Photo provided. Cummins Chair and CEO Jennifer Rumsey said Monday that Columbus’ biggest employer is “entering uncharted territory as the trade tariffs start to have a more significant impact beginning in the second quarter.'
Photo provided. Cummins Chair and CEO Jennifer Rumsey said Monday that Columbus’ biggest employer is “entering uncharted territory as the trade tariffs start to have a more significant impact beginning in the second quarter.'
Cummins Inc. reported second-quarter earnings and revenue that topped Wall Street expectations, fueled in large part by what company officials described as strong demand for its power generation systems.

At the same time, the Columbus-based company said it expects demand in the North American truck market to “sharply decline” in the third quarter compared with the prior three-month period due to ongoing uncertainty over tariffs and regulation, as well as a more cautious outlook for freight activity.

Cummins also did not reinstate its full-year financial guidance, citing “continued economic uncertainty.” The company withdrew its guidance in May amid uncertainty over the Trump administration’s tariff policies.

On Tuesday, Cummins reported second quarter revenues of $8.6 billion, down 2% compared to the same quarter last year. Sales in North America declined 6%, while international revenues rose 5% due to higher demand in Europe and China.

Net income in the second quarter was $890 million, or $6.43 per share, up from to $726 million, or $5.26 per share, during the same period last year.

The results topped Wall Street expectations of $8.47 billion in revenue and earnings of $4.99 per share, according to Zacks Equity Research.

While revenue fell 8% in the company’s engine business and 9% in its components compared to the same quarter later year, revenue jumped 19% in its power systems segment and 7% in its distribution business.

Cummins has seen strong demand for its power generation products, including power generators, from data centers that house IT infrastructure to train and deploy artificial intelligence systems.

“We delivered impressive results in the second quarter, led by record performance in our distribution and power systems segments that more than offset the continued softening in the North American truck market,” Cummins Chair and CEO Jennifer Rumsey told analysts on Tuesday.

Segment performances

Engine: Sales of $2.9 billion in the third quarter represented a decrease of 8%. Revenues fell 8% in North America and 7% in international markets due to lower on-highway demand in the United States and Mexico.

Components: Sales of $2.7 billion were down 9% compared to the same quarter last year. Revenues in North America decreased by 15% and international sales were flat primarily due to lower on-highway demand in the United States.

Distribution: Sales of $3 billion represented a 7% increase compared to the third quarter of 2024. Revenues in North America increased 9% and international sales increased by 4% primarily due to increased demand for power generation products in the United States.

Power Systems: Sales of $1.9 billion rose 19% compared to the same period in 2024. Revenues in North America increased 23% and international sales increased 16% driven primarily by increased power generation demand, particularly for the data center and mission critical markets.

Accelera: Sales of $105 million were down 5% compared to the second quarter 2024. Revenues decreased due to lower electrolyzer installations.

Future outlook

Cummins officials said they see a contrast in demand across its markets in the near-term, with “robust demand for power generation equipment,” while orders for trucks in North America have recently reached “multi-year lows.”

Rumsey said the downturn in the North America truck market is being driven by “a number of typical factors and then some atypical factors.” On top of what Rumsey described as the “normal cyclical (downturn) in the truck market” the industry is experiencing “this uncertainty around tariff policy, the impact that’s going to have on the price of trucks and regulatory uncertainty.”

“As we look ahead to the third quarter, we expect North America heavy- and medium-duty truck volumes to decline 25% to 30% from second-quarter levels, as we have seen truck orders recently reach multi-year lows and (original equipment manufacturers) have initiated reduced work weeks through the next three months,” Rumsey said on Tuesday. “The duration of this reduced demand in North America truck markets will largely depend on the trajectory of the broader economy, the evolution of trade and tariff policy and the pace at which regulatory clarity emerges.”

Rumsey said the company “did experience increasing tariff costs in the second quarter,” but “we did not see the full impact of the tariff policies, as supply chains worked through existing inventory.”

“Tariffs are undoubtedly having an impact on Cummins, our suppliers, customers and end users, creating uncertainty over freight activity linked to the movement of goods and increasing costs,” Rumsey said.

Cummins Vice President and Chief Financial Officer Mark Smith said the company expects “the coming months to be much more challenging, primarily for the engine and components segments,” though “it’s cyclical business, and it will rebound.”

“Recent truck orders are at multi-year lows driven by uncertainty due to trade tariffs, product regulation and caution about the expectations for freight,” Smith said. “…We view current order levels are unsustainably low, but immediate catalysts for recovery are not yet clear. We have not yet felt the full impact from tariffs, and there is still uncertainty about duration and ongoing levels, which was highlighted again last week with a flurry of new announcements. It remains to be seen what impact this will have on business confidence and the demand for capital goods beyond trucks.”

Additionally, Smith said he expects that the costs of tariffs will likely be higher for Cummins than the tax benefits the company may see through the tax and spending cut bill that Congress recently passed and signed into law, which President Donald Trump’s has referred to as the “big, beautiful bill.”

“If the taxes are the beautiful part, then the tariffs are definitely not,” Smith said. “The challenge is that the tariff costs have created great uncertainty. …The costs of the tariffs to Cummins … are multiples of the pull forward of tax benefits. …While we’ve done a pretty good job of mitigating tariffs, it’s placing a significant burden on the industries and all the participants.”

Overall, company officials said Cummins’ diversified, global business will help it navigate through the uncertainty and are confident that the company is “well positioned” for the future.

“Despite the challenges in the North America truck market, we have the benefit of operating a diversified, global business and expect continued strength in our power generation market, in addition to stability in our aftermarket and industrial businesses,” Rumsey said.
© 2025 The Republic