Caterpillar has best year ever but tariffs weigh on profits

Core Insights - Caterpillar achieved its highest sales year ever, with full-year revenues reaching a record $67.6 billion and fourth-quarter revenue at $19.1 billion [1][2] Financial Performance - Operating profit for the year was $11.2 billion, reflecting a 16% decline from 2024, while quarterly profit was $2.7 billion, down 9% over the same period [2] - Profits per share decreased both sequentially and on a full-year basis [2] Sales and Margins - The construction vehicles unit saw a 15% increase in sales, but profits fell by 12% due to unfavorable manufacturing costs and higher tariffs [3] - Mining equipment sales rose by 13%, yet profits declined by 24% [3] - Profit growth was noted in financial products and power & energy, offsetting some margin pressures [3] Future Outlook - Caterpillar forecasts similar sales and revenue growth trends for 2026, with an estimated tariff impact of $2.6 billion, equating to around $800 million per quarter [4] Industry Context - Competitors like Deere & Company are experiencing similar margin pressures due to tariffs, indicating a broader industry trend of resilient sales but challenged margins [5]