10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549 

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended March 31, 2024

Commission File Number 1-4949

CUMMINS INC.

(Exact name of registrant as specified in its charter)

Indiana	35-0257090
(State of Incorporation)	(IRS Employer Identification No.)

500 Jackson Street

Box 3005

Columbus, Indiana 47202-3005

(Address of principal executive offices)

Telephone (812) 377-5000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common stock, $2.50 par value	CMI	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that registrant was required to submit such files). Yes x No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check one):

Large Accelerated Filer	x	Accelerated filer	☐	Non-accelerated filer	☐
Smaller reporting company	☐	Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐  No x

As of March 31, 2024, there were 136,779,875 shares of common stock outstanding with a par value of $2.50 per share.

1

CUMMINS INC. AND SUBSIDIARIES

TABLE OF CONTENTS

QUARTERLY REPORT ON FORM 10-Q

 

		Page
	PART I. FINANCIAL INFORMATION
ITEM 1.	Condensed Consolidated Financial Statements (Unaudited)	3
	Condensed Consolidated Statements of Net Income for the three months ended March 31, 2024 and 2023	3
	Condensed Consolidated Statements of Comprehensive Income for the three months ended March 31, 2024 and 2023	4
	Condensed Consolidated Balance Sheets at March 31, 2024 and December 31, 2023	5
	Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2024 and 2023	6
	Condensed Consolidated Statements of Changes in Redeemable Noncontrolling Interests and Equity for the three months ended March 31, 2024 and 2023	7
	Notes to Condensed Consolidated Financial Statements	8
ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26
ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk	44
ITEM 4.	Controls and Procedures	45
	PART II. OTHER INFORMATION
ITEM 1.	Legal Proceedings	45
ITEM 1A.	Risk Factors	45
ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	46
ITEM 3.	Defaults Upon Senior Securities	46
ITEM 4.	Mine Safety Disclosures	46
ITEM 5.	Other Information	46
ITEM 6.	Exhibits	47
	Signatures	48

2

PART I.  FINANCIAL INFORMATION 

ITEM 1.  Condensed Consolidated Financial Statements 

CUMMINS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF NET INCOME

(Unaudited)

	Three months ended
	March 31,
In millions, except per share amounts	2024		2023
NET SALES (Notes 1 and 2)	$	8,403	$	8,453
Cost of sales	6,362		6,424
GROSS MARGIN	2,041		2,029
OPERATING EXPENSES AND INCOME
Selling, general and administrative expenses	839		753
Research, development and engineering expenses	369		350
Equity, royalty and interest income from investees (Note 4)	123		119
Other operating expense, net	33		19
OPERATING INCOME	923		1,026
Interest expense	89		87
Other income, net (Note 14)	1,387		90
INCOME BEFORE INCOME TAXES	2,221		1,029
Income tax expense (Note 5)	193		223
CONSOLIDATED NET INCOME	2,028		806
Less: Net income attributable to noncontrolling interests	35		16
NET INCOME ATTRIBUTABLE TO CUMMINS INC.	$	1,993	$	790
EARNINGS PER COMMON SHARE ATTRIBUTABLE TO CUMMINS INC.
Basic	$	14.10	$	5.58
Diluted	$	14.03	$	5.55
WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING
Basic	141.3		141.5
Dilutive effect of stock compensation awards	0.8		0.9
Diluted	142.1		142.4

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

3

CUMMINS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

 

	Three months ended
	March 31,
In millions	2024		2023
CONSOLIDATED NET INCOME	$	2,028	$	806
Other comprehensive (loss) income, net of tax (Note 12)
Change in pension and other postretirement defined benefit plans	(13)		(9)
Foreign currency translation adjustments	(60)		82
Unrealized gain (loss) on derivatives	12		(3)
Total other comprehensive (loss) income, net of tax	(61)		70
COMPREHENSIVE INCOME	1,967		876
Less: Comprehensive income attributable to noncontrolling interests	32		19
COMPREHENSIVE INCOME ATTRIBUTABLE TO CUMMINS INC.	$	1,935	$	857

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

4

CUMMINS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

In millions, except par value	March 31, 2024		December 31, 2023
ASSETS
Current assets
Cash and cash equivalents	$	2,541	$	2,179
Marketable securities (Note 6)	510		562
Total cash, cash equivalents and marketable securities	3,051		2,741
Accounts and notes receivable, net	5,463		5,583
Inventories (Note 7)	5,758		5,677
Prepaid expenses and other current assets	1,348		1,197
Total current assets	15,620		15,198
Long-term assets
Property, plant and equipment	11,253		11,674
Accumulated depreciation	(5,242)		(5,425)
Property, plant and equipment, net	6,011		6,249
Investments and advances related to equity method investees	1,774		1,800
Goodwill	2,406		2,499
Other intangible assets, net	2,455		2,519
Pension assets (Note 3)	1,187		1,197
Other assets (Note 8)	2,374		2,543
Total assets	$	31,827	$	32,005
LIABILITIES
Current liabilities
Accounts payable (principally trade)	$	4,476	$	4,260
Loans payable (Note 9)	342		280
Commercial paper (Note 9)	609		1,496
Current maturities of long-term debt (Note 9)	113		118
Accrued compensation, benefits and retirement costs	561		1,108
Current portion of accrued product warranty (Note 10)	652		667
Current portion of deferred revenue (Note 2)	1,236		1,220
Other accrued expenses (Note 8)	3,697		3,754
Total current liabilities	11,686		12,903
Long-term liabilities
Long-term debt (Note 9)	5,771		4,802
Deferred revenue (Note 2)	1,061		966
Other liabilities (Note 8)	3,208		3,430
Total liabilities	$	21,726	$	22,101
Commitments and contingencies (Note 11)
EQUITY
Cummins Inc. shareholders’ equity
Common stock, $2.50 par value, 500 shares authorized, 222.5 and 222.5 shares issued	$	2,557	$	2,564
Retained earnings	19,605		17,851
Treasury stock, at cost, 85.7 and 80.7 shares	(10,831)		(9,359)
Accumulated other comprehensive loss (Note 12)	(2,264)		(2,206)
Total Cummins Inc. shareholders’ equity	9,067		8,850
Noncontrolling interests	1,034		1,054
Total equity	$	10,101	$	9,904
Total liabilities and equity	$	31,827	$	32,005

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

5

CUMMINS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Three months ended
	March 31,
In millions	2024		2023
CASH FLOWS FROM OPERATING ACTIVITIES
Consolidated net income	$	2,028	$	806
Adjustments to reconcile consolidated net income to net cash provided by operating activities
Gain related to divestiture of Atmus (Note 14)	(1,333)		—
Depreciation and amortization	265		246
Deferred income taxes	(38)		(38)
Equity in income of investees, net of dividends	(78)		(67)
Pension and OPEB expense (Note 3)	9		1
Pension contributions and OPEB payments (Note 3)	(48)		(92)
Changes in current assets and liabilities, net of acquisitions and divestitures
Accounts and notes receivable	(11)		(621)
Inventories	(354)		(263)
Other current assets	(175)		(142)
Accounts payable	327		381
Accrued expenses	(393)		151
Other, net	77		133
Net cash provided by operating activities	276		495
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures	(169)		(193)
Acquisition of business, net of cash acquired	(59)		—
Investments in marketable securities—acquisitions	(379)		(326)
Investments in marketable securities—liquidations (Note 6)	431		345
Cash associated with Atmus divestiture	(174)		—
Other, net	(56)		(54)
Net cash used in investing activities	(406)		(228)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from borrowings	2,398		43
Net payments of commercial paper	(887)		(29)
Payments on borrowings and finance lease obligations	(748)		(142)
Dividend payments on common stock	(239)		(222)
Other, net	(25)		(13)
Net cash provided by (used in) financing activities	499		(363)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS	(7)		(25)
Net increase (decrease) in cash and cash equivalents	362		(121)
Cash and cash equivalents at beginning of year	2,179		2,101
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	2,541	$	1,980

 The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

6

CUMMINS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY

(Unaudited)

 

	Three months ended
In millions, except per share amounts	Redeemable Noncontrolling Interests		Common Stock		Additional Paid-in Capital		Retained Earnings		Treasury Stock		Accumulated Other Comprehensive Loss		Total Cummins Inc. Shareholders’ Equity		Noncontrolling Interests		Total Equity
BALANCE AT DECEMBER 31, 2023	$	—	$	556	$	2,008	$	17,851	$	(9,359)	$	(2,206)	$	8,850	$	1,054	$	9,904
Net income							1,993						1,993		35		2,028
Other comprehensive loss, net of tax (Note 12)											(119)		(119)		(3)		(122)
Cash dividends on common stock, $1.68 per share							(239)						(239)		—		(239)
Distributions to noncontrolling interests													—		(33)		(33)
Share-based awards					(6)				60				54		—		54
Divestiture of Atmus (Note 14)									(1,532)		61		(1,471)		(19)		(1,490)
Other shareholder transactions					(1)								(1)		—		(1)
BALANCE AT MARCH 31, 2024	$	—	$	556	$	2,001	$	19,605	$	(10,831)	$	(2,264)	$	9,067	$	1,034	$	10,101
BALANCE AT DECEMBER 31, 2022	$	258	$	556	$	1,687	$	18,037	$	(9,415)	$	(1,890)	$	8,975	$	992	$	9,967
Net income	(8)						790						790		24		814
Other comprehensive income, net of tax (Note 12)											67		67		3		70
Cash dividends on common stock, $1.57 per share							(222)						(222)		—		(222)
Distributions to noncontrolling interests													—		(22)		(22)
Share-based awards					(5)				25				20		—		20
Fair value adjustment of redeemable noncontrolling interests	11				(11)								(11)		—		(11)
Other shareholder transactions					3				1				4		—		4
BALANCE AT MARCH 31, 2023	$	261	$	556	$	1,674	$	18,605	$	(9,389)	$	(1,823)	$	9,623	$	997	$	10,620

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.

7

CUMMINS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1. NATURE OF OPERATIONS AND BASIS OF PRESENTATION

Overview

Cummins Inc. (“Cummins,” “we,” “our” or “us”) was founded in 1919 as Cummins Engine Company, a corporation in Columbus, Indiana, and one of the first diesel engine manufacturers. In 2001, we changed our name to Cummins Inc. We are a global power solutions leader comprised of five business segments - Components, Engine, Distribution, Power Systems and Accelera - supported by our global manufacturing and extensive service and support network, skilled workforce and vast technical expertise. Our products range from advanced diesel, natural gas, electric and hybrid powertrains and powertrain-related components including aftertreatment, turbochargers, fuel systems, valvetrain technologies, controls systems, air handling systems, automated transmissions, axles, drivelines, brakes, suspension systems, electric power generation systems, batteries, electrified power systems, hydrogen production technologies and fuel cell products. We sell our products to original equipment manufacturers (OEMs), distributors, dealers and other customers worldwide. We serve our customers through a service network of approximately 450 wholly-owned, joint venture and independent distributor locations and more than 19,000 Cummins certified dealer locations in approximately 190 countries and territories.

Divestiture of Atmus

On March 18, 2024, we completed the divestiture of our remaining 80.5 percent ownership of Atmus Filtration Technologies Inc. (Atmus) common stock through a tax-free split-off. See NOTE 14, "ATMUS DIVESTITURE," for additional information.

Settlement Agreements

In December 2023, we announced that we reached an agreement in principle with the U.S. Environmental Protection Agency (EPA), the California Air Resources Board (CARB), the Environmental and Natural Resources Division of the U.S. Department of Justice and the California Attorney General's Office to resolve certain regulatory civil claims regarding our emissions certification and compliance process for certain engines primarily used in pick-up truck applications in the U.S., which became final and effective in April 2024 (collectively, the Settlement Agreements). See NOTE 11, “COMMITMENTS AND CONTINGENCIES,” for additional information.

Interim Condensed Financial Statements

The unaudited Condensed Consolidated Financial Statements reflect all adjustments which, in the opinion of management, are necessary for a fair statement of the results of operations, financial position and cash flows. All such adjustments are of a normal recurring nature. The Condensed Consolidated Financial Statements were prepared in accordance with accounting principles in the United States of America (GAAP) pursuant to the rules and regulations of the Securities and Exchange Commission (SEC) for interim financial information. Certain information and footnote disclosures normally included in annual financial statements were condensed or omitted as permitted by such rules and regulations.

These interim condensed consolidated financial statements should be read in conjunction with the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2023. Our interim period financial results for the three month periods presented are not necessarily indicative of results to be expected for any other interim period or for the entire year. The year-end Condensed Consolidated Balance Sheet data was derived from audited financial statements but does not include all required annual disclosures.

Reclassifications

Certain amounts for prior year periods were reclassified to conform to the current year presentation.

Use of Estimates in Preparation of Financial Statements

Preparation of financial statements requires management to make estimates and assumptions that affect reported amounts presented and disclosed in our Condensed Consolidated Financial Statements. Significant estimates and assumptions in these Condensed Consolidated Financial Statements require the exercise of judgment. Due to the inherent uncertainty involved in making estimates, actual results reported in future periods may be different from these estimates.

8

Weighted-Average Diluted Shares Outstanding

The weighted-average diluted common shares outstanding exclude the anti-dilutive effect of certain stock options. The options excluded from diluted earnings per share were as follows:

 

	Three months ended
	March 31,
	2024	2023
Options excluded	3,600	4,833

Related Party Transactions

In accordance with the provisions of various joint venture agreements, we may purchase products and components from our joint ventures, sell products and components to our joint ventures and our joint ventures may sell products and components to unrelated parties.

The following is a summary of sales to and purchases from nonconsolidated equity investees:

	Three months ended
	March 31,
In millions	2024		2023
Sales to nonconsolidated equity investees	$	351	$	376
Purchases from nonconsolidated equity investees	653		704

The following is a summary of accounts receivable from and accounts payable to nonconsolidated equity investees:

In millions	March 31, 2024		December 31, 2023		Balance Sheet Location
Accounts receivable from nonconsolidated equity investees	$	425	$	530	Accounts and notes receivable, net
Accounts payable to nonconsolidated equity investees	325		324		Accounts payable (principally trade)

Supply Chain Financing

We currently have supply chain financing programs with financial intermediaries, which provide certain vendors the option to be paid by financial intermediaries earlier than the due date on the applicable invoice. When a vendor utilizes the program and receives an early payment from a financial intermediary, they take a discount on the invoice. We then pay the financial intermediary the face amount of the invoice on the original due date, which generally have 60 to 90 day payment terms. The maximum amount that we could have outstanding under the program was $512 million at March 31, 2024. We do not reimburse vendors for any costs they incur for participation in the program, their participation is completely voluntary and there are no assets pledged as security or other forms of guarantees provided for the committed payment to the finance provider or intermediary. As a result, all amounts owed to the financial intermediaries are presented as accounts payable in our Condensed Consolidated Balance Sheets. Amounts due to the financial intermediaries reflected in accounts payable at March 31, 2024, and December 31, 2023, were $193 million and $199 million, respectively.

NOTE 2. REVENUE FROM CONTRACTS WITH CUSTOMERS

Long-term Contracts

We have certain arrangements, primarily long-term maintenance agreements, construction contracts, product sales with associated performance obligations extending beyond a year, product sales with lead times extending beyond one year that are non-cancellable or for which the customer incurs a penalty for cancellation and extended warranty coverage arrangements that span a period in excess of one year. The aggregate amount of the transaction price for these contracts, excluding extended warranty coverage arrangements, as of March 31, 2024, was $3.1 billion. We expect to recognize the related revenue of $1.4 billion over the next 12 months and $1.7 billion over periods up to 10 years. See NOTE 10, "PRODUCT WARRANTY LIABILITY," for additional disclosures on extended warranty coverage arrangements. Our other contracts generally are for a duration of less than one year, include payment terms that correspond to the timing of costs incurred when providing goods and services to our customers or represent sales-based royalties.

9

Deferred and Unbilled Revenue

The following is a summary of our unbilled and deferred revenue and related activity:

In millions	March 31, 2024		December 31, 2023
Unbilled revenue	$	330	$	303
Deferred revenue	2,297		2,186

We recognized revenue of $248 million for the three months ended March 31, 2024, compared with $206 million for the comparable period in 2023, that was included in the deferred revenue balance at the beginning of each year. We did not record any impairment losses on our unbilled revenues during the three months ended March 31, 2024 or 2023.

Disaggregation of Revenue

Consolidated Revenue

The table below presents our consolidated sales by geographic area. Net sales attributed to geographic areas were based on the location of the customer.

	Three months ended
	March 31,
In millions	2024		2023
United States	$	4,785	$	4,802
China	723		790
India	444		411
Other international	2,451		2,450
Total net sales	$	8,403	$	8,453

Segment Revenue

Components segment external sales by business were as follows:

	Three months ended
	March 31,
In millions	2024			2023
Axles and brakes	$	1,232		$	1,272
Emission solutions	856			939
Atmus	289		(1)	342
Engine components	271			292
Automated transmissions	165			178
Software and electronics	29			20
Total sales	$	2,842		$	3,043
(1) Included sales through the March 18, 2024, divestiture. See NOTE 14, "ATMUS DIVESTITURE," for additional information.

10

Engine segment external sales by market were as follows:

	Three months ended
	March 31,
In millions	2024		2023
Heavy-duty truck	$	811	$	860
Medium-duty truck and bus	738		617
Light-duty automotive	438		441
Total on-highway	1,987		1,918
Off-highway	253		334
Total sales	$	2,240	$	2,252

Distribution segment external sales by region were as follows:

	Three months ended
	March 31,
In millions	2024		2023
North America	$	1,722	$	1,693
Asia Pacific	285		239
Europe	240		194
China	100		101
India	69		57
Latin America	59		53
Africa and Middle East	54		62
Total sales	$	2,529	$	2,399

Distribution segment external sales by product line were as follows:

	Three months ended
	March 31,
In millions	2024		2023
Parts	$	997	$	1,052
Power generation	705		491
Engines	422		456
Service	405		400
Total sales	$	2,529	$	2,399

Power Systems segment external sales by product line were as follows:

	Three months ended
	March 31,
In millions	2024		2023
Power generation	$	360	$	380
Industrial	238		189
Generator technologies	110		110
Total sales	$	708	$	679

11

NOTE 3. PENSIONS AND OTHER POSTRETIREMENT BENEFITS

We sponsor funded and unfunded domestic and foreign defined benefit pension and other postretirement benefit (OPEB) plans. Contributions to these plans were as follows:

	Three months ended
	March 31,
In millions	2024		2023
Defined benefit pension contributions	$	39	$	88
OPEB payments, net	9		4
Defined contribution pension plans	48		43

We anticipate making additional defined benefit pension contributions during the remainder of 2024 of $29 million for our U.S. and U.K. qualified and non-qualified pension plans. These contributions may be made from trusts or company funds either to increase pension assets or to make direct benefit payments to plan participants. We expect our 2024 annual net periodic pension cost to approximate $34 million.

The components of net periodic pension and OPEB expense (income) under our plans were as follows:

	Pension
	U.S. Plans				U.K. Plans				OPEB
	Three months ended March 31,
In millions	2024		2023		2024		2023		2024		2023
Service cost	$	35	$	29	$	4	$	4	$	—	$	—
Interest cost	42		42		18		17		2		2
Expected return on plan assets	(72)		(69)		(25)		(25)		—		—
Recognized net actuarial loss (gain)	3		2		3		—		(1)		(1)
Net periodic benefit expense (income)	$	8	$	4	$	—	$	(4)	$	1	$	1

NOTE 4. EQUITY, ROYALTY AND INTEREST INCOME FROM INVESTEES

Equity, royalty and interest income from investees included in our Condensed Consolidated Statements of Net Income for the reporting period was as follows:

	Three months ended
	March 31,
In millions	2024		2023
Manufacturing entities
Dongfeng Cummins Engine Company, Ltd.	$	22	$	19
Chongqing Cummins Engine Company, Ltd.	15		9
Beijing Foton Cummins Engine Co., Ltd.	13		16
Tata Cummins, Ltd.	9		8
All other manufacturers	23		19
Distribution entities
Komatsu Cummins Chile, Ltda.	13		14
All other distributors	5		3
Cummins share of net income	100		88
Royalty and interest income	23		31
Equity, royalty and interest income from investees	$	123	$	119

12

In September 2023, our Accelera business signed an agreement to form a joint venture with Daimler Trucks and Buses US Holding LLC (Daimler Truck), PACCAR Inc. (PACCAR) and EVE Energy to accelerate and localize battery cell production and the battery supply chain in the U.S., including building a 21-gigawatt hour battery production facility in Marshall County, Mississippi. The joint venture will manufacture battery cells for electric commercial vehicles and industrial applications. Accelera, Daimler Truck and PACCAR will each own 30 percent of the joint venture, while EVE Energy will own 10 percent. Total investment by the partners is expected to be in the range of $2 billion to $3 billion for the 21-gigawatt hour facility. The transaction received all applicable merger control and regulatory approvals during or prior to April 2024, and the joint venture formation and initial funding are expected to be finalized in the second quarter of 2024.

NOTE 5. INCOME TAXES

Our effective tax rates for the three months ended March 31, 2024 and 2023, were 8.7 percent and 21.7 percent, respectively.

The three months ended March 31, 2024, contained favorable discrete tax items primarily due to the $1.3 billion non-taxable gain on the Atmus split-off. Other discrete tax items were $21 million favorable primarily due to adjustments related to audit settlements.

The three months ended March 31, 2023, contained favorable discrete tax items of $3 million, primarily due to share-based compensation tax benefits.

NOTE 6. MARKETABLE SECURITIES

A summary of marketable securities, all of which were classified as current, was as follows:

	March 31, 2024						December 31, 2023
In millions	Cost		Gross unrealized gains/(losses) (1)		Estimated fair value		Cost		Gross unrealized gains/(losses) (1)		Estimated fair value
Equity securities
Certificates of deposit	$	245	$	—	$	245	$	246	$	—	$	246
Debt mutual funds	225		(1)		224		272		—		272
Equity mutual funds	21		7		28		22		6		28
Debt securities	13		—		13		16		—		16
Marketable securities	$	504	$	6	$	510	$	556	$	6	$	562
(1) Unrealized gains and losses for debt securities are recorded in other comprehensive income while unrealized gains and losses for equity securities are recorded in our Condensed Consolidated Statements of Net Income.

All debt securities are classified as available-for-sale. All marketable securities presented use a Level 2 fair value measure. The fair value of Level 2 securities is estimated using actively quoted prices for similar instruments from brokers and observable inputs where available, including market transactions and third-party pricing services, or net asset values provided to investors. We do not currently have any Level 3 securities, and there were no transfers between Level 2 or 3 during the three months ended March 31, 2024, or the year ended December 31, 2023.

A description of the valuation techniques and inputs used for our Level 2 fair value measures is as follows:

•Certificates of deposit — These investments provide us with a contractual rate of return and generally range in maturity from three months to five years. The counterparties to these investments are reputable financial institutions with investment grade credit ratings. Since these instruments are not tradable and must be settled directly by us with the respective financial institution, our fair value measure is the financial institution's month-end statement.

•Debt mutual funds — The fair value measures for the vast majority of these investments are the daily net asset values published on a regulated governmental website. Daily quoted prices are available from the issuing brokerage and are used on a test basis to corroborate this Level 2 input measure.

•Equity mutual funds — The fair value measures for these investments are the net asset values published by the issuing brokerage. Daily quoted prices are available from reputable third-party pricing services and are used on a test basis to corroborate this Level 2 input measure.

•Debt securities — The fair value measures for these securities are broker quotes received from reputable firms. These securities are infrequently traded on a national exchange and these values are used on a test basis to corroborate our Level 2 input measure.

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The proceeds from sales and maturities of marketable securities were as follows:

	Three months ended
	March 31,
In millions	2024		2023
Proceeds from sales of marketable securities	$	426	$	276
Proceeds from maturities of marketable securities	5		69
Investments in marketable securities - liquidations	$	431	$	345

NOTE 7. INVENTORIES

Inventories are stated at the lower of cost or net realizable value. Inventories included the following:

 

In millions	March 31, 2024		December 31, 2023
Finished products	$	2,931	$	2,770
Work-in-process and raw materials	3,049		3,156
Inventories at FIFO cost	5,980		5,926
Excess of FIFO over LIFO	(222)		(249)
Inventories	$	5,758	$	5,677

NOTE 8. SUPPLEMENTAL BALANCE SHEET DATA

Other assets included the following:

In millions	March 31, 2024		December 31, 2023
Deferred income taxes	$	950	$	1,082
Operating lease assets	455		501
Corporate owned life insurance	419		417
Other	550		543
Other assets	$	2,374	$	2,543

Other accrued expenses included the following:

In millions	March 31, 2024		December 31, 2023
Settlement Agreements (1)	$	1,938	$	1,938
Income taxes payable	361		242
Marketing accruals	340		399
Other taxes payable	222		296
Current portion of operating lease liabilities	129		138
Other	707		741
Other accrued expenses	$	3,697	$	3,754
(1) See NOTE 11, "COMMITMENTS AND CONTINGENCIES," for additional information.

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Other liabilities included the following:

In millions	March 31, 2024		December 31, 2023
Accrued product warranty (1)	$	816	$	777
Pensions	495		530
Deferred income taxes	355		530
Operating lease liabilities	332		374
Accrued compensation	186		213
Mark-to-market valuation on interest rate derivatives	124		117
Other postretirement benefits	123		131
Long-term income taxes	111		111
Other	666		647
Other liabilities	$	3,208	$	3,430
(1) See NOTE 10, "PRODUCT WARRANTY LIABILITY," for additional information.

NOTE 9. DEBT

Loans Payable and Commercial Paper

Loans payable, commercial paper and the related weighted-average interest rates were as follows:

In millions	March 31, 2024		December 31, 2023
Loans payable (1)	$	342	$	280
Commercial paper (2)	609		1,496
(1) Loans payable consist primarily of notes payable to various domestic and international financial institutions. It is not practicable to aggregate these notes and calculate a quarterly weighted-average interest rate.
(2) The weighted-average interest rate, inclusive of all brokerage fees, was 5.23 percent and 5.43 percent at March 31, 2024, and December 31, 2023, respectively.

We can issue up to $4.0 billion of unsecured, short-term promissory notes (commercial paper) pursuant to the Board of Directors authorized commercial paper programs. These programs facilitate the private placement of unsecured short-term debt through third-party brokers. We intend to use the net proceeds from the commercial paper borrowings for general corporate purposes.

Revolving Credit Facilities

Our committed credit facilities provide access up to $4.0 billion, including our $2.0 billion 364-day facility that expires June 3, 2024, and our $2.0 billion five-year facility that expires on August 18, 2026. We intend to maintain credit facilities at the current or higher aggregate amounts by renewing or replacing these facilities at or before expiration. These revolving credit facilities are maintained primarily to provide backup liquidity for our commercial paper borrowings and general corporate purposes. There were no outstanding borrowings under these facilities at March 31, 2024, and December 31, 2023. At March 31, 2024, the $609 million of outstanding commercial paper effectively reduced the $4.0 billion of revolving credit capacity to $3.4 billion.

At March 31, 2024, we also had an additional $396 million available for borrowings under our international and other domestic credit facilities.

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Long-term Debt

A summary of long-term debt was as follows:

In millions	Interest Rate	March 31, 2024		December 31, 2023
Long-term debt
Hydrogenics promissory notes, due 2024 and 2025	—%	$	160	$	160
Term loan, due 2025 (1) (2)	Variable	500		1,150
Senior notes, due 2025 (3)	0.75%	500		500
Atmus term loan, due 2027 (4)	Variable	—		600
Debentures, due 2027	6.75%	58		58
Debentures, due 2028	7.125%	250		250
Senior notes, due 2029	4.90%	500		—
Senior notes, due 2030 (3)	1.50%	850		850
Senior notes, due 2034	5.15%	750		—
Senior notes, due 2043	4.875%	500		500
Senior notes, due 2050	2.60%	650		650
Senior notes, due 2054	5.45%	1,000		—
Debentures, due 2098 (5)	5.65%	165		165
Other debt		90		94
Unamortized discount and deferred issuance costs		(100)		(72)
Fair value adjustments due to hedge on indebtedness		(111)		(96)
Finance leases		122		111
Total long-term debt		5,884		4,920
Less: Current maturities of long-term debt		113		118
Long-term debt		$	5,771	$	4,802
(1) During the first three months of 2024, we paid down $650 million of the term loan.
(2) In 2023, we entered into a series of interest rate swaps in order to trade a portion of the floating rate debt into fixed rate. See "Interest Rate Risk" in NOTE 13, "DERIVATIVES," for additional information.
(3) In 2021, we entered into a series of interest rate swaps to effectively convert debt from a fixed rate to floating rate. See "Interest Rate Risk" in NOTE 13, "DERIVATIVES," for additional information.
(4) See NOTE 14, "ATMUS DIVESTITURE," for additional information.
(5) The effective interest rate is 7.48 percent.

On February 20, 2024, we issued $2.25 billion aggregate principal amount of senior unsecured notes consisting of $500 million aggregate principal amount of 4.90 percent senior unsecured notes due in 2029, $750 million aggregate principal amount of 5.15 percent senior unsecured notes due in 2034 and $1.0 billion aggregate principal amount of 5.45 percent senior unsecured notes due in 2054. We received net proceeds of $2.2 billion. The senior unsecured notes pay interest semi-annually on February 20 and August 20, commencing on August 20, 2024. The indenture governing the senior unsecured notes contains covenants that, among other matters, limit (i) our ability to consolidate or merge into, or sell, assign, convey, lease, transfer or otherwise dispose of all or substantially all of our and our subsidiaries' assets to another person, (ii) our and certain of our subsidiaries' ability to create or assume liens and (iii) our and certain of our subsidiaries' ability to engage in sale and leaseback transactions.

Principal payments required on long-term debt during the next five years are as follows:

In millions	2024		2025		2026		2027		2028
Principal payments	$	101	$	1,128	$	41	$	76	$	267

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Fair Value of Debt

Based on borrowing rates currently available to us for bank loans with similar terms and average maturities, considering our risk premium, the fair values and carrying values of total debt, including current maturities, were as follows:

 

In millions	March 31, 2024		December 31, 2023
Fair value of total debt (1)	$	6,491	$	6,375
Carrying value of total debt	6,835		6,696
(1) The fair value of debt is derived from Level 2 input measures.

NOTE 10. PRODUCT WARRANTY LIABILITY

A tabular reconciliation of the product warranty liability, including the deferred revenue related to our extended warranty coverage and accrued product campaigns, was as follows:

	Three months ended
	March 31,
In millions	2024		2023
Balance at beginning of year	$	2,497	$	2,477
Provision for base warranties issued	160		146
Deferred revenue on extended warranty contracts sold	96		102
Provision for product campaigns issued	6		6
Payments made during period	(176)		(143)
Amortization of deferred revenue on extended warranty contracts	(77)		(75)
Changes in estimates for pre-existing product warranties and campaigns	51		10
Foreign currency translation adjustments and other	(18)		7
Balance at end of period	$	2,539	$	2,530

We recognized supplier recoveries of $22 million for the three months ended March 31, 2024, compared with $10 million for the comparable period in 2023.

Warranty related deferred revenues and warranty liabilities on our Condensed Consolidated Balance Sheets were as follows:

In millions	March 31, 2024		December 31, 2023		Balance Sheet Location
Deferred revenue related to extended coverage programs
Current portion	$	274	$	279	Current portion of deferred revenue
Long-term portion	797		774		Deferred revenue
Total	$	1,071	$	1,053
Product warranty
Current portion	$	652	$	667	Current portion of accrued product warranty
Long-term portion	816		777		Other liabilities
Total	$	1,468	$	1,444
Total warranty accrual	$	2,539	$	2,497

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NOTE 11. COMMITMENTS AND CONTINGENCIES

Legal Proceedings

We are subject to numerous lawsuits and claims arising out of the ordinary course of our business, including actions related to product liability; personal injury; the use and performance of our products; warranty matters; product recalls; patent, trademark or other intellectual property infringement; contractual liability; the conduct of our business; tax reporting in foreign jurisdictions; distributor termination; workplace safety; environmental and regulatory matters, including the enforcement of environmental and emissions standards; and asbestos claims. We also have been identified as a potentially responsible party at multiple waste disposal sites under U.S. federal and related state environmental statutes and regulations and may have joint and several liability for any investigation and remediation costs incurred with respect to such sites. We have denied liability with respect to many of these lawsuits, claims and proceedings and are vigorously defending such lawsuits, claims and proceedings. We carry various forms of commercial, property and casualty, product liability and other forms of insurance; however, such insurance may not be applicable or adequate to cover the costs associated with a judgment against us with respect to these lawsuits, claims and proceedings. We do not believe that these lawsuits are material individually or in the aggregate. While we believe we have also established adequate accruals for our expected future liability with respect to pending lawsuits, claims and proceedings, where the nature and extent of any such liability can be reasonably estimated based upon then presently available information, there can be no assurance that the final resolution of any existing or future lawsuits, claims or proceedings will not have a material adverse effect on our business, results of operations, financial condition or cash flows.

We conduct significant business operations in Brazil that are subject to the Brazilian federal, state and local labor, social security, tax and customs laws. While we believe we comply with such laws, they are complex, subject to varying interpretations and we are often engaged in litigation regarding the application of these laws to particular circumstances.

In December 2023, we announced that we reached an agreement in principle with the EPA, CARB, the Environmental and Natural Resources Division of the U.S. Department of Justice and the California Attorney General’s Office to resolve certain regulatory civil claims regarding our emissions certification and compliance process for certain engines primarily used in pick-up truck applications in the U.S., which became final and effective in April 2024 (collectively, the Settlement Agreements). As part of the Settlement Agreements, among other things, we agreed to pay civil penalties, complete recall requirements, undertake mitigation projects, provide extended warranties, undertake certain testing, take certain corporate compliance measures and make other payments. Failure to comply with the Settlement Agreements will subject us to stipulated penalties. We recorded a charge of $2.0 billion in the fourth quarter of 2023 to resolve the matters addressed by the Settlement Agreements involving approximately one million of our pick-up truck applications in the U.S. This charge was in addition to the previously announced charges of $59 million for the recalls of model years 2013 through 2018 RAM 2500 and 3500 trucks and model years 2016 through 2019 Titan trucks. We began making payments on certain of the Settlement Agreements in April 2024; however, the majority of the Settlement Agreement payments will be made in May 2024.

We have also been in communication with other non-U.S. regulators regarding matters related to the emission systems in our engines and may also become subject to additional regulatory review in connection with these matters.

In connection with our announcement of our entry into the agreement in principle, we became subject to shareholder, consumer and third-party litigation regarding the matters covered by the Settlement Agreements, and we may become subject to additional litigation in connection with these matters.

The consequences resulting from the resolution of the foregoing matters are uncertain and the related expenses and reputational damage could have a material adverse impact on our results of operations, financial condition and cash flows.

Guarantees and Commitments

Periodically, we enter into guarantee arrangements, including guarantees of non-U.S. distributor financings, residual value guarantees on equipment under operating leases and other miscellaneous guarantees of joint ventures or third-party obligations. At March 31, 2024, the maximum potential loss related to these guarantees was $39 million.

We have arrangements with certain suppliers that require us to purchase minimum volumes or be subject to monetary penalties. At March 31, 2024, if we were to stop purchasing from each of these suppliers, the aggregate amount of the penalty would be approximately $584 million. These arrangements enable us to secure supplies of critical components and IT services. We do not currently anticipate paying any penalties under these contracts.

We enter into physical forward contracts with suppliers of platinum, palladium and iridium to purchase certain volumes of the commodities at contractually stated prices for various periods, which generally fall within two years. At March 31, 2024, the total commitments under these contracts were $64 million. These arrangements enable us to guarantee the prices of these commodities, which otherwise are subject to market volatility.

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We have guarantees with certain customers that require us to satisfactorily honor contractual or regulatory obligations, or compensate for monetary losses related to nonperformance. These performance bonds and other performance-related guarantees were $192 million at March 31, 2024.

Indemnifications

Periodically, we enter into various contractual arrangements where we agree to indemnify a third-party against certain types of losses. Common types of indemnities include:

•product liability and license, patent or trademark indemnifications;

•asset sale agreements where we agree to indemnify the purchaser against future environmental exposures related to the asset sold; and

•any contractual agreement where we agree to indemnify the counterparty for losses suffered as a result of a misrepresentation in the contract.

We regularly evaluate the probability of having to incur costs associated with these indemnities and accrue for expected losses that are probable. Because the indemnifications are not related to specified known liabilities and due to their uncertain nature, we are unable to estimate the maximum amount of the potential loss associated with these indemnifications.

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NOTE 12. ACCUMULATED OTHER COMPREHENSIVE LOSS

Following are the changes in accumulated other comprehensive income (loss) by component for the three months ended:

In millions	Change in pension and OPEB plans		Foreign currency translation adjustment			Unrealized gain (loss) on derivatives		Total attributable to Cummins Inc.		Noncontrolling interests		Total
Balance at December 31, 2023	$	(848)	$	(1,457)		$	99	$	(2,206)
Other comprehensive income (loss) before reclassifications
Before-tax amount	(21)		(116)			22		(115)		$	(3)	$	(118)
Tax expense	3		(2)			(5)		(4)		—		(4)
After-tax amount	(18)		(118)			17		(119)		(3)		(122)
Amounts reclassified from accumulated other comprehensive income (loss) (1)	5		61		(2)	(5)		61		—		61
Net current period other comprehensive (loss) income	(13)		(57)			12		(58)		$	(3)	$	(61)
Balance at March 31, 2024	$	(861)	$	(1,514)		$	111	$	(2,264)
Balance at December 31, 2022	$	(427)	$	(1,552)		$	89	$	(1,890)
Other comprehensive income (loss) before reclassifications
Before-tax amount	(13)		75			(3)		59		$	3	$	62
Tax benefit	2		4			1		7		—		7
After-tax amount	(11)		79			(2)		66		3		69
Amounts reclassified from accumulated other comprehensive income (loss) (1)	2		—			(1)		1		—		1
Net current period other comprehensive (loss) income	(9)		79			(3)		67		$	3	$	70
Balance at March 31, 2023	$	(436)	$	(1,473)		$	86	$	(1,823)
(1) Amounts are net of tax. Reclassifications out of accumulated other comprehensive income (loss) and the related tax effects are immaterial for separate disclosure.
(2) Primarily related to the divestiture of Atmus. See NOTE 14, "ATMUS DIVESTITURE," for additional information.

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NOTE 13. DERIVATIVES

We are exposed to financial risk resulting from volatility in foreign exchange rates, interest rates and commodity prices. This risk is closely monitored and managed through the use of physical forward contracts (which are not considered derivatives) and financial derivative instruments including foreign currency forward contracts, commodity swap contracts and interest rate swaps. Financial derivatives are used expressly for hedging purposes and under no circumstances are they used for speculative purposes. When material, we adjust the estimated fair value of our derivative contracts for counterparty or our credit risk. None of our derivative instruments are subject to collateral requirements. Substantially all of our derivative contracts are subject to master netting arrangements, which provide us with the option to settle certain contracts on a net basis when they settle on the same day with the same currency. In addition, these arrangements provide for a net settlement of all contracts with a given counterparty in the event that the arrangement is terminated due to the occurrence of default or a termination event.

Foreign Currency Exchange Rate Risk

We had foreign currency forward contracts with notional amounts of $5.0 billion at March 31, 2024, with the following currencies comprising 86 percent of outstanding foreign currency forward contracts: British pound, Chinese renminbi, Canadian dollar, Australian dollar and Euro. We had foreign currency forward contracts with notional amounts of $4.5 billion at December 31, 2023, with the following currencies comprising 85 percent of outstanding foreign currency forward contracts: British pound, Chinese renminbi, Canadian dollar, Australian dollar and Swedish kronor.

We are further exposed to foreign currency exchange risk as many of our subsidiaries are subject to fluctuations as the functional currencies of the underlying entities are not our U.S. dollar reporting currency. To help reduce volatility in the equity value of our subsidiaries, we enter into foreign exchange forwards designated as net investment hedges for certain of our investments. Under the current terms of our foreign exchange forwards, we agreed with third parties to sell British pounds and Chinese renminbi in exchange for U.S. dollar currency at a specified rate at the maturity of the contract. The notional amount of these hedges at March 31, 2024, was $1.0 billion.

The following table summarizes the net investment hedge activity in accumulated other comprehensive loss (AOCL):

	Three months ended
	March 31,
In millions	2024				2023
Type of Derivative	Gain (Loss)  Recognized in AOCL		Gain (Loss) Reclassified from AOCL into Earnings		Gain (Loss)  Recognized in AOCL		Gain (Loss) Reclassified from AOCL into Earnings
Foreign exchange forwards	$	6	$	—	$	(15)	$	—

Interest Rate Risk

In September 2023, we entered into a series of interest rate swaps with a total notional value of $500 million in order to trade a portion of the floating rate into a fixed rate on our term loan, due in 2025. The maturity date of the interest rate swaps is August 1, 2025. The weighted-average interest rate of the interest rate swaps is 5.72 percent. We designated the swaps as cash flow hedges. The gains and losses on these derivative instruments are initially recorded in other comprehensive income and reclassified into earnings as interest expense in the Condensed Consolidated Financial Statements as each interest payment is accrued.

The following table summarizes the interest rate swap activity in AOCL:

	Three months ended
	March 31,
In millions	2024
Type of Swap	Gain (Loss)  Recognized in AOCL		Gain (Loss) Reclassified from AOCL into Interest Expense
Interest rate swaps	$	3	$	—

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In 2021, we entered into a series of interest rate swaps to effectively convert our $500 million senior notes, due in 2025, from a fixed rate of 0.75 percent to a floating rate equal to the three-month London Interbank Offered Rate (LIBOR) plus a spread (subsequently adjusted to Secured Overnight Financing Rate (SOFR) under a fallback protocol in our derivative agreements in the third quarter of 2023), and $400 million of the notional amount remained unsettled at March 31, 2024. We also entered into a series of interest rate swaps to effectively convert $765 million of our $850 million senior notes, due in 2030, from a fixed rate of 1.50 percent to a floating rate equal to the three-month LIBOR plus a spread (also similarly adjusted to SOFR). We designated the swaps as fair value hedges. The gain or loss on these derivative instruments, as well as the offsetting gain or loss on the hedged item attributable to the hedged risk, are recognized in current income as interest expense. The net swap settlements that accrue each period are also reported in the Condensed Consolidated Financial Statements as interest expense.

The following table summarizes the gains and losses:

	Three months ended
	March 31,
In millions	2024				2023
Type of Swap	Gain (Loss)  on Swaps		Gain (Loss) on Borrowings		Gain (Loss)  on Swaps		Gain (Loss) on Borrowings
Interest rate swaps (1)	$	(10)	$	14	$	27	$	(22)
(1) The difference between the gain (loss) on swaps and borrowings represents hedge ineffectiveness.

Derivatives Not Designated as Hedging Instruments

The following table summarizes the effect on our Condensed Consolidated Statements of Net Income for derivative instruments not designated as hedging instruments:

	Three months ended
	March 31,
In millions	2024		2023
Loss recognized in income - Cost of sales (1)	$	—	$	(2)
(Loss) gain recognized in income - Other income (expense), net (1)	(40)		27
(1) Includes foreign currency forward contracts.

Fair Value Amount and Location of Derivative Instruments

The following table summarizes the location and fair value of derivative instruments on our Condensed Consolidated Balance Sheets:

	Derivatives Designated as Hedging Instruments				Derivatives Not Designated as Hedging Instruments
In millions	March 31, 2024		December 31, 2023		March 31, 2024		December 31, 2023
Notional amount	$	3,257	$	2,997	$	4,064	$	3,610
Derivative assets
Prepaid expenses and other current assets (1)	$	21	$	14	$	9	$	16
Derivative liabilities
Other accrued expenses	$	4	$	43	$	8	$	14
Other liabilities	124		117		11		—
Total derivative liabilities (1)	$	128	$	160	$	19	$	14
(1) Estimates of the fair value of all derivative assets and liabilities above are derived from Level 2 inputs, which are estimated using actively quoted prices for similar instruments from brokers and observable inputs where available, including market transactions and third-party pricing services, or net asset values provided to investors. We do not currently have any Level 3 input measures and there were no transfers into or out of Level 2 or 3 during the three months ended March 31, 2024, or the year ended December 31, 2023.

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We elected to present our derivative contracts on a gross basis in our Condensed Consolidated Balance Sheets. Had we chosen to present on a net basis, we would have derivatives in a net asset position of $13 million and $4 million and derivatives in a net liability position of $130 million and $148 million at March 31, 2024, and December 31, 2023, respectively.

NOTE 14. ATMUS DIVESTITURE

On March 18, 2024, we completed the divestiture of our remaining 80.5 percent ownership of Atmus common stock through a tax-free split-off. The transaction involved the exchange of our shares in Atmus for shares of Cummins stock with a 7.0 percent discount on the exchange ratio for Atmus shares. The exchange ratio was determined based on each entity's respective stock price using the daily volume weighted-average stock price for three days preceding the final exchange offer date. Based on the final exchange ratio, we exchanged all 67 million of our Atmus shares for 5.6 million shares of Cummins stock, which was recorded as treasury stock based on the fair value of the Cummins shares obtained.

We evaluated the full divestiture of Atmus and determined the transaction did not qualify for discontinued operation presentation. We recognized a gain related to the divestiture of approximately $1.3 billion (based on the difference between the fair value of the Cummins shares obtained less the carrying value of our Atmus investment), which was recorded as other income in the Condensed Consolidated Statements of Net Income for the three months ended March 31, 2024. Approximately $114 million of goodwill was included in the carrying value of the Atmus investment for purposes of calculating the gain. The operating results of Atmus were reported in the Condensed Consolidated Financial Statements through March 18, 2024, the date of divestiture.

As part of the divestiture, the $600 million term loan remained with Atmus after the split. In addition, a net $61 million of other comprehensive income and $19 million of noncontrolling interests related to Atmus were written-off and netted against the gain recognized upon the split.

We entered into a transitional services agreement (TSA) with Atmus that is designed to facilitate the orderly transfer of various services to Atmus. The TSA relates primarily to administrative services, which are generally to be provided over the next 24 months. This agreement is not material and does not confer upon us the ability to influence the operating and/or financial policies of Atmus subsequent to March 18, 2024.

NOTE 15. OPERATING SEGMENTS

Operating segments under GAAP are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the Chief Operating Decision Maker (CODM), or decision-making group, in deciding how to allocate resources and in assessing performance. Our CODM is the Chief Executive Officer.

Our reportable operating segments consist of Components, Engine, Distribution, Power Systems and Accelera. This reporting structure is organized according to the products and markets each segment serves. The Components segment sells axles, drivelines, brakes and suspension systems for commercial diesel and natural gas applications, aftertreatment systems, turbochargers, fuel systems, valvetrain technologies, automated transmissions and electronics. The Engine segment produces engines (15 liters and smaller) and associated parts for sale to customers in on-highway and various off-highway markets. Our engines are used in trucks of all sizes, buses and recreational vehicles, as well as in various industrial applications, including construction, agriculture, power generation systems and other off-highway applications. The Distribution segment includes wholly-owned and partially-owned distributorships engaged in wholesaling engines, generator sets and service parts, as well as performing service and repair activities on our products and maintaining relationships with various OEMs throughout the world. The Power Systems segment is an integrated power provider, which designs, manufactures and sells engines (16 liters and larger) for industrial applications (including mining, oil and gas, marine and rail), standby and prime power generator sets, alternators and other power components. The Accelera segment designs, manufactures, sells and supports hydrogen production technologies as well as electrified power systems with innovative components and subsystems, including battery, fuel cell and electric powertrain technologies. The Accelera segment is currently in the early stages of commercializing these technologies with efforts primarily focused on the development of our electrolyzers for hydrogen production and electrified power systems and related components and subsystems. We continue to serve all our markets as they adopt electrification and alternative power technologies, meeting the needs of our OEM partners and end customers.

We use segment earnings or losses before interest expense, income taxes, depreciation and amortization and noncontrolling interests (EBITDA) as the basis for the CODM to evaluate the performance of each of our reportable operating segments. We believe EBITDA is a useful measure of our operating performance as it assists investors and debt holders in comparing our performance on a consistent basis without regard to financing methods, capital structure, income taxes or depreciation and amortization methods, which can vary significantly depending upon many factors. Segment amounts exclude certain expenses not specifically identifiable to segments.

The accounting policies of our operating segments are the same as those applied in our Condensed Consolidated Financial Statements. We prepared the financial results of our operating segments on a basis that is consistent with the manner in which we internally disaggregate financial information to assist in making internal operating decisions. We allocate certain common costs and expenses, primarily corporate functions, among segments differently than we would for stand-alone financial information prepared in accordance

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with GAAP. These include certain costs and expenses of shared services, such as information technology, human resources, legal, finance and supply chain management. We do not allocate gains or losses of corporate owned life insurance and the gain and certain costs related to the divestiture of Atmus. See NOTE 14, "ATMUS DIVESTITURE," for additional information. EBITDA may not be consistent with measures used by other companies.

Summarized financial information regarding our reportable operating segments for the three months ended is shown in the table below:

In millions	Components			Engine		Distribution		Power Systems		Accelera		Total Segments
Three months ended March 31, 2024
External sales	$	2,842		$	2,240	$	2,529	$	708	$	84	$	8,403
Intersegment sales	490			688		6		681		9		1,874
Total sales	3,332			2,928		2,535		1,389		93		10,277
Research, development and engineering expenses	84			154		14		60		55		367
Equity, royalty and interest income (loss) from investees	26			57		24		19		(3)		123
Interest income	8			7		11		3		—		29
Segment EBITDA	473		(1)	414		294		237		(101)		1,317
Depreciation and amortization (2)	125			58		31		34		14		262
Three months ended March 31, 2023
External sales	$	3,043		$	2,252	$	2,399	$	679	$	80	$	8,453
Intersegment sales	514			734		7		664		5		1,924
Total sales	3,557			2,986		2,406		1,343		85		10,377
Research, development and engineering expenses	91			134		14		63		48		350
Equity, royalty and interest income (loss) from investees	21			65		24		13		(4)		119
Interest income	6			3		7		2		—		18
Segment EBITDA	507		(3)	457		335		219		(94)		1,424
Depreciation and amortization (2)	123			51		28		29		14		245
(1) Included $21 million costs associated with the divestiture of Atmus for the three months ended March 31, 2024. See NOTE 14, "ATMUS DIVESTITURE," for additional information.
(2) Depreciation and amortization, as shown on a segment basis, excludes the amortization of debt discount and deferred costs included in the Condensed Consolidated Statements of Net Income as interest expense. The amortization of debt discount and deferred costs was $3 million and $1 million for the three months ended March 31, 2024 and 2023, respectively. A portion of depreciation expense is included in research, development and engineering expenses.
(3) Included $12 million of costs associated with the divestiture of Atmus for the three months ended March 31, 2023.

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A reconciliation of our segment information to the corresponding amounts in the Condensed Consolidated Statements of Net Income is shown in the table below:

	Three months ended
	March 31,
In millions	2024			2023
TOTAL SEGMENT EBITDA	$	1,317		$	1,424
Intersegment eliminations and other (1)	1,255		(2)	(63)		(3)
Less:
Interest expense	89			87
Depreciation and amortization	262			245
INCOME BEFORE INCOME TAXES	$	2,221		$	1,029
(1) Included intersegment sales, intersegment profit in inventory and unallocated corporate expenses.
(2) Included $1.3 billion of gain related the divestiture of Atmus and $14 million of costs associated with the divestiture of Atmus (included in corporate expenses) for the three months ended March 31, 2024. See NOTE 14, "ATMUS DIVESTITURE," for additional information.
(3) Included $6 million of costs associated with the divestiture of Atmus for the three months ended March 31, 2023.

NOTE 16. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In November 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures," to enhance disclosures for significant segment expenses for all public entities required to report segment information in accordance with ASC 280. The standard did not change the definition of a segment, the method for determining segments or the criteria for aggregating operating segments into reportable segments. The amendments are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Retrospective adoption is required for all prior periods presented in the financial statements. We plan to adopt the standard beginning with our 2024 Form 10-K. The adoption is not expected to have a material impact to our financial statements or disclosures.

In December 2023, the FASB issued ASU 2023-09, "Income Taxes (Topic 740): Improvements in Income Tax Disclosures," to enhance the transparency and decision usefulness of income tax disclosures. This amendment requires public companies to disclose specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. Additionally, under the amendment entities are required to disclose the amount of income taxes paid disaggregated by federal, state and foreign taxes, as well as disaggregated by material individual jurisdictions. Finally, the amendment requires entities to disclose income from continuing operations before income tax expense disaggregated between domestic and foreign and income tax expense from continuing operations disaggregated by federal, state and foreign. The new rules are effective for annual periods beginning after December 15, 2024. We will adopt this standard on a prospective basis as allowed by the standard beginning with our 2025 Form 10-K. The adoption of this standard is not expected to have a material impact on our Condensed Consolidated Financial Statements.

NOTE 17. SUBSEQUENT EVENTS

Early Settlement of Interest Rate Swaps and Early Debt Payments

In April 2024, we settled a portion of our 2023 interest rate swaps with a notional amount of $100 million in conjunction with repayment of $100 million of our term loan, due 2025. The loss on settlement recognized was immaterial.

Issuance of Commercial Paper

In April 2024, we issued approximately $1.0 billion of commercial paper in anticipation of paying the substantial majority of payments required under the Settlement Agreements in May 2024. See NOTE 11, “COMMITMENTS AND CONTINGENCIES,” for additional information on the Settlement Agreements.

Net Investment Hedge

In April 2024, we entered into additional net investments hedges with a notional amount of $250 million where we agreed with third parties to sell Chinese renminbi in exchange for U.S. dollar currency at a specified rate at the maturity of the contract.

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ITEM 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations

Cummins Inc. and its consolidated subsidiaries are hereinafter sometimes referred to as “Cummins,” “we,” “our” or “us.”

CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING INFORMATION

Certain parts of this quarterly report contain forward-looking statements intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include those that are based on current expectations, estimates and projections about the industries in which we operate and management’s beliefs and assumptions. Forward-looking statements are generally accompanied by words such as "anticipates," "expects," "forecasts," "intends," "plans," "believes," "seeks," "estimates," "could," "should," "may" or words of similar meaning. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions, which we refer to as "future factors," which are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. Some future factors that could cause our results to differ materially from the results discussed in such forward-looking statements are discussed below and shareholders, potential investors and other readers are urged to consider these future factors carefully in evaluating forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. Future factors that could affect the outcome of forward-looking statements include the following:

GOVERNMENT REGULATION

•any adverse consequences resulting from entering into the Settlement Agreements, including required additional mitigation projects, adverse reputational impacts and potential resulting legal actions;

•increased scrutiny from regulatory agencies, as well as unpredictability in the adoption, implementation and enforcement of emission standards around the world;

•evolving environmental and climate change legislation and regulatory initiatives;

•changes in international, national and regional trade laws, regulations and policies;

•changes in taxation;

•global legal and ethical compliance costs and risks;

•future bans or limitations on the use of diesel-powered products;

BUSINESS CONDITIONS / DISRUPTIONS

•failure to successfully integrate and / or failure to fully realize all of the anticipated benefits of the acquisition of Meritor, Inc.;

•raw material, transportation and labor price fluctuations and supply shortages;

•aligning our capacity and production with our demand;

•the actions of, and income from, joint ventures and other investees that we do not directly control;

•large truck manufacturers' and original equipment manufacturers' customers discontinuing outsourcing their engine supply needs or experiencing financial distress, or change in control;

PRODUCTS AND TECHNOLOGY

•product recalls;

•variability in material and commodity costs;

•the development of new technologies that reduce demand for our current products and services;

•lower than expected acceptance of new or existing products or services;

•product liability claims;

•our sales mix of products;

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GENERAL

•climate change, global warming, more stringent climate change regulations, accords, mitigation efforts, greenhouse gas regulations or other legislation designed to address climate change;

•our plan to reposition our portfolio of product offerings through exploration of strategic acquisitions and divestitures and related uncertainties of entering such transactions;

•increasing interest rates;

•challenging markets for talent and ability to attract, develop and retain key personnel;

•exposure to potential security breaches or other disruptions to our information technology environment and data security;

•political, economic and other risks from operations in numerous countries including political, economic and social uncertainty and the evolving globalization of our business;

•competitor activity;

•increasing competition, including increased global competition among our customers in emerging markets;

•failure to meet environmental, social and governance (ESG) expectations or standards, or achieve our ESG goals;

•labor relations or work stoppages;

•foreign currency exchange rate changes;

•the performance of our pension plan assets and volatility of discount rates;

•the price and availability of energy;

•continued availability of financing, financial instruments and financial resources in the amounts, at the times and on the terms required to support our future business; and

•other risk factors described in Part II, Item 1A in this quarterly report and our 2023 Form 10-K, Part I, Item 1A, both under the caption "Risk Factors."

Shareholders, potential investors and other readers are urged to consider these factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements made herein are made only as of the date of this quarterly report and we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

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ORGANIZATION OF INFORMATION 

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) was prepared to provide the reader with a view and perspective of our business through the eyes of management and should be read in conjunction with our Management's Discussion and Analysis of Financial Condition and Results of Operations section of our 2023 Form 10-K. Our MD&A is presented in the following sections:

•EXECUTIVE SUMMARY AND FINANCIAL HIGHLIGHTS

•RESULTS OF OPERATIONS

•OPERATING SEGMENT RESULTS

•OUTLOOK

•LIQUIDITY AND CAPITAL RESOURCES

•APPLICATION OF CRITICAL ACCOUNTING ESTIMATES

•RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

EXECUTIVE SUMMARY AND FINANCIAL HIGHLIGHTS

Overview

We are a global power solutions leader comprised of five business segments - Components, Engine, Distribution, Power Systems and Accelera - supported by our global manufacturing and extensive service and support network, skilled workforce and vast technical expertise. Our products range from advanced diesel, natural gas, electric and hybrid powertrains and powertrain-related components including aftertreatment, turbochargers, fuel systems, valvetrain technologies, controls systems, air handling systems, automated transmissions, axles, drivelines, brakes, suspension systems, electric power generation systems, batteries, electrified power systems, hydrogen production technologies and fuel cell products. We sell our products to original equipment manufacturers (OEMs), distributors, dealers and other customers worldwide. We have long-standing relationships with many of the leading manufacturers in the markets we serve, including PACCAR Inc, Traton Group, Daimler Trucks North America and Stellantis N.V. We serve our customers through a service network of approximately 450 wholly-owned, joint venture and independent distributor locations and more than 19,000 Cummins certified dealer locations in approximately 190 countries and territories.

Our segment reporting structure is organized according to the products and markets each segment serves. The Components segment sells axles, drivelines, brakes and suspension systems for commercial diesel and natural gas applications, aftertreatment systems, turbochargers, fuel systems, valvetrain technologies, automated transmissions and electronics. The Engine segment produces engines (15 liters and smaller) and associated parts for sale to customers in on-highway and various off-highway markets. Our engines are used in trucks of all sizes, buses and recreational vehicles, as well as in various industrial applications, including construction, agriculture, power generation systems and other off-highway applications. The Distribution segment includes wholly-owned and partially-owned distributorships engaged in wholesaling engines, generator sets and service parts, as well as performing service and repair activities on our products and maintaining relationships with various OEMs throughout the world. The Power Systems segment is an integrated power provider, which designs, manufactures and sells engines (16 liters and larger) for industrial applications (including mining, oil and gas, marine and rail), standby and prime power generator sets, alternators and other power components. The Accelera segment designs, manufactures, sells and supports hydrogen production technologies as well as electrified power systems with innovative components and subsystems, including battery, fuel cell and electric powertrain technologies. The Accelera segment is currently in the early stages of commercializing these technologies with efforts primarily focused on the development of our electrolyzers for hydrogen production and electrified power systems and related components and subsystems. We continue to serve all our markets as they adopt electrification and alternative power technologies, meeting the needs of our OEM partners and end customers.

Our financial performance depends, in large part, on varying conditions in the markets we serve, particularly the on-highway, off-highway, power generation and general industrial markets. Demand in these markets tends to fluctuate in response to overall economic conditions. Our sales may also be impacted by OEM inventory levels, production schedules, stoppages and supply chain challenges. Economic downturns in markets we serve generally result in reduced sales of our products and can result in price reductions in certain products and/or markets. As a worldwide business, our operations are also affected by geopolitical risks, currency fluctuations, political and economic uncertainty, public health crises (epidemics or pandemics) and regulatory matters, including adoption and enforcement of environmental and emission standards, in the countries we serve. As part of our growth strategy, we invest in businesses in certain countries that carry higher levels of these risks such as China, Brazil, India, Mexico and other countries in Europe, the Middle East and Africa. At the same time, our geographic diversity and broad product and service offerings have helped

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limit the impact from a drop in demand in any one industry, region, the economy of any single country or customer on our consolidated results.

Divestiture of Atmus

On March 18, 2024, we completed the divestiture of our remaining 80.5 percent ownership of Atmus Filtration Technologies Inc. (Atmus) common stock through a tax-free split-off. The exchange resulted in a reduction of shares of our common stock outstanding by 5.6 million shares. See NOTE 14, "ATMUS DIVESTITURE," to the Condensed Consolidated Financial Statements for additional information.

Settlement Agreements

In December 2023, we announced that we reached an agreement in principle with the U.S. Environmental Protection Agency (EPA), the California Air Resources Board (CARB), the Environmental and Natural Resources Division of the U.S. Department of Justice and the California Attorney General’s Office to resolve certain regulatory civil claims regarding our emissions certification and compliance process for certain engines primarily used in pick-up truck applications in the U.S., which became final and effective in April 2024 (collectively, the Settlement Agreements). See NOTE 11, “COMMITMENTS AND CONTINGENCIES,” to our Condensed Consolidated Financial Statements for additional information.

2024 First Quarter Results

A summary of our results is as follows:

	Three months ended
	March 31,
In millions, except per share amounts	2024		2023
Net sales	$	8,403	$	8,453
Net income attributable to Cummins Inc.	1,993		790
Earnings per common share attributable to Cummins Inc.
Basic	$	14.10	$	5.58
Diluted	14.03		5.55

Worldwide revenues decreased by 1 percent in the three months ended March 31, 2024, compared to the same period in 2023, due to lower demand in heavy-duty truck markets, which negatively impacted Components product demand, as well as weaker demand for construction engines and decreased sales due to the divestiture of Atmus, mostly offset by increased power generation demand. Net sales in the U.S. and Canada remained flat as lower demand in North American heavy-duty truck markets, which negatively impacted Components product demand, and lower demand in oil and gas markets in North America were offset by higher demand in power generation and medium-duty truck markets. International demand (excludes the U.S. and Canada) declined 1 percent, with lower sales in China, Europe, Africa and the Middle East, partially offset by higher sales in Latin America and India. The decrease in international sales was primarily due to lower demand in construction markets (especially in China and Western Europe) and weaker demand for emission solutions products (primarily in China and India), partially offset by higher demand across most Distribution product lines.

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The following table contains sales and EBITDA (defined as earnings or losses before interest expense, income taxes, depreciation and amortization and noncontrolling interests) by operating segment for the three months ended March 31, 2024 and 2023. See NOTE 15, "OPERATING SEGMENTS," to the Condensed Consolidated Financial Statements for additional information and a reconciliation of our segment information to the corresponding amounts in our Condensed Consolidated Statements of Net Income.

	Three months ended March 31,
Operating Segments	2024							2023							Percent change
			Percent							Percent					2024 vs. 2023
In millions	Sales		of Total		EBITDA			Sales		of Total		EBITDA			Sales		EBITDA
Components	$	3,332	40	%	$	473		$	3,557	42	%	$	507		(6)	%	(7)	%
Engine	2,928		35	%	414			2,986		36	%	457			(2)	%	(9)	%
Distribution	2,535		30	%	294			2,406		28	%	335			5	%	(12)	%
Power Systems	1,389		16	%	237			1,343		16	%	219			3	%	8	%
Accelera	93		1	%	(101)			85		1	%	(94)			9	%	(7)	%
Intersegment eliminations	(1,874)		(22)	%	1,255			(1,924)		(23)	%	(63)			(3)	%	NM
Total	$	8,403	100	%	$	2,572	(1)	$	8,453	100	%	$	1,361	(2)	(1)	%	89	%
"NM" - not meaningful information
(1) EBITDA included $1.3 billion of gain recognized on the divestiture of Atmus and $35 million of costs associated with the divestiture of Atmus for the three months ended March 31, 2024. See NOTE 14, "ATMUS DIVESTITURE," to the Condensed Consolidated Financial Statements for additional information.
(2) EBITDA included $18 million of costs associated with the divestiture of Atmus for the three months ended March 31, 2023.

Net income attributable to Cummins Inc. was $2.0 billion, or $14.03 per diluted share, on sales of $8.4 billion for the three months ended March 31, 2024, versus the comparable prior year period net income attributable to Cummins Inc. of $790 million, or $5.55 per diluted share, on sales of $8.5 billion. The increases in net income attributable to Cummins Inc. and earnings per diluted share were driven by the gain recognized on the divestiture of Atmus, partially offset by higher compensation and consulting expenses. The increase in gross margin was primarily due to favorable pricing, partially offset by higher compensation expenses and lower volumes. Diluted earnings per common share for the three months ended March 31, 2024, benefited $0.09 from fewer weighted-average shares outstanding due to treasury shares reacquired in the Atmus divestiture. See NOTE 14, "ATMUS DIVESTITURE," to the Condensed Consolidated Financial Statements for additional information.

We generated $276 million of cash from operations for the three months ended March 31, 2024, compared to $495 million for the comparable period in 2023. See the section titled "Cash Flows" in the "LIQUIDITY AND CAPITAL RESOURCES" section for a discussion of items impacting cash flows.

Our debt to capital ratio (total capital defined as debt plus equity) at March 31, 2024, was 40.4 percent, compared to 40.3 percent at December 31, 2023. The increase was primarily due to higher debt balances at March 31, 2024. At March 31, 2024, we had $3.1 billion in cash and marketable securities on hand and access to our $4.0 billion credit facilities (net of commercial paper outstanding), if necessary, to meet acquisition, working capital, investment and funding needs.

On February 20, 2024, we issued $2.25 billion aggregate principal amount of senior unsecured notes consisting of $500 million aggregate principal amount of 4.90 percent senior unsecured notes due in 2029, $750 million aggregate principal amount of 5.15 percent senior unsecured notes due in 2034 and $1.0 billion aggregate principal amount of 5.45 percent senior unsecured notes due in 2054. We received net proceeds of $2.2 billion. See NOTE 9, "DEBT," to the Condensed Consolidated Financial Statements for additional information.

In the first three months of 2024, the investment gain on our U.S. pension trusts was 1.2 percent, while our U.K. pension trusts' loss was 2.3 percent. We anticipate making additional defined benefit pension contributions during the remainder of 2024 of $29 million for our U.S. and U.K. qualified and non-qualified pension plans. We expect our 2024 annual net periodic pension cost to approximate $34 million.

As of the date of this filing, our credit ratings and outlooks from the credit rating agencies remain unchanged.

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RESULTS OF OPERATIONS

	Three months ended				Favorable/
	March 31,				(Unfavorable)
In millions, except per share amounts	2024		2023		Amount		Percent
NET SALES	$	8,403	$	8,453	$	(50)	(1)	%
Cost of sales	6,362		6,424		62		1	%
GROSS MARGIN	2,041		2,029		12		1	%
OPERATING EXPENSES AND INCOME
Selling, general and administrative expenses	839		753		(86)		(11)	%
Research, development and engineering expenses	369		350		(19)		(5)	%
Equity, royalty and interest income from investees	123		119		4		3	%
Other operating expense, net	33		19		(14)		(74)	%
OPERATING INCOME	923		1,026		(103)		(10)	%
Interest expense	89		87		(2)		(2)	%
Other income, net	1,387		90		1,297		NM
INCOME BEFORE INCOME TAXES	2,221		1,029		1,192		NM
Income tax expense	193		223		30		13	%
CONSOLIDATED NET INCOME	2,028		806		1,222		NM
Less: Net income attributable to noncontrolling interests	35		16		(19)		NM
NET INCOME ATTRIBUTABLE TO CUMMINS INC.	$	1,993	$	790	$	1,203	NM
Diluted Earnings Per Common Share Attributable to Cummins Inc.	$	14.03	$	5.55	$	8.48	NM
"NM" - not meaningful information

	Three months ended				Favorable/ (Unfavorable)
	March 31,
Percent of sales	2024		2023		Percentage Points
Gross margin	24.3	%	24.0	%	0.3
Selling, general and administrative expenses	10.0	%	8.9	%	(1.1)
Research, development and engineering expenses	4.4	%	4.1	%	(0.3)

Net Sales

Net sales for the three months ended March 31, 2024, decreased by $50 million versus the comparable period in 2023. The primary drivers were as follows:

•Components segment sales decreased 6 percent largely due to lower demand in our emission solutions and axles and brakes businesses and the divestiture of Atmus on March 18, 2024.

•Engine segment sales decreased 2 percent primarily due to lower demand in global construction markets and North American heavy-duty truck markets, partially offset by higher demand in North American medium-duty truck markets.

These decreases were partially offset by the following:

•Distribution segment sales increased 5 percent principally due to higher demand in power generation markets.

•Power Systems segment sales increased 3 percent primarily due to higher demand in power generation markets.

Sales to international markets (excluding the U.S. and Canada), based on location of customers, for the three months ended March 31, 2024, were 39 percent of total net sales compared with 39 percent of total net sales for the comparable period in 2023. A more detailed discussion of sales by segment is presented in the “OPERATING SEGMENT RESULTS” section.

Cost of Sales

The types of expenses included in cost of sales are the following: parts and material consumption, including direct and indirect materials; compensation and related expenses, including variable compensation, salaries and fringe benefits; depreciation on

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production equipment and facilities and amortization of technology intangibles; estimated costs of warranty programs and campaigns; production utilities; production-related purchasing; warehousing, including receiving and inspection; freight costs; engineering support costs; repairs and maintenance; production and warehousing facility property insurance and rent for production facilities and other production overhead.

Gross Margin

Gross margin increased $12 million for the three months ended March 31, 2024, and increased 0.3 points as a percentage of net sales versus the comparable period in 2023. The increase in gross margin and gross margin as a percentage of sales was primarily due to favorable pricing, partially offset by higher compensation expenses and lower volumes. Compensation and related expenses included salaries, fringe benefits and variable compensation.

The provision for base warranties issued as a percent of sales for the three months ended March 31, 2024, was 1.9 percent compared to 1.7 percent for the comparable period in 2023.

Selling, General and Administrative Expenses

Selling, general and administrative expenses increased $86 million for the three months ended March 31, 2024, versus the comparable period in 2023, primarily due to higher compensation and consulting expenses. Compensation and related expenses included salaries, fringe benefits and variable compensation. Overall, selling, general and administrative expenses as a percentage of net sales increased to 10.0 percent in the three months ended March 31, 2024, from 8.9 percent in the comparable period in 2023.

Research, Development and Engineering Expenses

Research, development and engineering expenses increased $19 million for the three months ended March 31, 2024, versus the comparable period in 2023, primarily due to higher compensation expenses. Compensation and related expenses included salaries, fringe benefits and variable compensation. Overall, research, development and engineering expenses as a percentage of net sales increased to 4.4 percent in the three months ended March 31, 2024, from 4.1 percent in the comparable period in 2023.

Research activities continue to focus on development of new products and improvements of current technologies to meet future emission standards around the world, improvements in fuel economy performance of diesel and natural gas-powered engines and related components, as well as development activities around hydrogen engine solutions, battery electric, fuel cell electric and hydrogen production technologies.

Equity, Royalty and Interest Income from Investees

Equity, royalty and interest income from investees increased $4 million for the three months ended March 31, 2024, versus the comparable period in 2023, primarily due to higher earnings at Chongqing Cummins Engine Co., Ltd., Dongfeng Cummins Engine Co., Ltd. and Sisamex, partially offset by lower royalty and interest income from investees.

Other Operating Expense, Net

Other operating (expense) income, net was as follows:

	Three months ended
	March 31,
In millions	2024		2023
Amortization of intangible assets	$	(32)	$	(32)
Other, net	(1)		13
Total other operating expense, net	$	(33)	$	(19)

Interest Expense

Interest expense was $89 million for the three months ended March 31, 2024, versus $87 million for the comparable period in 2023. Interest expense increased $2 million primarily due to the higher outstanding long-term borrowings related to the 2024 note issuance and higher weighted-average interest rates, partially offset by lower commercial paper and decreased average term loan borrowings outstanding.

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Other Income, Net

Other income (expense), net was as follows:

	Three months ended
	March 31,
In millions	2024		2023
Gain related to divestiture of Atmus (1)	$	1,333	$	—
Non-service pension and OPEB income	30		31
Interest income	29		18
Gain on marketable securities, net	4		5
Gain on corporate owned life insurance	2		19
Foreign currency (loss) gain, net	(11)		12
Other, net	—		5
Total other income, net	$	1,387	$	90
(1) See NOTE 14, "ATMUS DIVESTITURE," to our Condensed Consolidated Financial Statements for additional information.

Income Tax Expense

Our effective tax rate for 2024 is expected to approximate 24.0 percent, excluding any discrete items that may arise.

Our effective tax rates for the three months ended March 31, 2024 and 2023, were 8.7 percent and 21.7 percent, respectively.

The three months ended March 31, 2024, contained favorable discrete tax items primarily due to the $1.3 billion non-taxable gain on the Atmus split-off. Other discrete tax items were $21 million favorable primarily due to adjustments related to audit settlements.

The three months ended March 31, 2023, contained favorable discrete tax items of $3 million, primarily due to share-based compensation tax benefits.

Noncontrolling Interests

Noncontrolling interests eliminate the income or loss attributable to non-Cummins ownership interests in our consolidated entities. Noncontrolling interests in income of consolidated subsidiaries for the three months ended March 31, 2024, increased $19 million versus the comparable period in 2023 primarily due to higher earnings at Cummins India Limited and the absence of losses at Hydrogenics Corporation resulting from the June 2023 acquisition, partially offset by lower earnings at Eaton Cummins Joint Venture. The three months ended March 31, 2024, included the noncontrolling interest associated with Atmus through March 18, 2024, the date of divestiture.

Comprehensive Income - Foreign Currency Translation Adjustment

The foreign currency translation adjustment was a net loss of $60 million for the three months ended March 31, 2024, compared to a net gain of $82 million for the three months ended March 31, 2023, driven by the following:

	Three months ended
	March 31,
	2024			2023
In millions	Translation adjustment		Primary currency driver vs. U.S. dollar	Translation adjustment		Primary currency driver vs. U.S. dollar
Wholly-owned subsidiaries	$	(54)	Chinese renminbi, Euro	$	73	British pound, Brazilian real, Euro
Equity method investments	(3)		Chinese renminbi, partially offset by Indian rupee	6		Brazilian real, Chinese renminbi
Consolidated subsidiaries with a noncontrolling interest	(3)		Indian rupee, Chinese renminbi, Euro	3		Indian rupee
Total	$	(60)		$	82

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OPERATING SEGMENT RESULTS

Our reportable operating segments consist of the Components, Engine, Distribution, Power Systems and Accelera segments. This reporting structure is organized according to the products and markets each segment serves. We use segment EBITDA as the basis for the Chief Operating Decision Maker to evaluate the performance of each of our reportable operating segments. We believe EBITDA is a useful measure of our operating performance as it assists investors and debt holders in comparing our performance on a consistent basis without regard to financing methods, capital structure, income taxes or depreciation and amortization methods, which can vary significantly depending upon many factors. Segment amounts exclude certain expenses not specifically identifiable to segments. See NOTE 15, "OPERATING SEGMENTS," to the Condensed Consolidated Financial Statements for additional information and a reconciliation of our segment information to the corresponding amounts in our Condensed Consolidated Statements of Net Income.

Following is a discussion of results for each of our operating segments.

Components Segment Results

Financial data for the Components segment was as follows:

	Three months ended								Favorable/
	March 31,								(Unfavorable)
In millions	2024				2023				Amount		Percent
External sales	$	2,842			$	3,043			$	(201)	(7)	%
Intersegment sales	490				514				(24)		(5)	%
Total sales	3,332				3,557				(225)		(6)	%
Research, development and engineering expenses	84				91				7		8	%
Equity, royalty and interest income from investees	26				21				5		24	%
Interest income	8				6				2		33	%
Segment EBITDA	473			(1)	507			(2)	(34)		(7)	%
									Percentage Points
Segment EBITDA as a percentage of total sales	14.2		%		14.3		%				(0.1)
(1) Included $21 million of costs associated with the divestiture of Atmus for the three months ended March 31, 2024.
(2) Included $12 million of costs associated with the divestiture of Atmus for the three months ended March 31, 2023.

On March 18, 2024, we completed the divestiture of our remaining 80.5 percent ownership of Atmus common stock through a tax-free split-off. See NOTE 14, "ATMUS DIVESTITURE," to the Condensed Consolidated Financial Statements for additional information.

Sales for our Components segment by business were as follows:

	Three months ended					Favorable/
	March 31,					(Unfavorable)
In millions	2024			2023		Amount		Percent
Axles and brakes	$	1,232		$	1,272	$	(40)	(3)	%
Emission solutions	971			1,056		(85)		(8)	%
Engine components	544			581		(37)		(6)	%
Atmus	353		(1)	417		(64)		(15)	%
Automated transmissions	165			179		(14)		(8)	%
Software and electronics	67			52		15		29	%
Total sales	$	3,332		$	3,557	$	(225)	(6)	%
(1) Included sales through the March 18, 2024, divestiture. See NOTE 14, "ATMUS DIVESTITURE," to the Condensed Consolidated Financial Statements for additional information.

Sales

Components segment sales for the three months ended March 31, 2024, decreased $225 million versus the comparable period in 2023. The following were the primary drivers by business:

•Emission solutions sales decreased $85 million primarily due to weaker demand in China and India.

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•Atmus sales decreased $64 million due to the divestiture on March 18, 2024.

•Axles and brakes sales decreased $40 million mainly due to weaker demand in North America and Western Europe, partially offset by stronger demand in Brazil.

Segment EBITDA

Components segment EBITDA for the three months ended March 31, 2024, decreased $34 million versus the comparable period in 2023, mainly due to lower volumes (including the divestiture of Atmus) and higher compensation expenses, partially offset by lower material costs and favorable mix.

Engine Segment Results

Financial data for the Engine segment was as follows:

	Three months ended						Favorable/
	March 31,						(Unfavorable)
In millions	2024			2023			Amount		Percent
External sales	$	2,240		$	2,252		$	(12)	(1)	%
Intersegment sales	688			734			(46)		(6)	%
Total sales	2,928			2,986			(58)		(2)	%
Research, development and engineering expenses	154			134			(20)		(15)	%
Equity, royalty and interest income from investees	57			65			(8)		(12)	%
Interest income	7			3			4		NM
Segment EBITDA	414			457			(43)		(9)	%
							Percentage Points
Segment EBITDA as a percentage of total sales	14.1		%	15.3		%			(1.2)
"NM" - not meaningful information

Sales for our Engine segment by market were as follows:

	Three months ended						Favorable/
	March 31,						(Unfavorable)
In millions	2024			2023			Amount		Percent
Heavy-duty truck	$	1,059		$	1,114		$	(55)	(5)	%
Medium-duty truck and bus	995			903			92		10	%
Light-duty automotive	438			439			(1)		—	%
Total on-highway	2,492			2,456			36		1	%
Off-highway	436			530			(94)		(18)	%
Total sales	$	2,928		$	2,986		$	(58)	(2)	%
							Percentage Points
On-highway sales as percentage of total sales	85		%	82		%			3

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Unit shipments by engine classification (including unit shipments to Power Systems and off-highway engine units included in their respective classification) were as follows:

	Three months ended		Favorable/
	March 31,		(Unfavorable)
	2024	2023	Amount	Percent
Heavy-duty	33,600	34,700	(1,100)	(3)	%
Medium-duty	75,800	78,900	(3,100)	(4)	%
Light-duty	54,800	55,000	(200)	—	%
Total unit shipments	164,200	168,600	(4,400)	(3)	%

Sales

Engine segment sales for the three months ended March 31, 2024, decreased $58 million versus the comparable period in 2023. The following were the primary drivers by market:

•Off-highway sales decreased $94 million mainly due to lower demand in global construction markets, especially in China and Western Europe.

•Heavy-duty truck sales decreased $55 million principally due to weaker demand in North America.

These decreases were partially offset by increased medium-duty truck and bus sales of $92 million mainly due to higher demand in North America with higher medium-duty truck shipments of 20 percent.

Segment EBITDA

Engine segment EBITDA for the three months ended March 31, 2024, decreased $43 million versus the comparable period in 2023, primarily due to lower volumes, higher compensation expenses and unfavorable product coverage costs, partially offset by favorable pricing.

Distribution Segment Results

Financial data for the Distribution segment was as follows:

	Three months ended						Favorable/
	March 31,						(Unfavorable)
In millions	2024			2023			Amount		Percent
External sales	$	2,529		$	2,399		$	130	5	%
Intersegment sales	6			7			(1)		(14)	%
Total sales	2,535			2,406			129		5	%
Research, development and engineering expenses	14			14			—		—	%
Equity, royalty and interest income from investees	24			24			—		—	%
Interest income	11			7			4		57	%
Segment EBITDA	294			335			(41)		(12)	%
							Percentage Points
Segment EBITDA as a percentage of total sales	11.6		%	13.9		%			(2.3)

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Sales for our Distribution segment by region were as follows:

	Three months ended				Favorable/
	March 31,				(Unfavorable)
In millions	2024		2023		Amount		Percent
North America	$	1,723	$	1,695	$	28	2	%
Asia Pacific	285		240		45		19	%
Europe	240		195		45		23	%
China	102		102		—		—	%
India	71		59		12		20	%
Latin America	60		53		7		13	%
Africa and Middle East	54		62		(8)		(13)	%
Total sales	$	2,535	$	2,406	$	129	5	%

Sales for our Distribution segment by product line were as follows:

	Three months ended				Favorable/
	March 31,				(Unfavorable)
In millions	2024		2023		Amount		Percent
Parts	$	1,001	$	1,057	$	(56)	(5)	%
Power generation	707		492		215		44	%
Engines	421		456		(35)		(8)	%
Service	406		401		5		1	%
Total sales	$	2,535	$	2,406	$	129	5	%

Sales

Distribution segment sales for the three months ended March 31, 2024, increased $129 million versus the comparable period in 2023. The following were the primary drivers by region:

•Asia Pacific sales increased $45 million primarily due to higher demand in power generation, especially data center markets, and service.

•European sales increased $45 million mainly due to favorable demand in power generation and parts.

•North American sales increased $28 million principally due to higher demand in power generation, especially commercial and data center markets, partially offset by lower demand for engines and aftermarket products.

Segment EBITDA

Distribution segment EBITDA for the three months ended March 31, 2024, decreased $41 million versus the comparable period in 2023, primarily due to higher compensation expenses, unfavorable inventory adjustments and unfavorable mix, partially offset by favorable pricing.

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Power Systems Segment Results

Financial data for the Power Systems segment was as follows:

	Three months ended						Favorable/
	March 31,						(Unfavorable)
In millions	2024			2023			Amount		Percent
External sales	$	708		$	679		$	29	4	%
Intersegment sales	681			664			17		3	%
Total sales	1,389			1,343			46		3	%
Research, development and engineering expenses	60			63			3		5	%
Equity, royalty and interest income from investees	19			13			6		46	%
Interest income	3			2			1		50	%
Segment EBITDA	237			219			18		8	%
							Percentage Points
Segment EBITDA as a percentage of total sales	17.1		%	16.3		%			0.8

Sales for our Power Systems segment by product line were as follows:

	Three months ended				Favorable/
	March 31,				(Unfavorable)
In millions	2024		2023		Amount		Percent
Power generation	$	853	$	770	$	83	11	%
Industrial	420		455		(35)		(8)	%
Generator technologies	116		118		(2)		(2)	%
Total sales	$	1,389	$	1,343	$	46	3	%

Sales

Power Systems segment sales for the three months ended March 31, 2024, increased $46 million versus the comparable period in 2023. The primary driver was an increase in power generation sales of $83 million mainly due to higher demand in North America and India, partially offset by weaker demand in Western Europe and Latin America. The increase was partially offset by a decrease in industrial sales of $35 million mainly due to weaker demand in the oil and gas market in North America, partially offset by stronger demand in global mining markets.

Segment EBITDA

Power Systems segment EBITDA for the three months ended March 31, 2024, increased $18 million versus the comparable period in 2023, mainly due to favorable pricing, partially offset by unfavorable mix and higher compensation expenses.

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Accelera Segment Results

Financial data for the Accelera segment was as follows:

	Three months ended				Favorable/
	March 31,				(Unfavorable)
In millions	2024		2023		Amount		Percent
External sales	$	84	$	80	$	4	5	%
Intersegment sales	9		5		4		80	%
Total sales	93		85		8		9	%
Research, development and engineering expenses	55		48		(7)		(15)	%
Equity, royalty and interest loss from investees	(3)		(4)		1		25	%
Segment EBITDA	(101)		(94)		(7)		(7)	%

Accelera segment sales for the three months ended March 31, 2024, increased $8 million versus the comparable period in 2023 principally due to improved sales of electrolyzers.

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OUTLOOK

Our outlook reflects the following positive trends and challenges to our business that could impact our revenue and earnings potential for the remainder of 2024.

Positive Trends

•We expect demand for medium-duty trucks in North America to remain strong.

•We believe market demand for trucks in India will continue to be strong.

•We expect demand within our Power Systems business to remain strong, including the power generation and mining markets.

•We anticipate demand in our aftermarket business will continue to be robust, driven primarily by strong demand in our Engine and Power Systems businesses.

•We expect demand for trucks in China to remain stable or improve in 2024.

Challenges

•We expect demand for heavy-duty trucks in North America to weaken modestly, particularly in the second half of 2024.

•Continued increases in material and labor costs, as well as other inflationary pressures, could negatively impact earnings.

•The financial implications resulting from our Settlement Agreements will negatively impact our liquidity in 2024 and will result in incremental interest expense for debt utilized in funding the civil penalty.

LIQUIDITY AND CAPITAL RESOURCES

Key Working Capital and Balance Sheet Data

We fund our working capital with cash from operations and short-term borrowings, including commercial paper, when necessary. Various assets and liabilities, including short-term debt, can fluctuate significantly from month to month depending on short-term liquidity needs. As a result, working capital is a prime focus of management's attention. Working capital and balance sheet measures are provided in the following table:

Dollars in millions	March 31, 2024			December 31, 2023
Working capital (1)	$	3,934		$	2,295
Current ratio	1.34			1.18
Accounts and notes receivable, net	$	5,463		$	5,583
Days' sales in receivables	60			58
Inventories	$	5,758		$	5,677
Inventory turnover	4.3			4.5
Accounts payable (principally trade)	$	4,476		$	4,260
Days' payable outstanding	64			62
Total debt	$	6,835		$	6,696
Total debt as a percent of total capital	40.4		%	40.3		%
(1) Working capital included cash and cash equivalents

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Cash Flows

Cash and cash equivalents were impacted as follows:

	Three months ended
	March 31,
In millions	2024		2023		Change
Net cash provided by operating activities	$	276	$	495	$	(219)
Net cash used in investing activities	(406)		(228)		(178)
Net cash provided by (used in) financing activities	499		(363)		862
Effect of exchange rate changes on cash and cash equivalents	(7)		(25)		18
Net increase (decrease) in cash and cash equivalents	$	362	$	(121)	$	483

Net cash provided by operating activities decreased $219 million for the three months ended March 31, 2024, versus the comparable period in 2023, primarily due to higher working capital requirements of $112 million and lower operating income of $103 million. The higher working capital requirements resulted in a cash outflow of $606 million compared to a cash outflow of $494 million in the comparable period of 2023, mainly due to higher variable compensation payouts in accrued expenses, increased inventories and unfavorable changes in accounts payable, partially offset by favorable changes in accounts and notes receivable.

Net cash used in investing activities increased $178 million for the three months ended March 31, 2024, versus the comparable period in 2023, primarily due to cash associated with the Atmus divestiture of $174 million and higher acquisition activity of $59 million, partially offset by higher net liquidations of marketable securities of $33 million and lower capital expenditures of $24 million.

Net cash provided by financing activities increased $862 million for the three months ended March 31, 2024, versus the comparable period in 2023, primarily due to proceeds from borrowings of $2.4 billion (principally related to our 2024 note issuance), partially offset by higher net payments of commercial paper of $858 million and payments on borrowings and finance lease obligations of $606 million.

The effect of exchange rate changes on cash and cash equivalents for the three months ended March 31, 2024, versus the comparable period in 2023, increased $18 million primarily due to unfavorable fluctuations in the British pound, partially offset by the Chinese renminbi.

Sources of Liquidity

We generate significant ongoing cash flow. Cash provided by operations is our principal source of liquidity with $276 million generated in the three months ended March 31, 2024. Our sources of liquidity include:

	March 31, 2024
In millions	Total		U.S.		International		Primary location of international balances
Cash and cash equivalents	$	2,541	$	1,617	$	924	Singapore, Australia, Belgium, Mexico, Canada, China
Marketable securities (1)	510		85		425		India
Total	$	3,051	$	1,702	$	1,349
Available credit capacity
Revolving credit facilities (2)	$	3,391
International and other uncommitted domestic credit facilities	$	396
(1) The majority of marketable securities could be liquidated into cash within a few days.
(2) The five-year credit facility for $2.0 billion and the 364-day credit facility for $2.0 billion, maturing August 2026 and June 2024, respectively, are maintained primarily to provide backup liquidity for our commercial paper borrowings and general corporate purposes. At March 31, 2024, we had $609 million of commercial paper outstanding, which effectively reduced our available capacity under our revolving credit facilities to $3.4 billion.

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Cash, Cash Equivalents and Marketable Securities

A significant portion of our cash flow is generated outside the U.S. We manage our worldwide cash requirements considering available funds among the many subsidiaries through which we conduct our business and the cost effectiveness with which those funds can be accessed. As a result, we do not anticipate any local liquidity restrictions to preclude us from funding our operating needs with local resources.

If we distribute our foreign cash balances to the U.S. or to other foreign subsidiaries, we could be required to accrue and pay withholding taxes, for example, if we repatriated cash from certain foreign subsidiaries whose earnings we asserted are completely or partially permanently reinvested. Foreign earnings for which we assert permanent reinvestment outside the U.S. consist primarily of earnings of our China, India, Canada (including underlying subsidiaries) and Netherlands domiciled subsidiaries. At present, we do not foresee a need to repatriate any earnings for which we assert permanent reinvestment. However, to help fund cash needs of the U.S. or other international subsidiaries as they arise, we repatriate available cash from certain foreign subsidiaries whose earnings are not permanently reinvested when it is cost effective to do so.

Debt Facilities and Other Sources of Liquidity

In April 2024, we issued approximately $1.0 billion of commercial paper in anticipation of paying the substantial majority of payments required by the Settlement Agreements in May 2024. See NOTE 11, “COMMITMENTS AND CONTINGENCIES,” to the Condensed Consolidated Financial Statements for additional information on the Settlement Agreements.

On February 20, 2024, we issued $2.25 billion aggregate principal amount of senior unsecured notes consisting of $500 million aggregate principal amount of 4.90 percent senior unsecured notes due in 2029, $750 million aggregate principal amount of 5.15 percent senior unsecured notes due in 2034 and $1.0 billion aggregate principal amount of 5.45 percent senior unsecured notes due in 2054. We received net proceeds of $2.2 billion. See NOTE 9, "DEBT," to the Condensed Consolidated Financial Statements for additional information.

Our committed credit facilities provide access up to $4.0 billion, including our $2.0 billion 364-day facility that expires June 3, 2024, and our $2.0 billion five-year facility that expires on August 18, 2026. These revolving credit facilities are maintained primarily to provide backup liquidity for our commercial paper borrowings and general corporate purposes. We intend to maintain credit facilities at the current or higher aggregate amounts by renewing or replacing these facilities at or before expiration. There were no outstanding borrowings under these facilities at March 31, 2024.

Our committed credit facilities provide access up to $4.0 billion of unsecured, short-term promissory notes (commercial paper) pursuant to the Board of Directors (the Board) authorized commercial paper programs. These programs facilitate the private placement of unsecured short-term debt through third-party brokers. We intend to use the net proceeds from the commercial paper borrowings for general corporate purposes. The total combined borrowing capacity under the revolving credit facilities and commercial paper programs should not exceed $4.0 billion. At March 31, 2024, we had $609 million of commercial paper outstanding, which effectively reduced our available capacity under our revolving credit facilities to $3.4 billion. See NOTE 9, "DEBT," to the Condensed Consolidated Financial Statements for additional information.

As a well-known seasoned issuer, we filed an automatic shelf registration of an undetermined amount of debt and equity with the Securities and Exchange Commission (SEC) on February 8, 2022. Under this shelf registration we may offer, from time to time, debt securities, common stock, preferred and preference stock, depositary shares, warrants, stock purchase contracts and stock purchase units.

Supply Chain Financing

We currently have supply chain financing programs with financial intermediaries, which provide certain vendors the option to be paid by financial intermediaries earlier than the due date on the applicable invoice. When a vendor utilizes the program and receives an early payment from a financial intermediary, they take a discount on the invoice. We then pay the financial intermediary the face amount of the invoice on the original due date, which generally have 60 to 90 day payment terms. The maximum amount that we could have outstanding under the program was $512 million. We do not reimburse vendors for any costs they incur for participation in the program, their participation is completely voluntary and there are no assets pledged as security or other forms of guarantees provided for the committed payment to the finance provider or intermediary. As a result, all amounts owed to the financial intermediaries are presented as accounts payable in our Condensed Consolidated Balance Sheets. Amounts due to the financial intermediaries reflected in accounts payable at March 31, 2024, were $193 million.

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Uses of Cash

Settlement Agreements

In December 2023, we announced that we reached an agreement in principle with the EPA, CARB, the Environmental and Natural Resources Division of the U.S. Department of Justice and the California Attorney General’s Office to resolve certain regulatory civil claims regarding our emissions certification and compliance process for certain engines primarily used in pick-up truck applications in the U.S., which became final and effective in April 2024 (collectively, the Settlement Agreements). As part of the Settlement Agreements, among other things, we agreed to pay civil penalties, complete recall requirements, undertake mitigation projects, provide extended warranties, undertake certain testing, take certain corporate compliance measures and make certain payments. Failure to comply with the terms and conditions of the Settlement Agreements will subject us to stipulated penalties. We recorded a charge of $2.0 billion in the fourth quarter of 2023 to resolve the matters addressed by the Settlement Agreements involving approximately one million of our pick-up truck applications in the U.S. This charge was in addition to the previously announced charges of $59 million for the recalls of model years 2013 through 2018 RAM 2500 and 3500 trucks and model years 2016 through 2019 Titan trucks. Of this amount, $1.9 billion relates to payments that we began making in April 2024; however, the majority of these payments are expected to be made in May 2024. See NOTE 11, "COMMITMENTS AND CONTINGENCIES," to the Condensed Consolidated Financial Statements for additional information.

Repayment of Debt

We used a portion of the net proceeds of $2.2 billion from our February 2024 bond issuance to pay down $650 million of our term loan, due 2025, and commercial paper. We intend to use the remaining net proceeds for general corporate purposes.

In April 2024, we also repaid $100 million of our term loan, due 2025.

Dividends

We paid dividends of $239 million during the three months ended March 31, 2024.

Capital Expenditures

Capital expenditures for the three months ended March 31, 2024, were $169 million versus $193 million in the comparable period in 2023. We continue to invest in new product lines and targeted capacity expansions. We plan to spend an estimated $1.2 billion to $1.3 billion in 2024 on capital expenditures with over 65 percent of these expenditures expected to be invested in North America.

Current Maturities of Short and Long-Term Debt

We had $609 million of commercial paper outstanding at March 31, 2024, that matures in less than one year. The maturity schedule of our existing long-term debt requires significant cash outflows in 2025 when our term loan and 0.75 percent senior notes are due. Required annual long-term debt principal payments range from $41 million to $1.1 billion over the next five years (including the remainder of 2024). We intend to retain our strong investment credit ratings. See NOTE 9, "DEBT," to the Condensed Consolidated Financial Statements for additional information.

Pensions

Our global pension plans, including our unfunded and non-qualified plans, were 113 percent funded at December 31, 2023. Our U.S. defined benefit plans (qualified and non-qualified), which represented approximately 69 percent of the worldwide pension obligation, were 113 percent funded, and our U.K. defined benefit plans were 113 percent funded at December 31, 2023. The funded status of our pension plans is dependent upon a variety of variables and assumptions including return on invested assets, market interest rates and levels of voluntary contributions to the plans. In the first three months of 2024, the investment gain on our U.S. pension trusts was 1.2 percent, while our U.K. pension trusts' loss was 2.3 percent. We anticipate making additional defined benefit pension contributions during the remainder of 2024 of $29 million for our U.S. and U.K. qualified and non-qualified pension plans. These contributions may be made from trusts or company funds either to increase pension assets or to make direct benefit payments to plan participants. We expect our 2024 annual net periodic pension cost to approximate $34 million.

Stock Repurchases

In December 2021, the Board authorized the acquisition of up to $2.0 billion of additional common stock upon completion of the $2.0 billion repurchase plan authorized in 2019. We did not make any repurchases of common stock in the first three months of 2024. The dollar value remaining available for future purchases under the 2019 program at March 31, 2024, was $218 million.

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Credit Ratings

Our rating and outlook from each of the credit rating agencies as of the date of filing are shown in the table below:

	Long-Term	Short-Term
Credit Rating Agency (1)	Senior Debt Rating	Debt Rating	Outlook
Standard and Poor’s Rating Services	A	A1	Stable
Moody’s Investors Service, Inc.	A2	P1	Stable
(1) Credit ratings are not recommendations to buy, are subject to change, and each rating should be evaluated independently of any other rating. In addition, we undertake no obligation to update disclosures concerning our credit ratings, whether as a result of new information, future events or otherwise.

Management's Assessment of Liquidity

Our financial condition and liquidity remain strong. Our solid balance sheet and credit ratings enable us to have ready access to credit and the capital markets. We assess our liquidity in terms of our ability to generate adequate cash to fund our operating, investing and financing activities. We believe our access to capital markets, our existing cash and marketable securities, operating cash flow and revolving credit facilities provide us with the financial flexibility needed to make payments required by the Settlement Agreements, targeted capital expenditures, dividend payments, debt service obligations, projected pension obligations, common stock repurchases and fund acquisitions through 2024 and beyond. We continue to generate significant cash from operations and maintain access to our revolving credit facilities and commercial paper programs as noted above.

We anticipate making the substantial majority of payments required by the Settlement Agreements in May 2024 through the use of our existing liquidity and access to cash from commercial paper issued in April. See NOTE 17, "SUBSEQUENT EVENTS," to the Condensed Consolidated Financial Statements for additional information.

APPLICATION OF CRITICAL ACCOUNTING ESTIMATES

A summary of our significant accounting policies is included in NOTE 1, “SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES,” of the Notes to the Consolidated Financial Statements of our 2023 Form 10-K, which discusses accounting policies that we have selected from acceptable alternatives.

Our Condensed Consolidated Financial Statements are prepared in accordance with generally accepted accounting principles that often require management to make judgments, estimates and assumptions regarding uncertainties that affect the reported amounts presented and disclosed in the financial statements. Management reviews these estimates and assumptions based on historical experience, changes in business conditions and other relevant factors they believe to be reasonable under the circumstances. In any given reporting period, our actual results may differ from the estimates and assumptions used in preparing our Condensed Consolidated Financial Statements.

Critical accounting estimates are defined as follows: the estimate requires management to make assumptions about matters that were highly uncertain at the time the estimate was made; different estimates reasonably could have been used; or if changes in the estimate are reasonably likely to occur from period to period and the change would have a material impact on our financial condition or results of operations. Our senior management has discussed the development and selection of our accounting policies, related accounting estimates and the disclosures set forth below with the Audit Committee of the Board. Our critical accounting estimates disclosed in the Form 10-K address estimating liabilities for warranty programs, fair value of intangible assets, assessing goodwill impairment, accounting for income taxes and pension benefits.

A discussion of our critical accounting estimates may be found in the “Management’s Discussion and Analysis” section of our 2023 Form 10-K under the caption “APPLICATION OF CRITICAL ACCOUNTING ESTIMATES.” Within the context of these critical accounting estimates, we are not currently aware of any reasonably likely events or circumstances that would result in different policies or estimates being reported in the first three months of 2024.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

See NOTE 16, "RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS," in the Notes to Condensed Consolidated Financial Statements for additional information.

ITEM 3.  Quantitative and Qualitative Disclosures About Market Risk

A discussion of quantitative and qualitative disclosures about market risk may be found in Item 7A of our 2023 Form 10-K. There have been no material changes in this information since the filing of our 2023 Form 10-K. 

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ITEM 4.  Controls and Procedures

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this Quarterly Report on Form 10-Q, we carried out an evaluation under the supervision and with the participation of our management, including our Chief Executive Officer (CEO) and Chief Financial Officer (CFO), of the effectiveness of the design and operation of our disclosure controls and procedures as defined in Exchange Act Rules 13a-15(e) and 15d-15(e). Based upon that evaluation, our CEO and our CFO concluded that our disclosure controls and procedures were effective to ensure that the information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934 is (1) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and (2) accumulated and communicated to management, including our CEO and CFO, to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the quarter ended March 31, 2024, that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II.  OTHER INFORMATION

ITEM 1.  Legal Proceedings

The matters described under "Legal Proceedings" in NOTE 11, "COMMITMENTS AND CONTINGENCIES," to the Condensed Consolidated Financial Statements are incorporated herein by reference.

ITEM 1A.  Risk Factors

In addition to other information set forth in this report and the risk factor noted below, you should consider other risk factors discussed in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2023, which could materially affect our business, financial condition or future results. Other than noted below, there have been no material changes to our risks described in our 2023 Annual Report on Form 10-K or the "CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING INFORMATION" in this Quarterly report. Additional risks and uncertainties not currently known to us or that we currently judge to be immaterial also may materially adversely affect our business, financial condition or operating results.

GOVERNMENT REGULATION

While we have reached Settlement Agreements with the EPA, CARB, the Environmental and Natural Resources Division of the U.S. Department of Justice and the California Attorney General's Office to resolve certain regulatory civil claims regarding our emissions certification and compliance process for certain engines primarily used in pick-up truck applications in the U.S., we have incurred, and likely will incur, other additional claims, costs and expenses in connection with the matters covered by the Settlement Agreements and other matters related to our compliance with emission standards for our engines, including with respect to additional regulatory action and collateral litigation related to these matters. Those and related expenses and reputational damage could have a material adverse impact on our results of operations, financial condition and cash flows.

In December 2023, we announced that we reached the agreement in principle and recorded a charge of $2.0 billion in the fourth quarter of 2023 to resolve certain regulatory civil claims regarding our emissions certification and compliance process for certain engines primarily used in pick-up truck applications in the U.S., which became final and effective in April 2024. This fourth quarter of 2023 charge was in addition to the previously announced charges of $59 million for the recalls of model years 2013 through 2018 RAM 2500 and 3500 trucks and model years 2016 through 2019 Titan trucks. Failure to comply with the terms and conditions of the Settlement Agreements will also subject us to stipulated penalties.

We have also been in communication with other non-U.S. regulators regarding matters related to the emission systems in our engines and may also become subject to additional regulatory review in connection with these matters.

In connection with our announcement of our entry into the agreement in principle, we became subject to shareholder, consumer and third-party litigation regarding the matters covered by the Settlement Agreements, and we may become subject to additional litigation in connection with these matters.

The consequences resulting from the resolution of the foregoing matters are uncertain and the related expenses and reputational damage could have a material adverse impact on our results of operations, financial condition and cash flows. See NOTE 11, “COMMITMENTS AND CONTINGENCIES,” to the Condensed Consolidated Financial Statements for additional information.

45

ITEM 2.  Unregistered Sales of Equity Securities and Use of Proceeds

The following information is provided pursuant to Item 703 of Regulation S-K:

	Issuer Purchases of Equity Securities
Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (in millions) (1)
January 1 - January 31	—	$	—	—	$	2,218
February 1 - February 29	—	—		—	2,218
March 1 - March 31	—	—		—	2,218
Total	—	—		—
(1) Shares repurchased under our Key Employee Stock Investment Plan only occur in the event of a participant default, which cannot be predicted, and were excluded from this column.

In December 2021, the Board authorized the acquisition of up to $2.0 billion of additional common stock upon completion of the $2.0 billion repurchase plan authorized in 2019. During the three months ended March 31, 2024, we did not make any repurchases of common stock. The dollar value remaining available for future purchases under the 2019 program at March 31, 2024, was $218 million.

Our Key Employee Stock Investment Plan allows certain employees, other than officers, to purchase shares of common stock on an installment basis up to an established credit limit. We hold participants’ shares as security for the loans and would, in effect, repurchase shares only if the participant defaulted in repayment of the loan. Shares associated with participants' sales are sold as open-market transactions via a third-party broker.

ITEM 3.  Defaults Upon Senior Securities

Not applicable. 

ITEM 4.  Mine Safety Disclosures

Not applicable. 

ITEM 5.  Other Information

(c) During the first quarter of 2024, none of our directors or executive officers adopted or terminated any “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement” (as each term is defined in Item 408(a) of Regulation S-K).

46

ITEM 6. Exhibits

The exhibits listed in the following Exhibit Index are filed as part of this Quarterly Report on Form 10-Q.

CUMMINS INC.

EXHIBIT INDEX

Exhibit No.	Description of Exhibit
4.1	Sixth Supplemental Indenture, dated as of February 20, 2024, between Cummins Inc. and U.S. Bank National Association (incorporated by reference to Exhibit 4.2 to the Current Report on Form 8-K filed by Cummins Inc. with the Securities and Exchange Commission on February 20, 2024 (File No. 001-04949)).
4.2	Seventh Supplemental Indenture, dated as of February 20, 2024, between Cummins Inc. and U.S. Bank National Association (incorporated by reference to Exhibit 4.3 to the Current Report on Form 8-K filed by Cummins Inc. with the Securities and Exchange Commission on February 20, 2024 (File No. 001-04949)).
4.3	Eighth Supplemental Indenture, dated as of February 20, 2024, between Cummins Inc. and U.S. Bank National Association (incorporated by reference to Exhibit 4.4 to the Current Report on Form 8-K filed by Cummins Inc. with the Securities and Exchange Commission on February 20, 2024 (File No. 001-04949)).
10	Form of Performance-Based Restricted Stock Unit Award Agreement under 2012 Omnibus Incentive Plan (filed herewith).
31(a)	Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31(b)	Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32	Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*	Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH*	Inline XBRL Taxonomy Extension Schema Document.
101.CAL*	Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF*	Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB*	Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE*	Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

* Filed with this quarterly report on Form 10-Q are the following documents formatted in iXBRL (Inline Extensible Business Reporting Language): (i) the Condensed Consolidated Statements of Net Income for the three months ended March 31, 2024 and 2023, (ii) the Condensed Consolidated Statements of Comprehensive Income for the three months ended March 31, 2024 and 2023, (iii) the Condensed Consolidated Balance Sheets at March 31, 2024 and December 31, 2023, (iv) the Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2024 and 2023, (v) the Condensed Consolidated Statements of Changes in Redeemable Noncontrolling Interests and Equity for the three months ended March 31, 2024 and 2023, (vi) Notes to Condensed Consolidated Financial Statements and (vii) the information included in Part II. Item 5(c).

47

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Cummins Inc.
Date:	May 2, 2024
	By:	/s/ MARK A. SMITH	By:	/s/ LUTHER E. PETERS
		Mark A. Smith		Luther E. Peters
		Vice President and Chief Financial Officer		Vice President-Controller
		(Principal Financial Officer)		(Principal Accounting Officer)

48

EX-10

EXHIBIT 10

CUMMINS INC.

PERFORMANCE-BASED RESTRICTED STOCK UNIT AWARD AGREEMENT

THIS AGREEMENT (this “Agreement”), which relates to a grant of performance-based Restricted Stock Units (“RSUs”) made on _____________ (the “Date of Grant”), is between Cummins Inc. (the “Company”), and the individual whose name is set forth on the signature page hereof (the “Participant”):

RECITALS:

WHEREAS, the Company has adopted the Cummins Inc. 2012 Omnibus Incentive Plan (the “Plan”), which is incorporated herein by reference and made a part of this Agreement (capitalized terms not otherwise defined herein shall have the same meanings as in the Plan); and

WHEREAS, the Committee has determined that it would be in the best interests of the Company and its shareholders to grant the RSUs provided for herein to the Participant pursuant to the Plan, and the terms set forth herein.

NOW THEREFORE, in consideration of the mutual covenants hereinafter set forth, the parties agree as follows:

1.    Grant. The Company hereby grants to the Participant the number of RSUs set forth in the grant letter accompanying this Agreement (the “Grant Letter”) on the terms and conditions set forth in this Agreement. [One hundred percent (100%) of such RSUs are referred to as the “Target RSUs.”] The Participant’s rights with respect to the RSUs will remain forfeitable at all times prior to the date such RSUs vest as described in Section 4.

2.    Performance Period and Goals. The vesting of the RSUs is subject to the achievement of the performance goals (the “Performance Goals”) indicated in the Grant Letter during the performance period indicated in the Grant Letter (the “Performance Period”), as well as on continuous employment by the Participant until the Vesting Date (as defined below).

3.    Restrictions on Transfer. The Participant cannot sell, transfer, or dispose of or pledge or hypothecate or assign the unvested RSUs or the Shares underlying the vested RSUs prior to the date on which such vested RSUs are settled pursuant to Section 4 (collectively, the “Transfer Restrictions”).

4.    Vesting; Termination of Employment.

(a)    Vesting. Except as set forth in subsection (c), the RSUs will be eligible to vest only if the Participant continues in employment with the Company or its Affiliate until _________ (the “Vesting Date”). If the Participant’s employment with the Company and its Affiliates terminates for any reason prior to the Vesting Date, then[, except as set forth in subsection (c),] the RSUs shall be forfeited on the date of such termination without consideration therefor.

Page 1 of 4

4885-8514-4755.2

(b)    Determination of Performance. As soon as practicable after the end of the Performance Period [INSERT DESCRIPTION OF PROCESS FOR PERFORMANCE DETERMINATION].

(c)    [Death or Disability; Certain Involuntary Terminations Without Cause. Notwithstanding anything to the contrary in this Agreement, (i) if the Participant’s employment terminates prior to the Vesting Date due to death or Disability, then the Participant shall immediately and automatically vest in [____] of the Target RSUs [(regardless of the achievement of the Performance Goals)], and the remaining unvested portion of the RSUs shall be forfeited without consideration therefor and (ii) if (A) the Participant’s employment terminates prior to the Vesting Date as a result of an involuntary termination by the Company without Cause and (B) the Committee determines in its sole and absolute discretion that the Performance Goals have been achieved at a satisfactory level, then a number of the then-unvested RSUs determined by the Committee shall be deemed to have been earned and vested as of the date of such determination.]

5.    Settlement.

(a)    General. Except as otherwise provided in Section 5(b), as soon as practicable after the RSUs vest (but in all events during the year immediately following the end of the applicable Performance Period), the Company will settle such vested RSUs by making an appropriate book entry in the Participant’s name for a number of Shares equal to the number of RSUs that have vested. The Transfer Restrictions applicable to any Shares issued in respect of the RSUs shall lapse upon such issuance.

(b)    Restrictions. The Company shall not be liable to the Participant for damages relating to any delays in making an appropriate book entry, or any mistakes or errors in the making of the book entry, provided that the Company shall correct any such errors caused by it. Any such book entry shall be subject to such stop transfer orders and other restrictions as the Committee may deem advisable under the Plan or the rules, regulations, and other requirements of the Securities and Exchange Commission, any stock exchange upon which such Shares are listed, and any applicable Federal or state laws, and the Company may make an appropriate book entry notation to make appropriate reference to such restrictions.

6.    No Shareholder Rights. The Participant shall not have any voting, dividend or other shareholder rights with respect to the Shares underlying the RSUs.

7.    No Right to Continued Employment or Future Awards. The granting of the RSUs shall impose no obligation on the Company or any of its Affiliates to continue the employment of the Participant and shall not lessen or affect the Company’s or its Affiliate’s right to terminate the employment of the Participant. In addition, the granting of the RSUs shall impose no obligation on the Company or any of its Affiliates to make awards under the Plan to the Participant in the future.

2

4885-8514-4755.2

8.    Taxes. The Company and its Affiliates shall have the right and are hereby authorized to withhold any applicable withholding taxes in respect of the RSUs and to take such other action as may be necessary to satisfy all obligations for the payment of such withholding taxes, including withholding Shares otherwise deliverable hereunder to satisfy such tax obligations.

9.    Securities Laws. Upon the acquisition of any Shares pursuant to the RSUs, the Participant will make or enter into such written representations, warranties and agreements as the Committee may reasonably request in order to comply with applicable securities laws or with this Agreement.

10.    Notices. Any notice necessary under this Agreement shall be addressed to the Company in care of its Secretary at the principal executive office of the Company and to the Participant at the address appearing in the personnel records of the Company for the Participant or to either party at such other address as either party may designate in writing to the other. Any such notice shall be deemed effective upon receipt by the addressee.

11.    Choice of Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF INDIANA WITHOUT REGARD TO CONFLICTS OF LAWS.

12.    RSUs Subject to Plan. By entering into this Agreement, the Participant agrees and acknowledges that the Participant has received and read a copy of the Plan. The RSUs are subject to the Plan. The terms and provisions of the Plan as they may be amended from time to time are incorporated herein by reference. In the event of a conflict between any term or provision in this Agreement and a term or provision of the Plan, the applicable terms and provisions of the Plan will govern.

13.    Recoupment. The award represented by this Agreement (this “Award”) and the compensation received by the Participant under this Award shall be subject to the terms of any recoupment or clawback policy that may be adopted by the Company from time to time and to any requirement of applicable law, regulation or listing standard that requires the Company to recoup or clawback compensation paid under this Award.

14.    Amendments. The Company may amend this Award at any time, provided that the Participant’s consent to any amendment is required to the extent the amendment materially diminishes the rights of the Participant or results in cancellation of the Award. Notwithstanding the foregoing, the Company need not obtain Participant (or other interested party) consent for (a) the adjustment or cancellation of an Award pursuant to the adjustment provisions of the Plan; (b) the modification of the Award to the extent deemed necessary to comply with any applicable law, the listing requirements of any principal securities exchange or market on which the Shares are then traded; (c) the modification of the Award to preserve favorable accounting or tax treatment of the Award for the Company; or (d) the modification of the Award to the extent the Committee determines that such action does not materially and adversely affect the value of an

3

4885-8514-4755.2

Award or that such action is in the best interest of the affected Participant or any other person(s) as may then have an interest in the Award.

15.    Committee Interpretation. As a condition to the grant of this Award, the Participant agrees (with such agreement being binding upon the Participant’s legal representatives, guardians, legatees or beneficiaries) that this Agreement will be interpreted by the Committee and that any interpretation by the Committee of the terms of this Agreement or the Plan, and any determination made by the Committee under this Agreement or the Plan, will be final, binding and conclusive.

16.    Signature in Counterparts. This Agreement may be signed in counterparts, each of which shall be an original, with the same effect as if the signatures were upon the same instrument.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement.

CUMMINS INC.

By: __________________
Name: ________________
Title: _________________

Agreed and acknowledged as of the date first above written:

Participant: Participant Name

4

4885-8514-4755.2

EX-31.A

EXHIBIT 31(a)

Certification

I, Jennifer Rumsey, certify that:

1.I have reviewed this report on Form 10-Q of Cummins Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	May 2, 2024	/s/ JENNIFER RUMSEY
		Jennifer Rumsey
		Chair and Chief Executive Officer

EX-31.B

EXHIBIT 31(b)

Certification

I, Mark A. Smith, certify that:

1.I have reviewed this report on Form 10-Q of Cummins Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	May 2, 2024	/s/ MARK A. SMITH
		Mark A. Smith
		Vice President and Chief Financial Officer

EX-32

EXHIBIT 32

Cummins Inc.

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Cummins Inc. (the “Company”) on Form 10-Q for the period ended March 31, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned officers of the Company certify, pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002, that to the best of such officer's knowledge:

(1)The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

May 2, 2024	/s/ JENNIFER RUMSEY
	Jennifer Rumsey
	Chair and Chief Executive Officer
May 2, 2024	/s/ MARK A. SMITH
	Mark A. Smith
	Vice President and Chief Financial Officer

XML

DOCUMENT COVER Document	3 Months Ended
	Mar. 31, 2024 $ / shares shares
Cover [Abstract]
Document Type	10-Q
Document Period End Date	Mar. 31, 2024
Entity File Number	1-4949
Entity Registrant Name	CUMMINS INC.
Entity Incorporation, State or Country Code	IN
Entity Tax Identification Number	35-0257090
Entity Address, Address Line One	500 Jackson Street
Entity Address, Address Line Two	Box 3005
Entity Address, City or Town	Columbus
Entity Address, State or Province	IN
Entity Address, Postal Zip Code	47202-3005
City Area Code	812
Local Phone Number	377-5000
Title of 12(b) Security	Common stock, $2.50 par value
Trading Symbol	CMI
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding | shares	136,779,875
Common Stock, Par or Stated Value Per Share | $ / shares	$ 2.50
Entity Central Index Key	0000026172
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q1
Document Quarterly Report	true
Amendment Flag	false
Document Transition Report	false

XML

CONDENSED CONSOLIDATED STATEMENTS OF NET INCOME - USD ($) shares in Millions, $ in Millions	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Income Statement [Abstract]
NET SALES (Notes 1 and 2)	$ 8,403	$ 8,453
Cost of sales	6,362	6,424
GROSS MARGIN	2,041	2,029
OPERATING EXPENSES AND INCOME
Selling, general and administrative expenses	839	753
Research, development and engineering expenses	369	350
Equity, royalty and interest income from investees (Note 4)	123	119
Other operating expense, net	33	19
OPERATING INCOME	923	1,026
Interest expense	89	87
Other income, net (Note 14)	1,387	90
INCOME BEFORE INCOME TAXES	2,221	1,029
Income tax expense (Note 5)	193	223
CONSOLIDATED NET INCOME	2,028	806
Less: Net income attributable to noncontrolling interests	35	16
NET INCOME ATTRIBUTABLE TO CUMMINS INC.	$ 1,993	$ 790
EARNINGS PER COMMON SHARE ATTRIBUTABLE TO CUMMINS INC.
Basic (in dollars per share)	$ 14.10	$ 5.58
Diluted (in dollars per share)	$ 14.03	$ 5.55
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
Basic (in shares)	141.3	141.5
Dilutive effect of stock compensation awards (in shares)	0.8	0.9
Diluted (in shares)	142.1	142.4

XML

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Statement of Comprehensive Income [Abstract]
CONSOLIDATED NET INCOME	$ 2,028	$ 806
Other comprehensive (loss) income, net of tax (Note 12)
Change in pension and other postretirement defined benefit plans	(13)	(9)
Foreign currency translation adjustments	(60)	82
Unrealized gain (loss) on derivatives	12	(3)
Total other comprehensive (loss) income, net of tax	(61)	70
COMPREHENSIVE INCOME	1,967	876
Less: Comprehensive income attributable to noncontrolling interests	32	19
COMPREHENSIVE INCOME ATTRIBUTABLE TO CUMMINS INC.	$ 1,935	$ 857

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) shares in Millions, $ in Millions	Mar. 31, 2024	Dec. 31, 2023
Statement of Financial Position [Abstract]
Common stock, par value (in dollars per share)	$ 2.50
Common stock, shares authorized	500.0
Common stock, shares issued	222.5	222.5
Treasury Stock, Common, Shares	85.7	80.7
Current assets
Cash and cash equivalents	$ 2,541	$ 2,179
Marketable securities (Note 6)	510	562
Total cash, cash equivalents and marketable securities	3,051	2,741
Accounts and notes receivable, net	5,463	5,583
Inventories (Note 7)	5,758	5,677
Prepaid expenses and other current assets	1,348	1,197
Total current assets	15,620	15,198
Long-term assets
Property, plant and equipment	11,253	11,674
Accumulated depreciation	(5,242)	(5,425)
Property, plant and equipment, net	6,011	6,249
Investments and advances related to equity method investees	1,774	1,800
Goodwill	2,406	2,499
Other intangible assets, net	2,455	2,519
Pension assets (Note 3)	1,187	1,197
Other assets (Note 8)	2,374	2,543
Total assets	31,827	32,005
Current liabilities
Accounts payable (principally trade)	4,476	4,260
Loans payable (Note 9)	342	280
Commercial paper (Note 9)	609	1,496
Current maturities of long-term debt (Note 9)	113	118
Accrued compensation, benefits and retirement costs	561	1,108
Current portion of accrued product warranty (Note 10)	652	667
Current portion of deferred revenue (Note 2)	1,236	1,220
Other accrued expenses (Note 8)	3,697	3,754
Total current liabilities	11,686	12,903
Long-term liabilities
Long-term debt (Note 9)	5,771	4,802
Deferred revenue (Note 2)	1,061	966
Other liabilities (Note 8)	3,208	3,430
Total liabilities	21,726	22,101
Commitments and contingencies (Note 11)
Cummins Inc. shareholders' equity
Common stock, $2.50 par value, 500 shares authorized, 222.5 and 222.5 shares issued	2,557	2,564
Retained earnings	19,605	17,851
Treasury stock, at cost, 85.7 and 80.7 shares	(10,831)	(9,359)
Accumulated other comprehensive loss (Note 12)	(2,264)	(2,206)
Total Cummins Inc. shareholders' equity	9,067	8,850
Noncontrolling interests	1,034	1,054
Total equity	10,101	9,904
Total Liabilities and Equity	$ 31,827	$ 32,005

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
CASH FLOWS FROM OPERATING ACTIVITIES
Consolidated net income	$ 2,028	$ 806
Adjustments to reconcile consolidated net income to net cash provided by operating activities
Gain related to divestiture of Atmus (Note 14)	(1,333)	0
Depreciation and amortization	265	246
Deferred income taxes	(38)	(38)
Equity in income of investees, net of dividends	(78)	(67)
Pension and OPEB expense (Note 3)	9	1
Pension contributions and OPEB payments (Note 3)	(48)	(92)
Changes in current assets and liabilities, net of acquisitions and divestitures
Accounts and notes receivable	(11)	(621)
Inventories	(354)	(263)
Other current assets	(175)	(142)
Accounts payable	327	381
Accrued expenses	(393)	151
Other, net	77	133
Net cash provided by operating activities	276	495
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures	(169)	(193)
Acquisition of business, net of cash acquired	(59)	0
Investments in marketable securities—acquisitions	(379)	(326)
Investments in marketable securities—liquidations (Note 6)	431	345
Cash associated with Atmus divestiture	(174)	0
Other, net	(56)	(54)
Net cash used in investing activities	(406)	(228)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from borrowings	2,398	43
Net payments of commercial paper	(887)	(29)
Payments on borrowings and finance lease obligations	(748)	(142)
Dividend payments on common stock	(239)	(222)
Other, net	(25)	(13)
Net cash provided by (used in) financing activities	499	(363)
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(7)	(25)
Net increase (decrease) in cash and cash equivalents	362	(121)
Cash and cash equivalents at beginning of year	2,179	2,101
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$ 2,541	$ 1,980

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CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Millions	Total	Redeemable Noncontrolling Interest	Common Stock	Additional Paid-in Capital	Retained Earnings	Treasury Stock, Common	Accumulated Other Comprehensive Loss	Total Cummins Inc. Shareholders' Equity	Noncontrolling Interests	us-gaap_Net Income in Total Equity Excluding Noncontrolling Interest Amount
Statement of Stockholders' Equity [Abstract]
CASH DIVIDENDS DECLARED PER COMMON SHARE (in dollars per share)	$ 1.57
Redeemable noncontrolling interests at Dec. 31, 2022		$ 258
BALANCE AT BEGINNING OF PERIOD at Dec. 31, 2022	$ 9,967		$ 556	$ 1,687	$ 18,037	$ (9,415)	$ (1,890)	$ 8,975	$ 992
Increase (Decrease) in Shareholders' Equity
Net Income (Loss) Attributable to Redeemable Noncontrolling Interest		(8)
CONSOLIDATED NET INCOME	806				790			790	24	$ 814
Other comprehensive income, net of tax (Note 12)	70						67	67	3
Cash dividends on common stock	(222)				(222)			(222)
Distributions to noncontrolling interests	(22)								(22)
Share-based awards	20			(5)		25		20
Fair value adjustment of redeemable noncontrolling interests	(11)	11		(11)				(11)
Other shareholder transactions	4			3		1		4
Balance at End of Period Redeemable Noncontrolling Interest, Equity, Carrying Amount at Mar. 31, 2023		261
BALANCE AT END OF PERIOD at Mar. 31, 2023	$ 10,620		556	1,674	18,605	(9,389)	(1,823)	9,623	997
Statement of Stockholders' Equity [Abstract]
CASH DIVIDENDS DECLARED PER COMMON SHARE (in dollars per share)	$ 1.68
Redeemable noncontrolling interests at Dec. 31, 2023		0
BALANCE AT BEGINNING OF PERIOD at Dec. 31, 2023	$ 9,904		556	2,008	17,851	(9,359)	(2,206)	8,850	1,054
Increase (Decrease) in Shareholders' Equity
CONSOLIDATED NET INCOME	2,028				1,993			1,993	35	$ 2,028
Other Comprehensive Income, Other, Net of Tax	(122)						(119)	(119)	(3)
Other comprehensive income, net of tax (Note 12)	(61)							(58)	(3)
Cash dividends on common stock	(239)				(239)			(239)
Distributions to noncontrolling interests	(33)								(33)
Share-based awards	54			(6)		60		54
Divestiture of Atmus (Note 14)	(1,490)					(1,532)	61	(1,471)	(19)
Other shareholder transactions	(1)			(1)				(1)
Balance at End of Period Redeemable Noncontrolling Interest, Equity, Carrying Amount at Mar. 31, 2024		$ 0
BALANCE AT END OF PERIOD at Mar. 31, 2024	$ 10,101		$ 556	$ 2,001	$ 19,605	$ (10,831)	$ (2,264)	$ 9,067	$ 1,034

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NATURE OF OPERATIONS AND BASIS OF PRESENTATION

3 Months Ended

Mar. 31, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

NATURE OF OPERATIONS

NOTE 1. NATURE OF OPERATIONS AND BASIS OF PRESENTATION

Overview

Cummins Inc. (“Cummins,” “we,” “our” or “us”) was founded in 1919 as Cummins Engine Company, a corporation in Columbus, Indiana, and one of the first diesel engine manufacturers. In 2001, we changed our name to Cummins Inc. We are a global power solutions leader comprised of five business segments - Components, Engine, Distribution, Power Systems and Accelera - supported by our global manufacturing and extensive service and support network, skilled workforce and vast technical expertise. Our products range from advanced diesel, natural gas, electric and hybrid powertrains and powertrain-related components including aftertreatment, turbochargers, fuel systems, valvetrain technologies, controls systems, air handling systems, automated transmissions, axles, drivelines, brakes, suspension systems, electric power generation systems, batteries, electrified power systems, hydrogen production technologies and fuel cell products. We sell our products to original equipment manufacturers (OEMs), distributors, dealers and other customers worldwide. We serve our customers through a service network of approximately 450 wholly-owned, joint venture and independent distributor locations and more than 19,000 Cummins certified dealer locations in approximately 190 countries and territories.

Divestiture of Atmus

On March 18, 2024, we completed the divestiture of our remaining 80.5 percent ownership of Atmus Filtration Technologies Inc. (Atmus) common stock through a tax-free split-off. See NOTE 14, "ATMUS DIVESTITURE," for additional information.

Settlement Agreements

In December 2023, we announced that we reached an agreement in principle with the U.S. Environmental Protection Agency (EPA), the California Air Resources Board (CARB), the Environmental and Natural Resources Division of the U.S. Department of Justice and the California Attorney General's Office to resolve certain regulatory civil claims regarding our emissions certification and compliance process for certain engines primarily used in pick-up truck applications in the U.S., which became final and effective in April 2024 (collectively, the Settlement Agreements). See NOTE 11, “COMMITMENTS AND CONTINGENCIES,” for additional information.

Interim Condensed Financial Statements

The unaudited Condensed Consolidated Financial Statements reflect all adjustments which, in the opinion of management, are necessary for a fair statement of the results of operations, financial position and cash flows. All such adjustments are of a normal recurring nature. The Condensed Consolidated Financial Statements were prepared in accordance with accounting principles in the United States of America (GAAP) pursuant to the rules and regulations of the Securities and Exchange Commission (SEC) for interim financial information. Certain information and footnote disclosures normally included in annual financial statements were condensed or omitted as permitted by such rules and regulations.

These interim condensed consolidated financial statements should be read in conjunction with the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2023. Our interim period financial results for the three month periods presented are not necessarily indicative of results to be expected for any other interim period or for the entire year. The year-end Condensed Consolidated Balance Sheet data was derived from audited financial statements but does not include all required annual disclosures.

Reclassifications

Certain amounts for prior year periods were reclassified to conform to the current year presentation.

Use of Estimates in Preparation of Financial Statements

Preparation of financial statements requires management to make estimates and assumptions that affect reported amounts presented and disclosed in our Condensed Consolidated Financial Statements. Significant estimates and assumptions in these Condensed Consolidated Financial Statements require the exercise of judgment. Due to the inherent uncertainty involved in making estimates, actual results reported in future periods may be different from these estimates.

Weighted-Average Diluted Shares Outstanding

The weighted-average diluted common shares outstanding exclude the anti-dilutive effect of certain stock options. The options excluded from diluted earnings per share were as follows:

 

	Three months ended
	March 31,
	2024	2023
Options excluded	3,600	4,833

Related Party Transactions

In accordance with the provisions of various joint venture agreements, we may purchase products and components from our joint ventures, sell products and components to our joint ventures and our joint ventures may sell products and components to unrelated parties.

The following is a summary of sales to and purchases from nonconsolidated equity investees:

	Three months ended
	March 31,
In millions	2024		2023
Sales to nonconsolidated equity investees	$	351	$	376
Purchases from nonconsolidated equity investees	653		704

The following is a summary of accounts receivable from and accounts payable to nonconsolidated equity investees:

In millions	March 31, 2024		December 31, 2023		Balance Sheet Location
Accounts receivable from nonconsolidated equity investees	$	425	$	530	Accounts and notes receivable, net
Accounts payable to nonconsolidated equity investees	325		324		Accounts payable (principally trade)

Supply Chain Financing

We currently have supply chain financing programs with financial intermediaries, which provide certain vendors the option to be paid by financial intermediaries earlier than the due date on the applicable invoice. When a vendor utilizes the program and receives an early payment from a financial intermediary, they take a discount on the invoice. We then pay the financial intermediary the face amount of the invoice on the original due date, which generally have 60 to 90 day payment terms. The maximum amount that we could have outstanding under the program was $512 million at March 31, 2024. We do not reimburse vendors for any costs they incur for participation in the program, their participation is completely voluntary and there are no assets pledged as security or other forms of guarantees provided for the committed payment to the finance provider or intermediary. As a result, all amounts owed to the financial intermediaries are presented as accounts payable in our Condensed Consolidated Balance Sheets. Amounts due to the financial intermediaries reflected in accounts payable at March 31, 2024, and December 31, 2023, were $193 million and $199 million, respectively.

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REVENUE RECOGNITION LONG-TERM CONTRACTS AND DEFERRED AND UNBILLED REVENUE

3 Months Ended

Mar. 31, 2024

Revenue from Contract with Customer [Abstract]

Revenue from Contract with Customer

NOTE 2. REVENUE FROM CONTRACTS WITH CUSTOMERS

Long-term Contracts

We have certain arrangements, primarily long-term maintenance agreements, construction contracts, product sales with associated performance obligations extending beyond a year, product sales with lead times extending beyond one year that are non-cancellable or for which the customer incurs a penalty for cancellation and extended warranty coverage arrangements that span a period in excess of one year. The aggregate amount of the transaction price for these contracts, excluding extended warranty coverage arrangements, as of March 31, 2024, was $3.1 billion. We expect to recognize the related revenue of $1.4 billion over the next 12 months and $1.7 billion over periods up to 10 years. See NOTE 10, "PRODUCT WARRANTY LIABILITY," for additional disclosures on extended warranty coverage arrangements. Our other contracts generally are for a duration of less than one year, include payment terms that correspond to the timing of costs incurred when providing goods and services to our customers or represent sales-based royalties.

Deferred and Unbilled Revenue

The following is a summary of our unbilled and deferred revenue and related activity:

In millions	March 31, 2024		December 31, 2023
Unbilled revenue	$	330	$	303
Deferred revenue	2,297		2,186

We recognized revenue of $248 million for the three months ended March 31, 2024, compared with $206 million for the comparable period in 2023, that was included in the deferred revenue balance at the beginning of each year. We did not record any impairment losses on our unbilled revenues during the three months ended March 31, 2024 or 2023.

Disaggregation of Revenue

Consolidated Revenue

The table below presents our consolidated sales by geographic area. Net sales attributed to geographic areas were based on the location of the customer.

	Three months ended
	March 31,
In millions	2024		2023
United States	$	4,785	$	4,802
China	723		790
India	444		411
Other international	2,451		2,450
Total net sales	$	8,403	$	8,453

Segment Revenue

Components segment external sales by business were as follows:

	Three months ended
	March 31,
In millions	2024			2023
Axles and brakes	$	1,232		$	1,272
Emission solutions	856			939
Atmus	289		(1)	342
Engine components	271			292
Automated transmissions	165			178
Software and electronics	29			20
Total sales	$	2,842		$	3,043
(1) Included sales through the March 18, 2024, divestiture. See NOTE 14, "ATMUS DIVESTITURE," for additional information.

Engine segment external sales by market were as follows:

	Three months ended
	March 31,
In millions	2024		2023
Heavy-duty truck	$	811	$	860
Medium-duty truck and bus	738		617
Light-duty automotive	438		441
Total on-highway	1,987		1,918
Off-highway	253		334
Total sales	$	2,240	$	2,252

Distribution segment external sales by region were as follows:

	Three months ended
	March 31,
In millions	2024		2023
North America	$	1,722	$	1,693
Asia Pacific	285		239
Europe	240		194
China	100		101
India	69		57
Latin America	59		53
Africa and Middle East	54		62
Total sales	$	2,529	$	2,399

Distribution segment external sales by product line were as follows:

	Three months ended
	March 31,
In millions	2024		2023
Parts	$	997	$	1,052
Power generation	705		491
Engines	422		456
Service	405		400
Total sales	$	2,529	$	2,399

Power Systems segment external sales by product line were as follows:

	Three months ended
	March 31,
In millions	2024		2023
Power generation	$	360	$	380
Industrial	238		189
Generator technologies	110		110
Total sales	$	708	$	679

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REVENUE RECOGNITION DISAGGREGATION OF REVENUES

3 Months Ended

Mar. 31, 2024

Revenue from Contract with Customer [Abstract]

Revenue from Contract with Customer

NOTE 2. REVENUE FROM CONTRACTS WITH CUSTOMERS

Long-term Contracts

We have certain arrangements, primarily long-term maintenance agreements, construction contracts, product sales with associated performance obligations extending beyond a year, product sales with lead times extending beyond one year that are non-cancellable or for which the customer incurs a penalty for cancellation and extended warranty coverage arrangements that span a period in excess of one year. The aggregate amount of the transaction price for these contracts, excluding extended warranty coverage arrangements, as of March 31, 2024, was $3.1 billion. We expect to recognize the related revenue of $1.4 billion over the next 12 months and $1.7 billion over periods up to 10 years. See NOTE 10, "PRODUCT WARRANTY LIABILITY," for additional disclosures on extended warranty coverage arrangements. Our other contracts generally are for a duration of less than one year, include payment terms that correspond to the timing of costs incurred when providing goods and services to our customers or represent sales-based royalties.

Deferred and Unbilled Revenue

The following is a summary of our unbilled and deferred revenue and related activity:

In millions	March 31, 2024		December 31, 2023
Unbilled revenue	$	330	$	303
Deferred revenue	2,297		2,186

We recognized revenue of $248 million for the three months ended March 31, 2024, compared with $206 million for the comparable period in 2023, that was included in the deferred revenue balance at the beginning of each year. We did not record any impairment losses on our unbilled revenues during the three months ended March 31, 2024 or 2023.

Disaggregation of Revenue

Consolidated Revenue

The table below presents our consolidated sales by geographic area. Net sales attributed to geographic areas were based on the location of the customer.

	Three months ended
	March 31,
In millions	2024		2023
United States	$	4,785	$	4,802
China	723		790
India	444		411
Other international	2,451		2,450
Total net sales	$	8,403	$	8,453

Segment Revenue

Components segment external sales by business were as follows:

	Three months ended
	March 31,
In millions	2024			2023
Axles and brakes	$	1,232		$	1,272
Emission solutions	856			939
Atmus	289		(1)	342
Engine components	271			292
Automated transmissions	165			178
Software and electronics	29			20
Total sales	$	2,842		$	3,043
(1) Included sales through the March 18, 2024, divestiture. See NOTE 14, "ATMUS DIVESTITURE," for additional information.

Engine segment external sales by market were as follows:

	Three months ended
	March 31,
In millions	2024		2023
Heavy-duty truck	$	811	$	860
Medium-duty truck and bus	738		617
Light-duty automotive	438		441
Total on-highway	1,987		1,918
Off-highway	253		334
Total sales	$	2,240	$	2,252

Distribution segment external sales by region were as follows:

	Three months ended
	March 31,
In millions	2024		2023
North America	$	1,722	$	1,693
Asia Pacific	285		239
Europe	240		194
China	100		101
India	69		57
Latin America	59		53
Africa and Middle East	54		62
Total sales	$	2,529	$	2,399

Distribution segment external sales by product line were as follows:

	Three months ended
	March 31,
In millions	2024		2023
Parts	$	997	$	1,052
Power generation	705		491
Engines	422		456
Service	405		400
Total sales	$	2,529	$	2,399

Power Systems segment external sales by product line were as follows:

	Three months ended
	March 31,
In millions	2024		2023
Power generation	$	360	$	380
Industrial	238		189
Generator technologies	110		110
Total sales	$	708	$	679

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PENSION AND OTHER POSTRETIREMENT BENEFITS

3 Months Ended

Mar. 31, 2024

Retirement Benefits [Abstract]

PENSION AND OTHER POSTRETIREMENT BENEFITS

NOTE 3. PENSIONS AND OTHER POSTRETIREMENT BENEFITS

We sponsor funded and unfunded domestic and foreign defined benefit pension and other postretirement benefit (OPEB) plans. Contributions to these plans were as follows:

	Three months ended
	March 31,
In millions	2024		2023
Defined benefit pension contributions	$	39	$	88
OPEB payments, net	9		4
Defined contribution pension plans	48		43

We anticipate making additional defined benefit pension contributions during the remainder of 2024 of $29 million for our U.S. and U.K. qualified and non-qualified pension plans. These contributions may be made from trusts or company funds either to increase pension assets or to make direct benefit payments to plan participants. We expect our 2024 annual net periodic pension cost to approximate $34 million.

The components of net periodic pension and OPEB expense (income) under our plans were as follows:

	Pension
	U.S. Plans				U.K. Plans				OPEB
	Three months ended March 31,
In millions	2024		2023		2024		2023		2024		2023
Service cost	$	35	$	29	$	4	$	4	$	—	$	—
Interest cost	42		42		18		17		2		2
Expected return on plan assets	(72)		(69)		(25)		(25)		—		—
Recognized net actuarial loss (gain)	3		2		3		—		(1)		(1)
Net periodic benefit expense (income)	$	8	$	4	$	—	$	(4)	$	1	$	1

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EQUITY, ROYALTY AND INTEREST INCOME FROM INVESTEES

3 Months Ended

Mar. 31, 2024

Equity Method Investments and Joint Ventures [Abstract]

EQUITY, ROYALTY AND INTEREST INCOME FROM INVESTEES

NOTE 4. EQUITY, ROYALTY AND INTEREST INCOME FROM INVESTEES

Equity, royalty and interest income from investees included in our Condensed Consolidated Statements of Net Income for the reporting period was as follows:

	Three months ended
	March 31,
In millions	2024		2023
Manufacturing entities
Dongfeng Cummins Engine Company, Ltd.	$	22	$	19
Chongqing Cummins Engine Company, Ltd.	15		9
Beijing Foton Cummins Engine Co., Ltd.	13		16
Tata Cummins, Ltd.	9		8
All other manufacturers	23		19
Distribution entities
Komatsu Cummins Chile, Ltda.	13		14
All other distributors	5		3
Cummins share of net income	100		88
Royalty and interest income	23		31
Equity, royalty and interest income from investees	$	123	$	119

In September 2023, our Accelera business signed an agreement to form a joint venture with Daimler Trucks and Buses US Holding LLC (Daimler Truck), PACCAR Inc. (PACCAR) and EVE Energy to accelerate and localize battery cell production and the battery supply chain in the U.S., including building a 21-gigawatt hour battery production facility in Marshall County, Mississippi. The joint venture will manufacture battery cells for electric commercial vehicles and industrial applications. Accelera, Daimler Truck and PACCAR will each own 30 percent of the joint venture, while EVE Energy will own 10 percent. Total investment by the partners is expected to be in the range of $2 billion to $3 billion for the 21-gigawatt hour facility. The transaction received all applicable merger control and regulatory approvals during or prior to April 2024, and the joint venture formation and initial funding are expected to be finalized in the second quarter of 2024.

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INCOME TAXES

3 Months Ended

Mar. 31, 2024

Income Tax Disclosure [Abstract]

Income Tax Disclosure

NOTE 5. INCOME TAXES

Our effective tax rates for the three months ended March 31, 2024 and 2023, were 8.7 percent and 21.7 percent, respectively.

The three months ended March 31, 2024, contained favorable discrete tax items primarily due to the $1.3 billion non-taxable gain on the Atmus split-off. Other discrete tax items were $21 million favorable primarily due to adjustments related to audit settlements.

The three months ended March 31, 2023, contained favorable discrete tax items of $3 million, primarily due to share-based compensation tax benefits.

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MARKETABLE SECURITIES

3 Months Ended

Mar. 31, 2024

Investments, Debt and Equity Securities [Abstract]

MARKETABLE SECURITIES

NOTE 6. MARKETABLE SECURITIES

A summary of marketable securities, all of which were classified as current, was as follows:

	March 31, 2024						December 31, 2023
In millions	Cost		Gross unrealized gains/(losses) (1)		Estimated fair value		Cost		Gross unrealized gains/(losses) (1)		Estimated fair value
Equity securities
Certificates of deposit	$	245	$	—	$	245	$	246	$	—	$	246
Debt mutual funds	225		(1)		224		272		—		272
Equity mutual funds	21		7		28		22		6		28
Debt securities	13		—		13		16		—		16
Marketable securities	$	504	$	6	$	510	$	556	$	6	$	562
(1) Unrealized gains and losses for debt securities are recorded in other comprehensive income while unrealized gains and losses for equity securities are recorded in our Condensed Consolidated Statements of Net Income.

All debt securities are classified as available-for-sale. All marketable securities presented use a Level 2 fair value measure. The fair value of Level 2 securities is estimated using actively quoted prices for similar instruments from brokers and observable inputs where available, including market transactions and third-party pricing services, or net asset values provided to investors. We do not currently have any Level 3 securities, and there were no transfers between Level 2 or 3 during the three months ended March 31, 2024, or the year ended December 31, 2023.

A description of the valuation techniques and inputs used for our Level 2 fair value measures is as follows:

•Certificates of deposit — These investments provide us with a contractual rate of return and generally range in maturity from three months to five years. The counterparties to these investments are reputable financial institutions with investment grade credit ratings. Since these instruments are not tradable and must be settled directly by us with the respective financial institution, our fair value measure is the financial institution's month-end statement.

•Debt mutual funds — The fair value measures for the vast majority of these investments are the daily net asset values published on a regulated governmental website. Daily quoted prices are available from the issuing brokerage and are used on a test basis to corroborate this Level 2 input measure.

•Equity mutual funds — The fair value measures for these investments are the net asset values published by the issuing brokerage. Daily quoted prices are available from reputable third-party pricing services and are used on a test basis to corroborate this Level 2 input measure.

•Debt securities — The fair value measures for these securities are broker quotes received from reputable firms. These securities are infrequently traded on a national exchange and these values are used on a test basis to corroborate our Level 2 input measure.

The proceeds from sales and maturities of marketable securities were as follows:

	Three months ended
	March 31,
In millions	2024		2023
Proceeds from sales of marketable securities	$	426	$	276
Proceeds from maturities of marketable securities	5		69
Investments in marketable securities - liquidations	$	431	$	345

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INVENTORIES

3 Months Ended

Mar. 31, 2024

Inventory Disclosure [Abstract]

INVENTORIES

NOTE 7. INVENTORIES

Inventories are stated at the lower of cost or net realizable value. Inventories included the following:

 

In millions	March 31, 2024		December 31, 2023
Finished products	$	2,931	$	2,770
Work-in-process and raw materials	3,049		3,156
Inventories at FIFO cost	5,980		5,926
Excess of FIFO over LIFO	(222)		(249)
Inventories	$	5,758	$	5,677

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SUPPLEMENTAL BALANCE SHEET DATA

3 Months Ended

Mar. 31, 2024

Balance Sheet Related Disclosures [Abstract]

SUPPLEMENTAL BALANCE SHEET DATA

NOTE 8. SUPPLEMENTAL BALANCE SHEET DATA

Other assets included the following:

In millions	March 31, 2024		December 31, 2023
Deferred income taxes	$	950	$	1,082
Operating lease assets	455		501
Corporate owned life insurance	419		417
Other	550		543
Other assets	$	2,374	$	2,543

Other accrued expenses included the following:

In millions	March 31, 2024		December 31, 2023
Settlement Agreements (1)	$	1,938	$	1,938
Income taxes payable	361		242
Marketing accruals	340		399
Other taxes payable	222		296
Current portion of operating lease liabilities	129		138
Other	707		741
Other accrued expenses	$	3,697	$	3,754
(1) See NOTE 11, "COMMITMENTS AND CONTINGENCIES," for additional information.

Other liabilities included the following:

In millions	March 31, 2024		December 31, 2023
Accrued product warranty (1)	$	816	$	777
Pensions	495		530
Deferred income taxes	355		530
Operating lease liabilities	332		374
Accrued compensation	186		213
Mark-to-market valuation on interest rate derivatives	124		117
Other postretirement benefits	123		131
Long-term income taxes	111		111
Other	666		647
Other liabilities	$	3,208	$	3,430
(1) See NOTE 10, "PRODUCT WARRANTY LIABILITY," for additional information.

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DEBT

3 Months Ended

Mar. 31, 2024

Debt Disclosure [Abstract]

DEBT

NOTE 9. DEBT

Loans Payable and Commercial Paper

Loans payable, commercial paper and the related weighted-average interest rates were as follows:

In millions	March 31, 2024		December 31, 2023
Loans payable (1)	$	342	$	280
Commercial paper (2)	609		1,496
(1) Loans payable consist primarily of notes payable to various domestic and international financial institutions. It is not practicable to aggregate these notes and calculate a quarterly weighted-average interest rate.
(2) The weighted-average interest rate, inclusive of all brokerage fees, was 5.23 percent and 5.43 percent at March 31, 2024, and December 31, 2023, respectively.

We can issue up to $4.0 billion of unsecured, short-term promissory notes (commercial paper) pursuant to the Board of Directors authorized commercial paper programs. These programs facilitate the private placement of unsecured short-term debt through third-party brokers. We intend to use the net proceeds from the commercial paper borrowings for general corporate purposes.

Revolving Credit Facilities

Our committed credit facilities provide access up to $4.0 billion, including our $2.0 billion 364-day facility that expires June 3, 2024, and our $2.0 billion five-year facility that expires on August 18, 2026. We intend to maintain credit facilities at the current or higher aggregate amounts by renewing or replacing these facilities at or before expiration. These revolving credit facilities are maintained primarily to provide backup liquidity for our commercial paper borrowings and general corporate purposes. There were no outstanding borrowings under these facilities at March 31, 2024, and December 31, 2023. At March 31, 2024, the $609 million of outstanding commercial paper effectively reduced the $4.0 billion of revolving credit capacity to $3.4 billion.

At March 31, 2024, we also had an additional $396 million available for borrowings under our international and other domestic credit facilities.

Long-term Debt

A summary of long-term debt was as follows:

In millions	Interest Rate	March 31, 2024		December 31, 2023
Long-term debt
Hydrogenics promissory notes, due 2024 and 2025	—%	$	160	$	160
Term loan, due 2025 (1) (2)	Variable	500		1,150
Senior notes, due 2025 (3)	0.75%	500		500
Atmus term loan, due 2027 (4)	Variable	—		600
Debentures, due 2027	6.75%	58		58
Debentures, due 2028	7.125%	250		250
Senior notes, due 2029	4.90%	500		—
Senior notes, due 2030 (3)	1.50%	850		850
Senior notes, due 2034	5.15%	750		—
Senior notes, due 2043	4.875%	500		500
Senior notes, due 2050	2.60%	650		650
Senior notes, due 2054	5.45%	1,000		—
Debentures, due 2098 (5)	5.65%	165		165
Other debt		90		94
Unamortized discount and deferred issuance costs		(100)		(72)
Fair value adjustments due to hedge on indebtedness		(111)		(96)
Finance leases		122		111
Total long-term debt		5,884		4,920
Less: Current maturities of long-term debt		113		118
Long-term debt		$	5,771	$	4,802
(1) During the first three months of 2024, we paid down $650 million of the term loan.
(2) In 2023, we entered into a series of interest rate swaps in order to trade a portion of the floating rate debt into fixed rate. See "Interest Rate Risk" in NOTE 13, "DERIVATIVES," for additional information.
(3) In 2021, we entered into a series of interest rate swaps to effectively convert debt from a fixed rate to floating rate. See "Interest Rate Risk" in NOTE 13, "DERIVATIVES," for additional information.
(4) See NOTE 14, "ATMUS DIVESTITURE," for additional information.
(5) The effective interest rate is 7.48 percent.

On February 20, 2024, we issued $2.25 billion aggregate principal amount of senior unsecured notes consisting of $500 million aggregate principal amount of 4.90 percent senior unsecured notes due in 2029, $750 million aggregate principal amount of 5.15 percent senior unsecured notes due in 2034 and $1.0 billion aggregate principal amount of 5.45 percent senior unsecured notes due in 2054. We received net proceeds of $2.2 billion. The senior unsecured notes pay interest semi-annually on February 20 and August 20, commencing on August 20, 2024. The indenture governing the senior unsecured notes contains covenants that, among other matters, limit (i) our ability to consolidate or merge into, or sell, assign, convey, lease, transfer or otherwise dispose of all or substantially all of our and our subsidiaries' assets to another person, (ii) our and certain of our subsidiaries' ability to create or assume liens and (iii) our and certain of our subsidiaries' ability to engage in sale and leaseback transactions.

Principal payments required on long-term debt during the next five years are as follows:

In millions	2024		2025		2026		2027		2028
Principal payments	$	101	$	1,128	$	41	$	76	$	267

Fair Value of Debt

Based on borrowing rates currently available to us for bank loans with similar terms and average maturities, considering our risk premium, the fair values and carrying values of total debt, including current maturities, were as follows:

 

In millions	March 31, 2024		December 31, 2023
Fair value of total debt (1)	$	6,491	$	6,375
Carrying value of total debt	6,835		6,696
(1) The fair value of debt is derived from Level 2 input measures.

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PRODUCT WARRANTY LIABILITY

3 Months Ended

Mar. 31, 2024

Product Warranties Disclosures [Abstract]

PRODUCT WARRANTY LIABILITY

NOTE 10. PRODUCT WARRANTY LIABILITY

A tabular reconciliation of the product warranty liability, including the deferred revenue related to our extended warranty coverage and accrued product campaigns, was as follows:

	Three months ended
	March 31,
In millions	2024		2023
Balance at beginning of year	$	2,497	$	2,477
Provision for base warranties issued	160		146
Deferred revenue on extended warranty contracts sold	96		102
Provision for product campaigns issued	6		6
Payments made during period	(176)		(143)
Amortization of deferred revenue on extended warranty contracts	(77)		(75)
Changes in estimates for pre-existing product warranties and campaigns	51		10
Foreign currency translation adjustments and other	(18)		7
Balance at end of period	$	2,539	$	2,530

We recognized supplier recoveries of $22 million for the three months ended March 31, 2024, compared with $10 million for the comparable period in 2023.

Warranty related deferred revenues and warranty liabilities on our Condensed Consolidated Balance Sheets were as follows:

In millions	March 31, 2024		December 31, 2023		Balance Sheet Location
Deferred revenue related to extended coverage programs
Current portion	$	274	$	279	Current portion of deferred revenue
Long-term portion	797		774		Deferred revenue
Total	$	1,071	$	1,053
Product warranty
Current portion	$	652	$	667	Current portion of accrued product warranty
Long-term portion	816		777		Other liabilities
Total	$	1,468	$	1,444
Total warranty accrual	$	2,539	$	2,497

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COMMITMENTS AND CONTINGENCIES

3 Months Ended

Mar. 31, 2024

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

NOTE 11. COMMITMENTS AND CONTINGENCIES

Legal Proceedings

We are subject to numerous lawsuits and claims arising out of the ordinary course of our business, including actions related to product liability; personal injury; the use and performance of our products; warranty matters; product recalls; patent, trademark or other intellectual property infringement; contractual liability; the conduct of our business; tax reporting in foreign jurisdictions; distributor termination; workplace safety; environmental and regulatory matters, including the enforcement of environmental and emissions standards; and asbestos claims. We also have been identified as a potentially responsible party at multiple waste disposal sites under U.S. federal and related state environmental statutes and regulations and may have joint and several liability for any investigation and remediation costs incurred with respect to such sites. We have denied liability with respect to many of these lawsuits, claims and proceedings and are vigorously defending such lawsuits, claims and proceedings. We carry various forms of commercial, property and casualty, product liability and other forms of insurance; however, such insurance may not be applicable or adequate to cover the costs associated with a judgment against us with respect to these lawsuits, claims and proceedings. We do not believe that these lawsuits are material individually or in the aggregate. While we believe we have also established adequate accruals for our expected future liability with respect to pending lawsuits, claims and proceedings, where the nature and extent of any such liability can be reasonably estimated based upon then presently available information, there can be no assurance that the final resolution of any existing or future lawsuits, claims or proceedings will not have a material adverse effect on our business, results of operations, financial condition or cash flows.

We conduct significant business operations in Brazil that are subject to the Brazilian federal, state and local labor, social security, tax and customs laws. While we believe we comply with such laws, they are complex, subject to varying interpretations and we are often engaged in litigation regarding the application of these laws to particular circumstances.

In December 2023, we announced that we reached an agreement in principle with the EPA, CARB, the Environmental and Natural Resources Division of the U.S. Department of Justice and the California Attorney General’s Office to resolve certain regulatory civil claims regarding our emissions certification and compliance process for certain engines primarily used in pick-up truck applications in the U.S., which became final and effective in April 2024 (collectively, the Settlement Agreements). As part of the Settlement Agreements, among other things, we agreed to pay civil penalties, complete recall requirements, undertake mitigation projects, provide extended warranties, undertake certain testing, take certain corporate compliance measures and make other payments. Failure to comply with the Settlement Agreements will subject us to stipulated penalties. We recorded a charge of $2.0 billion in the fourth quarter of 2023 to resolve the matters addressed by the Settlement Agreements involving approximately one million of our pick-up truck applications in the U.S. This charge was in addition to the previously announced charges of $59 million for the recalls of model years 2013 through 2018 RAM 2500 and 3500 trucks and model years 2016 through 2019 Titan trucks. We began making payments on certain of the Settlement Agreements in April 2024; however, the majority of the Settlement Agreement payments will be made in May 2024.

We have also been in communication with other non-U.S. regulators regarding matters related to the emission systems in our engines and may also become subject to additional regulatory review in connection with these matters.

In connection with our announcement of our entry into the agreement in principle, we became subject to shareholder, consumer and third-party litigation regarding the matters covered by the Settlement Agreements, and we may become subject to additional litigation in connection with these matters.

The consequences resulting from the resolution of the foregoing matters are uncertain and the related expenses and reputational damage could have a material adverse impact on our results of operations, financial condition and cash flows.

Guarantees and Commitments

Periodically, we enter into guarantee arrangements, including guarantees of non-U.S. distributor financings, residual value guarantees on equipment under operating leases and other miscellaneous guarantees of joint ventures or third-party obligations. At March 31, 2024, the maximum potential loss related to these guarantees was $39 million.

We have arrangements with certain suppliers that require us to purchase minimum volumes or be subject to monetary penalties. At March 31, 2024, if we were to stop purchasing from each of these suppliers, the aggregate amount of the penalty would be approximately $584 million. These arrangements enable us to secure supplies of critical components and IT services. We do not currently anticipate paying any penalties under these contracts.

We enter into physical forward contracts with suppliers of platinum, palladium and iridium to purchase certain volumes of the commodities at contractually stated prices for various periods, which generally fall within two years. At March 31, 2024, the total commitments under these contracts were $64 million. These arrangements enable us to guarantee the prices of these commodities, which otherwise are subject to market volatility.

We have guarantees with certain customers that require us to satisfactorily honor contractual or regulatory obligations, or compensate for monetary losses related to nonperformance. These performance bonds and other performance-related guarantees were $192 million at March 31, 2024.

Indemnifications

Periodically, we enter into various contractual arrangements where we agree to indemnify a third-party against certain types of losses. Common types of indemnities include:

•product liability and license, patent or trademark indemnifications;

•asset sale agreements where we agree to indemnify the purchaser against future environmental exposures related to the asset sold; and

•any contractual agreement where we agree to indemnify the counterparty for losses suffered as a result of a misrepresentation in the contract.

We regularly evaluate the probability of having to incur costs associated with these indemnities and accrue for expected losses that are probable. Because the indemnifications are not related to specified known liabilities and due to their uncertain nature, we are unable to estimate the maximum amount of the potential loss associated with these indemnifications.

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

3 Months Ended

Mar. 31, 2024

Equity [Abstract]

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

NOTE 12. ACCUMULATED OTHER COMPREHENSIVE LOSS

Following are the changes in accumulated other comprehensive income (loss) by component for the three months ended:

In millions	Change in pension and OPEB plans		Foreign currency translation adjustment			Unrealized gain (loss) on derivatives		Total attributable to Cummins Inc.		Noncontrolling interests		Total
Balance at December 31, 2023	$	(848)	$	(1,457)		$	99	$	(2,206)
Other comprehensive income (loss) before reclassifications
Before-tax amount	(21)		(116)			22		(115)		$	(3)	$	(118)
Tax expense	3		(2)			(5)		(4)		—		(4)
After-tax amount	(18)		(118)			17		(119)		(3)		(122)
Amounts reclassified from accumulated other comprehensive income (loss) (1)	5		61		(2)	(5)		61		—		61
Net current period other comprehensive (loss) income	(13)		(57)			12		(58)		$	(3)	$	(61)
Balance at March 31, 2024	$	(861)	$	(1,514)		$	111	$	(2,264)
Balance at December 31, 2022	$	(427)	$	(1,552)		$	89	$	(1,890)
Other comprehensive income (loss) before reclassifications
Before-tax amount	(13)		75			(3)		59		$	3	$	62
Tax benefit	2		4			1		7		—		7
After-tax amount	(11)		79			(2)		66		3		69
Amounts reclassified from accumulated other comprehensive income (loss) (1)	2		—			(1)		1		—		1
Net current period other comprehensive (loss) income	(9)		79			(3)		67		$	3	$	70
Balance at March 31, 2023	$	(436)	$	(1,473)		$	86	$	(1,823)
(1) Amounts are net of tax. Reclassifications out of accumulated other comprehensive income (loss) and the related tax effects are immaterial for separate disclosure.
(2) Primarily related to the divestiture of Atmus. See NOTE 14, "ATMUS DIVESTITURE," for additional information.

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DERIVATIVES

3 Months Ended

Mar. 31, 2024

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments and Hedging Activities Disclosure

NOTE 13. DERIVATIVES

We are exposed to financial risk resulting from volatility in foreign exchange rates, interest rates and commodity prices. This risk is closely monitored and managed through the use of physical forward contracts (which are not considered derivatives) and financial derivative instruments including foreign currency forward contracts, commodity swap contracts and interest rate swaps. Financial derivatives are used expressly for hedging purposes and under no circumstances are they used for speculative purposes. When material, we adjust the estimated fair value of our derivative contracts for counterparty or our credit risk. None of our derivative instruments are subject to collateral requirements. Substantially all of our derivative contracts are subject to master netting arrangements, which provide us with the option to settle certain contracts on a net basis when they settle on the same day with the same currency. In addition, these arrangements provide for a net settlement of all contracts with a given counterparty in the event that the arrangement is terminated due to the occurrence of default or a termination event.

Foreign Currency Exchange Rate Risk

We had foreign currency forward contracts with notional amounts of $5.0 billion at March 31, 2024, with the following currencies comprising 86 percent of outstanding foreign currency forward contracts: British pound, Chinese renminbi, Canadian dollar, Australian dollar and Euro. We had foreign currency forward contracts with notional amounts of $4.5 billion at December 31, 2023, with the following currencies comprising 85 percent of outstanding foreign currency forward contracts: British pound, Chinese renminbi, Canadian dollar, Australian dollar and Swedish kronor.

We are further exposed to foreign currency exchange risk as many of our subsidiaries are subject to fluctuations as the functional currencies of the underlying entities are not our U.S. dollar reporting currency. To help reduce volatility in the equity value of our subsidiaries, we enter into foreign exchange forwards designated as net investment hedges for certain of our investments. Under the current terms of our foreign exchange forwards, we agreed with third parties to sell British pounds and Chinese renminbi in exchange for U.S. dollar currency at a specified rate at the maturity of the contract. The notional amount of these hedges at March 31, 2024, was $1.0 billion.

The following table summarizes the net investment hedge activity in accumulated other comprehensive loss (AOCL):

	Three months ended
	March 31,
In millions	2024				2023
Type of Derivative	Gain (Loss)  Recognized in AOCL		Gain (Loss) Reclassified from AOCL into Earnings		Gain (Loss)  Recognized in AOCL		Gain (Loss) Reclassified from AOCL into Earnings
Foreign exchange forwards	$	6	$	—	$	(15)	$	—

Interest Rate Risk

In September 2023, we entered into a series of interest rate swaps with a total notional value of $500 million in order to trade a portion of the floating rate into a fixed rate on our term loan, due in 2025. The maturity date of the interest rate swaps is August 1, 2025. The weighted-average interest rate of the interest rate swaps is 5.72 percent. We designated the swaps as cash flow hedges. The gains and losses on these derivative instruments are initially recorded in other comprehensive income and reclassified into earnings as interest expense in the Condensed Consolidated Financial Statements as each interest payment is accrued.

The following table summarizes the interest rate swap activity in AOCL:

	Three months ended
	March 31,
In millions	2024
Type of Swap	Gain (Loss)  Recognized in AOCL		Gain (Loss) Reclassified from AOCL into Interest Expense
Interest rate swaps	$	3	$	—

In 2021, we entered into a series of interest rate swaps to effectively convert our $500 million senior notes, due in 2025, from a fixed rate of 0.75 percent to a floating rate equal to the three-month London Interbank Offered Rate (LIBOR) plus a spread (subsequently adjusted to Secured Overnight Financing Rate (SOFR) under a fallback protocol in our derivative agreements in the third quarter of 2023), and $400 million of the notional amount remained unsettled at March 31, 2024. We also entered into a series of interest rate swaps to effectively convert $765 million of our $850 million senior notes, due in 2030, from a fixed rate of 1.50 percent to a floating rate equal to the three-month LIBOR plus a spread (also similarly adjusted to SOFR). We designated the swaps as fair value hedges. The gain or loss on these derivative instruments, as well as the offsetting gain or loss on the hedged item attributable to the hedged risk, are recognized in current income as interest expense. The net swap settlements that accrue each period are also reported in the Condensed Consolidated Financial Statements as interest expense.

The following table summarizes the gains and losses:

	Three months ended
	March 31,
In millions	2024				2023
Type of Swap	Gain (Loss)  on Swaps		Gain (Loss) on Borrowings		Gain (Loss)  on Swaps		Gain (Loss) on Borrowings
Interest rate swaps (1)	$	(10)	$	14	$	27	$	(22)
(1) The difference between the gain (loss) on swaps and borrowings represents hedge ineffectiveness.

Derivatives Not Designated as Hedging Instruments

The following table summarizes the effect on our Condensed Consolidated Statements of Net Income for derivative instruments not designated as hedging instruments:

	Three months ended
	March 31,
In millions	2024		2023
Loss recognized in income - Cost of sales (1)	$	—	$	(2)
(Loss) gain recognized in income - Other income (expense), net (1)	(40)		27
(1) Includes foreign currency forward contracts.

Fair Value Amount and Location of Derivative Instruments

The following table summarizes the location and fair value of derivative instruments on our Condensed Consolidated Balance Sheets:

	Derivatives Designated as Hedging Instruments				Derivatives Not Designated as Hedging Instruments
In millions	March 31, 2024		December 31, 2023		March 31, 2024		December 31, 2023
Notional amount	$	3,257	$	2,997	$	4,064	$	3,610
Derivative assets
Prepaid expenses and other current assets (1)	$	21	$	14	$	9	$	16
Derivative liabilities
Other accrued expenses	$	4	$	43	$	8	$	14
Other liabilities	124		117		11		—
Total derivative liabilities (1)	$	128	$	160	$	19	$	14
(1) Estimates of the fair value of all derivative assets and liabilities above are derived from Level 2 inputs, which are estimated using actively quoted prices for similar instruments from brokers and observable inputs where available, including market transactions and third-party pricing services, or net asset values provided to investors. We do not currently have any Level 3 input measures and there were no transfers into or out of Level 2 or 3 during the three months ended March 31, 2024, or the year ended December 31, 2023.

We elected to present our derivative contracts on a gross basis in our Condensed Consolidated Balance Sheets. Had we chosen to present on a net basis, we would have derivatives in a net asset position of $13 million and $4 million and derivatives in a net liability position of $130 million and $148 million at March 31, 2024, and December 31, 2023, respectively.

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Atmus Divestiture

3 Months Ended

Mar. 31, 2024

Business Acquisition [Line Items]

Mergers, Acquisitions and Dispositions Disclosures

NOTE 14. ATMUS DIVESTITURE

On March 18, 2024, we completed the divestiture of our remaining 80.5 percent ownership of Atmus common stock through a tax-free split-off. The transaction involved the exchange of our shares in Atmus for shares of Cummins stock with a 7.0 percent discount on the exchange ratio for Atmus shares. The exchange ratio was determined based on each entity's respective stock price using the daily volume weighted-average stock price for three days preceding the final exchange offer date. Based on the final exchange ratio, we exchanged all 67 million of our Atmus shares for 5.6 million shares of Cummins stock, which was recorded as treasury stock based on the fair value of the Cummins shares obtained.

We evaluated the full divestiture of Atmus and determined the transaction did not qualify for discontinued operation presentation. We recognized a gain related to the divestiture of approximately $1.3 billion (based on the difference between the fair value of the Cummins shares obtained less the carrying value of our Atmus investment), which was recorded as other income in the Condensed Consolidated Statements of Net Income for the three months ended March 31, 2024. Approximately $114 million of goodwill was included in the carrying value of the Atmus investment for purposes of calculating the gain. The operating results of Atmus were reported in the Condensed Consolidated Financial Statements through March 18, 2024, the date of divestiture.

As part of the divestiture, the $600 million term loan remained with Atmus after the split. In addition, a net $61 million of other comprehensive income and $19 million of noncontrolling interests related to Atmus were written-off and netted against the gain recognized upon the split.

We entered into a transitional services agreement (TSA) with Atmus that is designed to facilitate the orderly transfer of various services to Atmus. The TSA relates primarily to administrative services, which are generally to be provided over the next 24 months. This agreement is not material and does not confer upon us the ability to influence the operating and/or financial policies of Atmus subsequent to March 18, 2024.

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OPERATING SEGMENTS

3 Months Ended

Mar. 31, 2024

Segment Reporting [Abstract]

OPERATING SEGMENTS

NOTE 15. OPERATING SEGMENTS

Operating segments under GAAP are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the Chief Operating Decision Maker (CODM), or decision-making group, in deciding how to allocate resources and in assessing performance. Our CODM is the Chief Executive Officer.

Our reportable operating segments consist of Components, Engine, Distribution, Power Systems and Accelera. This reporting structure is organized according to the products and markets each segment serves. The Components segment sells axles, drivelines, brakes and suspension systems for commercial diesel and natural gas applications, aftertreatment systems, turbochargers, fuel systems, valvetrain technologies, automated transmissions and electronics. The Engine segment produces engines (15 liters and smaller) and associated parts for sale to customers in on-highway and various off-highway markets. Our engines are used in trucks of all sizes, buses and recreational vehicles, as well as in various industrial applications, including construction, agriculture, power generation systems and other off-highway applications. The Distribution segment includes wholly-owned and partially-owned distributorships engaged in wholesaling engines, generator sets and service parts, as well as performing service and repair activities on our products and maintaining relationships with various OEMs throughout the world. The Power Systems segment is an integrated power provider, which designs, manufactures and sells engines (16 liters and larger) for industrial applications (including mining, oil and gas, marine and rail), standby and prime power generator sets, alternators and other power components. The Accelera segment designs, manufactures, sells and supports hydrogen production technologies as well as electrified power systems with innovative components and subsystems, including battery, fuel cell and electric powertrain technologies. The Accelera segment is currently in the early stages of commercializing these technologies with efforts primarily focused on the development of our electrolyzers for hydrogen production and electrified power systems and related components and subsystems. We continue to serve all our markets as they adopt electrification and alternative power technologies, meeting the needs of our OEM partners and end customers.

We use segment earnings or losses before interest expense, income taxes, depreciation and amortization and noncontrolling interests (EBITDA) as the basis for the CODM to evaluate the performance of each of our reportable operating segments. We believe EBITDA is a useful measure of our operating performance as it assists investors and debt holders in comparing our performance on a consistent basis without regard to financing methods, capital structure, income taxes or depreciation and amortization methods, which can vary significantly depending upon many factors. Segment amounts exclude certain expenses not specifically identifiable to segments.

The accounting policies of our operating segments are the same as those applied in our Condensed Consolidated Financial Statements. We prepared the financial results of our operating segments on a basis that is consistent with the manner in which we internally disaggregate financial information to assist in making internal operating decisions. We allocate certain common costs and expenses, primarily corporate functions, among segments differently than we would for stand-alone financial information prepared in accordance

with GAAP. These include certain costs and expenses of shared services, such as information technology, human resources, legal, finance and supply chain management. We do not allocate gains or losses of corporate owned life insurance and the gain and certain costs related to the divestiture of Atmus. See NOTE 14, "ATMUS DIVESTITURE," for additional information. EBITDA may not be consistent with measures used by other companies.

Summarized financial information regarding our reportable operating segments for the three months ended is shown in the table below:

In millions	Components			Engine		Distribution		Power Systems		Accelera		Total Segments
Three months ended March 31, 2024
External sales	$	2,842		$	2,240	$	2,529	$	708	$	84	$	8,403
Intersegment sales	490			688		6		681		9		1,874
Total sales	3,332			2,928		2,535		1,389		93		10,277
Research, development and engineering expenses	84			154		14		60		55		367
Equity, royalty and interest income (loss) from investees	26			57		24		19		(3)		123
Interest income	8			7		11		3		—		29
Segment EBITDA	473		(1)	414		294		237		(101)		1,317
Depreciation and amortization (2)	125			58		31		34		14		262
Three months ended March 31, 2023
External sales	$	3,043		$	2,252	$	2,399	$	679	$	80	$	8,453
Intersegment sales	514			734		7		664		5		1,924
Total sales	3,557			2,986		2,406		1,343		85		10,377
Research, development and engineering expenses	91			134		14		63		48		350
Equity, royalty and interest income (loss) from investees	21			65		24		13		(4)		119
Interest income	6			3		7		2		—		18
Segment EBITDA	507		(3)	457		335		219		(94)		1,424
Depreciation and amortization (2)	123			51		28		29		14		245
(1) Included $21 million costs associated with the divestiture of Atmus for the three months ended March 31, 2024. See NOTE 14, "ATMUS DIVESTITURE," for additional information.
(2) Depreciation and amortization, as shown on a segment basis, excludes the amortization of debt discount and deferred costs included in the Condensed Consolidated Statements of Net Income as interest expense. The amortization of debt discount and deferred costs was $3 million and $1 million for the three months ended March 31, 2024 and 2023, respectively. A portion of depreciation expense is included in research, development and engineering expenses.
(3) Included $12 million of costs associated with the divestiture of Atmus for the three months ended March 31, 2023.

A reconciliation of our segment information to the corresponding amounts in the Condensed Consolidated Statements of Net Income is shown in the table below:

	Three months ended
	March 31,
In millions	2024			2023
TOTAL SEGMENT EBITDA	$	1,317		$	1,424
Intersegment eliminations and other (1)	1,255		(2)	(63)		(3)
Less:
Interest expense	89			87
Depreciation and amortization	262			245
INCOME BEFORE INCOME TAXES	$	2,221		$	1,029
(1) Included intersegment sales, intersegment profit in inventory and unallocated corporate expenses.
(2) Included $1.3 billion of gain related the divestiture of Atmus and $14 million of costs associated with the divestiture of Atmus (included in corporate expenses) for the three months ended March 31, 2024. See NOTE 14, "ATMUS DIVESTITURE," for additional information.
(3) Included $6 million of costs associated with the divestiture of Atmus for the three months ended March 31, 2023.

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RECENTLY ADOPTED AND RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

3 Months Ended

Mar. 31, 2024

Accounting Standards Update and Change in Accounting Principle [Abstract]

RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS

NOTE 16. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In November 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures," to enhance disclosures for significant segment expenses for all public entities required to report segment information in accordance with ASC 280. The standard did not change the definition of a segment, the method for determining segments or the criteria for aggregating operating segments into reportable segments. The amendments are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Retrospective adoption is required for all prior periods presented in the financial statements. We plan to adopt the standard beginning with our 2024 Form 10-K. The adoption is not expected to have a material impact to our financial statements or disclosures.

In December 2023, the FASB issued ASU 2023-09, "Income Taxes (Topic 740): Improvements in Income Tax Disclosures," to enhance the transparency and decision usefulness of income tax disclosures. This amendment requires public companies to disclose specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. Additionally, under the amendment entities are required to disclose the amount of income taxes paid disaggregated by federal, state and foreign taxes, as well as disaggregated by material individual jurisdictions. Finally, the amendment requires entities to disclose income from continuing operations before income tax expense disaggregated between domestic and foreign and income tax expense from continuing operations disaggregated by federal, state and foreign. The new rules are effective for annual periods beginning after December 15, 2024. We will adopt this standard on a prospective basis as allowed by the standard beginning with our 2025 Form 10-K. The adoption of this standard is not expected to have a material impact on our Condensed Consolidated Financial Statements.

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SUBSEQUENT EVENTS

3 Months Ended

Mar. 31, 2024

Subsequent Events [Abstract]

Subsequent Events

NOTE 17. SUBSEQUENT EVENTS

Early Settlement of Interest Rate Swaps and Early Debt Payments

In April 2024, we settled a portion of our 2023 interest rate swaps with a notional amount of $100 million in conjunction with repayment of $100 million of our term loan, due 2025. The loss on settlement recognized was immaterial.

Issuance of Commercial Paper

In April 2024, we issued approximately $1.0 billion of commercial paper in anticipation of paying the substantial majority of payments required under the Settlement Agreements in May 2024. See NOTE 11, “COMMITMENTS AND CONTINGENCIES,” for additional information on the Settlement Agreements.

Net Investment Hedge

In April 2024, we entered into additional net investments hedges with a notional amount of $250 million where we agreed with third parties to sell Chinese renminbi in exchange for U.S. dollar currency at a specified rate at the maturity of the contract.

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Insider Trading Arrangements	3 Months Ended
	Mar. 31, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

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NATURE OF OPERATIONS AND BASIS OF PRESENTATION (Tables)

3 Months Ended

Mar. 31, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Options excluded from diluted earnings per share

The options excluded from diluted earnings per share were as follows:

 

	Three months ended
	March 31,
	2024	2023
Options excluded	3,600	4,833

Schedule of Related Party Transactions

The following is a summary of sales to and purchases from nonconsolidated equity investees:

	Three months ended
	March 31,
In millions	2024		2023
Sales to nonconsolidated equity investees	$	351	$	376
Purchases from nonconsolidated equity investees	653		704

The following is a summary of accounts receivable from and accounts payable to nonconsolidated equity investees:

In millions	March 31, 2024		December 31, 2023		Balance Sheet Location
Accounts receivable from nonconsolidated equity investees	$	425	$	530	Accounts and notes receivable, net
Accounts payable to nonconsolidated equity investees	325		324		Accounts payable (principally trade)

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REVENUE RECOGNITION LONGTERM CONTRACTS AND DEFERRED AND UNBILLED REVENUE (Tables)

3 Months Ended

Mar. 31, 2024

Revenue from Contract with Customer [Abstract]

Contract with Customer, Contract Asset, Contract Liability, and Receivable

The following is a summary of our unbilled and deferred revenue and related activity:

In millions	March 31, 2024		December 31, 2023
Unbilled revenue	$	330	$	303
Deferred revenue	2,297		2,186

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REVENUE RECOGNITION DISAGGREGATION OF REVENUES (Tables)

3 Months Ended

Mar. 31, 2024

Disaggregation of Revenue [Line Items]

Revenue from External Customers by Geographic Areas

The table below presents our consolidated sales by geographic area. Net sales attributed to geographic areas were based on the location of the customer.

	Three months ended
	March 31,
In millions	2024		2023
United States	$	4,785	$	4,802
China	723		790
India	444		411
Other international	2,451		2,450
Total net sales	$	8,403	$	8,453

Components

Disaggregation of Revenue [Line Items]

Revenue from External Customers by Products and Services

Components segment external sales by business were as follows:

	Three months ended
	March 31,
In millions	2024			2023
Axles and brakes	$	1,232		$	1,272
Emission solutions	856			939
Atmus	289		(1)	342
Engine components	271			292
Automated transmissions	165			178
Software and electronics	29			20
Total sales	$	2,842		$	3,043
(1) Included sales through the March 18, 2024, divestiture. See NOTE 14, "ATMUS DIVESTITURE," for additional information.

Engine

Disaggregation of Revenue [Line Items]

Revenue from External Customers by Market

Engine segment external sales by market were as follows:

	Three months ended
	March 31,
In millions	2024		2023
Heavy-duty truck	$	811	$	860
Medium-duty truck and bus	738		617
Light-duty automotive	438		441
Total on-highway	1,987		1,918
Off-highway	253		334
Total sales	$	2,240	$	2,252

Distribution

Disaggregation of Revenue [Line Items]

Revenue from External Customers by Geographic Areas

Distribution segment external sales by region were as follows:

	Three months ended
	March 31,
In millions	2024		2023
North America	$	1,722	$	1,693
Asia Pacific	285		239
Europe	240		194
China	100		101
India	69		57
Latin America	59		53
Africa and Middle East	54		62
Total sales	$	2,529	$	2,399

Revenue from External Customers by Products and Services

Distribution segment external sales by product line were as follows:

	Three months ended
	March 31,
In millions	2024		2023
Parts	$	997	$	1,052
Power generation	705		491
Engines	422		456
Service	405		400
Total sales	$	2,529	$	2,399

Power Systems

Disaggregation of Revenue [Line Items]

Revenue from External Customers by Products and Services

Power Systems segment external sales by product line were as follows:

	Three months ended
	March 31,
In millions	2024		2023
Power generation	$	360	$	380
Industrial	238		189
Generator technologies	110		110
Total sales	$	708	$	679

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PENSION AND OTHER POSTRETIREMENT BENEFITS (Tables)

3 Months Ended

Mar. 31, 2024

Retirement Benefits [Abstract]

Schedule Benefit Plans Disclosures Cash Contributions

Contributions to these plans were as follows:

	Three months ended
	March 31,
In millions	2024		2023
Defined benefit pension contributions	$	39	$	88
OPEB payments, net	9		4
Defined contribution pension plans	48		43

Components of net periodic pension and other postretirement benefit cost

The components of net periodic pension and OPEB expense (income) under our plans were as follows:

	Pension
	U.S. Plans				U.K. Plans				OPEB
	Three months ended March 31,
In millions	2024		2023		2024		2023		2024		2023
Service cost	$	35	$	29	$	4	$	4	$	—	$	—
Interest cost	42		42		18		17		2		2
Expected return on plan assets	(72)		(69)		(25)		(25)		—		—
Recognized net actuarial loss (gain)	3		2		3		—		(1)		(1)
Net periodic benefit expense (income)	$	8	$	4	$	—	$	(4)	$	1	$	1

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EQUITY, ROYALTY AND INTEREST INCOME FROM INVESTEES (Tables)

3 Months Ended

Mar. 31, 2024

Equity Method Investments and Joint Ventures [Abstract]

Equity, royalty and interest income from investees

Equity, royalty and interest income from investees included in our Condensed Consolidated Statements of Net Income for the reporting period was as follows:

	Three months ended
	March 31,
In millions	2024		2023
Manufacturing entities
Dongfeng Cummins Engine Company, Ltd.	$	22	$	19
Chongqing Cummins Engine Company, Ltd.	15		9
Beijing Foton Cummins Engine Co., Ltd.	13		16
Tata Cummins, Ltd.	9		8
All other manufacturers	23		19
Distribution entities
Komatsu Cummins Chile, Ltda.	13		14
All other distributors	5		3
Cummins share of net income	100		88
Royalty and interest income	23		31
Equity, royalty and interest income from investees	$	123	$	119

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MARKETABLE SECURITIES (Tables)

3 Months Ended

Mar. 31, 2024

Investments, Debt and Equity Securities [Abstract]

Summary of marketable securities

A summary of marketable securities, all of which were classified as current, was as follows:

	March 31, 2024						December 31, 2023
In millions	Cost		Gross unrealized gains/(losses) (1)		Estimated fair value		Cost		Gross unrealized gains/(losses) (1)		Estimated fair value
Equity securities
Certificates of deposit	$	245	$	—	$	245	$	246	$	—	$	246
Debt mutual funds	225		(1)		224		272		—		272
Equity mutual funds	21		7		28		22		6		28
Debt securities	13		—		13		16		—		16
Marketable securities	$	504	$	6	$	510	$	556	$	6	$	562
(1) Unrealized gains and losses for debt securities are recorded in other comprehensive income while unrealized gains and losses for equity securities are recorded in our Condensed Consolidated Statements of Net Income.

Schedule of proceeds from sales and maturities

The proceeds from sales and maturities of marketable securities were as follows:

	Three months ended
	March 31,
In millions	2024		2023
Proceeds from sales of marketable securities	$	426	$	276
Proceeds from maturities of marketable securities	5		69
Investments in marketable securities - liquidations	$	431	$	345

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INVENTORIES (Tables)

3 Months Ended

Mar. 31, 2024

Inventory Disclosure [Abstract]

Inventories

Inventories included the following:

 

In millions	March 31, 2024		December 31, 2023
Finished products	$	2,931	$	2,770
Work-in-process and raw materials	3,049		3,156
Inventories at FIFO cost	5,980		5,926
Excess of FIFO over LIFO	(222)		(249)
Inventories	$	5,758	$	5,677

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SUPPLEMENTAL BALANCE SHEET DATA (Tables)

3 Months Ended

Mar. 31, 2024

Balance Sheet Related Disclosures [Abstract]

Schedule of Other Assets

Other assets included the following:

In millions	March 31, 2024		December 31, 2023
Deferred income taxes	$	950	$	1,082
Operating lease assets	455		501
Corporate owned life insurance	419		417
Other	550		543
Other assets	$	2,374	$	2,543

Accrued Expenses

Other accrued expenses included the following:

In millions	March 31, 2024		December 31, 2023
Settlement Agreements (1)	$	1,938	$	1,938
Income taxes payable	361		242
Marketing accruals	340		399
Other taxes payable	222		296
Current portion of operating lease liabilities	129		138
Other	707		741
Other accrued expenses	$	3,697	$	3,754
(1) See NOTE 11, "COMMITMENTS AND CONTINGENCIES," for additional information.

Other Noncurrent Liabilities

Other liabilities included the following:

In millions	March 31, 2024		December 31, 2023
Accrued product warranty (1)	$	816	$	777
Pensions	495		530
Deferred income taxes	355		530
Operating lease liabilities	332		374
Accrued compensation	186		213
Mark-to-market valuation on interest rate derivatives	124		117
Other postretirement benefits	123		131
Long-term income taxes	111		111
Other	666		647
Other liabilities	$	3,208	$	3,430
(1) See NOTE 10, "PRODUCT WARRANTY LIABILITY," for additional information.

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DEBT (Tables)

3 Months Ended

Mar. 31, 2024

Debt Disclosure [Abstract]

Schedule of Short-term Debt

Loans payable, commercial paper and the related weighted-average interest rates were as follows:

In millions	March 31, 2024		December 31, 2023
Loans payable (1)	$	342	$	280
Commercial paper (2)	609		1,496
(1) Loans payable consist primarily of notes payable to various domestic and international financial institutions. It is not practicable to aggregate these notes and calculate a quarterly weighted-average interest rate.
(2) The weighted-average interest rate, inclusive of all brokerage fees, was 5.23 percent and 5.43 percent at March 31, 2024, and December 31, 2023, respectively.

Summary of long-term debt

A summary of long-term debt was as follows:

In millions	Interest Rate	March 31, 2024		December 31, 2023
Long-term debt
Hydrogenics promissory notes, due 2024 and 2025	—%	$	160	$	160
Term loan, due 2025 (1) (2)	Variable	500		1,150
Senior notes, due 2025 (3)	0.75%	500		500
Atmus term loan, due 2027 (4)	Variable	—		600
Debentures, due 2027	6.75%	58		58
Debentures, due 2028	7.125%	250		250
Senior notes, due 2029	4.90%	500		—
Senior notes, due 2030 (3)	1.50%	850		850
Senior notes, due 2034	5.15%	750		—
Senior notes, due 2043	4.875%	500		500
Senior notes, due 2050	2.60%	650		650
Senior notes, due 2054	5.45%	1,000		—
Debentures, due 2098 (5)	5.65%	165		165
Other debt		90		94
Unamortized discount and deferred issuance costs		(100)		(72)
Fair value adjustments due to hedge on indebtedness		(111)		(96)
Finance leases		122		111
Total long-term debt		5,884		4,920
Less: Current maturities of long-term debt		113		118
Long-term debt		$	5,771	$	4,802
(1) During the first three months of 2024, we paid down $650 million of the term loan.
(2) In 2023, we entered into a series of interest rate swaps in order to trade a portion of the floating rate debt into fixed rate. See "Interest Rate Risk" in NOTE 13, "DERIVATIVES," for additional information.
(3) In 2021, we entered into a series of interest rate swaps to effectively convert debt from a fixed rate to floating rate. See "Interest Rate Risk" in NOTE 13, "DERIVATIVES," for additional information.
(4) See NOTE 14, "ATMUS DIVESTITURE," for additional information.
(5) The effective interest rate is 7.48 percent.

On February 20, 2024, we issued $2.25 billion aggregate principal amount of senior unsecured notes consisting of $500 million aggregate principal amount of 4.90 percent senior unsecured notes due in 2029, $750 million aggregate principal amount of 5.15 percent senior unsecured notes due in 2034 and $1.0 billion aggregate principal amount of 5.45 percent senior unsecured notes due in 2054. We received net proceeds of $2.2 billion. The senior unsecured notes pay interest semi-annually on February 20 and August 20, commencing on August 20, 2024. The indenture governing the senior unsecured notes contains covenants that, among other matters, limit (i) our ability to consolidate or merge into, or sell, assign, convey, lease, transfer or otherwise dispose of all or substantially all of our and our subsidiaries' assets to another person, (ii) our and certain of our subsidiaries' ability to create or assume liens and (iii) our and certain of our subsidiaries' ability to engage in sale and leaseback transactions.

Principal repayments on long-term debt

Principal payments required on long-term debt during the next five years are as follows:

In millions	2024		2025		2026		2027		2028
Principal payments	$	101	$	1,128	$	41	$	76	$	267

Fair value and carrying value of total debt

Based on borrowing rates currently available to us for bank loans with similar terms and average maturities, considering our risk premium, the fair values and carrying values of total debt, including current maturities, were as follows:

 

In millions	March 31, 2024		December 31, 2023
Fair value of total debt (1)	$	6,491	$	6,375
Carrying value of total debt	6,835		6,696
(1) The fair value of debt is derived from Level 2 input measures.

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PRODUCT WARRANTY LIABILITY (Tables)

3 Months Ended

Mar. 31, 2024

Product Warranties Disclosures [Abstract]

Summary of activity in the product warranty account

A tabular reconciliation of the product warranty liability, including the deferred revenue related to our extended warranty coverage and accrued product campaigns, was as follows:

	Three months ended
	March 31,
In millions	2024		2023
Balance at beginning of year	$	2,497	$	2,477
Provision for base warranties issued	160		146
Deferred revenue on extended warranty contracts sold	96		102
Provision for product campaigns issued	6		6
Payments made during period	(176)		(143)
Amortization of deferred revenue on extended warranty contracts	(77)		(75)
Changes in estimates for pre-existing product warranties and campaigns	51		10
Foreign currency translation adjustments and other	(18)		7
Balance at end of period	$	2,539	$	2,530

Warranty related deferred revenue and the long-term portion of the warranty liability

Warranty related deferred revenues and warranty liabilities on our Condensed Consolidated Balance Sheets were as follows:

In millions	March 31, 2024		December 31, 2023		Balance Sheet Location
Deferred revenue related to extended coverage programs
Current portion	$	274	$	279	Current portion of deferred revenue
Long-term portion	797		774		Deferred revenue
Total	$	1,071	$	1,053
Product warranty
Current portion	$	652	$	667	Current portion of accrued product warranty
Long-term portion	816		777		Other liabilities
Total	$	1,468	$	1,444
Total warranty accrual	$	2,539	$	2,497

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables)

3 Months Ended

Mar. 31, 2024

Equity [Abstract]

Changes in accumulated other comprehensive loss by component

Following are the changes in accumulated other comprehensive income (loss) by component for the three months ended:

In millions	Change in pension and OPEB plans		Foreign currency translation adjustment			Unrealized gain (loss) on derivatives		Total attributable to Cummins Inc.		Noncontrolling interests		Total
Balance at December 31, 2023	$	(848)	$	(1,457)		$	99	$	(2,206)
Other comprehensive income (loss) before reclassifications
Before-tax amount	(21)		(116)			22		(115)		$	(3)	$	(118)
Tax expense	3		(2)			(5)		(4)		—		(4)
After-tax amount	(18)		(118)			17		(119)		(3)		(122)
Amounts reclassified from accumulated other comprehensive income (loss) (1)	5		61		(2)	(5)		61		—		61
Net current period other comprehensive (loss) income	(13)		(57)			12		(58)		$	(3)	$	(61)
Balance at March 31, 2024	$	(861)	$	(1,514)		$	111	$	(2,264)
Balance at December 31, 2022	$	(427)	$	(1,552)		$	89	$	(1,890)
Other comprehensive income (loss) before reclassifications
Before-tax amount	(13)		75			(3)		59		$	3	$	62
Tax benefit	2		4			1		7		—		7
After-tax amount	(11)		79			(2)		66		3		69
Amounts reclassified from accumulated other comprehensive income (loss) (1)	2		—			(1)		1		—		1
Net current period other comprehensive (loss) income	(9)		79			(3)		67		$	3	$	70
Balance at March 31, 2023	$	(436)	$	(1,473)		$	86	$	(1,823)
(1) Amounts are net of tax. Reclassifications out of accumulated other comprehensive income (loss) and the related tax effects are immaterial for separate disclosure.
(2) Primarily related to the divestiture of Atmus. See NOTE 14, "ATMUS DIVESTITURE," for additional information.

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DERIVATIVES (Tables)

3 Months Ended

Mar. 31, 2024

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Instruments, Effect on Other Comprehensive Income (Loss)

The following table summarizes the net investment hedge activity in accumulated other comprehensive loss (AOCL):

	Three months ended
	March 31,
In millions	2024				2023
Type of Derivative	Gain (Loss)  Recognized in AOCL		Gain (Loss) Reclassified from AOCL into Earnings		Gain (Loss)  Recognized in AOCL		Gain (Loss) Reclassified from AOCL into Earnings
Foreign exchange forwards	$	6	$	—	$	(15)	$	—

The following table summarizes the interest rate swap activity in AOCL:

	Three months ended
	March 31,
In millions	2024
Type of Swap	Gain (Loss)  Recognized in AOCL		Gain (Loss) Reclassified from AOCL into Interest Expense
Interest rate swaps	$	3	$	—

Schedule of Interest Rate Derivatives

The following table summarizes the gains and losses:

	Three months ended
	March 31,
In millions	2024				2023
Type of Swap	Gain (Loss)  on Swaps		Gain (Loss) on Borrowings		Gain (Loss)  on Swaps		Gain (Loss) on Borrowings
Interest rate swaps (1)	$	(10)	$	14	$	27	$	(22)
(1) The difference between the gain (loss) on swaps and borrowings represents hedge ineffectiveness.

Derivatives Not Designated as Hedging Instruments

The following table summarizes the effect on our Condensed Consolidated Statements of Net Income for derivative instruments not designated as hedging instruments:

	Three months ended
	March 31,
In millions	2024		2023
Loss recognized in income - Cost of sales (1)	$	—	$	(2)
(Loss) gain recognized in income - Other income (expense), net (1)	(40)		27
(1) Includes foreign currency forward contracts.

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

The following table summarizes the location and fair value of derivative instruments on our Condensed Consolidated Balance Sheets:

	Derivatives Designated as Hedging Instruments				Derivatives Not Designated as Hedging Instruments
In millions	March 31, 2024		December 31, 2023		March 31, 2024		December 31, 2023
Notional amount	$	3,257	$	2,997	$	4,064	$	3,610
Derivative assets
Prepaid expenses and other current assets (1)	$	21	$	14	$	9	$	16
Derivative liabilities
Other accrued expenses	$	4	$	43	$	8	$	14
Other liabilities	124		117		11		—
Total derivative liabilities (1)	$	128	$	160	$	19	$	14
(1) Estimates of the fair value of all derivative assets and liabilities above are derived from Level 2 inputs, which are estimated using actively quoted prices for similar instruments from brokers and observable inputs where available, including market transactions and third-party pricing services, or net asset values provided to investors. We do not currently have any Level 3 input measures and there were no transfers into or out of Level 2 or 3 during the three months ended March 31, 2024, or the year ended December 31, 2023.

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OPERATING SEGMENTS (Tables)

3 Months Ended

Mar. 31, 2024

Segment Reporting [Abstract]

Financial information regarding reportable operating segments

Summarized financial information regarding our reportable operating segments for the three months ended is shown in the table below:

In millions	Components			Engine		Distribution		Power Systems		Accelera		Total Segments
Three months ended March 31, 2024
External sales	$	2,842		$	2,240	$	2,529	$	708	$	84	$	8,403
Intersegment sales	490			688		6		681		9		1,874
Total sales	3,332			2,928		2,535		1,389		93		10,277
Research, development and engineering expenses	84			154		14		60		55		367
Equity, royalty and interest income (loss) from investees	26			57		24		19		(3)		123
Interest income	8			7		11		3		—		29
Segment EBITDA	473		(1)	414		294		237		(101)		1,317
Depreciation and amortization (2)	125			58		31		34		14		262
Three months ended March 31, 2023
External sales	$	3,043		$	2,252	$	2,399	$	679	$	80	$	8,453
Intersegment sales	514			734		7		664		5		1,924
Total sales	3,557			2,986		2,406		1,343		85		10,377
Research, development and engineering expenses	91			134		14		63		48		350
Equity, royalty and interest income (loss) from investees	21			65		24		13		(4)		119
Interest income	6			3		7		2		—		18
Segment EBITDA	507		(3)	457		335		219		(94)		1,424
Depreciation and amortization (2)	123			51		28		29		14		245
(1) Included $21 million costs associated with the divestiture of Atmus for the three months ended March 31, 2024. See NOTE 14, "ATMUS DIVESTITURE," for additional information.
(2) Depreciation and amortization, as shown on a segment basis, excludes the amortization of debt discount and deferred costs included in the Condensed Consolidated Statements of Net Income as interest expense. The amortization of debt discount and deferred costs was $3 million and $1 million for the three months ended March 31, 2024 and 2023, respectively. A portion of depreciation expense is included in research, development and engineering expenses.
(3) Included $12 million of costs associated with the divestiture of Atmus for the three months ended March 31, 2023.

Reconciliation of segment information

A reconciliation of our segment information to the corresponding amounts in the Condensed Consolidated Statements of Net Income is shown in the table below:

	Three months ended
	March 31,
In millions	2024			2023
TOTAL SEGMENT EBITDA	$	1,317		$	1,424
Intersegment eliminations and other (1)	1,255		(2)	(63)		(3)
Less:
Interest expense	89			87
Depreciation and amortization	262			245
INCOME BEFORE INCOME TAXES	$	2,221		$	1,029
(1) Included intersegment sales, intersegment profit in inventory and unallocated corporate expenses.
(2) Included $1.3 billion of gain related the divestiture of Atmus and $14 million of costs associated with the divestiture of Atmus (included in corporate expenses) for the three months ended March 31, 2024. See NOTE 14, "ATMUS DIVESTITURE," for additional information.
(3) Included $6 million of costs associated with the divestiture of Atmus for the three months ended March 31, 2023.

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NATURE OF OPERATIONS AND BASIS OF PRESENTATION (Details) $ in Millions	3 Months Ended
	Mar. 31, 2024 USD ($) location country shares	Mar. 31, 2023 USD ($) shares	Mar. 18, 2024 Rate	Dec. 31, 2023 USD ($)
Nature of Operations [Line Items]
Company Owned and Independent Distributor Locations Number | location	450
Countries and Territories Number | country	190
Options excluded (in shares) | shares	3,600	4,833
NET SALES (Notes 1 and 2)	$ 8,403	$ 8,453
Accounts and notes receivable, net	5,463			$ 5,583
Accounts payable (principally trade)	4,476			4,260
Supply Chain Financing, Program Maximum	512
SupplierFinanceProgramObligationCurrent	193			199
Atmus Filtration Technologies Inc.
Nature of Operations [Line Items]
Subsidiary, Ownership Percentage, Parent | Rate			80.50%
Related Party
Nature of Operations [Line Items]
NET SALES (Notes 1 and 2)	351	376
Related Party Transaction, Purchases from Related Party	653	$ 704
Accounts and notes receivable, net	425			530
Accounts payable (principally trade)	$ 325			$ 324
Minimum
Nature of Operations [Line Items]
Dealer Locations Number | location	19,000
Supplier Finance Program, Payment Timing, Period	60 days
Maximum
Nature of Operations [Line Items]
Supplier Finance Program, Payment Timing, Period	90 days

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REVENUE RECOGNITION LONGTERM CONTRACTS AND DEFERRED AND UNBILLED REVENUE (Details 1) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Revenue from Contract with Customer [Abstract]
Revenue, Remaining Performance Obligation, Amount	$ 3,100
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Amount	3,100
Unbilled revenue	330		$ 303
Deferred revenue	2,297		$ 2,186
Contract with Customer, Liability, Revenue Recognized	248	$ 206
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-04-01
Revenue from Contract with Customer [Abstract]
Revenue, Remaining Performance Obligation, Amount	1,400
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Amount	$ 1,400
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	12 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-04-01
Revenue from Contract with Customer [Abstract]
Revenue, Remaining Performance Obligation, Amount	$ 1,700
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Amount	$ 1,700
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	10 years

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REVENUE RECOGNITION DISAGGREGATION OF REVENUES (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	$ 8,403	$ 8,453
Axles and brakes (CBU business)
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	1,232	1,272
Emission solutions (CBU business)
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	856	939
Atmus Filtration Technologies Inc.
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	289	342
Engine Components (CBU business)
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	271	292
Automated Transmissions (CBU business)
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	165	178
Software and electronics (CBU business)
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	29	20
Heavy-duty truck (EBU market)
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	811	860
Medium-duty truck and bus (EBU market)
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	738	617
Light-duty automotive (EBU market)
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	438	441
On-highway (EBU market)
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	1,987	1,918
Off-highway (EBU market)
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	253	334
Parts (DBU product line)
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	997	1,052
Power Generation (DBU product line)
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	705	491
Engines (DBU product line)
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	422	456
Service (DBU product line)
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	405	400
Power Generation (PSBU product line)
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	360	380
Industrial (PSBU product line)
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	238	189
Generator technologies (PSBU product line)
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	110	110
Components
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	3,332	3,557
Engine
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	2,928	2,986
Distribution
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	2,535	2,406
Power Systems
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	1,389	1,343
External Sales | Components
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	2,842	3,043
External Sales | Engine
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	2,240	2,252
External Sales | Distribution
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	2,529	2,399
External Sales | Power Systems
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	708	679
UNITED STATES
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	4,785	4,802
CHINA
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	723	790
CHINA | Distribution
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	100	101
INDIA
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	444	411
INDIA | Distribution
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	69	57
OTHER INTERNATIONAL
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	2,451	2,450
NORTH AMERICA | Distribution
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	1,722	1,693
ASIA PACIFIC | Distribution
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	285	239
EUROPE | Distribution
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	240	194
LATIN AMERICA | Distribution
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	59	53
AFRICA AND MIDDLE EAST | Distribution
Disaggregation of Revenue [Line Items]
NET SALES (Notes 1 and 2)	$ 54	$ 62

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PENSION AND OTHER POSTRETIREMENT BENEFITS (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Apr. 01, 2024
Pension and other postretirement benefits
Defined contribution pension plans	$ 48	$ 43
Pension Plan
Pension and other postretirement benefits
Defined Benefit Plan, Plan Assets, Contributions by Employer	39	88
Other Postretirement Benefits Plan
Pension and other postretirement benefits
Defined Benefit Plan, Plan Assets, Contributions by Employer	9	4
Components of Net Periodic Benefit Cost
Service cost	0	0
Interest cost	2	2
Expected return on plan assets	0	0
Recognized net actuarial loss	(1)	(1)
Net periodic benefit cost	1	1
Estimate | Pension Plan
Pension and other postretirement benefits
Defined Benefit Plan, Expected Future Employer Contributions, Remainder of Fiscal Year			$ 29
Net periodic pension cost			$ 34
UNITED STATES | Pension Plan
Components of Net Periodic Benefit Cost
Service cost	35	29
Interest cost	42	42
Expected return on plan assets	(72)	(69)
Recognized net actuarial loss	3	2
Net periodic benefit cost	8	4
UNITED KINGDOM | Pension Plan
Components of Net Periodic Benefit Cost
Service cost	4	4
Interest cost	18	17
Expected return on plan assets	(25)	(25)
Recognized net actuarial loss	3	0
Net periodic benefit cost	$ 0	$ (4)

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EQUITY, ROYALTY AND INTEREST INCOME FROM INVESTEES (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Apr. 01, 2024
Schedule of Equity Method Investments [Line Items]
Equity, royalty and interest income from investees (Note 4)	$ 123	$ 119
Minimum | Estimate
Schedule of Equity Method Investments [Line Items]
Total Investment by All Partners			$ 2,000
Maximum | Estimate
Schedule of Equity Method Investments [Line Items]
Total Investment by All Partners			$ 3,000
Dongfeng Cummins Engine Company Ltd
Schedule of Equity Method Investments [Line Items]
Equity, royalty and interest income from investees (Note 4)	22	19
Chongqing Cummins Engine Company, Ltd.
Schedule of Equity Method Investments [Line Items]
Equity, royalty and interest income from investees (Note 4)	15	9
Beijing Foton Cummins Engine Company
Schedule of Equity Method Investments [Line Items]
Equity, royalty and interest income from investees (Note 4)	13	16
Tata Cummins, Ltd.
Schedule of Equity Method Investments [Line Items]
Equity, royalty and interest income from investees (Note 4)	9	8
All other manufacturers
Schedule of Equity Method Investments [Line Items]
Equity, royalty and interest income from investees (Note 4)	23	19
Komatsu Cummins Chile, Ltda. (Distribution)
Schedule of Equity Method Investments [Line Items]
Equity, royalty and interest income from investees (Note 4)	13	14
All other distributors
Schedule of Equity Method Investments [Line Items]
Equity, royalty and interest income from investees (Note 4)	5	3
Cummin's Share of Equity Earnings
Schedule of Equity Method Investments [Line Items]
Equity, royalty and interest income from investees (Note 4)	$ 100	88
Battery Joint Venture Commitment
Schedule of Equity Method Investments [Line Items]
Equity Method Investment, Ownership Percentage	30.00%
Partners Investment Ownership Percentage	10.00%
Royalty and interest income
Schedule of Equity Method Investments [Line Items]
Equity, royalty and interest income from investees (Note 4)	$ 23	$ 31

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INCOME TAXES (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Income Tax Disclosure [Abstract]
Effective tax rate (as a percent)	8.70%	21.70%
Gain (Loss) on Disposition of Business	$ (1,333)	$ 0
Other Discrete Tax Expenses	$ (21)
Share-Based Payment Arrangement, Expense, Tax Benefit		$ 3

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MARKETABLE SECURITIES (Details) - USD ($) $ in Millions	3 Months Ended		12 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Schedule of Available-for-sale Securities
Debt Securities, Available-for-sale, Amortized Cost	$ 13		$ 16
Debt Securities, Available for sale, Unrealized Gain (Loss)	0		0
Debt Securities, Available-for-sale	13		16
Debt Securities, Trading, and Equity Securities, FV-NI, Cost	504		556
Marketable Securities, Unrealized Gain / (Loss)	6		6
Marketable securities (Note 6)	510		562
Proceeds from Sale of Held-to-maturity Securities	426	$ 276
Proceeds from Maturity of Marketable Securities	5	69
Proceeds from sales and maturities of marketable securities	431	$ 345
Certificates of deposit
Schedule of Available-for-sale Securities
Equity Securities, cost	245		246
Equity Securities, Unrealized Gain (Loss)	0		0
Equity Securities, Fair Value	245		246
Debt Mutual Funds
Schedule of Available-for-sale Securities
Equity Securities, cost	225		272
Equity Securities, Unrealized Gain (Loss)	(1)		0
Equity Securities, Fair Value	224		272
Equity mutual funds
Schedule of Available-for-sale Securities
Equity Securities, cost	21		22
Equity Securities, Unrealized Gain (Loss)	7		6
Equity Securities, Fair Value	$ 28		$ 28
Minimum | Certificates of deposit
Schedule of Available-for-sale Securities
Maturities of Time Deposits, Description	three months
Maximum | Certificates of deposit
Schedule of Available-for-sale Securities
Maturities of Time Deposits, Description	five years

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INVENTORIES (Details) - USD ($) $ in Millions	Mar. 31, 2024	Dec. 31, 2023
Inventory Disclosure [Abstract]
Finished products	$ 2,931	$ 2,770
Work-in-process and raw materials	3,049	3,156
Inventories at FIFO cost	5,980	5,926
Excess of FIFO over LIFO	(222)	(249)
Total inventories	$ 5,758	$ 5,677

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SUPPLEMENTAL BALANCE SHEET DATA (Details) - USD ($) $ in Millions	Mar. 31, 2024	Dec. 31, 2023
Balance Sheet Related Disclosures [Abstract]
Deferred income taxes	$ 950	$ 1,082
Operating lease assets	455	501
Corporate owned life insurance	419	417
Other Assets, Miscellaneous, Noncurrent	550	543
Other assets	2,374	2,543
Loss Contingency, Accrual, Current	1,938	1,938
Income taxes payable	361	242
Marketing accruals	340	399
Other taxes payable	222	296
Current portion of operating lease liabilities	129	138
Other Accrued Liabilities, Current	707	741
Other accrued expenses	3,697	3,754
Long-term portion of accrued product warranty	816	777
Pensions	495	530
Deferred income taxes	355	530
Operating lease liabilities	332	374
Accrued compensation	186	213
Mark-to-market valuation on interest rate derivatives	124	117
Liability, Other Postretirement Defined Benefit Plan	123	131
Long-term income taxes	111	111
Other Accrued Liabilities, Noncurrent	666	647
Other liabilities	$ 3,208	$ 3,430

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DEBT (Details) - USD ($) $ in Millions		3 Months Ended		12 Months Ended
	Feb. 20, 2024	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023	Jun. 05, 2023	Aug. 18, 2021
Debt Instruments
Loans payable		$ 342		$ 280
Commercial paper		609		1,496
Line of Credit Facility, Maximum Borrowing Capacity		4,000
Line of Credit Facility, Remaining Borrowing Capacity		3,400
Unsecured Debt	$ 2,250
Other Long-term Debt		90		94
Unamortized discount and deferred issuance costs		(100)		(72)
Fair value adjustments due to hedge on indebtedness		(111)		(96)
Finance Lease, Liability		122		111
Total long-term debt		5,884		4,920
Current maturities of long-term debt		113		118
Long-term debt		5,771		4,802
Repayment of Long-Term Debt		(748)	$ (142)
Proceeds from Issuance of Debt	$ 2,200
Principal payments
2024		101
2025		1,128
2026		41
2027		76
2028		267
Fair value
Fair value of total debt		6,491		6,375
Carrying value of total debt		6,835		6,696
Hydrogenics promissory notes, due 2024 and 2025
Debt Instruments
Unsecured Debt		160		160
Term loan, due 2025 (1) (2)
Debt Instruments
Unsecured Debt		500		1,150
Repayment of Long-Term Debt		(650)
Senior notes, due 2025 (3)
Debt Instruments
Unsecured Debt		$ 500		500
Debt instrument interest rate (as a percent)		0.75%
Atmus term loan, due 2027 (4)
Debt Instruments
Unsecured Debt				600
Debentures, due 2027
Debt Instruments
Unsecured Debt		$ 58		58
Debt instrument interest rate (as a percent)		6.75%
Debentures, due 2028
Debt Instruments
Unsecured Debt		$ 250		250
Debt instrument interest rate (as a percent)		7.125%
Debentures 4.90 Percent Due 2029
Debt Instruments
Unsecured Debt		$ 500		0
Debt instrument interest rate (as a percent)		4.90%
Senior Notes 1.50 Percent, Due 2030
Debt Instruments
Unsecured Debt		$ 850		850
Debt instrument interest rate (as a percent)		1.50%
Senior Notes 5.15 Percent Due 2034
Debt Instruments
Unsecured Debt		$ 750		0
Debt instrument interest rate (as a percent)		5.15%
Senior notes, due 2043
Debt Instruments
Unsecured Debt		$ 500		500
Debt instrument interest rate (as a percent)		4.875%
Senior notes, due 2050
Debt Instruments
Unsecured Debt		$ 650		650
Debt instrument interest rate (as a percent)		2.60%
Senior Notes 5.45 Percent, Due 2054
Debt Instruments
Unsecured Debt		$ 1,000		0
Debt instrument interest rate (as a percent)		5.45%
Debentures, due 2098 (5)
Debt Instruments
Unsecured Debt		$ 165		$ 165
Effective interest rate (as a percent)		7.48%
Debt instrument interest rate (as a percent)		5.65%
Commercial Paper
Debt Instruments
Weighted Average Interest Rate (as a percent)		5.23%		5.43%
Line of Credit Facility, Maximum Borrowing Capacity		$ 4,000
International and Other Lines of Credit
Debt Instruments
Line of Credit Facility, Remaining Borrowing Capacity		$ 396
1-year revolving credit agreement
Debt Instruments
Line of Credit Facility, Maximum Borrowing Capacity					$ 2,000
5-Year Revolving Credit Facility
Debt Instruments
Line of Credit Facility, Maximum Borrowing Capacity						$ 2,000

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PRODUCT WARRANTY LIABILITY (Details 1) Warranty Footnote Disclosure - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Product Warranties Disclosures [Abstract]
Balance, beginning of year	$ 2,497	$ 2,477
Provision for base warranties issued	160	146
Deferred revenue on extended warranty contracts sold	96	102
Provision for product campaigns issued	6	6
Payments made during period	(176)	(143)
Amortization of deferred revenue on extended warranty contracts	(77)	(75)
Changes in estimates for pre-existing product warranties and campaigns	51	10
Foreign currency translation adjustments and other	(18)	7
Balance, end of period	2,539	2,530
Supplier recoveries	22	$ 10
Product Warranty Liability
Current portion of warranty related deferred revenue	1,236		$ 1,220
Long term portion of warranty related deferred revenue	1,061		966
Deferred Revenue Related to extended coverage, Total	1,071		1,053
Current portion of accrued product warranty	652		667
Long-term portion of accrued product warranty	816		777
Standard Product Warranty Accrual	1,468		1,444
Current portion of deferred revenue
Product Warranty Liability
Current portion of warranty related deferred revenue	274		279
Deferred revenue
Product Warranty Liability
Long term portion of warranty related deferred revenue	797		774
Current portion of accrued product warranty
Product Warranty Liability
Current portion of accrued product warranty	652		667
Other liabilities
Product Warranty Liability
Long-term portion of accrued product warranty	$ 816		$ 777

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COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Millions	3 Months Ended		12 Months Ended
	Mar. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Guarantee Obligations
Loss Contingency, Loss in Period		$ 2,000
Provision for product campaigns issued			$ 59
Guarantor obligations, maximum potential loss	$ 39
Long-term purchase commitment, penalty exposure	584
Total commitments under commodity contracts	64
Performance Bonds and Other Performance Guarantees	$ 192
Maximum
Guarantee Obligations
Guarantor Obligations, Term	two years

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance at the beginning of the period	$ (2,206)
Before tax amount	(118)	$ 62
Tax (expense) benefit	(4)	7
After tax amount	(122)	69
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax	61	1
Net current period other comprehensive (loss) income	(61)	70
Balance at the end of the period	(2,264)
Change in pension and OPEB plans
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance at the beginning of the period	(848)	(427)
Before tax amount	(21)	(13)
Tax (expense) benefit	3	2
After tax amount	(18)	(11)
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax	5	2
Net current period other comprehensive (loss) income	(13)	(9)
Balance at the end of the period	(861)	(436)
Foreign currency translation adjustment
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance at the beginning of the period	(1,457)	(1,552)
Before tax amount	(116)	75
Tax (expense) benefit	(2)	4
After tax amount	(118)	79
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax	61	0
Net current period other comprehensive (loss) income	(57)	79
Balance at the end of the period	(1,514)	(1,473)
Unrealized gain (loss) on derivatives
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance at the beginning of the period	99	89
Before tax amount	22	(3)
Tax (expense) benefit	(5)	1
After tax amount	17	(2)
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax	(5)	(1)
Net current period other comprehensive (loss) income	12	(3)
Balance at the end of the period	111	86
Total attributable to Cummins Inc.
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance at the beginning of the period	(2,206)	(1,890)
Before tax amount	(115)	59
Tax (expense) benefit	(4)	7
After tax amount	(119)	66
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax	61	1
Net current period other comprehensive (loss) income	(58)	67
Balance at the end of the period	(2,264)	(1,823)
Noncontrolling interests
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Before tax amount	(3)	3
Tax (expense) benefit	0	0
After tax amount	(3)	3
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax	0	0
Net current period other comprehensive (loss) income	$ (3)	$ 3

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DERIVATIVES (Details) - USD ($) $ in Millions	3 Months Ended		12 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023	Feb. 20, 2024
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Unsecured Debt				$ 2,250
Gain (Loss) on Swaps	$ (10)	$ 27
Gain (Loss) on Borrowings	14	(22)
Derivative Assets (Liabilities), at Fair Value, Net	13		$ 4
Derivative, Net Liability Position, Aggregate Fair Value	130		148
Designated as Hedging Instrument
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, Notional Amount	3,257		2,997
Derivative Liability	128		160
Not Designated as Hedging Instrument
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, Notional Amount	4,064		3,610
Derivative Liability	19		14
Prepaid Expenses and Other Current Assets | Designated as Hedging Instrument
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative Asset	21		14
Prepaid Expenses and Other Current Assets | Not Designated as Hedging Instrument
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative Asset	9		16
Other accrued expenses | Designated as Hedging Instrument
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative Liability	4		43
Other accrued expenses | Not Designated as Hedging Instrument
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative Liability	8		14
Other liabilities | Designated as Hedging Instrument
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative Liability	124		117
Other liabilities | Not Designated as Hedging Instrument
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative Liability	11		0
Cost of Sales
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net	0	(2)
Other Nonoperating Income (Expense)
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net	(40)	27
Foreign Exchange Forward
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, Notional Amount	$ 5,000		$ 4,500
Foreign Exchange Forward | Foreign currencies | Geographic Concentration Risk
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Concentration Risk, Percentage	86.00%		85.00%
Net Investment Hedging
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, Notional Amount	$ 1,000
Gain (Loss)  Recognized in AOCL	6	(15)
Gain (Loss) Reclassified from AOCL into Earnings	0	$ 0
Interest Rate Swap
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, Notional Amount	500
Gain (Loss)  Recognized in AOCL	3
Gain (Loss) Reclassified from AOCL into Earnings	$ 0
Senior Notes 5.72 Percent, Due in 2025
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, Average Fixed Interest Rate	5.72%
Senior notes, due 2025 (3)
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Unsecured Debt	$ 500		$ 500
Debt instrument interest rate (as a percent)	0.75%
Senior notes, due 2025 (3) | Interest Rate Swap
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, Notional Amount	$ 400
Senior notes, due 2025 (3) | London Interbank Offered Rate
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Debt Instrument, Description of Variable Rate Basis	LIBOR
Senior notes, due 2025 (3) | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Debt Instrument, Description of Variable Rate Basis	SOFR
Senior Notes 1.50 Percent, Due 2030
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Unsecured Debt	$ 850		$ 850
Debt instrument interest rate (as a percent)	1.50%
Senior Notes 1.50 Percent, Due 2030 | Interest Rate Swap
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, Notional Amount	$ 765
Senior Notes 1.50 Percent, Due 2030 | London Interbank Offered Rate
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Debt Instrument, Description of Variable Rate Basis	LIBOR
Senior Notes 1.50 Percent, Due 2030 | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Debt Instrument, Description of Variable Rate Basis	SOFR

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Atmus Divestiture (Details) - USD ($) shares in Millions, $ in Millions		3 Months Ended
	Mar. 18, 2024	Mar. 31, 2024	Mar. 31, 2023	Feb. 20, 2024	Dec. 31, 2023
Noncash or Part Noncash Divestitures [Line Items]
Discount on Exchange Ratio	7.00%
Gain (Loss) on Disposition of Business		$ (1,333)	$ 0
Goodwill		2,406			$ 2,499
Unsecured Debt				$ 2,250
Other comprehensive income, net of tax (Note 12)		(61)	70
Divestiture of Atmus (Note 14)		(1,490)
Transitional Services Agreement, Term	24 years
Noncontrolling Interests
Noncash or Part Noncash Divestitures [Line Items]
Other comprehensive income, net of tax (Note 12)		(3)	$ 3
Divestiture of Atmus (Note 14)		(19)
Atmus term loan, due 2027 (4)
Noncash or Part Noncash Divestitures [Line Items]
Unsecured Debt					$ 600
Rounded Purchase Price Member
Noncash or Part Noncash Divestitures [Line Items]
Gain (Loss) on Disposition of Business		1,300
Atmus Filtration Technologies Inc.
Noncash or Part Noncash Divestitures [Line Items]
Subsidiary, Ownership Percentage, Parent	80.50%
Sale of Stock, Number of Shares Issued in Transaction	67.0
Goodwill	$ 114
Other comprehensive income, net of tax (Note 12)		$ 61
Cummins Inc. [Member]
Noncash or Part Noncash Divestitures [Line Items]
Sale of Stock, Number of Shares Issued in Transaction	5.6

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OPERATING SEGMENTS (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Segment reporting
NET SALES (Notes 1 and 2)	$ 8,403	$ 8,453
Research, development and engineering expenses	369	350
Income (Loss) from Equity Method Investments	123	119
Interest expense	89	87
Depreciation and amortization	262	245
INCOME BEFORE INCOME TAXES	2,221	1,029
Amortization of Debt Discount (Premium)	3	1
Gain (Loss) on Disposition of Business	(1,333)	0
Components
Segment reporting
NET SALES (Notes 1 and 2)	3,332	3,557
Research, development and engineering expenses	84	91
Income (Loss) from Equity Method Investments	26	21
Interest income	8	6
Segment EBITDA	473	507
Depreciation and amortization	125	123
Atmus separation costs	21	12
Engine
Segment reporting
NET SALES (Notes 1 and 2)	2,928	2,986
Research, development and engineering expenses	154	134
Income (Loss) from Equity Method Investments	57	65
Interest income	7	3
Segment EBITDA	414	457
Depreciation and amortization	58	51
Distribution
Segment reporting
NET SALES (Notes 1 and 2)	2,535	2,406
Research, development and engineering expenses	14	14
Income (Loss) from Equity Method Investments	24	24
Interest income	11	7
Segment EBITDA	294	335
Depreciation and amortization	31	28
Power Systems
Segment reporting
NET SALES (Notes 1 and 2)	1,389	1,343
Research, development and engineering expenses	60	63
Income (Loss) from Equity Method Investments	19	13
Interest income	3	2
Segment EBITDA	237	219
Depreciation and amortization	34	29
Accelera
Segment reporting
NET SALES (Notes 1 and 2)	93	85
Research, development and engineering expenses	55	48
Income (Loss) from Equity Method Investments	(3)	(4)
Interest income	0	0
Segment EBITDA	(101)	(94)
Depreciation and amortization	14	14
Total Segments
Segment reporting
NET SALES (Notes 1 and 2)	10,277	10,377
Research, development and engineering expenses	367	350
Income (Loss) from Equity Method Investments	123	119
Interest income	29	18
Segment EBITDA	1,317	1,424
Depreciation and amortization	262	245
Corporate and Other
Segment reporting
Segment EBITDA	1,255	(63)
Atmus separation costs	14	6
Gain (Loss) on Disposition of Business	(1,300)
External Sales | Components
Segment reporting
NET SALES (Notes 1 and 2)	2,842	3,043
External Sales | Engine
Segment reporting
NET SALES (Notes 1 and 2)	2,240	2,252
External Sales | Distribution
Segment reporting
NET SALES (Notes 1 and 2)	2,529	2,399
External Sales | Power Systems
Segment reporting
NET SALES (Notes 1 and 2)	708	679
External Sales | Accelera
Segment reporting
NET SALES (Notes 1 and 2)	84	80
External Sales | Total Segments
Segment reporting
NET SALES (Notes 1 and 2)	8,403	8,453
Intersegment sales | Components
Segment reporting
NET SALES (Notes 1 and 2)	490	514
Intersegment sales | Engine
Segment reporting
NET SALES (Notes 1 and 2)	688	734
Intersegment sales | Distribution
Segment reporting
NET SALES (Notes 1 and 2)	6	7
Intersegment sales | Power Systems
Segment reporting
NET SALES (Notes 1 and 2)	681	664
Intersegment sales | Accelera
Segment reporting
NET SALES (Notes 1 and 2)	9	5
Intersegment sales | Total Segments
Segment reporting
NET SALES (Notes 1 and 2)	$ 1,874	$ 1,924

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RECENTLY ADOPTED AND RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS (Details)	3 Months Ended
	Mar. 31, 2024
Accounting Standards Update 2023-07
Accounting Standards Update and Change in Accounting Principle [Abstract]
New Accounting Pronouncement or Change in Accounting Principle, Description	In November 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures," to enhance disclosures for significant segment expenses for all public entities required to report segment information in accordance with ASC 280. The standard did not change the definition of a segment, the method for determining segments or the criteria for aggregating operating segments into reportable segments. The amendments are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Retrospective adoption is required for all prior periods presented in the financial statements. We plan to adopt the standard beginning with our 2024 Form 10-K. The adoption is not expected to have a material impact to our financial statements or disclosures.
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
New Accounting Pronouncement or Change in Accounting Principle, Description	In November 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures," to enhance disclosures for significant segment expenses for all public entities required to report segment information in accordance with ASC 280. The standard did not change the definition of a segment, the method for determining segments or the criteria for aggregating operating segments into reportable segments. The amendments are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Retrospective adoption is required for all prior periods presented in the financial statements. We plan to adopt the standard beginning with our 2024 Form 10-K. The adoption is not expected to have a material impact to our financial statements or disclosures.
Accounting Standards Update 2023-09
Accounting Standards Update and Change in Accounting Principle [Abstract]
New Accounting Pronouncement or Change in Accounting Principle, Description	In December 2023, the FASB issued ASU 2023-09, "Income Taxes (Topic 740): Improvements in Income Tax Disclosures," to enhance the transparency and decision usefulness of income tax disclosures. This amendment requires public companies to disclose specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. Additionally, under the amendment entities are required to disclose the amount of income taxes paid disaggregated by federal, state and foreign taxes, as well as disaggregated by material individual jurisdictions. Finally, the amendment requires entities to disclose income from continuing operations before income tax expense disaggregated between domestic and foreign and income tax expense from continuing operations disaggregated by federal, state and foreign. The new rules are effective for annual periods beginning after December 15, 2024. We will adopt this standard on a prospective basis as allowed by the standard beginning with our 2025 Form 10-K. The adoption of this standard is not expected to have a material impact on our Condensed Consolidated Financial Statements.
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
New Accounting Pronouncement or Change in Accounting Principle, Description	In December 2023, the FASB issued ASU 2023-09, "Income Taxes (Topic 740): Improvements in Income Tax Disclosures," to enhance the transparency and decision usefulness of income tax disclosures. This amendment requires public companies to disclose specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. Additionally, under the amendment entities are required to disclose the amount of income taxes paid disaggregated by federal, state and foreign taxes, as well as disaggregated by material individual jurisdictions. Finally, the amendment requires entities to disclose income from continuing operations before income tax expense disaggregated between domestic and foreign and income tax expense from continuing operations disaggregated by federal, state and foreign. The new rules are effective for annual periods beginning after December 15, 2024. We will adopt this standard on a prospective basis as allowed by the standard beginning with our 2025 Form 10-K. The adoption of this standard is not expected to have a material impact on our Condensed Consolidated Financial Statements.

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SUBSEQUENT EVENT (Details) - USD ($) $ in Millions			1 Months Ended	3 Months Ended
	Apr. 11, 2024	Apr. 08, 2024	Apr. 30, 2024	Mar. 31, 2024	Mar. 31, 2023
Subsequent Event [Line Items]
Repayment of Long-Term Debt, Long-Term Lease Obligation, and Capital Security				$ 748	$ 142
Proceeds from (Repayments of) Commercial Paper				(887)	$ (29)
Term loan, due 2025 (1) (2)
Subsequent Event [Line Items]
Repayment of Long-Term Debt, Long-Term Lease Obligation, and Capital Security				650
Interest Rate Swap
Subsequent Event [Line Items]
Derivative, Notional Amount				500
Net Investment Hedging
Subsequent Event [Line Items]
Derivative, Notional Amount				$ 1,000
Subsequent Event
Subsequent Event [Line Items]
Proceeds from (Repayments of) Commercial Paper			$ 1,000
Subsequent Event | Term loan, due 2025 (1) (2)
Subsequent Event [Line Items]
Repayment of Long-Term Debt, Long-Term Lease Obligation, and Capital Security	$ 100
Subsequent Event | Interest Rate Swap
Subsequent Event [Line Items]
Derivative, Notional Amount Settled		$ 100
Subsequent Event | Net Investment Hedging
Subsequent Event [Line Items]
Derivative, Notional Amount			$ 250