Cummins (CMI) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenues were $8.2 billion, down 3% year-over-year, with net income of $824 million ($5.96 per diluted share), reflecting the absence of the prior year's $1.3 billion Atmus divestiture gain.

• EBITDA was $1.5 billion (17.9% of sales), up from an adjusted 15.5% margin a year ago, with record Power Systems performance and strong Distribution growth.

• Distribution and Power Systems segments posted double-digit sales and EBITDA growth, while Engine and Components declined due to market softness and the Atmus separation.

• Full-year 2025 guidance was withdrawn due to significant uncertainty from tariffs, regulatory changes, and global economic conditions.

• Strategic initiatives included new engine launches (X10, B7.2), decarbonization investments, and the acquisition of First Mode assets.

Financial highlights

• Q1 2025 revenues were $8.2 billion, down 3% year-over-year; North America revenues decreased 1%, international revenues down 5%.

• Adjusted EBITDA was $1.5 billion (17.9% margin), up from $1.3 billion (15.5%) a year ago; net income was $824 million, or $5.96 per diluted share.

• Gross margin improved to $2.2 billion (26.4% of sales), up from $2.04 billion (24.5%).

• Operating income rose to $1.13 billion from $923 million year-over-year.

• Operating cash flow was an outflow of $3 million, compared to an inflow of $276 million last year, mainly due to higher working capital.

Outlook and guidance

• Full-year 2025 guidance was withdrawn due to heightened uncertainty from tariffs, regulatory changes, and global economic conditions.

• Tariff impacts are expected to increase in Q2 and H2 2025, with low visibility on demand and cost recovery.

• Management plans to reinstate guidance when economic and regulatory clarity improves.