Caterpillar profit jumps 30% on construction rebound
The heavy-equipment maker posted adjusted earnings of $5.54 a share for the quarter.
The heavy-equipment manufacturer Caterpillar (CAT) reported first-quarter profit that rose 30% from a year earlier, driven by a rebound in construction demand and higher pricing.
The results marked a sharp turnaround after two quarters of year-over-year profit declines, reflecting stronger sales volumes and a recovery in dealer inventories that had weighed on prior periods. Revenue growth accelerated to 22% from single-digit gains in the second half of 2025, though margin pressure persisted amid higher manufacturing costs.
Sales and revenues climbed 22% to $17.4 billion, up from $14.3 billion a year earlier. Profit per share rose to $5.47, or $5.54 on an adjusted basis, compared with $4.20 and $4.25, respectively, in the prior-year quarter. The company said higher sales volume contributed $2.3 billion to revenue, while favorable price realization added $426 million.
The Construction Industries segment led the rebound, with sales surging 38% to $7.161 billion and profit jumping 50% to $1.535 billion. Segment profit margin expanded to 21.4% from 19.8% a year earlier, reversing a decline that had stretched through 2025. Dealer inventory increases in the quarter supported the volume growth, the company said.
Power & Energy sales grew 22% to $7.031 billion, with Power Generation revenue climbing 41% on demand from data center projects. Segment profit rose 13% to $1.450 billion, though margin compressed to 20.6% from 22.3% a year earlier. Resource Industries sales increased 4% to $3.797 billion, but profit fell 39% to $378 million as higher tariffs and manufacturing costs offset gains.
Caterpillar raised its quarterly dividend by 8% to $1.63 a share, extending its streak of annual increases to 32 years. The company deployed $5.7 billion in free cash flow toward share repurchases and dividends, up from $1.1 billion in the prior quarter. Operating cash flow, however, declined to $1.9 billion from $3.7 billion in the third quarter of 2025.
The company did not provide updated guidance for the full year, but said its backlog remained strong, supporting future sales momentum.