Cummins Q2 Profit Jumps on Power-Hungry Data Centers
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Profit at Cummins jumped in the second quarter of 2025 even as heavy- and medium-duty engine sales tumbled and company executives predicted a rougher third quarter for truck demand.
Cummins reported net income of $890 million in the most recent quarter, or $6.43 per diluted share, a 22.6% increase compared with $726 million, $5.26, in the year-ago period, benefiting from data centers’ hunger for electricity.
The engine, component and power generator manufacturer posted Q2 revenue of $8.64 billion, a decrease of 2% from $8.8 billion in the same quarter in 2024, but beat analyst expectations of $8.47 billion by 1.99%, according to Zacks Equity Research.
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Sales by Cummins’ power systems division soared 19% year over year in the most recent three-month period to $1.9 billion from $1.59 billion.
Demand for power generators from data centers was particularly frothy, particularly in North America, where demand rose 23% year over year.
Revenue at the company’s distribution unit, meanwhile, rose 7% compared with Q2 2024 to $3.04 billion from $2.83 billion behind similar stimuli.
Heavy-Duty Engine Sales Plummet
But sales at Cummins’ engine division fell 8% year on year to $2.9 billion from $3.15 billion, with lower on-highway truck demand in the United States and Mexico a key factor.
Columbus, Ind.-based Cummins’ revenue from heavy-duty truck engine sales totaled $976 million in Q2, a decrease of 17.6% from $1.18 billion.
The company’s revenue from medium-duty truck and bus engine sales declined 7.4% to $950 million from $1.07 billion.
Cummins’ heavy-duty truck engine sales totaled 29,600 in Q2, a decrease of 21.1% compared with 37,500. Medium-duty truck and bus engine sales fell 7.8% to 73,400 from 79,600.
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North American production of heavy-duty trucks in Q2 totaled 57,000 units, down 27% from 2024 levels, while Cummins’ heavy-duty engine sales in the region decreased 29% to 22,000, CEO Jennifer Rumsey said during the company’s quarterly earnings call with analysts Aug. 5.
Rumsey said multiple reasons were behind the decrease. “There’s a number of typical factors and then some atypical factors that we see influencing the truck cycle. So spot rates continue to be low. Economic demand isn’t really growing for customers. Interest rates are still higher,” she told analysts.
“And while the age of the fleet on average has gone up some, we still are seeing that kind of cyclical — normal cyclical — [downtrend] in the truck market, which then had on top of it this uncertainty around tariff policy [and] the impact that’s going to have on price of trucks, [plus] regulatory uncertainty, which means customers are really just holding. Waiting to see what happens [and] get more stability and clarity on orders,” she added.
When that stability and clarity will emerge is difficult to predict, said the company’s top executive, adding that was why Cummins was not offering any full-year guidance.
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Chief Financial Officer Mark Smith said the over-the-road freight market and consequently Class 8 truck demand in the past three or four months matched the weakest levels of the past 20 years.
Executives Say Q3 to Be Much Worse
Rumsey said Cummins expects an even more dismal Q3. “As we look ahead to the third quarter, we expect North America heavy- and medium-duty truck volume to decline 25% to 30% from second-quarter levels,” Rumsey said. “As we have seen, truck orders recently reached multiyear lows, and [truck makers] have initiated reduced workweeks through the next three months.”
“The duration of this reduced demand [for] North America truck markets will largely depend on the trajectory of the broader economy, the evolution of trade and tariff policies, and the pace at which regulatory clarity emerges,” she added.
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President Donald Trump threatened and then introduced multiple tariffs over the past several months, with the delays hampering investment decisions and supply chains.
“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,” said Rumsey.
“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 the 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,” added Smith.
Cummins’ earnings will be somewhat insulated, however, due to expectations that power generation infrastructure spending will continue apace, Rumsey said, a picture similar to that painted by the company’s industrial manufacturing peers, such as Eaton.
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