Cummins reports record Q2 2024 quarterly sales

Cummins Inc. has reported strong results for the second quarter of 2024, including record quarterly sales and solid profitability, per Jennifer Rumsey, Cummins chair and CEO. She attributed the company’s strong performance to the success of its ongoing zero-emission strategy.

Jennifer Rumsey, Cummins chair and CEO. (Photo: Cummins)

“As we shared during our Analyst Day in May, our Destination Zero strategy is the right strategy for growing our business and meeting our customers’ needs today and in the future. We continue to deliver innovative technologies for our customers, execute on our financial commitments and strengthen our position in key markets,” she said. She went on to thank the company’s employees “for their continued efforts to drive business results and make Cummins more competitive across the globe.”

Second quarter revenues were up 2% to $8.8 billion compared to the same quarter in 2023. Sales in North America increased 4% while international revenues decreased 2%.

Net income attributable to Cummins in Q2 2024 was $726 million, versus $720 million in Q2 2023. Earnings before interest, taxes, depreciation and amortization (EBITDA) were $1.3 billion or 15.3% of sales, compared to $1.3 billion or 15.1% of sales for the same period a year ago. Both Q2 2023 net income and EBITDA reflected costs of $23 million related to the separation of Atmus.

By business segment

Cummins reported the following Q2 2024 details by sector versus Q2 2023:

• Components Segment: Sales were down 13% to $3.0 billion. EBITDA was $406 million or 13.6% of sales, compared to $486 million or 14.2% of sales. Revenues decreased 10% in North America and international sales fell 17% primarily due to the separation of Atmus and lower demand in China and Europe.
• Engine Segment: Sales rose 5% to $3.2 billion with EBITDA of $445 million or 14.1% of sales, versus $425 million or 14.2% of sales. Revenues rose 7% in North America and 2% in international markets due to strong demand in the North American medium-duty truck market and pricing actions.
• Distribution Segment: Sales increased 9% to $2.8 billion. EBITDA was at $314 million or 11.1% of sales, compared to $299 million or 11.5% of sales. Revenues increased in both North America (6%) and internationally (16%) driven by increased demand for power generation products and pricing actions.
• Power Systems Segment: Sales grew 9% to $1.6 billion, with EBITDA of $301 million or 18.9% of sales, versus $201 million or 13.8% of sales. Power generation revenues grew double digits (16%) on increased global demand, particularly for the data center market. Industrial revenues rose 2%, with strong mining demand offsetting weaker demand in oil and gas markets.
• Accelera Segment: The segment saw sales grow by 31% to $111 million based on increased electrolyzer installations. However, EBITDA was a loss of $117 million due to costs associated with the development of electric powertrains, fuel cells and electrolyzers as well as products to support battery-electric vehicles, the company stated.

Outlook for FY 2024

Based on its current forecast, Cummins has raised its full-year 2024 revenue guidance to be down 3% to flat, due to stronger than expected demand across several markets, especially in North America on-highway and power generation. EBITDA is expected to be in the range of 15.0% to 15.5%, raising the midpoint and narrowing the range of the previous guidance of 14.5% to 15.5%.

“We have raised our expectations on revenue and profitability for 2024 due to continued demand for Cummins’ products and services. We still expect slowing demand in the North America heavy-duty truck market in the second half of the year,” said Rumsey. “Despite the lower outlook for the second half, Cummins is in a strong position to keep investing in future growth, bringing new technologies to customers and returning cash to shareholders.”