Caterpillar Reports Third-Quarter 2025 Results

IRVING, Texas, Oct. 29, 2025 /PRNewswire/ -- Caterpillar Inc. (NYSE: CAT) announced third-quarter 2025 results.

"Solid performance from our team generated strong results this quarter, driven by resilient demand and focused execution across our three primary segments," said Caterpillar 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."

Sales and revenues for the third quarter of 2025 were $17.6 billion, a 10% increase compared with $16.1 billion in the third quarter of 2024. The increase was primarily due to higher sales volume. Higher sales volume was mainly driven by higher sales of equipment to end users.

Operating profit margin was 17.3% for the third quarter of 2025, compared with 19.5% for the third quarter of 2024. Adjusted operating profit margin was 17.5% for the third quarter of 2025, compared with 20.0% for the third quarter of 2024. Third-quarter 2025 profit per share was $4.88, compared with third-quarter 2024 profit per share of $5.06. Adjusted profit per share in the third quarter of 2025 was $4.95, compared with third-quarter 2024 adjusted profit per share of $5.17. Third-quarter 2025 profit per share of $4.88 reflected an increase in the estimated global annual effective tax rate to 24.0%, and a net discrete tax charge in the quarter. For the third quarter of 2025 and 2024, adjusted operating profit margin and adjusted profit per share excluded restructuring costs.

For the third quarter of 2025, enterprise operating cash flow was $3.7 billion, and the company ended the third quarter with $7.5 billion of enterprise cash. In the quarter, the company deployed $0.7 billion of cash for dividends and $0.4 billion of cash for repurchases of Caterpillar common stock.

CONSOLIDATED RESULTS

Consolidated Sales and Revenues

Consolidated Sales and Revenues Comparison
Third Quarter 2025 vs. Third Quarter 2024  

To access this chart, go to https://investors.caterpillar.com/financials/quarterly-results/default.aspx for the downloadable version of Caterpillar third-quarter 2025 earnings

The chart above graphically illustrates reasons for the change in consolidated sales and revenues between the third quarter of 2024 (at left) and the third quarter of 2025 (at right). Caterpillar management utilizes these charts internally to visually communicate with the company's board of directors and employees.

Total sales and revenues for the third quarter of 2025 were $17.638 billion, an increase of $1.532 billion, or 10%, compared with $16.106 billion in the third quarter of 2024. The increase was primarily due to higher sales volume of $1.554 billion. The increase in sales volume was mainly driven by higher sales of equipment to end users.

Sales were higher across the three primary segments.

Consolidated Operating Profit

Consolidated Operating Profit Comparison
Third Quarter 2025 vs. Third Quarter 2024  

To access this chart, go to https://investors.caterpillar.com/financials/quarterly-results/default.aspx for the downloadable version of Caterpillar third-quarter 2025 earnings.

The chart above graphically illustrates reasons for the change in consolidated operating profit between the third quarter of 2024 (at left) and the third quarter of 2025 (at right). Caterpillar management utilizes these charts internally to visually communicate with the company's board of directors and employees. The bar titled Other includes consolidating adjustments and Machinery, Energy & Transportation's other operating (income) expenses.

Operating profit for the third quarter of 2025 was $3.052 billion, a decrease of $95 million, or 3%, compared with $3.147 billion in the third quarter of 2024. The decrease was mainly due to unfavorable manufacturing costs of $686 million, unfavorable price realization of $191 million and higher selling, general and administrative (SG&A) and research and development (R&D) expenses of $129 million. This was partially offset by the profit impact of higher sales volume of $700 million, favorable other operating income/expense of $180 million and lower restructuring costs of $33 million. Unfavorable manufacturing costs largely reflected the impact of higher tariffs. The increase in SG&A/R&D expenses was primarily driven by higher compensation expenses, including higher short-term incentive compensation expense. Favorable other operating income/expense included proceeds from an insurance claim.

Other Profit/Loss and Tax Items

• Other income (expense) in the third quarter of 2025 was income of $208 million, compared with income of $76 million in the third quarter of 2024. The change was primarily driven by favorable foreign currency impacts.
  
  
• The effective tax rate for the third quarter of 2025 was 26.7% compared to 20.7% for the third quarter of 2024. Excluding the discrete items discussed below, the third-quarter 2025 estimated global annual effective tax rate was 24.0% compared with 22.5% for the third quarter of 2024.
  
  The company recorded a $54 million charge in the third quarter of 2025 for an increase in the estimated global annual effective tax rate through the first six months, primarily due to a change in tax incentives driven by U.S. tax legislation enacted on July 4, 2025, which reinstated 100 percent bonus depreciation and full expensing of U.S. research and development expenditures. The company also recorded a discrete tax charge of $41 million in the third quarter of 2025, compared to discrete tax benefits of $47 million in the third quarter of 2024, to reflect changes in estimates related to prior years. In addition, a discrete tax benefit of $10 million was recorded in the third quarter of 2025, compared with a $7 million benefit in the third quarter of 2024, for the settlement of stock-based compensation awards with associated tax deductions in excess of cumulative U.S. GAAP compensation expense.
  
  Please see a reconciliation of GAAP to non-GAAP financial measures in the appendix on pages 12 and 13.

Construction Industries' total sales were $6.760 billion in the third quarter of 2025, an increase of $415 million, or 7%, compared with $6.345 billion in the third quarter of 2024. The increase in sales was mainly due to higher sales volume of $568 million and favorable currency impacts of $69 million, primarily related to the euro, partially offset by unfavorable price realization of $262 million. Higher sales volume was primarily driven by higher sales of equipment to end users.

• In North America, sales increased due to higher sales volume, partially offset by unfavorable price realization. Higher sales volume was mainly driven by higher sales of equipment to end users.
• Sales decreased in Latin America due to unfavorable price realization, partially offset by higher sales volume and favorable currency impacts primarily related to the Brazilian real. Higher sales volume was mainly driven by higher sales of equipment to end users.
• In EAME, sales increased mainly due to higher sales volume and favorable currency impacts primarily related to the euro, partially offset by unfavorable price realization. Higher sales volume was primarily driven by higher sales of equipment to end users.
• Sales increased in Asia/Pacific mainly due to higher sales volume and favorable currency impacts primarily related to the Japanese yen. Higher sales volume was mainly driven by the impact from changes in dealer inventories. Dealer inventory increased during the third quarter of 2025, compared with a decrease during the third quarter of 2024.

Construction Industries' segment profit was $1.377 billion in the third quarter of 2025, a decrease of $109 million, or 7%, compared with $1.486 billion in the third quarter of 2024. The decrease was primarily due to unfavorable price realization of $262 million and unfavorable manufacturing costs of $174 million, partially offset by the profit impact of higher sales volume of $313 million. Unfavorable manufacturing costs largely reflected the impact of higher tariffs.

Resource Industries' total sales were $3.110 billion in the third quarter of 2025, an increase of $62 million, or 2%, compared with $3.048 billion in the third quarter of 2024. The increase was primarily due to higher sales volume of $138 million, partially offset by unfavorable price realization of $61 million. The increase in sales volume was mainly driven by higher sales of equipment to end users.

Resource Industries' segment profit was $499 million in the third quarter of 2025, a decrease of $120 million, or 19%, compared with $619 million in the third quarter of 2024. The decrease was mainly due to unfavorable manufacturing costs of $92 million and unfavorable price realization of $61 million, partially offset by the profit impact of higher sales volume of $49 million. Unfavorable manufacturing costs largely reflected the impact of higher tariffs.

Energy & Transportation's total sales were $8.397 billion in the third quarter of 2025, an increase of $1.210 billion, or 17%, compared with $7.187 billion in the third quarter of 2024. The increase was primarily due to higher sales volume of $870 million and higher inter-segment sales of $156 million.

• Oil and Gas – Sales increased for turbines and turbine-related services. Sales also increased in reciprocating engines used in gas compression applications.
• Power Generation – Sales increased in large reciprocating engines, primarily data center applications.
• Industrial – Sales increased in EAME, partially offset by decreased sales in Asia/Pacific.
• Transportation – Sales increased in rail services.

Energy & Transportation's segment profit was $1.678 billion in the third quarter of 2025, an increase of $245 million, or 17%, compared with $1.433 billion in the third quarter of 2024. The increase was primarily due to the profit impact of higher sales volume of $357 million and favorable price realization of $132 million, partially offset by unfavorable manufacturing costs of $287 million. Unfavorable manufacturing costs primarily reflected the impact of higher tariffs.

Financial Products' segment revenues were $1.076 billion in the third quarter of 2025, an increase of $42 million, or 4%, compared with $1.034 billion in the third quarter of 2024. The increase was primarily due to a favorable impact from higher average earning assets of $56 million driven by North America, partially offset by an unfavorable impact from lower average financing rates of $15 million across all regions except Latin America.

Financial Products' segment profit was $241 million in the third quarter of 2025, a decrease of $5 million, or 2%, compared with $246 million in the third quarter of 2024. The decrease was mainly due to a higher provision for credit losses at Cat Financial of $15 million, higher SG&A expenses of $7 million and an unfavorable impact from equity securities at Insurance Services of $6 million, partially offset by a favorable impact from higher average earning assets of $23 million.

At the end of the third quarter of 2025, past dues at Cat Financial were 1.47%, compared with 1.74% at the end of the third quarter of 2024. Write-offs, net of recoveries, were $40 million for the third quarter of 2025, compared with $27 million for the third quarter of 2024. As of September 30, 2025, Cat Financial's allowance for credit losses totaled $283 million, or 0.89% of finance receivables, compared with $290 million, or 0.94% of finance receivables at June 30, 2025. The allowance for credit losses at year-end 2024 was $267 million, or 0.91% of finance receivables.

Corporate Items and Eliminations

Expense for corporate items and eliminations was $584 million in the third quarter of 2025, an increase of $127 million from the third quarter of 2024, primarily driven by higher corporate costs, including higher short-term incentive compensation expense, and increased expenses due to timing differences, partially offset by proceeds from an insurance claim and favorable impacts of segment reporting methodology differences.

Notes

i.  Glossary of terms is included on the Caterpillar website at https://investors.caterpillar.com/overview/default.aspx.
ii.  Sales of equipment to end users is demonstrated by the company's Rolling 3 Month Retail Sales Statistics filed in a Form 8-K on Wednesday, Oct. 29, 2025.
iii.  Information on non-GAAP financial measures is included in the appendix on pages 12 and 13.
iv.  Some amounts within this report are rounded to the millions or billions and may not add.
v.  Caterpillar will conduct a teleconference and live webcast, with a slide presentation, beginning at 7:30 a.m. Central Time on Wednesday, Oct. 29, 2025, to discuss its 2025 third-quarter results. The accompanying slides will be available before the webcast on the Caterpillar website at https://investors.caterpillar.com/events-presentations/default.aspx.

About Caterpillar

With 2024 sales and revenues of $64.8 billion, Caterpillar Inc. is the world's leading manufacturer of construction and mining equipment, off-highway diesel and natural gas engines, industrial gas turbines and diesel-electric locomotives. For 100 years, we've been helping customers build a better, more sustainable world and are committed and contributing to a reduced-carbon future. Our innovative products and services, backed by our global dealer network, provide exceptional value that helps customers succeed. Caterpillar does business on every continent, principally operating through three primary segments – Construction Industries, Resource Industries and Energy & Transportation – and providing financing and related services through our Financial Products segment. Visit us at caterpillar.com or join the conversation on our social media channels at caterpillar.com/en/news/social-media.html.

Caterpillar's latest financial results are also available online:

https://investors.caterpillar.com/overview/default.aspx

https://investors.caterpillar.com/financials/quarterly-results/default.aspx  (live broadcast/replays of quarterly conference call)

Forward-Looking Statements

Certain statements in this press release relate to future events and expectations and are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "believe," "estimate," "will be," "will," "would," "expect," "anticipate," "plan," "forecast," "target," "guide," "project," "intend," "could," "should" or other similar words or expressions often identify forward-looking statements. All statements other than statements of historical fact are forward-looking statements, including, without limitation, statements regarding our outlook, projections, forecasts or trend descriptions. These statements do not guarantee future performance and speak only as of the date they are made, and we do not undertake to update our forward-looking statements.

Caterpillar's actual results may differ materially from those described or implied in our forward-looking statements based on a number of factors, including, but not limited to: (i) global and regional economic conditions and economic conditions in the industries we serve; (ii) commodity price changes, material price increases, fluctuations in demand for our products or significant shortages of material; (iii) government monetary or fiscal policies; (iv) political and economic risks, commercial instability and events beyond our control in the countries in which we operate; (v) international trade policies and their impact on demand for our products and our competitive position, including the imposition of new tariffs or changes in existing tariff rates; (vi) our ability to develop, produce and market quality products that meet our customers' needs; (vii) the impact of the highly competitive environment in which we operate on our sales and pricing; (viii) information technology security threats and computer crime; (ix) inventory management decisions and sourcing practices of our dealers and our OEM customers; (x) a failure to realize, or a delay in realizing, all of the anticipated benefits of our acquisitions, joint ventures or divestitures; (xi) union disputes or other employee relations issues; (xii) adverse effects of unexpected events; (xiii) disruptions or volatility in global financial markets limiting our sources of liquidity or the liquidity of our customers, dealers and suppliers; (xiv) failure to maintain our credit ratings and potential resulting increases to our cost of borrowing and adverse effects on our cost of funds, liquidity, competitive position and access to capital markets; (xv) our Financial Products segment's risks associated with the financial services industry; (xvi) changes in interest rates or market liquidity conditions; (xvii) an increase in delinquencies, repossessions or net losses of Cat Financial's customers; (xviii) currency fluctuations; (xix) our or Cat Financial's compliance with financial and other restrictive covenants in debt agreements; (xx) increased pension plan funding obligations; (xxi) alleged or actual violations of trade or anti-corruption laws and regulations; (xxii) additional tax expense or exposure, including the impact of U.S. tax reform; (xxiii) significant legal proceedings, claims, lawsuits or government investigations; (xxiv) new regulations or changes in financial services regulations; (xxv) compliance with environmental laws and regulations; (xxvi) catastrophic events, including global pandemics such as the COVID-19 pandemic; and (xxvii) other factors described in more detail in Caterpillar's Forms 10-Q, 10-K and other filings with the Securities and Exchange Commission.

APPENDIX

NON-GAAP FINANCIAL MEASURES

The following definitions are provided for the non-GAAP financial measures. These non-GAAP financial measures have no standardized meaning prescribed by U.S. GAAP and therefore are unlikely to be comparable to the calculation of similar measures for other companies. Management does not intend these items to be considered in isolation or as a substitute for the related GAAP measures.

The company believes it is important to separately quantify the profit impact of one significant item in order for the company's results to be meaningful to readers. This item consists of (i) restructuring income/costs. The company does not consider this item indicative of earnings from ongoing business activities and believes the non-GAAP measure provides investors with useful perspective on underlying business results and trends and aids with assessing the company's period-over-period results. The company intends to discuss adjusted profit per share for the fourth quarter and full-year 2025, excluding mark-to-market gains or losses for remeasurement of pension and other postemployment benefit plans.

Reconciliations of adjusted results to the most directly comparable GAAP measure are as follows:

The company believes it is important to separately disclose the annual effective tax rate, excluding discrete items for the results to be meaningful to readers. The annual effective tax rate is discussed using non-GAAP financial measures that exclude the effects of amounts associated with discrete items recorded fully in the quarter they occur. For the three months ended September 30, 2025 and 2024, these items consist of (i) the increase in the annual effective tax rate in 2025, (ii) the impact of changes in estimates related to prior years and (iii) the settlement of stock-based compensation awards with associated tax deductions in excess of cumulative U.S. GAAP compensation expense. The company believes the non-GAAP measures will provide investors with useful perspective on underlying business results and trends and aids with assessing the company's period-over-period results.

A reconciliation of the effective tax rate to annual effective tax rate, excluding discrete items is below: