Document: SEC Filing

Company: Caterpillar Inc.
Ticker: CAT
CIK: 18230
Form Type: 10-Q
Filing Date: 2025-11-03
Accession Number: 0000018230-25-000048
Source: 10-Q_2025-11-03_0000018230-25-000048.txt

---

Table of Contents

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549
 
FORM 
10-Q
 

☒
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended
September 30, 2025
OR
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                    to
Commission File Number:  
1-768

CATERPILLAR INC
.
(Exact name of registrant as specified in its charter)
Delaware 37-0602744
(State or other jurisdiction of incorporation) (IRS Employer I.D. No.)
5205 N. O'Connor Boulevard, Suite 100, Irving, Texas 75039
(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code:
(
972
)
891-7700
 
Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report:
N/A
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbol(s) Name of each exchange on which registered
Common Stock ($1.00 par value) CAT New York Stock Exchange
5.3% Debentures due September 15, 2035 CAT35 New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. 
Yes

☒
    No  
☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  
Yes

☒
  No
☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company.  See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. 
Large accelerated filer ☒ Accelerated filer ☐
Non-accelerated filer ☐ Smaller reporting company ☐
Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes
☐
  No
☒
At September 30, 2025,
467,979,596
shares of common stock of the registrant were outstanding.

Table of Contents
Table of Contents
 
Part I. Financial Information
Item 1. Financial Statements 3
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 49
Item 3. Quantitative and Qualitative Disclosures About Market Risk 79
Item 4. Controls and Procedures 79
Part II. Other Information
Item 1. Legal Proceedings 80
Item 1A. Risk Factors 80
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 80
Item 3. Defaults Upon Senior Securities *
Item 4. Mine Safety Disclosures *
Item 5. Other Information 80
Item 6. Exhibits 81

 
* Item omitted because no answer is called for or item is not applicable.
2
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Part I.  FINANCIAL INFORMATION
 
Item 1.  Financial Statements

Caterpillar Inc.
Consolidated Statement of Results of Operations
(Unaudited)
(Dollars in millions except per share data)
Three Months Ended September 30,
2025 2024
Sales and revenues:
Sales of Machinery, Energy & Transportation $ 16,726 $ 15,231
Revenues of Financial Products 912 875
Total sales and revenues 17,638 16,106
Operating costs:
Cost of goods sold 11,673 10,066
Selling, general and administrative expenses 1,822 1,669
Research and development expenses 555 533
Interest expense of Financial Products 346 336
Other operating (income) expenses 190 355
Total operating costs 14,586 12,959
Operating profit 3,052 3,147
Interest expense excluding Financial Products 133 125
Other income (expense) 208 76
Consolidated profit before taxes 3,127 3,098
Provision (benefit) for income taxes 836 642
Profit of consolidated companies 2,291 2,456
Equity in profit (loss) of unconsolidated affiliated companies 8 7
Profit of consolidated and affiliated companies 2,299 2,463
Less: Profit (loss) attributable to noncontrolling interests ( 1 ) ( 1 )
Profit 1 $ 2,300 $ 2,464
Profit per common share $ 4.91 $ 5.09
Profit per common share – diluted 2 $ 4.88 $ 5.06
Weighted-average common shares outstanding (millions)
– Basic 468.6 484.2
– Diluted 2 470.8 486.7

1  
 
Profit attributable to common shareholders.
2
   
Diluted by assumed exercise of stock-based compensation awards using the treasury stock method.
See accompanying notes to Consolidated Financial Statements.

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Caterpillar Inc
.
Consolidated Statement of Comprehensive Income
(Unaudited)
(Dollars in millions)
Three Months Ended September 30,
2025 2024
Profit of consolidated and affiliated companies $ 2,299 $ 2,463
Other comprehensive income (loss), net of tax (Note 13):
Foreign currency translation ( 30 ) 397
Pension and other postretirement benefits — ( 3 )
Derivative financial instruments ( 21 ) 58
Available-for-sale securities 12 61
Total other comprehensive income (loss), net of tax ( 39 ) 513
Comprehensive income 2,260 2,976
Less: comprehensive income (loss) attributable to the noncontrolling interests ( 1 ) ( 1 )
Comprehensive income attributable to shareholders $ 2,261 $ 2,977

See accompanying notes to Consolidated Financial Statements.

4
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Caterpillar Inc.
Consolidated Statement of Results of Operations
(Unaudited)
(Dollars in millions except per share data)
Nine Months Ended September 30,
2025 2024
Sales and revenues:
Sales of Machinery, Energy & Transportation $ 45,778 $ 46,031
Revenues of Financial Products 2,678 2,563
Total sales and revenues 48,456 48,594
Operating costs:
Cost of goods sold 31,445 29,878
Selling, general and administrative expenses 5,109 4,898
Research and development expenses 1,586 1,588
Interest expense of Financial Products 1,008 948
Other operating (income) expenses 817 1,134
Total operating costs 39,965 38,446
Operating profit 8,491 10,148
Interest expense excluding Financial Products 375 405
Other income (expense) 399 387
Consolidated profit before taxes 8,515 10,130
Provision (benefit) for income taxes 2,056 2,166
Profit of consolidated companies 6,459 7,964
Equity in profit (loss) of unconsolidated affiliated companies 22 34
Profit of consolidated and affiliated companies 6,481 7,998
Less: Profit (loss) attributable to noncontrolling interests ( 1 ) ( 3 )
Profit 1 $ 6,482 $ 8,001
Profit per common share $ 13.76 $ 16.36
Profit per common share – diluted 2 $ 13.69 $ 16.27
Weighted-average common shares outstanding (millions)
– Basic 471.3 489.0
– Diluted 2 473.4 491.7

1  
 
Profit attributable to common shareholders.
2
   
Diluted by assumed exercise of stock-based compensation awards using the treasury stock method.
 
See accompanying notes to Consolidated Financial Statements.

5
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Caterpillar Inc
.
Consolidated Statement of Comprehensive Income
(Unaudited)
(Dollars in millions)
Nine Months Ended September 30,
2025 2024
Profit of consolidated and affiliated companies $ 6,481 $ 7,998
Other comprehensive income (loss), net of tax (Note 13):
Foreign currency translation 593 69
Pension and other postretirement benefits ( 2 ) ( 9 )
Derivative financial instruments 99 ( 4 )
Available-for-sale securities 58 47
Total other comprehensive income (loss), net of tax 748 103
Comprehensive income 7,229 8,101
Less: comprehensive income (loss) attributable to the noncontrolling interests ( 1 ) ( 3 )
Comprehensive income attributable to shareholders $ 7,230 $ 8,104

See accompanying notes to Consolidated Financial Statements.

6
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Caterpillar Inc
.
Consolidated Statement of Financial Position
(Unaudited)
(Dollars in millions)
 
September 30, 2025 December 31, 2024
Assets
Current assets:
Cash and cash equivalents $ 7,538 $ 6,889
Receivables – trade and other 10,146 9,282
Receivables – finance 10,315 9,565
Prepaid expenses and other current assets 2,861 3,119
Inventories 18,958 16,827
Total current assets 49,818 45,682
Property, plant and equipment – net 14,310 13,361
Long-term receivables – trade and other 1,618 1,225
Long-term receivables – finance 13,985 13,242
Noncurrent deferred and refundable income taxes 3,000 3,312
Intangible assets 281 399
Goodwill 5,329 5,241
Other assets 5,381 5,302
Total assets $ 93,722 $ 87,764
Liabilities
Current liabilities:
Short-term borrowings:
Financial Products $ 4,509 $ 4,393
Accounts payable 8,729 7,675
Accrued expenses 5,187 5,243
Accrued wages, salaries and employee benefits 2,126 2,391
Customer advances 3,391 2,322
Dividends payable — 674
Other current liabilities 2,760 2,909
Long-term debt due within one year:
Machinery, Energy & Transportation 32 46
Financial Products 9,257 6,619
Total current liabilities 35,991 32,272
Long-term debt due after one year:
Machinery, Energy & Transportation 10,669 8,564
Financial Products 17,067 18,787
Liability for postemployment benefits 3,664 3,757
Other liabilities 5,672 4,890
Total liabilities 73,063 68,270
Commitments and contingencies (Notes 11 and 14)
Shareholders’ equity
Common stock of $ 1.00 par value:
Authorized shares: 2,000,000,000 Issued shares: (9/30/25 and 12/31/24 – 814,894,624 ) at paid-in amount 6,223 6,941
Treasury stock: (9/30/25 – 346,915,028 shares; 12/31/24 – 336,962,600 shares) at cost ( 48,302 ) ( 44,331 )
Profit employed in the business 64,460 59,352
Accumulated other comprehensive income (loss) ( 1,723 ) ( 2,471 )
Noncontrolling interests 1 3
Total shareholders’ equity 20,659 19,494
Total liabilities and shareholders’ equity $ 93,722 $ 87,764

See accompanying notes to Consolidated Financial Statements.

7
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Caterpillar Inc.
Consolidated Statement of Changes in Shareholders’ Equity
(Unaudited)
(Dollars in millions)
 
Common stock Treasury stock Profit employed in the business Accumulated other comprehensive income (loss) Noncontrolling interests Total
Three Months Ended September 30, 2024
Balance at June 30, 2024 $ 5,517 $ ( 41,612 ) $ 55,455 $ ( 2,230 ) $ 6 $ 17,136
Profit (loss) of consolidated and affiliated companies — — 2,464 — ( 1 ) 2,463
Foreign currency translation, net of tax — — — 397 — 397
Pension and other postretirement benefits, net of tax — — — ( 3 ) — ( 3 )
Derivative financial instruments, net of tax — — — 58 — 58
Available-for-sale securities, net of tax — — — 61 — 61
Dividends declared — — 1 — — 1
Common shares issued from treasury stock for stock-based compensation: 202,087 ( 4 ) 10 — — — 6
Stock-based compensation expense 52 — — — — 52
Common shares repurchased: 2,297,715 1 — ( 782 ) — — — ( 782 )
Other 19 ( 6 ) — — 1 14
Balance at September 30, 2024 $ 5,584 $ ( 42,390 ) $ 57,920 $ ( 1,717 ) $ 6 $ 19,403
Three Months Ended September 30, 2025
Balance at June 30, 2025 $ 6,143 $ ( 47,958 ) $ 62,160 $ ( 1,684 ) $ 2 $ 18,663
Profit (loss) of consolidated and affiliated companies — — 2,300 — ( 1 ) 2,299
Foreign currency translation, net of tax — — — ( 30 ) — ( 30 )
Pension and other postretirement benefits, net of tax — — — — — —
Derivative financial instruments, net of tax — — — ( 21 ) — ( 21 )
Available-for-sale securities, net of tax — — — 12 — 12
Common shares issued from treasury stock for stock-based compensation: 348,672 — 19 — — — 19
Stock-based compensation expense 71 — — — — 71
Common shares repurchased: 847,999 1 — ( 362 ) — — — ( 362 )
Other 9 ( 1 ) — — — 8
Balance at September 30, 2025 $ 6,223 $ ( 48,302 ) $ 64,460 $ ( 1,723 ) $ 1 $ 20,659

1

See Note 12 for additional information.
See accompanying notes to Consolidated Financial Statements.

8
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Caterpillar Inc.
Consolidated Statement of Changes in Shareholders’ Equity
(Unaudited)
(Dollars in millions)
 
Common stock Treasury stock Profit employed in the business Accumulated other comprehensive income (loss) Noncontrolling interests Total
Nine Months Ended September 30, 2024
Balance at December 31, 2023 $ 6,403 $ ( 36,339 ) $ 51,250 $ ( 1,820 ) $ 9 $ 19,503
Profit (loss) of consolidated and affiliated companies — — 8,001 — ( 3 ) 7,998
Foreign currency translation, net of tax — — — 69 — 69
Pension and other postretirement benefits, net of tax — — — ( 9 ) — ( 9 )
Derivative financial instruments, net of tax — — — ( 4 ) — ( 4 )
Available-for-sale securities, net of tax — — — 47 — 47
Dividends declared 1 — — ( 1,331 ) — — ( 1,331 )
Common shares issued from treasury stock for stock-based compensation: 1,629,444 ( 45 ) 59 — — — 14
Stock-based compensation expense 171 — — — — 171
Common shares repurchased: 18,204,255 2 — ( 6,057 ) — — — ( 6,057 )
Outstanding authorized accelerated share repurchases ( 1,000 ) — — — — ( 1,000 )
Other 55 ( 53 ) — — — 2
Balance at September 30, 2024 $ 5,584 $ ( 42,390 ) $ 57,920 $ ( 1,717 ) $ 6 $ 19,403
Nine Months Ended September 30, 2025
Balance at December 31, 2024 $ 6,941 $ ( 44,331 ) $ 59,352 $ ( 2,471 ) $ 3 $ 19,494
Profit (loss) of consolidated and affiliated companies — — 6,482 — ( 1 ) 6,481
Foreign currency translation, net of tax — — — 593 — 593
Pension and other postretirement benefits, net of tax — — — ( 2 ) — ( 2 )
Derivative financial instruments, net of tax — — — 99 — 99
Available-for-sale securities, net of tax — — — 58 — 58
Dividends declared 1 — — ( 1,374 ) — — ( 1,374 )
Common shares issued from treasury stock for stock-based compensation: 1,077,027 ( 53 ) 13 — — — ( 40 )
Stock-based compensation expense 202 — — — — 202
Common shares repurchased: 11,029,455 2 — ( 3,950 ) — — — ( 3,950 )
Outstanding authorized accelerated share repurchases ( 900 ) — — — — ( 900 )
Other 33 ( 34 ) — — ( 1 ) ( 2 )
Balance at September 30, 2025 $ 6,223 $ ( 48,302 ) $ 64,460 $ ( 1,723 ) $ 1 $ 20,659

1

Dividends per share of common stock of $
2.92
and $
2.71
were declared in the nine months ended September 30, 2025 and 2024, respectively.
2

See Note 12 for additional information.
See accompanying notes to Consolidated Financial Statements.

9
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Caterpillar Inc.
Consolidated Statement of Cash Flow
(Unaudited)
(Dollars in Millions)
Nine Months Ended September 30,
2025 2024
Cash flow from operating activities:
Profit of consolidated and affiliated companies $ 6,481 $ 7,998
Adjustments to reconcile profit to net cash provided by operating activities:
Depreciation and amortization 1,664 1,598
Provision (benefit) for deferred income taxes 300 ( 329 )
(Gain) loss on divestiture — 164
Other 509 221
Changes in assets and liabilities, net of acquisitions and divestitures:
Receivables – trade and other ( 788 ) ( 30 )
Inventories ( 2,015 ) ( 781 )
Accounts payable 1,086 ( 96 )
Accrued expenses 51 9
Accrued wages, salaries and employee benefits ( 296 ) ( 671 )
Customer advances 1,649 476
Other assets – net ( 138 ) 120
Other liabilities – net ( 355 ) ( 37 )
Net cash provided by (used for) operating activities 8,148 8,642
Cash flow from investing activities:
Capital expenditures – excluding equipment leased to others ( 1,923 ) ( 1,285 )
Expenditures for equipment leased to others ( 1,021 ) ( 893 )
Proceeds from disposals of leased assets and property, plant and equipment 544 541
Additions to finance receivables ( 10,964 ) ( 11,457 )
Collections of finance receivables 9,890 10,234
Proceeds from sale of finance receivables 26 69
Investments and acquisitions (net of cash acquired) ( 26 ) ( 32 )
Proceeds from sale of businesses and investments (net of cash sold) 12 ( 67 )
Proceeds from maturities and sale of securities 1,945 2,841
Investments in securities ( 1,291 ) ( 892 )
Other – net ( 19 ) 137
Net cash provided by (used for) investing activities ( 2,827 ) ( 804 )
Cash flow from financing activities:
Dividends paid ( 2,043 ) ( 1,966 )
Common stock issued, and other stock compensation transactions, net ( 39 ) 15
Payments to purchase common stock ( 4,850 ) ( 7,057 )
Excise tax paid on purchases of common stock ( 73 ) —
Proceeds from debt issued (original maturities greater than three months):
- Machinery, Energy & Transportation 1,976 —
- Financial Products 6,478 7,579
Payments on debt (original maturities greater than three months):
- Machinery, Energy & Transportation ( 43 ) ( 1,021 )
- Financial Products ( 6,162 ) ( 5,841 )
Short-term borrowings – net (original maturities three months or less) 106 ( 848 )
Net cash provided by (used for) financing activities ( 4,650 ) ( 9,139 )
Effect of exchange rate changes on cash ( 23 ) ( 39 )
Increase (decrease) in cash, cash equivalents and restricted cash 648 ( 1,340 )
Cash, cash equivalents and restricted cash at beginning of period 6,896 6,985
Cash, cash equivalents and restricted cash at end of period $ 7,544 $ 5,645

Cash equivalents primarily represent short-term, highly liquid investments with original maturities of generally three months or less
.
See accompanying notes to Consolidated Financial Statements.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
 
1.
                                   
A.  Nature of operations
 
Information in our financial statements and related commentary are presented in the following categories:
 
Machinery, Energy & Transportation
(ME&T) — We define ME&T as Caterpillar Inc. and its subsidiaries, excluding Financial Products. ME&T’s information relates to the design, manufacturing and marketing of our products.
 
Financial Products
— We define Financial Products as our finance and insurance subsidiaries, primarily Caterpillar Financial Services Corporation (Cat Financial) and Caterpillar Insurance Holdings Inc. (Insurance Services). Financial Products’ information relates to the financing to customers and dealers for the purchase and lease of Caterpillar and other equipment.
B.  Basis of presentation
 
In the opinion of management, the accompanying unaudited financial statements include all adjustments, consisting only of normal recurring adjustments, necessary for a fair statement of (a) the consolidated results of operations for the three and nine months ended September 30, 2025 and 2024, (b) the consolidated comprehensive income for the three and nine months ended September 30, 2025 and 2024, (c) the consolidated financial position at September 30, 2025 and December 31, 2024, (d) the consolidated changes in shareholders’ equity for the three and nine months ended September 30, 2025 and 2024 and (e) the consolidated cash flow for the nine months ended September 30, 2025 and 2024.  The financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America (U.S. GAAP) and pursuant to the rules and regulations of the Securities and Exchange Commission (SEC).
Interim results are not necessarily indicative of results for a full year. The information included in this Form 10-Q should be read in conjunction with the audited financial statements and notes thereto included in our company’s annual report on Form 10-K for the year ended December 31, 2024 (2024 Form 10-K).
 
The December 31, 2024 financial position data included herein is derived from the audited consolidated financial statements included in the 2024 Form 10-K but does not include all disclosures required by U.S. GAAP. Certain amounts for prior periods have been reclassified to conform to the current period financial statement presentation.
Cat Financial has end-user customers and dealers that are variable interest entities (VIEs) of which we are not the primary beneficiary. Our maximum exposure to loss from our involvement with these VIEs is limited to the credit risk inherently present in the financial support that we have provided. Credit risk was evaluated and reflected in our financial statements as part of our overall portfolio of finance receivables and related allowance for credit losses. See Note 11 for further discussions on a consolidated VIE.

2.
                                   
New accounting guidance
A. Adoption of new accounting standards
We consider the applicability and impact of all ASUs. We determined that the ASUs effective January 1, 2025 were either not applicable or did not have a material impact on our financial statements.
B. Accounting standards issued but not yet adopted
Income tax reporting
(ASU 2023-09) — In December 2023, the Financial Accounting Standards Board (FASB) issued accounting guidance to expand the annual disclosure requirements for income taxes, primarily related to the rate reconciliation and income taxes paid.

The expanded disclosures are effective for our year ending December 31, 2025, and can be applied prospectively or retrospectively. We are in the process of evaluating the effect of this new guidance on the related disclosures.
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Disaggregation of income statement expenses
(ASU 2024-03) — In November 2024, the FASB issued accounting guidance to enhance transparency into the nature and function of income statement expenses. The amendments require that on an annual and interim basis, entities disclose disaggregated operating expense information about specific categories, including purchases of inventory, employee compensation, depreciation and amortization. The expanded annual disclosures are effective for our year ending December 31, 2027, and the expanded interim disclosures are effective in 2028, with early adoption permitted. We are in the process of evaluating the effect of this new guidance on the related disclosures.
Internal-use software costs
(ASU 2025-06) — In September 2025, the FASB issued accounting guidance to modernize the accounting for internal-use software costs. Under this guidance, capitalization for internal-use software costs begins when management has authorized and committed to funding the project and it is probable the project will be completed, and the software will be used to perform the intended function. This guidance is effective January 1, 2028, with early adoption permitted, and can be applied on a prospective basis, a modified basis for in-process projects, or a retrospective basis. We are in the process of evaluating the effect of this new guidance on our financial statements.
All other ASUs issued but not yet adopted were assessed and determined that they either were not applicable or were not expected to have a material impact on our financial statements.
3.
   
                                
Sales and revenue contract information
Trade receivables represent amounts due from dealers and end users for the sale of our products, and include amounts due from wholesale inventory financing provided by Cat Financial for a dealer’s purchase of inventory. We recognize trade receivables from dealers and end users in Receivables – trade and other and Long-term receivables – trade and other in the Consolidated Statement of Financial Position. Trade receivables from dealers and end users were $
8,710
million, $
7,864
million and $
7,923
million as of September 30, 2025, December 31, 2024 and December 31, 2023, respectively. Long-term trade receivables from dealers and end users were $
741
million, $
640
million and $
589
million as of September 30, 2025, December 31, 2024 and December 31, 2023, respectively.
For certain contracts, we invoice for payment when contractual milestones are achieved. We recognize a contract asset when a sale is recognized before achieving the contractual milestones for invoicing. We reduce the contract asset when we invoice for payment and recognize a corresponding trade receivable. Contract assets are included in Prepaid expenses and other current assets in the Consolidated Statement of Financial Position. Contract assets were $
217
 million, $
238
 million and $
246
 million as of September 30, 2025, December 31, 2024 and December 31, 2023, respectively.
We invoice in advance of recognizing the sale of certain products. We recognize advanced customer payments as a contract liability in Customer advances and Other liabilities in the Consolidated Statement of Financial Position. Contract liabilities were $
4,423
million, $
2,745
million and $
2,389
million as of September 30, 2025, December 31, 2024 and December 31, 2023, respectively. We reduce the contract liability when revenue is recognized.
During the three and nine months ended September 30, 2025, we recognized $
351
million and $
1,496
million, respectively, of revenue that was recorded as a contract liability at the beginning of 2025. During the three and nine months ended September 30, 2024, we recognized $
222
 million and $
1,395
 million, respectively, of revenue that was recorded as a contract liability at the beginning of 2024.
We provide discounts to dealers through merchandising programs. We have numerous programs that are designed to promote the sale of our products. The most common dealer programs provide a discount when the dealer sells a product to a targeted end user. We report the estimated cost of these discounts as a reduction to the transaction price when we recognize the product sale. We accrue a corresponding post-sale discount reserve in the Consolidated Statement of Financial Position, which represents discounts we expect to pay on units sold. If discounts paid differ from those estimated, we report the difference as a change in the transaction price in the subsequent period when the final discount is paid. As a result of differences between actual and estimated payments and changes in estimates, we recognized a decrease in revenue of $
61
 million and $
515
 million during the three and nine months ended September 30, 2025, respectively, related to prior period sales. The change in revenue during the three and nine months ended September 30, 2024 related to prior periods sales was inconsequential. Generally, we estimate the cost of these discounts for each product by model by geographic region based on historical experience and changes in merchandising programs known as of the period end financial reporting date. Products sold to dealers in a prior period
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that remained in dealer inventory during 2025 were subject to merchandising program actions taken in 2025 which resulted in higher discounts paid in the current year.
As of September 30, 2025, we have entered into contracts with dealers and end users for which sales have not been recognized as we have not satisfied our performance obligations and transferred control of the products. The dollar amount of unsatisfied performance obligations for contracts with an original duration greater than one year is $
22.5
billion, with about one-half of the amount expected to be completed and revenue recognized in the
twelve months
following September 30, 2025. We have elected the practical expedient not to disclose unsatisfied performance obligations with an original contract duration of one year or less. Contracts with an original duration of one year or less are primarily sales to dealers for machinery, engines and replacement parts.
See Note 16 for further disaggregated sales and revenues information.
4.
                                    
Stock-based compensation
 
Accounting for stock-based compensation requires that the cost resulting from all stock-based payments be recognized in the financial statements based on the grant date fair value of the award.  Our stock-based compensation consists of stock options, restricted stock units (RSUs) and performance-based restricted stock units (PRSUs).
We recognized pretax stock-based compensation expense of $
71
million and $
202
million for the three and nine months ended September 30, 2025, respectively, and $
52
million and $
171
million for the three and nine months ended September 30, 2024, respectively.
The following table illustrates the type and fair value of the stock-based compensation awards granted during the nine months ended September 30, 2025 and 2024, respectively:
Nine Months Ended September 30, 2025 Nine Months Ended September 30, 2024
Shares Granted Weighted-Average Fair Value Per Share Shares Granted Weighted-Average Fair Value Per Share
Stock options 299,523 $ 106.04 296,295 $ 104.27
RSUs 477,750 $ 338.61 379,621 $ 338.65
PRSUs 201,934 $ 345.60 169,120 $ 408.64

 
The fair value of our stock options was estimated using the Black-Scholes option-pricing model.
The following table provides the assumptions used in determining the fair value of the stock-options granted in the nine months ended September 30, 2025 and 2024, respectively:
 
Grant Year
2025 2024
Weighted-average dividend yield 2.13 % 2.40 %
Weighted-average volatility 30.5 % 30.7 %
Range of volatilities 26.6 % - 32.6 % 26.3 % - 32.3 %
Range of risk-free interest rates 4.13 % - 4.40 % 4.28 % - 5.03 %
Weighted-average expected lives 7 years 7 years

 
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The PRSUs granted in 2025 and 2024 contain a market condition and a Monte Carlo simulation was utilized to estimate the fair value of the awards.
The following table provides the assumptions used in determining the fair value of the PRSUs granted in the nine months ended September 30, 2025 and 2024, respectively:
Grant Year
2025 2024
Expected volatility of the Company's stock 29.5 % 29.8 %
Risk-free interest rate 3.90 % 4.38 %

As of September 30, 2025, the total remaining unrecognized compensation expense related to nonvested stock-based compensation awards was $
229
million, which will be amortized over the weighted-average remaining requisite service periods of approximately
2.0
years.

 
5.
   
                                
 
Derivative financial instruments and risk management
 
Our earnings and cash flow are subject to fluctuations due to changes in foreign currency exchange rates, interest rates, commodity prices, and certain deferred compensation plan liabilities.  Our Risk Management Policy (policy) allows for the use of derivative financial instruments to prudently manage foreign currency exchange rate, interest rate, commodity price and certain deferred compensation plan liability exposures.  Our policy specifies that derivatives are not to be used for speculative purposes.  Derivatives that we use are primarily foreign currency forward, option and cross currency contracts, interest rate contracts, commodity forward and option contracts and total return swap contracts.  Our derivative activities are subject to the management, direction and control of our senior financial officers.  We present at least annually to the Audit Committee of the Board of Directors on our risk management practices, including our use of financial derivative instruments.
 
We recognize all derivatives at their fair value on the Consolidated Statement of Financial Position. On the date the derivative contract is entered into, we designate the derivative as (1) a hedge of the fair value of a recognized asset or liability (fair value hedge), (2) a hedge of a forecasted transaction or the variability of cash flow (cash flow hedge) or (3) an undesignated instrument. We record in current earnings changes in the fair value of a derivative that is qualified, designated and highly effective as a fair value hedge, along with the gain or loss on the hedged recognized asset or liability that is attributable to the hedged risk. For foreign exchange contracts designated as fair value hedges, the interim settlements are excluded from the effectiveness assessment and are recognized under a systematic and rational method over the life of the hedging instrument within Interest expense. We record in AOCI changes in the fair value of a derivative that is qualified, designated and highly effective as a cash flow hedge, to the extent effective, on the Consolidated Statement of Financial Position until we reclassify them to earnings in the same period or periods during which the hedged transaction affects earnings.  We report changes in the fair value of undesignated derivative instruments in current earnings. We classify cash flows from designated derivative financial instruments within the same category as the item being hedged on the Consolidated Statement of Cash Flow.  We include cash flows from undesignated derivative financial instruments in the investing category on the Consolidated Statement of Cash Flow.
 
We formally document all relationships between hedging instruments and hedged items, as well as the risk-management objective and strategy for undertaking various hedge transactions.  This process includes linking all derivatives that are designated as fair value hedges to specific assets and liabilities on the Consolidated Statement of Financial Position and linking cash flow hedges to specific forecasted transactions or variability of cash flow.
We also formally assess, both at the hedge’s inception and on an ongoing basis, whether the designated derivatives that are used in hedging transactions are highly effective in offsetting changes in fair values or cash flow of hedged items.  When a derivative is determined not to be highly effective as a hedge or the underlying hedged transaction is no longer probable, we discontinue hedge accounting prospectively, in accordance with the derecognition criteria for hedge accounting.
 
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Foreign currency exchange rate risk
 
Foreign currency exchange rate movements create a degree of risk by affecting the U.S. dollar value of sales made and costs incurred in foreign currencies. Movements in foreign currency rates also affect our competitive position as these changes may affect business practices and/or pricing strategies of non-U.S.-based competitors. Additionally, we have balance sheet positions denominated in foreign currencies, thereby creating exposure to movements in exchange rates.
 
Our ME&T operations purchase, manufacture and sell products in many locations around the world. As we have a diversified revenue and cost base, we manage our future foreign currency cash flow exposure on a net basis. We use foreign currency forward and option contracts to manage unmatched foreign currency cash inflow and outflow. Our objective is to minimize the risk of exchange rate movements that would reduce the U.S. dollar value of our foreign currency cash flow. Our policy allows for managing anticipated foreign currency cash flow for up to approximately
five years
. As of September 30, 2025, the maximum term of these outstanding contracts at inception was approximately
60
months.
 
We generally designate as cash flow hedges at inception of the contract any foreign currency forward or option contracts that meet the requirements for hedge accounting and the maturity extends beyond the current quarter-end. We perform designation on a specific exposure basis to support hedge accounting. The remainder of ME&T foreign currency contracts are undesignated.  
 
In managing foreign currency risk for our Financial Products operations, our objective is to minimize earnings volatility resulting from conversion and the remeasurement of net foreign currency balance sheet positions and future transactions denominated in foreign currencies. Our policy allows the use of foreign currency forward, option and cross currency contracts to offset the risk of currency mismatch between our assets and liabilities and exchange rate risk associated with future transactions denominated in foreign currencies. Our foreign currency forward and option contracts are primarily undesignated. We designate fixed-to-fixed cross currency contracts as cash flow hedges to protect against movements in exchange rates on foreign currency fixed-rate assets and liabilities. We designate float-to-float cross currency contracts as fair value hedges to protect against movements in exchange rates on floating-rate assets and liabilities.
 
Interest rate risk
 
Interest rate movements create a degree of risk by affecting the amount of our interest payments and the value of our fixed-rate debt. Our practice is to use interest rate contracts to manage our exposure to interest rate changes.
 
Our ME&T operations generally use fixed-rate debt as a source of funding.  Our objective is to minimize the cost of borrowed funds.  Our policy allows us to enter into fixed-to-floating interest rate contracts and forward rate agreements to meet that objective. We designate fixed-to-floating interest rate contracts as fair value hedges at inception of the contract, and we designate certain forward rate agreements as cash flow hedges at inception of the contract.
Financial Products operations has a match-funding policy that addresses interest rate risk by aligning the interest rate profile (fixed or floating rate and duration) of Cat Financial’s debt portfolio with the interest rate profile of our receivables portfolio within predetermined ranges on an ongoing basis. In connection with that policy, we use interest rate derivative instruments to modify the debt structure to match assets within the receivables portfolio. This matched funding reduces the volatility of margins between interest-bearing assets and interest-bearing liabilities, regardless of which direction interest rates move.
 
Our policy allows us to use fixed-to-floating, floating-to-fixed and floating-to-floating interest rate contracts to meet the match-funding objective.  We designate fixed-to-floating interest rate contracts as fair value hedges to protect debt against changes in fair value due to changes in the benchmark interest rate.  We designate most floating-to-fixed interest rate contracts as cash flow hedges to protect against the variability of cash flows due to changes in the benchmark interest rate.
 
We have, at certain times, liquidated fixed-to-floating and floating-to-fixed interest rate contracts at both ME&T and Financial Products. We amortize the gains or losses associated with these contracts at the time of liquidation into earnings over the remaining term of the previously designated hedged item.
 
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Commodity price risk
 
Commodity price movements create a degree of risk by affecting the price we must pay for certain raw materials. Our policy is to use commodity forward and option contracts to manage the commodity risk and reduce the cost of purchased materials.
 
Our ME&T operations purchase base and precious metals embedded in the components we purchase from suppliers.  Our suppliers pass on to us price changes in the commodity portion of the component cost. In addition, we are subject to price changes on energy products such as natural gas and diesel fuel purchased for operational use.
 
Our objective is to minimize volatility in the price of these commodities. Our policy allows us to enter into commodity forward and option contracts to lock in the purchase price of a portion of these commodities within a
five-year
horizon. All such commodity forward and option contracts are undesignated.
Deferred compensation plan liability risk
We are also exposed to variability in compensation expense related to certain non-qualified deferred compensation obligations to employees. We utilize total return swaps to economically hedge this exposure to offset the related compensation expense. All such total return swap contracts are undesignated.
The location and fair value of derivative instruments reported in the Consolidated Statement of Financial Position were as follows:
(Millions of dollars) Fair Value
September 30, 2025 December 31, 2024
Assets 1 Liabilities 2 Assets 1 Liabilities 2
Designated derivatives
Foreign exchange contracts $ 401 $ ( 162 ) $ 357 $ ( 275 )
Interest rate contracts 66 ( 103 ) 10 ( 201 )
Total $ 467 $ ( 265 ) $ 367 $ ( 476 )
Undesignated derivatives
Foreign exchange contracts $ 46 $ ( 47 ) $ 91 $ ( 56 )
Commodity contracts 7 — 4 ( 6 )
Total return swap contracts 29 — — ( 33 )
Total $ 82 $ ( 47 ) $ 95 $ ( 95 )
1 Assets are classified as Receivables - trade and other or Long-term receivables - trade and other.
2 Liabilities are classified as Accrued expenses or Other liabilities.

The total notional amounts of the derivative instruments as of September 30, 2025 and December 31, 2024 were $
28.8
 billion and $
27.0
 billion, respectively. The notional amounts of the derivative financial instruments do not represent amounts exchanged by the parties. We calculate the amounts exchanged by the parties by referencing the notional amounts and by other terms of the derivatives, such as foreign currency exchange rates, interest rates, commodity prices or certain deferred compensation plan liabilities.
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Gains (Losses) on derivative instruments are categorized as follows:
(Millions of dollars) Three Months Ended September 30,
Gains (Losses) Recognized on the Consolidated Statement of Results of Operations 1 Gains (Losses) Recognized in AOCI Gains (Losses) Reclassified from AOCI 2
2025 2024 2025 2024 2025 2024
Cash Flow Hedges
Foreign exchange contracts $ — $ — $ ( 46 ) $ 26 $ ( 17 ) $ ( 70 )
Interest rate contracts — — 2 ( 9 ) 2 9
Fair Value Hedges
Foreign exchange contracts — — ( 3 ) — ( 4 ) —
Interest rate contracts ( 20 ) ( 41 ) — — — —
Undesignated Hedges
Foreign exchange contracts 18 ( 35 ) — — — —
Commodity contracts 11 1 — — — —
Total return swap contracts 53 40 — — — —
Total $ 62 $ ( 35 ) $ ( 47 ) $ 17 $ ( 19 ) $ ( 61 )
1 Foreign exchange contract, Commodity contract and Total return swap contract gains (losses) are included in Other income (expense). Interest rate contract gains (losses) are included in Interest expense of Financial Products and Interest expense excluding Financial Products.
2 Foreign exchange contract gains (losses) are primarily included in Other income (expense). Interest rate contract gains (losses) are primarily included in Interest expense of Financial Products.
(Millions of dollars) Nine Months Ended September 30,
Gains (Losses) Recognized on the Consolidated Statement of Results of Operations 1 Gains (Losses) Recognized in AOCI Gains (Losses) Reclassified from AOCI 2
2025 2024 2025 2024 2025 2024
Cash Flow Hedges
Foreign exchange contracts $ — $ — $ 171 $ 108 $ 55 $ 77
Interest rate contracts — — 15 6 4 38
Fair Value Hedges
Foreign exchange contracts — — ( 5 ) — ( 5 ) —
Interest rate contracts ( 58 ) ( 115 ) — — — —
Undesignated Hedges
Foreign exchange contracts ( 79 ) 58 — — — —
Commodity contracts 16 2 — — — —
Total return swap contracts 83 58 — — — —
Total $ ( 38 ) $ 3 $ 181 $ 114 $ 54 $ 115
1 Foreign exchange contract, Commodity contract and Total return swap contract gains (losses) are included in Other income (expense). Interest rate contract gains (losses) are included in Interest expense of Financial Products and Interest expense excluding Financial Products.
2 Foreign exchange contract gains (losses) are primarily included in Other income (expense). Interest rate contract gains (losses) are primarily included in Interest expense of Financial Products.

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The following amounts were recorded on the Consolidated Statement of Financial Position related to cumulative basis adjustments for fair value hedges:
(Millions of dollars) Carrying Value of the Hedged Liabilities Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Value of the Hedged Liabilities
September 30, 2025 December 31, 2024 September 30, 2025 December 31, 2024
Long-term debt due within one year $ 1,101 $ 483 $ 3 $ ( 16 )
Long-term debt due after one year 5,416 5,327 ( 34 ) ( 170 )
Total $ 6,517 $ 5,810 $ ( 31 ) $ ( 186 )

We enter into International Swaps and Derivatives Association (ISDA) master netting agreements within ME&T and Financial Products that permit the net settlement of amounts owed under their respective derivative contracts. Under these master netting agreements, net settlement generally permits the company or the counterparty to determine the net amount payable for contracts due on the same date and in the same currency for similar types of derivative transactions. The master netting agreements may also provide for net settlement of all outstanding contracts with a counterparty in the case of an event of default or a termination event. Our exposure to credit loss in the event of nonperformance by the counterparties is limited to only those gains that we have recorded, but for which we have not yet received cash payment.
Collateral is typically not required of the counterparties or of our company under the master netting agreements. As of September 30, 2025 and December 31, 2024, no cash collateral was received or pledged under the master netting agreements.
The effect of the net settlement provisions of the master netting agreements on our derivative balances upon an event of default or termination event was as follows:
(Millions of dollars) September 30, 2025 December 31, 2024
Assets Liabilities Assets Liabilities
Gross Amounts Recognized $ 549 $ ( 312 ) $ 462 $ ( 571 )
Financial Instruments Not Offset ( 176 ) 176 ( 186 ) 186
Net Amount $ 373 $ ( 136 ) $ 276 $ ( 385 )

6.
                                     
Inventories
 
Inventories (principally using the last-in, first-out (LIFO) method) were comprised of the following:
 
(Millions of dollars) September 30, 2025 December 31, 2024
Raw materials $ 7,502 $ 6,681
Work-in-process 1,755 1,438
Finished goods 9,325 8,329
Supplies 376 379
Total inventories $ 18,958 $ 16,827

    
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7.
                                     
Intangible assets and goodwill
 
A.  Intangible assets
 
Intangible assets were comprised of the following:
 
September 30, 2025
(Millions of dollars) Gross Carrying Amount 1 Accumulated Amortization 1 Net
Customer relationships $ 2,022 $ ( 1,854 ) $ 168
Intellectual property 482 ( 397 ) 85
Other 117 ( 89 ) 28
Total finite-lived intangible assets $ 2,621 $ ( 2,340 ) $ 281

December 31, 2024
Gross Carrying Amount Accumulated Amortization Net
Customer relationships $ 2,220 $ ( 1,950 ) $ 270
Intellectual property 496 ( 401 ) 95
Other 117 ( 83 ) 34
Total finite-lived intangible assets $ 2,833 $ ( 2,434 ) $ 399
1 For the nine months ended September 30, 2025, $ 235 million of intangible assets were fully amortized and have been removed.

Amortization expense for the three and nine months ended September 30, 2025 was $
41
 million and $
128
 million, respectively. Amortization expense for the three and nine months ended September 30, 2024 was $
44
 million and $
131
 million, respectively.
Amortization expense related to intangible assets is expected to be:
(Millions of dollars)
Remaining Three Months of 2025 2026 2027 2028 2029 Thereafter
$ 40 $ 98 $ 35 $ 27 $ 24 $ 57

 
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B.  Goodwill
 
No
goodwill was impaired during the nine months ended September 30, 2025 or 2024.
The changes in carrying amount of goodwill by reportable segment for the nine months ended September 30, 2025 were as follows: 
(Millions of dollars) December 31, 2024 Other Adjustments 1 September 30, 2025
Construction Industries
Goodwill $ 261 $ 11 $ 272
Impairments ( 22 ) — ( 22 )
Net goodwill 239 11 250
Resource Industries
Goodwill 4,124 35 4,159
Impairments ( 1,175 ) — ( 1,175 )
Net goodwill 2,949 35 2,984
Energy & Transportation
Goodwill 2,939 40 2,979
Impairments ( 925 ) — ( 925 )
Net goodwill 2,014 40 2,054
All Other 2
Goodwill 39 2 41
Consolidated total
Goodwill 7,363 88 7,451
Impairments ( 2,122 ) — ( 2,122 )
Net goodwill $ 5,241 $ 88 $ 5,329

1
Other adjustments are comprised primarily of foreign currency translation.
2

Includes All Other Segment (See Note 16).

8.
                                    
Investments in debt and equity securities
 
We have investments in certain debt and equity securities, which we record at fair value and primarily include in Other assets in the Consolidated Statement of Financial Position. Short-term and long-term investments are held with high quality institutions and, by policy, the amount of credit exposure to any one institution is limited.
We classify debt securities primarily as available-for-sale. We include the unrealized gains and losses arising from the revaluation of available-for-sale debt securities, net of applicable deferred income taxes, in equity (AOCI in the Consolidated Statement of Financial Position). We include the unrealized gains and losses arising from the revaluation of the equity securities in Other income (expense) in the Consolidated Statement of Results of Operations. We generally determine realized gains and losses on sales of investments using the specific identification method for available-for-sale debt and equity securities and include them in Other income (expense) in the Consolidated Statement of Results of Operations.
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Table of Contents
The cost basis and fair value of available-for-sale debt securities with unrealized gains and losses included in equity (AOCI in the Consolidated Statement of Financial Position) were as follows:
Available-for-sale debt securities September 30, 2025 December 31, 2024
(Millions of dollars) Cost Basis Unrealized Pretax Net Gains (Losses) Fair Value Cost Basis Unrealized Pretax Net Gains (Losses) Fair Value
Government debt securities
U.S. treasury bonds $ 10 $ — $ 10 $ 10 $ — $ 10
Other U.S. and non-U.S. government bonds 72 2 74 71 ( 3 ) 68
Corporate debt securities
Corporate bonds and other debt securities 2,475 17 2,492 3,199 ( 29 ) 3,170
Asset-backed securities 265 — 265 220 ( 1 ) 219
Mortgage-backed debt securities
U.S. governmental agency 515 ( 15 ) 500 476 ( 33 ) 443
Residential 5 — 5 2 — 2
Commercial 127 ( 3 ) 124 136 ( 6 ) 130
Total available-for-sale debt securities $ 3,469 $ 1 $ 3,470 $ 4,114 $ ( 72 ) $ 4,042

Available-for-sale debt securities in an unrealized loss position:
September 30, 2025
Less than 12 months 1 12 months or more 1 Total
(Millions of dollars) Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses
Government debt securities
Other U.S. and non-U.S. government bonds $ — $ — $ 26 $ 1 $ 26 $ 1
Corporate debt securities
Corporate bonds 107 — 474 11 581 11
Asset-backed securities 6 — 38 1 44 1
Mortgage-backed debt securities
U.S. governmental agency — — 290 20 290 20
Commercial 3 — 89 3 92 3
Total $ 116 $ — $ 917 $ 36 $ 1,033 $ 36

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Table of Contents
December 31, 2024
Less than 12 months 1 12 months or more 1 Total
(Millions of dollars) Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses
Government debt securities
Other U.S. and non-U.S. government bonds $ — $ — $ 55 $ 4 $ 55 $ 4
Corporate debt securities
Corporate bonds 729 3 812 33 1,541 36
Asset-backed securities 7 — 37 2 44 2
Mortgage-backed debt securities
U.S. governmental agency 126 3 273 30 399 33
Commercial 13 — 113 6 126 6
Total $ 875 $ 6 $ 1,290 $ 75 $ 2,165 $ 81
1 Indicates the length of time that individual securities have been in a continuous unrealized loss position.

The unrealized losses on our investments in government debt securities, corporate debt securities, and mortgage-backed debt securities relate to changes in underlying interest rates and credit spreads since time of purchase. We do not intend to sell the investments, and it is not likely that we will be required to sell the investments before recovery of their respective amortized cost basis. In addition, we did not expect credit-related losses on these investments as of September 30, 2025.
The cost basis and fair value of available-for-sale debt securities at September 30, 2025, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to prepay and creditors may have the right to call obligations.
    
    
September 30, 2025
(Millions of dollars) Cost Basis Fair Value
Due in one year or less $ 826 $ 829
Due after one year through five years 1,530 1,542
Due after five years through ten years 287 292
Due after ten years 179 178
U.S. governmental agency mortgage-backed securities 515 500
Residential mortgage-backed securities 5 5
Commercial mortgage-backed securities 127 124
Total debt securities – available-for-sale $ 3,469 $ 3,470

For the three months ended September 30, 2025 and 2024, proceeds from available-for-sale debt securities were $
323
 million and $
257
 million, respectively. For the nine months ended September 30, 2025 and 2024, proceeds from available-for-sale debt securities were $
1,636
 million and $
917
 million, respectively.
For the three months ended September 30, 2025 and 2024, the net unrealized gains (losses) for equity securities held at September 30, 2025 and 2024 were $
9
 million and $
18
 million, respectively. For the nine months ended September 30, 2025 and 2024, the net unrealized gains (losses) for equity securities held at September 30, 2025 and 2024 were $
36
million and $
32
 million, respectively.

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Table of Contents
9.
                                     
Postretirement benefits
 
A.  Pension and postretirement benefit costs
    
U.S. Pension Benefits Non-U.S. Pension Benefits Other Postretirement Benefits
September 30, September 30, September 30,
(Millions of dollars) 2025 2024 2025 2024 2025 2024
For the three months ended:
Components of net periodic benefit cost:
Service cost $ — $ — $ 12 $ 12 $ 15 $ 16
Interest cost 153 156 28 30 32 33
Expected return on plan assets ( 180 ) ( 174 ) ( 42 ) ( 43 ) ( 3 ) ( 2 )
Amortization of prior service cost (credit) — — — — ( 1 ) ( 3 )
Net periodic benefit cost (benefit) 1 $ ( 27 ) $ ( 18 ) $ ( 2 ) $ ( 1 ) $ 43 $ 44
For the nine months ended:
Components of net periodic benefit cost:
Service cost $ — $ — $ 35 $ 34 $ 47 $ 50
Interest cost 459 469 83 91 93 99
Expected return on plan assets ( 540 ) ( 524 ) ( 122 ) ( 127 ) ( 7 ) ( 6 )
Amortization of prior service cost (credit) — — — — ( 3 ) ( 10 )
Net periodic benefit cost (benefit) 1 $ ( 81 ) $ ( 55 ) $ ( 4 ) $ ( 2 ) $ 130 $ 133

1
The service cost component is included in Operating costs. All other components are included in Other income (expense).

We made $
47
million and $
323
million of contributions to our pension and other postretirement plans during the three and nine months ended September 30, 2025, respectively. We currently anticipate full-year 2025 contributions of approximately $
354
million.
 
B.  Defined contribution benefit costs
 
Total company costs related to our defined contribution plans, which are included in Operating costs in the Consolidated Statement of Results of Operations, were as follows:
 
Three Months Ended September 30, Nine Months Ended September 30,
(Millions of dollars) 2025 2024 2025 2024
U.S. Plans 1 $ 185 $ 168 $ 529 $ 506
Non-U.S. Plans 35 32 103 94
$ 220 $ 200 $ 632 $ 600

1
Includes costs related to our non-qualified deferred compensation plans. We utilize total return swaps to economically hedge this exposure to offset the related costs. See Note 5 for additional information.

 
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Table of Contents
10.
                              
Leases
Revenues from finance and operating leases, primarily included in Revenues of Financial Products on the Consolidated Statement of Results of Operations, were as follows:
Three Months Ended September 30, Nine Months Ended September 30,
(Millions of dollars) 2025 2024 2025 2024
Finance lease revenue $ 121 $ 110 $ 352 $ 325
Operating lease revenue 299 303 907 909
Total $ 420 $ 413 $ 1,259 $ 1,234

We present revenues net of sales and other related taxes.

11.
                              
Guarantees and product warranty
 
We have provided various guarantees that have varying terms and limit potential payment. Under the guarantees, non-performance by the third-parties could require Caterpillar to satisfy the contractual obligation by providing goods, services or financial compensation. The maximum potential amount of future payments (undiscounted and without reduction for any amounts possibly recoverable) that we could be required to make under the guarantees was $
491
million and $
368
 million at September 30, 2025 and December 31, 2024, respectively.
We have dealer performance guarantees and third-party performance guarantees that do not limit potential payment to end users related to indemnities and other commercial contractual obligations. In addition, we have entered into contracts involving industry standard indemnifications that do not limit potential payment. For these unlimited guarantees, we are unable to estimate a maximum potential amount of future payments that could result from claims made.
No significant loss has been experienced or is anticipated under any of these guarantees.  
 
Cat Financial provides guarantees to purchase certain loans of Caterpillar dealers from a special-purpose corporation (SPC) that qualifies as a variable interest entity. Cat Financial receives a fee for providing this guarantee. The purpose of the SPC is to provide short-term working capital loans to Caterpillar dealers.  This SPC issues commercial paper and uses the proceeds to fund its loan program. Cat Financial is the primary beneficiary of the SPC as its guarantees result in Cat Financial having both the power to direct the activities that most significantly impact the SPC’s economic performance and the obligation to absorb losses, and therefore Cat Financial has consolidated the financial statements of the SPC.  As of September 30, 2025 and December 31, 2024, the SPC’s assets of $
1.1
billion and $
1.14
billion, respectively, were primarily comprised of loans to dealers, and the SPC’s liabilities of $
1.1
billion and $
1.14
billion, respectively, were primarily comprised of commercial paper.  The assets of the SPC are not available to pay Cat Financial’s creditors. Cat Financial may be obligated to perform under the guarantee if the SPC experiences losses. No loss has been experienced or is anticipated under this loan purchase agreement.
We determine our product warranty liability by applying historical claim rate experience to the current field population and dealer inventory.  Generally, we base historical claim rates on actual warranty experience for each product by machine model/engine size by customer or dealer location (inside or outside North America).  We develop specific rates for each product shipment month and update them monthly based on actual warranty claim experience.
  
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Table of Contents
The reconciliation of the change in our product warranty liability balances for the nine months ended September 30 was as follows:
Nine Months Ended September 30,
(Millions of dollars) 2025 2024
Warranty liability, beginning of period $ 1,700 $ 1,894
Reduction in liability (payments) ( 613 ) ( 603 )
Increase in liability (new warranties) 564 478
Warranty liability, end of period $ 1,651 $ 1,769

12.
                              

Profit per share
 
Computations of profit per share: Three Months Ended September 30, Nine Months Ended September 30,
(Dollars in millions except per share data) 2025 2024 2025 2024
Profit for the period (A) 1 $ 2,300 $ 2,464 $ 6,482 $ 8,001
Determination of shares (in millions):
Weighted-average number of common shares outstanding (B) 468.6 484.2 471.3 489.0
Shares issuable on exercise of stock awards, net of shares assumed to be purchased out of proceeds at average market price 2.2 2.5 2.1 2.7
Average common shares outstanding for fully diluted computation (C) 2 470.8 486.7 473.4 491.7
Profit per share of common stock:
Basic (A/B) $ 4.91 $ 5.09 $ 13.76 $ 16.36
Diluted (A/C) 2 $ 4.88 $ 5.06 $ 13.69 $ 16.27
Shares outstanding as of September 30, (in millions) 468.0 482.8
1 Profit attributable to common shareholders.
2 Diluted by assumed exercise of stock-based compensation awards using the treasury stock method.

For the three months ended September 30, 2025, there were
no
antidilutive stock options outstanding. For the nine months ended September 30, 2025, we excluded
0.4
million of outstanding stock options from the computation of diluted earnings per share because the effect would have been antidilutive. For both the three and nine months ended September 30, 2024, we excluded
0.3
million and
0.2
million of outstanding stock options, respectively, from the computation of diluted earnings per share because the effect would have been antidilutive.
For the three and nine months ended September 30, 2025, we repurchased
0.8
million and
11.0
million shares of Caterpillar common stock, respectively, at an aggregate cost of $
0.4
billion and $
4.0
billion, respectively. For the three and nine months ended September 30, 2024, we repurchased
2.3
million and
18.2
million shares of Caterpillar common stock, respectively, at an aggregate cost of $
0.8
billion and $
6.1
billion, respectively. We made these purchases through the combination of accelerated share repurchase (ASR) agreements with third-party financial institutions and open market transactions in 2025 and 2024.
In the first quarter of 2025, we entered into ASR agreements to repurchase an aggregate of $
3.0
 billion of common stock. We advanced the $
3.0
 billion and received approximately
5.7
 million shares of Caterpillar common stock, approximately
70
% of the estimated final number of shares to be repurchased, with a value of $
2.1
 billion. The final number of shares to ultimately be repurchased will be based on the average of the daily volume-weighted average prices of our common stock during the term of the ASR agreements, less a discount and subject to adjustments pursuant to the terms and conditions of the ASR agreements. The final settlement of the ASR agreements is scheduled to occur during the fourth quarter of 2025. The remaining $
0.9
 billion was evaluated as unsettled forward contracts and was classified as a reduction to Common stock within the Consolidated Statement of Financial Position.
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13.
                         
Accumulated other comprehensive income (loss)
We present comprehensive income and its components in the Consolidated Statement of Comprehensive Income. Changes in the balances for each component of AOCI were as follows:
Three Months Ended September 30, Nine Months Ended September 30,
(Millions of dollars) 2025 2024 2025 2024
Foreign currency translation
Beginning balance $ ( 1,687 ) $ ( 2,110 ) $ ( 2,310 ) $ ( 1,782 )
Gains (losses) on foreign currency translation ( 29 ) 377 594 36
Less: Tax provision (benefit) 1 ( 20 ) 1 ( 5 )
Net gains (losses) on foreign currency translation ( 30 ) 397 593 41
(Gains) losses reclassified to earnings — — — 28
Less: Tax provision (benefit) — — — —
Net (gains) losses reclassified to earnings — — — 28
Other comprehensive income (loss), net of tax ( 30 ) 397 593 69
Ending balance $ ( 1,717 ) $ ( 1,713 ) $ ( 1,717 ) $ ( 1,713 )
Pension and other postretirement benefits
Beginning balance $ ( 63 ) $ ( 55 ) $ ( 61 ) $ ( 49 )
Current year prior service credit (cost) — — — —
Less: Tax provision (benefit) — — — —
Net current year prior service credit (cost) — — — —
Amortization of prior service (credit) cost ( 1 ) ( 3 ) ( 3 ) ( 10 )
Less: Tax provision (benefit) ( 1 ) — ( 1 ) ( 1 )
Net amortization of prior service (credit) cost — ( 3 ) ( 2 ) ( 9 )
Other comprehensive income (loss), net of tax — ( 3 ) ( 2 ) ( 9 )
Ending balance $ ( 63 ) $ ( 58 ) $ ( 63 ) $ ( 58 )
Derivative financial instruments
Beginning balance $ 74 $ 5 $ ( 46 ) $ 67
Gains (losses) deferred ( 47 ) 17 181 114
Less: Tax provision (benefit) ( 11 ) 10 44 37
Net gains (losses) deferred ( 36 ) 7 137 77
(Gains) losses reclassified to earnings 19 61 ( 54 ) ( 115 )
Less: Tax provision (benefit) 4 10 ( 16 ) ( 34 )
Net (gains) losses reclassified to earnings 15 51 ( 38 ) ( 81 )
Other comprehensive income (loss), net of tax ( 21 ) 58 99 ( 4 )
Ending balance $ 53 $ 63 $ 53 $ 63
Available-for-sale securities
Beginning balance $ ( 8 ) $ ( 70 ) $ ( 54 ) $ ( 56 )
Gains (losses) deferred 15 74 70 56
Less: Tax provision (benefit) 3 13 15 11
Net gains (losses) deferred 12 61 55 45
(Gains) losses reclassified to earnings — — 3 2
Less: Tax provision (benefit) — — — —
Net (gains) losses reclassified to earnings — — 3 2
Other comprehensive income (loss), net of tax 12 61 58 47
Ending balance $ 4 $ ( 9 ) $ 4 $ ( 9 )
Total AOCI ending balance at September 30, $ ( 1,723 ) $ ( 1,717 ) $ ( 1,723 ) $ ( 1,717 )

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14.
                              
Environmental and legal matters
The Company is regulated by federal, state and international environmental laws governing its use, transport and disposal of substances and control of emissions. In addition to governing our manufacturing and other operations, these laws often impact the development of our products, including, but not limited to, required compliance with air emissions standards applicable to internal combustion engines. We have made, and will continue to make, significant research and development and capital expenditures to comply with these emissions standards.
We are engaged in remedial activities at a number of locations, often with other companies, pursuant to federal and state laws. When it is probable we will pay remedial costs at a site, and those costs can be reasonably estimated, we accrue the investigation, remediation, and operating and maintenance costs against our earnings. We accrue costs based on consideration of currently available data and information with respect to each individual site, including available technologies, current applicable laws and regulations, and prior remediation experience. Where no amount within a range of estimates is more likely, we accrue the minimum. Where multiple potentially responsible parties are involved, we consider our proportionate share of the probable costs. In formulating the estimate of probable costs, we do not consider amounts expected to be recovered from insurance companies or others. We reassess these accrued amounts on a quarterly basis. The amount recorded for environmental remediation is not material and is included in Accrued expenses. We believe there is no more than a remote chance that a material amount for remedial activities at any individual site, or at all the sites in the aggregate, will be required.
In addition, we are involved in other unresolved legal actions that arise in the normal course of business. The most prevalent of these unresolved actions involve disputes related to product design, manufacture and performance liability (including claimed asbestos exposure), contracts, employment issues, environmental matters, intellectual property rights, taxes (other than income taxes) and securities laws. The aggregate range of reasonably possible losses in excess of accrued liabilities, if any, associated with these unresolved legal actions is not material. In some cases, we cannot reasonably estimate a range of loss because there is insufficient information regarding the matter. However, we believe there is no more than a remote chance that any liability arising from these matters would be material. Although it is not possible to predict with certainty the outcome of these unresolved legal actions, we believe that these actions will not individually or in the aggregate have a material adverse effect on our consolidated results of operations, financial position or liquidity.
Our operations in Brazil are subject to highly complex labor, tax, customs and other laws. While we believe that we are in compliance with such laws, we are periodically engaged in litigation regarding the application of these laws, including certain tax and customs disputes with federal, state and municipal authorities in Brazil relating to export activities associated with Caterpillar Brasil Ltda. The Company is unable to predict the outcome or reasonably estimate any potential losses; however, we currently believe that any matters raised will not have a material adverse effect on the Company’s consolidated results of operations, financial position or liquidity.
15.
                              
Income taxes
 
The effective tax rate for the three months ended September 30, 2025 was
26.7
percent compared to
20.7
percent for the three months ended September 30, 2024. The effective tax rate for the nine months ended September 30, 2025 was
24.1
percent compared to
21.4
percent for the nine months ended September 30, 2024. The effective tax rate for the three and nine months ended September 30, 2025 was negatively impacted by a change in tax incentives resulting from U.S. tax legislation enacted on July 4, 2025, which reinstated 100 percent bonus depreciation and full expensing of U.S. research and development expenditures. The provision for income taxes for the three and nine months ended September 30, 2025 included a tax charge of $
41
million, compared to tax benefits of $
47
 million in the three and nine months ended September 30, 2024, to reflect changes in estimates related to prior years.
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16.
                              
Segment information
 
A.    Basis for segment information
 
Our Executive Office is comprised of a Chief Executive Officer (CEO),
four
Group Presidents, a Chief Financial Officer (CFO), a Chief Legal Officer and General Counsel and a Chief Human Resources Officer. The Group Presidents and CFO are accountable for a related set of end-to-end businesses that they manage. The Chief Legal Officer and General Counsel leads the Law, Security and Public Policy Division. The Chief Human Resources Officer leads the Human Resources Organization. The CEO allocates resources and manages performance at the Group President/CFO level. As such, the CEO serves as our Chief Operating Decision Maker (CODM), and operating segments are primarily based on the Group President/CFO reporting structure.
 
Three
of our operating segments, Construction Industries, Resource Industries and Energy & Transportation are led by Group Presidents.
One
operating segment, Financial Products, is led by the CFO who also has responsibility for Corporate Services. Corporate Services is a cost center primarily responsible for the performance of certain support functions globally and to provide centralized services; it does not meet the definition of an operating segment.
One
Group President leads
one
smaller operating segment that is included in the All Other Segment. The Law, Security and Public Policy Division and the Human Resources Organization are cost centers and do not meet the definition of an operating segment.
Effective July 1, 2025, we made the following changes to segment reporting. These changes were made to reflect changes in organizational accountabilities and refinements to our internal reporting.
•
Responsibility for business strategy, product design, product management and development, manufacturing, marketing and sales and product support for and sourcing of wear and maintenance components and related parts moved from All Other Segment to Resource Industries.
•
Responsibility for business strategy, product design, product management and development, manufacturing and product support for electronics and control systems moved from Resource Industries to All Other Segment.
•
Responsibility for research and development for automation, electronics and software for machines and engines moved from Resource Industries to the All Other Segment.
Segment information for 2024 has been retrospectively adjusted to conform to the 2025 presentation.
B.    Description of segments
 
We have
five
operating segments, of which
four
are reportable segments. Following is a brief description of our reportable segments and the business activities included in the All Other Segment:
 
Construction Industries
: A segment primarily responsible for supporting customers using machinery in infrastructure and building construction applications. Responsibilities include business strategy, product design, product management and development, manufacturing, marketing and sales and product support. The product portfolio includes asphalt pavers; backhoe loaders; cold planers; compactors; compact track loaders; forestry machines; material handlers; motor graders; pipelayers; road reclaimers; skid steer loaders; telehandlers; track-type loaders; track-type tractors (small, medium); track excavators (mini, small, medium, large); wheel excavators; wheel loaders (compact, small, medium); and related parts and work tools. Inter-segment sales are a source of revenue for this segment.
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Resource Industries
: A segment primarily responsible for supporting customers using machinery in mining, heavy construction and quarry and aggregates. Responsibilities include business strategy, product design, product management and development, manufacturing, marketing and sales and product support. The product portfolio includes large track-type tractors; large mining trucks; hard rock vehicles; electric rope shovels; draglines; hydraulic shovels; rotary drills; large wheel loaders; off-highway trucks; articulated trucks; wheel tractor scrapers; wheel dozers; landfill compactors; soil compactors; wide-body trucks; select work tools; machinery components; wear and maintenance components and related parts. In addition to equipment, Resource Industries also sells technology products and services to provide customers fleet management, equipment management analytics, autonomous machine capabilities, safety services and mining performance solutions. Resource Industries also manages areas that provide services to other parts of the company, including strategic procurement, lean center of excellence, integrated component design and manufacturing and research and development for hydraulic systems and cabs. Inter-segment sales are a source of revenue for this segment.
Energy & Transportation
: A segment primarily responsible for supporting customers using reciprocating engines, turbines, diesel-electric locomotives and related services across industries serving Oil and Gas, Power Generation, Industrial and Transportation applications, including marine- and rail-related businesses as well as product support of on-highway engines. Responsibilities include business strategy, product design, product management, development and testing, manufacturing, marketing and sales and product support. The product and services portfolio includes turbines, centrifugal gas compressors, and turbine-related services; reciprocating engine-powered generator sets; integrated systems and solutions used in the electric power generation industry; reciprocating engines, drivetrain and integrated systems and solutions for the marine and oil and gas industries; reciprocating engines, drivetrain and integrated systems and solutions supplied to the industrial industry as well as Caterpillar machines; electrified powertrain and zero-emission power sources and service solutions development; and diesel-electric and hybrid locomotives and components and other rail-related products and services, including remanufacturing and leasing. Responsibilities also include the remanufacturing of Caterpillar reciprocating engines and components and remanufacturing services for other companies. Inter-segment sales are a source of revenue for this segment.
 
Financial Products Segment
: Provides financing alternatives to customers and dealers around the world for Caterpillar products and services, as well as financing for power generation facilities that, in most cases, incorporate Caterpillar products. Financing plans include operating and finance leases, revolving charge accounts, installment sale contracts, repair/rebuild financing, working capital loans and wholesale financing plans. The segment also provides insurance and risk management products and services that help customers and dealers manage their business risk. Insurance and risk management products offered include physical damage insurance, inventory protection plans, extended service coverage and maintenance plans for machines and engines, and dealer property and casualty insurance. The various forms of financing, insurance and risk management products offered to customers and dealers help support the purchase and lease of Caterpillar equipment. The segment also earns revenues from Machinery, Energy & Transportation, but the related costs are not allocated to operating segments. Financial Products’ segment profit is determined on a pretax basis and includes other income/expense items.
 
All Other Segment
: Primarily includes activities such as: business strategy; product management and development; parts distribution; integrated logistics solutions; electronics and control systems; distribution services responsible for dealer development and administration, including a wholly owned dealer in Japan; dealer portfolio management and ensuring the most efficient and effective distribution of machines, engines and parts; brand management and marketing strategy; research and development for automation, electronics and software for machines and engines and digital investments for new customer and dealer solutions that integrate data analytics with state-of-the-art digital technologies while transforming the buying experience. Results for the All Other Segment are included as a reconciling item between reportable segments and consolidated external reporting.
 
C.    Segment measurement and reconciliations
 
We determine the segment profit of Construction Industries, Resource Industries, Energy & Transportation and our All Other Segment on a pretax basis and exclude most interest expense and certain other income (expense) items. We determine Financial Products Segment profit on a pretax basis and include other income (expense) items.
Our CODM evaluates the operating performance of the segments using segment profit as it provides insight into the financial health of each segment. The CODM reviews this metric regularly to compare the profitability of segments, identify trends, and evaluate which segments require additional resources or strategic adjustments. The CODM uses segment profit to support the allocation of resources predominantly in the annual budget and forecasting process. Additionally, the CODM monitors forecast-to-actual variances, focusing on areas where performance deviates from
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expectations, when evaluating the performance of each segment and making decisions about allocating capital and other resources to each segment.
There are several methodology differences between our segment reporting and our external reporting. The following is a list of the more significant methodology differences:
 
•
For Construction Industries, Resource Industries, Energy & Transportation and our All Other Segment net assets generally include inventories, receivables, property, plant and equipment, goodwill, intangibles, accounts payable and customer advances. We generally manage at the corporate level liabilities other than accounts payable and customer advances, and we do not include these in segment operations. Financial Products Segment assets generally include all categories of assets.
 
•
We value segment inventories and cost of sales using a current cost methodology.
•
We amortize goodwill allocated to segments using a fixed amount based on a
20
-year useful life. This methodology difference only impacts segment assets. We do not include goodwill amortization expense in segment profit. In addition, we have allocated to segments only a portion of goodwill for certain acquisitions made in 2011 or later.
•
We generally manage currency exposures for operating segments, other than Financial Products, at the corporate level and do not include in segment profit or segment assets the effects of changes in exchange rates on results of operations and financial position within the year. We report the net difference created in the translation of revenues and costs between exchange rates used for U.S. GAAP reporting and exchange rates used for segment reporting as a methodology difference.
•
We do not include stock-based compensation expense in segment profit.
•
Postretirement benefit expenses are split; segments are generally responsible for service costs, with the remaining elements of net periodic benefit cost included as a methodology difference.
Reconciling items are created based on accounting differences between segment reporting and our consolidated external reporting. Please refer to pages
33
-
35
for financial information regarding significant reconciling items. Most of our reconciling items are self-explanatory given the above explanations. For the reconciliation of profit, we have grouped the reconciling items as follows:
•
Corporate costs:
These costs are related to corporate requirements primarily for compliance and legal functions for the benefit of the entire organization.
•
Restructuring income/costs:
May include costs for employee separation, long-lived asset impairments, contract terminations and (gains)/losses on divestitures. These costs are included in Other operating (income) expenses except for defined-benefit plan curtailment losses and special termination benefits, which are included in Other income (expense). Restructuring costs also include other exit-related costs, which may consist of accelerated depreciation, inventory write-downs, building demolition, equipment relocation and project management costs and LIFO inventory decrement benefits from inventory liquidations at closed facilities, all of which are primarily included in Cost of goods sold. See Note 20 for more information.
•
Methodology differences: 
See previous discussion of significant accounting differences between segment reporting and consolidated external reporting.
•
Timing:
Timing differences in the recognition of costs between segment reporting and consolidated external reporting. For example, we report certain costs on the cash basis for segment reporting and the accrual basis for consolidated external reporting.

30
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The three and nine months ended September 30, 2025 and 2024, sales and revenues by geographic region reconciled to consolidated sales and revenues were as follows:
Sales and Revenues by Geographic Region
(Millions of dollars) North America Latin America EAME Asia/ Pacific External Sales and Revenues Intersegment Sales and Revenues Total Sales and Revenues
Three Months Ended September 30, 2025
Construction Industries $ 3,912 $ 654 $ 1,217 $ 904 $ 6,687 $ 73 $ 6,760
Resource Industries 1,152 543 541 799 3,035 75 3,110
Energy & Transportation 4,045 559 1,367 1,088 7,059 1,338 8,397
Financial Products Segment 722 118 130 106 1,076 1 — 1,076
Total sales and revenues from reportable segments 9,831 1,874 3,255 2,897 17,857 1,486 19,343
All Other Segment 5 — 2 3 10 63 73
Corporate Items and Eliminations ( 155 ) ( 24 ) ( 26 ) ( 24 ) ( 229 ) ( 1,549 ) ( 1,778 )
Total Sales and Revenues $ 9,681 $ 1,850 $ 3,231 $ 2,876 $ 17,638 $ — $ 17,638
Three Months Ended September 30, 2024
Construction Industries $ 3,629 $ 658 $ 1,150 $ 875 $ 6,312 $ 33 $ 6,345
Resource Industries 1,141 499 444 870 2,954 94 3,048
Energy & Transportation 3,214 449 1,486 856 6,005 1,182 7,187
Financial Products Segment 695 97 130 112 1,034 1 — 1,034
Total sales and revenues from reportable segments 8,679 1,703 3,210 2,713 16,305 1,309 17,614
All Other Segment 1 ( 1 ) 1 7 8 64 72
Corporate Items and Eliminations ( 135 ) ( 24 ) ( 12 ) ( 36 ) ( 207 ) ( 1,373 ) ( 1,580 )
Total Sales and Revenues $ 8,545 $ 1,678 $ 3,199 $ 2,684 $ 16,106 $ — $ 16,106

1    
Includes revenues from Construction Industries, Resource Industries, Energy & Transportation and All Other Segment of $
187
 million and $
190
 million in the three months ended September 30, 2025 and 2024, respectively.

Sales and Revenues by Geographic Region
(Millions of dollars) North America Latin America EAME Asia/ Pacific External Sales and Revenues Intersegment Sales and Revenues Total Sales and Revenues
Nine Months Ended September 30, 2025
Construction Industries $ 10,185 $ 1,698 $ 3,269 $ 2,802 $ 17,954 $ 180 $ 18,134
Resource Industries 3,363 1,645 1,451 2,442 8,901 220 9,121
Energy & Transportation 10,963 1,422 3,883 2,749 19,017 3,784 22,801
Financial Products Segment 2,107 322 378 318 3,125 1 — 3,125
Total sales and revenues from reportable segments 26,618 5,087 8,981 8,311 48,997 4,184 53,181
All Other Segment 19 — 4 11 34 194 228
Corporate Items and Eliminations ( 367 ) ( 66 ) ( 68 ) ( 74 ) ( 575 ) ( 4,378 ) ( 4,953 )
Total Sales and Revenues $ 26,270 $ 5,021 $ 8,917 $ 8,248 $ 48,456 $ — $ 48,456
Nine Months Ended September 30, 2024
Construction Industries $ 11,419 $ 1,930 $ 3,193 $ 2,843 $ 19,385 $ 67 $ 19,452
Resource Industries 3,630 1,499 1,354 2,732 9,215 276 9,491
Energy & Transportation 9,473 1,296 4,201 2,602 17,572 3,633 21,205
Financial Products Segment 2,022 299 377 331 3,029 1 — 3,029
Total sales and revenues from reportable segments 26,544 5,024 9,125 8,508 49,201 3,976 53,177
All Other Segment 13 ( 2 ) 6 11 28 218 246
Corporate Items and Eliminations ( 396 ) ( 66 ) ( 83 ) ( 90 ) ( 635 ) ( 4,194 ) ( 4,829 )
Total Sales and Revenues $ 26,161 $ 4,956 $ 9,048 $ 8,429 $ 48,594 $ — $ 48,594

1    
Includes revenues from Construction Industries, Resource Industries, Energy & Transportation and All Other Segment of $
522
 million and $
547
 million in the nine months ended September 30, 2025 and 2024, respectively.

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Table of Contents
For the three and nine months ended September 30, 2025 and 2024, Energy & Transportation external sales by end user application were as follows:
Energy & Transportation External Sales
Three Months Ended September 30, Nine Months Ended September 30,
(Millions of dollars) 2025 2024 2025 2024
Oil and gas $ 1,979 $ 1,656 $ 5,104 $ 5,053
Power generation 2,634 2,011 7,037 5,514
Industrial 1,077 1,028 3,104 3,062
Transportation 1,369 1,310 3,772 3,943
Energy & Transportation External Sales $ 7,059 $ 6,005 $ 19,017 $ 17,572

Profit from Reportable Segments
(Millions of dollars) Construction Industries Resource Industries Energy & Transportation Financial Products Segment Total from Reportable Segments
Three Months Ended September 30, 2025
Sales and revenues $ 6,760 $ 3,110 $ 8,397 $ 1,076 $ 19,343
Less 1 :
Cost of goods sold 4,874 2,244 5,895 — 13,013
SG&A/R&D 2 472 379 807 215 1,873
Other segment items 3 37 ( 12 ) 17 620 662
Segment Profit $ 1,377 $ 499 $ 1,678 $ 241 $ 3,795
Three Months Ended September 30, 2024
Sales and revenues $ 6,345 $ 3,048 $ 7,187 $ 1,034 $ 17,614
Less 1 :
Cost of goods sold 4,349 2,056 4,897 — 11,302
SG&A/R&D 2 483 369 836 193 1,881
Other segment items 3 27 4 21 595 647
Segment Profit $ 1,486 $ 619 $ 1,433 $ 246 $ 3,784
1 The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM. Inter-segment income/expenses are included within the amounts shown.
2 Includes selling, general and administrative (SG&A) and research and development (R&D) expenses. The combined presentation aligns with the segment-level information that is regularly provided to the CODM.
3 Other segment items for each reportable segment primarily includes:
Construction Industries / Resource Industries / Energy & Transportation – other operating (income) expenses, currency impacts defined as a methodology difference between exchange rates used in U.S. GAAP and segment reporting, and equity in (profit) loss of unconsolidated affiliated companies.
Financial Products Segment – interest expense, Cat Financial’s depreciation on equipment leased to others, Insurance Services’ underwriting expenses and investment and interest income, and foreign exchange (gains) losses.

32
Table of Contents
Profit from Reportable Segments
(Millions of dollars) Construction Industries Resource Industries Energy & Transportation Financial Products Segment Total from Reportable Segments
Nine Months Ended September 30, 2025
Sales and revenues $ 18,134 $ 9,121 $ 22,801 $ 3,125 $ 53,181
Less 1 :
Cost of goods sold 13,051 6,430 15,805 — 35,286
SG&A/R&D 2 1,393 1,107 2,404 614 5,518
Other segment items 3 45 ( 44 ) 15 1,807 1,823
Segment Profit $ 3,645 $ 1,628 $ 4,577 $ 704 $ 10,554
Nine Months Ended September 30, 2024
Sales and revenues $ 19,452 $ 9,491 $ 21,205 $ 3,029 $ 53,177
Less 1 :
Cost of goods sold 13,029 6,345 14,464 — 33,838
SG&A/R&D 2 1,406 1,062 2,411 548 5,427
Other segment items 3 26 17 71 1,715 1,829
Segment Profit $ 4,991 $ 2,067 $ 4,259 $ 766 $ 12,083
1 The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM. Inter-segment income/expenses are included within the amounts shown.
2 Includes selling, general and administrative (SG&A) and research and development (R&D) expenses. The combined presentation aligns with the segment-level information that is regularly provided to the CODM.
3 Other segment items for each reportable segment primarily includes:
Construction Industries / Resource Industries / Energy & Transportation – other operating (income) expenses, currency impacts defined as a methodology difference between exchange rates used in U.S. GAAP and segment reporting, and equity in (profit) loss of unconsolidated affiliated companies.
Financial Products Segment – interest expense, Cat Financial’s depreciation on equipment leased to others, Insurance Services’ underwriting expenses and investment and interest income, and foreign exchange (gains) losses.

Reconciliation of Consolidated profit before taxes:
(Millions of dollars) Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 2025 2024
Total profit from reportable segments $ 3,795 $ 3,784 $ 10,554 $ 12,083
Profit (loss) from All Other Segment ( 6 ) ( 13 ) ( 25 ) 32
Cost centers 6 ( 5 ) — 7
Corporate costs ( 308 ) ( 205 ) ( 732 ) ( 682 )
Timing ( 119 ) ( 3 ) ( 202 ) 12
Restructuring income (costs) ( 37 ) ( 70 ) ( 126 ) ( 322 )
Methodology differences:
Inventory/cost of sales 56 13 8 16
Postretirement benefit expense ( 63 ) ( 51 ) ( 116 ) ( 106 )
Stock-based compensation expense ( 66 ) ( 52 ) ( 196 ) ( 171 )
Financing costs ( 54 ) ( 42 ) ( 168 ) ( 111 )
Currency 18 ( 79 ) ( 131 ) 29
Other income/expense methodology differences ( 89 ) ( 166 ) ( 317 ) ( 584 )
Other methodology differences ( 6 ) ( 13 ) ( 34 ) ( 73 )
Total consolidated profit before taxes $ 3,127 $ 3,098 $ 8,515 $ 10,130

33
Table of Contents
Reconciliation of Assets:
(Millions of dollars) September 30, 2025 December 31, 2024
Assets from reportable segments:
Construction Industries $ 5,587 $ 5,546
Resource Industries 6,157 6,082
Energy & Transportation 11,368 11,772
Financial Products Segment 40,026 36,925
Total assets from reportable segments 63,138 60,325
Assets from All Other Segment 1,493 1,403
Items not included in segment assets:
Cash and cash equivalents 6,633 6,165
Deferred income taxes 2,870 3,194
Goodwill and intangible assets 4,676 4,478
Property, plant and equipment – net and other assets 4,431 4,808
Inventory methodology differences ( 3,650 ) ( 3,560 )
Liabilities included in segment assets 14,615 11,973
Other ( 484 ) ( 1,022 )
Total assets $ 93,722 $ 87,764

Reconciliation of Depreciation and amortization:
(Millions of dollars)
Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 2025 2024
Depreciation and amortization from reportable segments:
Construction Industries $ 67 $ 60 $ 196 $ 173
Resource Industries 65 58 188 170
Energy & Transportation 168 146 477 426
Financial Products Segment 178 184 534 554
Total depreciation and amortization from reportable segments 478 448 1,395 1,323
Items not included in segment depreciation and amortization:
All Other Segment 68 71 197 208
Cost centers 26 25 75 72
Other ( 2 ) ( 1 ) ( 3 ) ( 5 )
Total depreciation and amortization $ 570 $ 543 $ 1,664 $ 1,598

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Table of Contents
Reconciliation of Capital expenditures:
(Millions of dollars)
Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 2025 2024
Capital expenditures from reportable segments:
Construction Industries $ 86 $ 66 $ 196 $ 179
Resource Industries 76 54 199 125
Energy & Transportation 454 292 1,165 671
Financial Products Segment 359 264 908 818
Total capital expenditures from reportable segments 975 676 2,468 1,793
Items not included in segment capital expenditures:
All Other Segment 72 73 167 174
Cost centers 38 60 100 114
Timing ( 6 ) ( 71 ) 219 137
Other ( 8 ) ( 15 ) ( 10 ) ( 40 )
Total capital expenditures $ 1,071 $ 723 $ 2,944 $ 2,178

17.
 
                           

Cat Financial financing activities
Allowance for credit losses
Portfolio segments
A portfolio segment is the level at which Cat Financial develops a systematic methodology for determining its allowance for credit losses. Cat Financial's portfolio segments and related methods for estimating expected credit losses are as follows:
Customer
Cat Financial provides loans and finance leases to end-user customers primarily for the purpose of financing new and used Caterpillar machinery, engines and equipment for commercial use. Cat Financial also provides financing for power generation facilities that, in most cases, incorporate Caterpillar products. The average original term of Cat Financial's customer finance receivables portfolio was approximately
51
months with an average remaining term of approximately
27
months as of September 30, 2025.
Cat Financial typically maintains a security interest in financed equipment and generally requires physical damage insurance coverage on the financed equipment, both of which provide Cat Financial with certain rights and protections. If Cat Financial's collection efforts fail to bring a defaulted account current, Cat Financial generally can repossess the financed equipment, after satisfying local legal requirements, and sell it within the Caterpillar dealer network or through third-party auctions.
Cat Financial estimates the allowance for credit losses related to its customer finance receivables based on loss forecast models utilizing probabilities of default and the estimated loss given default based on past loss experience adjusted for current conditions and reasonable and supportable forecasts capturing country and industry-specific economic factors.
During the three and nine months ended September 30, 2025, Cat Financial's forecasts reflect a continuation of global market uncertainty and actions by global central banks aimed at balancing economic growth and managing inflation. Cat Financial believes the economic forecasts employed represent reasonable and supportable forecasts, followed by a reversion to long-term trends.
Dealer
Cat Financial provides financing to Caterpillar dealers in the form of wholesale financing plans and working capital loans. Cat Financial's wholesale financing plans provide financing to dealers for their primarily new Caterpillar equipment inventory and rental fleets on a secured and unsecured basis. In addition, Cat Financial provides a variety of secured and unsecured retail loans to Caterpillar dealers.
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Cat Financial estimates the allowance for credit losses for dealer finance receivables based on historical loss rates with consideration of current economic conditions and reasonable and supportable forecasts.
In general, Cat Financial's Dealer portfolio segment has not historically experienced large increases or decreases in credit losses based on changes in economic conditions due to its close working relationships with the dealers and their financial strength. Therefore, Cat Financial made no adjustments to historical loss rates during the three and nine months ended September 30, 2025.
Classes of finance receivables
Cat Financial further evaluates portfolio segments by the class of finance receivables, which is defined as a level of information (below a portfolio segment) in which the finance receivables have the same initial measurement attribute and a similar method for assessing and monitoring credit risk. Cat Financial's classes, which align with management reporting for credit losses, are as follows:
•
North America
- Finance receivables originated in the United States and Canada.
•
EAME
- Finance receivables originated in Europe, Africa, the Middle East and Eurasia.
•
Asia/Pacific
- Finance receivables originated in Australia, New Zealand, China, Japan, Southeast Asia and India.
•
Latin America
- Finance receivables originated in Mexico and Central and South American countries.
•
Mining
- Finance receivables originated worldwide related to large mining customers.
•
Power
- Finance receivables originated worldwide related to large power customers of Caterpillar electrical power generation, gas compression and co-generation systems and non-Caterpillar equipment that is powered by these systems.
Receivable balances, including accrued interest, are written off against the allowance for credit losses when, in the judgment of management, they are considered uncollectible (generally upon repossession of the collateral). Generally, the amount of the write-off is determined by comparing the fair value of the collateral, less cost to sell, to the amortized cost of the receivable. Subsequent recoveries, if any, are credited to the allowance for credit losses when received.
An analysis of the allowance for credit losses was as follows:
(Millions of dollars) Three Months Ended September 30, 2025 Three Months Ended September 30, 2024
Customer Dealer Total Customer Dealer Total
Beginning balance $ 281 $ 4 $ 285 $ 246 $ 4 $ 250
Write-offs ( 52 ) — ( 52 ) ( 42 ) — ( 42 )
Recoveries 12 — 12 15 — 15
Provision for credit losses 1 32 — 32 25 — 25
Other 1 — 1 2 — 2
Ending balance $ 274 $ 4 $ 278 $ 246 $ 4 $ 250
Nine Months Ended September 30, 2025 Nine Months Ended September 30, 2024
Customer Dealer Total Customer Dealer Total
Beginning balance $ 258 $ 4 $ 262 $ 276 $ 51 $ 327
Write-offs ( 109 ) — ( 109 ) ( 98 ) ( 47 ) ( 145 )
Recoveries 31 — 31 45 — 45
Provision for credit losses 1 86 — 86 49 — 49
Other 8 — 8 ( 26 ) — ( 26 )
Ending balance $ 274 $ 4 $ 278 $ 246 $ 4 $ 250
Finance Receivables $ 23,066 $ 1,467 $ 24,533 $ 21,551 $ 1,716 $ 23,267
1 Excludes provision for credit losses on unfunded commitments and other miscellaneous receivables.

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Gross write-offs by origination year for the Customer portfolio segment were as follows:
(Millions of dollars) Three Months Ended September 30, 2025
2025 2024 2023 2022 2021 Prior Revolving Finance Receivables Total
North America $ 1 $ 5 $ 7 $ 3 $ 2 $ 1 $ 2 $ 21
EAME — — 3 1 — 1 1 6
Asia/Pacific 1 3 1 — — — — 5
Latin America — 2 — 1 1 — — 4
Mining — 5 5 5 — 1 — 16
Total $ 2 $ 15 $ 16 $ 10 $ 3 $ 3 $ 3 $ 52
Three Months Ended September 30, 2024
2024 2023 2022 2021 2020 Prior Revolving Finance Receivables Total
North America $ — $ 5 $ 4 $ 2 $ 1 $ — $ 2 $ 14
EAME — — 1 1 1 — — 3
Asia/Pacific — 2 1 — — 1 — 4
Latin America — 2 2 1 2 — — 7
Mining 8 3 3 — — — — 14
Total $ 8 $ 12 $ 11 $ 4 $ 4 $ 1 $ 2 $ 42
Nine Months Ended September 30, 2025
2025 2024 2023 2022 2021 Prior Revolving Finance Receivables Total
North America $ 1 $ 10 $ 18 $ 9 $ 6 $ 4 $ 6 $ 54
EAME — 2 6 2 1 1 1 13
Asia/Pacific 1 4 3 1 1 — — 10
Latin America — 2 2 4 1 1 — 10
Mining — 8 6 6 — 1 — 21
Power — — — — — 1 — 1
Total $ 2 $ 26 $ 35 $ 22 $ 9 $ 8 $ 7 $ 109
Nine Months Ended September 30, 2024
2024 2023 2022 2021 2020 Prior Revolving Finance Receivables Total
North America $ — $ 13 $ 10 $ 5 $ 2 $ 1 $ 8 $ 39
EAME — 2 3 3 2 — — 10
Asia/Pacific — 4 4 3 1 1 — 13
Latin America — 2 5 4 3 8 — 22
Mining 8 3 3 — — — — 14
Total $ 8 $ 24 $ 25 $ 15 $ 8 $ 10 $ 8 $ 98

For the three months ended September 30, 2025 and 2024, there were
no
gross write-offs in Cat Financial's Dealer portfolio segment. For the nine months ended September 30, 2025, there were
no
gross write-offs in Cat Financial's Dealer portfolio segment. For the nine months ended September 30, 2024, there were $
47
 million of gross write-offs in Cat Financial's Dealer portfolio segment, all of which were in Latin America and originated prior to 2020.
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Credit quality of finance receivables
At origination, Cat Financial evaluates credit risk based on a variety of credit quality factors including prior payment experience, customer financial information, credit ratings, loan-to-value ratios, probabilities of default, industry trends, macroeconomic factors and other internal metrics. On an ongoing basis, Cat Financial monitors credit quality based on past-due status as there is a meaningful correlation between the past-due status of customers and the risk of loss. In determining past-due status, Cat Financial considers the entire finance receivable past due when any installment is over
30
days past due.
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Table of Contents
Customer
The aging category of Cat Financial's amortized cost of finance receivables in the Customer portfolio segment by origination year were as follows:
(Millions of dollars) September 30, 2025
2025 2024 2023 2022 2021 Prior Revolving Finance Receivables Total Finance Receivables
North America
Current $ 4,105 $ 4,058 $ 2,146 $ 931 $ 453 $ 55 $ 471 $ 12,219
31-60 days past due 22 41 33 18 8 1 4 127
61-90 days past due 6 15 11 6 3 1 2 44
91+ days past due 4 25 32 22 10 4 1 98
EAME
Current 1,131 1,044 699 375 161 67 — 3,477
31-60 days past due 8 11 9 6 2 1 — 37
61-90 days past due 2 4 5 2 1 — — 14
91+ days past due 1 10 12 8 4 2 — 37
Asia/Pacific
Current 772 647 350 132 35 3 — 1,939
31-60 days past due 4 4 3 3 1 — — 15
61-90 days past due 1 3 2 1 — — — 7
91+ days past due 1 3 3 3 — — — 10
Latin America
Current 767 594 256 129 24 3 2 1,775
31-60 days past due 4 7 4 2 1 — — 18
61-90 days past due 1 3 1 1 — — — 6
91+ days past due — 10 7 5 3 2 — 27
Mining
Current 553 766 560 321 128 57 15 2,400
31-60 days past due 5 4 8 — — — — 17
61-90 days past due — — — — — — — —
91+ days past due — — — — — 2 — 2
Power
Current 143 244 180 37 31 40 121 796
31-60 days past due — — — — — — — —
61-90 days past due — — — — — — — —
91+ days past due — — — — — 1 — 1
Totals by Aging Category
Current $ 7,471 $ 7,353 $ 4,191 $ 1,925 $ 832 $ 225 $ 609 $ 22,606
31-60 days past due 43 67 57 29 12 2 4 214
61-90 days past due 10 25 19 10 4 1 2 71
91+ days past due 6 48 54 38 17 11 1 175
Total Customer $ 7,530 $ 7,493 $ 4,321 $ 2,002 $ 865 $ 239 $ 616 $ 23,066

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(Millions of dollars) December 31, 2024
2024 2023 2022 2021 2020 Prior Revolving Finance Receivables Total Finance Receivables
North America
Current $ 5,340 $ 3,035 $ 1,567 $ 980 $ 244 $ 23 $ 385 $ 11,574
31-60 days past due 30 42 29 18 5 1 3 128
61-90 days past due 9 14 10 6 2 1 1 43
91+ days past due 13 37 26 16 6 2 1 101
EAME
Current 1,235 874 532 285 92 72 — 3,090
31-60 days past due 7 10 4 3 1 — — 25
61-90 days past due 3 4 1 1 1 — — 10
91+ days past due 3 14 8 6 4 1 — 36
Asia/Pacific
Current 898 531 256 87 14 2 — 1,788
31-60 days past due 4 6 5 2 — — — 17
61-90 days past due 1 1 2 1 — — — 5
91+ days past due 4 1 2 1 1 — — 9
Latin America
Current 800 363 220 60 8 2 — 1,453
31-60 days past due 4 6 5 1 — 2 — 18
61-90 days past due 1 2 1 — — — — 4
91+ days past due 2 6 8 4 1 1 — 22
Mining
Current 924 755 444 206 67 34 21 2,451
31-60 days past due — 1 — — — — — 1
61-90 days past due — 1 — — — — — 1
91+ days past due 4 5 5 1 — 3 — 18
Power
Current 169 184 39 43 64 56 166 721
31-60 days past due — — — — — — — —
61-90 days past due — — — — — — — —
91+ days past due — — — — — 2 — 2
Totals by Aging Category
Current $ 9,366 $ 5,742 $ 3,058 $ 1,661 $ 489 $ 189 $ 572 $ 21,077
31-60 days past due 45 65 43 24 6 3 3 189
61-90 days past due 14 22 14 8 3 1 1 63
91+ days past due 26 63 49 28 12 9 1 188
Total Customer $ 9,451 $ 5,892 $ 3,164 $ 1,721 $ 510 $ 202 $ 577 $ 21,517

Dealer
As of September 30, 2025 and December 31, 2024, Cat Financial's total amortized cost of finance receivables within the Dealer portfolio segment was current.
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Non-accrual finance receivables
Recognition of income is suspended and the finance receivable is placed on non-accrual status when management determines that collection of future income is not probable. Contracts on non-accrual status are generally more than
120
days past due. Recognition is resumed and previously suspended income is recognized when collection is considered probable. Payments received while the finance receivable is on non-accrual status are applied to interest and principal in accordance with the contractual terms. Interest earned but uncollected prior to the receivable being placed on non-accrual status is written off through Provision for credit losses when, in the judgment of management, it is considered uncollectible.
In Cat Financial's Customer portfolio segment, finance receivables which were on non-accrual status and finance receivables over 90 days past due and still accruing income were as follows:
(Millions of dollars) September 30, 2025 December 31, 2024
Amortized Cost Amortized Cost
Non-accrual With an Allowance 91+ Still Accruing Non-accrual With an Allowance 91+ Still Accruing
North America $ 83 $ 16 $ 83 $ 20
EAME 35 3 33 5
Asia/Pacific 8 3 5 5
Latin America 29 — 24 —
Mining 2 — 29 —
Power 1 — 2 —
Total $ 158 $ 22 $ 176 $ 30

There were
no
finance receivables in Cat Financial's Dealer portfolio segment on non-accrual status as of September 30, 2025 and December 31, 2024.
Modifications
Cat Financial periodically modifies the terms of their finance receivable agreements. Typically, the types of modifications granted are payment deferrals, interest-only payment periods and/or term extensions. Many modifications Cat Financial grants are for commercial reasons or for borrowers experiencing some form of short-term financial stress and may result in insignificant payment delays. Cat Financial does not consider these borrowers to be experiencing financial difficulty. Modifications for borrowers Cat Financial does consider to be experiencing financial difficulty typically result in payment deferrals and/or reduced payments for a period of
four months
or longer, term extension of
six months
or longer or a combination of both.
During the three and nine months ended September 30, 2025 and 2024, there were
no
finance receivable modifications granted to borrowers experiencing financial difficulty in Cat Financial's Dealer portfolio segment.
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The ending amortized cost of finance receivables modified with borrowers experiencing financial difficulty in Cat Financial's Customer portfolio segment was as follows:
(Millions of dollars) Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 2025 2024
Amortized cost of finance receivables modified $ 19 $ 6 $ 37 $ 12
Modifications as a percentage of Customer portfolio 0.08 % 0.03 % 0.16 % 0.05 %

The financial effects of term extensions and payment delays for borrowers experiencing financial difficulty were as follows:
(In months) Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 2025 2024
Weighted average extension to term of modified contracts 20 5 17 8
Weighted average payment deferral and/or interest only periods 5 4 6 6

After Cat Financial modifies a finance receivable, they continue to track its performance under its most recent modified terms. Defaults of loans modified in the prior twelve months were not significant during the three and nine months ended September 30, 2025 and 2024.
The effect of most modifications made to finance receivables for borrowers experiencing financial difficulty is already included in the allowance for credit losses based on the methodologies used to estimate the allowance; therefore, a change to the allowance for credit losses is generally not recorded upon modification. On rare occasions when principal forgiveness is provided, the amount forgiven is written off against the allowance for credit losses.
18.
                             
 
Fair value disclosures
 
    A.

Fair value measurements
 
The guidance on fair value measurements defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants.  This guidance also specifies a fair value hierarchy based upon the observability of inputs used in valuation techniques.  Observable inputs (highest level) reflect market data obtained from independent sources, while unobservable inputs (lowest level) reflect internally developed market assumptions.  In accordance with this guidance, fair value measurements are classified under the following hierarchy:
 
•
Level 1
—

Quoted prices for identical instruments in active markets.
•
Level 2
— Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs or significant value-drivers are observable in active markets.
•
Level 3
— Model-derived valuations in which one or more significant inputs or significant value-drivers are unobservable.
When available, we use quoted market prices to determine fair value, and we classify such measurements within Level 1.  In some cases where market prices are not available, we make use of observable market based inputs to calculate fair value, in which case the measurements are classified within Level 2.  If quoted or observable market prices are not available, fair value is based upon valuations in which one or more significant inputs are unobservable, including internally developed models that use, where possible, current market-based parameters such as interest rates, yield curves and currency rates.  These measurements are classified within Level 3.
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Table of Contents
We classify fair value measurements according to the lowest level input or value-driver that is significant to the valuation.  We may therefore classify a measurement within Level 3 even though there may be significant inputs that are readily observable.
Fair value measurement includes the consideration of nonperformance risk.  Nonperformance risk refers to the risk that an obligation (either by a counterparty or Caterpillar) will not be fulfilled.  For financial assets traded in an active market (Level 1 and certain Level 2), the nonperformance risk is included in the market price.  For certain other financial assets and liabilities (certain Level 2 and Level 3), our fair value calculations have been adjusted accordingly.
 
Investments in debt and equity securities
We have investments in certain debt and equity securities that are recorded at fair value.  Fair values for our U.S. treasury bonds and large capitalization value and smaller company growth equity securities are based upon valuations for identical instruments in active markets.  Fair values for other government debt securities, corporate debt securities and mortgage-backed debt securities are based upon models that take into consideration such market-based factors as recent sales, risk-free yield curves and prices of similarly rated bonds.
In addition, Insurance Services has an equity investment in a real estate investment trust (REIT) which is recorded at fair value based on the net asset value (NAV) of the investment and is not classified within the fair value hierarchy.
See Note 8 for additional information on our investments in debt and equity securities.
Derivative financial instruments
The fair value of interest rate contracts is primarily based on a standard industry accepted valuation model that utilizes the appropriate market-based forward swap curves and zero-coupon interest rates to determine discounted cash flows.  The fair value of foreign currency and commodity forward, option and cross currency contracts is based on standard industry accepted valuation models that discount cash flows resulting from the differential between the contract price and the market-based forward rate. The fair value of total return swap contracts is primarily based on valuing the underlying securities or funds using pricing by industry providers and the average Secured Overnight Financing Rate (SOFR) plus a spread.
See Note 5 for additional information.
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Table of Contents
Assets and liabilities measured on a recurring basis at fair value included in our Consolidated Statement of Financial Position as of September 30, 2025 and December 31, 2024 were as follows:

September 30, 2025
(Millions of dollars) Level 1 Level 2 Level 3 Measured at NAV Total Assets / Liabilities, at Fair Value
Assets
Debt securities
Government debt securities
U.S. treasury bonds $ 10 $ — $ — $ — $ 10
Other U.S. and non-U.S. government bonds — 74 — — 74
Corporate debt securities
Corporate bonds and other debt securities — 2,492 — — 2,492
Asset-backed securities — 265 — — 265
Mortgage-backed debt securities
U.S. governmental agency — 500 — — 500
Residential — 5 — — 5
Commercial — 124 — — 124
Total debt securities 10 3,460 — — 3,470
Equity securities
Large capitalization value 276 — — — 276
Smaller company growth 66 — — — 66
REIT — — — 171 171
Total equity securities 342 — — 171 513
Derivative financial instruments - assets
Foreign currency contracts - net — 238 — — 238
Commodity contracts - net — 7 — — 7
Total return swap contracts - net — 29 — — 29
Total assets $ 352 $ 3,734 $ — $ 171 $ 4,257
Liabilities
Derivative financial instruments - liabilities
Interest rate contracts - net $ — $ 37 $ — $ — $ 37
Total liabilities $ — $ 37 $ — $ — $ 37

 
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December 31, 2024
(Millions of dollars) Level 1 Level 2 Level 3 Measured at NAV Total Assets / Liabilities, at Fair Value
Assets
Debt securities
Government debt securities
U.S. treasury bonds $ 10 $ — $ — $ — $ 10
Other U.S. and non-U.S. government bonds — 68 — — 68
Corporate debt securities
Corporate bonds and other debt securities — 3,170 — — 3,170
Asset-backed securities — 219 — — 219
Mortgage-backed debt securities
U.S. governmental agency — 443 — — 443
Residential — 2 — — 2
Commercial — 130 — — 130
Total debt securities 10 4,032 — — 4,042
Equity securities
Large capitalization value 261 — — — 261
Smaller company growth 41 — — — 41
REIT — — — 167 167
Total equity securities 302 — — 167 469
Derivative financial instruments - assets
Foreign currency contracts - net — 117 — — 117
Total assets $ 312 $ 4,149 $ — $ 167 $ 4,628
Liabilities
Derivative financial instruments - liabilities
Interest rate contracts - net $ — $ 191 $ — $ — $ 191
Commodity contracts - net — 2 — — 2
Total return swap contracts - net — 33 — — 33
Total liabilities $ — $ 226 $ — $ — $ 226

In addition to the amounts above, certain Cat Financial loans are subject to measurement at fair value on a nonrecurring basis and are classified as Level 3 measurements. A loan is measured at fair value when management determines that collection of contractual amounts due is not probable and the loan is individually evaluated. Generally, the fair value of these receivables is measured using the fair value of collateral less estimated costs to sell.  Cat Financial had loans carried at fair value of $
59
million as of September 30, 2025 and December 31, 2024.  
 
    B.

Fair values of financial instruments
 
In addition to the methods and assumptions we use to record the fair value of financial instruments as discussed in the Fair value measurements section above, we use the following methods and assumptions to estimate the fair value of our financial instruments:
Cash and cash equivalents
Carrying amount approximates fair value. We classify cash and cash equivalents as Level 1. See Consolidated Statement of Financial Position.
 
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Table of Contents
Restricted cash and short-term investments
Carrying amount approximates fair value.  We include restricted cash and short-term investments in Prepaid expenses and other current assets in the Consolidated Statement of Financial Position. We classify these instruments as Level 1. See Note 8 for additional information.
 
Finance receivables
We estimate fair value by discounting the future cash flows using current rates, representative of receivables with similar remaining maturities.
 
Wholesale inventory receivables
We estimate fair value by discounting the future cash flows using current rates, representative of receivables with similar remaining maturities.
 
Short-term borrowings
Carrying amount approximates fair value. We classify short-term borrowings as Level 1. See Consolidated Statement of Financial Position.
 
Long-term debt
We estimate fair value for fixed and floating rate debt based on quoted market prices.
Our financial instruments not carried at fair value were as follows:
 
September 30, 2025 December 31, 2024
(Millions of dollars) Carrying Amount Fair Value Carrying Amount Fair Value Fair Value Levels Reference
Assets
Finance receivables – net (excluding finance leases 1 ) $ 17,285 $ 17,005 $ 16,180 $ 15,788 3 Note 17
Wholesale inventory receivables – net (excluding finance leases 1 ) 1,753 1,698 1,568 1,527 3
Liabilities
Long-term debt (including amounts due within one year)
Machinery, Energy & Transportation $ 10,701 $ 10,401 $ 8,610 $ 7,980 2
Financial Products 26,324 26,401 25,406 25,304 2

1    
Represents finance leases and failed sale leasebacks of $
7,158
million and $
6,769
million at September 30, 2025 and

December 31, 2024, respectively.

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Table of Contents
19.
                       

 
Other income (expense)
Three Months Ended September 30, Nine Months Ended September 30,
(Millions of dollars) 2025 2024 2025 2024
Investment and interest income $ 100 $ 108 $ 280 $ 362
Foreign exchange gains (losses) 1 ( 18 ) ( 123 ) ( 161 ) ( 64 )
License fee income 33 36 105 107
Net periodic pension and OPEB income (cost), excluding service cost 13 3 37 8
Gains (losses) on securities 20 18 51 30
Miscellaneous income (loss) 60 34 87 ( 56 )
Total $ 208 $ 76 $ 399 $ 387

1

Includes gains (losses) from foreign exchange derivative contracts. See Note 5 for further details.

20.
                            
 
 
Restructuring income/costs
Our accounting for employee separations is dependent upon how the particular program is designed. For voluntary programs, we recognize eligible separation costs at the time of employee acceptance unless the acceptance requires explicit approval by the company. For involuntary programs, we recognize eligible costs when management has approved the program, the affected employees have been properly notified and the costs are estimable.
Restructuring costs for the three and nine months ended September 30, 2025 and 2024 were as follows:
(Millions of dollars) Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 2025 2024
Employee separations 1 $ 32 $ 17 $ 59 $ 49
Divestitures 1 — — — 164
Contract terminations 1 — 6 4 7
Long-lived asset impairments 1 — — 14 7
Other 2 5 47 52 95
Total restructuring (income) costs $ 37 $ 70 $ 129 $ 322
1 Recognized in Other operating (income) expenses.
2 Represents costs related to our restructuring programs, primarily for inventory write-downs, project management, equipment relocation and accelerated depreciation, all of which are primarily included in Cost of goods sold.

The restructuring costs for the nine months ended September 30, 2025 were related to restructuring actions across the company. The restructuring costs for the nine months ended September 30, 2024 were primarily related to the divestitures of certain non-US entities.
In 2025 and 2024, all restructuring costs are excluded from segment profit.
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Table of Contents
21.
                            
 
 
Supplier finance programs
We facilitate voluntary supplier finance programs (the “Programs”) through participating financial institutions. The Programs are available to a wide range of suppliers and allow them the option to manage their cash flow. We are not a party to the agreements between the participating financial institutions and the suppliers in connection with the Programs. The range of payment terms, typically
60
-
90
days, we negotiate with our suppliers is consistent, irrespective of whether a supplier participates in the Programs. The amount of obligations outstanding that are confirmed as valid to the participating financial institutions for suppliers who voluntarily participate in the Programs, included in Accounts payable in the Consolidated Statement of Financial Position, were $
950
 million and $
830
 million at September 30, 2025 and December 31, 2024, respectively.
22.
                            
 
 
Long-term debt
On May 12, 2025, we issued $
1.7
billion of
5.200
% Senior Notes due 2035 and $
300
 million
5.500
% Senior Notes due 2055. Interest on each series of notes will be paid semi-annually on May 15 and November 15 of each year, commencing on November 15, 2025.
23.
                            
 
 
Subsequent event
On October 12, 2025, the Company entered into a definitive agreement to acquire RPMGlobal Holdings Limited, an Australian-based software company. This agreement requires approval by RPMGlobal shareholders and various regulatory authorities and is subject to other customary closing conditions. The transaction is expected to close in the first quarter of 2026.

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Table of Contents
Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) is intended to provide information that will assist the reader in understanding the company’s Consolidated Financial Statements, the changes in certain key items in those financial statements between select periods and the primary factors that accounted for those changes. In addition, we discuss how certain accounting principles, policies and critical estimates affect our Consolidated Financial Statements. Our discussion also contains certain forward-looking statements related to future events and expectations as well as a discussion of the many factors that we believe may have an impact on our business on an ongoing basis. This MD&A should be read in conjunction with our discussion of cautionary statements and significant risks to the company’s business under Part I, Item 1A. Risk Factors of the
2024 Form 10-K
.
Highlights for the third quarter of 2025 include:
•
Total sales and revenues for the third quarter of 2025 were $17.638 billion, an increase of $1.532 billion, or 10 percent, compared with $16.106 billion in the third quarter of 2024. Sales were higher across the three primary segments.
•
Operating profit margin was 17.3 percent for the third quarter of 2025, compared with 19.5 percent for the third quarter of 2024.
Adjusted operating profit margin
was 17.5 percent for the third quarter of 2025, compared with 20.0 percent for the third quarter of 2024.
•
Third-quarter 2025 profit per share was $4.88, and excluding the items in the table below,
adjusted profit per share
was $4.95. Third-quarter 2024 profit per share was $5.06, and excluding the items in the table below, adjusted profit per share was $5.17.
•
Caterpillar ended the third quarter of 2025 with $7.5 billion of enterprise cash.
Highlights for the nine months ended September 30, 2025, include:
•
Total sales and revenues were $48.456 billion for the nine months ended September 30, 2025, a decrease of $138 million, compared with $48.594 billion for the nine months ended September 30, 2024.
•
Operating profit margin was 17.5 percent for the nine months ended September 30, 2025, compared with 20.9 percent for the nine months ended September 30, 2024. Adjusted operating profit margin was 17.8 percent for the nine months ended September 30, 2025, compared with 21.5 percent for the nine months ended September 30, 2024.
•
Profit per share for the nine months ended September 30, 2025, was $13.69, and excluding the items in the table below, adjusted profit per share was $13.91. Profit per share for the nine months ended September 30, 2024, was $16.27, and excluding the items in the table below, adjusted profit per share was $16.75.
•
Enterprise operating cash flow was $8.1 billion for the nine months ended September 30, 2025.
In order for our results to be more meaningful to our readers, we have separately quantified the impact of significant items.
Three Months Ended September 30, 2025 Three Months Ended September 30, 2024 Nine Months Ended September 30, 2025 Nine Months Ended September 30, 2024
(Dollars in millions except per share data) Profit Before Taxes Profit Per Share Profit Before Taxes Profit Per Share Profit Before Taxes Profit Per Share Profit Before Taxes Profit Per Share
Profit $ 3,127 $ 4.88 $ 3,098 $ 5.06 $ 8,515 $ 13.69 $ 10,130 $ 16.27
Other restructuring (income) costs 37 0.07 70 0.11 126 0.22 158 0.26
Restructuring (income) costs - divestitures of certain non-U.S. entities — — — — — — 164 0.22
Adjusted profit $ 3,164 $ 4.95 $ 3,168 $ 5.17 $ 8,641 $ 13.91 $ 10,452 $ 16.75

A detailed reconciliation of GAAP to non-GAAP financial measures is included on pages
68
-
70
.
Overview
Total sales and revenues for the third quarter of 2025 were $17.638 billion, an increase of $1.532 billion, or 10 percent, compared with $16.106 billion in the third quarter of 2024. The increase was primarily due to higher
sales volume
of $1.554 billion. The increase in sales volume was mainly driven by higher sales of equipment to end users.
Third-quarter 2025 profit per share was $4.88, compared with $5.06 profit per share in the third quarter of 2024. In the third quarter of 2025 and 2024, profit per share included restructuring costs. Profit for the third quarter of 2025 was $2.300 billion, a decrease of $164 million, or 7 percent, compared with $2.464 billion for the third quarter of 2024. The decrease was mainly due to unfavorable manufacturing costs, unfavorable price realization and higher selling, general and administrative (SG&A) and
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Table of Contents
research and development (R&D) expenses. This was partially offset by the profit impact of higher sales volume, favorable other operating income/expense and lower restructuring costs.
Trends and Economic Conditions
Outlook for Key End Markets
In
Construction Industries
, we are encouraged by another quarter of growth in sales of equipment to end users and strong order rates across many of our regions. Customers continue to be responsive to the attractive rates through our merchandising programs with Cat Financial. We continue to anticipate growth in Construction Industries’ sales of equipment to end users in 2025 despite softness in the global industry. In North America, overall construction spending remains at healthy levels and infrastructure projects funded by the Infrastructure Investment and Jobs Act (IIJA) continue to be awarded. We continue to expect growth for sales of equipment to end users. Dealer rental revenues are also expected to grow in 2025, and dealer rental fleet loading is expected to increase in the fourth quarter of 2025 as compared to the fourth quarter of 2024. In Asia Pacific, sales of equipment to end users are expected to be about flat in 2025. China has shown positive momentum to start the year, and we expect growth in the above-10-ton excavator industry in 2025, but from a very low level of activity. In Asia Pacific, outside of China, we expect economic conditions to be soft. In
EAME
, we expect growth for the year, driven by healthy construction activity in Africa and the Middle East and improving economic conditions in Europe. With ongoing weaker construction activity in
Latin America
, we now expect to be about flat in 2025.
In
Resource Industries
, we anticipate lower sales of equipment to end users in 2025 as compared to 2024, as customers continue to display capital discipline. However, we see positive momentum with healthy orders for large mining trucks, articulated trucks and large track type tractors. Although most key commodities remain above investment thresholds, declining coal prices have caused an increase in the number of parked trucks. As a result, we continue to expect slightly lower rebuild activity in 2025 as compared to 2024. Overall, customer product utilization remains high, and the age of the fleet remains elevated. We also continue to see growing demand and customer acceptance of our autonomous solutions.
In
Energy & Transportation
, we expect strong growth in sales for Power Generation in 2025 as compared to 2024. Demand remains robust, driven by data center growth related to cloud computing and generative Artificial Intelligence (AI). Orders for prime power applications are healthy. In Oil and Gas, we expect moderate growth in 2025. For reciprocating engines and
services
, we continue to expect softness in well servicing due to ongoing capital discipline, industry consolidation and efficiency improvements in our customers’ operations. We see positive momentum in demand for reciprocating engines used in gas compression applications. For turbines and turbine-related services used in Oil and Gas applications, backlog remains strong, and we see healthy order and inquiry activity. Demand for products in Industrial applications is improving from previous low levels, with order growth being driven by engines sold into electric power applications. Transportation is expected to remain stable.
Full-Year 2025 Company Trends and Expectations
We are optimistic about our sales and revenues momentum supported by healthy demand signals including a robust backlog and growth in sales of equipment to end users.
For 2025, we expect sales and revenues to increase modestly compared to 2024. Services revenues are expected to be about flat for 2025 as compared to 2024.
Tariff and trade negotiations remain fluid. We are continuously evaluating options to further reduce the impact of incremental tariffs, and we fully intend to implement longer-term actions once there is sufficient certainty. We remain confident that we will manage the impact of tariffs over time.
Based on the incremental tariffs announced in 2025 and in place by November 1, 2025, we expect the impact from incremental tariffs for 2025 will be around $1.6 billion to $1.75 billion, net of some mitigating actions and cost controls. This assumes that the net incremental impact of tariffs will be greater in the fourth quarter of 2025 than the third quarter of 2025, primarily due to the timing of tariff rate changes.
In 2025, we continue to expect restructuring costs of approximately $300 million to $350 million and capital expenditures of around $2.5 billion. We anticipate our 2025 estimated annual effective tax rate to be 24.0 percent, excluding discrete items.
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Fourth-Quarter 2025 Company Trends and Expectations
In the fourth quarter of 2025 as compared to the fourth quarter of 2024, we anticipate strong sales and revenues growth, primarily driven by higher sales volume across all three primary segments. We expect machine dealer inventory to decline slightly in the fourth quarter of 2025, compared to a $1.6 billion decrease in the fourth quarter of 2024. We expect
price realization
to be roughly flat in the fourth quarter of 2025 as compared to the fourth quarter of 2024.
In the fourth quarter of 2025 as compared to the fourth quarter of 2024, in Construction Industries, we expect a strong sales increase, primarily driven by higher sales volume. We expect higher sales volume to be mainly driven by the impact from changes in dealer inventories. We also expect higher sales of equipment to end users. We anticipate price realization for the fourth quarter of 2025 to be about neutral as compared to the fourth quarter of 2024. In Resource Industries, we expect stronger sales in the fourth quarter of 2025 as compared to the fourth quarter of 2024, primarily driven by higher sales volume, partially offset by unfavorable price realization. We expect higher sales volume to be mainly driven by the impact from changes in dealer inventories. We expect lower sales of equipment to end users. The unfavorable impact of price realization in the fourth quarter of 2025 as compared to the fourth quarter of 2024 is expected to be slightly less than the impact in the third quarter of 2025 as compared to the third quarter of 2024. In Energy & Transportation, we anticipate strong sales growth in the fourth quarter of 2025 as compared to the fourth quarter of 2024, primarily driven by continued strength in Power Generation. We also expect higher sales in Oil and Gas, driven by turbines and turbine-related services. Price realization should remain favorable as well. The sales growth rate for Energy & Transportation in the fourth quarter of 2025, as compared to the third quarter of 2025, is expected to be slightly lower than the growth rate in the fourth quarter of 2024 as compared to the third quarter of 2024.
In the fourth quarter of 2025 as compared to the fourth quarter of 2024, excluding the net impact from incremental tariffs, we expect the profit impact of higher sales volume will be partially offset by unfavorable manufacturing costs.
In the fourth quarter of 2025, we anticipate a net incremental tariff impact of about $650 million to $800 million.
In the fourth quarter of 2025 as compared to the fourth quarter of 2024, in Construction Industries, excluding the net impact from incremental tariffs, we expect a profit impact of higher sales volume, which we anticipate will include a partial offset from an unfavorable mix of products. We expect about 55 percent of the net incremental tariff impact will be incurred in Construction Industries. In Resource Industries, excluding the net impact from incremental tariffs, we anticipate the profit impact from higher sales volume will be partially offset by unfavorable price realization. We expect about 20 percent of the net incremental tariff impact will be incurred in Resource Industries. In Energy & Transportation, excluding the net impact from incremental tariffs, we anticipate the profit impact from higher sales volume and favorable price realization will be partially offset by unfavorable manufacturing costs. We expect about 25 percent of the fourth quarter net incremental tariff impact will be incurred in Energy & Transportation. We anticipate incremental tariffs to have a minimal impact to
Corporate Items and Eliminations
in the fourth quarter of 2025 as our current assumptions are based on tariffs announced and in place by November 1, 2025.
Global Business Conditions
We continue to monitor a variety of external factors around the world, such as supply chain disruptions, inflationary cost, labor pressures and the impact of trade policies. Areas of particular focus include transportation, certain components and raw materials. We continue to work to minimize supply chain challenges that may impact our ability to meet customer demand. We continue to assess the environment to determine if additional actions need to be taken.
Risk Factors
Risk factors are disclosed within Item 1A. Risk Factors of the 2024 Form 10-K.
Notes:
•
Glossary of terms is included on pages
62
-
64
; first occurrence of terms shown in bold italics.
•
Information on non-GAAP financial measures is included on pages
68
-
70
.
•
Certain amounts may not add due to rounding.
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Table of Contents
Consolidated Results of Operations
 
THREE MONTHS ENDED SEPTEMBER 30, 2025, COMPARED WITH THREE MONTHS ENDED SEPTEMBER 30, 2024
CONSOLIDATED SALES AND REVENUES
The chart above graphically illustrates reasons for the change in consolidated sales and revenues between the third quarter of 2024 (at left) and the third quarter of 2025 (at right). Caterpillar management utilizes these charts internally to visually communicate with the company’s board of directors and employees.
Total sales and revenues for the third quarter of 2025 were $17.638 billion, an increase of $1.532 billion, or 10 percent, compared with $16.106 billion in the third quarter of 2024. The increase was primarily due to higher sales volume of $1.554 billion. The increase in sales volume was mainly driven by higher sales of equipment to end users.
Sales were higher across the three primary segments.
North America sales increased 14 percent primarily due to higher sales volume. The increase in sales volume was mainly driven by higher sales of equipment to end users.
Sales increased 10 percent in Latin America mainly due to higher sales volume. The increase in sales volume was mainly driven by higher sales of equipment to end users.
EAME sales increased 1 percent due to favorable currency impacts primarily related to the euro, partially offset by unfavorable price realization and lower sales volume. Lower sales volume was mainly driven by the impact from changes in dealer inventories. Dealer inventory increased less during the third quarter of 2025 than during the third quarter of 2024.
Asia/Pacific sales increased 7 percent mainly due to higher sales volume. Higher sales volume was mainly driven by the impact from changes in dealer inventories. Dealer inventory decreased less during the third quarter of 2025 than during the third quarter of 2024.
Total dealer inventory increased $600 million during the third quarter of 2025, compared with an increase of $400 million during the third quarter of 2024. Machine dealer inventory increased $300 million during the third quarter of 2025, compared with an increase of $100 million in the third quarter of 2024. Dealers are independent, and the reasons for changes in their inventory levels vary, including their expectations of future demand and product delivery times. Dealers’ demand expectations take into account seasonal changes, macroeconomic conditions, machine rentals and other factors. Delivery times can vary based on availability of product from Caterpillar factories and product distribution centers.
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Sales and Revenues by Segment
(Millions of dollars) Third Quarter 2024 Sales Volume Price Realization Currency Inter-Segment / Other Third Quarter 2025 $ Change % Change
Construction Industries $ 6,345 $ 568 $ (262) $ 69 $ 40 $ 6,760 $ 415 7 %
Resource Industries 3,048 138 (61) 4 (19) 3,110 62 2 %
Energy & Transportation 7,187 870 132 52 156 8,397 1,210 17 %
All Other Segment 72 2 — — (1) 73 1 1 %
Corporate Items and Eliminations (1,421) (24) — 7 (176) (1,614) (193)
Machinery, Energy & Transportation Sales 15,231 1,554 (191) 132 — 16,726 1,495 10 %
Financial Products Segment 1,034 — — — 42 1,076 42 4 %
Corporate Items and Eliminations (159) — — — (5) (164) (5)
Financial Products Revenues 875 — — — 37 912 37 4 %
Consolidated Sales and Revenues $ 16,106 $ 1,554 $ (191) $ 132 $ 37 $ 17,638 $ 1,532 10 %

Sales and Revenues by Geographic Region

North America Latin America EAME Asia/Pacific External Sales and Revenues Inter-Segment Total Sales and Revenues
(Millions of dollars) $ % Chg $ % Chg $ % Chg $ % Chg $ % Chg $ % Chg $ % Chg
Third Quarter 2025
Construction Industries $ 3,912 8 % $ 654 (1 %) $ 1,217 6 % $ 904 3 % $ 6,687 6 % $ 73 121 % $ 6,760 7 %
Resource Industries 1,152 1 % 543 9 % 541 22 % 799 (8 %) 3,035 3 % 75 (20 %) 3,110 2 %
Energy & Transportation 4,045 26 % 559 24 % 1,367 (8 %) 1,088 27 % 7,059 18 % 1,338 13 % 8,397 17 %
All Other Segment 5 400 % — 100 % 2 100 % 3 (57 %) 10 25 % 63 (2 %) 73 1 %
Corporate Items and Eliminations (59) 2 (3) (5) (65) (1,549) (1,614)
Machinery, Energy & Transportation Sales 9,055 14 % 1,758 10 % 3,124 1 % 2,789 7 % 16,726 10 % — — % 16,726 10 %
Financial Products Segment 722 4 % 118 22 % 130 — % 106 (5 %) 1,076 1 4 % — — % 1,076 4 %
Corporate Items and Eliminations (96) (26) (23) (19) (164) — (164)
Financial Products Revenues 626 4 % 92 21 % 107 (2 %) 87 (1 %) 912 4 % — — % 912 4 %
Consolidated Sales and Revenues $ 9,681 13 % $ 1,850 10 % $ 3,231 1 % $ 2,876 7 % $ 17,638 10 % $ — — % $ 17,638 10 %
Third Quarter 2024
Construction Industries $ 3,629 $ 658 $ 1,150 $ 875 $ 6,312 $ 33 $ 6,345
Resource Industries 1,141 499 444 870 2,954 94 3,048
Energy & Transportation 3,214 449 1,486 856 6,005 1,182 7,187
All Other Segment 1 (1) 1 7 8 64 72
Corporate Items and Eliminations (42) (3) 9 (12) (48) (1,373) (1,421)
Machinery, Energy & Transportation Sales 7,943 1,602 3,090 2,596 15,231 — 15,231
Financial Products Segment 695 97 130 112 1,034 1 — 1,034
Corporate Items and Eliminations (93) (21) (21) (24) (159) — (159)
Financial Products Revenues 602 76 109 88 875 — 875
Consolidated Sales and Revenues $ 8,545 $ 1,678 $ 3,199 $ 2,684 $ 16,106 $ — $ 16,106

1
Includes revenues from Machinery, Energy & Transportation o
f $187 m
illion and $190 million in the
third
quarter of
2025
and
2024
, respectively.

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CONSOLIDATED OPERATING PROFIT
The chart above graphically illustrates reasons for the change in consolidated operating profit between the third quarter of 2024 (at left) and the third quarter of 2025 (at right). Caterpillar management utilizes these charts internally to visually communicate with the company’s board of directors and employees. The bar titled Other includes
consolidating adjustments
and
Machinery, Energy & Transportation other operating (income) expenses
.
Operating profit for the third quarter of 2025 was $3.052 billion, a decrease of $95 million, or 3 percent, compared with $3.147 billion in the third quarter of 2024. The decrease was mainly due to unfavorable
manufacturing costs
of $686 million, unfavorable price realization of $191 million and higher SG&A/R&D expenses of $129 million. This was partially offset by the profit impact of higher sales volume of $700 million, favorable other operating income/expense of $180 million and lower restructuring costs of $33 million. Unfavorable manufacturing costs largely reflected the impact of higher tariffs. The increase in SG&A/R&D expenses was primarily driven by higher compensation expenses, including higher short-term incentive compensation expense. Favorable other operating income/expense included proceeds from an insurance claim.
Operating profit margin was 17.3 percent for the third quarter of 2025, compared with 19.5 percent for the third quarter of 2024.
Profit (Loss) by Segment
(Millions of dollars) Third Quarter 2025 Third Quarter 2024 $ Change % Change
Construction Industries $ 1,377 $ 1,486 $ (109) (7 %)
Resource Industries 499 619 (120) (19 %)
Energy & Transportation 1,678 1,433 245 17 %
All Other Segment (6) (13) 7 54 %
Corporate Items and Eliminations (546) (427) (119)
Machinery, Energy & Transportation 3,002 3,098 (96) (3 %)
Financial Products Segment 241 246 (5) (2 %)
Corporate Items and Eliminations (38) (30) (8)
Financial Products 203 216 (13) (6 %)
Consolidating Adjustments (153) (167) 14
Consolidated Operating Profit $ 3,052 $ 3,147 $ (95) (3 %)

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Other
Profit/Loss and Tax Items
•
Interest expense excluding Financial Products in the third quarter of 2025 was $133 million, compared with $125 million in the third quarter of 2024. The increase was due to higher average debt outstanding, partially offset by lower average borrowing rates.
•
Other income (expense) in the third quarter of 2025 was income of $208 million, compared with income of $76 million in the third quarter of 2024. The change was primarily driven by favorable foreign
currency
impacts.
•
The effective tax rate for the third quarter of 2025 was 26.7 percent compared to 20.7 percent for the third quarter of 2024. Excluding the discrete items discussed below, the third-quarter 2025 estimated annual effective tax rate was 24.0 percent compared with 22.5 percent for the third quarter of 2024.
The company recorded a $54 million charge in the third quarter of 2025 for an increase in the estimated annual tax rate through the first six months, primarily due to a change in tax incentives driven by U.S. tax legislation enacted on July 4, 2025, which reinstated 100 percent bonus depreciation and full expensing of U.S. research and development expenditures.
The company also recorded a discrete tax charge of $41 million in the third quarter of 2025, compared to discrete tax benefits of $47 million in the third quarter of 2024, to reflect changes in estimates related to prior years. In addition, a discrete tax benefit of $10 million was recorded in the third quarter of 2025, compared with a $7 million benefit in the third quarter of 2024, for the settlement of stock-based compensation awards with associated tax deductions in excess of cumulative U.S. GAAP compensation expense.
Please see a reconciliation of GAAP to non-GAAP financial measures on pages
68
-
70
.
Construction Industries
Construction Industries’ total sales were $6.760 billion in the third quarter of 2025, an increase of $415 million, or 7 percent, compared with $6.345 billion in the third quarter of 2024. The increase was primarily due to higher sales volume of $568 million and favorable currency impacts of $69 million, primarily related to the euro, partially offset by unfavorable price realization of $262 million. Higher sales volume was primarily driven by higher sales of equipment to end users.
•
In North America, sales increased due to higher sales volume, partially offset by unfavorable price realization. Higher sales volume was mainly driven by higher sales of equipment to end users.
•
Sales decreased in Latin America due to unfavorable price realization, partially offset by higher sales volume and favorable currency impacts primarily related to the Brazilian real. Higher sales volume was mainly driven by higher sales of equipment to end users.
•
In EAME, sales increased mainly due to higher sales volume and favorable currency impacts primarily related to the euro, partially offset by unfavorable price realization. Higher sales volume was primarily driven by higher sales of equipment to end users.
•
Sales increased in Asia/Pacific mainly due to higher sales volume and favorable currency impacts primarily related to the Japanese yen. Higher sales volume was mainly driven by the impact from changes in
dealer inventories
. Dealer inventory increased during the third quarter of 2025, compared with a decrease during the third quarter of 2024.
Construction Industries’ segment profit was $1.377 billion in the third quarter of 2025, a decrease of $109 million, or 7 percent, compared with $1.486 billion in the third quarter of 2024. The decrease was primarily due to unfavorable price realization of $262 million and unfavorable manufacturing costs of $174 million, partially offset by the profit impact of higher sales volume of $313 million. Unfavorable manufacturing costs largely reflected the impact of higher tariffs.
Construction Industries’ segment profit as a percent of total sales was 20.4 percent in the third quarter of 2025, compared with 23.4 percent in the third quarter of 2024.
Resource Industries
Resource Industries’ total sales were $3.110 billion in the third quarter of 2025, an increase of $62 million, or 2 percent, compared with $3.048 billion in the third quarter of 2024. The increase was primarily due to higher sales volume of $138 million, partially offset by unfavorable price realization of $61 million. The increase in sales volume was mainly driven by higher sales of equipment to end users.
Resource Industries’ segment profit was $499 million in the third quarter of 2025, a decrease of $120 million, or 19 percent, compared with $619 million in the third quarter of 2024. The decrease was mainly due to unfavorable manufacturing costs of $92 million and unfavorable price realization of $61 million, partially offset by the profit impact of higher sales volume of $49 million. Unfavorable manufacturing costs largely reflected the impact of higher tariffs.
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Table of Contents
Resource Industries’ segment profit as a percent of total sales was 16.0 percent in the third quarter of 2025, compared with 20.3 percent in the third quarter of 2024.
Energy & Transportation
Sales by Application
(Millions of dollars) Third Quarter 2025 Third Quarter 2024 $ Change % Change
Oil and Gas $ 1,979 $ 1,656 $ 323 20 %
Power Generation 2,634 2,011 623 31 %
Industrial 1,077 1,028 49 5 %
Transportation 1,369 1,310 59 5 %
External Sales 7,059 6,005 1,054 18 %
Inter-segment 1,338 1,182 156 13 %
Total Sales $ 8,397 $ 7,187 $ 1,210 17 %

Energy & Transportation’s total sales were $8.397 billion in the third quarter of 2025, an increase of $1.210 billion, or 17 percent, compared with $7.187 billion in the third quarter of 2024. The increase was primarily due to higher sales volume of $870 million and higher inter-segment sales of $156 million.
•
Oil and Gas – Sales increased for turbines and turbine-related services. Sales also increased in reciprocating engines used in gas compression applications.
•
Power Generation – Sales increased in large reciprocating engines, primarily data center applications.
•
Industrial – Sales increased in EAME, partially offset by decreased sales in Asia/Pacific.
•
Transportation – Sales increased in rail services.
Energy & Transportation’s segment profit was $1.678 billion in the third quarter of 2025, an increase of $245 million, or 17 percent, compared with $1.433 billion in the third quarter of 2024. The increase was primarily due to the profit impact of higher sales volume of $357 million and favorable price realization of $132 million, partially offset by unfavorable manufacturing costs of $287 million. Unfavorable manufacturing costs primarily reflected the impact of higher tariffs.
Energy & Transportation’s segment profit as a percent of total sales was 20.0 percent in the third quarter of 2025, compared with 19.9 percent in the third quarter of 2024.
Financial Products Segment
Financial Products’ segment revenues were $1.076 billion in the third quarter of 2025, an increase of $42 million, or 4 percent, compared with $1.034 billion in the third quarter of 2024. The increase was primarily due to a favorable impact from higher average
earning assets
of $56 million driven by North America, partially offset by an unfavorable impact from lower average financing rates of $15 million across all regions except Latin America.
Financial Products’ segment profit was $241 million in the third quarter of 2025, a decrease of $5 million, or 2 percent, compared with $246 million in the third quarter of 2024. The decrease was mainly due to a higher provision for credit losses at Cat Financial of $15 million, higher SG&A expenses of $7 million and an unfavorable impact from equity securities at Insurance Services of $6 million, partially offset by a favorable impact from higher average earning assets of $23 million.
At the end of the third quarter of 2025, past dues at Cat Financial were 1.47 percent, compared with 1.74 percent at the end of the third quarter of 2024. Write-offs, net of recoveries, were $40 million for the third quarter of 2025, compared with $27 million for the third quarter of 2024. As of September 30, 2025, Cat Financial's allowance for credit losses totaled $283 million, or 0.89 percent of finance receivables, compared with $290 million, or 0.94 percent of finance receivables at June 30, 2025. The allowance for credit losses at year-end 2024 was $267 million, or 0.91 percent of finance receivables.
Corporate Items and Eliminations
Expense for corporate items and eliminations was $584 million in the third quarter of 2025, an increase of $127 million from the third quarter of 2024, primarily driven by higher corporate costs, including higher short-term incentive compensation expense, and increased expenses due to timing differences, partially offset by proceeds from an insurance claim and favorable impacts of segment reporting methodology differences.
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NINE MONTHS ENDED SEPTEMBER 30, 2025, COMPARED WITH NINE MONTHS ENDED SEPTEMBER 30, 2024
CONSOLIDATED SALES AND REVENUES
The chart above graphically illustrates reasons for the change in consolidated sales and revenues between the nine months ended September 30, 2024 (at left) and the nine months ended September 30, 2025 (at right). Caterpillar management utilizes these charts internally to visually communicate with the company’s board of directors and employees.
Total sales and revenues were $48.456 billion for the nine months ended September 30, 2025, a decrease of $138 million, compared with $48.594 billion for the nine months ended September 30, 2024. Unfavorable price realization of $855 million and unfavorable currency impacts of $79 million, primarily related to the Brazilian real, were offset by higher sales volume of $681 million and higher Financial Products' revenues of $115 million. The increase in sales volume was mainly driven by higher sales of equipment to end users.
In the three primary segments, sales were higher in Energy & Transportation and lower in Construction Industries and Resource Industries.
North America sales were about flat. Higher sales volume was offset by unfavorable price realization. The increase in sales volume was mainly driven by higher sales of equipment to end users.
Sales increased 1 percent in Latin America mainly due to higher sales volume and favorable price realization, partially offset by unfavorable currency impacts primarily related to the Brazilian real. The increase in sales volume was mainly driven by higher sales of equipment to end users.
EAME sales decreased 2 percent primarily due to unfavorable price realization, partially offset by favorable currency impacts primarily related to the euro.
Sales decreased 2 percent in Asia/Pacific mainly due to unfavorable price realization and unfavorable currency impacts primarily related to the Australian dollar.
Dealer inventory increased about $900 million during the nine months ended September 30, 2025, compared with an increase of about $1.7 billion during the nine months ended September 30, 2024. Machine dealer inventory was about flat during the nine months ended September 30, 2025, compared with an increase of $900 million during the nine months ended September 30, 2024. Dealers are independent, and the reasons for changes in their inventory levels vary, including their expectations of future demand and product delivery times. Dealers’ demand expectations take into account seasonal changes, macroeconomic conditions, machine rentals and other factors. Delivery times can vary based on availability of product from Caterpillar factories and product distribution centers.
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Table of Contents
Sales and Revenues by Segment
(Millions of dollars) Nine Months Ended September 30, 2024 Sales Volume Price Realization Currency Inter-Segment / Other Nine Months Ended September 30, 2025 $ Change % Change
Construction Industries $ 19,452 $ (335) $ (1,076) $ (20) $ 113 $ 18,134 $ (1,318) (7 %)
Resource Industries 9,491 (56) (205) (53) (56) 9,121 (370) (4 %)
Energy & Transportation 21,205 1,021 426 (2) 151 22,801 1,596 8 %
All Other Segment 246 8 (1) (1) (24) 228 (18) (7 %)
Corporate Items and Eliminations (4,363) 43 1 (3) (184) (4,506) (143)
Machinery, Energy & Transportation Sales 46,031 681 (855) (79) — 45,778 (253) (1 %)
Financial Products Segment 3,029 — — — 96 3,125 96 3 %
Corporate Items and Eliminations (466) — — — 19 (447) 19
Financial Products Revenues 2,563 — — — 115 2,678 115 4 %
Consolidated Sales and Revenues $ 48,594 $ 681 $ (855) $ (79) $ 115 $ 48,456 $ (138) — %

Sales and Revenues by Geographic Region

North America Latin America EAME Asia/Pacific External Sales and Revenues Inter-Segment Total Sales and Revenues
(Millions of dollars) $ % Chg $ % Chg $ % Chg $ % Chg $ % Chg $ % Chg $ % Chg
Nine Months Ended September 30, 2025
Construction Industries $ 10,185 (11 %) $ 1,698 (12 %) $ 3,269 2 % $ 2,802 (1 %) $ 17,954 (7 %) $ 180 169 % $ 18,134 (7 %)
Resource Industries 3,363 (7 %) 1,645 10 % 1,451 7 % 2,442 (11 %) 8,901 (3 %) 220 (20 %) 9,121 (4 %)
Energy & Transportation 10,963 16 % 1,422 10 % 3,883 (8 %) 2,749 6 % 19,017 8 % 3,784 4 % 22,801 8 %
All Other Segment 19 46 % — 100 % 4 (33 %) 11 — % 34 21 % 194 (11 %) 228 (7 %)
Corporate Items and Eliminations (103) (1) (8) (16) (128) (4,378) (4,506)
Machinery, Energy & Transportation Sales 24,427 — % 4,764 1 % 8,599 (2 %) 7,988 (2 %) 45,778 (1 %) — — % 45,778 (1 %)
Financial Products Segment 2,107 4 % 322 8 % 378 — % 318 (4 %) 3,125 1 3 % — — % 3,125 3 %
Corporate Items and Eliminations (264) (65) (60) (58) (447) — (447)
Financial Products Revenues 1,843 6 % 257 8 % 318 — % 260 — % 2,678 4 % — — % 2,678 4 %
Consolidated Sales and Revenues $ 26,270 — % $ 5,021 1 % $ 8,917 (1 %) $ 8,248 (2 %) $ 48,456 — % $ — — % $ 48,456 — %
Nine Months Ended September 30, 2024
Construction Industries $ 11,419 $ 1,930 $ 3,193 $ 2,843 $ 19,385 $ 67 $ 19,452
Resource Industries 3,630 1,499 1,354 2,732 9,215 276 9,491
Energy & Transportation 9,473 1,296 4,201 2,602 17,572 3,633 21,205
All Other Segment 13 (2) 6 11 28 218 246
Corporate Items and Eliminations (120) (6) (23) (20) (169) (4,194) (4,363)
Machinery, Energy & Transportation Sales 24,415 4,717 8,731 8,168 46,031 — 46,031
Financial Products Segment 2,022 299 377 331 3,029 1 — 3,029
Corporate Items and Eliminations (276) (60) (60) (70) (466) — (466)
Financial Products Revenues 1,746 239 317 261 2,563 — 2,563
Consolidated Sales and Revenues $ 26,161 $ 4,956 $ 9,048 $ 8,429 $ 48,594 $ — $ 48,594

1
Includes revenues from Machinery, Energy & Transportation of $522 million and $547 million in the nine months ended September 30, 2025 and 2024, respectively.

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CONSOLIDATED OPERATING PROFIT
The chart above graphically illustrates reasons for the change in consolidated operating profit between the nine months ended September 30, 2024 (at left) and the nine months ended September 30, 2025 (at right). Caterpillar management utilizes these charts internally to visually communicate with the company’s board of directors and employees. The bar titled Other includes consolidating adjustments and Machinery, Energy & Transportation’s other operating (income) expenses.
Operating profit for the nine months ended September 30, 2025, was $8.491 billion, a decrease of $1.657 billion, or 16 percent, compared with $10.148 billion for the nine months ended September 30, 2024. The decrease was primarily due to unfavorable manufacturing costs of $1.118 billion and unfavorable price realization of $855 million. Unfavorable manufacturing costs largely reflected the impact of higher tariffs.
Operating profit margin was 17.5 percent for the nine months ended September 30, 2025, compared with 20.9 percent for the nine months ended September 30, 2024.
Profit (Loss) by Segment
(Millions of dollars) Nine Months Ended September 30, 2025 Nine Months Ended September 30, 2024 $ Change % Change
Construction Industries $ 3,645 $ 4,991 $ (1,346) (27 %)
Resource Industries 1,628 2,067 (439) (21 %)
Energy & Transportation 4,577 4,259 318 7 %
All Other Segment (25) 32 (57) (178 %)
Corporate Items and Eliminations (1,513) (1,186) (327)
Machinery, Energy & Transportation 8,312 10,163 (1,851) (18 %)
Financial Products Segment 704 766 (62) (8 %)
Corporate Items and Eliminations (88) (298) 210
Financial Products 616 468 148 32 %
Consolidating Adjustments (437) (483) 46
Consolidated Operating Profit $ 8,491 $ 10,148 $ (1,657) (16 %)

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Other Profit/Loss and Tax Items
•
Interest expense excluding Financial Products for the nine months ended September 30, 2025, was $375 million, compared with $405 million for the nine months ended September 30, 2024. The decrease was due to lower average borrowing rates and lower average debt outstanding.
•
Other income (expense) for the nine months ended September 30, 2025, was income of $399 million, compared with income of $387 million for the nine months ended September 30, 2024.
•
The effective tax rate for the nine months ended September 30, 2025, was 24.1 percent compared to 21.4 percent for the nine months ended September 30, 2024. Excluding the discrete items discussed below, the estimated annual effective tax rate for the nine months ended September 30, 2025, was 24.0 percent compared with 22.5 percent for the nine months ended September 30, 2024. The increase was primarily due to a change in tax incentives driven by U.S. tax legislation enacted on July 4, 2025, which reinstated 100 percent bonus depreciation and full expensing of U.S. research and development expenditures.
The company also recorded a discrete tax charge of $41 million in the nine months ended September 30, 2025, compared to discrete tax benefits of $47 million in the nine months ended September 30, 2024, to reflect changes in estimates related to prior years. A discrete tax benefit of $28 million was recorded in the nine months ended September 30, 2025, for the settlement of stock-based compensation awards with associated tax deductions in excess of cumulative U.S. GAAP compensation expense, compared with $49 million for the nine months ended September 30, 2024. In addition, the 2024 estimated annual effective tax rate excluded the impact of year-to-date losses of $164 million for the divestitures of certain non-U.S. entities with related tax benefits of $54 million.
Please see a reconciliation of GAAP to non-GAAP financial measures on pages
68
-
70
.
Construction Industries
Construction Industries’ total sales were $18.134 billion for the nine months ended September 30, 2025, a decrease of $1.318 billion, or 7 percent, compared with $19.452 billion for the nine months ended September 30, 2024. The decrease was primarily due to unfavorable price realization.
•
In North America, sales decreased due to unfavorable price realization and lower sales volume. Lower sales volume was mainly driven by the impact from changes in dealer inventories. Dealer inventory decreased during the nine months ended September 30, 2025, compared with an increase during the nine months ended September 30, 2024.
•
Sales decreased in Latin America due to lower sales volume, unfavorable currency impacts primary related to the Brazilian real and unfavorable price realization. Lower sales volume was mainly driven by the impact from changes in dealer inventories. Dealer inventory decreased during the nine months ended September 30, 2025, compared with an increase during the nine months ended September 30, 2024.
•
In EAME, sales increased due to higher sales volume and favorable currency impacts primarily related to the euro, partially offset by unfavorable price realization. Higher sales volume was primarily due to higher sales of equipment to end users.
•
Sales decreased in Asia/Pacific due to unfavorable price realization and unfavorable currency impacts primarily related to the Australian dollar, partially offset by higher sales volume. Higher sales volume was mainly driven by the impact from changes in dealer inventories. Dealer inventory increased during the nine months ended September 30, 2025, compared with a decrease during the nine months ended September 30, 2024.
Construction Industries’ profit was $3.645 billion for the nine months ended September 30, 2025, a decrease of $1.346 billion, or 27 percent, compared with $4.991 billion for the nine months ended September 30, 2024. The decrease was mainly due to unfavorable price realization of $1.076 billion and unfavorable manufacturing costs of $251 million. Unfavorable manufacturing costs largely reflected the impact of higher tariffs.
Construction Industries’ profit as a percent of total sales was 20.1 percent for the nine months ended September 30, 2025, compared with 25.7 percent for the nine months ended September 30, 2024.
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Resource Industries
Resource Industries’ total sales were $9.121 billion for the nine months ended September 30, 2025, a decrease of $370 million, or 4 percent, compared with $9.491 billion for the nine months ended September 30, 2024. The decrease was primarily due to unfavorable price realization of $205 million and lower sales volume of $56 million. The decrease in sales volume was mainly due to lower sales of equipment to end users.
Resource Industries’ profit was $1.628 billion for the nine months ended September 30, 2025, a decrease of $439 million, or 21 percent, compared with $2.067 billion for the nine months ended September 30, 2024. The decrease was mainly due to unfavorable price realization of $205 million, the profit impact of lower sales volume of $100 million, including an unfavorable mix of products, and unfavorable manufacturing costs of $98 million. Unfavorable manufacturing costs largely reflected the impact of higher tariffs.
Resource Industries’ profit as a percent of total sales was 17.8 percent for the nine months ended September 30, 2025, compared with 21.8 percent for the nine months ended September 30, 2024.
Energy & Transportation
Sales by Application
(Millions of dollars) Nine Months Ended September 30, 2025 Nine Months Ended September 30, 2024 $ Change % Change
Oil and Gas $ 5,104 $ 5,053 $ 51 1 %
Power Generation 7,037 5,514 1,523 28 %
Industrial 3,104 3,062 42 1 %
Transportation 3,772 3,943 (171) (4 %)
External Sales 19,017 17,572 1,445 8 %
Inter-Segment 3,784 3,633 151 4 %
Total Sales $ 22,801 $ 21,205 $ 1,596 8 %

Energy & Transportation’s total sales were $22.801 billion for the nine months ended September 30, 2025, an increase of $1.596 billion, or 8 percent, compared with $21.205 billion for the nine months ended September 30, 2024. The increase was primarily due to higher sales volume of $1.021 billion and favorable price realization of $426 million.
•
Oil and Gas – Sales increased in turbines and turbine-related services. The increase was partially offset by lower sales of reciprocating engines, primarily engines used in gas compression applications.
•
Power Generation – Sales increased in large reciprocating engines, primarily data center applications.
•
Industrial – Sales increased in EAME, partially offset by decreased sales in North America and Asia/Pacific.
•
Transportation – Sales decreased in marine.
Energy & Transportation’s profit was $4.577 billion for the nine months ended September 30, 2025, an increase of $318 million, or 7 percent, compared with $4.259 billion for the nine months ended September 30, 2024. The increase was mainly due to favorable price realization of $426 million and the profit impact of higher sales volume of $306 million, partially offset by unfavorable manufacturing costs of $481 million. Unfavorable manufacturing costs largely reflected the impact of higher tariffs.
Energy & Transportation’s profit as a percent of total sales was 20.1 percent for the nine months ended September 30, 2025 and for the nine months ended September 30, 2024.
Financial Products Segment
Financial Products’ segment revenues were $3.125 billion for the nine months ended September 30, 2025, an increase of $96 million, or 3 percent, compared with $3.029 billion for the nine months ended September 30, 2024. The increase was primarily due to a favorable impact from higher average earning assets of $133 million driven by North America, partially offset by an unfavorable impact from lower average financing rates of $50 million mainly in North America.
Financial Products’ segment profit was $704 million for the nine months ended September 30, 2025, a decrease of $62 million, or 8 percent, compared with $766 million for the nine months ended September 30, 2024. The decrease was mainly due to higher provision for credit losses at Cat Financial of $50 million, the absence of an insurance settlement of $33 million in 2024,
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and an unfavorable impact from lower net yield on average earning assets of $21 million, partially offset by a favorable impact from higher average earning assets of $54 million.
Corporate Items and Eliminations
Expense for corporate items and eliminations was $1.601 billion for the nine months ended September 30, 2025, an increase of $117 million from the nine months ended September 30, 2024, mainly driven by increased expenses due to timing differences, higher corporate costs and unfavorable impacts of segment reporting methodology differences, partially offset by favorable
restructuring income/costs
.
RESTRUCTURING COSTS
In 2025, we expect to incur about $300 million to $350 million of restructuring costs. We expect that prior restructuring actions will result in an incremental benefit to operating costs, primarily Cost of goods sold and SG&A expenses, of about $30 million in 2025 compared with 2024.
Additional information related to restructuring costs is included in Note 20 – "Restructuring income/costs" of Part I, Item 1 "Financial Statements."
GLOSSARY OF TERMS
1.
Adjusted Operating Profit Margin
– Operating profit excluding restructuring income/costs as a percentage of sales and revenues.
2.
Adjusted Profit Per Share
– Profit per share excluding restructuring income/costs.
3.
All Other Segment
– Primarily includes activities such as: business strategy; product management and development; parts distribution; integrated logistics solutions; electronics and control systems; distribution services responsible for dealer development and administration, including a wholly owned dealer in Japan; dealer portfolio management and ensuring the most efficient and effective distribution of machines, engines and parts; brand management and marketing strategy; research and development for automation, electronics and software for machines and engines and digital investments for new customer and dealer solutions that integrate data analytics with state-of-the-art digital technologies while transforming the buying experience.
4.
Consolidating Adjustments
– Elimination of transactions between Machinery, Energy & Transportation and Financial Products.
5.
Construction Industries
– A segment primarily responsible for supporting customers using machinery in infrastructure and building construction applications. Responsibilities include business strategy, product design, product management and development, manufacturing, marketing and sales and product support. The product portfolio includes asphalt pavers; backhoe loaders; cold planers; compactors; compact track loaders; forestry machines; material handlers; motor graders; pipelayers; road reclaimers; skid steer loaders; telehandlers; track-type loaders; track-type tractors (small, medium); track excavators (mini, small, medium, large); wheel excavators; wheel loaders (compact, small, medium); and related parts and work tools.
6.
Corporate Items and Eliminations
– Includes corporate-level expenses, timing differences (as some expenses are reported in segment profit on a cash basis), methodology differences between segment and consolidated external reporting, certain restructuring costs and inter-segment eliminations.
7.
Currency
– With respect to sales and revenues, currency represents the translation impact on sales resulting from changes in foreign currency exchange rates versus the U.S. dollar. With respect to operating profit, currency represents the net translation impact on sales and operating costs resulting from changes in foreign currency exchange rates versus the U.S. dollar. Currency only includes the impact on sales and operating profit for the Machinery, Energy & Transportation line of business; currency impacts on Financial Products revenues and operating profit are included in the Financial Products portions of the respective analyses. With respect to other income/expense, currency represents the effects of forward and option contracts entered into by the company to reduce the risk of fluctuations in exchange rates (hedging) and the net effect of changes in foreign currency exchange rates on our foreign currency assets and liabilities for consolidated results (translation).
8.
Dealer Inventories
– Represents dealer machine and engine inventories, excluding aftermarket parts.
9.
EAME
– A geographic region including Europe, Africa, the Middle East and Eurasia.
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10.
Earning Assets
– Assets consisting primarily of total finance receivables net of unearned income, plus equipment on operating leases net of accumulated depreciation at Cat Financial.
11.
Energy & Transportation
– A segment primarily responsible for supporting customers using reciprocating engines, turbines, diesel-electric locomotives and related services across industries serving Oil and Gas, Power Generation, Industrial and Transportation applications, including marine- and rail-related businesses as well as product support of on-highway engines. Responsibilities include business strategy, product design, product management, development and testing, manufacturing, marketing and sales and product support. The product and services portfolio includes turbines, centrifugal gas compressors, and turbine-related services; reciprocating engine-powered generator sets; integrated systems and solutions used in the electric power generation industry; reciprocating engines, drivetrain and integrated systems and solutions for the marine and oil and gas industries; reciprocating engines, drivetrain and integrated systems and solutions supplied to the industrial industry as well as Caterpillar machines; electrified powertrain and zero-emission power sources and service solutions development; and diesel-electric and hybrid locomotives and components and other rail-related products and services, including remanufacturing and leasing. Responsibilities also include the remanufacturing of Caterpillar reciprocating engines and components and remanufacturing services for other companies.
12.
Financial Products
– The company defines Financial Products as our finance and insurance subsidiaries, primarily Caterpillar Financial Services Corporation (Cat Financial) and Caterpillar Insurance Holdings Inc. (Insurance Services). Financial Products’ information relates to the financing to customers and dealers for the purchase and lease of Caterpillar and other equipment.
13.
Financial Products Segment
– Provides financing alternatives to customers and dealers around the world for Caterpillar products and services, as well as financing for power generation facilities that, in most cases, incorporate Caterpillar products. Financing plans include operating and finance leases, revolving charge accounts, installment sale contracts, repair/rebuild financing, working capital loans and wholesale financing plans. The segment also provides insurance and risk management products and services that help customers and dealers manage their business risk. Insurance and risk management products offered include physical damage insurance, inventory protection plans, extended service coverage and maintenance plans for machines and engines, and dealer property and casualty insurance. The various forms of financing, insurance and risk management products offered to customers and dealers help support the purchase and lease of Caterpillar equipment. The segment also earns revenues from Machinery, Energy & Transportation, but the related costs are not allocated to operating segments. Financial Products’ segment profit is determined on a pretax basis and includes other income/expense items.
14.
Latin America
– A geographic region including Central and South American countries and Mexico.
15.
Machinery, Energy & Transportation (ME&T)
– The company defines ME&T as Caterpillar Inc. and its subsidiaries, excluding Financial Products. ME&T’s information relates to the design, manufacturing and marketing of its products.
16.
Machinery, Energy & Transportation Other Operating (Income) Expenses
–
Comprised primarily of gains/losses on disposal of long-lived assets, gains/losses on divestitures and legal settlements and accruals.
17.
Manufacturing Costs
– Manufacturing costs exclude the impacts of currency and represent the volume-adjusted change for variable costs and the absolute dollar change for period manufacturing costs. Variable manufacturing costs are defined as having a direct relationship with the volume of production. This includes material costs, direct labor and other costs that vary directly with production volume, such as freight, power to operate machines and supplies that are consumed in the manufacturing process. Period manufacturing costs support production but are defined as generally not having a direct relationship to short-term changes in volume. Examples include machinery and equipment repair, depreciation on manufacturing assets, facility support, procurement, factory scheduling, manufacturing planning and operations management.
18.
Mark-to-market gains/losses
– Represents the net gain or loss of actual results differing from the company’s assumptions and the effects of changing assumptions for our defined benefit pension and OPEB plans. These gains and losses are immediately recognized through earnings upon the annual remeasurement in the fourth quarter, or on an interim basis as triggering events warrant remeasurement.
19.
Pension and Other Postemployment Benefits (OPEB)
– The company’s defined-benefit pension and postretirement benefit plans.
20.
Price Realization
– The impact of net price changes excluding currency and new product introductions. Price realization includes geographic mix of sales, which is the impact of changes in the relative weighting of sales prices between geographic regions.
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21.
Resource Industries
– A segment primarily responsible for supporting customers using machinery in mining, heavy construction and quarry and aggregates. Responsibilities include business strategy, product design, product management and development, manufacturing, marketing and sales and product support. The product portfolio includes large track-type tractors; large mining trucks; hard rock vehicles; electric rope shovels; draglines; hydraulic shovels; rotary drills; large wheel loaders; off-highway trucks; articulated trucks; wheel tractor scrapers; wheel dozers; landfill compactors; soil compactors; wide-body trucks; select work tools; machinery components; wear and maintenance components and related parts. In addition to equipment, Resource Industries also sells technology products and services to provide customers fleet management, equipment management analytics, autonomous machine capabilities, safety services and mining performance solutions. Resource Industries also manages areas that provide services to other parts of the company, including strategic procurement, lean center of excellence, integrated component design and manufacturing and research and development for hydraulic systems and cabs.
22.
Restructuring income/costs
– May include costs for employee separation, long-lived asset impairments, contract terminations and (gains)/losses on divestitures. These costs are included in Other operating (income) expenses except for defined-benefit plan curtailment losses and special termination benefits, which are included in Other income (expense). Restructuring costs also include other exit-related costs, which may consist of accelerated depreciation, inventory write-downs, building demolition, equipment relocation and project management costs and LIFO inventory decrement benefits from inventory liquidations at closed facilities, all of which are primarily included in Cost of goods sold.
23.
Sales Volume
– With respect to sales and revenues, sales volume represents the impact of changes in the quantities sold for Machinery, Energy & Transportation as well as the incremental sales impact of new product introductions, including emissions-related product updates. With respect to operating profit, sales volume represents the impact of changes in the quantities sold for Machinery, Energy & Transportation combined with product mix as well as the net operating profit impact of new product introductions, including emissions-related product updates. Product mix represents the net operating profit impact of changes in the relative weighting of Machinery, Energy & Transportation sales with respect to total sales. The impact of sales volume on segment profit includes inter-segment sales.
24.
Services
– Machinery, Energy & Transportation services revenues include, but are not limited to, aftermarket parts and other service-related revenues and exclude most Financial Products revenues, discontinued products and captive dealer services.
LIQUIDITY AND CAPITAL RESOURCES
 
Sources of funds
 
We generate significant capital resources from operating activities, which are the primary source of funding for our ME&T operations. Funding for these businesses is also available from commercial paper and long-term debt issuances. Financial Products’ operations are funded primarily from commercial paper, term debt issuances and collections from its existing portfolio. On a consolidated basis, we had positive operating cash flow in the first nine months of 2025 and ended the third quarter with $7.538 billion of cash, an increase of $649 million from year-end 2024. In addition, ME&T invests in available-for-sale debt securities and bank time deposits that are considered highly liquid and are available for current operations. These ME&T securities were $1.223 billion as of September 30, 2025 and are included in Prepaid expenses and other current assets and Other assets in the Consolidated Statement of Financial Position. We intend to maintain a strong cash and liquidity position.
Consolidated operating cash flow for the first nine months of 2025 was $8.148 billion, down $494 million compared to the same period a year ago. The decrease was primarily due to lower profit before taxes adjusted for non-cash items partially offset by lower cash taxes paid and lower working capital requirements, excluding the impact of changes in accrued wages, salaries, and employee benefits. Within working capital, changes in accounts payable and customer advances favorably impacted cash flow, partially offset by changes in inventories and receivables.
Total debt as of September 30, 2025 was $41.534 billion, an increase of $3.125 billion from year-end 2024. Debt related to ME&T increased $2.154 billion in the first nine months of 2025 primarily due to the issuance of new debt in the second quarter of 2025. ME&T issued $1.700 billion of ten-year bonds at 5.2 percent and $300 million of thirty-year bonds at 5.5 percent. The proceeds from the offering will be used for general corporate purposes, which may include the repayment of existing indebtedness. Debt related to Financial Products increased $2.034 billion, of which $1.000 billion is related to intercompany borrowings with ME&T.
As of September 30, 2025, we had three global credit facilities with a syndicate of banks totaling $11.500 billion (Credit Facility) available in the aggregate to both Caterpillar and Cat Financial for general liquidity purposes. Based on management’s
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allocation decision, which can be revised from time to time, the portion of the Credit Facility available to ME&T as of September 30, 2025 was $2.875 billion. Information on our Credit Facility is as follows:
•
In August 2025, we entered into a new 364-day facility of $3.500 billion (of which $875 million is available to ME&T), which expires in August 2026.
•
In August 2025, we amended and extended the three-year facility (as amended and restated, the "three-year facility"). The three-year facility of $3.000 billion (of which $750 million is available to ME&T) expires in August 2028.
•
In August 2025, we amended and extended the five-year facility (as amended and restated, the "five-year facility"). The five-year facility of $5.000 billion (of which $1.250 billion is available to ME&T) expires in August 2030.
At September 30, 2025, Caterpillar’s consolidated net worth was $20.722 billion, which was above the $9.000 billion required under the Credit Facility. The consolidated net worth is defined in the Credit Facility as Caterpillar's consolidated shareholders’ equity including preferred stock but excluding the pension and other postretirement benefits balance within Accumulated other comprehensive income (loss).
At September 30, 2025, Cat Financial’s covenant interest coverage ratio was 1.50 to 1. This was above the 1.15 to 1 minimum ratio calculated as (1) profit excluding income taxes, interest expense and net gain (loss) from interest rate derivatives to (2) interest expense calculated at the end of each fiscal quarter for the prior four consecutive fiscal quarter periods, required by the Credit Facility.
In addition, at September 30, 2025, Cat Financial’s six-month covenant leverage ratio was 7.16 to 1. This was below the maximum ratio of debt to net worth of 10 to 1, calculated (1) on a monthly basis as the average of the leverage ratios determined on the last day of each of the six preceding calendar months and (2) at each December 31, required by the Credit Facility.
In the event Caterpillar or Cat Financial does not meet one or more of their respective financial covenants under the Credit Facility in the future (and are unable to obtain a consent or waiver), the syndicate of banks may terminate the commitments allocated to the party that does not meet its covenants. Additionally, in such event, certain of Cat Financial’s other lenders under other loan agreements where similar financial covenants or cross default provisions are applicable may, at their election, choose to pursue remedies under those loan agreements, including accelerating the repayment of outstanding borrowings. At September 30, 2025, there were no borrowings under the Credit Facility.
The aforementioned financial covenants are being reported as calculated under the Credit Facility and not pursuant to U.S. GAAP. Please refer to the credit agreements governing the Credit Facility filed as an exhibit to our periodic reports for further information related to the calculation thereof. For risks related to our indebtedness and compliance with these covenants, please refer to the risk factor "Restrictive covenants in our debt agreements could limit our financial and operating flexibility" set forth in Part I, Item 1A of our most recent annual report on Form 10-K.
Our total credit commitments and available credit as of September 30, 2025 were:
September 30, 2025
(Millions of dollars) Consolidated Machinery, Energy & Transportation Financial Products
Credit lines available:
Global credit facilities $ 11,500 $ 2,875 $ 8,625
Other external 4,394 894 3,500
Total credit lines available 15,894 3,769 12,125
Less: Commercial paper outstanding (4,341) — (4,341)
Less: Utilized credit (766) — (766)
Available credit $ 10,787 $ 3,769 $ 7,018

The other external consolidated credit lines with banks as of September 30, 2025 totaled $4.394 billion. These committed and uncommitted credit lines, which may be eligible for renewal at various future dates or have no specified expiration date, are used primarily by our subsidiaries for local funding requirements. Caterpillar or Cat Financial may guarantee subsidiary borrowings under these lines.
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We receive debt ratings from the major credit rating agencies. Fitch maintains a "high-A" debt rating, while Moody’s and S&P maintain a “mid-A” debt rating. A downgrade of our credit ratings by any of the major credit rating agencies could result in increased borrowing costs and could make access to certain credit markets more difficult. In the event economic conditions deteriorate such that access to debt markets becomes unavailable, ME&T’s operations would rely on cash flow from operations, use of existing cash balances, borrowings from Cat Financial and access to our committed credit facilities. Our Financial Products’ operations would rely on cash flow from its existing portfolio, existing cash balances, access to our committed credit facilities and other credit line facilities of Cat Financial, and borrowings from Caterpillar. In addition, we maintain a support agreement with Cat Financial, which requires Caterpillar to remain the sole owner of Cat Financial and may, under certain circumstances, require Caterpillar to make payments to Cat Financial should Cat Financial fail to maintain certain financial ratios.
We facilitate voluntary supplier finance programs (the “Programs”) through participating financial institutions. We account for the payments made under the Programs, the same as other accounts payable, as a reduction to our cash flows from operations. We do not believe that changes in the availability of the programs will have a significant impact on our liquidity. Additional information related to the programs is included in Note 21 – "Supplier finance programs" of Part I, Item 1 "Financial Statements."
Machinery, Energy & Transportation
Net cash provided by operating activities was $7.745 billion in the first nine months of 2025, compared with net cash provided of $7.726 billion for the same period in 2024. The increase was primarily due to lower working capital requirements; excluding the impact of changes in accrued wages, salaries, and employee benefits; and lower cash taxes paid. These increases were partially offset by lower profit before taxes, adjusted for non-cash items. Within working capital, changes in customer advances and accounts payable favorably impacted cash flow but were partially offset by changes in inventories and in receivables.
Net cash used by investing activities in the first nine months of 2025 was $2.112 billion, compared with net cash provided of $1.009 billion in the first nine months of 2024. The change was primarily due to lower proceeds from maturities and sale of securities, primarily due to time deposit maturities in 2024; increased activity related to intercompany lending with Financial Products; and an increase in capital expenditures.
Net cash used for financing activities during the first nine months of 2025 was $5.128 billion, compared with net cash used of $10.044 billion in the same period of 2024. The change was primarily due to lower payments to purchase common stock, higher proceeds from debt issued and lower payments on debt in the first nine months of 2025 compared to the same period in 2024.
While our short-term priorities for the use of cash may vary from time to time as business needs and conditions dictate, our long-term cash deployment strategy is focused on the following priorities. Our top priority is to maintain a strong financial position in support of a mid-A rating. Next, we intend to fund operational requirements and commitments. Then, we intend to fund priorities that profitably grow the company and return capital to shareholders through dividend growth and share repurchases. Additional information on cash deployment is as follows:
Strong financial position
–
Our top priority is to maintain a strong financial position in support of a mid-A rating. We track a diverse group of financial metrics that focus on liquidity, leverage, cash flow and margins which align with our cash deployment actions and the various methodologies used by the major credit rating agencies.
Operational excellence and commitments
–
Capital expenditures were $1.944 billion during the first nine months of 2025, compared to $1.284 billion for the same period in 2024. We expect ME&T’s capital expenditures in 2025 to be about $2.5 billion. We made $323 million of contributions to our pension and other postretirement benefit plans during the first nine months of 2025. We currently anticipate full-year 2025 contributions of approximately $354 million. In comparison, we made $221 million of contributions to our pension and other postretirement benefit plans during the first nine months of 2024.
Fund strategic growth initiatives and return capital to shareholders
–
We intend to utilize our liquidity and debt capacity to fund targeted investments that drive long-term profitable growth focused in the areas of expanded offerings, services and sustainability, including acquisitions.
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As part of our capital allocation strategy, ME&T free cash flow is a liquidity measure we use to determine the cash generated and available for financing activities including debt repayments, dividends and share repurchases. We define ME&T free cash flow as cash from ME&T operations less capital expenditures, excluding discretionary pension and other postretirement benefit plan contributions. A goal of our capital allocation strategy is to return substantially all ME&T free cash flow to shareholders over time in the form of dividends and share repurchases, while maintaining our mid-A rating.
Each quarter, our Board of Directors reviews the company’s dividend for the applicable quarter. The Board evaluates the financial condition of the company and considers corporate cash flow, the company’s liquidity needs, the economic outlook, and the health and stability of global credit markets to determine whether to maintain or change the quarterly dividend. In October 2025, the Board of Directors approved maintaining our quarterly dividend representing $1.51 per share, and we continue to expect our strong financial position to support the dividend. Dividends paid totaled $2.043 billion in the first nine months of 2025.
Our share repurchase plans are subject to the company’s cash deployment priorities and are evaluated on an ongoing basis considering the financial condition of the company, corporate cash flow, the company’s liquidity needs, the economic outlook, and the health and stability of global credit markets. The timing and amount of future repurchases may vary depending on market conditions and investing priorities. In May 2022, the Board approved a share repurchase authorization (the 2022 Authorization) of up to $15.0 billion of Caterpillar common stock effective August 1, 2022, with no expiration. In June 2024, the Board approved an additional share repurchase authorization (the 2024 Authorization) of up to $20.0 billion of Caterpillar common stock, effective June 12, 2024, with no expiration. In the first nine months of 2025, we repurchased $4.850 billion of Caterpillar common stock. As of September 30, 2025, the 2022 Authorization was fully utilized and $15.280 billion remained available under the 2024 Authorization. Our basic shares outstanding as of September 30, 2025 were approximately 468 million.
Financial Products
Net cash provided by operating activities was $894 million in the first nine months of 2025, compared with $1.018 billion for the same period in 2024. Net cash used for investing activities was $2.150 billion in the first nine months of 2025, compared with $1.900 billion for the same period in 2024. The change was primarily due to portfolio related activity, partially offset by the 2024 divestiture of a non-U.S. subsidiary. Net cash provided by financing activities was $1.422 billion in the first nine months of 2025, compared with $890 million for the same period in 2024. The change was primarily due to increased intercompany borrowings from ME&T, partially offset by decreased external borrowings.
RECENT ACCOUNTING PRONOUNCEMENTS
For a discussion of recent accounting pronouncements, see Note 2 – “New accounting guidance” of Part I, Item 1 "Financial Statements."
CRITICAL ACCOUNTING ESTIMATES
 
For a discussion of the company’s critical accounting estimates, see Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations in our 2024 Annual Report on Form 10-K. There have been no significant changes to our critical accounting estimates since our 2024 Annual Report on Form 10-K.
OTHER MATTERS
 
Information related to legal proceedings appears in Note 14 – "Environmental and legal matters" of Part I, Item 1 “Financial Statements.”
Retirement Benefits
We recognize
mark-to-market gains and losses
immediately through earnings upon the remeasurement of our pension and OPEB plans. Mark-to-market gains and losses represent the effects of actual results differing from our assumptions and the effects of changing assumptions. We will record the annual mark-to-market adjustment as of the measurement date, December 31, 2025. It is difficult to predict the December 31, 2025 adjustment amount, as it will be dependent primarily on changes in discount rates during 2025, and actual returns on plan assets differing from our expected returns for 2025.
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Order Backlog
At the end of the third quarter of 2025, the dollar amount of backlog believed to be firm was approximately $39.8 billion, about $2.4 billion higher than the second quarter of 2025 due to increases in the Energy & Transportation segment. Of the total backlog at September 30, 2025, approximately $12.5 billion was not expected to be filled in the following twelve months.
NON-GAAP FINANCIAL MEASURES
We provide the following definitions for the non-GAAP financial measures used in this report. These non-GAAP financial measures have no standardized meaning prescribed by U.S. GAAP and therefore are unlikely to be comparable to the calculation of similar measures for other companies. Management does not intend these items to be considered in isolation or as a substitute for the related GAAP measures.
We believe it is important to separately quantify the profit impact of two significant items in order for the company’s results to be meaningful to our readers. These items consist of (i) other restructuring income/costs and (ii) restructuring income/costs related to the divestitures of certain non-U.S. entities in 2024. We do not consider these items indicative of earnings from ongoing business activities and believe the non-GAAP measure provides investors with useful perspective on underlying business results and trends and aids with assessing the company’s period-over-period results.
Reconciliations of adjusted results to the most directly comparable GAAP measures are as follows:
(Dollars in millions except per share data) Operating Profit Operating Profit Margin Profit Before Taxes Provision (Benefit) for Income Taxes Profit Profit per Share
Three Months Ended September 30, 2025 - U.S. GAAP $ 3,052 17.3 % $ 3,127 $ 836 $ 2,300 $ 4.88
Other restructuring (income) costs 37 0.2 % 37 9 28 0.07
Three Months Ended September 30, 2025 - Adjusted $ 3,089 17.5 % $ 3,164 $ 845 $ 2,328 $ 4.95
Three Months Ended September 30, 2024 - U.S. GAAP $ 3,147 19.5 % $ 3,098 $ 642 $ 2,464 $ 5.06
Other restructuring (income) costs 70 0.5 % 70 16 54 0.11
Three Months Ended September 30, 2024 - Adjusted $ 3,217 20.0 % $ 3,168 $ 658 $ 2,518 $ 5.17
Nine Months Ended September 30, 2025 - U.S. GAAP $ 8,491 17.5 % $ 8,515 $ 2,056 $ 6,482 $ 13.69
Other restructuring (income) costs 125 0.3 % 126 29 100 0.22
Nine Months Ended September 30, 2025 - Adjusted $ 8,616 17.8 % $ 8,641 $ 2,085 $ 6,582 $ 13.91
Nine Months Ended September 30, 2024 - U.S. GAAP $ 10,148 20.9 % $ 10,130 $ 2,166 $ 8,001 $ 16.27
Restructuring (income) costs - divestitures of certain non-U.S. entities 164 0.3 % 164 54 110 0.22
Other restructuring (income) costs 158 0.3 % 158 36 122 0.26
Nine Months Ended September 30, 2024 - Adjusted $ 10,470 21.5 % $ 10,452 $ 2,256 $ 8,233 $ 16.75

We believe it is important to separately disclose our annual effective tax rate, excluding discrete items for our results to be meaningful to our readers. The annual effective tax rate is discussed using non-GAAP financial measures that exclude the effects of amounts associated with discrete items recorded fully in the quarter they occur. These items consist of (i) the increase in the annual effective tax rate in 2025, (ii) the impact of changes in estimates related to prior years (iii) the settlement of stock-based compensation awards with associated tax deductions in excess of cumulative U.S. GAAP compensation expense and (iv) restructuring costs related to the divestitures of certain non-U.S. entities in 2024. We believe the non-GAAP measures will provide investors with useful perspective on underlying business results and trends and aids with assessing the company's period-over-period results.
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A reconciliation of our effective tax rate to annual effective tax rate, excluding discrete items is below:
(Millions of dollars) Profit Before Taxes Provision (Benefit) for Income Taxes Effective Tax Rate
Three Months Ended September 30, 2025 - U.S. GAAP $ 3,127 $ 836 26.7 %
Increase in annual effective tax rate — (54)
Changes in estimates related to prior years — (41)
Excess stock-based compensation — 10
Annual effective tax rate, excluding discrete items 3,127 751 24.0 %
Increase in annual effective tax rate — 54
Changes in estimates related to prior years — 41
Excess stock-based compensation — (10)
Other restructuring (income) costs 37 9
Three Months Ended September 30, 2025 - Adjusted $ 3,164 $ 845
Three Months Ended September 30, 2024 - U.S. GAAP $ 3,098 $ 642 20.7 %
Changes in estimates related to prior years — 47
Excess stock-based compensation — 7
Annual effective tax rate, excluding discrete items 3,098 696 22.5 %
Changes in estimates related to prior years — (47)
Excess stock-based compensation — (7)
Other restructuring (income) costs 70 16
Three Months Ended September 30, 2024 - Adjusted $ 3,168 $ 658
Nine Months Ended September 30, 2025 - U.S. GAAP $ 8,515 $ 2,056 24.1 %
Changes in estimates related to prior years — (41)
Excess stock-based compensation — 28
Annual effective tax rate, excluding discrete items 8,515 2,043 24.0 %
Changes in estimates related to prior years — 41
Excess stock-based compensation — (28)
Other restructuring (income) costs 126 29
Nine Months Ended September 30, 2025 - Adjusted $ 8,641 $ 2,085
Nine Months Ended September 30, 2024 - U.S. GAAP $ 10,130 $ 2,166 21.4 %
Restructuring (income) costs - divestitures of certain non-U.S. entities 164 54
Changes in estimates related to prior years — 47
Excess stock-based compensation — 49
Annual effective tax rate, excluding discrete items 10,294 2,316 22.5 %
Changes in estimates related to prior years — (47)
Excess stock-based compensation — (49)
Other restructuring (income) costs 158 36
Nine Months Ended September 30, 2024 - Adjusted $ 10,452 $ 2,256

In addition, we provide a calculation of ME&T free cash flow as we believe it is an important measure for investors to determine the cash generation available for financing activities including debt repayments, dividends and share repurchases.
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Reconciliations of ME&T free cash flow to the most directly comparable GAAP measure, net cash provided by operating activities are as follows:
(Millions of dollars) Nine Months Ended September 30,
2025 2024
ME&T net cash provided by operating activities 1 $ 7,745 $ 7,726
ME&T capital expenditures (1,944) (1,284)
ME&T free cash flow $ 5,801 $ 6,442
1 See reconciliation of ME&T net cash provided by operating activities to consolidated net cash provided by operating activities on pages 77 - 78 .

Supplemental Consolidating Data
 
We are providing supplemental consolidating data for the purpose of additional analysis.  The data has been grouped as follows:
 
Consolidated –
Caterpillar Inc. and its subsidiaries.
 
Machinery, Energy & Transportation –
We define ME&T as it is presented in the supplemental data as Caterpillar Inc. and its subsidiaries, excluding Financial Products. ME&T’s information relates to the design, manufacturing and marketing of our products.
 
Financial Products –
We define Financial Products as it is presented in the supplemental data as our finance and insurance subsidiaries, primarily Caterpillar Financial Services Corporation (Cat Financial) and Caterpillar Insurance Holdings Inc. (Insurance Services). Financial Products’ information relates to the financing to customers and dealers for the purchase and lease of Caterpillar and other equipment.
 
Consolidating Adjustments –
Eliminations of transactions between ME&T and Financial Products.
 
The nature of the ME&T and Financial Products businesses is different, especially with regard to the financial position and cash flow items. Caterpillar management utilizes this presentation internally to highlight these differences. We believe this presentation will assist readers in understanding our business.
Pages
71
-
78
reconcile ME&T and Financial Products to Caterpillar Inc. consolidated financial information.
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Caterpillar Inc.
Supplemental Data for Results of Operations
For the Three Months Ended September 30, 2025
(Unaudited)
(Millions of dollars)
Supplemental Consolidating Data
Consolidated Machinery, Energy & Transportation Financial Products Consolidating Adjustments
Sales and revenues:
Sales of Machinery, Energy & Transportation $ 16,726 $ 16,726 $ — $ —
Revenues of Financial Products 912 — 1,115 (203) 1
Total sales and revenues 17,638 16,726 1,115 (203)
Operating costs:
Cost of goods sold 11,673 11,675 — (2) 2
Selling, general and administrative expenses 1,822 1,608 218 (4) 2
Research and development expenses 555 555 — —
Interest expense of Financial Products 346 — 358 (12) 2
Other operating (income) expenses 190 (114) 336 (32) 2
Total operating costs 14,586 13,724 912 (50)
Operating profit 3,052 3,002 203 (153)
Interest expense excluding Financial Products 133 136 — (3) 3
Other income (expense) 208 25 33 150 4
Consolidated profit before taxes 3,127 2,891 236 —
Provision (benefit) for income taxes 836 773 63 —
Profit of consolidated companies 2,291 2,118 173 —
Equity in profit (loss) of unconsolidated affiliated companies 8 8 — —
Profit of consolidated and affiliated companies 2,299 2,126 173 —
Less: Profit (loss) attributable to noncontrolling interests (1) (1) — —
Profit 5 $ 2,300 $ 2,127 $ 173 $ —

 
1
Elimination of Financial Products’ revenues earned from ME&T.
2
Elimination of net expenses recorded between ME&T and Financial Products.
3
Elimination of interest expense recorded between Financial Products and ME&T.
4
Elimination of discount recorded by ME&T on receivables sold to Financial Products and of interest earned between ME&T and Financial Products as well as dividends paid by Financial Products to ME&T.
5
Profit attributable to common shareholders.

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Caterpillar Inc.
Supplemental Data for Results of Operations
For the Nine Months Ended September 30, 2025
(Unaudited)
(Millions of dollars)
 
Supplemental Consolidating Data
Consolidated Machinery, Energy & Transportation Financial Products Consolidating Adjustments
Sales and revenues:
Sales of Machinery, Energy & Transportation $ 45,778 $ 45,778 $ — $ —
Revenues of Financial Products 2,678 — 3,244 (566) 1
Total sales and revenues 48,456 45,778 3,244 (566)
Operating costs:
Cost of goods sold 31,445 31,451 — (6) 2
Selling, general and administrative expenses 5,109 4,513 623 (27) 2
Research and development expenses 1,586 1,586 — —
Interest expense of Financial Products 1,008 — 1,026 (18) 2
Other operating (income) expenses 817 (84) 979 (78) 2
Total operating costs 39,965 37,466 2,628 (129)
Operating profit 8,491 8,312 616 (437)
Interest expense excluding Financial Products 375 385 — (10) 3
Other income (expense) 399 (121) 93 427 4
Consolidated profit before taxes 8,515 7,806 709 —
Provision (benefit) for income taxes 2,056 1,878 178 —
Profit of consolidated companies 6,459 5,928 531 —
Equity in profit (loss) of unconsolidated affiliated companies 22 22 — —
Profit of consolidated and affiliated companies 6,481 5,950 531 —
Less: Profit (loss) attributable to noncontrolling interests (1) (2) 1 —
Profit 5 $ 6,482 $ 5,952 $ 530 $ —

 
1
Elimination of Financial Products’ revenues earned from ME&T.
2
Elimination of net expenses recorded between ME&T and Financial Products.
3
Elimination of interest expense recorded between Financial Products and ME&T.
4
Elimination of discount recorded by ME&T on receivables sold to Financial Products and of interest earned between ME&T and Financial Products as well as dividends paid by Financial Products to ME&T.
5
Profit attributable to common shareholders.

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Caterpillar Inc.
Supplemental Data for Results of Operations
For the Three Months Ended September 30, 2024
(Unaudited)
(Millions of dollars)
Supplemental Consolidating Data
Consolidated Machinery, Energy & Transportation Financial Products Consolidating Adjustments
Sales and revenues:
Sales of Machinery, Energy & Transportation $ 15,231 $ 15,231 $ — $ —
Revenues of Financial Products 875 — 1,078 (203) 1
Total sales and revenues 16,106 15,231 1,078 (203)
Operating costs:
Cost of goods sold 10,066 10,067 — (1) 2
Selling, general and administrative expenses 1,669 1,484 197 (12) 2
Research and development expenses 533 533 — —
Interest expense of Financial Products 336 — 336 —
Other operating (income) expenses 355 49 329 (23) 2
Total operating costs 12,959 12,133 862 (36)
Operating profit 3,147 3,098 216 (167)
Interest expense excluding Financial Products 125 127 — (2)
Other income (expense) 76 (122) 33 165 3
Consolidated profit before taxes 3,098 2,849 249 —
Provision (benefit) for income taxes 642 582 60 —
Profit of consolidated companies 2,456 2,267 189 —
Equity in profit (loss) of unconsolidated affiliated companies 7 7 — —
Profit of consolidated and affiliated companies 2,463 2,274 189 —
Less: Profit (loss) attributable to noncontrolling interests (1) (1) — —
Profit 4 $ 2,464 $ 2,275 $ 189 $ —

 
1
Elimination of Financial Products’ revenues earned from ME&T.
2
Elimination of net expenses recorded by ME&T paid to Financial Products.
3
Elimination of discount recorded by ME&T on receivables sold to Financial Products and of interest earned between ME&T and Financial Products as well as dividends paid by Financial Products to ME&T.
4
Profit attributable to common shareholders.

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Caterpillar Inc.
Supplemental Data for Results of Operations
For the Nine Months Ended September 30, 2024
(Unaudited)
(Millions of dollars)
Supplemental Consolidating Data
Consolidated Machinery, Energy & Transportation Financial Products Consolidating Adjustments
Sales and revenues:
Sales of Machinery, Energy & Transportation $ 46,031 $ 46,031 $ — $ —
Revenues of Financial Products 2,563 — 3,150 (587) 1
Total sales and revenues 48,594 46,031 3,150 (587)
Operating costs:
Cost of goods sold 29,878 29,883 — (5) 2
Selling, general and administrative expenses 4,898 4,346 560 (8) 2
Research and development expenses 1,588 1,588 — —
Interest expense of Financial Products 948 — 948 —
Other operating (income) expenses 1,134 51 1,174 (91) 2
Total operating costs 38,446 35,868 2,682 (104)
Operating profit 10,148 10,163 468 (483)
Interest expense excluding Financial Products 405 407 — (2)
Other income (expense) 387 (163) 69 481 3
Consolidated profit before taxes 10,130 9,593 537 —
Provision (benefit) for income taxes 2,166 1,983 183 —
Profit of consolidated companies 7,964 7,610 354 —
Equity in profit (loss) of unconsolidated affiliated companies 34 34 — —
Profit of consolidated and affiliated companies 7,998 7,644 354 —
Less: Profit (loss) attributable to noncontrolling interests (3) (4) 1 —
Profit 4 $ 8,001 $ 7,648 $ 353 $ —

 
1
Elimination of Financial Products’ revenues earned from ME&T.
2
Elimination of net expenses recorded between ME&T and Financial Products.
3
Elimination of discount recorded by ME&T on receivables sold to Financial Products and of interest earned between ME&T and Financial Products as well as dividends paid by Financial Products to ME&T.
4
Profit attributable to common shareholders.

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Caterpillar Inc.
Supplemental Data for Financial Position
At September 30, 2025
(Unaudited)
(Millions of dollars)
Supplemental Consolidating Data
Consolidated Machinery, Energy & Transportation Financial Products Consolidating Adjustments
Assets
Current assets:
Cash and cash equivalents $ 7,538 $ 6,633 $ 905 $ —
Receivables – trade and other 10,146 3,531 542 6,073 1,2
Receivables – finance 10,315 — 16,665 (6,350) 2
Prepaid expenses and other current assets 2,861 2,659 440 (238) 3
Inventories 18,958 18,958 — —
Total current assets 49,818 31,781 18,552 (515)
Property, plant and equipment – net 14,310 10,348 3,962 —
Long-term receivables – trade and other 1,618 1,712 166 (260) 1,2
Long-term receivables – finance 13,985 — 14,948 (963) 2
Noncurrent deferred and refundable income taxes 3,000 3,264 130 (394) 4
Intangible assets 281 281 — —
Goodwill 5,329 5,329 — —
Other assets 5,381 3,923 2,468 (1,010) 5
Total assets $ 93,722 $ 56,638 $ 40,226 $ (3,142)
Liabilities
Current liabilities:
Short-term borrowings $ 4,509 $ — $ 4,509 $ —
Accounts payable 8,729 8,636 391 (298) 6,7
Accrued expenses 5,187 4,558 629 —
Accrued wages, salaries and employee benefits 2,126 2,081 45 —
Customer advances 3,391 3,359 3 29 7
Dividends payable — — — —
Other current liabilities 2,760 2,209 806 (255) 4,5,8
Long-term debt due within one year 9,289 32 9,257 —
Total current liabilities 35,991 20,875 15,640 (524)
Long-term debt due after one year 27,736 10,899 18,067 (1,230) 7,9
Liability for postemployment benefits 3,664 3,663 1 —
Other liabilities 5,672 4,679 1,407 (414) 4,5
Total liabilities 73,063 40,116 35,115 (2,168)
Commitments and contingencies
Shareholders’ equity
Common stock 6,223 6,223 905 (905) 10
Treasury stock (48,302) (48,302) — —
Profit employed in the business 64,460 59,365 5,085 10 10
Accumulated other comprehensive income (loss) (1,723) (768) (955) —
Noncontrolling interests 1 4 76 (79) 10
Total shareholders’ equity 20,659 16,522 5,111 (974)
Total liabilities and shareholders’ equity $ 93,722 $ 56,638 $ 40,226 $ (3,142)

1    
Elimination of receivables between ME&T and Financial Products.
2    
Reclassification of ME&T’s trade receivables purchased by Financial Products and Financial Products’ wholesale inventory receivables.
3    
Elimination of ME&T’s insurance premiums that are prepaid to Financial Products.
4    
Reclassification reflecting required netting of deferred tax assets/liabilities by taxing jurisdiction.
5    
Elimination of other intercompany assets and liabilities between ME&T and Financial Products.
6    
Elimination of payables between ME&T and Financial Products.
7    
Reclassification of Financial Products' payables to customer advances.
8    
Elimination of prepaid insurance in Financial Products’ other liabilities.
9    
Elimination of debt between ME&T and Financial Products.
10    
Eliminations associated with ME&T’s investments in Financial Products’ subsidiaries.

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Caterpillar Inc.
Supplemental Data for Financial Position
At December 31, 2024
(Unaudited)
(Millions of dollars)
Supplemental Consolidating Data
Consolidated Machinery, Energy & Transportation Financial Products Consolidating Adjustments
Assets
Current assets:
Cash and cash equivalents $ 6,889 $ 6,165 $ 724 $ —
Receivables – trade and other 9,282 3,463 688 5,131 1,2
Receivables – finance 9,565 — 14,957 (5,392) 2
Prepaid expenses and other current assets 3,119 2,872 401 (154) 3
Inventories 16,827 16,827 — —
Total current assets 45,682 29,327 16,770 (415)
Property, plant and equipment – net 13,361 9,531 3,830 —
Long-term receivables – trade and other 1,225 500 86 639 1,2
Long-term receivables – finance 13,242 — 14,048 (806) 2
Noncurrent deferred and refundable income taxes 3,312 3,594 118 (400) 4
Intangible assets 399 399 — —
Goodwill 5,241 5,241 — —
Other assets 5,302 4,050 2,277 (1,025) 5
Total assets $ 87,764 $ 52,642 $ 37,129 $ (2,007)
Liabilities
Current liabilities:
Short-term borrowings $ 4,393 $ — $ 4,393 $ —
Accounts payable 7,675 7,619 331 (275) 6,7
Accrued expenses 5,243 4,589 654 —
Accrued wages, salaries and employee benefits 2,391 2,335 56 —
Customer advances 2,322 2,305 3 14 7
Dividends payable 674 674 — —
Other current liabilities 2,909 2,388 696 (175) 4,8
Long-term debt due within one year 6,665 46 6,619 —
Total current liabilities 32,272 19,956 12,752 (436)
Long-term debt due after one year 27,351 8,731 18,787 (167) 9
Liability for postemployment benefits 3,757 3,757 — —
Other liabilities 4,890 3,977 1,344 (431) 4
Total liabilities 68,270 36,421 32,883 (1,034)
Commitments and contingencies
Shareholders’ equity
Common stock 6,941 6,941 905 (905) 10
Treasury stock (44,331) (44,331) — —
Profit employed in the business 59,352 54,787 4,555 10 10
Accumulated other comprehensive income (loss) (2,471) (1,182) (1,289) —
Noncontrolling interests 3 6 75 (78) 10
Total shareholders’ equity 19,494 16,221 4,246 (973)
Total liabilities and shareholders’ equity $ 87,764 $ 52,642 $ 37,129 $ (2,007)

 
1    
Elimination of receivables between ME&T and Financial Products.
2    
Reclassification of ME&T’s trade receivables purchased by Financial Products and Financial Products’ wholesale inventory receivables.
3    
Elimination of ME&T’s insurance premiums that are prepaid to Financial Products.
4    
Reclassification reflecting required netting of deferred tax assets/liabilities by taxing jurisdiction.
5    
Elimination of other intercompany assets between ME&T and Financial Products.
6    
Elimination of payables between ME&T and Financial Products.
7    
Reclassification of Financial Products' payables to customer advances.
8    
Elimination of prepaid insurance in Financial Products' other liabilities.
9    
Elimination of debt between ME&T and Financial Products.
10    
Eliminations associated with ME&T’s investments in Financial Products’ subsidiaries.

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Caterpillar Inc.
Supplemental Data for Cash Flow
For the Nine Months Ended September 30, 2025
(Unaudited)
(Millions of dollars)
Supplemental Consolidating Data
Consolidated Machinery, Energy & Transportation Financial Products Consolidating Adjustments
Cash flow from operating activities:
Profit of consolidated and affiliated companies $ 6,481 $ 5,950 $ 531 $ —
Adjustments to reconcile profit to net cash provided by operating activities:
Depreciation and amortization 1,664 1,096 568 —
Provision (benefit) for deferred income taxes 300 308 (8) —
Other 509 431 (412) 490 1
Changes in assets and liabilities, net of acquisitions and divestitures:
Receivables – trade and other (788) 89 102 (979) 1,2
Inventories (2,015) (2,012) — (3) 1
Accounts payable 1,086 1,051 44 (9) 1
Accrued expenses 51 161 (110) —
Accrued wages, salaries and employee benefits (296) (284) (12) —
Customer advances 1,649 1,649 — —
Other assets – net (138) (219) 15 66 1
Other liabilities – net (355) (475) 176 (56) 1
Net cash provided by (used for) operating activities 8,148 7,745 894 (491)
Cash flow from investing activities:
Capital expenditures – excluding equipment leased to others (1,923) (1,920) (33) 30 1
Expenditures for equipment leased to others (1,021) (24) (1,004) 7 1
Proceeds from disposals of leased assets and property, plant and equipment 544 54 524 (34) 1
Additions to finance receivables (10,964) — (12,668) 1,704 2
Collections of finance receivables 9,890 — 11,347 (1,457) 2
Net intercompany purchased receivables — — (241) 241 2
Proceeds from sale of finance receivables 26 — 26 —
Additions to intercompany receivables (original maturities greater than three months) — (1,000) — 1,000 3
Collections of intercompany receivables (original maturities greater than three months) — — 56 (56) 3
Investments and acquisitions (net of cash acquired) (26) (26) — —
Proceeds from sale of businesses and investments (net of cash sold) 12 12 — —
Proceeds from maturities and sale of securities 1,945 1,259 686 —
Investments in securities (1,291) (510) (781) —
Other – net (19) 43 (62) —
Net cash provided by (used for) investing activities (2,827) (2,112) (2,150) 1,435
Cash flow from financing activities:
Dividends paid (2,043) (2,043) — —
Common stock issued, and other stock compensation transactions, net (39) (39) — —
Payments to purchase common stock (4,850) (4,850) — —
Excise tax paid on purchases of common stock (73) (73) — —
Proceeds from intercompany borrowings (original maturities greater than three months) — — 1,000 (1,000) 3
Payments on intercompany borrowings (original maturities greater than three months) — (56) — 56 3
Proceeds from debt issued (original maturities greater than three months) 8,454 1,976 6,478 —
Payments on debt (original maturities greater than three months) (6,205) (43) (6,162) —
Short-term borrowings – net (original maturities three months or less) 106 — 106 —
Net cash provided by (used for) financing activities (4,650) (5,128) 1,422 (944)
Effect of exchange rate changes on cash (23) (39) 16 —
Increase (decrease) in cash, cash equivalents and restricted cash 648 466 182 —
Cash, cash equivalents and restricted cash at beginning of period 6,896 6,170 726 —
Cash, cash equivalents and restricted cash at end of period $ 7,544 $ 6,636 $ 908 $ —

1    
Elimination of non-cash adjustments and changes in assets and liabilities related to consolidated reporting.
2    
Reclassification of Financial Products’ cash flow activity from investing to operating for receivables that arose from the sale of inventory.
3    
Elimination of proceeds and payments to/from ME&T and Financial Products.

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Caterpillar Inc.
Supplemental Data for Cash Flow
For the Nine Months Ended September 30, 2024
(Unaudited)
(Millions of dollars)
Supplemental Consolidating Data
Consolidated Machinery, Energy & Transportation Financial Products Consolidating Adjustments
Cash flow from operating activities:
Profit of consolidated and affiliated companies $ 7,998 $ 7,644 $ 354 $ —
Adjustments to reconcile profit to net cash provided by operating activities:
Depreciation and amortization 1,598 1,010 588 —
Provision (benefit) for deferred income taxes (329) (277) (52) —
(Gain) loss on divestiture 164 (46) 210 —
Other 221 236 (447) 432 1
Changes in assets and liabilities, net of acquisitions and divestitures:
Receivables – trade and other (30) 554 (17) (567) 1.2
Inventories (781) (770) — (11) 1
Accounts payable (96) (79) (40) 23 1
Accrued expenses 9 — 9 —
Accrued wages, salaries and employee benefits (671) (660) (11) —
Customer advances 476 475 1 —
Other assets – net 120 (226) 191 155 1
Other liabilities – net (37) (135) 232 (134) 1
Net cash provided by (used for) operating activities 8,642 7,726 1,018 (102)
Cash flow from investing activities:
Capital expenditures – excluding equipment leased to others (1,285) (1,264) (25) 4 1
Expenditures for equipment leased to others (893) (20) (889) 16 1
Proceeds from disposals of leased assets and property, plant and equipment 541 25 525 (9) 1
Additions to finance receivables (11,457) — (12,271) 814 2
Collections of finance receivables 10,234 — 10,889 (655) 2
Net intercompany purchased receivables — — 68 (68) 2
Proceeds from sale of finance receivables 69 — 69 —
Net intercompany borrowings — — 15 (15) 3
Investments and acquisitions (net of cash acquired) (32) (32) — —
Proceeds from sale of businesses and investments (net of cash sold) (67) 86 (153) —
Proceeds from maturities and sale of securities 2,841 2,565 276 —
Investments in securities (892) (469) (423) —
Other – net 137 118 19 —
Net cash provided by (used for) investing activities (804) 1,009 (1,900) 87
Cash flow from financing activities:
Dividends paid (1,966) (1,966) — —
Common stock issued, including treasury shares reissued 15 15 — —
Payments to purchase common stock (7,057) (7,057) — —
Net intercompany borrowings — (15) — 15 3
Proceeds from debt issued (original maturities greater than three months) 7,579 — 7,579 —
Payments on debt (original maturities greater than three months) (6,862) (1,021) (5,841) —
Short-term borrowings – net (original maturities three months or less) (848) — (848) —
Net cash provided by (used for) financing activities (9,139) (10,044) 890 15
Effect of exchange rate changes on cash (39) (37) (2) —
Increase (decrease) in cash, cash equivalents and restricted cash (1,340) (1,346) 6 —
Cash, cash equivalents and restricted cash at beginning of period 6,985 6,111 874 —
Cash, cash equivalents and restricted cash at end of period $ 5,645 $ 4,765 $ 880 $ —

1    
Elimination of non-cash adjustments and changes in assets and liabilities related to consolidated reporting.
2    
Reclassification of Financial Products’ cash flow activity from investing to operating for receivables that arose from the sale of inventory.
3    
Elimination of net proceeds and payments to/from ME&T and Financial Products.

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Forward-looking Statements
Certain statements in this Form 10-Q relate to future events and expectations and are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “believe,” “estimate,” “will be,” “will,” “would,” “expect,” “anticipate,” “plan,” “forecast,” “target,” “guide,” “project,” “intend,” “could,” “should” or other similar words or expressions often identify forward-looking statements. All statements other than statements of historical fact are forward-looking statements, including, without limitation, statements regarding our outlook, projections, forecasts or trend descriptions. These statements do not guarantee future performance and speak only as of the date they are made, and we do not undertake to update our forward-looking statements.
Caterpillar’s actual results may differ materially from those described or implied in our forward-looking statements based on a number of factors, including, but not limited to: (i) global and regional economic conditions and economic conditions in the industries we serve; (ii) commodity price changes, material price increases, fluctuations in demand for our products or significant shortages of material; (iii) government monetary or fiscal policies; (iv) political and economic risks, commercial instability and events beyond our control in the countries in which we operate; (v) international trade policies and their impact on demand for our products and our competitive position, including the imposition of new tariffs or changes in existing tariff rates; (vi) our ability to develop, produce and market quality products that meet our customers’ needs; (vii) the impact of the highly competitive environment in which we operate on our sales and pricing; (viii) information technology security threats and computer crime; (ix) inventory management decisions and sourcing practices of our dealers and our OEM customers; (x) a failure to realize, or a delay in realizing, all of the anticipated benefits of our acquisitions, joint ventures or divestitures; (xi) union disputes or other employee relations issues; (xii) adverse effects of unexpected events; (xiii) disruptions or volatility in global financial markets limiting our sources of liquidity or the liquidity of our customers, dealers and suppliers; (xiv) failure to maintain our credit ratings and potential resulting increases to our cost of borrowing and adverse effects on our cost of funds, liquidity, competitive position and access to capital markets; (xv) our Financial Products segment’s risks associated with the financial services industry; (xvi) changes in interest rates or market liquidity conditions; (xvii) an increase in delinquencies, repossessions or net losses of Cat Financial’s customers; (xviii) currency fluctuations; (xix) our or Cat Financial’s compliance with financial and other restrictive covenants in debt agreements; (xx) increased pension plan funding obligations; (xxi) alleged or actual violations of trade or anti-corruption laws and regulations; (xxii) additional tax expense or exposure, including the impact of U.S. tax reform; (xxiii) significant legal proceedings, claims, lawsuits or government investigations; (xxiv) new regulations or changes in financial services regulations; (xxv) compliance with environmental laws and regulations; (xxvi) catastrophic events, including global pandemics such as the COVID-19 pandemic; and (xxvii) other factors described in more detail under the section entitled "Part I - Item 1A. Risk Factors" of Caterpillar's Annual Report on Form 10-K for the fiscal year ended December 31, 2024, as such factors may be updated from time to time in Caterpillar's periodic filings with the Securities and Exchange Commission.
Item 3.  Quantitative and Qualitative Disclosures About Market Risk
 
The information required by this Item is incorporated by reference from Note 5 – “Derivative financial instruments and risk management” included in Part I, Item 1 and Management’s Discussion and Analysis included in Part I, Item 2 of this Form 10-Q.
 
Item 4.  Controls and Procedures
 
Evaluation of disclosure controls and procedures
 
An evaluation was performed under the supervision and with the participation of the company’s management, including the Chief Executive Officer (CEO) and Chief Financial Officer (CFO), of the effectiveness of the design and operation of the company’s disclosure controls and procedures, as that term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended, as of the end of the period covered by this quarterly report.  Based on that evaluation, the CEO and CFO concluded that the company’s disclosure controls and procedures were effective as of the end of the period covered by this quarterly report.
Changes in internal control over financial reporting
 
During the third quarter of 2025, there has been no change in the company’s internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting.
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PART II.  OTHER INFORMATION
 
Item 1.  Legal Proceedings
 
The information required by this Item is incorporated by reference from Note 14 – “Environmental and legal matters” included in Part I, Item 1 of this Form 10-Q.    
Item 1A. Risk Factors
There have been no material changes to the risk factors we previously disclosed in our Annual Report on
Form 10-K
for the year ended December 31, 2024.
Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds
 
Issuer Purchases of Equity Securities
Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Program Approximate Dollar Value of Shares that May Yet be Purchased under the Program (in billions) 1
July 1-31, 2025 321,671 $ 410.33 321,671 $ 15.508
August 1-31, 2025 297,850 $ 423.01 297,850 $ 15.382
September 1-30, 2025 228,478 $ 446.41 228,478 $ 15.280
Total 847,999 $ 424.50 847,999
1 In May 2022, the Board approved a share repurchase authorization (the 2022 Authorization) of up to $15.0 billion of Caterpillar common stock effective August 1, 2022, with no expiration. In June 2024, the Board approved an additional share repurchase authorization (the 2024 Authorization) of up to $20.0 billion of Caterpillar common stock, effective June 12, 2024, with no expiration. As of March 31,2025, the 2022 Authorization was fully utilized and as of September 30,2025, approximately $15.3 billion remained available under the 2024 Authorization.

Non-U.S. Employee Stock Purchase Plans
 
As of September 30, 2025, we had 38 employee stock purchase plans (the “EIP Plans”) that are administered outside the United States for our non-U.S. employees, which had approximately 17,000 active participants in the aggregate. During the third quarter of 2025, approximately 46,000 shares of Caterpillar common stock were purchased by the EIP Plans pursuant to the terms of such plans.
Item 5.
Other Information
On
August 12, 2025
,
Jason E. Kaiser
,
Group President
of our Energy & Transportation segment,
entered
into a Rule 10b5-1 sales plan intended to satisfy the affirmative defense of Rule 10b5-1(c) under the Securities Exchange Act of 1934, as amended. The sales plan will be in effect until the earlier of (1)
August 12, 2026
and (2) the date on which (i) an aggregate of
16,881
shares of our common stock and (ii) all shares vested as of December 31, 2025 pursuant to a Performance Stock Unit (PSU) grant have been sold under the plan.
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Item 6. Exhibits
10.1 364-Day Credit Agreement (incorporated by reference from Exhibit 10.1 to the Company's Current Report on Form 8-K filed September 3, 2025)
10.2 CIF Local Currency Addendum to the 364-Day Credit Agreement (incorporated by reference from Exhibit 10.2 to the Company's Current Report on Form 8-K filed September 3, 2025)
10.3 CIF LUX Local Currency Addendum to the 364-Day Credit Agreement (incorporated by reference from Exhibit 10.3 to the Company's Current Report on Form 8-K filed September 3, 2025)
10.4 Japan Local Currency Addendum to the 364-Day Credit Agreement (incorporated by reference from Exhibit 10.4 to the Company's Current Report on Form 8-K filed September 3, 2025)
10.5 Fourth Amended and Restated Credit Agreement (Three-Year Facility) (incorporated by reference from Exhibit 10.5 to the Company's Current Report on Form 8-K filed September 3, 2025)
10.6 CIF Local Currency Addendum to the Fourth Amended and Restated Credit Agreement (Three-Year Facility) (incorporated by reference from Exhibit 10.6 to the Company's Current Report on Form 8-K filed September 3, 2025)
10.7 CIF LUX Local Currency Addendum to the Fourth Amended and Restated Credit Agreement (Three-Year Facility) (incorporated by reference from Exhibit 10.7 to the Company's Current Report on Form 8-K filed September 3, 2025)
10.8 Japan Local Currency Addendum to the Fourth Amended and Restated Credit Agreement (Three-Year Facility) (incorporated by reference from Exhibit 10.8 to the Company's Current Report on Form 8-K filed September 3, 2025)
10.9 Fourth Amended and Restated Credit Agreement (Five-Year Facility) (incorporated by reference from Exhibit 10.9 to the Company's Current Report on Form 8-K filed September 3, 2025)
10.10 CIF Local Currency Addendum to the Fourth Amended and Restated Credit Agreement (Five-Year Facility) (incorporated by reference from Exhibit 10.10 to the Company's Current Report on Form 8-K filed September 3, 2025)
10.11 CIF LUX Local Currency Addendum to the Fourth Amended and Restated Credit Agreement (Five-Year Facility) (incorporated by reference from Exhibit 10.11 to the Company's Current Report on Form 8-K filed September 3, 2025)
10.12 Japan Local Currency Addendum to the Fourth Amended and Restated Credit Agreement (Five-Year Facility) (incorporated by reference from Exhibit 10.12 to the Company's Current Report on Form 8-K filed September 3, 2025)
31.1 Certification of Chief Executive Officer of Caterpillar Inc., as required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2 Certification of Chief Financial Officer of Caterpillar Inc., as required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32 Certification of Chief Executive Officer of Caterpillar Inc. and Chief Financial Officer of Caterpillar Inc., as required pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)
101.SCH Inline XBRL Taxonomy Extension Schema Document
101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document
104 Cover Page Interactive File (embedded within the Inline XBRL document and included in Exhibit 101)

The agreements and other documents filed as exhibits to this report are not intended to provide factual information or other disclosure other than with respect to the terms of the agreements or other documents themselves, and you should not rely on them for that purpose. In particular, any representations and warranties made by us in these agreements or other documents
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were made solely within the specific context of the relevant agreement or document and may not describe the actual state of affairs as of the date they were made or at any other time.
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SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
 
 
CATERPILLAR INC.
November 3, 2025 /s/ Joseph E. Creed Chief Executive Officer
Joseph E. Creed
November 3, 2025 /s/ Andrew R.J. Bonfield Chief Financial Officer
Andrew R.J. Bonfield
November 3, 2025 /s/ Derek Owens Chief Legal Officer and General Counsel
Derek Owens
November 3, 2025 /s/ William E. Schaupp Vice President and Chief Accounting Officer
William E. Schaupp

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