Caterpillar (NYSE:CAT) on Tuesday reported a 54% drop in earnings in the third quarter as equipment sales declined across all regions and segments.
The industrial machinery manufacturer posted adjusted earnings per share of $1.34 on revenue of $9.9 billion in the quarter. Its third-quarter sales marked a 23% decline year over year and profit per share dropped 54% compared to the same quarter a year ago.
Still, the Deerfield, Illinois-based company’s results came in above Wall Street’s expectations. Analysts were expecting adjusted earnings per share of $1.18 on revenue of $9.798 billion.
During the third quarter of 2020, retail new business volume was $2.60 billion, a decrease of $329 million , or 11%, from the third quarter of 2019. The decrease was driven by lower volume across all segments with the exception of a slight increase in Asia/Pacific.
Caterpillar said the decline was primarily due to lower sales volume driven by lower end-user demand for equipment and services and the impact from decreases in dealer inventories.
Shares of Caterpillar faded $3.06, or 1.9%, to $160.14, in early Tuesday trading following the results. The stock is up about 10% in 2020.
"Our third-quarter results largely aligned with our expectations, and we’re encouraged by positive signs in certain industries and geographies," Caterpillar CEO Jim Umpleby said.
"We’re executing our strategy and are ready to respond quickly to changing market conditions."
In the second quarter, Caterpillar’s profit dropped 70% year over year to $1.03 as the coronavirus-triggered recession slashed demand for equipment.
