"Steve and Karen are both over the moon with little Frankie," a source told the newspaper.
"Her pregnancy did come as a surprise, but now they are both really happy."
This is McFadden's first child with Cairns.
The actor is already dad to Matt, 28, with former partner Sue Marshall; Teona, 19, and Mollie Jane, 12, with Angela Bostock; and Amelie, seven, with Rachel Sidwell.
The news comes just days after McFadden won an "Outstanding Achievement" award at the British Soap Awards 2016.