The raised full-year guidance is the key catalyst — it signals management's confidence in a cyclical recovery in North America truck markets and sustained data center demand. The Q1 EPS miss is largely noise from a one-time charge. Watch for follow-through on the truck market recovery in Q2 and Q3, and monitor Power Systems segment momentum as a leading indicator. The stock may gap up on the guidance raise.
Price Chart
Executive Summary
Cummins reported Q1 2026 GAAP diluted EPS of $4.71, well below the $5.96 in Q1 2025, and missed the $5.55 consensus by ~15%. Revenue of $8.4B grew 3% YoY and was roughly in line with the $8.37B estimate. The headline miss was driven by a $199M charge ($1.44/share) from the sale of the low-pressure fuel cell business. However, the company raised its full-year 2026 revenue guidance to +8-11% (from +3-8%) and EBITDA margin guidance to 17.75-18.50% (from 17.0-18.0%), signaling improving end-market demand, particularly in data center power generation and North America truck markets. The stock will likely move on the raised guidance and strong Power Systems segment performance, which offset the one-time charge.
Key Financial Metrics
Key Facts
- Q1 2026 GAAP diluted EPS of $4.71 vs $5.96 YoY, a 21% decline; includes $1.44/share charge from fuel cell business sale
- Q1 2026 revenue of $8.4B, up 3% YoY from $8.17B, roughly in line with consensus of $8.37B
- Full-year 2026 revenue guidance raised to +8-11% from prior +3-8%; EBITDA margin guidance raised to 17.75-18.50% from 17.0-18.0%
- Power Systems segment revenue surged 19% YoY to $2.0B, with EBITDA margin expanding to 29.5% from 23.6%, driven by data center demand
- Distribution segment revenue up 7% YoY to $3.1B, EBITDA margin improved to 14.2% from 12.9%
- Engine and Components segments saw revenue declines of 4% and 5% respectively, reflecting continued weakness in North America truck markets
- Operating cash flow was $309M in Q1 vs -$3M in Q1 2025; company returned $519M to shareholders via dividends and buybacks
- The $199M charge for the fuel cell business sale is a one-time item; excluding it, adjusted EBITDA margin was 17.7%, nearly flat vs 17.9% a year ago
Financial Impact
GAAP EPS miss of ~15% vs consensus ($4.71 vs $5.55) due to $199M charge; revenue roughly in line. Raised full-year guidance implies ~$1.5-2B incremental revenue vs prior outlook.
Risk Factors
- North America truck market recovery may be slower than anticipated, weighing on Engine and Components segments
- Tariff and trade policy changes could disrupt supply chains and increase costs
- Accelera segment continues to generate significant EBITDA losses ($277M in Q1), though losses are being reduced
- One-time charges from fuel cell exit may signal further restructuring costs in the zero-emissions portfolio
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 6 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 8-K Filing (Primary) | 0000026172-26-000013 |
| Document: cmi-20260505.htm | 0000026172-26-000013 |
| Document: 0000026172-26-000013-index-headers.html | 0000026172-26-000013 |
| Document: 0000026172-26-000013-index.html | 0000026172-26-000013 |
| Document: 0000026172-26-000013.txt | 0000026172-26-000013 |
| 8-K Data (Synthetic) | 0000026172-26-000013 |
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Aug 4, 2026 8w ago | 8-K | $635.96 $551.15 | ▼ −13.34% | ▼ −12.10% | $526.30 (−17.24%) |
May 14, 2026 20w ago | Insider Cluster | $715.24 $659.58 | ▼ −7.78% | ▼ −6.92% | $526.30 (−26.42%) |
May 8, 2026 21w ago | Insider Cluster | $679.55 $651.22 | ▼ −4.17% | ▼ −4.19% | $526.30 (−22.55%) |
May 8, 2026 21w ago | Insider Cluster | $679.55 $651.22 | ▼ −4.17% | ▼ −4.19% | $526.30 (−22.55%) |
May 8, 2026 21w ago | Insider Cluster | $677.23 $651.22 | ▼ −3.84% | ▼ −3.86% | $526.30 (−22.29%) |
May 8, 2026 21w ago | Insider Cluster | $707.96 $655.69 | ▼ −7.38% | ▼ −6.77% | $526.30 (−25.66%) |
May 8, 2026 21w ago | Insider Cluster | $677.23 $651.22 | ▼ −3.84% | ▼ −3.86% | $526.30 (−22.29%) |
May 8, 2026 21w ago | Insider Cluster | $677.23 $651.22 | ▼ −3.84% | ▼ −3.86% | $526.30 (−22.29%) |
May 8, 2026 21w ago | Insider Cluster | $677.23 $651.22 | ▼ −3.84% | ▼ −3.86% | $526.30 (−22.29%) |
May 8, 2026 21w ago | Insider Cluster | $677.23 $651.22 | ▼ −3.84% | ▼ −3.86% | $526.30 (−22.29%) |
US Market Status
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