Caterpillar Inc. (CAT) reported first-quarter adjusted earnings per share of $5.04, beating the $4.92 consensus, as the world's largest construction-equipment manufacturer logged a record $32.0 billion order backlog. Total Q1 revenue declined 1.8% to $15.4 billion, in line with consensus, but order intake jumped 18% year-on-year — the strongest sequential improvement since 2022.
The most significant disclosure was the breakdown of the firm's Energy & Transportation segment, where revenue rose 7.2% to $7.0 billion. Within E&T, the power-generation sub-segment — which includes natural-gas-fueled engines used in backup data-center power applications — grew 33% year-on-year, with new orders up 78% on the back of mega-deals from hyperscalers and co-location operators. Backup-generator backlogs are now sold out through Q3 2027.
AI Power Tailwind
CEO Joe Creed said in the call that "approximately 35% of incremental power-generation orders in Q1 are directly tied to AI infrastructure build-out." Caterpillar competes with Cummins (CMI) and Generac (GNRC) in the backup-generation market. The recently launched 5500 series of natural-gas reciprocating engines, capable of providing 16 megawatts each, accounted for 22% of E&T orders. Customer requests for accelerated delivery have prompted the company to authorize a 12% expansion of its Lafayette, Indiana, manufacturing footprint.
Construction Industries revenue declined 5.4% to $6.2 billion as North American resi and non-resi construction volumes softened with mortgage rates at 7.42%. Latin America was the bright spot, rising 14% on Brazilian and Mexican infrastructure programs. Resource Industries rose 1.2% as mining-equipment orders, particularly for autonomous haul trucks and trolley-equipped 793F dump trucks, returned to growth on the back of recovering copper and lithium prices.
Stock Reaction
Caterpillar shares rose 4.8% in Wednesday pre-market trade to $402.40, a fresh 52-week high. Cummins rose 3.6%, Vistra (