Caterpillar (CAT) Q4 2025 Earnings
How Did CAT Stock React to Q4 2025 Earnings?
S&P 500 over the same 30 days: −1.98%.
Did CAT Beat Earnings? Q4 2025 Results
Yes. Caterpillar reported Q4 2025 earnings of $5.16 a share on Jan 29, 2026, beating the $4.71 consensus estimate by 9.5%. Revenue was $19.1B against a $17.8B estimate.
Caterpillar closed out its centennial year with a decisive earnings beat, as the industrial giant's booming Power & Energy division helped drive fourth-quarter revenue to $19.13 billion, up 18% year-over-year and well ahead of the $17.76 billion consensus estimate. Earnings per share of $5.16 topped analyst expectations of $4.71 by 9.51%, though the headline strength masked notable margin pressure beneath the surface. The standout driver was Power Generation demand, particularly large reciprocating engines supplying data centers, which pushed the Power & Energy segment up 23% to $9.40 billion and underscores Caterpillar's growing role in AI infrastructure buildout. That volume tailwind, however, was partially offset by $1.03 billion in tariff-related manufacturing costs that compressed operating margin to 13.9% from 18.0% a year ago, a headwind analysts have flagged as a key risk for the stock. Entering 2026 with a record backlog, Caterpillar faces a dual challenge: converting strong order momentum into earnings while navigating persistent cost pressures from tariffs and a higher effective tax rate of 24.1%.
- Higher sales volume of $2.708 billion primarily driven by higher sales of equipment to end users and dealer inventory dynamics
- Power Generation sales surged 44% driven by large reciprocating engines for data center applications
- Oil and Gas turbines and turbine-related services drove 24% growth
- Dealer inventory remained about flat in Q4 2025 vs a $1.3 billion decrease in Q4 2024
- Record backlog entering 2026
“Our centennial year marked a significant milestone, underscored by the highest full-year sales and revenues in Caterpillar's history and a single-quarter record of $19.1 billion. These results demonstrate the strength of our end markets and our disciplined execution. With a record backlog, we enter the new year with strong momentum and a continued focus on delivering long-term value for our customers and shareholders.”
Caterpillar CEO, on the earnings call
What Was Caterpillar's Outlook in Q4 2025?
Caterpillar entered 2026 with a record backlog and strong momentum. CEO Joe Creed emphasized continued focus on delivering long-term value for customers and shareholders. However, the company faces headwinds from higher tariff-related manufacturing costs, which significantly impacted margins across all three primary segments in Q4 2025. The company also noted unfavorable price realization trends and a higher global annual effective tax rate of 24.1% versus 22.2% in 2024, primarily due to changes in U.S. tax incentives.
CAT YoY Financials
| Metric | Q4 2025 | Q4 2024 | Year over year |
|---|---|---|---|
| Revenue | $19.1B | $16.2B | +18.0% |
| Gross Profit | $5.8B | $5.6B | +4.9% |
| Operating Income | $2.7B | $2.9B | −9.0% |
| Net Income | $2.4B | $2.8B | −13.9% |
CAT Revenue by Segment
CAT Revenue by Geography
Figures from SEC filings and company reports. Not investment advice.