W.031Cummins’ power generation sales rose 22% on data center demand. Fewer pickup engines lowered its forecast for the year
Cummins’ Power Systems segment sold $1.56B of power generation equipment in the quarter to September, up 21.6% on a year earlier and 83% above the first quarter of 2024, which the company attributed particularly to data center demand. The segment’s EBITDA margin rose 2.5 points to 25.4%. Cummins still cut its 2026 revenue growth forecast to about 10%, the bottom of its earlier 10% to 13% range, because it expects to ship fewer pickup truck engines. Management said large generator orders now run into the second half of 2028.
Generators carried the segment
Power generation is now two-thirds of Power Systems. The segment’s sales rose 15% to $2.29B in the third quarter; power generation, the gensets that back up and in some cases power data centers, rose 21.6% to $1,557 million, 68.0% of the segment against 64.1% a year earlier. Industrial engine sales fell. Since the first quarter of 2024, power generation sales have risen 83% and industrial sales 23%. Cummins said growth came mainly from power generation demand, particularly from data centers in the US, China and Asia Pacific; on the call management put North American power generation revenue up 22% and said large generator orders now extend into the second half of 2028. In May, Cummins estimated its data center revenue at about $5 billion for 2026, up from about $3.5 billion in 2025, and set a target of $9 billion by 2030.
Margins rose with volume. Power Systems EBITDA was $582 million, 25.4% of sales, up from 22.9% a year earlier and 17.1% in the first quarter of 2024. Cummins narrowed the segment’s 2026 guidance to 15% to 18% revenue growth and a 25.1% to 25.6% margin, from 14% to 19% and 25% to 25.75%, leaving the midpoints about unchanged. Management said a supplier problem in Power Systems held back large engines, pushing about $200 million of revenue, mainly in its Distribution business, from the third quarter into the fourth, and said it was not a demand issue.
Power generation is up 83% since early 2024
Cummins Power Systems segment sales by quarter, $ millions, by product line; the latest quarter’s power generation is highlighted. Totals over bars in $ billions. Segment sales include sales to other Cummins segments. Q2 2024 is also derivable from nine-month figures.
Data
| Quarter | Power generation | Industrial | Generator tech. | Total | EBITDA | Margin |
|---|---|---|---|---|---|---|
| Q1 2024 | 853 | 420 | 116 | 1,389 | 237 | 17.1% |
| Q2 2024 | 987 | 478 | 124 | 1,589 | 301 | 18.9% |
| Q3 2024 | 1,055 | 508 | 124 | 1,687 | 328 | 19.4% |
| Q4 2024 | 1,090 | 526 | 127 | 1,743 | 314 | 18.0% |
| Q1 2025 | 1,001 | 498 | 150 | 1,649 | 389 | 23.6% |
| Q2 2025 | 1,205 | 506 | 178 | 1,889 | 430 | 22.8% |
| Q3 2025 | 1,280 | 531 | 185 | 1,996 | 457 | 22.9% |
| Q4 2025 | 1,245 | 528 | 156 | 1,929 | 418 | 21.7% |
| Q1 2026 | 1,283 | 506 | 167 | 1,956 | 577 | 29.5% |
| Q2 2026 | 1,536 | 538 | 181 | 2,255 | 552 | 24.5% |
| Q3 2026 | 1,557 | 518 | 214 | 2,289 | 582 | 25.4% |
The segment’s margin, by quarter
Cummins Power Systems EBITDA as a share of segment sales, %, by quarter (our calculation from reported EBITDA and segment sales; the company reports the same ratios rounded).
Why the forecast fell anyway
The cut came from pickups, not from heavy trucks or generators. Cummins now expects revenue growth of about 10% in 2026, against 10% to 13% in August, and an EBITDA margin of about 18.2%. Chief financial officer Mark Smith called lower North American pickup volumes the primary reason; Cummins cut its forecast for pickup engine shipments to 118,000 to 122,000 from 125,000 to 140,000. The truck businesses were not shrinking in the quarter: Engine segment sales rose 20% and its EBITDA 62%. As a result, Power Systems’ share of segment EBITDA was about the same as a year earlier, 32.0% against 32.5% excluding last year’s charges at Accelera, its electrification unit. Revenue was $9.44 billion, up 13.5%. The shares were at $448.19 on November 6 against $472.01 just before the results, down 5.0%, StockStory reported.
Engines grew profits fastest this quarter
Change in each Cummins segment’s EBITDA, third quarter 2026 on a year earlier, % (our calculation), with the segment’s sales growth under its name and its EBITDA in the label. Accelera, which lost $56 million against $96 million a year earlier excluding charges, is left out.
Raised twice, then cut
Cummins guidance for 2026 revenue growth, %, by the date it was issued: solid to the low end, outlined to the high end. The November figure is a single “about 10%”.
What this changes on 06.ai
- Series lead: Cummins’ Power Systems power generation sales, reported quarterly, are a clean public series for spending on data center backup and on-site generation; Caterpillar and Generac report similar lines.
- Watch: whether Cummins gives a generator backlog figure; it gave none this quarter beyond orders running into the second half of 2028, and its 2027 guidance comes in February.
Sources and method
| Item | Figure | Source |
|---|---|---|
| Q3 2026 | Net sales $9,438M (Q3 2025 $8,317M); EBITDA $1,786M, 18.9%; segment sales and EBITDA as charted; Power Systems power generation $1,557M, industrial $518M, generator technologies $214M; Accelera EBITDA loss $56M; 2026 revenue growth about 10%, EBITDA margin about 18.2%; growth “driven primarily by increased power generation demand, particularly for data center markets” | Cummins Q3 release, Nov 5 (8-K) |
| Q3 2026 | Remaining performance obligations $8.1B at Sep 30, 2026, $4.8B in the next 12 months | Cummins Q3 2026 10-Q |
| Q2 2026 | Power Systems quarter; 2026 guidance 10%–13% | Cummins Q2 release, Aug 4 (8-K) |
| Q2 call | Power Systems 2026 guidance maintained at 14%–19% revenue growth and a 25%–25.75% EBITDA margin | MarketBeat call highlights, Aug 4 |
| Q1 2026 | Power Systems sales $1,956M, EBITDA $577M (29.5%); Q1 2025 $1,649M, $389M; guidance 8%–11% | Cummins Q1 release, May |
| Q4 2025 | Power Systems quarter; 2026 guidance 3%–8% | Cummins Q4 release, Feb 5 (8-K) |
| 2024 | Q3 2024 quarter and nine-month Power Systems figures (Q2 2024 derived) | Cummins Q3 2024 release (8-K) |
| 2024 | Q1 2024 Power Systems quarter | Cummins Q1 2024 release |
| 2024 | Q4 2024 Power Systems quarter | Cummins Q4 2024 release |
| Call | Power Systems 2026 guidance 15%–18% revenue growth, 25.1%–25.6% EBITDA margin; pickup engine shipments 118k–122k (from 125k–140k); large genset orders into the second half of 2028; North America power generation revenue +22%; a Power Systems supplier problem pushed about $200M of revenue, mainly Distribution, from Q3 into Q4 | Q3 call transcript (gloom.sh) |
| Call | Call recap | Yahoo Finance |
| Analyst Day | Data center revenue, including Distribution, about $5B at the 2026 guidance midpoint, from about $3.5B in 2025; $9B by 2030; high-horsepower capacity 35 GW at end-2025, 55 GW by 2030 | Analyst Day transcript, May 21 |
| Shares | $448.19 on Nov 6 against $472.01 just before the results | StockStory, Nov 6 |
Growth: power generation 1,557 ÷ 1,280 − 1 = 21.6%; ÷ 853 − 1 = 82.5%; industrial 518 ÷ 420 − 1 = 23.3%. Segment sales are the sum of the three lines: 2,289 and 1,996. Share: 1,557 ÷ 2,289 = 68.0%; 1,280 ÷ 1,996 = 64.1%. Q2 2024 = nine months to September 2024 less Q1 and Q3.
Margins: EBITDA ÷ segment sales each quarter, e.g. 582 ÷ 2,289 = 25.4%. Segment EBITDA: Engine 422 ÷ 261 − 1 = 61.7%; Components 408 ÷ 292 − 1 = 39.7%; Distribution 461 ÷ 492 − 1 = -6.3%; Power Systems 582 ÷ 457 − 1 = 27.4%. Power Systems share: 582 ÷ 1,817 (five segments including Accelera’s −56) = 32.0%; a year earlier 457 ÷ 1,406 (Accelera at −96, excluding charges) = 32.5%. Shares: 448.19 ÷ 472.01 − 1 = -5.0%.
Wire reports are written within hours of the news, on a six-hour schedule. Each lists its sources and shows the arithmetic behind its figures. Not investment advice.