Canadian corporate profits rose in the first quarter of 2025, driven by strong results in banking and energy. Net income before taxes reached $161.2 billion, up 2.7 per cent from the previous quarter, according to data released Friday by Statistics Canada.
The financial sector accounted for much of the gain, with net income climbing 7.2 per cent to $47.2 billion. Banks and other credit institutions led the charge, posting a $2.8 billion increase, due to higher interest income. Life and health insurers also saw improved earnings, while property and casualty insurers faced a $733 million decline as claim costs rose.
Non-financial industries posted a smaller overall increase of 0.9 per cent, totalling $113.9 billion. The oil and gas extraction industry recorded the largest gain, with profits up $3.8 billion. The rise was linked to higher crude oil prices and stronger export volumes, alongside gains from foreign exchange adjustments.
Petroleum and coal product manufacturers rebounded with a $1.5 billion increase after four straight quarters of decline. Construction profits also rose, adding $383 million on higher revenues. The pipeline transportation industry saw earnings climb $281 million as exports to the United States picked up amid trade uncertainty.
Not all sectors saw improvement. The alcohol, tobacco and cannabis industry reported a $3.4 billion drop in profits, mainly due to legal settlement costs. The motor vehicle and trailer manufacturing sector posted a $1.3 billion decline, as one-time income from the previous quarter was not repeated.
The first-quarter increase marks the fourth straight quarterly gain for Canadian corporate earnings, suggesting a steady, if uneven, recovery across sectors. Analysts say continued strength in finance and energy could support growth through the rest of the year, though legal costs and global trade pressures remain key risks.