01—Abstract
Summary
Summary of the 10-Q filed November 3, 2025. Cited figures are marked; the original filing is the authoritative source.
Caterpillar Inc. reported its financial results for the third quarter and the first nine months of 2025.
For the third quarter, total sales and revenues increased by 10% to $17.638 billiona, primarily driven by higher sales volume across all major segments. However, operating profit margin decreased to 17.3% from 19.5% in the prior year's quarter, impacted by unfavorable manufacturing costs, notably due to higher tariffs, and increased selling, general, and administrative (SG&A) and R&D expenses. Profit per share for the quarter was $4.88, down from $5.06 in Q3 2024.
For the first nine months of 2025, total sales and revenues remained relatively flat at $48.456 billionb. Operating profit margin saw a more significant decline to 17.5% from 20.9% in the same period last year, largely due to unfavorable manufacturing costs and price realization, again impacted by tariffs.
Profit per share for the nine-month period was $13.69c, a decrease from $16.27 in the prior year. The company noted healthy demand signals and a robust backlog, with expectations for modest full-year sales and revenue growth in 2025, though tempered by ongoing tariff impacts and global economic uncertainties.
02—Key points
Key Highlights
- Total sales and revenues for Q3 2025 increased by 10% to $17.638 billion, driven by higher sales volume across Construction Industries, Resource Industries, and Energy & Transportation.
- Operating profit margin for Q3 2025 decreased to 17.3% from 19.5% in Q3 2024, impacted by unfavorable manufacturing costs (largely due to higher tariffs) and increased SG&A/R&D expenses.
- Profit per share for Q3 2025 was $4.88, a decrease from $5.06 in Q3 2024.
- For the nine months ended September 30, 2025, total sales and revenues were largely flat at $48.456 billion.
- Operating profit margin for the nine months decreased to 17.5% from 20.9% in the prior year, mainly due to unfavorable manufacturing costs and price realization.
- Profit per share for the nine months ended September 30, 2025, was $13.69, down from $16.27 in the prior year.
- The company anticipates a net incremental tariff impact of approximately $650 million to $800 million in the fourth quarter of 2025.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q3 FY2025, Caterpillar Inc kept $0.13.
- Revenue$17.64B100.0%
- Cost of revenue−$11.67B66.2%
- Gross profit$5.96B33.8%
- Operating costs−$2.91B16.5%
- Operating income$3.05B17.3%
- Interest, other & tax−$752.0M4.3%
- Net income$2.30B13.0%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2025filed November 3, 2025Financial Statements
Q3 FY2025 against Q3 FY2024
| Line item | Q3 FY2025Q3 FY2024 | Change |
|---|---|---|
| Revenue | $17.64B$16.11B | +9.5% |
| Cost of Revenue | $11.67B$10.07B | +16.0% |
| Gross Profit | $5.96B$6.04B | −1.2% |
| R&D Expenses | $555.00M$533.00M | +4.1% |
| SG&A Expenses | $1.82B$1.67B | +9.2% |
| Operating Expenses | $14.59B$12.96B | +12.6% |
| Operating Income | $3.05B$3.15B | −3.0% |
| Net Income | $2.30B$2.46B | −6.7% |
| EPS (Basic) | $4.91$5.09 | −3.5% |
| EPS (Diluted) | $4.88$5.06 | −3.6% |
| Shares Outstanding (Basic) | 468.60M484.20M | −3.2% |
| Shares Outstanding (Diluted) | 470.80M486.70M | −3.3% |
05—Questions
Frequently Asked Questions
What was the primary driver of the sales increase in the third quarter of 2025?
The primary driver of the sales increase in the third quarter of 2025 was higher sales volume, particularly in the Construction Industries, Resource Industries, and Energy & Transportation segments, largely due to increased sales of equipment to end users and a less pronounced decrease in dealer inventories compared to the prior year.
What factors led to the decline in operating profit margin?
The decline in operating profit margin for both the third quarter and the nine-month period was primarily attributed to unfavorable manufacturing costs, significantly influenced by higher tariffs. Additionally, unfavorable price realization and increased selling, general, and administrative (SG&A) and research and development (R&D) expenses contributed to the margin compression.
How is Caterpillar managing the impact of tariffs?
Caterpillar is actively evaluating options to mitigate the impact of incremental tariffs and plans to implement longer-term actions once there is greater certainty. The company expects a net incremental tariff impact of approximately $1.6 billion to $1.75 billion for the full year 2025 and has already incurred a significant portion of this impact, with a notable portion expected in the fourth quarter.
What is the outlook for the company's key end markets?
Caterpillar anticipates modest full-year sales and revenue growth in 2025, supported by healthy demand signals and a robust backlog. Growth is expected in Construction Industries, driven by infrastructure projects, and strong performance in Power Generation within Energy & Transportation. However, Resource Industries may see lower sales due to customer capital discipline and declining coal prices, while some regions face softer economic conditions.
06—Continue