CATERPILLAR INC
For the period ended Sep 30, 2026. Filed Nov 4, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2026 · Filed Nov 4, 2026
CAT$558.63+0.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-06-30; filed 2026-08-05.
0000018230-26-000046
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-09-30; filed 2026-11-04.
0000018230-26-000057
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 274 previous paragraphs and 274 current paragraphs.
135 unchanged; 100 reworded; 34 added; 35 removed; 4 previous and 5 current paragraphs rearranged.
Tables are not compared: 23 previous and 23 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (34)
Current report
•Total sales and revenues were $58.640 billion for the nine months ended September 30, 2026, an increase of $10.184 billion, or 21 percent, compared with $48.456 billion for the nine months ended September 30, 2025.
Current report
Total sales and revenues for the third quarter of 2026 were $20.682 billion, an increase of $3.044 billion, or 17 percent, compared with $17.638 billion in the third quarter of 2025. The increase was primarily due to higher sales volume of $2.2 billion and favorable price realization of $663 million.
Current report
Our strong execution through the first nine months of 2026 positions us well to meet our full-year outlook. We continue to expect sales and revenues growth in the mid-to-high teens for 2026 as compared to 2025. We expect strong growth in sales of equipment to end users across our three primary segments, driven by healthy end markets; strong order rates across our three primary segments, driving backlog growth; increased output from our capacity expansion plans, which remain on schedule; and strong services revenues growth.
Current report
Total sales and revenues for the third quarter of 2026 were $20.682 billion, an increase of $3.044 billion, or 17 percent, compared with $17.638 billion in the third quarter of 2025. The increase was primarily due to higher sales volume of $2.2 billion and favorable price realization of $663 million. Higher sales volume was mainly driven by higher sales of equipment to end users.
Current report
EAME sales increased 16 percent mainly due to higher sales volume and favorable price realization. Higher sales volume was primarily driven by higher sales of equipment to end users.
Current report
Sales decreased 3 percent in Asia/Pacific due to lower sales volume and unfavorable price realization, partially offset by favorable currency impacts mainly related to the Japanese yen. Lower sales volume was mainly driven by the impact from changes in dealer inventories.
Current report
Operating profit for the third quarter of 2026 was $4.214 billion, an increase of $1.162 billion, or 38 percent, compared with $3.052 billion in the third quarter of 2025. The increase was primarily due to the profit impact of higher sales volume.
Current report
In the third quarter of 2025, the company also recorded a $54 million charge for an increase in the estimated annual effective tax rate through the first six months and a discrete tax charge of $41 million to reflect changes in estimates related to prior years.
Current report
Power & Energy’s total sales were $8.784 billion in the third quarter of 2026, an increase of $1.321 billion, or 18 percent, compared with $7.463 billion in the third quarter of 2025. The increase was primarily due to higher sales volume of $879 million and favorable price realization of $216 million.
Current report
•Industrial – Sales increased mainly in North America.
Current report
Construction Industries’ total sales were $7.983 billion in the third quarter of 2026, an increase of $1.223 billion, or 18 percent, compared with $6.760 billion in the third quarter of 2025. The increase in sales was mainly due to higher sales volume of $874 million and favorable price realization of $349 million. Higher sales volume was primarily driven by higher sales of equipment to end users.
Current report
•In EAME, sales increased primarily due to favorable price realization and higher sales volume. Higher sales volume was mainly driven by higher sales of equipment to end users.
Current report
•Sales increased in Asia/Pacific due to higher sales volume, partially offset by unfavorable price realization and unfavorable currency impacts primarily related to the Japanese yen. Higher sales volume was mainly driven by the impact from changes in dealer inventories.
Current report
Construction Industries’ segment profit was $1.831 billion in the third quarter of 2026, an increase of $454 million, or 33 percent, compared with $1.377 billion in the third quarter of 2025. The increase was primarily due to the profit impact of higher sales volume of $356 million and favorable price realization of $349 million, partially offset by unfavorable manufacturing costs of $252 million. Unfavorable manufacturing costs included the impact of higher freight.
Current report
Construction Industries’ segment profit as a percent of total sales was 22.9 percent in the third quarter of 2026, compared with 20.4 percent in the third quarter of 2025.
Current report
Resource Industries’ total sales were $4.615 billion in the third quarter of 2026, an increase of $616 million, or 15 percent, compared with $3.999 billion in the third quarter of 2025. The increase was primarily due to higher sales volume of $478 million and favorable price realization of $96 million.
Current report
Resource Industries’ segment profit was $622 million in the third quarter of 2026, an increase of $78 million, or 14 percent, compared with $544 million in the third quarter of 2025. The increase was mainly due to the profit impact of higher sales volume of $181 million and favorable price realization of $96 million, partially offset by unfavorable manufacturing costs of $208 million. Unfavorable manufacturing costs primarily reflected higher material costs, including tariffs.
Current report
Resource Industries’ segment profit as a percent of total sales was 13.5 percent in the third quarter of 2026, compared with 13.6 percent in the third quarter of 2025.
Current report
NINE MONTHS ENDED SEPTEMBER 30, 2026 COMPARED WITH NINE MONTHS ENDED SEPTEMBER 30, 2025
Current report
Total sales and revenues were $58.640 billion for the nine months ended September 30, 2026, an increase of $10.184 billion, or 21 percent, compared with $48.456 billion for the nine months ended September 30, 2025. The increase was primarily due to higher sales volume of $7.6 billion and favorable price realization of $1.7 billion. The increase in sales volume was mainly driven by higher sales of equipment to end users.
Current report
North America sales increased 32 percent primarily due to higher sales volume. The increase in sales volume was mainly driven by higher sales of equipment to end users.
Current report
Operating profit for the nine months ended September 30, 2026, was $11.594 billion, an increase of $3.103 billion, or 37 percent, compared with $8.491 billion for the nine months ended September 30, 2025. The increase was primarily due to the profit impact of higher sales volume.
Current report
Operating profit for the nine months ended September 30, 2026 included $520 million of IEEPA tariff recoveries.
Current report
Operating profit margin was 19.8 percent for the nine months ended September 30, 2026, compared with 17.5 percent for the nine months ended September 30, 2025.
Current report
The company also recorded a discrete tax charge of $41 million in the nine months ended September 30, 2025, to reflect changes in estimates related to prior years.
Current report
Construction Industries’ total sales were $23.490 billion for the nine months ended September 30, 2026, an increase of $5.356 billion, or 30 percent, compared with $18.134 billion for the nine months ended September 30, 2025. The increase was primarily due to higher sales volume of $4.1 billion and favorable price realization of $1.0 billion. Higher sales volume was mainly driven by higher sales of equipment to end users.
Current report
Resource Industries’ total sales were $13.060 billion for the nine months ended September 30, 2026, an increase of $1.514 billion, or 13 percent, compared with $11.546 billion for the nine months ended September 30, 2025. The increase was primarily due to higher sales volume.
Current report
On October 31, 2026, Caterpillar completed its previously announced acquisition of 100 percent of the equity in Fabick. The preliminary purchase price, which remains subject to working capital and other adjustments to be finalized post-acquisition, includes $1.24 billion cash paid at closing with a remaining estimated $165 million to be paid in cash after the expiration of certain holdback periods. For more information see Note 23 - "Subsequent event" of Part I, Item 1 "Financial Statements."
Current report
Retirement Benefits
Current report
We recognize mark-to-market gains and losses immediately through earnings upon the remeasurement of our pension and OPEB plans. Mark-to-market gains and losses represent the effects of actual results differing from our assumptions and the effects of changing assumptions. We will record the annual mark-to-market adjustment as of the measurement date, December 31, 2026. It is difficult to predict the December 31, 2026 adjustment amount, as it will be dependent primarily on changes in discount rates during 2026, and actual returns on plan assets differing from our expected returns for 2026.
Current report
For the Nine Months Ended September 30, 2026
Current report
For the Nine Months Ended September 30, 2025
Current report
For the Nine Months Ended September 30, 2026
Current report
For the Nine Months Ended September 30, 2025
Removed paragraphs (35)
Previous report
•Total sales and revenues were $37.958 billion for the six months ended June 30, 2026, an increase of $7.140 billion, or 23 percent, compared with $30.818 billion for the six months ended June 30, 2025.
Previous report
Total sales and revenues for the second quarter of 2026 were $20.543 billion, an increase of $3.974 billion, or 24 percent, compared with $16.569 billion in the second quarter of 2025. The increase was primarily due to higher sales volumeof $3.1 billion and favorable price realization of $595 million.
Previous report
We continue to see strong momentum in our end markets despite ongoing uncertainty due to geopolitical events. We are also progressing on our capacity expansion plans, and we expect to increase our throughput in the second half of 2026.
Previous report
In the third quarter of 2026 as compared to the third quarter of 2025, we anticipate strong sales and revenues growth, primarily driven by higher sales volume and favorable price realization in each of our three primary segments. We expect higher sales volume to be mainly driven by higher sales of equipment to end users across all three primary segments in the third quarter of 2026 as compared to the third quarter of 2025.
Previous report
Total sales and revenues for the second quarter of 2026 were $20.543 billion, an increase of $3.974 billion, or 24 percent, compared with $16.569 billion in the second quarter of 2025. The increase was primarily due to higher sales volume of $3.1 billion and favorable price realization of $595 million. Higher sales volume was mainly driven by higher sales of equipment to end users.
Previous report
EAME sales increased 15 percent mainly due to higher sales volume and favorable currency impacts primarily related to the euro. Higher sales volume was mainly driven by higher sales of equipment to end users.
Previous report
Operating profit for the second quarter of 2026 was $4.295 billion, an increase of $1.435 billion, or 50 percent, compared with $2.860 billion in the second quarter of 2025. The increase was primarily due to the profit impact of higher sales volume.
Previous report
Power & Energy’s total sales were $8.238 billion in the second quarter of 2026, an increase of $1.201 billion, or 17 percent, compared with $7.037 billion in the second quarter of 2025. The increase was primarily due to higher sales volume of $736 million, favorable price realization of $212 million and higher inter-segment sales of $200 million.
Previous report
Construction Industries’ total sales were $8.346 billion in the second quarter of 2026, an increase of $2.156 billion, or 35 percent, compared with $6.190 billion in the second quarter of 2025. The increase in sales was mainly due to higher sales volume of $1.8 billion and favorable price realization of $309 million. Higher sales volume was primarily driven by higher sales of equipment to end users.
Previous report
•In North America, sales increased primarily due to higher sales volume and favorable price realization. Higher sales volume was mainly driven by higher sales of equipment to end users and by the impact from changes in dealer inventories.
Previous report
Construction Industries’ segment profit was $1.947 billion in the second quarter of 2026, an increase of $703 million, or 57 percent, compared with $1.244 billion in the second quarter of 2025. The increase was primarily due to the profit impact of higher sales volume.
Previous report
Construction Industries’ segment profit as a percent of total sales was 23.3 percent in the second quarter of 2026, compared with 20.1 percent in the second quarter of 2025.
Previous report
Resource Industries’ total sales were $4.648 billion in the second quarter of 2026, an increase of $762 million, or 20 percent, compared with $3.886 billion in the second quarter of 2025. The increase was primarily due to higher sales volume. Higher sales volume was primarily driven by higher sales of equipment to end users.
Previous report
Resource Industries’ segment profit was $693 million in the second quarter of 2026, an increase of $130 million, or 23 percent, compared with $563 million in the second quarter of 2025. The increase was mainly due to the profit impact of higher sales volume of $269 million, partially offset by unfavorable manufacturing costs of $158 million. Unfavorable manufacturing costs primarily reflected increased period manufacturing costs.
Previous report
Resource Industries’ segment profit as a percent of total sales was 14.9 percent in the second quarter of 2026, compared with 14.5 percent in the second quarter of 2025.
Previous report
In the second quarter of 2026, restructuring costs increased primarily due to the divestiture of certain non-U.S. entities.
Previous report
SIX MONTHS ENDED JUNE 30, 2026 COMPARED WITH SIX MONTHS ENDED JUNE 30, 2025
Previous report
Total sales and revenues were $37.958 billion for the six months ended June 30, 2026, an increase of $7.140 billion, or 23 percent, compared with $30.818 billion for the six months ended June 30, 2025. The increase was primarily due to higher sales volume of $5.4 billion and favorable price realization of $1.0 billion. The increase in sales volume was mainly driven by higher sales of equipment to end users and the impact from changes in dealer inventories. Dealer inventory increased more during the six months ended June 30, 2026 than during the six months ended June 30, 2025.
Previous report
Sales increased 7 percent in Latin America mainly due to higher sales volume. The increase in sales volume was primarily driven by higher sales of equipment to end users.
Previous report
EAME sales increased 17 percent primarily due to higher sales volume and favorable currency impacts mainly related to the euro. The increase in sales volume was primarily driven by the impact from changes in dealer inventories. Dealer inventory increased more during the six months ended June 30, 2026, than during the six months ended June 30, 2025.
Previous report
Sales increased 4 percent in Asia/Pacific mainly due favorable currency impacts primarily related to the Australian dollar.
Previous report
Operating profit for the six months ended June 30, 2026, was $7.380 billion, an increase of $1.941 billion, or 36 percent, compared with $5.439 billion for the six months ended June 30, 2025. The increase was primarily due to the profit impact of higher sales volume.
Previous report
Operating profit for the six months ended June 30, 2026 included $392 million of expected IEEPA tariff recoveries.
Previous report
Operating profit margin was 19.4 percent for the six months ended June 30, 2026, compared with 17.6 percent for the six months ended June 30, 2025.
Previous report
Construction Industries’ total sales were $15.507 billion for the six months ended June 30, 2026, an increase of $4.133 billion, or 36 percent, compared with $11.374 billion for the six months ended June 30, 2025. The increase was primarily due to higher sales volume of $3.2 billion and favorable price realization of $665 million. Higher sales volume was mainly driven by the impact from changes in dealer inventories and higher sales of equipment to end users. Dealer inventory increased during the six months ended June 30, 2026, compared with a decrease during the six months ended June 30, 2025.
Previous report
•In North America, sales increased due to higher sales volume and favorable price realization. Higher sales volume was mainly driven by the impact from changes in dealer inventories and higher sales of equipment to end users.
Previous report
•Sales increased in Latin America mainly due to higher sales volume and favorable currency impacts primary related to the Brazilian real. Higher sales volume was mainly driven by higher sales of equipment to end users.
Previous report
•In EAME, sales increased primarily due to higher sales volume and favorable currency impacts mainly related to the euro. Higher sales volume was primarily driven by the impact from changes in dealer inventories.
Previous report
Resource Industries’ total sales were $8.445 billion for the six months ended June 30, 2026, an increase of $898 million, or 12 percent, compared with $7.547 billion for the six months ended June 30, 2025. The increase was primarily due to higher sales volume. The increase in sales volume was mainly due to higher sales of equipment to end users.
Previous report
•Rail – Sales increased due to higher international locomotive deliveries. Sales also increased in rail services.
Previous report
For the six months ended June 30, 2026, restructuring costs increased primarily due to the divestiture of certain non-U.S. entities.
Previous report
For the Six Months Ended June 30, 2026
Previous report
For the Six Months Ended June 30, 2025
Previous report
For the Six Months Ended June 30, 2026
Previous report
For the Six Months Ended June 30, 2025
Reworded paragraphs (100)
Previous wording
Highlights for the second quarter of 2026 include:
Current wording
Highlights for the third quarter of 2026 include:
Previous wording
•Total sales and revenues for the second quarter of 2026 were $20.543 billion, an increase of $3.974 billion, or 24 percent, compared with $16.569 billion in the second quarter of 2025. Sales were higher across the three primary segments.
Current wording
•Total sales and revenues for the third quarter of 2026 were $20.682 billion, an increase of $3.044 billion, or 17 percent, compared with $17.638 billion in the third quarter of 2025. Sales were higher across the three primary segments.
Previous wording
•Operating profit margin was 20.9 percent for the second quarter of 2026, compared with 17.3 percent for the second quarter of 2025. Adjusted operating profit margin was 21.9 percent for the second quarter of 2026, compared with 17.6 percent for the second quarter of 2025.
Current wording
•Operating profit margin was 20.4 percent for the third quarter of 2026, compared with 17.3 percent for the third quarter of 2025. Adjusted operating profit margin was 20.6 percent for the third quarter of 2026, compared with 17.5 percent for the third quarter of 2025.
Previous wording
•Second-quarter 2026 profit per share was $7.77, and excluding the items in the table below, adjusted profit per share was $8.17. Second-quarter 2025 profit per share was $4.62, and excluding the item in the table below, adjusted profit per share was $4.72.
Current wording
•Third-quarter 2026 profit per share was $7.13, and excluding the item in the table below, adjusted profit per share was $7.20. Third-quarter 2025 profit per share was $4.88, and excluding the item in the table below, adjusted profit per share was $4.95.
Previous wording
•Caterpillar ended the second quarter of 2026 with $6.7 billion of enterprise cash.
Current wording
•Caterpillar ended the third quarter of 2026 with $7.9 billion of enterprise cash.
Previous wording
Highlights for the six months ended June 30, 2026 include:
Current wording
Highlights for the nine months ended September 30, 2026 include:
Previous wording
•Operating profit margin was 19.4 percent for the six months ended June 30, 2026, compared with 17.6 percent for the six months ended June 30, 2025. Adjusted operating profit margin was 20.1 percent for the six months ended June 30, 2026, compared with 17.9 percent for the six months ended June 30, 2025.
Current wording
•Operating profit margin was 19.8 percent for the nine months ended September 30, 2026, compared with 17.5 percent for the nine months ended September 30, 2025. Adjusted operating profit margin was 20.3 percent for the nine months ended September 30, 2026, compared with 17.8 percent for the nine months ended September 30, 2025.
Previous wording
•Profit per share for the six months ended June 30, 2026, was $13.23, and excluding the items in the table below, adjusted profit per share was $13.70. Profit per share for the six months ended June 30, 2025, was $8.82, and excluding the item in the table below, adjusted profit per share was $8.97.
Current wording
•Profit per share for the nine months ended September 30, 2026, was $20.36, and excluding the items in the table below, adjusted profit per share was $20.90. Profit per share for the nine months ended September 30, 2025, was $13.69, and excluding the item in the table below, adjusted profit per share was $13.91.
Previous wording
•Enterprise operating cash flow was $6.2 billion for the six months ended June 30, 2026.
Current wording
•Enterprise operating cash flow was $10.6 billion for the nine months ended September 30, 2026.
Previous wording
A detailed reconciliation of GAAP to non-GAAP financial measures is included on pages 71-73.
Current wording
A detailed reconciliation of GAAP to non-GAAP financial measures is included on pages 72-75.
Previous wording
Second-quarter 2026 profit per share was $7.77, compared with $4.62 profit per share in the second quarter of 2025. In the second quarter of 2026 and 2025, profit per share included restructuring costs. Profit for the second quarter of 2026 was $3.593 billion, an increase of $1.414 billion, or 65 percent, compared with $2.179 billion for the second quarter of 2025. The increase was mainly due to the profit impact of higher sales volume.
Current wording
Third-quarter 2026 profit per share was $7.13, compared with third-quarter 2025 profit per share of $4.88. In the third quarter of 2026 and 2025, profit per share included restructuring costs. Profit for the third quarter of 2026 was $3.287 billion, an increase of $987 million, or 43 percent, compared with $2.300 billion for the third quarter of 2025. The increase was mainly due to the profit impact of higher sales volume.
Previous wording
In Power & Energy, our positive outlook for 2026 continues to reflect strong demand in both Power Generation and Oil & Gas. We continue to anticipate growth in Power Generation for both reciprocating engines and turbines and turbine-related services, driven by increasing energy demand to support data center build-out related to cloud computing and generative Artificial Intelligence (AI). Additionally, prime power demand continues to trend higher for turbines and turbine-related services and for reciprocating engine products and services to support their need for power solutions. Oil & Gas is expected to grow moderately in 2026 as compared to 2025. Reciprocating engine sales are anticipated to increase, driven by strong demand in gas compression applications. We expect continued momentum in demand for reciprocating engine aftermarket parts. For turbines and turbine-related services used in Oil & Gas applications, sales are expected to grow while the backlog remains healthy, with continued solid order and inquiry activity. Demand for products in Industrial applications is expected to grow moderately in 2026 as compared to 2025.
Current wording
In Power & Energy, demand for both Oil & Gas and Power Generation remains strong in 2026 as compared to 2025. Backlog continues to grow due to strong order rates. We continue to anticipate growth in Power Generation for both reciprocating engines and turbines and turbine-related services, driven by increasing energy demand to support the data center build-out related to cloud computing and generative Artificial Intelligence (AI). Additionally, prime power demand continues to trend higher for turbines and turbine-related services and for reciprocating engine products to support customers’ need for power solutions. Oil & Gas is expected to grow moderately in 2026 as compared to 2025. Reciprocating engine sales are anticipated to increase, driven by strong demand in gas compression applications. We expect continued momentum in demand for reciprocating engine aftermarket parts. For turbines and turbine-related services used in Oil & Gas applications, sales are expected to grow while the backlog remains healthy, with solid order and inquiry activity. Demand for products in Industrial applications is expected to grow moderately in 2026 as compared to 2025.
Previous wording
In Construction Industries, in 2026 as compared to 2025, we continue to expect growth in sales of equipment to end users supported by strong order rates. The outlook for North America remains positive, as sales of equipment to end users are anticipated to grow in 2026 as compared to 2025. Construction spending remains at healthy levels supported by the Infrastructure Investment and Jobs Act (IIJA), with the remaining funds to be spent over the next few years. Non-residential investment in critical infrastructure programs, heavy construction and data centers is contributing to overall construction spending levels. We expect dealer rental fleet loading will continue to grow in 2026 compared to 2025, including additional fleet loading for Major Projects in the third quarter of 2026. In EAME, Europe is expected to remain stable in 2026 as compared to 2025, supported by non-residential construction, and construction activity in Africa is projected to remain strong. While the Middle East continues to be challenged, we currently anticipate only a limited impact on sales of equipment to end users in EAME. In Asia Pacific, outside of China, softer economic conditions are expected in 2026. In China, we anticipate moderate conditions, with growth in the above 10-ton excavator industry in 2026, off of low levels of activity. Growth in Latin America is expected to continue.
Current wording
In Construction Industries, in 2026 as compared to 2025, we expect strong fourth-quarter and full-year growth in sales of equipment to end users, supported by healthy end markets. The outlook for North America remains positive, with construction spending at healthy levels. Non-residential construction investment continues to be supported by the Infrastructure Investment and Jobs Act (IIJA), critical infrastructure programs and data centers. We expect dealer rental fleet loading to remain strong; however, it will contribute less to growth in sales of equipment to end users in Construction Industries in the fourth quarter of 2026 than in the third quarter of 2026 due to strong rental fleet loading in the fourth quarter of 2025. In EAME, Europe is expected to remain stable in 2026 as compared to 2025, supported by non-residential construction, while construction activity in Africa is projected to remain strong. The Middle East continues to face challenges, but we currently anticipate only a limited impact on sales of equipment to end users in EAME. In Asia/Pacific, outside of China, stable economic conditions are expected in 2026. In China, we anticipate moderate conditions, with growth in the above 10-ton excavator industry in 2026, off low levels of activity. Growth in Latin America is expected to continue.
Previous wording
In Resource Industries, we are seeing continued positive momentum with robust order rates and strong backlog growth. Sales of equipment to end users are expected to increase in 2026 as compared to 2025, primarily driven by rising demand for copper and gold, and positive dynamics in Heavy Construction and Quarry and Aggregates. In Mining, most key commodities remain above investment thresholds, customer product utilization is high, and the age of the fleet remains elevated. While some commodity prices have increased recently, customers remain focused on the long-term. We now expect rebuild activity in 2026 to increase moderately as compared to 2025. Rail services and locomotive deliveries are both anticipated to grow in 2026 as compared to 2025.
Current wording
In Resource Industries, we are seeing continued positive momentum with robust order rates driving strong backlog growth. Customer product utilization is high, and the age of the fleet remains elevated. Most key commodities remain above investment thresholds, and customers are focused on the long term. We expect strong growth in sales of equipment to end users in 2026 as compared to 2025, primarily driven by rising demand for copper and gold, increasing activity in the Canadian oil sands and positive dynamics in Heavy Construction and Quarry and Aggregates. We expect strong growth in sales of equipment to end users in the fourth quarter of 2026 as compared to the fourth quarter of 2025, including a favorable impact from the timing of commissioning. We continue to expect rebuild activity in 2026 to increase moderately as compared to 2025. Rail services are anticipated to grow in 2026 as compared to 2025. We now expect locomotive deliveries to be slightly lower in 2026 as compared to 2025 due to the timing of deliveries.
Previous wording
Third-Quarter 2026 Company Trends and Expectations
Current wording
Fourth-Quarter 2026 Company Trends and Expectations
Previous wording
We now anticipate sales and revenues growth in the mid-to-high teens for 2026 as compared to 2025. We expect strong sales growth across each of our primary segments, mainly driven by higher sales volume and favorable price realization. Services revenues are also expected to grow in 2026 as compared to 2025. We expect higher sales and revenues in the second half of 2026 as compared to the first half of 2025 following the typical seasonable trend. We expect a more typical decrease in Construction Industries’ dealer inventory of over $1.0 billion in the fourth quarter of 2026. We also expect Construction Industries’ dealer inventory will be higher at year-end 2026 as compared to year-end 2025. As a result, we expect an unfavorable impact from changes in dealer inventories for Construction Industries’ sales volume in the second half of 2026 as compared to the second half of 2025.
Current wording
We anticipate moderate sales and revenues growth in the fourth quarter of 2026 as compared to the fourth quarter of 2025.
Previous wording
In the third quarter of 2026 as compared to the third quarter of 2025, we anticipate strong sales growth in Power & Energy, driven by continued strength in Power Generation and in Oil & Gas, and modest growth in Industrial applications as it continues to recover. We expect favorable price realization in Power & Energy. In Construction Industries, we expect strong sales growth primarily due to higher sales volume and favorable price realization. We expect higher sales volume to be primarily driven by higher sales of equipment to end users, partially offset by the impact from changes indealer inventories. We expect a slight increase in dealer inventory in the third quarter of 2026, but modestly lower than the increase in the third quarter of 2025. In Resource Industries, we expect strong sales growth primarily due to higher sales volume. We expect higher sales volume to be mainly driven by higher sales of equipment to end users. We also expect services revenues growth in the third quarter of 2026 as compared to the third quarter of 2025. We anticipate favorable price realization in Resource Industries in the third quarter of 2026 as compared to the third quarter of 2025, but to a lesser extent than the second quarter of 2026 as compared to the second quarter of 2025.
Current wording
In Power & Energy, we anticipate moderate sales growth in the fourth quarter of 2026 as compared to the fourth quarter of 2025 as we continue to ramp capacity. We expect higher sales volume, driven by continued strength in Power Generation, modest growth in Oil & Gas and moderate growth in Industrial applications as it continues to recover. We also expect favorable price realization in Power & Energy. In Construction Industries, we expect similar sales in the fourth quarter of 2026 compared to the fourth quarter of 2025. We expect favorable price realization will be offset by modestly lower sales volume. This is mainly driven by a typical seasonal dealer inventory decrease of roughly $1.6 billion in the fourth quarter of 2026, compared with a decrease of $600 million in the fourth quarter of 2025. Despite the drawdown, we continue to expect dealer inventoriesat the end of 2026 to be higher than at the end of 2025 in anticipation of strong sales of equipment to end users in 2027. We expect the dealer inventory decrease to be partially offset by continued strong sales of equipment to end users growth. In Resource Industries, we expect strong sales growth in the fourth quarter of 2026 as compared to the fourth quarter of 2025. We anticipate higher sales volume to be driven by higher sales of equipment to end users and services revenues growth. We also expect favorable price realization in Resource Industries.
Previous wording
In the third quarter of 2026 as compared to the third quarter of 2025, we expect the profit impact of higher sales volume and favorable price realization to be partially offset by unfavorable manufacturing costsand higher selling, general and administrative (SG&A) and research and development (R&D) expenses.
Current wording
In the fourth quarter of 2026 as compared to the fourth quarter of 2025, we expect favorable price realization and the profit impact of higher sales volume to be partially offset by unfavorable manufacturing costs, excluding the impact of lower tariff costs, and higher selling, general & administrative (SG&A) and research and development (R&D) expenses.
Previous wording
In the third quarter of 2026 as compared to the third quarter of 2025, in Power & Energy, we anticipate the profit impact of higher sales volume and favorable price realization to be partially offset by unfavorable manufacturing costs and higher SG&A/R&D expenses. In Construction Industries, we anticipate favorable price realization and the profit impact of higher sales volume to be partially offset by unfavorable manufacturing costs and higher SG&A/R&D expenses. In Resource Industries, we anticipate the profit impact of higher sales volume and favorable price realization will be partially offset by unfavorable manufacturing costs and higher SG&A/R&D expenses.
Current wording
In the fourth quarter of 2026 as compared to the fourth quarter of 2025, in Power & Energy, we anticipate favorable price realization and the profit impact of higher sales volume to be partially offset by unfavorable manufacturing costs. In Construction Industries, we anticipate favorable price realization to be partially offset by the profit impact of lower sales volume, unfavorable manufacturing costs, excluding the impact of lower tariff costs, and higher SG&A/R&D expenses. In Resource Industries, we anticipate favorable price realization and the profit impact of higher sales volume to be partially offset by unfavorable manufacturing costs.
Previous wording
We anticipate tariff costs of around $600 million in the third quarter of 2026, which is similar to what was incurred in the third quarter of 2025. We expect about 50 percent of the tariff costs to be incurred in Construction Industries and 25 percent in both Power & Energy and Resource Industries.
Current wording
We anticipate tariff costs, excluding IEEPA tariff recoveries, of around $600 million in the fourth quarter of 2026, similar to the third quarter of 2026 but roughly $200 million lower than the fourth quarter of 2025. We continue to expect about 50 percent of the tariff costs to be incurred in Construction Industries and 25 percent in both Power & Energy and Resource Industries.
Previous wording
Excluding the expected IEEPA tariff recoveries in the second quarter of 2026, we now expect 2026 tariff costs of around $2.2 billion. Our outlook does not include any additional IEEPA tariff recoveries in the second half of 2026.
Current wording
Excluding IEEPA tariff recoveries of about $520 million, we continue to expect full-year 2026 tariff costs of around $2.2 billion. Our outlook does not include any additional IEEPA tariff recoveries in the fourth quarter of 2026.
Previous wording
In 2026, we continue to expect restructuring costs of approximately $300 to $350 million, and capital expenditures of approximately $3.5 billion. We anticipate our estimated annual effective tax rate to be 23.0 percent, excluding discrete items.
Current wording
In 2026, we now expect restructuring costs of about $300 million and capital expenditures of about $3.3 billion. We anticipate our estimated annual effective tax rate to be 23.0 percent, excluding discrete items.
Previous wording
During the second quarter of 2026, CBP launched the CAPE system, which enabled the submission of certain IEEPA refund claims. For both the three and six months ended June 30, 2026, the company recorded $392 million of expected IEEPA tariff recoveries for claims submitted and accepted through the CAPE system. These recoveries were deemed probable and were recorded in Current assets: Receivables - trade and other within the Consolidated Statement of Financial Position and in Cost of goods sold within the Consolidated Statement of Results of Operations.
Current wording
During the three and nine months ended September 30, 2026, the company recorded $128 million and $520 million, respectively, of IEEPA tariff recoveries for claims submitted and accepted through the CAPE system. These recoveries were deemed probable and were recorded in Cost of goods sold within the Consolidated Statement of Results of Operations.
Previous wording
•Glossary of terms is included on pages 65-67; first occurrence of terms shown in bold italics.
Current wording
•Glossary of terms is included on pages 66-68; first occurrence of terms shown in bold italics.
Previous wording
•Information on non-GAAP financial measures is included on pages 71-73.
Current wording
•Information on non-GAAP financial measures is included on pages 72-75.
Previous wording
The chart above graphically illustrates reasons for the change in consolidated sales and revenues between the second quarter of 2025 (at left) and the second quarter of 2026 (at right). Caterpillar management utilizes these charts internally to visually communicate with the company’s board of directors and employees.
Current wording
The chart above graphically illustrates reasons for the change in consolidated sales and revenues between the third quarter of 2025 (at left) and the third quarter of 2026 (at right). Caterpillar management utilizes these charts internally to visually communicate with the company’s board of directors and employees.
Previous wording
North America sales increased 39 percent due to higher sales volume and favorable price realization. The increase in sales volume was mainly driven by higher sales of equipment to end users.
Current wording
North America sales increased 25 percent due to higher sales volume and favorable price realization. The increase in sales volume was mainly driven by higher sales of equipment to end users.
Previous wording
Total dealer inventory increased $600 million during the second quarter of 2026, compared with an increase of $100 million during the second quarter of 2025. Construction Industries' dealer inventory increased by $400 million during the second quarter of 2026, compared with a $300 million decrease during the second quarter of 2025. Dealers are independent, and the reasons for changes in their inventory levels vary, including their expectations of future demand and product delivery times. Dealers’ demand expectations take into account seasonal changes, macroeconomic conditions, machine rentals and other factors. Delivery times can vary based on availability of product from Caterpillar factories and product distribution centers.
Current wording
Total dealer inventory increased $800 million during the third quarter of 2026, compared with an increase of $600 million during the third quarter of 2025. Construction Industries' dealer inventory increased by $300 million during the third quarter of 2026, compared with a $600 million increase during the third quarter of 2025. Dealers are independent, and the reasons for changes in their inventory levels vary, including their expectations of future demand and product delivery times. Dealers’ demand expectations take into account seasonal changes, macroeconomic conditions, machine rentals and other factors. Delivery times can vary based on availability of product from Caterpillar factories and product distribution centers.
Previous wording
1 Includes revenues from Machinery, Power & Energy of $210 million and $172 million in thesecond quarter of 2026 and 2025, respectively.
Current wording
1 Includes revenues from Machinery, Power & Energy of $218 million and $187 million in thethird quarter of 2026 and 2025, respectively.
Previous wording
The chart above graphically illustrates reasons for the change in consolidated operating profit between the second quarter of 2025 (at left) and the second quarter of 2026 (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, Power & Energy's other operating (income) expenses.
Current wording
The chart above graphically illustrates reasons for the change in consolidated operating profit between the third quarter of 2025 (at left) and the third quarter of 2026 (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, Power & Energy's other operating (income) expenses.
Previous wording
Operating profit in the second quarter of 2026 included $392 million of expected IEEPA tariff recoveries.
Current wording
Operating profit in the third quarter of 2026 included $128 million of International Emergency Economic Power Act (IEEPA) tariff recoveries.
Previous wording
Operating profit margin was 20.9 percent for the second quarter of 2026, compared with 17.3 percent for the second quarter of 2025.
Current wording
Operating profit margin was 20.4 percent for the third quarter of 2026, compared with 17.3 percent for the third quarter of 2025.
Previous wording
•Interest expense excluding Financial Products in the second quarter of 2026 was $135 million, compared with $126 million in the second quarter of 2025. The increase was primarily due to higher average debt outstanding.
Current wording
•Interest expense excluding Financial Products in the third quarter of 2026 was $129 million, compared with $133 million in the third quarter of 2025.
Previous wording
•Other income (expense) in the second quarter of 2026 was income of $398 million, compared with income of $84 million in the second quarter of 2025. The change was primarily driven by favorable impacts from foreign currency, total return swap contracts and investment and interest income.
Current wording
•Other income (expense) in the third quarter of 2026 was income of $135 million, compared with income of $208 million in the third quarter of 2025. The change was primarily driven by unfavorable impacts from total return swap contracts, partially offset by favorable impacts from commodity hedges.
Previous wording
•The effective tax rate for the second quarter of 2026 was 23.1 percent compared to 23.0 percent for the second quarter of 2025. Excluding the discrete items discussed below, the estimated annual effective tax rate was 23.0 percent for the second quarters of 2026 and 2025.
Current wording
•The effective tax rate for the third quarter of 2026 was 22.9 percent compared to 26.7 percent for the third quarter of 2025. Excluding the discrete items discussed below, the estimated annual effective tax rate was 23.0 percent for the third quarter of 2026 compared with 24.0 percent for the third quarter of 2025.
Previous wording
A discrete tax benefit of $26 million was recorded in the second quarter of 2026, compared with a $1 million benefit in the second quarter of 2025, for the settlement of stock-based compensation awards with associated tax deductions in excess of cumulative U.S. GAAP compensation expense.
Current wording
A discrete tax benefit of $3 million was recorded in the third quarter of 2026, compared with a $10 million benefit in the third quarter of 2025, for the settlement of stock-based compensation awards with associated tax deductions in excess of cumulative U.S. GAAP compensation expense.
Previous wording
Please see a reconciliation of GAAP to non-GAAP financial measures on pages 71-73.
Current wording
Please see a reconciliation of GAAP to non-GAAP financial measures on pages 72-75.
Previous wording
•Power Generation – Sales increased in large reciprocating engines and in turbines and turbine-related services, primarily in data center applications.
Current wording
•Power Generation – Sales increased mainly in turbines and turbine-related services and in large reciprocating engines, primarily in data center applications.
Previous wording
•Oil and Gas – Sales increased in reciprocating engines used in gas compression applications and in reciprocating engine aftermarket parts. Sales also increased in turbines and turbine-related services.
Current wording
•Oil and Gas – Sales increased primarily in reciprocating engine aftermarket parts and in reciprocating engines used in gas compression applications. Sales also increased in turbines and turbine-related services.
Previous wording
Power & Energy’s segment profit was $2.027 billion in the second quarter of 2026, an increase of $473 million, or 30 percent, compared with $1.554 billion in the second quarter of 2025. The increase was mainly due to the profit impact of higher sales volume of $457 million and favorable price realization of $212 million, partially offset by unfavorable manufacturing costs of $149 million. Unfavorable manufacturing costs largely reflected increased period manufacturing costs.
Current wording
Power & Energy’s segment profit was $2.143 billion in the third quarter of 2026, an increase of $510 million, or 31 percent, compared with $1.633 billion in the third quarter of 2025. The increase was mainly due to the profit impact of higher sales volume.
Showing the first 40 of 100 pairs. Open the source sections for the rest.
Rearranged current paragraphs (5)
Current report — wording carried from elsewhere
Sales increased 15 percent in Latin America primarily due to higher sales volume. Higher sales volume was mainly driven by the impact from changes in dealer inventories.
Current report — wording carried from elsewhere
•In North America, sales increased due to higher sales volume and favorable price realization. Higher sales volume was mainly driven by higher sales of equipment to end users.
Current report — wording carried from elsewhere
•In North America, sales increased primarily due to higher sales volume and favorable price realization. Higher sales volume was mainly driven by higher sales of equipment to end users.
Current report — wording carried from elsewhere
•Sales increased in Latin America mainly due to higher sales volume. Higher sales volume was primarily driven by the impact from changes in dealer inventories.
Current report — wording carried from elsewhere
•Rail – Sales increased in rail services.
Rearranged previous paragraphs (4)
Previous report — wording carried elsewhere
In addition, the estimated annual effective tax rate in the second quarter of 2026 excluded the impact of second quarter losses of $139 million for the divestiture of certain non-U.S. entities with no related tax benefit.
Previous report — wording carried elsewhere
•Sales increased in Asia/Pacific mainly due to higher sales volume. Higher sales volume was primarily driven by higher sales of equipment to end users.
Previous report — wording carried elsewhere
In addition, the 2026 estimated annual effective tax rate excluded the impact of losses of $139 million for the divestiture of certain non-U.S. entities with no related tax benefit.
Previous report — wording carried elsewhere
•Industrial – Sales increased primarily in North America and EAME.