Cummins beats Q2 expectations as power systems and distribution shine

Published 05/08/2025, 12:50
 Cummins beats Q2 expectations as power systems and distribution shine

Investing.com -- Cummins Inc . (NYSE:CMI) on Tuesday reported second-quarter earnings that significantly exceeded analyst expectations, with adjusted earnings per share of $6.43 beating estimates by $1.17 and revenue of $8.6 billion surpassing the consensus estimate of $8.47 billion.

The engine manufacturer delivered strong profitability despite a 2% YoY revenue decline, driven by record performance in its Power Systems and Distribution segments.

The company’s shares edged up 0.7% following the announcement.

"We delivered strong second quarter results, driven by record profitability in our Power Systems and Distribution segments," said Jennifer Rumsey, Chair and CEO. "Our employees’ resilience and commitment continue to power our success in a dynamic environment."

The company reported EBITDA of $1.6 billion, representing 18.4% of sales, a significant improvement from 15.3% in the same period last year. Net income rose to $890 million from $726 million in the prior-year quarter.

Cummins is navigating contrasting market conditions, with robust demand for power generation equipment but weakness in economically sensitive markets like trucking. North American sales declined 6% while international revenues increased 5%, led by higher demand in Europe and China.

The Power Systems segment was a standout performer with sales up 19% YoY to $1.9 billion and segment EBITDA of $430 million (22.8% of sales). Distribution segment revenue increased 7% to $3.0 billion with EBITDA of $445 million (14.6% of sales).

However, the Engine segment saw an 8% revenue decline to $2.9 billion, while the Components segment fell 9% to $2.7 billion. The Accelera segment, focused on zero-emissions technology, reported a 5% revenue decrease to $105 million with an EBITDA loss of $100 million.

Due to economic uncertainty, Cummins did not reinstate a full-year outlook. The company also announced a quarterly dividend increase from $1.82 to $2.00 per share, marking 16 consecutive years of dividend growth.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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