On August 1, 2024, Cummins Inc (CMI, Financial) released its 8-K filing reporting record second-quarter revenues of $8.8 billion and a GAAP net income of $726 million. Cummins is a leading manufacturer of diesel engines for commercial trucks, off-highway machinery, and railroad locomotives, as well as powertrain components and power generators.
Quarterly Performance Overview
Cummins Inc (CMI, Financial) reported second-quarter revenues of $8.8 billion, a 2% increase from the same quarter in 2023. This performance surpassed analyst estimates of $8.01 billion. The company's diluted earnings per share (EPS) stood at $5.26, significantly higher than the estimated $4.43. The North American market saw a 4% increase in sales, while international revenues decreased by 2%.
Segment Performance
The Power Systems segment was a standout, with sales increasing by 9% to $1.6 billion and segment EBITDA rising to $301 million, or 18.9% of sales. This growth was driven by strong demand in the data center market and industrial sectors.
Other segments showed mixed results:
| Segment | Sales | EBITDA |
|---|---|---|
| Components | $3.0 billion (down 13%) | $406 million (13.6% of sales) |
| Engine | $3.2 billion (up 5%) | $445 million (14.1% of sales) |
| Distribution | $2.8 billion (up 9%) | $314 million (11.1% of sales) |
| Accelera | $111 million (up 31%) | -$117 million |
Financial Achievements and Outlook
For the full year 2024, Cummins Inc (CMI, Financial) has raised its revenue guidance to range from down 3% to flat, an improvement from the previous guidance of down 2% to 5%. EBITDA is now expected to be between 15.0% and 15.5%, up from the prior range of 14.5% to 15.5%.
“We achieved record quarterly sales and solid profitability in the second quarter, led by significant improvement in our Power Systems business,” said Jennifer Rumsey, Chair and CEO of Cummins.
Income Statement Highlights
Key figures from the income statement include:
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Net Sales | $8.8 billion | $8.6 billion |
| Gross Margin | $2.2 billion | $2.1 billion |
| Operating Income | $1.0 billion | $997 million |
| Net Income | $726 million | $720 million |
Balance Sheet and Cash Flow
As of June 30, 2024, Cummins Inc (CMI, Financial) reported total assets of $31.3 billion, with cash and cash equivalents of $1.6 billion. The company’s total liabilities stood at $20.7 billion, and shareholders' equity was $10.6 billion. Net cash used in operating activities for the quarter was $851 million, while net cash used in investing activities was $400 million.
Strategic Initiatives and Future Outlook
Cummins Inc (CMI, Financial) continues to focus on its Destination Zero strategy, aiming to deliver innovative technologies and strengthen its market position. The company announced an increase in its quarterly dividend and highlighted several strategic collaborations, including a joint venture with Daimler Trucks & Buses and PACCAR to advance zero-emissions technology.
Despite challenges such as lower demand in international markets and the separation of the Atmus business, Cummins Inc (CMI, Financial) remains committed to generating strong operating cash flow and returns for shareholders. The company plans to reinvest for profitable growth, pay dividends, and reduce debt.
For more detailed information, please refer to the full 8-K filing.
Explore the complete 8-K earnings release (here) from Cummins Inc for further details.
