Caterpillar on Thursday delivered second quarter earnings that matched expectations, but its revenue missed forecasts and the heavy equipment giant cut its full-year sales guidance.
Shares of Caterpillar fell 2 percent in premarket trading following the announcement. (Click here to track its shares.)
In an interview on CNBC's "Squawk Box," Chairman and CEO Doug Oberhelman cited several factors for the pessimistic outlook. "We've got an oil price cut in half, commodities are at their lows for quite a few years at this pointand global growth is slow," he said.
Along with earnings, the company announced plans to buy back $1.5 billion in common stock in the third quarter. That's in addition to the $4.2 billion repurchased in 2014.
In the absence of compelling acquisitions and little demand for capital expenditures, he said returning cash to shareholders in the form of buybacks makes sense.
"We have a lot of cash on our balance sheet. And our balance sheet is strong. Our debt-to-cap ratio is as strong as it's been in decades. Having cash just sit on the balance sheet doesn't do anybody as good," Oberhelman told CNBC
Caterpillar posted second-quarter earnings of $1.27 per share, down from $1.69 a share in the year-earlier period. Revenue fell to $12.32 billion from $14.15 billion a year ago.
Wall Street had expected Caterpillar to deliver quarterly earnings per share of $1.27 on $12.62 billion in revenue, according to consensus estimates from Thomson Reuters.
The company backed its full-year adjusted earnings guidance of $4.70 to $5 per share, but cut its outlook for sales and revenue from its previous forecast by $1 billion to about $49 billion.
"I think it's a function of a global growth rate of 2 percent to 2.5 percent. For us to drive sales and drive employment, we really need 2.5 percent to 3 percent. We haven't had that," Oberhelman said. "I've been through many cycles in my 40 years at Caterpillar and it will turn [around] at some point."
Continuing economic weakness in China and Brazil and uncertainty over Greece haven't helped confidence, Caterpillar said in its earnings statement.
As for China, Oberhelman told CNBC, "I think they're closer to the bottom."
Read MoreUS existing home sales near 8½-year high
On Wednesday, Caterpillar released its retail sales numbers for June. The numbers showed that machine retail sales were down 14 percent across all of the company's markets. That metric has come in above 10 percent each month in 2015.
Shares of Caterpillar have tumbled close to 28 percent over the last 12 months.
Correction: This version deleted an incorrect reference to a previous stock buyback.