What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-05-07 compared with 2024-11-06 · 222 added, 508 removed, 645 unchanged (53% of the section changed)

5 unchanged sentences

Risk Factors of the 2024 Form 10-K .

Highlights for the third quarter of 2024 include:

• Total sales and revenues for the third quarter of 2024 were $16.106 billion, a decrease of $704 million, or 4 percent, compared with $16.810 billion in the third quarter of 2023.

In the three primary segments, sales were lower in Construction Industries and Resource Industries and higher in Energy & Transportation .

• Operating profit margin was 19.5 percent for the third quarter of 2024, compared with 20.5 percent for the third quarter of 2023.

Adjusted operating profit margin was 20.0 percent for the third quarter of 2024, compared with 20.8 percent for the third quarter of 2023.

• Third-quarter 2024 profit per share was $5.06, and excluding the items in the table below, adjusted profit per share was $5.17.

Third-quarter 2023 profit per share was $5.45, and excluding the items in the table below, adjusted profit per share was $5.52.

• Caterpillar ended the third quarter of 2024 with $5.6 billion of enterprise cash.

Highlights for the nine months ended September 30, 2024 include:

• Total sales and revenues were $48.594 billion for the nine months ended September 30, 2024, a decrease of $1.396 billion, or 3 percent, compared with $49.990 billion for the nine months ended September 30, 2023.

• Operating profit margin was 20.9 percent for the nine months ended September 30, 2024, compared with 19.7 percent for the nine months ended September 30, 2023.

Adjusted operating profit margin was 21.5 percent for the nine months ended September 30, 2024, compared with 21.0 percent for the nine months ended September 30, 2023.

• 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.

Profit per share for the nine months ended September 30, 2023, was $14.85, and excluding the items in the table below, adjusted profit per share was $15.98.

• Enterprise operating cash flow was $8.6 billion for the nine months ended September 30, 2024.

• In order for our results to be more meaningful to our readers, we have separately quantified the impact of several significant items.

A detailed reconciliation of GAAP to non-GAAP financial measures is included on pages 66-68.

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

Highlights for the first quarter of 2025 include:

• Total sales and revenues for the first quarter of 2025 were $14.249 billion, a decrease of $1.550 billion, or 10 percent, compared with $15.799 billion in the first quarter of 2024.

Sales were lower across the three primary segments.

• Operating profit margin was 18.1 percent for the first quarter of 2025, compared with 22.3 percent for the first quarter of 2024.

Adjusted operating profit margin was 18.3 percent for the first quarter of 2025, compared with 22.2 percent for the first quarter of 2024.

• First-quarter 2025 profit per share was $4.20, and excluding the items in the table below, adjusted profit per share was $4.25.

First-quarter 2024 profit per share was $5.75, and excluding the items in the table below, adjusted profit per share was $5.60.

• Caterpillar ended the first quarter of 2025 with $3.6 billion of enterprise cash.

In order for our results to be more meaningful to our readers, we have separately quantified the impact of significant items.

Three Months Ended March 31, 2025 Three Months Ended March 31, 2024

(Dollars in millions except per share data) Profit Before Taxes Profit

Per Share Profit Before Taxes Profit

Profit $ 2,570 $ 4.20 $ 3,532 $ 5.75

Restructuring (income) costs - divestitures of certain non-U.S.

— — — — 164 0.22 — —

Other restructuring (income) costs 33 0.05 58 0.09

Restructuring costs - Longwall divestiture

— — — — — — 586 1.13

Deferred tax valuation allowance adjustments — — — — — — — (0.17)

Restructuring (income) - non-U.S.

mining entity divestiture — — (64) (0.24)

Adjusted profit $ 2,603 $ 4.25 $ 3,526 $ 5.60

Total sales and revenues for the third quarter of 2024 were $16.106 billion, a decrease of $704 million, or 4 percent, compared with $16.810 billion in the third quarter of 2023.

The decrease was primarily due to lower sales volume .

The decrease in sales volume was mainly driven by lower sales of equipment to end users.

In addition, changes in dealer inventories had an unfavorable impact to sales volume.

Dealer inventory increased less during the third quarter of 2024 than during the third quarter of 2023.

Third-quarter 2024 profit per share was $5.06, compared with $5.45 profit per share in the third quarter of 2023.

In the third quarters of 2024 and 2023, profit per share included restructuring costs.

Profit for the third quarter of 2024 was $2.464 billion, a decrease of $330 million, or 12 percent, compared with $2.794 billion for the third quarter of 2023.

The decrease was mainly due to the profit impact of lower sales volume, partially offset by favorable price realization .

A detailed reconciliation of GAAP to non-GAAP financial measures is included on pages 57-59.

Total sales and revenues for the first quarter of 2025 were $14.249 billion, a decrease of $1.550 billion, or 10 percent, compared with $15.799 billion in the first quarter of 2024.

The decrease was primarily due to lower sales volume and unfavorable price realization .

Lower sales volume was mainly driven by the impact from changes in dealer inventories .

First-quarter 2025 profit per share was $4.20, compared with $5.75 profit per share in the first quarter of 2024.

In the first quarter of 2025 and 2024, profit per share included restructuring income/costs .

Profit for the first quarter of 2025 was $2.003 billion, a decrease of $853 million, or 30 percent, compared with $2.856 billion for the first quarter of 2024.

The decrease was mainly due to the profit impact of lower sales volume and unfavorable price realization.

Trends and Economic Conditions

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Our results continue to reflect the benefit of the diversity of our end markets.

In Construction Industries, we expect lower sales of equipment to end users in the fourth quarter of 2024 as compared to the fourth quarter of 2023, but remain positive about the longer-term demand outlook.

In North America, we anticipate lower sales of equipment to end users in the fourth quarter of 2024 primarily due to lower rental fleet loading, consistent with the trend in the second and third quarters of 2024.

However, dealer rental revenue continues to grow.

In addition, government-related infrastructure projects are expected to remain healthy, supported by funding yet to be spent from the Infrastructure Investment and Jobs Act (IIJA).

In Asia Pacific , outside of China, we expect soft economic conditions to continue.

We anticipate demand in China will remain at a relatively low level in the excavator industry above 10-tons.

In EAME , we anticipate that weak economic conditions in Europe will continue, to be partially offset by continued healthy construction demand in the Middle East.

Construction activity in Latin America remains healthy, and we are expecting modest growth to continue.

In addition, we anticipate the ongoing benefit of our services initiatives will positively impact Construction Industries.

In Resource Industries, for both mining and heavy construction and quarry and aggregates, we continue to anticipate lower machine sales volume in the fourth quarter of 2024 as compared to a strong performance in the fourth quarter of 2023.

However, we expect the year-over-year rate of decline for sales of equipment to end users to moderate in the fourth quarter of 2024 as compared to previous quarters.

We expect higher services revenues, including robust rebuild activity.

Customer product utilization remains high, the number of parked trucks remains relatively low, the age of the fleet remains elevated, and our autonomous solutions continue to have strong customer acceptance.

Customers continue to display capital discipline, however, we continue to believe the energy transition will support increased commodity demand over time, expanding our total addressable market and providing further opportunities for long-term profitable growth.

In Energy & Transportation, Power Generation demand is expected to remain strong, and we expect robust growth for reciprocating engines and for turbines and turbine-related services in the fourth quarter of 2024 and for the full-year as compared to 2023.

Overall strength in Power Generation continues to be driven by data center growth related to cloud computing and generative artificial intelligence (AI), and we expect this trend to continue.

For Oil & Gas, in total, we expect a stronger year overall in 2024 as compared to 2023.

For turbines and turbine-related services used in Oil & Gas applications, we expect a strong fourth quarter of 2024, but sales are expected to be lower than the fourth quarter of 2023 due to the timing of deliveries.

We expect the increase in sales for turbines and turbine-related services used in Power Generation will mostly offset the decrease in sales for turbines and turbine-related services used in Oil & Gas.

Overall, we expect roughly flat sales in turbines and turbine-related services in the fourth quarter of 2024 as compared to the fourth quarter of 2023.

Turbines and turbine-related services has a strong backlog as well as healthy order and inquiry activity, and we continue to expect growth for turbines and turbine-related services in Oil & Gas in 2024 as compared to 2023.

After a strong 2023, we expect reciprocating engine sales for Oil & Gas to be slightly down in 2024, primarily due to ongoing softness in well servicing.

We still expect gas compression for reciprocating engines used in Oil & Gas to be up in 2024 as compared to 2023, however, we expect it to soften in the near-term as equipment lead times have normalized.

Industrial demand is expected to remain at a relatively low level in 2024 as compared to 2023.

In Transportation, we anticipate growth in 2024 for both rail services and marine applications.

Fourth-Quarter 2024 Company Trends and Expectations

In the fourth quarter of 2024, we expect slightly lower total sales and revenues as compared to the fourth quarter of 2023, impacted by lower machine sales of equipment to end users.

Machine dealer inventory is expected to decrease less during the fourth quarter of 2024 as compared to the $1.4 billion decrease during the fourth quarter of 2023.

We expect machine dealer inventory at the end of 2024 to be around the same level as the end of 2023.

Price realization for machines is expected to trend lower with the normalizing pricing environment, partially offset by favorable price realization in Energy & Transportation.

Services revenues increased in the third quarter of 2024, and the ongoing benefit of our services initiatives are expected to positively impact sales in the fourth quarter of 2024.

In the fourth quarter of 2024 as compared to the fourth quarter of 2023, we expect favorable manufacturing costs and lower selling, general and administrative (SG&A) and research and development (R&D) expenses to be more than offset by the profit impact of lower sales volume.

Lower SG&A/R&D expenses are expected to be primarily driven by lower short-term incentive compensation in the fourth quarter of 2024 as compared to the fourth quarter of 2023.

For the three primary segments, as compared to the fourth quarter of 2023, we expect lower Construction Industries' sales in the fourth quarter of 2024 driven by lower sales of equipment to end users and unfavorable price realization.

Resource Industries' sales in the fourth quarter of 2024 are expected to be slightly lower driven by lower sales of equipment to end users as compared to a strong fourth quarter of 2023.

In Energy & Transportation, we expect sales to be slightly higher supported by strength in Power Generation.

In the fourth quarter of 2024 as compared to the fourth quarter of 2023, within Construction Industries, we expect unfavorable price realization, partially offset by favorable manufacturing costs.

In Resource Industries, we anticipate an unfavorable profit impact from lower sales volume and higher SG&A/R&D expenses as we continue to invest in strategic initiatives for future long-term profitable growth, such as services growth and technology, including autonomy, alternative fuels, connectivity and digital and electrification, to be partially offset by favorable manufacturing costs.

In Energy & Transportation, we expect favorable price realization.

In Construction Industries , we are encouraged by another quarter of better-than-expected sales of equipment to end users and strong order rates across many of our regions as customers are responding to the attractiveness of our sales merchandising programs.

Construction spend in North America remains at healthy levels, and infrastructure projects funded by the Infrastructure Investment and Jobs Act (IIJA) continue to be awarded.

In Asia Pacific, outside of China, economic conditions continue to be soft.

China has shown positive momentum in the excavator industry above 10-tons, but from a very low level of activity.

In EAME , weak economic conditions in Europe remain, while conditions are supportive of investment in Africa and the Middle East.

Construction activity in Latin America is expected to moderately decline in 2025 as compared to 2024.

In Resource Industries , we are starting the year with strong order rates and backlog growth, particularly for large mining trucks.

Rebuild activity is expected to remain healthy.

Although most key commodities remain above investment thresholds, customers continue to display capital discipline.

Customer product utilization remains high, the age of the fleet remains

elevated, and we continue to see growing customer acceptance of our autonomous solutions.

We believe the evolving energy landscape will support increased commodity demand over time, providing further opportunities for long-term profitable growth.

In Energy & Transportation , the growth in backlog was driven by robust order activity in both Oil and Gas and Power Generation.

Demand remains strong in Power Generation for both reciprocating engines and turbines and turbine-related services in 2025.

The strength of our backlog gives us confidence in our long-term outlook.

For Oil and Gas reciprocating engines and services, we expect continuing softness in well servicing due to ongoing capital discipline by our customers, industry consolidation and efficiency improvements in our customers’ operations.

Also within Oil and Gas reciprocating engines and services, we see positive momentum in gas compression.

For turbines and turbine-related services used in Oil and Gas applications, backlog remains strong, and we continue to see healthy orders.

Demand for products in Industrial applications is expected to remain at a relatively low level.

Transportation is expected to remain stable.

Full-Year 2025 Company Trends and Expectations

For 2024, we expect continued services growth.

We also expect restructuring costs to be approximately $400 million and expect capital expenditures to be around $2.0 billion.

We expect the annual effective tax rate, excluding discrete items, to be 22.5 percent.

We are closely monitoring the evolving economic conditions.

Due to the tariff announcements and increasing economic uncertainty, we have evaluated a variety of scenarios to estimate the potential impact of tariffs on our results for the remainder of the year.

Demand signals were stronger than we expected in the first quarter of 2025, including backlog growth across our three primary segments and stronger than expected sales of equipment to end users in Construction Industries and Resource Industries.

These indicators boost our confidence in the resilience of our sales and revenues this year.

For the full-year 2025, in a pre-tariff scenario, which does not include any impact from tariffs, we expect sales and revenues to be about flat compared to 2024.

In our alternative scenario, which assumes negative economic growth in the second half of 2025, we expect full-year sales and revenues to only be down slightly in 2025 as compared to 2024.

This expectation is a reflection of the diversity of our end markets and the strength of our record backlog, especially for large reciprocating engines and for turbines and turbine-related services.

We expect the year over year impact of unfavorable price realization to be greater in the first and second quarters of 2025 and expect it to moderate in the second half of 2025.

In addition, we also do not expect a significant decrease in machine dealer inventory as we saw in the fourth quarter of 2024, and we still expect dealers to hold inventories about flat for the full year.

We have assessed potential cost impacts from the current tariffs which have been announced and implemented for the full-year 2025 before any additional mitigation actions;

however, given the uncertainty of what the tariff rates could be and the timing of any additional mitigation actions, it is not possible to derive an accurate estimate of the net full-year 2025 impact of tariffs.

In 2025, we continue to expect restructuring costs of approximately $150 million to $200 million and expect capital expenditures of about $2.5 billion.

We anticipate the annual effective tax rate, excluding discrete items, to be 23.0 percent in 2025.

Second-Quarter 2025 Company Trends and Expectations

In the second quarter of 2025, we expect sales and revenues to be similar to the second quarter of 2024.

Sales growth in Energy & Transportation is expected to be offset by lower sales in Construction Industries and Resource Industries, primarily driven by unfavorable price realization.

Machine sales volume is expected to be about flat.

In the second quarter of 2025 as compared to the second quarter of 2024, we anticipate lower sales in Construction Industries primarily due to unfavorable price realization, partially offset by slightly higher sales volume.

In Resource Industries, we expect lower sales primarily due to unfavorable price realization and slightly lower sales volume.

In Energy & Transportation, we anticipate higher sales in the second quarter of 2025 as compared to the second quarter of 2024, primarily driven by strength in Power Generation and Oil and Gas.

The strength in Oil and Gas is driven by turbines and turbine-related services.

We expect favorable price realization for Energy & Transportation in the second quarter of 2025.

In the second quarter of 2025 as compared to the second quarter of 2024, we expect unfavorable price realization, unfavorable manufacturing costs and higher selling, general and administrative (SG&A) and research and development (R&D) expenses.

We anticipate $250 million to $350 million of estimated cost in the second quarter of 2025 related to the tariffs which have been announced and implemented in 2025.

This estimate is net of initial mitigation efforts and cost controls which represent limited, short-term actions that we were able to implement quickly.

In Construction Industries, we expect unfavorable price realization in the second quarter of 2025 as compared to the second quarter of 2024.

We expect about 50 percent of the $250 million to $350 million of estimated cost related to tariffs to be incurred in Construction Industries.

In Resource Industries, we expect unfavorable price realization and higher SG&A/R&D expenses in the second quarter of 2025 as compared to the second quarter of 2024.

We expect about 25 percent of the $250

million to $350 million of estimated cost related to tariffs to be incurred in Resource Industries.

In Energy & Transportation, we expect the profit impact of higher sales volume and favorable price realization to be partially offset by unfavorable manufacturing costs and higher SG&A/R&D expenses.

We expect about 25 percent of the $250 million to $350 million of estimated cost related to tariffs to be incurred in Energy & Transportation.

Global Business Conditions

We continue to monitor a variety of external factors around the world, such as supply chain disruptions, inflationary cost and labor pressures.

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.

8 unchanged sentences

Consolidated Results of Operations

THREE MONTHS ENDED SEPTEMBER 30, 2024 COMPARED WITH THREE MONTHS ENDED SEPTEMBER 30, 2023

THREE MONTHS ENDED MARCH 31, 2025 COMPARED WITH THREE MONTHS ENDED MARCH 31, 2024

CONSOLIDATED SALES AND REVENUES

The chart above graphically illustrates reasons for the change in consolidated sales and revenues between the third quarter of 2023 (at left) and the third quarter of 2024 (at right).

The chart above graphically illustrates reasons for the change in consolidated sales and revenues between the first quarter of 2024 (at left) and the first 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 2024 were $16.106 billion, a decrease of $704 million, or 4 percent, compared with $16.810 billion in the third quarter of 2023.

The decrease was primarily due to lower sales volume of $759 million.

The decrease in sales volume was mainly driven by lower sales of equipment to end users.

In addition, changes in dealer inventorie s had an unfavorable impact to sales volume.

Dealer inventory increased less during the third quarter of 2024 than during the third quarter of 2023.

In the three primary segments, sales were lower in Construction Industries and Resource Industries and higher in Energy & Transportation.

North America sales decreased 5 percent primarily due to lower sales volume, partially offset by favorable price realization.

The decrease in sales volume was primarily driven by lower sales of equipment to end users and the impact from changes in dealer inventories.

Dealer inventory increased less during the third quarter of 2024 than during the third quarter of 2023.

Sales increased 6 percent in Latin America mainly due to higher sales volume, partially offset by unfavorable currency impacts, primarily related to the Brazilian real.

The increase in sales volume was primarily driven by the impact from changes in dealer inventories.

Dealer inventory increased during the third quarter of 2024, compared with a decrease during the third quarter of 2023.

EAME sales decreased 6 percent primarily due to lower sales volume.

Total sales and revenues for the first quarter of 2025 were $14.249 billion, a decrease of $1.550 billion, or 10 percent, compared with $15.799 billion in the first quarter of 2024.

The decrease was primarily due to lower sales volume of $1.1 billion and unfavorable price realization of $250 million.

Lower sales volume was mainly driven by the impact from changes in dealer inventories.

Dealer inventory increased by $100 million during the first quarter of 2025, compared with an increase of $1.4 billion during the first quarter of 2024.

Sales were lower across the three primary segments.

North America sales decreased 11 percent primarily due to lower sales volume.

The decrease in sales volume was primarily driven by the impact from changes in dealer inventories.

Dealer inventory increased less during the first quarter of 2025 than during the first quarter of 2024.

Sales decreased 3 percent in Latin America mainly due to unfavorable currency impacts primarily related to the Brazilian real, partially offset by higher sales volume.

The increase in sales volume was primarily driven by higher sales of equipment to end users.

EAME sales decreased 13 percent primarily due to lower sales volume and unfavorable price realization.

The decrease in sales volume was primarily driven by the impact from changes in dealer inventories.

Dealer inventory decreased during the first quarter of 2025, compared with an increase during the first quarter of 2024.

Asia/Pacific sales decreased 12 percent mainly due to lower sales volume and unfavorable currency impacts primarily related to the Australian dollar.

The decrease in sales volume was primarily driven by lower sales of equipment to end users.

Asia/Pacific sales decreased 7 percent due to lower sales volume.

The decrease in sales volume was mainly driven by the impact from changes in dealer inventories.

Dealer inventory decreased during the third quarter of 2024, compared with an increase during the third quarter of 2023.

Total dealer inventory increased $400 million during the third quarter of 2024, compared with an increase of $600 million during the third quarter of 2023.

Total dealer inventory increased $100 million during the first quarter of 2025, compared with an increase of $1.4 billion during the first quarter of 2024.

Machine dealer inventory was about flat during the first quarter of 2025, compared with an increase of $1.1 billion during the first 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.

2 unchanged sentences

Sales and Revenues by Segment

(Millions of dollars) Third Quarter 2023 Sales

Realization Currency Inter-Segment / Other Third Quarter 2024 $

(Millions of dollars) First Quarter 2024 Sales

Realization Currency Inter-Segment / Other First Quarter 2025 $

Construction Industries $ 6,424 $ (820) $ (355) $ (98) $ 33 $ 5,184 $ (1,240) (19 %)

13 unchanged sentences

(Millions of dollars) $ % Chg $ % Chg $ % Chg $ % Chg $ % Chg $ % Chg $ % Chg

Third Quarter 2024

First Quarter 2025

Construction Industries $ 2,904 (24 %) $ 504 (15 %) $ 867 (13 %) $ 869 (12 %) $ 5,144 (20 %) $ 40 471 % $ 5,184 (19 %)

9 unchanged sentences

Consolidated Sales and Revenues $ 7,738 (10 %) $ 1,515 (3 %) $ 2,506 (12 %) $ 2,490 (12 %) $ 14,249 (10 %) $ — — % $ 14,249 (10 %)

Third Quarter 2023

First Quarter 2024

Construction Industries $ 3,833 $ 595 $ 996 $ 993 $ 6,417 $ 7 $ 6,424

8 unchanged sentences

Consolidated Sales and Revenues $ 8,573 $ 1,559 $ 2,852 $ 2,815 $ 15,799 $ — $ 15,799

1 Includes revenues from Machinery, Energy & Transportation o f $190 m illion and $181 million in the third quarter of 2024 and 2023, respectively.

1 Includes revenues from Machinery, Energy & Transportation o f $163 m illion and $177 million in the first quarter of 2025 and 2024, respectively.

CONSOLIDATED OPERATING PROFIT

The chart above graphically illustrates reasons for the change in consolidated operating profit between the third quarter of 2023 (at left) and the third quarter of 2024 (at right).

The chart above graphically illustrates reasons for the change in consolidated operating profit between the first quarter of 2024 (at left) and the first 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's other operating (income) expenses.

Operating profit for the third quarter of 2024 was $3.147 billion, a decrease of $302 million, or 9 percent, compared with $3.449 billion in the third quarter of 2023.

The decrease was mainly due to the profit impact of lower sales volume of $372 million, partially offset by favorable price realization of $104 million.

Operating profit margin was 19.5 percent for the third quarter of 2024, compared with 20.5 percent for the third quarter of 2023.

Operating profit for the first quarter of 2025 was $2.579 billion, a decrease of $940 million, or 27 percent, compared with $3.519 billion in the first quarter of 2024.

The decrease was mainly due to the profit impact of lower sales volume of $652 million and unfavorable price realization of $250 million.

Operating profit margin was 18.1 percent for the first quarter of 2025, compared with 22.3 percent for the first quarter of 2024.

Profit (Loss) by Segment

(Millions of dollars) Third Quarter 2024 Third Quarter 2023 $

(Millions of dollars) First Quarter 2025 First Quarter 2024 $

Construction Industries $ 1,024 $ 1,764 $ (740) (42 %)

10 unchanged sentences

Other Profit/Loss and Tax Items

▪ Interest expense excluding Financial Products in the third quarter of 2024 was $125 million, compared with $129 million in the third quarter of 2023.

The decrease was due to lower average debt outstanding, partially offset by higher average borrowing rates.

▪ Other income (expense) in the third quarter of 2024 was income of $76 million, compared with income of $195 million in the third quarter of 2023.

▪ Interest expense excluding Financial Products in the first quarter of 2025 was $116 million, compared with $143 million in the first quarter of 2024.

The decrease was due to lower average debt outstanding and lower average borrowing rates.

▪ Other income (expense) in the first quarter of 2025 was income of $107 million, compared with income of $156 million in the first quarter of 2024.

The change was primarily driven by unfavorable foreign currency impacts.

▪ The effective tax rate for the third quarter of 2024 was 20.7 percent compared to 20.9 percent for the third quarter of 2023.

Excluding the discrete items discussed below, the estimated annual tax rate was 22.5 percent for the third quarters of 2024 and 2023.

In the third quarter of 2024, the company recorded discrete tax benefits of $47 million to reflect changes in estimates related to prior years.

In addition, a discrete tax benefit of $7 million was recorded in the third quarter of 2024, compared with a $22 million benefit in the third quarter of 2023, for the settlement of stock-based compensation awards with associated tax deductions in excess of cumulative U.S.

▪ The effective tax rate for the first quarter of 2025 was 22.3 percent compared to 19.5 percent for the first quarter of 2024.

Excluding the discrete items discussed below, the first-quarter 2025 estimated annual effective tax rate was 23.0 percent compared with 22.5 percent for the first quarter of 2024.

A discrete tax benefit of $17 million was recorded in the first quarter of 2025, compared with a $38 million benefit in the first quarter of 2024, for the settlement of stock-based compensation awards with associated tax deductions in excess of cumulative U.S.

GAAP compensation expense.

The company also recorded a $34 million benefit in the third quarter of 2023 due to a decrease from the second-quarter estimated annual tax rate.

In addition, the estimated annual effective tax rate in the first quarter of 2024 excluded the impact of nontaxable gains of $64 million for the divestiture of a non-U.S.

mining entity along with a related tax benefit of $54 million.

Please see a reconciliation of GAAP to non-GAAP financial measures on pages 57-59.

Construction Industries

Construction Industries’ total sales were $6.345 billion in the third quarter of 2024, a decrease of $654 million, or 9 percent, compared with $6.999 billion in the third quarter of 2023.

Construction Industries’ total sales were $5.184 billion in the first quarter of 2025, a decrease of $1.240 billion, or 19 percent, compared with $6.424 billion in the first quarter of 2024.

The decrease was primarily due to lower sales volume of $820 million and unfavorable price realization of $355 million.

The decrease in sales volume was mainly driven by lower sales of equipment to end users.

• In North America, sales decreased primarily due to lower sales volume.

Lower sales volume was mainly driven by lower sales of equipment to end users and the impact from changes in dealer inventories.

Dealer inventory increased less during the third quarter of 2024 than during the third quarter of 2023.

• Sales increased in Latin America mainly due to higher sales volume, partially offset by unfavorable currency impacts, primarily related to the Brazilian real, and unfavorable price realization.

Higher sales volume was mainly driven by the impact from changes in dealer inventories.

Dealer inventory increased during the third quarter of 2024, compared with a decrease during the third quarter of 2023.

• In EAME, sales decreased primarily due to lower sales volume.

Lower sales volume was mainly driven by lower sales of equipment to end users.

• Sales decreased in Asia/Pacific mainly due to lower sales volume and unfavorable currency impacts primarily related to the Japanese yen.

The decrease in sales volume was mainly driven by the impact from changes in dealer inventories.

Dealer inventory decreased slightly during the first quarter of 2025, compared with an increase during the first quarter of 2024.

• In North America, sales decreased due to lower sales volume and unfavorable price realization.

Lower sales volume was mainly driven by the impact from changes in dealer inventories.

Dealer inventory decreased during the third quarter of 2024, compared with an increase during the third quarter of 2023.

Construction Industries’ segment profit was $1.486 billion in the third quarter of 2024, a decrease of $361 million, or 20 percent, compared with $1.847 billion in the third quarter of 2023.

Dealer inventory decreased during the first quarter of 2025, compared with an increase during the first quarter of 2024.

• Sales decreased in Latin America due to unfavorable currency impacts primarily related to the Brazilian real, 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 first quarter of 2025, compared with an increase during the first quarter of 2024.

• In EAME, sales decreased primarily 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 increased less during the first quarter of 2025 than during the first quarter of 2024.

• Sales decreased in Asia/Pacific due to lower sales volume, unfavorable price realization and unfavorable currency impacts primarily related to the Japanese yen.

Lower sales volume was mainly driven by lower sales of equipment to end users.

Construction Industries’ segment profit was $1.024 billion in the first quarter of 2025, a decrease of $740 million, or 42 percent, compared with $1.764 billion in the first quarter of 2024.

The decrease was mainly due to the profit impact of lower sales volume of $371 million and unfavorable price realization of $355 million.

Construction Industries’ segment profit as a percent of total sales was 23.4 percent in the third quarter of 2024, compared with 26.4 percent in the third quarter of 2023.

Construction Industries’ segment profit as a percentage of total sales was 19.8 percent in the first quarter of 2025, compared with 27.5 percent in the first quarter of 2024.

Resource Industries

Resource Industries’ total sales were $3.028 billion in the third quarter of 2024, a decrease of $323 million, or 10 percent, compared with $3.351 billion in the third quarter of 2023.

The decrease was primarily due to lower sales volume.

Resource Industries’ total sales were $2.884 billion in the first quarter of 2025, a decrease of $309 million, or 10 percent, compared with $3.193 billion in the first quarter of 2024.

The decrease was primarily due to lower sales volume of $179 million, unfavorable price realization of $50 million and unfavorable currency impacts of $46 million, primarily related to the Australian dollar.

The decrease in sales volume was mainly driven by lower sales of equipment to end users.

Resource Industries’ segment profit was $619 million in the third quarter of 2024, a decrease of $111 million, or 15 percent, compared with $730 million in the third quarter of 2023.

Resource Industries’ segment profit was $599 million in the first quarter of 2025, a decrease of $131 million, or 18 percent, compared with $730 million in the first quarter of 2024.

The decrease was mainly due to the profit impact of lower sales volume.

Resource Industries’ segment profit as a percent of total sales was 20.4 percent in the third quarter of 2024, compared with 21.8 percent in the third quarter of 2023.

Energy & Transportation

Sales by Application

(Millions of dollars) Third Quarter 2024 Third Quarter 2023 $

Oil and Gas $ 1,656 $ 1,667 $ (11) (1 %)

Power Generation 2,011 1,598 413 26 %

Industrial 1,028 1,220 (192) (16 %)

Transportation 1,310 1,270 40 3 %

External Sales 6,005 5,755 250 4 %

Inter-segment 1,182 1,104 78 7 %

Total Sales $ 7,187 $ 6,859 $ 328 5 %

Energy & Transportation’s total sales were $7.187 billion in the third quarter of 2024, an increase of $328 million, or 5 percent, compared with $6.859 billion in the third quarter of 2023.

The increase in sales was primarily due to favorable price realization of $213 million and higher sales volume of $135 million, including inter-segment sales.

• Oil and Gas – Sales decreased slightly as lower sales of reciprocating engines used in well servicing were primarily offset by higher sales for turbines and turbine-related services.

• Power Generation – Sales increased in large reciprocating engines, primarily data center applications.

Turbines and turbine-related services increased as well.

• Industrial – Sales decreased in EAME and North America.

• Transportation – Sales increased in marine applications, partially offset by lower deliveries of international locomotives.

Energy & Transportation’s segment profit was $1.433 billion in the third quarter of 2024, an increase of $252 million, or 21 percent, compared with $1.181 billion in the third quarter of 2023.

The increase was mainly due to favorable price realization.

Energy & Transportation’s segment profit as a percent of total sales was 19.9 percent in the third quarter of 2024, compared with 17.2 percent in the third quarter of 2023.

Financial Products Segment

Financial Products’ segment revenues were $1.034 billion in the third quarter of 2024, an increase of $55 million, or 6 percent, compared with $979 million in the third quarter of 2023.

The increase was primarily due to a favorable impact from higher average earning assets of $34 million driven by North America, and a favorable impact from higher average financing rates across all regions of $23 million.

Financial Products’ segment profit was $246 million in the third quarter of 2024, an increase of $43 million, or 21 percent, compared with $203 million in the third quarter of 2023.

The increase was mainly due to a favorable impact from equity securities of $29 million and lower provision for credit losses at Cat Financial of $16 million.

At the end of the third quarter of 2024, past dues at Cat Financial were 1.74 percent, compared with 1.96 percent at the end of the third quarter of 2023.

Write-offs, net of recoveries, were $27 million for the third quarter of 2024, compared with $9 million for the third quarter of 2023.

As of September 30, 2024, Cat Financial's allowance for credit losses totaled $255 million, or 0.87 percent of finance receivables, compared with $254 million, or 0.89 percent of finance receivables at June 30, 2024.

The allowance for credit losses at year-end 2023 was $331 million, or 1.18 percent of finance receivables.

Corporate Items and Eliminations

Expense for corporate items and eliminations was $457 million in the third quarter of 2024, an increase of $89 million from the third quarter of 2023.

Lower corporate costs were more than offset by an unfavorable change in fair value adjustments related to deferred compensation plans, increased expenses due to timing differences, unfavorable impacts of segment reporting methodology differences and higher restructuring costs.

NINE MONTHS ENDED SEPTEMBER 30, 2024 COMPARED WITH NINE MONTHS ENDED SEPTEMBER 30, 2023

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, 2023 (at left) and the nine months ended September 30, 2024 (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 $48.594 billion for the nine months ended September 30, 2024, a decrease of $1.396 billion, or 3 percent, compared with $49.990 billion for the nine months ended September 30, 2023.

The decrease was primarily due to lower sales volume of $2.684 billion, partially offset by favorable price realization of $1.292 billion.

The decrease in sales volume was mainly due to lower sales of equipment to end users.

In addition, changes in dealer inventories had an unfavorable impact to sales volume.

Dealer inventory increased less during the nine months ended September 30, 2024, than during the nine months ended September 30, 2023.

In the three primary segments, sales were lower in Construction Industries and Resource Industries and higher in Energy & Transportation.

North America sales increased 1 percent primarily due to favorable price realization, partially offset by lower sales volume.

The decrease in sales volume is mainly driven by the impact from changes in dealer inventories.

Dealer inventory increased less during the nine months ended September 30, 2024, than during the nine months ended September 30, 2023.

Sales increased 4 percent in Latin America mainly due to higher sales volume.

The increase in sales volume was primarily driven by the impact from changes in dealer inventories.

Dealer inventory increased during the nine months ended September 30, 2024, compared with a decrease during the nine months ended September 30, 2023.

EAME sales decreased 13 percent primarily due to lower sales volume.

The decrease in sales volume was mainly due to lower sales of equipment to end users.

Asia/Pacific sales decreased 7 percent mainly due to lower sales volume.

The decrease in sales volume was primarily driven by the impact from changes in dealer inventories.

Dealer inventory decreased during the nine months ended September 30, 2024, compared with an increase during the nine months ended September 30, 2023.

Total dealer inventory increased about $1.7 billion during the nine months ended September 30, 2024, compared with an increase of about $2.9 billion during the nine months ended September 30, 2023.

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.

Sales and Revenues by Segment

(Millions of dollars) Nine Months Ended September 30, 2023 Sales

Realization Currency Inter-Segment / Other Nine Months Ended September 30, 2024 $

Construction Industries $ 20,899 $ (1,510) $ 230 $ (141) $ (26) $ 19,452 $ (1,447) (7 %)

Resource Industries 10,341 (1,287) 379 (31) 25 9,427 (914) (9 %)

Energy & Transportation 20,332 159 679 (33) 68 21,205 873 4 %

All Other Segment 333 (10) 4 (1) (17) 309 (24) (7 %)

Corporate Items and Eliminations (4,273) (36) — (3) (50) (4,362) (89)

Machinery, Energy & Transportation Sales 47,632 (2,684) 1,292 (209) — 46,031 (1,601) (3 %)

Financial Products Segment 2,804 — — — 225 3,029 225 8 %

Corporate Items and Eliminations (446) — — — (20) (466) (20)

Financial Products Revenues 2,358 — — — 205 2,563 205 9 %

Consolidated Sales and Revenues $ 49,990 $ (2,684) $ 1,292 $ (209) $ 205 $ 48,594 $ (1,396) (3 %)

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, 2024

Construction Industries $ 11,419 (2 %) $ 1,930 12 % $ 3,193 (23 %) $ 2,843 (14 %) $ 19,385 (7 %) $ 67 (28 %) $ 19,452 (7 %)

Resource Industries 3,601 (10 %) 1,498 (1 %) 1,349 (17 %) 2,704 (8 %) 9,152 (9 %) 275 10 % 9,427 (9 %)

Energy & Transportation 9,473 9 % 1,296 — % 4,201 (2 %) 2,602 3 % 17,572 5 % 3,633 2 % 21,205 4 %

All Other Segment 43 (14 %) (1) — % 11 (15 %) 39 5 % 92 (7 %) 217 (7 %) 309 (7 %)

Corporate Items and Eliminations (121) (6) (23) (20) (170) (4,192) (4,362)

Machinery, Energy & Transportation Sales 24,415 1 % 4,717 4 % 8,731 (13 %) 8,168 (7 %) 46,031 (3 %) — — % 46,031 (3 %)

Financial Products Segment 2,022 13 % 299 (5 %) 377 4 % 331 1 % 3,029 1

8 % — — % 3,029 8 %

Corporate Items and Eliminations (276) (60) (60) (70) (466) — (466)

Financial Products Revenues 1,746 14 % 239 (7 %) 317 5 % 261 (1 %) 2,563 9 % — — % 2,563 9 %

Consolidated Sales and Revenues $ 26,161 1 % $ 4,956 4 % $ 9,048 (13 %) $ 8,429 (7 %) $ 48,594 (3 %) $ — — % $ 48,594 (3 %)

Nine Months Ended September 30, 2023

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

Resource Industries 4,016 1,511 1,624 2,940 10,091 250 10,341

Energy & Transportation 8,658 1,299 4,291 2,519 16,767 3,565 20,332

All Other Segment 50 (1) 13 37 99 234 333

Corporate Items and Eliminations (115) (1) (3) (12) (131) (4,142) (4,273)

Machinery, Energy & Transportation Sales 24,263 4,528 10,050 8,791 47,632 — 47,632

Financial Products Segment 1,795 316 364 329 2,804 1

Corporate Items and Eliminations (259) (60) (61) (66) (446) — (446)

Financial Products Revenues 1,536 256 303 263 2,358 — 2,358

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

1 Includes revenues from Machinery, Energy & Transportation of $547 million and $515 million in the nine months ended September 30, 2024 and 2023, respectively.

CONSOLIDATED OPERATING PROFIT

The chart above graphically illustrates reasons for the change in consolidated operating profit between the nine months ended September 30, 2023 (at left) and the nine months ended September 30, 2024 (at right).

Caterpillar management utilizes these charts internally to visually communicate with the company’s board of directors and employees.

The bar titled Longwall Divestiture is included in total restructuring costs.

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, 2024, was $10.148 billion, an increase of $316 million, or 3 percent, compared with $9.832 billion for the nine months ended September 30, 2023.

The increase was primarily due to favorable price realization of $1.292 billion, the absence of the impact of the divestiture of the company's Longwall business in 2023 of $586 million and favorable manufacturing costs of $247 million, partially offset by the profit impact of lower sales volume of $1.106 billion, higher SG&A/R&D expenses of $262 million, higher restructuring costs of $220 million and unfavorable currency impacts of $105 million.

Favorable manufacturing costs largely reflected lower freight.

The increase in SG&A/R&D expenses was primarily driven by investments aligned with strategic initiatives.

For the nine months ended September 30, 2024, restructuring costs increased primarily due to the divestitures of certain non-U.S.

Operating profit margin was 20.9 percent for the nine months ended September 30, 2024, compared with 19.7 percent for the nine months ended September 30, 2023.

Profit (Loss) by Segment

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

Construction Industries $ 4,991 $ 5,440 $ (449) (8 %)

Resource Industries 2,067 2,234 (167) (7 %)

Energy & Transportation 4,259 3,507 752 21 %

All Other Segment 32 42 (10) (24 %)

Corporate Items and Eliminations (1,186) (1,666) 480

Machinery, Energy & Transportation 10,163 9,557 606 6 %

Financial Products Segment 766 675 91 13 %

Corporate Items and Eliminations (298) 60 (358)

Financial Products 468 735 (267) (36 %)

Consolidating Adjustments (483) (460) (23)

Consolidated Operating Profit $ 10,148 $ 9,832 $ 316 3 %

Other Profit/Loss and Tax Items

▪ Interest expense excluding Financial Products for the nine months ended September 30, 2024, was $405 million, compared with $385 million for the nine months ended September 30, 2023.

The increase was due to higher average borrowing rates.

▪ Other income (expense) for the nine months ended September 30, 2024, was income of $387 million, compared with income of $354 million for the nine months ended September 30, 2023.

Unfavorable foreign currency impacts were more than offset by favorable impacts from pension and other postemployment benefit (OPEB) plan costs and higher investment and interest income.

▪ 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.

Excluding the discrete items discussed below, the estimated annual tax rate was 22.5 percent for the nine months ended September 30, 2024, and September 30, 2023, respectively.

The 2024 estimated annual tax rate excludes 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.

The 2023 estimated annual tax rate excludes the impact of the nondeductible loss of $586 million related to the divestiture of the company’s Longwall business.

In the nine months ended September 30, 2024, the company recorded discrete tax benefits of $47 million to reflect changes in estimates related to prior years.

In addition, a discrete tax benefit of $49 million was recorded in the nine months ended September 30, 2024, compared with $54 million for the nine months ended September 30, 2023, for the settlement of stock-based compensation awards with associated tax deductions in excess of cumulative U.S.

GAAP compensation expense.

In the nine months ended September 30, 2023, the company recorded a discrete tax benefit of $88 million due to a change in the valuation allowance for certain deferred tax assets.

Please see a reconciliation of GAAP to non-GAAP financial measures on pages 66-68.

Construction Industries

Construction Industries’ total sales were $19.452 billion for the nine months ended September 30, 2024, a decrease of $1.447 billion, or 7 percent, compared with $20.899 billion for the nine months ended September 30, 2023.

The decrease was primarily due to lower sales volume.

The decrease in sales volume was mainly driven by lower sales of equipment to end users.

• In North America, sales decreased primarily due to lower sales volume, partially offset by favorable price realization.

Lower sales volume was mainly driven by lower sales of equipment to end users and the impact from changes in dealer inventories.

Dealer inventory increased less during the nine months ended September 30, 2024, than during the nine months ended September 30, 2023.

• Sales increased in Latin America mainly due to higher sales volume, partially offset by unfavorable price realization.

Higher sales volume was driven primarily by the impact from changes in dealer inventories.

Dealer inventory increased during the nine months ended September 30, 2024, compared with a decrease during the nine months ended September 30, 2023.

• In EAME, sales decreased primarily due to lower sales volume.

Lower sales volume was mainly due to lower sales of equipment to end users.

• Sales decreased in Asia/Pacific mainly due to lower sales volume and unfavorable currency impacts primarily related to the Japanese yen.

Lower sales volume was mainly driven by the impact from changes in dealer inventories.

Dealer inventory decreased during the nine months ended September 30, 2024, compared with an increase during the nine months ended September 30, 2023.

Construction Industries’ profit was $4.991 billion for the nine months ended September 30, 2024, a decrease of $449 million, or 8 percent, compared with $5.440 billion for the nine months ended September 30, 2023.

The decrease was mainly due to the profit impact of lower sales volume of $842 million and higher SG&A/R&D expenses of $74 million, partially offset by favorable manufacturing costs of $256 million and favorable price realization of $230 million.

The increase in SG&A/R&D expenses was primarily driven by investments aligned with strategic initiatives.

Favorable manufacturing costs were primarily driven by lower material costs.

Construction Industries’ profit as a percent of total sales was 25.7 percent for the nine months ended September 30, 2024, compared with 26.0 percent for the nine months ended September 30, 2023.

Resource Industries

Resource Industries’ total sales were $9.427 billion for the nine months ended September 30, 2024, a decrease of $914 million, or 9 percent, compared with $10.341 billion for the nine months ended September 30, 2023.

The decrease was primarily due to lower sales volume of $1.287 billion, partially offset by favorable price realization of $379 million.

The decrease in sales volume was mainly due to lower sales of equipment to end users.

Resource Industries’ profit was $2.067 billion for the nine months ended September 30, 2024, a decrease of $167 million, or 7 percent, compared with $2.234 billion for the nine months ended September 30, 2023.

The decrease was mainly due to the profit impact of lower sales volume of $523 million, partially offset by favorable price realization of $379 million.

Resource Industries’ profit as a percent of total sales was 21.9 percent for the nine months ended September 30, 2024, compared with 21.6 percent for the nine months ended September 30, 2023.

Resource Industries’ segment profit as a percentage of total sales was 20.8 percent in the first quarter of 2025, compared with 22.9 percent in the first quarter of 2024.

Energy & Transportation

Sales by Application

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

(Millions of dollars) First Quarter 2025 First Quarter 2024 $

Oil and Gas $ 1,258 $ 1,568 $ (310) (20 %)

5 unchanged sentences

Total Sales $ 6,568 $ 6,681 $ (113) (2 %)

Energy & Transportation’s total sales were $21.205 billion for the nine months ended September 30, 2024, an increase of $873 million, or 4 percent, compared with $20.332 billion for the nine months ended September 30, 2023.

Sales increased across all applications except Industrial.

The increase in sales was primarily due to favorable price realization of $679 million and higher sales volume of $227 million, including inter-segment sales.

• Oil and Gas – Sales increased for turbines and turbine-related services.

Energy & Transportation’s total sales were $6.568 billion in the first quarter of 2025, a decrease of $113 million, or 2 percent, compared with $6.681 billion in the first quarter of 2024.

The decrease was primarily due to lower sales volume of $175 million, unfavorable currency impacts of $69 million primarily related to the euro, and lower inter-segment sales of $24 million, partially offset by favorable price realization of $155 million.

• Oil and Gas – Sales decreased in reciprocating engines used in gas compression and well servicing applications.

Sales also decreased for turbines and turbine-related services.

• Power Generation – Sales increased in large reciprocating engines, primarily data center applications.

Turbines and turbine-related services increased as well.

• Industrial – Sales decreased in EAME and North America.

• Transportation – Sales increased in marine applications and rail services.

Energy & Transportation’s profit was $4.259 billion for the nine months ended September 30, 2024, an increase of $752 million, or 21 percent, compared with $3.507 billion for the nine months ended September 30, 2023.

The increase was mainly due to favorable price realization.

Energy & Transportation’s profit as a percent of total sales was 20.1 percent for the nine months ended September 30, 2024, compared with 17.2 percent for the nine months ended September 30, 2023.

• Industrial – Sales decreased primarily in North America and Asia/Pacific, partially offset by increased sales in EAME.

• Transportation – Sales decreased in marine.

International locomotive deliveries were also lower.

Energy & Transportation’s segment profit was $1.314 billion in the first quarter of 2025, an increase of $13 million, or 1 percent, compared with $1.301 billion in the first quarter of 2024.

The increase was primarily due to favorable price realization of $155 million, mostly offset by the profit impact of lower sales volume of $114 million and unfavorable manufacturing costs of $40 million.

Unfavorable manufacturing costs largely reflected increased period manufacturing costs.

Energy & Transportation’s segment profit as a percentage of total sales was 20.0 percent in the first quarter of 2025, compared with 19.5 percent in the first quarter of 2024.

Financial Products Segment

Financial Products’ segment revenues were $3.029 billion for the nine months ended September 30, 2024, an increase of $225 million, or 8 percent, compared with $2.804 billion for the nine months ended September 30, 2023.

The increase was primarily due to a favorable impact from higher average financing rates across all regions of $142 million and a favorable impact from higher average earning assets of $98 million, driven by North America.

Financial Products’ segment profit was $766 million for the nine months ended September 30, 2024, an increase of $91 million, or 13 percent, compared with $675 million for the nine months ended September 30, 2023.

The increase was mainly due to a favorable impact from equity securities of $55 million, a favorable impact from higher average earning assets of $42 million, the absence of prior year unfavorable currency impacts of $34 million and an insurance settlement of $33 million, partially offset by an increase in SG&A expenses of $43 million and an unfavorable impact from returned or repossessed equipment of $36 million.

Financial Products’ segment revenues were $1.007 billion in the first quarter of 2025, an increase of $16 million, or 2 percent, compared with $991 million in the first quarter of 2024.

The increase was primarily due to a favorable impact from higher average earning assets of $28 million driven by North America, partially offset by an unfavorable impact from lower average financing rates of $15 million primarily in North America.

Financial Products’ segment profit was $215 million in the first quarter of 2025, a decrease of $78 million, or 27 percent, compared with $293 million in the first quarter of 2024.

The decrease was mainly due to the absence of an insurance settlement of $33 million in the first quarter of 2024, higher provision for credit losses at Cat Financial of $22 million, an unfavorable impact from lower net yield on average earning assets of $14 million and an unfavorable impact from equity securities of $14 million.

At the end of the first quarter of 2025, past dues at Cat Financial were 1.58 percent, compared with 1.78 percent at the end of the first quarter of 2024.

Write-offs, net of recoveries, were $20 million for the first quarter of 2025, compared with $55 million for the first quarter of 2024.

As of March 31, 2025, Cat Financial's allowance for credit losses totaled $282 million, or 0.95 percent of finance receivables, compared with $267 million, or 0.91 percent of finance receivables at December 31, 2024.

Corporate Items and Eliminations

Expense for corporate items and eliminations was $1.484 billion for the nine months ended September 30, 2024, a decrease of $122 million from the nine months ended September 30, 2023, primarily driven by the absence of the impact of the divestiture of the company's Longwall business in 2023, partially offset by unfavorable impacts of segment reporting methodology differences and higher restructuring costs.

For the nine months ended September 30, 2024, restructuring costs increased primarily due to the divestitures of certain non-U.S.

Expense for corporate items and eliminations was $415 million in the first quarter of 2025, a decrease of $25 million from the first quarter of 2024, driven by a favorable change in fair value adjustments related to deferred compensation plans and decreased expenses due to timing differences, partially offset by unfavorable impacts of segment reporting methodology differences, unfavorable restructuring income/costs and higher corporate costs.

RESTRUCTURING COSTS

In 2024, we expect to incur about $400 million of restructuring costs.

In 2025, we expect to incur about $150 million to $200 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 costs" of Part I, Item 1 "Financial Statements."

Additional information related to restructuring costs is included in Note 20 – "Restructuring income/costs" of Part I, Item 1 "Financial Statements."

GLOSSARY OF TERMS

Adjusted Operating Profit Margin – Operating profit excluding restructuring income/costs as a percent of sales and revenues.

Adjusted Profit Per Share – Profit per share excluding restructuring income/costs and a discrete tax benefit to adjust deferred tax balances.

Adjusted Operating Profit Margin – Operating profit excluding restructuring income/costs as a percentage of sales and revenues.

Adjusted Profit Per Share – Profit per share excluding restructuring income/costs.

All Other Segment – Primarily includes activities such as:

44 unchanged sentences

electrified powertrain and zero-emission power sources and service solutions development;

and diesel-electric locomotives and components and other rail-related products and services, including remanufacturing and leasing.

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.

52 unchanged sentences

The impact of sales volume on segment profit includes inter-segment sales.

Services – Enterprise services include, but are not limited to, aftermarket parts, Financial Products revenues and other service-related revenues.

Machinery, Energy & Transportation segments exclude most Financial Products revenues.

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

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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 2024 and ended the third quarter with $5.64 billion of cash, a decrease of $1.34 billion from year-end 2023.

On a consolidated basis, we had positive operating cash flow in the first three months of 2025 and ended the first quarter with $3.562 billion of cash, a decrease of $3.327 billion 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 $1.77 billion as of September 30, 2024 and are included in Prepaid expenses and other current assets and Other assets in the Consolidated Statement of Financial Position.

These ME&T securities were $1.215 billion as of March 31, 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 2024 was $8.64 billion, down $240 million compared to the same period a year ago.

The decrease was primarily due to changes in accrued wages, salaries and benefits, and higher cash taxes paid, partially offset by lower working capital requirements, excluding changes in accrued wages, salaries and benefits.

Within working capital, changes in inventory, accounts payable and receivables favorably impacted cash flow in the first nine months of 2024 compared to the prior year period, partially offset by unfavorable changes in accrued expenses.

Total debt as of September 30, 2024 was $37.90 billion, an increase of $23 million from year-end 2023.

Debt related to ME&T decreased $886 million in the first nine months of 2024 while debt related to Financial Products increased $966 million.

As of September 30, 2024, we had three global credit facilities with a syndicate of banks totaling $10.50 billion (Credit Facility) available in the aggregate to both Caterpillar and Cat Financial for general liquidity purposes.

Based on management’s allocation decision, which can be revised from time to time, the portion of the Credit Facility available to ME&T as of September 30, 2024 was $2.75 billion.

Consolidated operating cash flow for the first three months of 2025 was $1.289 billion, down $763 million compared to the same period a year ago.

The decrease was primarily due to lower profit before taxes adjusted for non-cash items.

Total debt as of March 31, 2025 was $38.588 billion, an increase of $179 million from year-end 2024.

Debt related to ME&T increased $63 million in the first three months of 2025, while debt related to Financial Products increased $142 million.

As of March 31, 2025, we had three global credit facilities with a syndicate of banks totaling $10.500 billion (Credit Facility) available in the aggregate to both Caterpillar and Cat Financial for general liquidity purposes.

Based on management’s allocation decision, which can be revised from time to time, the portion of the Credit Facility available to ME&T as of March 31, 2025 was $2.750 billion.

Information on our Credit Facility is as follows:

• In August 2024, we entered into a new 364-day facility.

• The 364-day facility of $3.150 billion (of which $825 million is available to ME&T) expires in August 2025.

• In August 2024, we amended and extended the three-year facility (as amended and restated, the "three-year facility").

The three-year facility of $2.73 billion (of which $715 million is available to ME&T) expires in August 2027.

• In August 2024, we amended and extended the five-year facility (as amended and restated, the "five-year facility").

The five-year facility of $4.62 billion (of which $1.21 billion is available to ME&T) expires in August 2029.

At September 30, 2024, Caterpillar’s consolidated net worth was $19.46 billion, which was above the $9.00 billion required under the Credit Facility.

• The three-year facility, as amended in August 2024, of $2.730 billion (of which $715 million is available to ME&T) expires in August 2027.

• The five-year facility, as amended in August 2024, of $4.620 billion (of which $1.210 billion is available to ME&T) expires in August 2029.

At March 31, 2025, Caterpillar’s consolidated net worth was $18.132 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, 2024, Cat Financial’s covenant interest coverage ratio was 1.46 to 1.

At March 31, 2025, Cat Financial’s covenant interest coverage ratio was 1.36 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 period, required by the Credit Facility.

In addition, at September 30, 2024, Cat Financial’s six-month covenant leverage ratio was 6.77 to 1.

In addition, at March 31, 2025, Cat Financial’s six-month covenant leverage ratio was 7.42 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.

1 unchanged sentence

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, 2024, there were no borrowings under the Credit Facility.

At March 31, 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.

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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, 2024 were:

September 30, 2024

Our total credit commitments and available credit as of March 31, 2025 were:

March 31, 2025

(Millions of dollars) Consolidated Machinery,

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Available credit $ 10,738 $ 3,362 $ 7,376

The other external consolidated credit lines with banks as of September 30, 2024 totaled $4.25 billion.

The other external consolidated credit lines with banks as of March 31, 2025 totaled $3.944 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.

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Machinery, Energy & Transportation

Net cash provided by operating activities was $7.73 billion in the first nine months of 2024, compared with net cash provided of $7.96 billion for the same period in 2023.

The decrease was primarily due to lower profit before taxes, adjusted for non-cash items, changes in accrued wages, salaries, and employee benefits, and higher cash taxes paid.

These were partially offset by lower working capital requirements, excluding the impact of changes in accrued wages, salaries, and employee benefits.

Within working capital, changes in inventory, receivables and accounts payable favorably impacted cash flow in the first nine months of 2024 compared to the prior year period, partially offset by changes in accrued expenses.

Net cash provided by investing activities in the first nine months of 2024 was $1.01 billion, compared with net cash used of $3.89 billion in the first nine months of 2023.

The change was due to lower new investments in securities and higher proceeds from maturities and sale of securities, primarily due to time deposit maturities in 2024, as compared to the same period in 2023.

Net cash used for financing activities during the first nine months of 2024 was $10.04 billion, compared with net cash used of $4.18 billion in the same period of 2023.

The change was primarily due to higher payments to repurchase shares and debt repayments in the first nine months of 2024 compared to the same period in 2023.

Net cash provided by operating activities was $926 million in the first three months of 2025, compared with net cash provided of $1.771 billion for the same period in 2024.

The decrease was primarily due to lower profit before taxes, adjusted for non-cash items, and higher working capital requirements.

Within working capital, changes in inventories unfavorably impacted cash flow, but were partially offset by changes in customer advances.

Net cash provided by investing activities in the first three months of 2025 was $30 million, compared with net cash provided of $1.225 billion in the first three 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.

Net cash used for financing activities during the first three months of 2025 was $4.432 billion, compared with net cash used of $5.120 billion in the same period of 2024.

The change was primarily due to lower payments to purchase common stock in the first three 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.

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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 $1.28 billion during the first nine months of 2024, compared to $1.11 billion for the same period in 2023.

Operational excellence and commitments – Capital expenditures were $704 million during the first three months of 2025, compared to $502 million for the same period in 2024.

We expect ME&T’s capital expenditures in 2025 to be about $2.5 billion.

We made $221 million of contributions to our pension and other postretirement benefit plans during the first nine months of 2024.

We made $211 million of contributions to our pension and other postretirement benefit plans during the first three months of 2025.

We currently anticipate full-year 2025 contributions of approximately $354 million.

In comparison, we made $320 million of contributions to our pension and other postretirement benefit plans during the first nine months of 2023.

In comparison, we made $113 million of contributions to our pension and other postretirement benefit plans during the first three 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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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 April 2025, the Board of Directors approved maintaining our quarterly dividend representing $1.41 per share, and we continue to expect our strong financial position to support the dividend.

Dividends paid totaled $674 million in the first three 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.

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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 2024, we repurchased $7.06 billion of Caterpillar common stock, with $20.8 billion remaining under the 2022 and 2024 Authorizations as of September 30, 2024.

Our basic shares outstanding as of September 30, 2024 were approximately 483 million.

Each quarter, our Board of Directors reviews the company’s dividend for the applicable quarter.

In October 2024, the Board of Directors approved maintaining our quarterly dividend representing $1.41 per share, and we continue to expect our strong financial position to support the dividend.

Dividends paid totaled $1.97 billion in the first nine months of 2024.

In the first three months of 2025, we repurchased $3.660 billion of Caterpillar common stock.

As of March 31, 2025, the 2022 Authorization was fully utilized and $16.468 billion remained available under the 2024 Authorization.

Our basic shares outstanding as of March 31, 2025 were approximately 471 million.

Financial Products

Net cash provided by operating activities was $1.02 billion in the first nine months of 2024, compared with $905 million for the same period in 2023.

Net cash used for investing activities was $1.90 billion in the first nine months of 2024, compared with $1.25 billion for the same period in 2023.

The change was primarily due to portfolio related activity and the divestiture of a non-U.S.

Net cash provided by financing activities was $890 million in the first nine months of 2024, compared with $122 million for the same period in 2023.

The change was due to a higher net inflow from external borrowings and the absence of dividends paid to Caterpillar.

Net cash provided by operating activities was $297 million in the first three months of 2025, compared with $308 million for the same period in 2024.

Net cash used for investing activities was $132 million in the first three months of 2025, compared with $291 million for the same period in 2024.

The change was primarily due to portfolio related activity and an increase in proceeds from maturities and sale of securities.

Net cash used for financing activities was $71 million in the first three months of 2025, compared with net cash provided of $117 million for the same period in 2024.

The change was due to external borrowing activity.

RECENT ACCOUNTING PRONOUNCEMENTS

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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, 2024.

It is difficult to predict the December 31, 2024 adjustment amount, as it will be dependent primarily on changes in discount rates during 2024, and actual returns on plan assets differing from our expected returns for 2024.

Order Backlog

At the end of the third quarter of 2024, the dollar amount of backlog believed to be firm was approximately $28.7 billion, about $0.1 billion higher than the second quarter of 2024.

The order backlog increased in Energy & Transportation, while Construction Industries and Resource Industries decreased.

Of the total backlog at September 30, 2024, approximately $6.8 billion was not expected to be filled in the following twelve months.

At the end of the first quarter of 2025, the dollar amount of backlog believed to be firm was approximately $35.0 billion, about $5.0 billion higher than the fourth quarter of 2024.

The order backlog increased across the primary segments, with the largest increase in Energy & Transportation.

Of the total backlog at March 31, 2025, approximately $9.2 billion was not expected to be filled in the following twelve months.

NON-GAAP FINANCIAL MEASURES

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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 four significant items in order for our results to be meaningful to our readers.

These items consist of (i) restructuring income/costs related to the divestitures of certain non-U.S.

entities in 2024, (ii) other restructuring income/costs, (iii) restructuring costs related to the divestiture of the company's Longwall business in 2023 and (iv) certain deferred tax valuation allowance adjustments in 2023.

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 our period-over-period results.

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 readers.

These items consist of (i) other restructuring income/costs and (ii) restructuring income related to the divestiture of a non-U.S.

mining entity in 2024.

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, 2024 - U.S.

$ 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

Three Months Ended September 30, 2023 - U.S.

$ 3,449 20.5 % $ 3,515 $ 734 $ 2,794 $ 5.45

Other restructuring (income) costs 46 0.3 % 46 10 36 0.07

Three Months Ended September 30, 2023 - Adjusted

$ 3,495 20.8 % $ 3,561 $ 744 $ 2,830 $ 5.52

Nine Months Ended September 30, 2024 - U.S.

Three Months Ended March 31, 2025 - U.S.

$ 2,579 18.1 % $ 2,570 $ 574 $ 2,003 $ 4.20

Restructuring (income) costs - divestitures of certain non-U.S.

entities 164 0.3 % 164 54 110 0.22

Other restructuring (income) costs 32 0.2 % 33 8 25 0.05

Nine Months Ended September 30, 2024 - Adjusted

Three Months Ended March 31, 2025 - Adjusted

$ 2,611 18.3 % $ 2,603 $ 582 $ 2,028 $ 4.25

Nine Months Ended September 30, 2023 - U.S.

Three Months Ended March 31, 2024 - U.S.

$ 3,519 22.3 % $ 3,532 $ 688 $ 2,856 $ 5.75

Restructuring costs - Longwall divestiture 586 1.2 % 586 — 586 1.13

Restructuring (income) - non-U.S.

mining entity divestiture (64) (0.5) % (64) 54 (118) (0.24)

Other restructuring (income) costs 58 0.4 % 58 14 44 0.09

Deferred tax valuation allowance adjustments — — % — 88 (88) (0.17)

Nine Months Ended September 30, 2023 - Adjusted

Three Months Ended March 31, 2024 - Adjusted

$ 3,513 22.2 % $ 3,526 $ 756 $ 2,782 $ 5.60

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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) restructuring income/costs related to the divestitures of certain non-U.S.

entities in 2024, (ii) the impact of changes in estimates related to prior years in 2024, (iii) settlement of stock-based compensation awards with associated tax deductions in excess of cumulative U.S.

GAAP compensation expense, (iv) certain deferred tax valuation allowance adjustments in 2023, (v) the decrease in the annual effective tax rate in 2023 and (vi) restructuring costs related to the divestiture of the company's Longwall business in 2023.

For the three months ended March 31, 2025, and 2024, these items consist of (i) the settlement of stock-based compensation awards with associated tax deductions in excess of cumulative U.S.

GAAP compensation expense and (ii) restructuring income related to the divestiture of a non-U.S.

mining entity 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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(Millions of dollars) Profit Before Taxes Provision (Benefit) for Income Taxes Effective Tax Rate

Three Months Ended September 30, 2024 - U.S.

$ 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

Three Months Ended September 30, 2023 - U.S.

$ 3,515 $ 734 20.9 %

Decrease in annual effective tax rate — 34

Excess stock-based compensation — 22

Annual effective tax rate, excluding discrete items $ 3,515 $ 790 22.5 %

Decrease in annual effective tax rate — (34)

Excess stock-based compensation — (22)

Other restructuring (income) costs 46 10

Three Months Ended September 30, 2023 - Adjusted

$ 3,561 $ 744

Nine Months Ended September 30, 2024 - U.S.

Three Months Ended March 31, 2025 - U.S.

$ 2,570 $ 574 22.3 %

Restructuring (income) costs - divestitures of certain non-U.S.

entities 164 54

Changes in estimates related to prior years — 47

Excess stock-based compensation — 17

Annual effective tax rate, excluding discrete items $ 2,570 $ 591 23.0 %

Changes in estimates related to prior years — (47)

Excess stock-based compensation — (17)

Other restructuring (income) costs 33 8

Nine Months Ended September 30, 2024 - Adjusted

Three Months Ended March 31, 2025 - Adjusted

$ 2,603 $ 582

Nine Months Ended September 30, 2023 - U.S.

Three Months Ended March 31, 2024 - U.S.

$ 3,532 $ 688 19.5 %

Restructuring costs - Longwall divestiture 586 —

Deferred tax valuation allowance adjustments — 88

Restructuring (income) - non-US mining entity divestiture (64) 54

Excess stock-based compensation — 38

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Other restructuring (income) costs 58 14

Nine Months Ended September 30, 2023 - Adjusted

Three Months Ended March 31, 2024 - Adjusted

$ 3,526 $ 756

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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,

(Millions of dollars) Three Months Ended March 31,

ME&T net cash provided by operating activities 1

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consolidated financial information.

Certain amounts for prior periods have been reclassified to conform to the current period presentation.

Caterpillar Inc.

Supplemental Data for Results of Operations

For the Three Months Ended September 30, 2024

(Millions of dollars)

Supplemental Consolidating Data

Consolidated Machinery,

Transportation Financial

Products Consolidating

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) 3

Other income (expense) 76 (122) 33 165 4

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 —

Profit (loss) attributable to noncontrolling interests (1) (1) — —

$ 2,464 $ 2,275 $ 189 $ —

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.

Caterpillar Inc.

Supplemental Data for Results of Operations

For the Nine Months Ended September 30, 2024

For the Three Months Ended March 31, 2025

(Millions of dollars)

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Profit of consolidated and affiliated companies 2,003 1,838 165 —

Profit (loss) attributable to noncontrolling interests (3) (4) 1 —

$ 2,003 $ 1,838 $ 165 $ —

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Supplemental Data for Results of Operations

For the Three Months Ended September 30, 2023

(Millions of dollars)

Supplemental Consolidating Data

Consolidated Machinery,

Transportation Financial

Products Consolidating

Sales and revenues:

Sales of Machinery, Energy & Transportation $ 15,988 $ 15,988 $ — $ —

Revenues of Financial Products 822 — 1,017 (195) 1

Total sales and revenues 16,810 15,988 1,017 (195)

Operating costs:

Cost of goods sold 10,583 10,586 — (3) 2

Selling, general and administrative expenses 1,624 1,430 206 (12) 2

Research and development expenses 554 554 — —

Interest expense of Financial Products 280 — 280 —

Other operating (income) expenses 320 25 310 (15) 2

Total operating costs 13,361 12,595 796 (30)

Operating profit 3,449 3,393 221 (165)

Interest expense excluding Financial Products 129 129 — —

Other income (expense) 195 42 (12) 165 3

Consolidated profit before taxes 3,515 3,306 209 —

Provision (benefit) for income taxes 734 654 80 —

Profit of consolidated companies 2,781 2,652 129 —

Equity in profit (loss) of unconsolidated affiliated companies 12 12 — —

Profit of consolidated and affiliated companies 2,793 2,664 129 —

Profit (loss) attributable to noncontrolling interests (1) (1) — —

$ 2,794 $ 2,665 $ 129 $ —

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.

Caterpillar Inc.

Supplemental Data for Results of Operations

For the Nine Months Ended September 30, 2023

For the Three Months Ended March 31, 2024

(Millions of dollars)

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1 Elimination of Financial Products’ revenues earned from ME&T.

2 Elimination of net expenses recorded by ME&T paid to Financial Products.

2 Elimination of net expenses recorded between ME&T and Financial Products.

4 Elimination of equity profit (loss) earned from Financial Products’ subsidiaries partially owned by ME&T subsidiaries.

5 Elimination of noncontrolling interest profit (loss) recorded by Financial Products for subsidiaries partially owned by ME&T subsidiaries.

4 Profit attributable to common shareholders.

1 unchanged sentence

Supplemental Data for Financial Position

At September 30, 2024

At March 31, 2025

(Millions of dollars)

108 unchanged sentences

Supplemental Data for Cash Flow

For the Nine Months Ended September 30, 2024

For the Three Months Ended March 31, 2025

(Millions of dollars)

8 unchanged sentences

Provision (benefit) for deferred income taxes (38) (34) (4) —

(Gain) loss on divestiture 164 (46) 210 —

Other 78 76 (123) 125 1

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Supplemental Data for Cash Flow

For the Nine Months Ended September 30, 2023

For the Three Months Ended March 31, 2024

(Millions of dollars)

29 unchanged sentences

Net intercompany borrowings — — 3 (3) 3

Investments and acquisitions (net of cash acquired) (67) (67) — —

Proceeds from sale of businesses and investments (net of cash sold) 42 42 — —

Proceeds from sale of securities 747 553 194 —

Proceeds from maturities and sale of securities 1,867 1,797 70 —

Investments in securities (275) (148) (127) —

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Cash, cash equivalents and restricted cash at end of period $ 4,965 $ 3,967 $ 998 $ —

1 Elimination of equity profit earned from Financial Products' subsidiaries partially owned by ME&T subsidiaries.

1 Elimination of non-cash adjustments and changes in assets and liabilities related to consolidated reporting.

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3 Elimination of net proceeds and payments to/from ME&T and Financial Products.

5 Elimination of dividend activity between Financial Products and ME&T.

Forward-looking Statements

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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 2. Management’s Discussion and Analysis