EXHIBIT 99

For Immediate Release

October 27, 2020

Cummins Reports Third Quarter 2020 Results

•Third quarter revenues of $5.1 billion; GAAP¹ Net Income of $501 million

•Third quarter EBITDA of 17.1 percent; Diluted EPS of $3.36

•The company produced record quarterly operating cash flow of $1.2 billion

•Total liquidity increased to $6.5 billion, including cash and marketable securities of $3.3 billion

COLUMBUS, IND. - Cummins Inc. (NYSE: CMI) today reported results for the third quarter of 2020.

Third quarter revenues of $5.1 billion decreased 11 percent from the same quarter in 2019. Sales in North America declined by 18 percent while international revenues were flat. Currency negatively impacted revenues by 1 percent primarily due to a weaker Brazilian Real.

Earnings before interest, taxes, depreciation and amortization (EBITDA) in the third quarter were $876 million (17.1 percent of sales), compared to $958 million (16.6 percent of sales) a year ago.

“Cummins successfully translated increased sales into strong profits and produced record operating cash flow during the third quarter” said Chairman and CEO Tom Linebarger. “I want to thank our employees all over the globe once again for their dedication to our company and to our customers. Over the last six months we have faced both the most severe decline in quarterly sales in our history as well as the largest sequential increase. We continue to work safely and effectively through an incredibly challenging period, meeting our commitments to customers who provide products critical to the functioning of the global economy.”

Net income attributable to Cummins in the third quarter was $501 million ($3.36 per diluted share) compared to $622 million ($3.97 per diluted share) in 2019. The tax rate in the third quarter was 26.5 percent and was negatively impacted by $31 million ($0.21 per diluted share) of discrete tax items.

“We continue to advance existing products and invest in new technology while returning cash to shareholders,” said Chief Financial Officer Mark Smith. “In October we announced a 3% increase to our quarterly dividend, which will make 2020 the eleventh consecutive year of increases to Cummins’ dividend.”

2020 Outlook:

The company currently expects fourth quarter revenues to be similar to third quarter levels, with higher demand in North America truck markets and continued improvement in aftermarket sales, partially offset by lower demand in China.

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On October 1^st, the company ended temporary salary reductions that began in April. Compensation expense is projected to increase by approximately $90 million dollars in the fourth quarter due to the end of these salary reductions.

“We are encouraged by the recovery in demand across our markets in the third quarter,” said Chairman and CEO Tom Linebarger. “We will continue to manage cautiously through the remainder of the year as visibility on future orders remains low and the impact of the virus on economies around the world remains difficult to predict.”

Third Quarter 2020 Highlights:

•The company completed an aggregate $2 billion debt offering of 5, 10, and 30-year maturities. The company’s long-term credit ratings remain unchanged at A+ from Standard & Poor’s and A2 from Moody’s with stable outlooks

•A collaboration with the Department of Energy’s Oak Ridge National Laboratory (ORNL) has resulted in the ability to produce enough filter media to supply more than a million face masks and respirators per day to U.S. healthcare facilities

•Cummins was awarded over $12 million of funding for five separate Department of Energy projects related to PEM and Solid Oxide fuel cell and electrolyzer technologies

•The company announced an increase in its quarterly dividend from $1.311 to $1.35 a share

Third quarter 2020 detail (all comparisons to same period in 2019):

Engine Segment

•Sales - $2.1 billion, down 13 percent

•Segment EBITDA - $382 million, or 18.1 percent of sales, compared to $341 million or 14.1 percent of sales

•EBITDA was positively impacted by a $30 million value added tax (VAT) recovery

•On-highway revenues decreased 13 percent and off-highway revenues declined 9 percent

•Sales declined by 18 percent in North America but increased 8 percent in international markets primarily due to increased demand in China

Distribution Segment

•Sales - $1.7 billion, down 14 percent

•Segment EBITDA - $182 million, or 10.6 percent of sales, compared to $186 million or 9.3 percent of sales

•Revenues in North America were down 18 percent and international sales declined by 5 percent

•Demand declined in all lines of business

Components Segment

•Sales - $1.5 billion, down 7 percent

•Segment EBITDA - $261 million, or 16.9 percent of sales, compared to $286 million or 17.3 percent of sales

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•Revenues in North America decreased by 24 percent and international sales increased by 26 percent due to higher demand in China and India

Power Systems Segment

•Sales - $981 million, down 13 percent

•Segment EBITDA - $101 million, or 10.3 percent of sales, compared to $158 million, or 14.0 percent of sales

•Power generation revenues decreased by 7 percent while industrial revenues decreased 21 percent due to lower demand in mining and oil and gas markets

New Power Segment

•Sales - $18 million

•Segment EBITDA loss - $40 million

•Costs associated with the development of fuel cells and electrolyzers as well as products to support battery electric vehicles are contributing to EBITDA losses

¹ Generally Accepted Accounting Principles

About Cummins Inc.

Cummins Inc., a global power leader, is a corporation of complementary business segments that design, manufacture, distribute and service a broad portfolio of power solutions. The company’s products range from diesel, natural gas, electric and hybrid powertrains and powertrain-related components including filtration, aftertreatment, turbochargers, fuel systems, controls systems, air handling systems, automated transmissions, electric power generation systems, batteries, electrified power systems, hydrogen generation and fuel cell products. Headquartered in Columbus, Indiana (U.S.), since its founding in 1919, Cummins employs approximately 61,600 people committed to powering a more prosperous world through three global corporate responsibility priorities critical to healthy communities: education, environment and equality of opportunity. Cummins serves its customers online, through a network of company-owned and independent distributor locations, and through thousands of dealer locations worldwide and earned about $2.3 billion on sales of $23.6 billion in 2019. See how Cummins is powering a world that’s always on by accessing news releases and more information at https://www.cummins.com/always-on.

Forward-looking disclosure statement

Information provided in this release that is not purely historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our forecasts, guidance, preliminary results, expectations, hopes, beliefs and intentions on strategies regarding the future. These forward-looking statements include, without limitation, statements relating to our plans and expectations for our revenues and EBITDA. Our actual future results could differ materially from those projected in such forward-looking statements because of a number of factors, including, but not limited to: market slowdown due to the impacts from COVID-19 pandemic, other public health crises, epidemics or pandemics; impacts to manufacturing and supply chain abilities from an extended shutdown or disruption of our operations due to the COVID-19 pandemic; supply shortages and supplier financial risk, particularly from any of our single-sourced suppliers, including suppliers that may be impacted by the COVID-19 pandemic; aligning our capacity and production with our demand, including impacts of COVID-19; a major customer experiencing financial distress, particularly related to the COVID-19 pandemic; any adverse results of our internal review into our emissions certification process and compliance with emission standards; increased scrutiny from regulatory agencies, as well as unpredictability in the adoption, implementation and enforcement of emission standards around the world; disruptions in global credit and financial markets as the result of the COVID-19 pandemic; adverse impacts from government actions to stabilize credit markets and financial institutions and other industries; product recalls; the development of new technologies that reduce demand for our current products and services; policy changes in international trade; a slowdown in infrastructure development and/or depressed commodity prices; the U.K.'s exit from the European Union (EU); labor relations or work stoppages; reliance on our executive leadership team and other key personnel; lower than expected acceptance of new or existing products or services; changes in the engine outsourcing practices of significant customers;

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our plan to reposition our portfolio of product offerings through exploration of strategic acquisitions and divestitures and related uncertainties of entering such transactions; exposure to potential security breaches or other disruptions to our information technology systems and data security; challenges or unexpected costs in completing cost reduction actions and restructuring initiatives; failure to realize expected results from our investment in Eaton Cummins Automated Transmission Technologies joint venture; political, economic and other risks from operations in numerous countries; competitor activity; increasing competition, including increased global competition among our customers in emerging markets; foreign currency exchange rate changes; variability in material and commodity costs; the actions of, and income from, joint ventures and other investees that we do not directly control; changes in taxation; global legal and ethical compliance costs and risks; product liability claims; increasingly stringent environmental laws and regulations; the performance of our pension plan assets and volatility of discount rates, particularly those related to the sustained slowdown of the global economy due to the COVID-19 pandemic; future bans or limitations on the use of diesel-powered products; the price and availability of energy; our sales mix of products; protection and validity of our patent and other intellectual property rights; the outcome of pending and future litigation and governmental proceedings; 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 risks detailed from time to time in our SEC filings, including particularly in the Risk Factors section of our 2019 Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. 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 press release and we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. More detailed information about factors that may affect our performance may be found in our filings with the SEC, which are available at http://www.sec.gov or at http://www.cummins.com in the Investor Relations section of our website.

Presentation of Non-GAAP Financial Information

EBITDA is a non-GAAP measure used in this release and is defined and reconciled to what management believes to be the most comparable GAAP measure in a schedule attached to this release. Cummins presents this information as it believes it is useful to understanding the Company's operating performance, and because EBITDA is a measure used internally to assess the performance of the operating units.

Webcast information

Cummins management will host a teleconference to discuss these results today at 10 a.m. EST. This teleconference will be webcast and available on the Investor Relations section of the Cummins website at www.cummins.com. Participants wishing to view the visuals available with the audio are encouraged to sign-in a few minutes prior to the start of the teleconference.

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CUMMINS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF NET INCOME

(Unaudited) (a)

						Three months ended
In millions, except per share amounts						September 27, 2020						June 28, 2020						September 29, 2019
NET SALES						$	5,118					$	3,852					$	5,768
Cost of sales						3,769						2,962						4,274
GROSS MARGIN						1,349						890						1,494
OPERATING EXPENSES AND INCOME
Selling, general and administrative expenses						533						470						600
Research, development and engineering expenses						224						189						242
Equity, royalty and interest income from investees						98						115						68
Other operating expense, net						(20)						(10)						(21)
OPERATING INCOME						670						336						699
Interest income						4						4						14
Interest expense						25						23						26
Other income, net						37						45						68
INCOME BEFORE INCOME TAXES						686						362						755
Income tax expense						182						93						139
CONSOLIDATED NET INCOME						504						269						616
Less: Net income (loss) attributable to noncontrolling interests						3						(7)						(6)
NET INCOME ATTRIBUTABLE TO CUMMINS INC.						$	501					$	276					$	622
EARNINGS PER COMMON SHARE ATTRIBUTABLE TO CUMMINS INC.
Basic						$	3.39					$	1.87					$	3.99
Diluted						$	3.36					$	1.86					$	3.97
WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING
Basic						147.9						147.6						155.9
Diluted						148.9						148.0						156.6
(a)  Prepared on an unaudited basis in accordance with accounting principles generally accepted in the United States of America.

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CUMMINS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF NET INCOME

(Unaudited) (a)

									Nine months ended
			In millions, except per share amounts						September 27, 2020												September 29, 2019
			NET SALES						$	13,981											$	17,993
			Cost of sales						10,448												13,326
			GROSS MARGIN						3,533												4,667
			OPERATING EXPENSES AND INCOME
			Selling, general and administrative expenses						1,549												1,822
			Research, development and engineering expenses						651												730
			Equity, royalty and interest income from investees						342												256
			Other operating expense, net						(35)												(25)
			OPERATING INCOME						1,640												2,346
			Interest income						15												38
			Interest expense						71												87
			Other income, net						119												174
			INCOME BEFORE INCOME TAXES						1,703												2,471
			Income tax expense						402												501
			CONSOLIDATED NET INCOME						1,301												1,970
			Less: Net income attributable to noncontrolling interests						13												10
			NET INCOME ATTRIBUTABLE TO CUMMINS INC.						$	1,288											$	1,960
			EARNINGS PER COMMON SHARE ATTRIBUTABLE TO CUMMINS INC.
			Basic						$	8.69											$	12.50
			Diluted						$	8.65											$	12.45
			WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING
			Basic						148.3												156.8
			Diluted						148.9												157.4
			(a)  Prepared on an unaudited basis in accordance with accounting principles generally accepted in the United States of America.

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CUMMINS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited) (a)

In millions, except par value						September 27, 2020						December 31, 2019
ASSETS
Current assets
Cash and cash equivalents						$	2,967					$	1,129
Marketable securities						345						341
Total cash, cash equivalents and marketable securities						3,312						1,470
Accounts and notes receivable, net						3,628						3,670
Inventories						3,470						3,486
Prepaid expenses and other current assets						652						761
Total current assets						11,062						9,387
Long-term assets
Property, plant and equipment, net						4,087						4,245
Investments and advances related to equity method investees						1,418						1,237
Goodwill						1,288						1,286
Other intangible assets, net						990						1,003
Pension assets						1,010						1,001
Other assets						1,713						1,578
Total assets						$	21,568					$	19,737
LIABILITIES
Current liabilities
Accounts payable (principally trade)						$	2,597					$	2,534
Loans payable						129						100
Commercial paper						316						660
Accrued compensation, benefits and retirement costs						433						560
Current portion of accrued product warranty						646						803
Current portion of deferred revenue						540						533
Other accrued expenses						990						1,039
Current maturities of long-term debt						58						31
Total current liabilities						5,709						6,260
Long-term liabilities
Long-term debt						3,609						1,576
Pensions and other postretirement benefits						571						591
Accrued product warranty						635						645
Deferred revenue						837						821
Other liabilities						1,566						1,379
Total liabilities						$	12,927					$	11,272
EQUITY
Cummins Inc. shareholders’ equity
Common stock, $2.50 par value, 500 shares authorized, 222.5 and 222.4 shares issued						$	2,385					$	2,346
Retained earnings						15,118						14,416
Treasury stock, at cost, 74.4 and 71.7 shares						(7,696)						(7,225)
Common stock held by employee benefits trust, at cost, 0.0 and 0.2 shares						—						(2)
Accumulated other comprehensive loss						(2,107)						(2,028)
Total Cummins Inc. shareholders’ equity						7,700						7,507
Noncontrolling interests						941						958
Total equity						$	8,641					$	8,465
Total liabilities and equity						$	21,568					$	19,737
(a) Prepared on an unaudited basis in accordance with accounting principles generally accepted in the United States of America.

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CUMMINS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited) (a)

						Three months ended
In millions						September 27, 2020						June 28, 2020						September 29, 2019
CASH FLOWS FROM OPERATING ACTIVITIES
Consolidated net income						$	504					$	269					$	616
Adjustments to reconcile consolidated net income to net cash provided by (used in) operating activities
Depreciation and amortization						166						165						178
Deferred income taxes						4						—						(31)
Equity in income of investees, net of dividends						(12)						(46)						(1)
Pension and OPEB expense						27						27						19
Pension contributions and OPEB payments						(20)						(22)						(38)
Stock-based compensation expense						10						8						9
Restructuring payments						(19)						(33)						—
Gain on corporate owned life insurance						(12)						(21)						(9)
Foreign currency remeasurement and transaction exposure						(5)						(5)						(100)
Changes in current assets and liabilities, net of acquisitions
Accounts and notes receivable						(123)						63						211
Inventories						174						(53)						63
Other current assets						(22)						16						33
Accounts payable						329						(391)						(151)
Accrued expenses						186						(101)						120
Changes in other liabilities						9						171						48
Other, net						27						(69)						156
Net cash provided by (used in) operating activities						1,223						(22)						1,123
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures						(116)						(77)						(153)
Investments in internal use software						(12)						(13)						(16)
Investments in and advances to equity investees						(13)						(10)						2
Acquisitions of businesses, net of cash acquired						—						—						(222)
Investments in marketable securities—acquisitions						(137)						(169)						(108)
Investments in marketable securities—liquidations						154						159						143
Cash flows from derivatives not designated as hedges						7						(28)						(60)
Other, net						14						3						(4)
Net cash used in investing activities						(103)						(135)						(418)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from borrowings						1,977						22						—
Net (payments) borrowings of commercial paper						(1,711)						410						468
Payments on borrowings and finance lease obligations						(16)						(15)						(30)
Net borrowings (payments) under short-term credit agreements						2						(21)						(4)
Distributions to noncontrolling interests						(13)						—						(20)
Dividend payments on common stock						(194)						(193)						(204)
Repurchases of common stock						—						—						(706)
Other, net						59						23						9
Net cash provided by (used in) financing activities						104						226						(487)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS						(8)						(9)						(55)
Net increase in cash and cash equivalents						1,216						60						163
Cash and cash equivalents at beginning of period						1,751						1,691						1,397
CASH AND CASH EQUIVALENTS AT END OF PERIOD						$	2,967					$	1,751					$	1,560
(a)  Prepared on an unaudited basis in accordance with accounting principles generally accepted in the United States of America.

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CUMMINS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited) (a)

						Nine months ended
In millions						September 27, 2020						September 29, 2019
CASH FLOWS FROM OPERATING ACTIVITIES
Consolidated net income						$	1,301					$	1,970
Adjustments to reconcile consolidated net income to net cash provided by operating activities
Depreciation and amortization						499						493
Deferred income taxes						(7)						(14)
Equity in income of investees, net of dividends						(136)						(44)
Pension and OPEB expense						81						56
Pension contributions and OPEB payments						(102)						(130)
Stock-based compensation expense						22						37
Restructuring payments						(100)						—
Gain on corporate owned life insurance						(50)						(64)
Foreign currency remeasurement and transaction exposure						(7)						(54)
Changes in current assets and liabilities, net of acquisitions
Accounts and notes receivable						47						(101)
Inventories						(50)						(62)
Other current assets						73						48
Accounts payable						109						(3)
Accrued expenses						(236)						(74)
Changes in other liabilities						208						168
Other, net						(72)						117
Net cash provided by operating activities						1,580						2,343
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures						(268)						(395)
Investments in internal use software						(33)						(50)
Investments in and advances to equity investees						(30)						(16)
Acquisitions of businesses, net of cash acquired						—						(237)
Investments in marketable securities—acquisitions						(422)						(367)
Investments in marketable securities—liquidations						408						296
Cash flows from derivatives not designated as hedges						(15)						(86)
Other, net						23						26
Net cash used in investing activities						(337)						(829)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from borrowings						1,999						10
Net (payments) borrowings of commercial paper						(344)						122
Payments on borrowings and finance lease obligations						(41)						(47)
Net borrowings under short-term credit agreements						6						53
Distributions to noncontrolling interests						(26)						(33)
Dividend payments on common stock						(582)						(562)
Repurchases of common stock						(550)						(806)
Other, net						102						65
Net cash provided by (used in) financing activities						564						(1,198)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS						31						(59)
Net increase in cash and cash equivalents						1,838						257
Cash and cash equivalents at beginning of year						1,129						1,303
CASH AND CASH EQUIVALENTS AT END OF PERIOD						$	2,967					$	1,560
(a)  Prepared on an unaudited basis in accordance with accounting principles generally accepted in the United States of America.

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CUMMINS INC. AND SUBSIDIARIES

SEGMENT INFORMATION

(Unaudited)

			In millions						Engine						Distribution						Components						Power Systems						New Power						Total Segments						Intersegment Eliminations (1)						Total
			Three months ended September 27, 2020
			External sales						$	1,617					$	1,715					$	1,201					$	567					$	18					$	5,118					$	—					$	5,118
			Intersegment sales						495						6						340						414						—						1,255						(1,255)						—
			Total sales						2,112						1,721						1,541						981						18						6,373						(1,255)						5,118
			Research, development and engineering expenses						72						9						64						53						26						224						—						224
			Equity, royalty and interest income (loss) from investees						74						13						13						—						(2)						98						—						98
			Interest income						1						1						1						1						—						4						—						4
			EBITDA (2)						382						182						261						101						(40)						886						(10)						876
			Depreciation and amortization (3)						51						30						47						32						5						165						—						165
			EBITDA as a percentage of total sales						18.1		%				10.6		%				16.9		%				10.3		%				NM						13.9		%										17.1		%
			Three months ended September 29, 2019
			External sales						$	1,822					$	2,001					$	1,253					$	683					$	9					$	5,768					$	—					$	5,768
			Intersegment sales						594						3						397						443						—						1,437						(1,437)						—
			Total sales						2,416						2,004						1,650						1,126						9						7,205						(1,437)						5,768
			Research, development and engineering expenses						79						7						73						58						25						242						—						242
			Equity, royalty and interest income from investees						34						12						9						13						—						68						—						68
			Interest income						5						4						2						3						—						14						—						14
			EBITDA (2)						341						186						286						158						(36)						935						23						958
			Depreciation and amortization (3)						50						29						67						29						2						177						—						177
			EBITDA as a percentage of total sales						14.1		%				9.3		%				17.3		%				14.0		%				NM						13.0		%										16.6		%
			"NM" - not meaningful information
			(1) Includes intersegment sales, intersegment profit in inventory eliminations and unallocated corporate expenses. There were no significant unallocated corporate expenses for the three months ended September 27, 2020 and September 29, 2019.
			(2) EBITDA is defined as earnings or losses before interest expense, income taxes, depreciation and amortization and noncontrolling interests.
			(3) 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." A portion of depreciation expense is included in "Research, development and engineering expenses."

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CUMMINS INC. AND SUBSIDIARIES

SEGMENT INFORMATION

(Unaudited)

			In millions						Engine						Distribution						Components						Power Systems						New Power						Total Segments						Intersegment Eliminations (1)						Total
			Nine months ended September 27, 2020
			External sales						$	4,133					$	5,123					$	3,192					$	1,495					$	38					$	13,981					$	—					$	13,981
			Intersegment sales						1,560						17						1,001						1,147						—						3,725						(3,725)						—
			Total sales						5,693						5,140						4,193						2,642						38						17,706						(3,725)						13,981
			Research, development and engineering expenses						217						20						187						148						79						651						—						651
			Equity, royalty and interest income (loss) from investees						236						45						46						18						(3)						342						—						342
			Interest income						6						3						3						3						—						15						—						15
			EBITDA (2)						897						500						681						269						(121)						2,226						45						2,271
			Depreciation and amortization (3)						155						91						142						96						13						497						—						497
			EBITDA as a percentage of total sales						15.8		%				9.7		%				16.2		%				10.2		%				NM						12.6		%										16.2		%
			Nine months ended September 29, 2019
			External sales						$	5,879					$	6,009					$	4,055					$	2,030					$	20					$	17,993					$	—					$	17,993
			Intersegment sales						1,893						24						1,302						1,376						—						4,595						(4,595)						—
			Total sales						7,772						6,033						5,357						3,406						20						22,588						(4,595)						17,993
			Research, development and engineering expenses						245						21						223						171						70						730						—						730
			Equity, royalty and interest income from investees						152						35						30						39						—						256						—						256
			Interest income						13						12						6						7						—						38						—						38
			EBITDA (2)						1,195						529						908						469						(98)						3,003						46						3,049
			Depreciation and amortization (3)						151						86						160						88						6						491						—						491
			EBITDA as a percentage of total sales						15.4		%				8.8		%				16.9		%				13.8		%				NM						13.3		%										16.9		%
			"NM" - not meaningful information
			(1) Includes intersegment sales, intersegment profit in inventory eliminations and unallocated corporate expenses. There were no significant unallocated corporate expenses for the nine months ended September 27, 2020 and September 29, 2019.
			(2) EBITDA is defined as earnings or losses before interest expense, income taxes, depreciation and amortization and noncontrolling interests.
			(3) 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 $2 million and $2 million for the nine months ended September 27, 2020 and September 29, 2019, respectively. A portion of depreciation expense is included in "Research, development and engineering expense."

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CUMMINS INC. AND SUBSIDIARIES

RECONCILIATION OF SEGMENT INFORMATION

(Unaudited)

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																								Nine months ended
In millions						September 27, 2020												September 29, 2019						September 27, 2020						September 29, 2019
Total EBITDA						$	876											$	958					$	2,271					$	3,049
Less:
Depreciation and amortization						165												177						497						491
Interest expense						25												26						71						87
Income before income taxes						$	686											$	755					$	1,703					$	2,471

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CUMMINS INC. AND SUBSIDIARIES

SELECT FOOTNOTE DATA

(Unaudited)

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 periods was as follows:

						Three months ended																								Nine months ended
In millions						September 27, 2020												September 29, 2019						September 27, 2020						September 29, 2019
Manufacturing entities
Beijing Foton Cummins Engine Co., Ltd.						$	30											$	15					$	81					$	56
Dongfeng Cummins Engine Company, Ltd.						20												10						54						40
Chongqing Cummins Engine Company, Ltd.						7												10						27						32
All other manufacturers						22									(1)			21						100			(1)(2)			76
Distribution entities
Komatsu Cummins Chile, Ltda.						6												6						23						19
All other distributors						1												1						1						—
Cummins share of net income						86												63						286						223
Royalty and interest income						12												5						56						33
Equity, royalty and interest income from investees						$	98											$	68					$	342					$	256
(1) Includes impairment charges of $10 million and $13 million for the three and nine months ended September 27, 2020, respectively, for a joint venture in the Power Systems segment.
(2) Includes $37 million in adjustments related to tax changes within India's 2020-2021 Union Budget of India (India Tax Law Changes) passed in March 2020.

INCOME TAXES

Our effective tax rates for the three and nine months ended September 27, 2020, were 26.5 percent and 23.6 percent, respectively.

The three months ended September 27, 2020, contained unfavorable discrete items of $31 million, or $0.21 per share, consisting of $17 million of changes in tax reserves, $8 million of provision to return adjustments relating to tax returns filed for 2019 and $6 million of net other discrete items.

The nine months ended September 27, 2020, contained $27 million, or $0.18 per share, of unfavorable net discrete tax items, primarily due to $34 million of unfavorable changes in tax reserves and $8 million of provision to return adjustments, partially offset by $15 million of favorable tax changes within India's 2020-2021 Union Budget of India (India Tax Law Change) passed in March of 2020. The India Tax Law Change eliminated the dividend distribution tax and replaced it with a lower rate withholding tax as the burden shifted from the dividend payor to the dividend recipient for a net favorable income statement impact of $35 million.

The India Tax Law Change resulted in the following adjustments to the Condensed Consolidated Statements of Net Income in the first nine months of 2020:

In millions																		Favorable (Unfavorable)
Equity, royalty and interest income from investees																		$	37
Income tax expense (1)																		17
Less: Net income attributable to noncontrolling interests																		(19)
Net income statement impact																		$	35
(1) The adjustment to "Income tax expense" includes $15 million of discrete items.

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CUMMINS INC. AND SUBSIDIARIES

SELECT FOOTNOTE DATA

(Unaudited)

AVAILABLE LIQUIDITY AND CREDIT RATINGS

Available Liquidity

Cash provided by operations is typically our principal source of liquidity with $1,580 million generated in the nine months ended September 27, 2020. Our sources of liquidity include:

						September 27, 2020
In millions						Total						U.S.						International						Primary location of international balances
Cash and cash equivalents						$	2,967					$	1,793					$	1,174					China, Mexico, Singapore, Belgium, Australia, Netherlands, Canada
Marketable securities (1)						345						75						270						India
Total						$	3,312					$	1,868					$	1,444
Available credit capacity
Revolving credit facilities (2)						$	3,184
International and other uncommitted domestic credit facilities						$	191
(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 $1.5 billion, maturing August 2023 and August 2021, respectively, are maintained primarily to provide backup liquidity for our commercial paper borrowings and general corporate purposes. At September 27, 2020, we had $316 million of commercial paper outstanding, which effectively reduced the available capacity under our revolving credit facilities to $3.2 billion.

Credit Ratings

In August of 2020, concurrent with our new $2 billion debt issuance, both Standard and Poor's Rating Services and Moody's Investors Service, Inc. reviewed and reaffirmed their respective credit rating and stable outlook. 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.

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CUMMINS INC. AND SUBSIDIARIES

FINANCIAL MEASURES THAT SUPPLEMENT GAAP

(Unaudited)

Reconciliation of Non GAAP measures - Earnings before interest, income taxes, depreciation and amortization and noncontrolling interests (EBITDA)

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.

EBITDA is not in accordance with, or an alternative for, accounting principles generally accepted in the United States (GAAP) and may not be consistent with measures used by other companies. It should be considered supplemental data; however, the amounts included in the EBITDA calculation are derived from amounts included in the Condensed Consolidated Statements of Net Income. Below is a reconciliation of “Net income attributable to Cummins Inc.” to EBITDA for each of the applicable periods:

						Three months ended																														Nine months ended
In millions						September 27, 2020						June 28, 2020						September 29, 2019						September 27, 2020						September 29, 2019
Net income attributable to Cummins Inc.						$	501					$	276					$	622					$	1,288					$	1,960
Net income attributable to Cummins Inc. as a percentage of net sales						9.8		%				7.2		%				10.8		%				9.2		%				10.9		%
Add:
Net income (loss) attributable to noncontrolling interests						3						(7)						(6)						13						10
Consolidated net income						504						269						616						1,301						1,970
Add:
Interest expense						25						23						26						71						87
Income tax expense						182						93						139						402						501
Depreciation and amortization						165						164						177						497						491
EBITDA						$	876					$	549					$	958					$	2,271					$	3,049
EBITDA as a percentage of net sales						17.1		%				14.3		%				16.6		%				16.2		%				16.9		%

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CUMMINS INC. AND SUBSIDIARIES

BUSINESS UNIT SALES DATA

(Unaudited)

Engine Segment Sales by Market and Unit Shipments by Engine Classification

Sales for our Engine segment by market were as follows:

2020
In millions						Q1						Q2						Q3						Q4						YTD
Heavy-duty truck						$	750					$	415					$	694					$	—					$	1,859
Medium-duty truck and bus						618						391						492						—						1,501
Light-duty automotive						353						180						522						—						1,055
Off-highway						437						437						404						—						1,278
Total sales						$	2,158					$	1,423					$	2,112					$	—					$	5,693
2019
In millions						Q1						Q2						Q3						Q4						YTD
Heavy-duty truck						$	979					$	970					$	851					$	755					$	3,555
Medium-duty truck and bus						721						739						645						602						2,707
Light-duty automotive						382						480						478						464						1,804
Off-highway						571						514						442						463						1,990
Total sales						$	2,653					$	2,703					$	2,416					$	2,284					$	10,056

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

2020
Units						Q1						Q2						Q3						Q4						YTD
Heavy-duty						25,800						15,900						23,300						—						65,000
Medium-duty						61,200						44,900						50,100						—						156,200
Light-duty						49,400						29,800						67,200						—						146,400
Total units						136,400						90,600						140,600						—						367,600
2019
Units						Q1						Q2						Q3						Q4						YTD
Heavy-duty						33,900						35,000						28,000						25,700						122,600
Medium-duty						79,000						76,400						63,200						64,800						283,400
Light-duty						56,400						64,100						62,600						62,800						245,900
Total units						169,300						175,500						153,800						153,300						651,900

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CUMMINS INC. AND SUBSIDIARIES

BUSINESS UNIT SALES DATA

(Unaudited)

Distribution Segment Sales by Product Line

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

2020
In millions						Q1						Q2						Q3						Q4						YTD
Parts						$	787					$	654					$	722					$	—					$	2,163
Power generation						376						377						416						—						1,169
Service						328						297						304						—						929
Engines						323						277						279						—						879
Total sales						$	1,814					$	1,605					$	1,721					$	—					$	5,140
2019
In millions						Q1						Q2						Q3						Q4						YTD
Parts						$	844					$	833					$	798					$	815					$	3,290
Power generation						403						427						467						487						1,784
Service						363						373						376						367						1,479
Engines						391						395						363						369						1,518
Total sales						$	2,001					$	2,028					$	2,004					$	2,038					$	8,071

Component Segment Sales by Product Line

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

2020
In millions						Q1						Q2						Q3						Q4						YTD
Emission solutions						$	664					$	472					$	665					$	—					$	1,801
Filtration						312						255						314						—						881
Turbo technologies						270						216						281						—						767
Electronics and fuel systems						174						164						187						—						525
Automated transmissions						82						43						94						—						219
Total sales						$	1,502					$	1,150					$	1,541					$	—					$	4,193
2019
In millions						Q1						Q2						Q3						Q4						YTD
Emission solutions						$	854					$	828					$	745					$	695					$	3,122
Filtration						325						331						310						315						1,281
Turbo technologies						335						319						279						285						1,218
Electronics and fuel systems						198						212						170						179						759
Automated transmissions						149						156						146						83						534
Total sales						$	1,861					$	1,846					$	1,650					$	1,557					$	6,914

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CUMMINS INC. AND SUBSIDIARIES

BUSINESS UNIT SALES DATA

(Unaudited)

Power Systems Segment Sales by Product Line and Unit Shipments by Engine Classification

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

2020
In millions						Q1						Q2						Q3						Q4						YTD
Power generation						$	519					$	424					$	601					$	—					$	1,544
Industrial						296						291						309						—						896
Generator technologies						69						62						71						—						202
Total sales						$	884					$	777					$	981					$	—					$	2,642
2019
In millions						Q1						Q2						Q3						Q4						YTD
Power generation						$	567					$	668					$	647					$	636					$	2,518
Industrial						420						432						392						332						1,576
Generator technologies						90						103						87						86						366
Total sales						$	1,077					$	1,203					$	1,126					$	1,054					$	4,460

High-horsepower unit shipments by engine classification were as follows:

2020
Units						Q1						Q2						Q3						Q4						YTD
Power generation						1,800						1,000						2,300						—						5,100
Industrial						1,000						1,000						1,200						—						3,200
Total units						2,800						2,000						3,500						—						8,300
2019
Units						Q1						Q2						Q3						Q4						YTD
Power generation						2,100						2,300						2,300						2,400						9,100
Industrial						1,600						1,600						1,400						1,400						6,000
Total units						3,700						3,900						3,700						3,800						15,100

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