MW Data-center demand helps Caterpillar to best quarter ever - but there's a tariff sting

By Jamie Chisholm

The bulldozer-maker's backlog hits a record

Caterpillar

Caterpillar Inc. shares jumped early Thursday before giving up a chunk of their gains as investors welcomed news of a record order backlog and the biggest quarterly earnings ever, but balked at projections of a multibillion-dollar tariff hit.

The construction-machinery maker said sales and revenues in the fourth quarter of 2025 totaled $19.1 billion, an 18% increase over the $16.2 billion in the fourth quarter of 2024.

Much of the increase came from the power and energy division, which grew sales and revenues by 23% to $9.4 billion, amid surging power-generation construction for data centers.

Adjusted profit per share of $5.16 in the fourth quarter beat analysts' estimates of $4.71, according to FactSet.

The company's backlog increased by 71% from a year ago and now stands at a record of $51 billion.

Caterpillar said it expected sales for the first quarter of 2026 to be "stronger" compared with the same period in 2025.

"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," said Caterpillar CEO Joe Creed.

"These results demonstrate the strength of our end markets and our disciplined execution," he added. "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."

The news wasn't all positive; Caterpillar expects a $2.6 billion hit in 2026 from higher tariffs.

The impact of those incremental tariff costs means that the adjusted operating profit margin is expected to be lower in the first quarter of 2026, compared with a year ago, the company said.

Excitement about Caterpillar's role in AI build-out construction has helped lift its shares $(CAT)$ to a record high, with the stock up 72% over the last 12 months. The shares jumped 6% shortly after the results were released on Thursday, trading at a new peak, which was above $680, but later pared the gains to $652 - a 1% jump.

-Jamie Chisholm

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January 29, 2026 08:06 ET (13:06 GMT)

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