Construction and mining equipment major Caterpillar says US tariffs are eating into its earnings margins and will have a “net incremental” US$1.3-1.5 billion impact on its 2025 full-year profit.
The company reported lower construction and resources division sales and segment profits for the June quarter compared with Q2 in 2024. Energy & Transportation results were stronger year-on-year.
Q2 2025 resources (mining and quarrying) sales were $3.1 billion versus $3.2 a year ago and segment profit fell from $718 million in 2024 to $537 million in the latest quarter. Caterpillar said the 25% segment profit dip was partly due to higher manufacturing costs which were primarily due to the “impact of higher tariffs”.
Construction sales meanwhile decreased 7% yoy to $6.2 billion in Q2 2025 while segment profit plunged 29% on “unfavourable price realisation [and] an impact of higher tariffs”.
Caterpillar said it expected to take a $400-500 million hit from “net incremental tariffs” in Q3.
It maintains 2025 full-year group revenues will be “slightly higher” than last year’s $64.8 billion.
“Excluding the net impact of incremental tariffs 2025 full-year adjusted operating profit margin [will be] in the top half of the annual target range,” the company said.
“Including the net impact of incremental tariffs 2025 full-year adjusted operating profit margin [will be] in the bottom half of the annual target range.”
New York-listed Caterpillar’s share price is up more than 21% over the past 12 months, capitalising the company currently at about $191 billion.
