Caterpillar posts Q3 revenue beat even as tariffs weigh
By Josh White
Date: Wednesday 29 Oct 2025
(Sharecast News) - Caterpillar reported third-quarter revenue of $17.6bn on Wednesday, up 10% year on year and ahead of market expectations, as higher end-user equipment sales lifted all three primary segments.
Profit per share was $4.88, with adjusted earnings per share of $4.95, down from $5.17 a year earlier but about 9% above consensus.
Operating margins narrowed to 17.3% from 19.5% a year ago, or to 17.5% on an adjusted basis compared to 20%, reflecting higher costs and a higher effective tax rate.
"Solid performance from our team generated strong results this quarter, driven by resilient demand and focused execution across our three primary segments," said CEO Joe Creed.
"Our team's continued discipline in a dynamic environment, coupled with a growing backlog, positions us for sustained momentum and long-term profitable growth."
Segment trends were mixed; construction industries sales rose 7% to $6.8bn but segment profit fell 7% to $1.38bn, while resource industries sales edged up 2% to $3.1bn with profit down 19% to $499m, as tariffs and pricing weighed on profitability.
Energy and transportation remained the growth engine, with sales up 17% to $8.4bn and profit up 17% to $1.68bn, benefiting from strong power generation demand tied to data-center build-outs.
On a prior call, Creed noted power generation sales to end-users grew 19%, "driven by increasing energy demands to support data center growth, related to cloud computing and generative AI."
Cash generation stayed robust - enterprise operating cash flow was $3.7bn, and Caterpillar ended the quarter with $7.5bn of enterprise cash.
The company returned $1.1bn to shareholders through $0.7bn of dividends and $0.4bn of buybacks in the quarter.
Management said full-year revenue should be "modestly higher" than 2024 but warned tariff headwinds would intensify, with net tariff costs guided at $400m to $500m for the third quarter, and $650m to $800m for the fourth, taking the full-year tariff impact to an additional $1.6bn to $1.75bn versus prior expectations of $1.3bn to $1.5bn.
Order momentum remained firm, with the backlog increasing by $2.3bn in the quarter to a record $39.8bn.
At 1019 EDT (1419 GMT), shares in Caterpillar were up 11.69% in New York at $585.77.
Reporting by Josh White for Shaercast.com.
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