Cummins (CMI) Risk Factor Changes

We conduct operations in many areas of the world involving transactions denominated in a variety of currencies.

At December 31, 2025, we employed approximately 67,400 persons worldwide.

The markets in which we operate are highly competitive.

We are exposed to political, economic and other risks that arise from operating a multinational business.

If we fail to keep pace with rapidly evolving technological developments in AI, our competitive position and business results may suffer.

We are using AI in our business and in our products, services and features, and challenges with properly managing its use could result in reputational harm, competitive harm and legal liability, and adversely affect o…

If required, the financing for strategic acquisitions could result in an increase in our indebtedness, dilute the interests of our shareholders or both.

services that customers desire and value can mitigate the risks of increasing competition and declining demand, but products and services that are perceived to be less than desirable (whether in terms of price, qualit…

Any of these factors could have a material adverse impact on our results of operations, financial condition and cash flows.

We are investing in new products and technologies, including electrified power systems and related components and subsystems.

The development of new technologies may materially reduce the demand for our current products and services, and we may not be successful in developing new technologies and products in order to effectively address the…

integration, their customers' preferences, their desire for cost reductions, their desire for eliminating production risks and their desire to maintain company focus.

For 2025, we recognized $469 million of equity, royalty and interest income from investees, compared to $395 million in 2024.

Our markets are cyclical in nature and we face periods when demand fluctuates significantly higher or lower than our normal operating levels, including variability driven by supply chain inconsistency.

We continue to experience pockets of supply chain disruptions and related challenges throughout the supply chain which are further impacted by the current global tariff environment.

China, India and Germany.

We operate our business on a global basis and changes in tariffs and other trade disruptions could adversely impact the demand for our products and our competitive position.

Our operations are subject to increasingly stringent environmental laws and regulations in all of the countries in which we operate, including laws and regulations governing air emission, carbon content, discharges to…

Our engines are subject to extensive and evolving statutory and regulatory requirements governing emissions and noise, including standards imposed by the EPA, the EU, state regulatory agencies (such as the CARB) and o…

revenues.

markets.

generating content that appears correct but is factually inaccurate, misleading or otherwise flawed, or that results in unintended biases and discriminatory outcomes, which could harm our stakeholders, our reputation…

We are incorporating AI solutions into our business, products, services and features, and we are leveraging AI, including generative AI, machine learning and similar tools and technologies, in our product development,…

acquisition results in any additional goodwill or increase in other intangible assets on our balance sheet and subsequently becomes impaired, we would be required to record a non-cash impairment charge, which could re…

Although we conduct market research before launching new or refreshed engines and introducing new services, many factors both within and outside our control affect the success of new or existing products and services…

Lower-than-anticipated market acceptance of our new or existing products or services could have a material adverse impact on our results of operations, financial condition and cash flows.

If the energy transition landscape changes faster than anticipated or in a manner that we do not anticipate, demand for our products and services, as well as our relationships with various stakeholders, could be adver…

We recognize significant sales of engines and components to a few large on-highway truck OEM customers, which have been an integral part of our positive business results for several years.

In an effort to limit GHG emissions and combat climate change, multiple countries and cities have announced that they plan to implement a ban on the use in their countries or cities of diesel-powered products in the n…

Any of these outcomes could adversely affect our long-term growth prospects, competitive position and financial results.

Deregulation or reduction in incentives may also lead to reduced industry-wide innovation, as both we and our competitors could deprioritize or delay the introduction of advanced technologies that are no longer mandated.

Our strategy includes significant investments in the development of new products and technologies, particularly those designed to meet or exceed current and anticipated regulatory requirements related to emissions, sa…

Deregulation could impair our investments in future products and negatively impact our long-term growth and competitiveness.

We operate our business on a global basis and changes in international, national and regional trade laws, regulations and policies affecting and/or restricting international trade could adversely impact the demand for…

We manufacture, sell and service products globally and rely upon a global supply chain to deliver the raw materials, components, systems and parts that we need to manufacture and service our products.