Cummins Q2 Earnings Surpass Estimates, Revenues Decline Y/Y

Cummins Inc. CMI reported second-quarter 2025 earnings of $6.43 per share, which surpassed the Zacks Consensus Estimate of $4.99 and increased from $5.26 recorded in the corresponding quarter of 2024. Higher-than-expected sales in the Distribution and Power Systems segments resulted in the outperformance. Cummins’ revenues totaled $8.64 billion, which beat the Zacks Consensus Estimate of $8.47 billion but declined from $8.8 billion recorded in the year-ago quarter. Cummins Inc. Price, Consensus and EPS Surprise Cummins Inc. price-consensus-eps-surprise-chart | Cummins Inc. QuoteKey TakeawaysIn the reported quarter, sales in the Engine segment were down 8% year over year to $2.90 billion. The metric also missed our estimate of $2.91 billion. Sales in North America and International markets decreased 8% and 7% year over year, respectively, due to weaker on-highway demand in the United States and Mexico. The segment’s EBITDA fell to $400 million (accounting for 13.8% of sales) from $445 million (14.1% of sales) in the year-ago period and missed our estimate of $428.4 million.Sales in the Distribution segment totaled $3 billion, which rose 7% year over year and topped our projection of $2.83 billion. Sales in North America rose 9% due to increased demand for power generation products, while international sales rose by 4%. The segment’s EBITDA came in at $445 million (14.6% of sales), which increased from the year-ago quarter’s $314 million (11.1% of sales) and surpassed our estimate of $366 million.Sales in the Components segment totaled $2.7 billion, down 9% from the prior-year quarter. Sales also missed our estimate of $2.74 billion. Revenues in North America decreased 15% and international sales were flat due to weaker on-highway demand in the United States. The segment’s EBITDA was $397 million (14.7% of sales), lower than the year-ago figure of $406 million (13.6% of sales). The metric, however, topped our estimate of $373.6 million.Sales in the Power Systems segment rose 19% from the year-ago quarter to $1.9 billion and beat our estimate of $1.64 billion. While North America sales grew 23%, international sales rose 16% due to increased demand for power generation. The segment’s EBITDA rose to $430 million (22.8% of sales) from $301 million (18.9% of sales) and beat our estimate of $327.6 million.Sales in the Accelera segment came in at $105 million, which fell 5% from the year-ago level and lagged our estimate of $112.5 million. The segment incurred a pretax loss of $100 million, narrower than our estimate of a loss of $102.5 million. Investment in zero-emission contributed to the EBITDA losses.CMI's FinancialsCummins’ cash and cash equivalents were $2.32 billion as of June 30, 2025, up from $1.67 billion as of Dec. 31, 2024. Long-term debt totaled $6.81 billion, up from $4.78 billion as of Dec. 31, 2024.Cummins’s Zacks Rank & Key PicksCMI carries a Zacks Rank #3 (Hold) at present.Some better-ranked stocks in the auto space are Ferrari N.V. RACE, PHINIA Inc. PHIN and XPeng Inc. XPEV. While RACE and PHIN sport a Zacks Rank #1 (Strong Buy) each at present, XPEV carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here. The Zacks Consensus Estimate for RACE’s fiscal 2025 earnings and sales indicates year-over-year growth of 12.1% and 13.48%, respectively. EPS estimates for fiscal 2025 and 2026 have improved 5 cents each over the past 30 days.The Zacks Consensus Estimate for PHIN’s 2025 sales and earnings implies year-over-year growth of 0.58% and 13.99%, respectively. EPS estimates for 2025 and 2026 have improved 23 cents and 19 cents, respectively, in the past 30 days.The Zacks Consensus Estimate for XPEV’s 2025 sales and earnings indicates year-over-year growth of 102% and 66.7%, respectively. EPS estimates for 2025 have improved 7 cents in the past 90 days. The same for 2026 has increased by a penny in the past 60 days.Beyond Nvidia: AI's Second Wave Is HereThe AI revolution has already minted millionaires. But the stocks everyone knows about aren't likely to keep delivering the biggest profits. Little-known AI firms tackling the world's biggest problems may be more lucrative in the coming months and years.See "2nd Wave" AI stocks now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Cummins Inc. (CMI): Free Stock Analysis Report Ferrari N.V. (RACE): Free Stock Analysis Report XPeng Inc. Sponsored ADR (XPEV): Free Stock Analysis Report PHINIA Inc. (PHIN): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks