CMI · 10-Q · 2026Q2 · Full report

Trade Policy and Tariffs

CUMMINS INC · 2026-08-04 · Importance 44 · Surprise 60

Cummins reported that the U.S. imposed tariffs on certain countries and products in 2025, followed by retaliatory tariffs and other trade actions against U.S. goods and services. On February 20, 2026, the U.S. Supreme Court ruled that tariffs imposed under the International Emergency Economic Powers Act on goods imported into the U.S. were unauthorized, after which new tariffs were imposed under different statutes. Tariffs, embargoes, sanctions, export controls and geopolitical tensions may reduce freight activity, increase supplier and end-user costs, and weaken demand. Net tariff costs after mitigation and U.S. government refunds were immaterial to profitability and operating cash flows for the three and six months ended June 30, 2026, but Cummins warned that increasing costs and volatility could materially affect future results.

Key facts

• The net impact of tariffs, net of mitigation actions and U.S. government tariff refunds, was immaterial to profitability and operating cash flows during the three and six months ended June 30, 2026 source