Caterpillar Q2 2026 Earnings: Record Revenue Fueled by Data Center Demand
Caterpillar posted record $20.5B quarterly revenue and beat profit estimates, fueled by a data-center-driven power equipment boom, and raised its full-year sales outlook.
| Q2 2026 | Reported | Expected | Surprise |
|---|---|---|---|
| EPS | $8.17 | $6.26 | +30.5% |
| Revenue | $20.54B | $19.53B | +5.2% |
Key takeaways
- Both profit and revenue beat Wall Street forecasts by a wide margin, and revenue topped $20 billion in a single quarter for the first time in the company’s history, up 24% from a year earlier.
- Growth was broad-based across all three main business units: construction equipment sales jumped 35% (with North American demand up 50%), power generation equipment sales rose 17%, and mining/resource equipment sales grew 20%.
- A major driver was demand for backup and standby power generators used in data centers being built for cloud computing and AI — that part of the power business grew 29% in the quarter.
- Caterpillar’s order backlog swelled to a record $72 billion, roughly double a year ago, giving the company strong visibility into future sales.
- The TTM operating margin of about 16.5% and net margin of about 13.3% show the company is still converting a healthy share of sales into profit even after absorbing new cost pressures, while return on equity near 48% points to efficient use of shareholder capital.
- Management raised its full-year 2026 sales growth outlook to the mid-to-high teens percentage range and said it now expects free cash flow from its core equipment business to land in the top half of its previous target range, both signs of confidence in demand holding up through year-end.
- Tariffs remain a real cost headwind: the company absorbed about $400 million in tariff-related costs in the quarter and expects roughly $2.2 billion for the full year, which is weighing on segment profit margins even as sales grow.
- Caterpillar flagged that construction dealers are expected to trim inventory levels in the second half of the year, including a typical fourth-quarter pullback, which could soften sales growth in that segment later in 2026.
- Shares jumped roughly 9% in premarket trading following the results, reflecting investor reaction to the earnings beat and improved guidance.
Q2 2026 in context
| Metric | Jun 2026 | Jun 2025 | Change |
|---|---|---|---|
| Revenue | $20.5B | $16.6B | +24.0% |
| Net income | $3.6B | $2.2B | +64.9% |
| Free cash flow | $3.8B | $2.6B | +47.4% |
| Diluted EPS | $7.77 | $4.62 | +68.2% |
| Gross margin | 37.8% | 34.8% | +3.0 pts |
| Operating margin | 20.9% | 17.3% | +3.6 pts |
| Net margin | 17.5% | 13.2% | +4.3 pts |
Figures for the quarter ended Jun 2026 and the quarter ended Jun 2025, as reported to the SEC.
How the stock took it
Caterpillar Inc closed at $830.03 on Aug 3, 2026, the last session before the report, and at $871.08 on Aug 5, 2026, the first session after it — +5.0% across the report.
| Earlier report | Close before | Close after | Change |
|---|---|---|---|
| May 6, 2026 | $904.59 | $895.69 | -1.0% |
| Mar 26, 2026 | $719.04 | $695.40 | -3.3% |
Closes from the market's daily record. Each figure spans the report date — from the last session that closed before it to the first that closed after — because a company may report before the open or after the close.
Fundamentals
| Metric | Value | Period |
|---|---|---|
| Gross margin | 33.8% | Trailing 12 months |
| Operating margin | 16.5% | Trailing 12 months |
| Net profit margin | 13.3% | Trailing 12 months |
| Pretax margin | 17.2% | Trailing 12 months |
| EPS | $20.10 | Trailing 12 months |
| Revenue growth (YoY) | 11.8% | Trailing 12 months |
| EPS growth (YoY) | -2.1% | Trailing 12 months |
| Return on equity | 47.6% | Trailing 12 months |
Sources: company report · earnings call · Benzinga