Cummins beats quarterly estimates on strong power generation demand

Published 02/04/2025, 09:10 AM
Updated 02/04/2025, 09:16 AM
© Reuters. FILE PHOTO: Signage for Cummins is seen during the Association of the United States Army annual meeting and exposition at the Walter E. Washington Convention Center in Washington, U.S., October 14, 2024. REUTERS/Nathan Howard/File Photo

(Reuters) - U.S. truck engine maker Cummins Inc (NYSE:CMI) on Tuesday reported fourth-quarter revenue and profit above Wall Street estimates on strong demand for its power generation products, sending the company's shares up 3.5% before the bell.

The artificial intelligence race among big tech giants has led to a surge in power demand from data centers that run AI language models, boosting sales for power solutions providers.

The rise in energy demands led to a double digit sales growth for Cummins' Distribution and Power Systems segments, which engage in sale and maintenance of power generators.

However, the company expects annual sales to decline as the recovery in the North American heavy-duty truck market remains sluggish.

The machinery industry is currently facing an oversupply of equipment and reduced demand, but analysts believe the trucking sector will be the first to stabilize.

"In 2025, we anticipate that demand will be slightly weaker in the North America on-highway truck markets, particularly in the first half of the year, but offset by strength in other key markets," Cummins CEO Jennifer Rumsey said in a statement.

The Indiana-based company forecast its 2025 revenue to be within a range of down 2% and up 3%. Analysts were expecting a 1.72% growth, according to data compiled by LSEG.

For the quarter ended Dec. 31, Cummins reported net income of $418 million, or $3.02 per share, which included $312 million in charges from the reorganization of its new power unit, Accelera.

© Reuters. FILE PHOTO: Signage for Cummins is seen during the Association of the United States Army annual meeting and exposition at the Walter E. Washington Convention Center in Washington, U.S., October 14, 2024. REUTERS/Nathan Howard/File Photo

Excluding these charges, the engine maker earned $5.14 per share, surpassing analyst's estimates of $4.68 per share.

Net sales came in at $8.45 billion, compared to estimates of $8.07 billion.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2025 - Fusion Media Limited. All Rights Reserved.