Industrial machinery manufacturer Caterpillar on Tuesday reported a 54% drop in earnings in the third quarter as equipment sales declined across all regions and segments.
The Dow component posted better-than-expected 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, according to Refinitiv.
Caterpillar said the sales 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 slipped 2.5% in Tuesday's premarket 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," Chairman and CEO Jim Umpleby said in a statement. "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.
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