Cummins raises outlook on record data center power demand

Cummins (NYSE:CMI) raised its full-year financial targets after record demand for data center power systems drove a strong first-quarter performance, allowing the engine maker to outpace its own growth expectations for the year.

The Columbus, Indiana-based company now projects full-year 2026 revenue to grow between 8% and 11%, a sharp increase from its previous guidance of 3% to 8%.

Cummins also lifted its EBITDA margin forecast to a range of 17.75% to 18.50%, up from the 17.0% to 18.0% range estimated earlier this year.

For the first quarter, Cummins reported net sales of $8.4 billion, a 3% increase over the prior year.

While North American sales dipped 6% due to a cyclical low in the truck market, international revenue surged 16%, led by a recovery in China.

Net income for the quarter was $654 million, or $4.71 per diluted share, compared to $824 million a year earlier.

The bottom line was impacted by $199 million in one-time charges, or $1.44 per share, related to the completion of the sale of its low-pressure fuel cell business to Alstom.

Management noted the exit reflects a strategic pivot within its Accelera zero-emissions segment to focus on higher-adoption hydrogen technologies and reduce losses.

Despite the charges, the company’s underlying operational strength was evident in its adjusted figures.

EBITDA for the quarter stood at 15.4% of sales, though it would have been significantly higher excluding the $199 million divestiture-related hit.