Why Caterpillar Stock Jumped to Record High Today

Core Insights - Caterpillar's shares increased by over 11% following the announcement that the AI boom is positively impacting its sales and profits [1] Financial Performance - Caterpillar's sales rose by 10% to $17.6 billion in Q3, driven by a 33% increase in power-generation revenue, particularly from sales of reciprocating engines for AI data centers [3] - Adjusted operating margin decreased to 17.5% from 20% year-over-year, and adjusted earnings per share fell to $4.95 from $5.17, although this exceeded Wall Street's expectations of $4.52 [4] - The company generated $3.2 billion in free cash flow in Q3, allowing for approximately $700 million in dividends and $400 million in stock buybacks [5] Future Growth Prospects - Caterpillar's order backlog reached a record $39.8 billion, increasing by $2.4 billion from Q2 and by $11.2 billion from Q3 2024, indicating strong future growth potential [6]