01—Abstract
Summary
Summary of the 10-Q filed November 6, 2024. Cited figures are marked; the original filing is the authoritative source.
Caterpillar Inc. (CAT) reported a decrease in total sales and revenues for the third quarter of 2024, down 4% to $16.106 billiona compared to the same period in 2023.
This decline was primarily driven by lower sales volumes, particularly in the Construction Industries and Resource Industries segments, while Energy & Transportation showed growth. Despite the revenue dip, the company maintained a strong operating profit margin of 19.5%. Diluted earnings per share (EPS) for the quarter were $5.06b, a decrease from $5.45 in the prior year, reflecting the lower sales and profit.
For the first nine months of 2024, total sales and revenues decreased by 3% to $48.594 billionc, but operating profit margin improved to 20.9% from 19.7% year-over-year. The company ended the third quarter with a solid enterprise cash position of $5.6 billion, demonstrating continued financial health. Looking ahead, Caterpillar anticipates slightly lower total sales and revenues for the fourth quarter of 2024 compared to the prior year, primarily due to continued moderation in machine sales to end users and normalizing pricing environments.
However, services revenue is expected to grow, and the company continues to invest in strategic initiatives for long-term profitable growth. The outlook for the Energy & Transportation segment remains robust, particularly in Power Generation, driven by demand from data centers. Investors should monitor the evolving global economic conditions and their impact on demand for Caterpillar's core products.
02—Key points
Key Highlights
- Total sales and revenues decreased by 4% to $16.106 billion in Q3 2024 compared to Q3 2023, driven by lower sales volume.
- Operating profit margin remained strong at 19.5% in Q3 2024, though slightly down from 20.5% in Q3 2023.
- Diluted earnings per share (EPS) decreased to $5.06 in Q3 2024 from $5.45 in Q3 2023.
- For the nine months ended September 30, 2024, sales decreased 3% to $48.594 billion, but operating profit margin improved to 20.9%.
- The company ended Q3 2024 with $5.6 billion in enterprise cash.
- Construction Industries and Resource Industries segments experienced sales declines, while Energy & Transportation saw an increase.
- Caterpillar anticipates slightly lower total sales for Q4 2024 compared to Q4 2023, driven by moderating machine sales and pricing.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q3 FY2024, Caterpillar Inc kept $0.15.
- Revenue$16.11B100.0%
- Cost of revenue−$10.07B62.5%
- Gross profit$6.04B37.5%
- Operating costs−$2.89B18.0%
- Operating income$3.15B19.5%
- Interest, other & tax−$683.0M4.2%
- Net income$2.46B15.3%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2024filed November 6, 2024Financial Statements
Q3 FY2024 against Q3 FY2023
| Line item | Q3 FY2024Q3 FY2023 | Change |
|---|---|---|
| Revenue | $16.11B$16.81B | −4.2% |
| Cost of Revenue | $10.07B$10.58B | −4.9% |
| Gross Profit | $6.04B$6.23B | −3.0% |
| R&D Expenses | $533.00M$554.00M | −3.8% |
| SG&A Expenses | $1.67B$1.62B | +2.8% |
| Operating Expenses | $12.96B$13.36B | −3.0% |
| Operating Income | $3.15B$3.45B | −8.8% |
| Net Income | $2.46B$2.79B | −11.8% |
| EPS (Basic) | $5.09$5.48 | −7.1% |
| EPS (Diluted) | $5.06$5.45 | −7.2% |
| Shares Outstanding (Basic) | 484.20M509.80M | −5.0% |
| Shares Outstanding (Diluted) | 486.70M512.60M | −5.1% |
05—Questions
Frequently Asked Questions
What drove the decrease in Caterpillar's sales and revenues in the third quarter of 2024?
Caterpillar's total sales and revenues decreased by 4% to $16.106 billion in the third quarter of 2024 compared to the same period in 2023. This decline was primarily attributed to a lower sales volume, mainly due to reduced equipment sales to end users and a less favorable impact from changes in dealer inventories compared to the prior year.
How did the different business segments perform in the third quarter of 2024?
Sales were down in the Construction Industries (9% decrease) and Resource Industries (10% decrease) segments. Conversely, the Energy & Transportation segment saw an increase in sales of 5%, driven by strong performance in Power Generation, while the Financial Products segment also reported a 6% increase in revenues.
What is Caterpillar's outlook for the fourth quarter of 2024?
Caterpillar expects slightly lower total sales and revenues for the fourth quarter of 2024 compared to the fourth quarter of 2023. This is anticipated due to continued moderation in machine sales to end users and a normalizing pricing environment. However, the company expects services revenue to grow and remains optimistic about strategic growth initiatives and the Energy & Transportation segment.
What is Caterpillar's current financial position and cash flow status?
Caterpillar ended the third quarter of 2024 with a strong enterprise cash position of $5.6 billion. For the first nine months of 2024, the company generated $8.64 billion in net cash provided by operating activities, reflecting a solid liquidity profile.
06—Continue