Q2 Earnings Performance: CN reported a 2% increase in adjusted EPS to $1.87, driven by margins improving by 50 basis points year-over-year (61.7% operating ratio), despite revenues dipping 1% due to a flat year-over-year in carloads and a 1% decline in RTMs. The company showed strong performance in bulk volumes but faced challenges in merchandise and intermodal segments due to tariffs and a weaker industrial economy.

Volume Outlook Adjustment: CN revised its full-year RTM growth guidance to low single digits, citing ongoing uncertainty from trade tariffs and their impact on customer supply chains. Key sectors affected include Forest Products, metals, and automotive, with expectations that the softness will continue in the near term.

Ongoing Cost Management: The management team emphasized cost containment efforts, managing to keep T&E labor productivity up by 11% year-over-year. This includes furloughs and careful asset management (8,000 cars in storage) to maintain efficiency and protect margins as volumes adjust.