Name: Cummins Inc. (NYSE:CMI) | Income Statement
Creator: Stock Analysis on Net

Income Statement

The income statement presents information on the financial results of a company business activities over a period of time. The income statement communicates how much revenue the company generated during a period and what cost it incurred in connection with generating that revenue.

Download chart

Cummins Inc., consolidated income statement

US$ in millions

12 months ended:	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Net sales	34,065)	28,074)	24,021)	19,811)	23,571)
Cost of sales	(25,816)	(21,355)	(18,326)	(14,917)	(17,591)
Gross margin	8,249)	6,719)	5,695)	4,894)	5,980)
Selling, general and administrative expenses	(3,333)	(2,687)	(2,374)	(2,125)	(2,454)
Research, development and engineering expenses	(1,500)	(1,278)	(1,090)	(906)	(1,001)
Equity, royalty and interest income from investees	483)	349)	506)	452)	330)
Restructuring actions	—)	—)	—)	—)	(119)
Other operating expense, net	(2,138)	(174)	(31)	(46)	(36)
Operating income and expenses	(6,488)	(3,790)	(2,989)	(2,625)	(3,280)
Operating income	1,761)	2,929)	2,706)	2,269)	2,700)
Interest expense	(375)	(199)	(111)	(100)	(109)
Other income, net	240)	89)	156)	169)	243)
Income before income taxes	1,626)	2,819)	2,751)	2,338)	2,834)
Income tax expense	(786)	(636)	(587)	(527)	(566)
Consolidated net income	840)	2,183)	2,164)	1,811)	2,268)
Net income attributable to noncontrolling interests	(105)	(32)	(33)	(22)	(8)
Net income attributable to Cummins Inc.	735)	2,151)	2,131)	1,789)	2,260)

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Financial performance over the five-year period is characterized by a strong upward trajectory in top-line revenue contrasted by a significant contraction in bottom-line profitability in the final year. While net sales recovered from a 2020 dip to reach a peak in 2023, the conversion of these sales into net income has deteriorated sharply.

Revenue and Gross Profit Trends: Net sales exhibited a volatile but generally positive trend, decreasing from US$ 23,571 million in 2019 to US$ 19,811 million in 2020, before growing consecutively to reach US$ 34,065 million by 2023. Gross margin followed a similar pattern, expanding from US$ 5,980 million in 2019 to US$ 8,249 million in 2023. Although absolute gross profit increased, the gross margin as a percentage of net sales remained relatively stable, fluctuating between approximately 23.7% and 25.4% over the period.
Operating Expense Analysis: Operating costs have increased in tandem with revenue growth. Selling, general, and administrative expenses rose from US$ 2,454 million in 2019 to US$ 3,333 million in 2023. Similarly, investment in research, development, and engineering showed a steady upward trend, increasing from US$ 1,001 million to US$ 1,500 million. A critical divergence occurred in 2023, where "Other operating expense, net" spiked to US$ 2,138 million, a substantial increase from the US$ 174 million recorded in 2022, severely impacting operating results.
Operating and Net Income Performance: Operating income remained relatively stable between 2019 and 2022, ranging from US$ 2,269 million to US$ 2,929 million. However, in 2023, operating income dropped to US$ 1,761 million despite record-high sales. This downward pressure extended to the bottom line, with consolidated net income falling from a peak of US$ 2,183 million in 2022 to US$ 840 million in 2023. Net income attributable to Cummins Inc. experienced a corresponding decline, ending 2023 at US$ 735 million.
Financial Costs and Taxation: Interest expenses have escalated significantly, rising from US$ 109 million in 2019 to US$ 375 million in 2023, suggesting an increase in the cost of debt or higher leverage. Income tax expenses also trended upward, reaching US$ 786 million in 2023, despite the lower pre-tax income for that year, which further contributed to the compression of net income.

AI Ask an analyst for more

My previous chats

Add tokens

Hi, I’m an AI-powered financial analyst at Stock Analysis on Net.
Without a user account, I tend to respond rather slowly.

How can I help you?