What changed in this filing

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Item 1. Financial Statements

2024-11-06 compared with 2024-08-07 · 141 added, 146 removed, 1301 unchanged (18% of the section changed)

3 unchanged sentences

(Dollars in millions except per share data)

Three Months Ended June 30,

Three Months Ended September 30,

Sales and revenues:

30 unchanged sentences

(Dollars in millions)

Three Months Ended June 30,

Three Months Ended September 30,

Profit of consolidated and affiliated companies $ 2,463 $ 2,793

1 unchanged sentence

Foreign currency translation:

( 71 ) ( 142 )

Pension and other postretirement benefits:

Derivative financial instruments:

( 62 ) ( 41 )

Available-for-sale securities:

7 unchanged sentences

(Dollars in millions except per share data)

Six Months Ended June 30,

Nine Months Ended September 30,

Sales and revenues:

30 unchanged sentences

(Dollars in millions)

Six Months Ended June 30,

Nine Months Ended September 30,

Profit of consolidated and affiliated companies $ 7,998 $ 7,659

12 unchanged sentences

(Dollars in millions)

September 30,

2024 December 31,

58 unchanged sentences

interests Total

Three Months Ended June 30, 2023

Balance at March 31, 2023 $ 6,546 $ ( 32,108 ) $ 45,457 $ ( 1,746 ) $ 21 $ 18,170

Three Months Ended September 30, 2023

Balance at June 30, 2023 $ 6,478 $ ( 33,391 ) $ 47,094 $ ( 1,946 ) $ 21 $ 18,256

Profit (loss) of consolidated and affiliated companies — — 2,794 — ( 1 ) 2,793

3 unchanged sentences

Available-for-sale securities, net of tax — — — ( 16 ) — ( 16 )

Dividends declared 1

— — ( 1,285 ) — — ( 1,285 )

Common shares issued from treasury stock for stock-based compensation:

5 unchanged sentences

Other 10 ( 3 ) — — ( 2 ) 5

Balance at September 30, 2023 $ 6,698 $ ( 33,865 ) $ 49,888 $ ( 2,232 ) $ 18 $ 20,507

Three Months Ended September 30, 2024

Balance at June 30, 2024 $ 5,517 $ ( 41,612 ) $ 55,455 $ ( 2,230 ) $ 6 $ 17,136

Three Months Ended June 30, 2024

Balance at March 31, 2024 $ 5,663 $ ( 40,039 ) $ 54,108 $ ( 2,093 ) $ 6 $ 17,645

Profit (loss) of consolidated and affiliated companies — — 2,464 — ( 1 ) 2,463

4 unchanged sentences

Dividends declared — — 1 — — 1

— — ( 1,334 ) — — ( 1,334 )

Common shares issued from treasury stock for stock-based compensation:

3 unchanged sentences

— ( 782 ) — — — ( 782 )

Outstanding authorized accelerated share repurchase ( 250 ) — — — — ( 250 )

Other 19 ( 6 ) — — 1 14

Balance at June 30, 2024 $ 5,517 $ ( 41,612 ) $ 55,455 $ ( 2,230 ) $ 6 $ 17,136

1 Dividends per share of common stock of $ 2.71 and $ 2.50 were declared in the three months ended June 30, 2024 and 2023, respectively .

Balance at September 30, 2024 $ 5,584 $ ( 42,390 ) $ 57,920 $ ( 1,717 ) $ 6 $ 19,403

1 See Note 12 for additional information.

8 unchanged sentences

interests Total

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

Balance at December 31, 2022 $ 6,560 $ ( 31,748 ) $ 43,514 $ ( 2,457 ) $ 22 $ 15,891

9 unchanged sentences

Stock-based compensation expense 178 — — — — 178

Outstanding authorized accelerated stock repurchases ( 150 ) — — — — ( 150 )

Common shares repurchased:

1 unchanged sentence

Other 31 ( 16 ) — — ( 4 ) 11

Balance at June 30, 2023 $ 6,478 $ ( 33,391 ) $ 47,094 $ ( 1,946 ) $ 21 $ 18,256

Six Months Ended June 30, 2024

Balance at September 30, 2023 $ 6,698 $ ( 33,865 ) $ 49,888 $ ( 2,232 ) $ 18 $ 20,507

Nine Months Ended September 30, 2024

Balance at December 31, 2023 $ 6,403 $ ( 36,339 ) $ 51,250 $ ( 1,820 ) $ 9 $ 19,503

11 unchanged sentences

— ( 6,057 ) — — — ( 6,057 )

Outstanding authorized accelerated stock repurchases ( 1,000 ) — — — — ( 1,000 )

Outstanding authorized accelerated share repurchases ( 1,000 ) — — — — ( 1,000 )

Other 55 ( 53 ) — — — 2

Balance at June 30, 2024 $ 5,517 $ ( 41,612 ) $ 55,455 $ ( 2,230 ) $ 6 $ 17,136

1 Dividends per share of common stock of $ 2.71 and $ 2.50 were declared in the six months ended June 30, 2024 and 2023, respectively.

Balance at September 30, 2024 $ 5,584 $ ( 42,390 ) $ 57,920 $ ( 1,717 ) $ 6 $ 19,403

1 Dividends per share of common stock of $ 2.71 and $ 2.50 were declared in the nine months ended September 30, 2024 and 2023, respectively.

2 See Note 12 for additional information.

3 unchanged sentences

(Dollars in Millions)

Six Months Ended June 30,

Nine Months Ended September 30,

Cash flow from operating activities:

55 unchanged sentences

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 six months ended June 30, 2024 and 2023, (b) the consolidated comprehensive income for the three and six months ended June 30, 2024 and 2023, (c) the consolidated financial position at June 30, 2024 and December 31, 2023, (d) the consolidated changes in shareholders’ equity for the three and six months ended June 30, 2024 and 2023 and (e) the consolidated cash flow for the six months ended June 30, 2024 and 2023.

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, 2024 and 2023, (b) the consolidated comprehensive income for the three and nine months ended September 30, 2024 and 2023, (c) the consolidated financial position at September 30, 2024 and December 31, 2023, (d) the consolidated changes in shareholders’ equity for the three and nine months ended September 30, 2024 and 2023 and (e) the consolidated cash flow for the nine months ended September 30, 2024 and 2023.

The financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America (U.S.

17 unchanged sentences

Accounting standards issued but not yet adopted

Segment reporting (ASU 2023-07) — In November 2023, the Financial Accounting Standards Board (FASB) issued accounting guidance that requires incremental disclosures related to reportable segments which includes significant segment expense categories and amounts for each reportable segment.

The expanded annual disclosures are effective

for our year ending December 31, 2024, and the expanded interim disclosures are effective in 2025 and will be applied retrospectively to all prior periods presented.

We are in the process of evaluating the effect of this new guidance on the related disclosures.

segment expense categories and amounts for each reportable segment.

The expanded annual disclosures are effective for our year ending December 31, 2024, and the expanded interim disclosures are effective in 2025 and will be applied retrospectively to all prior periods presented.

Income tax reporting (ASU 2023-09) — In December 2023, the FASB issued accounting guidance to expand the annual disclosure requirements for income taxes, primarily related to the rate reconciliation and income taxes paid.

6 unchanged sentences

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 $ 8,024 million, $ 7,923 million and $ 7,551 million as of June 30, 2024, December 31, 2023 and December 31, 2022, respectively.

Long-term trade receivables from dealers and end users were $ 625 million, $ 589 million and $ 506 million as of June 30, 2024, December 31, 2023 and December 31, 2022, respectively.

Trade receivables from dealers and end users were $ 7,798 million, $ 7,923 million and $ 7,551 million as of September 30, 2024, December 31, 2023 and December 31, 2022, respectively.

Long-term trade receivables from dealers and end users were $ 635 million, $ 589 million and $ 506 million as of September 30, 2024, December 31, 2023 and December 31, 2022, respectively.

For certain contracts, we invoice for payment when contractual milestones are achieved.

2 unchanged sentences

Contract assets are included in Prepaid expenses and other current assets in the Consolidated Statement of Financial Position.

Contract assets were $ 243 million, $ 246 million and $ 247 million as of June 30, 2024, December 31, 2023 and December 31, 2022, respectively.

Contract assets were $ 218 million, $ 246 million and $ 247 million as of September 30, 2024, December 31, 2023 and December 31, 2022, 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 $ 2,728 million, $ 2,389 million and $ 2,314 million as of June 30, 2024, December 31, 2023 and December 31, 2022, respectively.

Contract liabilities were $ 2,868 million, $ 2,389 million and $ 2,314 million as of September 30, 2024, December 31, 2023 and December 31, 2022, respectively.

We reduce the contract liability when revenue is recognized.

During the three and six months ended June 30, 2024, we recognized $ 360 million and $ 1,173 million, respectively, of revenue that was recorded as a contract liability at the beginning of 2024.

During the three and six months ended June 30, 2023, we recognized $ 398 million and $ 1,135 million, respectively.

As of June 30, 2024, 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 $ 13.4 billion, with about one-half of the amount expected to be completed and revenue recognized in the twelve months following June 30, 2024.

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.

During the three and nine months ended September 30, 2023, we recognized $ 197 million and $ 1,333 million, respectively.

As of September 30, 2024, 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 $ 14.1 billion, with about one-half of the amount expected to be completed and revenue recognized in the twelve months following September 30, 2024.

We have elected the practical expedient not to disclose unsatisfied performance obligations with an original contract duration of one year or less.

4 unchanged sentences

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 $ 75 million and $ 119 million for the three and six months ended June 30, 2024, respectively, and $ 74 million and $ 118 million for the three and six months ended June 30, 2023, respectively.

The following table illustrates the type and fair value of the stock-based compensation awards granted during the six months ended June 30, 2024 and 2023, respectively:

Six Months Ended June 30, 2024 Six Months Ended June 30, 2023

We recognized pretax stock-based compensation expense of $ 52 million and $ 171 million for the three and nine months ended September 30, 2024, respectively, and $ 60 million and $ 178 million for the three and nine months ended September 30, 2023, respectively.

The following table illustrates the type and fair value of the stock-based compensation awards granted during the nine months ended September 30, 2024 and 2023, respectively:

Nine Months Ended September 30, 2024 Nine Months Ended September 30, 2023

Shares Granted Weighted-Average Fair Value Per Share Weighted-Average Grant Date Stock Price Shares Granted Weighted-Average Fair Value Per Share Weighted-Average Grant Date Stock Price

3 unchanged sentences

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 six months ended June 30, 2024 and 2023, respectively:

The following table provides the assumptions used in determining the fair value of the stock-options granted in the nine months ended September 30, 2024 and 2023, respectively:

Weighted-average dividend yield 2.40 % 2.60 %

6 unchanged sentences

The PRSUs granted in 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 six months ended June 30, 2024:

The following table provides the assumptions used in determining the fair value of the PRSUs granted in the nine months ended September 30, 2024:

Expected volatility of the Company's stock 29.8 %

Risk-free interest rate 4.38 %

As of June 30, 2024, the total remaining unrecognized compensation expense related to nonvested stock-based compensation awards was $ 241 million, which will be amortized over the weighted-average remaining requisite service periods of approximately 1.8 years.

As of September 30, 2024, the total remaining unrecognized compensation expense related to nonvested stock-based compensation awards was $ 173 million, which will be amortized over the weighted-average remaining requisite service periods of approximately 1.9 years.

Derivative financial instruments and risk management

27 unchanged sentences

Our policy allows for managing anticipated foreign currency cash flow for up to approximately five years .

As of June 30, 2024, the maximum term of these outstanding contracts at inception was approximately 60 months.

As of September 30, 2024, 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.

35 unchanged sentences

(Millions of dollars) Fair Value

June 30, 2024 December 31, 2023

September 30, 2024 December 31, 2023

Liabilities 2

11 unchanged sentences

2 Liabilities are classified as Accrued expenses or Other liabilities.

The total notional amounts of the derivative instruments as of June 30, 2024 and December 31, 2023 were $ 24.7 billion and $ 25.6 billion, respectively.

The total notional amounts of the derivative instruments as of September 30, 2024 and December 31, 2023 were $ 26.1 billion and $ 25.6 billion, respectively.

The notional amounts of the derivative financial instruments do not represent amounts exchanged by the parties.

1 unchanged sentence

Gains (Losses) on derivative instruments are categorized as follows:

(Millions of dollars) Three Months Ended June 30,

(Millions of dollars) Three Months Ended September 30,

Fair Value / Undesignated Hedges Cash Flow Hedges

11 unchanged sentences

Interest rate contract gains (losses) are primarily included in Interest expense of Financial Products.

(Millions of dollars) Six Months Ended June 30,

(Millions of dollars) Nine Months Ended September 30,

Fair Value / Undesignated Hedges Cash Flow Hedges

13 unchanged sentences

(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

June 30, 2024 December 31, 2023 June 30, 2024 December 31, 2023

September 30, 2024 December 31, 2023 September 30, 2024 December 31, 2023

Long-term debt due within one year $ 948 $ 982 $ ( 2 ) $ ( 23 )

5 unchanged sentences

Collateral is typically not required of the counterparties or of our company under the master netting agreements.

As of June 30, 2024 and December 31, 2023, no cash collateral was received or pledged under the master netting agreements.

As of September 30, 2024 and December 31, 2023, 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) June 30, 2024 December 31, 2023

(Millions of dollars) September 30, 2024 December 31, 2023

Assets Liabilities Assets Liabilities

3 unchanged sentences

Inventories (principally using the last-in, first-out (LIFO) method) were comprised of the following:

(Millions of dollars) June 30,

(Millions of dollars) September 30,

2024 December 31,

7 unchanged sentences

Intangible assets were comprised of the following:

June 30, 2024

September 30, 2024

(Millions of dollars) Gross

12 unchanged sentences

Total finite-lived intangible assets $ 2,833 $ ( 2,269 ) $ 564

Amortization expense for the three and six months ended June 30, 2024 was $ 43 million and $ 87 million, respectively.

Amortization expense for the three and six months ended June 30, 2023 was $ 64 million and $ 130 million, respectively.

Amortization expense for the three and nine months ended September 30, 2024 was $ 44 million and $ 131 million, respectively.

Amortization expense for the three and nine months ended September 30, 2023 was $ 44 million and $ 174 million, respectively.

Amortization expense related to intangible assets is expected to be:

(Millions of dollars)

Remaining Six Months of 2024 2025 2026 2027 2028 Thereafter

Remaining Three Months of 2024 2025 2026 2027 2028 Thereafter

$ 44 $ 167 $ 97 $ 34 $ 26 $ 80

No goodwill was impaired during the six months ended June 30, 2024 or 2023.

The changes in carrying amount of goodwill by reportable segment for the six months ended June 30, 2024 were as follows:

No goodwill was impaired during the nine months ended September 30, 2024 or 2023.

The changes in carrying amount of goodwill by reportable segment for the nine months ended September 30, 2024 were as follows:

(Millions of dollars) December 31,

2023 Other Adjustments 1

September 30,

Construction Industries

25 unchanged sentences

Available-for-sale debt securities

June 30, 2024 December 31, 2023

September 30, 2024 December 31, 2023

(Millions of dollars) Cost

13 unchanged sentences

Available-for-sale debt securities in an unrealized loss position:

June 30, 2024

September 30, 2024

Less than 12 months 1

8 unchanged sentences

governmental agency — — 278 19 278 19

Residential — — 1 1 1 1

Commercial — — 113 5 113 5

16 unchanged sentences

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 June 30, 2024.

The cost basis and fair value of available-for-sale debt securities at June 30, 2024, by contractual maturity, are shown below.

In addition, we did not expect credit-related losses on these investments as of September 30, 2024.

The cost basis and fair value of available-for-sale debt securities at September 30, 2024, 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.

June 30, 2024

September 30, 2024

(Millions of dollars) Cost Basis Fair Value

8 unchanged sentences

Sales of available-for-sale debt securities:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(Millions of dollars) 2024 2023 2024 2023

3 unchanged sentences

In addition, we had $ 1,900 million of investments in time deposits classified as held-to-maturity debt securities as of December 31, 2023.

We did not have any investments classified as held-to-maturity debt securities as of June 30, 2024.

We did not have any investments classified as held-to-maturity debt securities as of September 30, 2024.

These investments matured within one year and were included in Prepaid expenses and other current assets in the Consolidated Statement of Financial Position.

We record held-to-maturity debt securities at amortized cost, which approximates fair value.

For the three months ended June 30, 2024 and 2023, the net unrealized gains (losses) for equity securities held at June 30, 2024 and 2023 were $( 3 ) million and $( 4 ) million, respectively.

For the six months ended June 30, 2024 and 2023, the net unrealized gains (losses) for equity securities held at June 30, 2024 and 2023 were $ 14 million and $( 14 ) million, respectively.

For the three months ended September 30, 2024 and 2023, the net unrealized gains (losses) for equity securities held at September 30, 2024 and 2023 were $ 18 million and $( 11 ) million, respectively.

For the nine months ended September 30, 2024 and 2023, the net unrealized gains (losses) for equity securities held at September 30, 2024 and 2023 were $ 32 million and $( 25 ) million, respectively.

Postretirement benefits

1 unchanged sentence

Postretirement

June 30, June 30, June 30,

September 30, September 30, September 30,

(Millions of dollars) 2024 2023 2024 2023 2024 2023

7 unchanged sentences

$ ( 18 ) $ ( 9 ) $ ( 1 ) $ — $ 44 $ 47

For the six months ended:

For the nine months ended:

Components of net periodic benefit cost:

7 unchanged sentences

All other components are included in Other income (expense).

We made $ 59 million and $ 172 million of contributions to our pension and other postretirement plans during the three and six months ended June 30, 2024, respectively.

We made $ 49 million and $ 221 million of contributions to our pension and other postretirement plans during the three and nine months ended September 30, 2024, respectively.

We currently anticipate full-year 2024 contributions of approximately $ 273 million.

1 unchanged sentence

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 June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(Millions of dollars) 2024 2023 2024 2023

6 unchanged sentences

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 June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(Millions of dollars) 2024 2023 2024 2023

6 unchanged sentences

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 $ 406 million and $ 353 million at June 30, 2024 and December 31, 2023, 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.

7 unchanged sentences

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 June 30, 2024 and December 31, 2023, the SPC’s assets of $ 1.35 billion and $ 1.35 billion, respectively, were primarily comprised of loans to dealers, and the SPC’s liabilities of $ 1.35 billion and $ 1.35 billion, respectively, were primarily comprised of commercial paper.

As of September 30, 2024 and December 31, 2023, the SPC’s assets of $ 1.31 billion and $ 1.35 billion, respectively, were primarily comprised of loans to dealers, and the SPC’s liabilities of $ 1.31 billion and $ 1.35 billion, respectively, were primarily comprised of commercial paper.

The assets of the SPC are not available to pay Cat

5 unchanged sentences

We develop specific rates for each product shipment month and update them monthly based on actual warranty claim experience.

The reconciliation of the change in our product warranty liability balances for the six months ended June 30 was as follows:

Six Months Ended June 30,

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) 2024 2023

5 unchanged sentences

Computations of profit per share:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(Dollars in millions except per share data) 2024 2023 2024 2023

10 unchanged sentences

$ 5.06 $ 5.45 $ 16.27 $ 14.85

Shares outstanding as of June 30, (in millions) 484.9 510.1

Shares outstanding as of September 30, (in millions) 482.8 509.1

1 Profit attributable to common shareholders.

2 Diluted by assumed exercise of stock-based compensation awards using the treasury stock method.

For the three and six months ended June 30, 2024 and 2023, we excluded 0.3 million and 0.8 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 six months ended June 30, 2024, we repurchased 4.6 million and 15.9 million shares of Caterpillar common stock, respectively, at an aggregate cost of $ 1.6 billion and $ 5.3 billion, respectively.

For the three and six months ended June 30, 2023, we repurchased 5.9 million and 7.6 million shares of Caterpillar common stock, respectively, at an aggregate cost of $ 1.3 billion and $ 1.7 billion, respectively.

We made these purchases through the combination of accelerated stock repurchase (ASR) agreements with third-party financial institutions and open market transactions in 2024 and 2023.

For 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, 2023, we excluded 0.8 million and 2.1 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, 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.

For the three and nine months ended September 30, 2023, we repurchased 1.9 million and 9.5 million shares of Caterpillar common stock, respectively, at an aggregate cost of $ 0.5 billion and $ 2.2 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 2024 and 2023.

In the first quarter of 2024, we entered into ASR agreements to repurchase an aggregate of $ 3.50 billion of common stock.

2 unchanged sentences

We advanced the $ 1.00 billion and received approximately 2.2 million shares of Caterpillar common stock with a value of $ 750 million.

These ASR agreements may last into the fourth quarter of 2024.

These ASR agreements will last into the fourth quarter of 2024.

The final number of shares to ultimately be purchased 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.

3 unchanged sentences

Changes in the balances for each component of AOCI were as follows:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(Millions of dollars) 2024 2023 2024 2023

39 unchanged sentences

Ending balance $ ( 9 ) $ ( 126 ) $ ( 9 ) $ ( 126 )

Total AOCI Ending Balance at June 30,

Total AOCI Ending Balance at September 30,

$ ( 1,717 ) $ ( 2,232 ) $ ( 1,717 ) $ ( 2,232 )

18 unchanged sentences

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.

The effective tax rate for the three months ended June 30, 2024 of 23.9 percent was negatively impacted by losses for the divestiture of two non-U.S.

entities with no related tax benefit compared to 20.6 percent for the three months ended June 30, 2023 which included a benefit due to a change in a valuation allowance for certain deferred tax assets.

The effective tax rate for the six months ended June 30, 2024 was 21.7 percent compared to 23.2 percent for the six months ended June 30, 2023.

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.

The effective tax rate for the three months ended September 30, 2024 was 20.7 percent compared to 20.9 percent for the three months ended September 30, 2023.

The effective tax rate for the nine months ended September 30, 2024 was 21.4 percent compared to 22.4 percent for the nine months ended September 30, 2023.

Segment information

88 unchanged sentences

brand management and marketing strategy;

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.

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.

33 unchanged sentences

For example, we report certain costs on the cash basis for segment reporting and the accrual basis for consolidated external reporting.

For the three and six months ended June 30, 2024 and 2023, sales and revenues by geographic region reconciled to consolidated sales and revenues were as follows:

For the three and nine months ended September 30, 2024 and 2023, sales and revenues by geographic region reconciled to consolidated sales and revenues were as follows:

Sales and Revenues by Geographic Region

1 unchanged sentence

External Sales and Revenues Intersegment Sales and Revenues Total Sales and Revenues

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

Construction Industries $ 3,629 $ 658 $ 1,150 $ 875 $ 6,312 $ 33 $ 6,345

6 unchanged sentences

Total Sales and Revenues $ 8,545 $ 1,678 $ 3,199 $ 2,684 $ 16,106 $ — $ 16,106

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

Construction Industries $ 4,078 $ 555 $ 1,351 $ 997 $ 6,981 $ 18 $ 6,999

6 unchanged sentences

Total Sales and Revenues $ 8,927 $ 1,603 $ 3,402 $ 2,878 $ 16,810 $ — $ 16,810

1 Includes revenues from Construction Industries, Resource Industries, Energy & Transportation and All Other Segment of $ 180 million and $ 172 million in the three months ended June 30, 2024 and 2023, respectively.

1 Includes revenues from Construction Industries, Resource Industries, Energy & Transportation and All Other Segment of $ 190 million and $ 181 million in the three months ended September 30, 2024 and 2023, respectively.

Sales and Revenues by Geographic Region

1 unchanged sentence

External Sales and Revenues Intersegment Sales and Revenues Total Sales and Revenues

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

Construction Industries $ 11,419 $ 1,930 $ 3,193 $ 2,843 $ 19,385 $ 67 $ 19,452

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Total Sales and Revenues $ 26,161 $ 4,956 $ 9,048 $ 8,429 $ 48,594 $ — $ 48,594

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

Construction Industries $ 11,654 $ 1,720 $ 4,125 $ 3,307 $ 20,806 $ 93 $ 20,899

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Total Sales and Revenues $ 25,799 $ 4,784 $ 10,353 $ 9,054 $ 49,990 $ — $ 49,990

1 Includes revenues from Construction Industries, Resource Industries, Energy & Transportation and All Other Segment of $ 357 million and $ 334 million in the six months ended June 30, 2024 and 2023, respectively.

For the three and six months ended June 30, 2024 and 2023, Energy & Transportation segment sales by end user application were as follows:

1 Includes revenues from Construction Industries, Resource Industries, Energy & Transportation and All Other Segment of $ 547 million and $ 515 million in the nine months ended September 30, 2024 and 2023, respectively.

For the three and nine months ended September 30, 2024 and 2023, Energy & Transportation segment sales by end user application were as follows:

Energy & Transportation External Sales

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(Millions of dollars) 2024 2023 2024 2023

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Reconciliation of Consolidated profit before taxes:

(Millions of dollars) Three Months Ended June 30, Six Months Ended June 30,

(Millions of dollars) Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

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Total profit from reportable segments 3,784 3,961 12,083 11,856

Profit from All Other Segment 21 10 45 21

Profit (loss) from All Other Segment ( 13 ) 21 32 42

Cost centers ( 5 ) 10 7 53

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Reconciliation of Assets:

(Millions of dollars) June 30, 2024 December 31, 2023

(Millions of dollars) September 30, 2024 December 31, 2023

Assets from reportable segments:

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(Millions of dollars)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

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(Millions of dollars)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

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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 receivable portfolio was approximately 51 months with an average remaining term of approximately 27 months as of June 30, 2024.

The average original term of Cat Financial's customer finance receivable portfolio was approximately 51 months with an average remaining term of approximately 27 months as of September 30, 2024.

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.

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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 six months ended June 30, 2024, Cat Financial's forecasts reflected a continuation of the trend of historically low unemployment rates as well as low delinquencies within their portfolio.

During the three and nine months ended September 30, 2024, Cat Financial's forecasts reflected a continuation of the trend of historically low unemployment rates as well as low delinquencies within their portfolio.

However, industry delinquencies show an increasing trend as the central bank actions aimed at reducing inflation have weakened global economic growth.

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Cat Financial's wholesale financing plans provide assistance to dealers by financing their mostly new Caterpillar equipment inventory and rental fleets on a secured and unsecured basis.

In addition, Cat Financial provides a variety of secured and

unsecured loans to Caterpillar dealers.

In addition, Cat Financial provides a variety of secured and unsecured loans to Caterpillar dealers.

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 six months ended June 30, 2024.

Therefore, Cat Financial made no adjustments to historical loss rates during the three and nine months ended September 30, 2024.

Classes of finance receivables

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An analysis of Cat Financial's allowance for credit losses was as follows:

(Millions of dollars) Three Months Ended June 30, 2024 Three Months Ended June 30, 2023

(Millions of dollars) Three Months Ended September 30, 2024 Three Months Ended September 30, 2023

Customer Dealer Total Customer Dealer Total

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Ending balance $ 246 $ 4 $ 250 $ 284 $ 51 $ 335

Six Months Ended June 30, 2024 Six Months Ended June 30, 2023

Nine Months Ended September 30, 2024 Nine Months Ended September 30, 2023

Customer Dealer Total Customer Dealer Total

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Gross write-offs by origination year for Cat Financial's Customer portfolio segment were as follows:

(Millions of dollars) Three Months Ended June 30, 2024

(Millions of dollars) Three Months Ended September 30, 2024

2024 2023 2022 2021 2020 Prior Revolving

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Asia/Pacific — 2 1 — — 1 — 4

Mining 8 3 3 — — — — 14

Latin America — 2 2 1 2 — — 7

Total $ 8 $ 12 $ 11 $ 4 $ 4 $ 1 $ 2 $ 42

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

2023 2022 2021 2020 2019 Prior Revolving

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Total $ 1 $ 6 $ 7 $ 4 $ 1 $ 1 $ 2 $ 22

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

2024 2023 2022 2021 2020 Prior Revolving

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Asia/Pacific — 4 4 3 1 1 — 13

Mining 8 3 3 — — — — 14

Latin America — 2 5 4 3 8 — 22

Total $ 8 $ 24 $ 25 $ 15 $ 8 $ 10 $ 8 $ 98

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

2023 2022 2021 2020 2019 Prior Revolving

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Total $ 1 $ 15 $ 19 $ 12 $ 4 $ 3 $ 9 $ 63

For the three months ended June 30, 2024, there were no gross write-offs in Cat Financial's Dealer portfolio segment.

For the six months ended June 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 2019.

For the three months ended September 30, 2024, 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 2019.

Credit quality of finance receivables

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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) June 30, 2024

(Millions of dollars) September 30, 2024

2024 2023 2022 2021 2020 Prior Revolving

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For those contracts where the borrower is experiencing financial difficulty, repayment of the outstanding amounts is generally expected to be provided through the operation or repossession and sale of the equipment.

As of June 30, 2024, Cat Financial's total amortized cost of finance receivables within the Dealer portfolio segment was current.

As of September 30, 2024, Cat Financial's total amortized cost of finance receivables within the Dealer portfolio segment was current.

As of December 31, 2023, Cat Financial's total amortized cost of finance receivables within the Dealer portfolio segment was current, with the exception of $ 44 million that was 91+ days past due in Latin America, all of which originated prior to 2019.

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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) June 30, 2024 December 31, 2023

(Millions of dollars) September 30, 2024 December 31, 2023

Amortized Cost Amortized Cost

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Total $ 206 $ 22 $ 152 $ 44

There were no finance receivables in Cat Financial's Dealer portfolio segment on non-accrual status as of June 30, 2024.

There were no finance receivables in Cat Financial's Dealer portfolio segment on non-accrual status as of September 30, 2024.

There were $ 44 million in finance receivables in Cat Financial's Dealer portfolio segment on non-accrual status as of December 31, 2023, all of which was in Latin America.

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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 six months ended June 30, 2024 and 2023, there were no finance receivable modifications granted to borrowers experiencing financial difficulty in Cat Financial's Dealer portfolio segment.

The amortized cost basis of finance receivables modified for borrowers experiencing financial difficulty in the Customer portfolio segment during the three months ended June 30, 2024 and 2023, was $ 3 million and $ 22 million, respectively.

Total modifications with borrowers experiencing financial difficulty represented 0.02 percent and 0.10 percent of Cat Financial's finance receivable portfolio for the same periods, respectively.

The amortized cost basis of finance receivables modified for borrowers experiencing financial difficulty in the Customer portfolio segment during the six

months ended June 30, 2024 and 2023, was $ 6 million and $ 30 million, respectively.

Total modifications with borrowers experiencing financial difficulty represented 0.03 percent and 0.14 percent of Cat Financial's finance receivable portfolio for the same periods, respectively.

Fo r the three months ende d June 30, 2024 and 2023, the financial effects of term extensions for borrowers experiencing financial difficulty added a weighted average of 13 and 18 months, respectively, to the terms of modified contracts.

For the six months ended June 30, 2024 and 2023, the financial effects of term extensions for borrowers experiencing financial difficulty added a weighted average o f 11 and 21 months, res pectively, to the terms of modified contracts.

For t he three months en ded June 30, 2024 and 2023, the financial effects of payment delays for borrowers experiencing financial difficulty resulted in weighted average paymen t deferrals and/or interest only payment periods of 6 and 7 months, respectively.

For the six months e nded June 30, 2024 and 2023, the financial effects of payment delays for borrowers experiencing financial difficulty resulted in weighted average paymen t deferrals and/or interest only payment periods of 8 months.

During the three and nine months ended September 30, 2024 and 2023, there were no finance receivable modifications granted to borrowers experiencing financial difficulty in Cat Financial's Dealer portfolio segment.

The amortized cost basis of finance receivables modified for borrowers experiencing financial difficulty in the Customer portfolio segment during the three months ended September 30, 2024 and 2023, was $ 6 million and $ 13 million, respectively.

Total modifications with borrowers experiencing financial difficulty represented 0.03 percent and 0.06 percent of Cat Financial's Customer portfolio for the same periods, respectively.

The amortized cost basis of finance receivables modified for borrowers experiencing financial difficulty in the Customer portfolio segment during the nine months

ended September 30, 2024 and 2023, was $ 12 million and $ 38 million, respectively.

Total modifications with borrowers experiencing financial difficulty represented 0.05 percent and 0.17 percent of Cat Financial's Customer portfolio for the same periods, respectively.

Fo r the three months ende d September 30, 2024 and 2023, the financial effects of term extensions for borrowers experiencing financial difficulty added a weighted average of 5 and 8 months, respectively, to the terms of modified contracts.

For the nine months ended September 30, 2024 and 2023, the financial effects of term extensions for borrowers experiencing financial difficulty added a weighted average o f 8 and 17 months, res pectively, to the terms of modified contracts.

For t he three months en ded September 30, 2024 and 2023, the financial effects of payment delays for borrowers experiencing financial difficulty resulted in weighted average paymen t deferrals and/or interest only payment periods of 4 and 6 months, respectively.

For the nine months e nded September 30, 2024 and 2023, the financial effects of payment delays for borrowers experiencing financial difficulty resulted in weighted average paymen t deferrals and/or interest only payment periods of 6 and 7 months, respectively.

After Cat Financial modifies a finance receivable, they continue to track its performance under its most recent modified terms.

As of June 30, 2024 and 2023, defaults of loans modified in the prior twelve months were not significant.

As of September 30, 2024 and 2023, defaults of loans modified in the prior twelve months were not significant.

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;

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See Note 5 for additional information.

Assets and liabilities measured on a recurring basis at fair value included in our Consolidated Statement of Financial Position as of June 30, 2024 and December 31, 2023 were as follows:

June 30, 2024

Assets and liabilities measured on a recurring basis at fair value included in our Consolidated Statement of Financial Position as of September 30, 2024 and December 31, 2023 were as follows:

September 30, 2024

(Millions of dollars)

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In determining collateral value, Cat Financial estimates the current fair market value of the collateral less selling costs.

Cat Financial had loans carried at fair value of $ 51 million and $ 55 million as of June 30, 2024 and December 31, 2023, respectively.

Cat Financial had loans carried at fair value of $ 59 million and $ 55 million as of September 30, 2024 and December 31, 2023, respectively.

Fair values of financial instruments

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Our financial instruments not carried at fair value were as follows:

June 30, 2024 December 31, 2023

September 30, 2024 December 31, 2023

(Millions of dollars) Carrying

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Financial Products 25,496 25,472 23,612 23,299 2

1 Represents finance leases and failed sale leasebacks of $ 6,720 million and $ 6,953 million at June 30, 2024 and December 31, 2023, respectively.

1 Represents finance leases and failed sale leasebacks of $ 7,018 million and $ 6,953 million at September 30, 2024 and December 31, 2023, respectively.

Other income (expense)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

(Millions of dollars) 2024 2023 2024 2023

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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 six months ended June 30, 2024 and 2023 were as follows:

(Millions of dollars) Three Months Ended June 30, Six Months Ended June 30,

Restructuring costs for the three and nine months ended September 30, 2024 and 2023 were as follows:

(Millions of dollars) Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

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Divestitures 1

228 — 164 586

Contract terminations 1

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1 Recognized in Other operating (income) expenses.

2 Represents costs related to our restructuring programs, primarily for project management, inventory write-downs, equipment relocation and accelerated depreciation, all of which are primarily included in Cost of goods sold.

The restructuring costs for the six months ended June 30, 2024 were primarily related to the divestitures of certain non-US entities.

The restructuring costs for the six months ended June 30, 2023 were primarily related to the divestiture of the company's Longwall business within Resource Industries.

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, 2024 were primarily related to the divestitures of certain non-US entities.

The restructuring costs for the nine months ended September 30, 2023 were primarily related to the divestiture of the company's Longwall business within Resource Industries.

The divestiture closed on February 1, 2023 and resulted in a pre-tax loss of approximately $ 586 million, primarily a non-cash item driven by the release of $ 494 million of accumulated foreign currency translation.

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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 $ 819 million and $ 803 million at June 30, 2024 and December 31, 2023, respectively.

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 $ 818 million and $ 803 million at September 30, 2024 and December 31, 2023, respectively.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements