Mon, May 5, 6:44 PM (7 days ago)
**Cummins Inc. (CMI) Q1 2025 Financial Summary** **Financial Health & Performance:** - **Revenue:** $8.2 billion, down 3% YoY due to divestiture of Atmus and weaker demand in on-highway truck markets. - **Net Income:** $824 million, down 59% YoY, primarily due to the absence of the $1.3 billion gain from the Atmus divestiture. - **Gross Margin:** 26.4%, up 2.1 points YoY, driven by favorable pricing and lower material costs. - **Operating Income:** $1.1 billion, up 23% YoY, due to improved gross margin and lower operating expenses. - **Earnings per Share (EPS):** $5.96, down 58% YoY. **Profit Margins:** - **Gross Margin:** 26.4% (up from 24.3% in Q1 2024). - **Operating Margin:** 13.9% (up from 11.0% in Q1 2024). **Cash Flow:** - **Operating Cash Flow:** $(3) million, a decrease of $279 million YoY due to higher working capital requirements. - **Investing Cash Flow:** $(246) million, an improvement of $160 million YoY due to the absence of cash associated with the Atmus divestiture. - **Financing Cash Flow:** $92 million, a decrease of $407 million YoY due to lower proceeds from borrowings. **Earnings Changes:** - **Net Income:** Decreased by $1.2 billion YoY, primarily due to the absence of the Atmus divestiture gain. - **EPS:** Decreased by $8.07 YoY. **Quarterly Performance Discussion:** - **Revenue Decline:** Driven by the divestiture of Atmus and weaker demand in on-highway truck markets. - **Margin Improvement:** Gross margin improved due to favorable pricing and lower material costs. - **Operating Income Growth:** Driven by improved gross margin and lower operating expenses. **Trends & Uncertainties:** - **Tariff Impact:** Escalating tariffs may adversely affect future results. - **Market Demand:** Uncertainty due to global tariffs and economic conditions. - **Pension Contributions:** Anticipated additional contributions of $39 million for U.S. and U.K. pension plans. **Future Operations Impact:** - **Capital Expenditures:** Planned spend of $1.4 billion to $1.5 billion in 2025, with over 65% in North America. - **Debt Maturity:** $500 million of senior notes due in 2025. - **Liquidity:** Strong balance sheet and credit ratings support liquidity needs.