 commitments. The comments came as the company recorded growth in freight volumes and revenue, alongside increases in expenses and operating ratios. In its coverage of the earnings call, Investing.com reported that management expected the operating ratio to come in below 60% in the fourth quarter. Management also expected year-over-year volume growth to continue in the mid-single digits, according to the same coverage.

The adjusted earnings miss was reflected in the stock’s trading, with shares falling 1.87% in regular trading on October 28 to US$89.43, then dropping a further 3.57% after the close to US$86.24, according to Investing.com. The report said the US$89.43 price was recorded before the results were published, while the additional decline came after the announcement. EL7 data showed CP shares closing at 91.13 on October 27 and 89.43 on October 28, without specifying the currency. The company scheduled its earnings call with the financial community for 4:30 p.m. Eastern time on October 28, a time that had passed when the news was reviewed the next day. The company made a replay of the call available through November 4, 2026, according to its statement. The call covered both the third-quarter results and management’s fourth-quarter outlook, including a target operating ratio below 60%.