Caterpillar, Inc.
CAT · NYSE
Next quarter
Expected to report Jan 28, 2027 — estimated from last year’s reporting date.
Consensus is $7.04 EPS for Dec 2026 across 10 estimates, ranging $5.83 to $8.28.
CAT Sep 2026
- 1.12%
- $7.12
- $7.20
- —
- —
Highlights
- Sales and revenue rose 17% year over year to $20.682 billion, driven by $2.207 billion of higher sales volume and $663 million of favorable price realization.
- Earnings were $7.20 per share adjusted, narrowly above the supplied $7.12 consensus; GAAP diluted EPS was $7.13. Adjusted EPS was $4.95 a year earlier.
- Profitability improved year over year: operating profit increased 38% to $4.214 billion and operating margin rose to 20.4% from 17.3%; adjusted margin was 20.6%.
- Power & Energy sales climbed 18% to $8.784 billion and segment profit rose 31% to $2.143 billion, with power-generation growth led in part by data-center applications.
- Construction Industries sales grew 18% to $7.983 billion and profit increased 33% to $1.831 billion; higher volume and pricing helped offset $252 million of unfavorable manufacturing costs, including freight.
- Resource Industries sales advanced 15% to $4.615 billion, but profit rose a slower 14% to $622 million as $208 million of higher manufacturing costs, primarily materials including tariffs, offset volume and pricing benefits.
- Cash returns and liquidity included $1.2 billion of share repurchases and $0.7 billion of dividends; enterprise operating cash flow was $4.4 billion and quarter-end enterprise cash was $7.9 billion. The CEO cited a record backlog but gave no figure in the release.
- Financial Products revenue increased 9% to $1.177 billion and segment profit rose 10% to $264 million. Past dues improved to 1.31% from 1.47% year over year, while the credit-loss allowance was $332 million, or 0.91% of finance receivables.
Analysis
Caterpillar delivered a strong year-over-year quarter, with sales and revenues of $20.682 billion, up 17%, and adjusted profit per share of $7.20 versus $4.95 a year earlier. The supplied $7.12 EPS consensus was exceeded by about 1.1% using the adjusted result; GAAP diluted EPS was $7.13. Operating profit rose 38% to $4.214 billion and operating margin expanded to 20.4% from 17.3%, reflecting higher volume and pricing across the three main equipment businesses. Sales volume contributed $2.207 billion to the revenue increase, with favorable price realization adding $663 million.
Sequentially, revenue was modestly higher than Q2 FY2026’s $20.54 billion, but GAAP operating income eased from $4.29 billion to $4.214 billion and diluted EPS declined from $7.77 to $7.13. The defining demand story was broad-based segment growth, particularly Power & Energy, where data-center-related turbine and engine demand supported sales; management also pointed to strong orders and a record backlog without quantifying it. Margins and earnings benefited from operating leverage, though tariff-related costs remained visible in Resource Industries and Caterpillar reported $128 million of IEEPA tariff recoveries in operating profit. The company generated $4.4 billion of enterprise operating cash flow and returned $1.9 billion through buybacks and dividends during the quarter.
Sales and operating margin
- Revenue drivers Sales and revenues reached $20.682 billion, up $3.044 billion, or 17%, year over year. Higher sales volume added $2.207 billion, largely from increased equipment sales to end users, while price realization added $663 million.
- Operating leverage Operating profit increased $1.162 billion, or 38%, to $4.214 billion. GAAP operating margin rose 3.1 percentage points to 20.4%; adjusted margin, excluding restructuring costs, was 20.6% versus 17.5% a year earlier.
- Per-share results GAAP profit per share was $7.13, compared with $4.88 a year ago. Adjusted profit per share was $7.20 versus $4.95, excluding restructuring costs of $41 million this quarter and $37 million in the prior-year quarter.
- Sequential context Revenue edged up from $20.54 billion in Q2 FY2026, while operating income moved down from $4.29 billion and diluted EPS from $7.77. The release’s year-over-year comparison is substantially stronger than the sequential change.
Power and Energy
- Segment growth Sales increased 18% to $8.784 billion, including $879 million from higher volume and $216 million from favorable price realization. Segment profit rose 31% to $2.143 billion, and margin expanded to 24.4% from 21.9%.
- Power generation demand Sales in power generation grew 30% to $3.421 billion. Caterpillar attributed growth mainly to turbines and related services and large reciprocating engines, primarily for data-center applications.
- Other applications Oil and gas sales increased 13% to $2.236 billion, supported by reciprocating-engine aftermarket parts, gas-compression engines, and turbine-related sales. Industrial sales rose 4% to $1.631 billion, mainly on higher North American sales.
Construction and Resource
- Construction Industries Sales advanced 18% to $7.983 billion, with $874 million from volume and $349 million from pricing. Profit rose 33% to $1.831 billion and margin improved to 22.9% from 20.4%. Higher end-user equipment sales supported volume; profit growth was partly offset by $252 million of unfavorable manufacturing costs, including higher freight.
- Regional construction demand North American sales rose 23% to $4.796 billion and Latin American sales increased 26% to $825 million. EAME grew 12% to $1.366 billion, while Asia/Pacific was up 2% to $925 million.
- Resource Industries Sales increased 15% to $4.615 billion, led by Mining, Heavy Construction and Quarry & Aggregates, up 22% to $3.697 billion. Segment profit grew 14% to $622 million, but margin slipped to 13.5% from 13.6%. Higher volume and pricing were partly offset by $208 million of unfavorable manufacturing costs, primarily higher materials including tariffs.
Financial Products
- Revenue and profit Segment revenue rose 9% to $1.177 billion, primarily because higher average earning assets added $125 million, partly offset by $38 million from lower average financing rates. Profit increased 10% to $264 million, with higher earning assets contributing $52 million and higher credit-loss provisions reducing results by $34 million.
- Credit metrics Past dues were 1.31% at quarter-end versus 1.47% a year earlier. Net write-offs declined to $28 million from $40 million. The allowance for credit losses was $332 million, or 0.91% of finance receivables, compared with $294 million, or 0.84%, at June 30, 2026.
Cash and capital returns
- Quarterly cash and returns Enterprise operating cash flow was $4.4 billion. Caterpillar ended September with $7.9 billion of enterprise cash and deployed $1.2 billion for share repurchases and $0.7 billion for dividends.
- Nine-month cash generation Consolidated operating cash flow was $10.593 billion for the first nine months of 2026, versus $8.148 billion in the prior-year period. Over that span, the company paid $7.745 billion to repurchase shares and $2.148 billion in dividends.
- Demand commentary CEO Joe Creed described order rates as strong and the backlog as record, while the release supplied no backlog amount or formal outlook figures.
