10-QPeriod: Q3 FY2022

CATERPILLAR INC Quarterly Report for Q3 Ended Sep 30, 2022

Filed November 2, 2022For Securities:CAT

Summary

Caterpillar Inc. reported a strong third quarter of 2022, with total sales and revenues increasing by 21% year-over-year to $14.994 billion. This growth was driven by higher sales volume and favorable price realization across its primary segments, partially offset by unfavorable currency impacts. The company also saw a significant improvement in operating profit, which rose by 46% to $2.425 billion, leading to a higher operating profit margin of 16.2% compared to 13.4% in the prior year. Profit per share also saw a substantial increase, reaching $3.87 for the third quarter of 2022, up from $2.60 in the same period last year. For the first nine months of the year, total sales and revenues grew 15% to $42.830 billion, with operating profit increasing by 18%. The company ended the quarter with a solid enterprise cash position of $6.3 billion, demonstrating robust financial health.

Financial Highlights

53 data points
Beta

Revenue

$14.99B

32.0% Gross Margin

Net Income

$2.04B

13.6% Net Margin

EPS (Diluted)

$3.87

Total Assets

$80.91B

Cash & Equivalents

$6.36B

Free Cash Flow

$2.20B

Financial Statements
Beta
Revenue$14.99B
Cost of Revenue$10.20B
Gross Profit$4.79B
R&D Expenses$476.00M
SG&A Expenses$1.40B
Operating Expenses$12.57B
Operating Income$2.42B
Net Income$2.04B
EPS (Basic)$3.89
EPS (Diluted)$3.87
Shares Outstanding (Basic)525.00M
Shares Outstanding (Diluted)527.60M

Key Highlights

  • 1Total sales and revenues for Q3 2022 increased by 21% to $14.994 billion, driven by higher sales volume and price realization.
  • 2Operating profit increased by 46% to $2.425 billion in Q3 2022, with operating profit margin improving to 16.2% from 13.4% in Q3 2021.
  • 3Profit per share (diluted) for Q3 2022 was $3.87, a significant increase from $2.60 in Q3 2021.
  • 4For the nine months ended September 30, 2022, total sales and revenues grew 15% to $42.830 billion, and operating profit increased by 18%.
  • 5Enterprise cash at the end of Q3 2022 was $6.3 billion.
  • 6Dealers' inventory levels increased by $700 million in Q3 2022, compared to a decrease of $300 million in Q3 2021, indicating strong demand and dealer confidence.
  • 7Caterpillar reached a settlement with the IRS for tax years 2007-2016, resulting in a discrete tax benefit of $41 million in Q3 2022.

Frequently Asked Questions

The revenue increase was primarily driven by favorable price realization and higher sales volume across Caterpillar's segments. An increase in dealer inventories also contributed to higher sales volume compared to the prior year.

Profitability saw a significant improvement. Operating profit increased by 46% to $2.425 billion, and the operating profit margin expanded to 16.2% from 13.4%. This was attributed to favorable price realization, higher sales volume, and effective cost management despite higher material and freight costs.

Caterpillar ended Q3 2022 with $6.3 billion in enterprise cash. The company's capital allocation strategy prioritizes maintaining a strong financial position, funding operational requirements, investing in strategic growth initiatives, and returning capital to shareholders through dividends and share repurchases.

Yes, Caterpillar reached a settlement with the IRS for tax years 2007-2016, resolving all issues without penalties. This resulted in a discrete tax benefit of $41 million recorded in Q3 2022.