Cummins' third quarter highlights
- Cummins' quarterly common stock cash dividend increased from $1.82 to $2. The company has increased its quarterly dividend for 16 consecutive years.
- Cummins and Komatsu signed a memorandum of understanding to collaborate on heavy mining equipment, specifically, hybrid powertrains.
- Forbes named Cummins one of America's best employers for company culture. It was also rated as a top military-friendly employer by Military Friendly and a Best Place to Work for Disability Inclusion by the Disability Index.
Cummins says cost management helped as North American truck sales dove on the third quarter. Propped up by growth in power systems and distribution, CEO Jennifer Rumsey called quarterly results "strong" for the company.
"Cummins delivered strong operating results in the third quarter, driven by profitable growth in our power systems and distribution segments, due in part to continued rising demand for backup power for data centers," Rumsey says. "Effective cost management across the company helped navigate through the anticipated sharp decline in the North American truck market."
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The quarter also say non-cash charges related to the electrolyzer business, part of Accelera, reflecting policy shifts' effects on hydrogen adoption.
"Due to the significantly weaker prospects for demand, we are undertaking a strategic review of the electrolyzer business," Rumsey says.
Cummins' Q3 by the numbers
Revenues were off 2% year over year, settling at $8.3 billion. Sales in North America were down 4% and international revenues were down 2%, helped by higher demand in China and Europe.
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Net income was $536 million, down 41% from 2024. Earnings before interest, taxes, depreciation and amortization (EBITDA) were $1.2 billion — 14.3% of sales. That's down from $1.4 billion and 16.4% of sales a year ago.
Sales in the engine segment were down 11% to $2.6 billion with a segment EBITDA of $261 million or 10% of sales, compared to $427 million and 14.7% of sales a year ago. Revenues were down 12% in North America and 5% in international markets due to lower medium- and heavy-duty truck demand, particularly in the United States and Mexico.
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Components sales were down 15% to $2.3 billion with a segment EBITDA of $292 million or 12.5% of sales. North American revenues again sank 24% and international sales were flat. This, too, was driven by lower demand in the U.S., Cummins says.
A bright spot comes in the distribution segment, where sales were up 7% to $3.2 billion. Its EBITDA was $492 million or 15.5% of sales, compared to $370 million or 12.5% of sales in 2024. Revenues were up 13% in the U.S. on increased demand for power generation. International sales, however, were down 3%.
Sales in power systems hit $2 billion, up 18% year over year as revenues in North America jumped 20% and international sales were up 17%. Cummins says the segment's EBITDA was $457 million, or 22.9% of sales and the increases were driven by increased power generation demand in data center markets in North America, India and China.
Accelera, the zero-emissions segment, saw sales of $121 million, up 10% over 2024. However, it notched an EBITDA loss of $336 million, including $240 million of non-cash charges related to goodwill impairment and inventory write-downs. Revenues were up, Cummins says, on higher demand but continued investments in the most promising zero-emissions technologies led to the EBITDA losses.
What does Cummins see in the future?
Cummins says it will not be providing an outlook for revenue or profitability this year.
"While uncertainty in a number of our end markets persists, our strong third quarter results are a testament to our diversified portfolio, effective cost discipline and commitment to delivering for our customers," Rumsey says. "Cummins continues to operate from a position of strength as we navigate this dynamic environment and we look forward to reinstating our financial guidance in February when we provide our outlook for 2026."
