Caterpillar’s second quarter reflected operational resilience, with flat year-on-year sales and revenue that slightly exceeded Wall Street expectations. However, non-GAAP profit per share was below consensus, and the company’s operating margin declined compared to the prior year, largely due to unfavorable price realization and the impact of tariffs. CEO Joseph Creed emphasized strong order activity and ongoing infrastructure and energy demand, noting, “Our backlog grew by $2.5 billion with increases across all three primary segments.”

Is now the time to buy CAT? Find out in our full research report (it’s free).

While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions From Caterpillar’s Q2 Earnings Call

• Tami Zakaria (JPMorgan): asked about long-term mitigation of tariff headwinds. CEO Joseph Creed said actions like supply chain changes and pricing adjustments are being considered, but more clarity is needed before executing structural moves.
• David Michael Raso (Evercore ISI): questioned the ability to reprice the existing backlog to offset margin pressure. Creed replied that there is some flexibility, especially as merchandising program impacts start to fade, and that balancing volume and profitability remains a focus.
• Jamie Lyn Cook (Truist Securities): inquired about the effect of capacity additions in Energy & Transportation on sales and margins. Creed said the bulk of new capacity will be realized towards the end of next year and into 2027, with ongoing improvements expected in efficiency and output.
• Kristen Owen (Oppenheimer): sought clarification on tariff-related uncertainties and risks to guidance. CFO Andrew Bonfield stated that the situation is fluid, with potential changes depending on country negotiations and ongoing trade investigations.
• Kyle David Menges (Citigroup): asked about Resource Industries backlog visibility into 2026 and exposure to commodity weakness. Creed noted strong order rates for large trucks but declined to give commodity-specific exposure, stating coal revenues are now a low single-digit percentage of total.

Catalysts in Upcoming Quarters

In the coming quarters, the StockStory team will be watching (1) the degree to which Caterpillar can mitigate ongoing tariff headwinds through cost controls or supply chain adjustments, (2) sustained growth in backlog and order activity across all major segments, and (3) the impact of evolving pricing strategies and merchandising programs on realized margins. Execution on planned capacity expansions, especially in power generation, will also be a key marker of progress.

Caterpillar currently trades at $413.05, down from $433.93 just before the earnings. At this price, is it a buy or sell? See for yourself in our full research report (it’s free).

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