UNITED STATES

SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549

FORM  8-K

Current Report

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):                  October 27, 2022

CATERPILLAR INC.

(Exact name of registrant as specified in its charter)

Delaware                                           1-768                                           37-0602744

(State or other jurisdiction of incorporation)

(Commission File

Number)

(I.R.S Employer Identification No.)

510 Lake Cook Road,  Suite 100,   Deerfield,   Illinois   60015

(Address of principal executive offices)                             (Zip Code) Registrant’s telephone number, including area code:          (224)  551-4000

Former name or former address, if changed since last report: N/A

☐      Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐      Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐      Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐      Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Securities registered pursuant to Section 12(b) of the Act:

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Indicate by check mark whether the registrant is an emerging growth company as defined by Rule 405 of the Securities Act of

1933 (17 CFR §230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2 of this chapter).

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period

for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange   ☐

Act.

Item 2.02.  Results of Operations and Financial Condition.

On October 27, 2022, Caterpillar Inc. issued a press release reporting its financial results for the quarter ended

September 30, 2022.  A copy of the press release is attached hereto as Exhibit 99.1 and incorporated into this Item

2.02 by reference.

Item 7.01. Regulation FD Disclosure.

Caterpillar Inc. is furnishing supplemental information concerning (i) retail sales of machines to end users and (ii)

retail sales of power systems (including reciprocating and turbine engines and locomotives) to end users and Original Equipment Manufacturers ("OEMs"). This supplemental information is attached hereto as Exhibit 99.2 and incorporated into this Item 7.01 by reference.

The information in this Current Report on Form 8-K, including Exhibit 99.1, is being furnished in accordance with the provisions of General Instruction B.2 of Form 8-K.

Item 9.01.  Financial Statements and Exhibits.

(d)      Exhibits:

The following is furnished as an exhibit to this report:

99.1      Caterpillar Inc. press release dated October 27, 2022

99.2      Retail Statistics

104       The cover page from this Current Report on Form 8-K, formatted in Inline XBRL.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

CATERPILLAR INC.

October 27, 2022                                                                  By:      /s/ Suzette M. Long

Suzette M. Long

Chief Legal Officer and General Counsel

Caterpillar Inc.

3Q 2022 Earnings Release

Exhibit 99.1

October 27, 2022

FOR IMMEDIATE RELEASE

Caterpillar Reports Third-Quarter 2022 Results

●   Third-quarter 2022 sales and revenues increased

21% to $15.0 billion

●   Third-quarter 2022 profit per share of $3.87;

adjusted profit per share of $3.95

●   Returned $2.0 billion to shareholders through share repurchases and dividends in the quarter

IRVING, Texas – Caterpillar Inc. (NYSE: CAT) announced third-quarter 2022 sales and revenues of $15.0 billion, a

21% increase compared with $12.4 billion in the third quarter of 2021. The increase was primarily due to favorable price realization and higher sales volume.

Operating profit margin was 16.2% for the third quarter of 2022, compared with 13.4% for the third quarter of 2021. Third-quarter 2022 profit per share was $3.87, compared with third-quarter 2021 profit per share of $2.60. Adjusted profit per share in the third quarter of 2022 was $3.95, compared with third-quarter 2021 adjusted profit per share of

$2.66. Adjusted profit per share for both quarters excluded restructuring costs. Please see a reconciliation of GAAP

to non-GAAP financial measures in the appendix on page 13.

For the nine months ended September 30, 2022, enterprise operating cash flow was $5.0 billion, and the company ended the third quarter with $6.3 billion of enterprise cash. In the quarter, the company repurchased $1.4 billion of Caterpillar common stock and paid dividends of $0.6 billion.

“I’d like to thank our global Caterpillar team for delivering another quarter of double-digit top-line growth and record adjusted profit per share,” said Chairman and CEO Jim Umpleby. “Our team remains focused on serving our customers as we continued to see healthy demand across most of our end markets during the third quarter.”

CONSOLIDATED RESULTS

Consolidated Sales and Revenues

The chart above graphically illustrates reasons for the change in consolidated sales and revenues between the third quarter of 2021 (at left) and the third quarter of 2022 (at right). Caterpillar management utilizes these charts internally to visually communicate with the company’s Board of Directors and employees.

Total sales and revenues for the third quarter of 2022 were $14.994 billion, an increase of $2.597 billion, or 21%, compared with $12.397 billion in the third quarter of 2021. The increase was due to favorable price realization and higher sales volume, partially offset by unfavorable currency impacts primarily related to the euro, Japanese yen and Australian dollar. The increase in sales volume was driven by the impact from changes in dealer inventories, higher sales of equipment to end users and higher services. Dealers increased inventories by $700 million during the third quarter of 2022, compared with a decrease of $300 million during the third quarter of 2021.

Sales were higher across the three primary segments.

Sales and Revenues by Segment

Sales and Revenues by Geographic Region

Consolidated Operating Profit

The chart above graphically illustrates reasons for the change in consolidated operating profit between the third quarter of 2021 (at left) and the third quarter of 2022 (at right). Caterpillar management utilizes these charts internally to visually communicate with the company’s Board of Directors and employees. The bar titled Other includes consolidating adjustments and Machinery, Energy & Transportation’s other operating (income) expenses.

Operating profit for the third quarter of 2022 was $2.425 billion, an increase of $761 million, or 46%, compared with

$1.664 billion in the third quarter of 2021. The increase was primarily due to favorable price realization and higher sales volume, partially offset by higher manufacturing costs and higher selling, general and administrative (SG&A) and research and development (R&D) expenses. Unfavorable manufacturing costs largely reflected higher material costs, freight and the impact of manufacturing inefficiencies. SG&A/R&D expenses increased primarily due to investments aligned with the company's strategy for profitable growth and higher short-term incentive compensation expense.

Corporate Items and Eliminations included corporate-level expenses, timing differences (as some expenses are reported in segment profit on a cash basis), methodology differences between segment and consolidated external reporting (the company values segment inventories and cost of sales using a current cost methodology), certain restructuring costs and inter-segment eliminations.

Other Profit/Loss and Tax Items

•     Other income (expense) in the third quarter of 2022 was income of $242 million, compared with income of

$225 million in the third quarter of 2021. The change was primarily driven by favorable impacts from foreign currency exchange and higher investment and interest income, partially offset by lower gains on marketable securities and lower pension and other postemployment benefit (OPEB) plan income.

• The provision for income taxes for the third quarter of 2022 reflected an estimated annual global tax rate of approximately 23%, compared with 25% for the third quarter of 2021, excluding the discrete items discussed below. The comparative tax rate for full-year 2021 was 23%.

In the third quarter of 2022, the company reached a settlement with the U.S. Internal Revenue Service (IRS) that resolves all issues for tax years 2007 through 2016, without any penalties. The company’s settlement includes, among other issues, the resolution of disputed tax treatment of profits earned by Caterpillar SARL (CSARL) from certain parts transactions. The company vigorously contested the IRS’s application of the “substance-over-form” or “assignment-of-income” judicial doctrines and its proposed increases to tax and imposition of accuracy related penalties. The settlement does not include any increases to tax in the United States based on those judicial doctrines and does not include any penalties. The final tax assessed by the IRS for all issues under the settlement was $490 million for the ten-year period. This amount was primarily paid in the third quarter of 2022, and the associated estimated interest of

$250 million is expected to be paid by the end of 2022. The settlement was within the total amount of gross unrecognized tax benefits for uncertain tax positions and enables us to avoid the costs and burdens of further disputes with the IRS. As a result of the settlement, the company recorded a discrete tax benefit of

$41 million to reflect changes in estimates of prior years’ taxes and related interest, net of tax. The company is subject to the continuous examination of our income tax returns by the IRS, and tax years subsequent to 2016 are not yet under examination.

The provision for income taxes in third quarter of 2022 also included a $20 million benefit due to a decrease in the estimated annual tax rate, compared to $39 million in the third quarter of 2021. The company also recorded a discrete tax benefit of $36 million to reflect changes in estimates related to the prior year’s U.S. taxes in the third quarter of 2021.

CONSTRUCTION INDUSTRIES

Construction Industries’ total sales were $6.276 billion in the third quarter of 2022, an increase of $1.021 billion, or

19%, compared with $5.255 billion in the third quarter of 2021. The increase was due to favorable price realization and higher sales volume, partially offset by unfavorable currency impacts primarily related to the euro, Japanese yen and Australian dollar. The increase in sales volume was driven by the impact from changes in dealer inventories. Dealer inventory increased during the third quarter of 2022, compared with a decrease during the third quarter of 2021.

▪ In North America, sales increased due to favorable price realization and higher sales volume. Higher sales volume was driven by the impact from changes in dealer inventories. Dealer inventory decreased during the third quarter of 2021, compared with an increase during the third quarter of 2022.

▪     Sales increased in Latin America primarily due to higher sales volume and favorable price realization.

Higher sales volume was driven by higher sales of equipment to end users and the impact from changes in dealer inventories. Dealer inventory increased more during the third quarter of 2022 than during the third quarter of 2021.

▪ In EAME, sales were about flat. Unfavorable currency impacts, primarily related to the euro, were offset by favorable price realization.

▪ Sales were about flat in Asia/Pacific. Favorable price realization was offset by unfavorable currency impacts, primarily related to the Japanese yen and Australian dollar.

Construction Industries’ profit was $1.209 billion in the third quarter of 2022, an increase of $343 million, or 40%, compared with $866 million in the third quarter of 2021. The increase was mainly due to favorable price realization and higher sales volume, partially offset by unfavorable manufacturing costs and higher SG&A/R&D expenses. Unfavorable manufacturing costs largely reflected higher material costs, freight and the impact of manufacturing inefficiencies. The increase in SG&A/R&D expenses was primarily driven by investments aligned with strategic initiatives and higher short-term incentive compensation expense.

RESOURCE INDUSTRIES

(Millions of dollars)

Segment Sales

Resource Industries’ total sales were $3.087 billion in the third quarter of 2022, an increase of $721 million, or 30%, compared with $2.366 billion in the third quarter of 2021. The increase was primarily due to favorable price realization and higher sales volume. The increase in sales volume was due to the impact of changes in dealer inventories, higher sales of aftermarket parts and higher sales of equipment to end users. Dealer inventory decreased during the third quarter of 2021, compared with an increase during the third quarter of 2022.

Resource Industries’ profit was $506 million in the third quarter of 2022, an increase of $226 million, or 81%, compared with $280 million in the third quarter of 2021. The increase was mainly due to favorable price realization and higher sales volume, partially offset by unfavorable manufacturing costs and higher SG&A/R&D expenses. Unfavorable manufacturing costs largely reflected higher material costs, freight and the impact of manufacturing inefficiencies. The increase in SG&A/R&D expenses was primarily driven by investments aligned with strategic initiatives.

ENERGY & TRANSPORTATION

Quarter 2022

Quarter 2021

Change

Change

Energy & Transportation’s total sales were $6.186 billion in the third quarter of 2022, an increase of $1.109 billion, or 22%, compared with $5.077 billion in the third quarter of 2021. Sales increased across all applications and inter- segment sales. The increase in sales was primarily due to higher sales volume and favorable price realization, partially offset by unfavorable currency impacts.

▪ Oil and Gas – Sales increased due to higher sales of reciprocating engine aftermarket parts and engines used in gas compression and well servicing applications.

▪ Power Generation – Sales increased in large reciprocating engines, primarily data center applications, and small reciprocating engines. Turbines and turbine-related services increased as well.

▪     Industrial – Sales were up across all regions.

▪     Transportation – Sales increased in reciprocating engine aftermarket parts and marine applications.

International locomotive deliveries were also higher.

Energy & Transportation’s profit was $935 million in the third quarter of 2022, an increase of $229 million, or 32%, compared with $706 million in the third quarter of 2021. The increase was driven by favorable price realization and higher sales volume, partially offset by unfavorable manufacturing costs and higher SG&A/R&D expenses. Unfavorable manufacturing costs largely reflected higher material costs, freight and the impact of manufacturing inefficiencies. The increase in SG&A/R&D expenses was primarily driven by investments aligned with strategic initiatives, higher labor-related costs and higher short-term incentive compensation expense.

FINANCIAL PRODUCTS SEGMENT

(Millions of dollars)

Revenues by Geographic Region

Financial Products’ segment revenues were $819 million in the third quarter of 2022, an increase of $57 million, or

7%, compared with $762 million in the third quarter of 2021. The increase was primarily due to higher average financing rates in North America and Latin America.

Financial Products’ segment profit was $220 million in the third quarter of 2022, an increase of $47 million, or 27%, compared with $173 million in the third quarter of 2021. The increase was mainly due to a favorable impact from a lower provision for credit losses at Cat Financial, partially offset by mark-to-market adjustments on derivative contracts.

At the end of the third quarter of 2022, past dues at Cat Financial were 2.00%, compared with 2.41% at the end of the third quarter of 2021. Past dues decreased across all our portfolio segments, with the exception of an increase in Latin America. Write-offs, net of recoveries, were $13 million for the third quarter of 2022, compared with $76 million for the third quarter of 2021. As of September 30, 2022, Cat Financial's allowance for credit losses totaled

$339 million, or 1.30% of finance receivables, compared with $376 million, or 1.41% of finance receivables, at June

30, 2022. The allowance for credit losses at year-end 2021 was $337 million, or 1.22% of finance receivables.

Corporate Items and Eliminations

Expense for corporate items and eliminations was $343 million in the third quarter of 2022, an increase of $50 million from the third quarter of 2021, primarily driven by increased expenses due to timing differences, partially offset by favorable impacts of segment reporting methodology differences and lower corporate costs.

Notes

i.     Glossary of terms is included on the Caterpillar website at https://investors.caterpillar.com/overview/default.aspx.

ii.    Sales of equipment to end users is demonstrated by the company’s Rolling 3 Month Retail Sales Statistics filed in a Form

8-K on Thursday, October 27, 2022.

iii.   Information on non-GAAP financial measures is included in the appendix on page 13.

iv.   Some amounts within this report are rounded to the millions or billions and may not add.

v.    Caterpillar will conduct a teleconference and live webcast, with a slide presentation, beginning at 7:30 a.m. Central Time on Thursday, October 27, 2022, to discuss its 2022 third-quarter results. The accompanying slides will be available before the webcast on the Caterpillar website at https://investors.caterpillar.com/events-presentations/default.aspx.

About Caterpillar

With 2021 sales and revenues of $51.0 billion, Caterpillar Inc. is the world’s leading manufacturer of construction and mining equipment, off-highway diesel and natural gas engines, industrial gas turbines and diesel-electric locomotives. For nearly 100 years, we’ve been helping customers build a better, more sustainable world and are committed and contributing to a reduced-carbon future. Our innovative products and services, backed by our global dealer network, provide exceptional value that helps customers succeed. Caterpillar does business on every continent, principally operating through three primary segments – Construction Industries, Resource Industries and Energy & Transportation – and providing financing and related services through our Financial Products segment. Visit us at caterpillar.com or join the conversation on our social media channels at caterpillar.com/en/news/social-media.html.

Caterpillar’s latest financial results are also available online:

https://investors.caterpillar.com/overview/default.aspx

https://investors.caterpillar.com/financials/quarterly-results/default.aspx (live broadcast/replays of quarterly conference call) Caterpillar investor relations contact: Ryan Fiedler, +1 224-551-4074 or Fiedler_Ryan_S@cat.com

Caterpillar media contact: Rachel Potts, +1 309-573-3444 or Potts_Rachel_A@cat.com

Forward-Looking Statements

Certain statements in this press release relate to future events and expectations and are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “believe,” “estimate,” “will be,” “will,” “would,” “expect,” “anticipate,” “plan,” “forecast,” “target,” “guide,” “project,” “intend,” “could,” “should” or other similar words or expressions often identify forward-looking statements. All statements other than statements of historical fact are forward-looking statements, including, without limitation, statements regarding our outlook, projections, forecasts or trend descriptions. These statements do not guarantee future performance and speak only as of the date they are made, and we do not undertake to update our forward-looking statements.

Caterpillar’s actual results may differ materially from those described or implied in our forward-looking statements based on a number of factors, including, but not limited to: (i) global and regional economic conditions and economic conditions in the industries we serve; (ii) commodity price changes, material price increases, fluctuations in demand for our products or significant shortages of material; (iii) government monetary or fiscal policies; (iv) political and economic risks, commercial instability and events beyond our control in the countries in which we operate; (v) international trade policies and their impact on demand for our products and our competitive position, including the imposition of new tariffs or changes in existing tariff rates; (vi) our ability to develop, produce and market quality products that meet our customers’ needs; (vii) the impact of the highly competitive environment in which we operate on our sales and pricing; (viii) information technology security threats and computer crime; (ix) inventory management decisions and sourcing practices of our dealers and our OEM customers; (x) a failure to realize, or a delay in realizing, all of the anticipated benefits of our acquisitions, joint ventures or divestitures; (xi) union disputes or other employee relations issues; (xii) adverse effects of unexpected events; (xiii) disruptions or volatility in global financial markets limiting our sources of liquidity or the liquidity of our customers, dealers and suppliers; (xiv) failure to maintain our credit ratings and potential resulting increases to our cost of borrowing and adverse effects on our cost of funds, liquidity, competitive position and access to capital markets; (xv) our Financial Products segment’s risks associated with the financial services industry; (xvi) changes in interest rates or market liquidity conditions; (xvii) an increase in delinquencies, repossessions or net losses of Cat Financial’s customers; (xviii) currency fluctuations; (xix) our or Cat Financial’s compliance with financial and other restrictive covenants in debt agreements; (xx) increased pension plan funding obligations; (xxi) alleged or actual violations of trade or anti-corruption laws and regulations; (xxii) additional tax expense or exposure, including the impact of U.S. tax reform; (xxiii) significant legal proceedings, claims, lawsuits or government investigations; (xxiv) new regulations or changes in financial services regulations; (xxv) compliance with environmental laws and regulations; (xxvi) the duration and geographic spread of, business disruptions caused by, and the overall global

economic impact of, the COVID-19 pandemic; and (xxvii) other factors described in more detail in Caterpillar’s Forms 10-Q, 10-K and other filings with the Securities and Exchange Commission.

NON-GAAP FINANCIAL MEASURES

APPENDIX

The following definitions are provided for the non-GAAP financial measures. These non-GAAP financial measures have no standardized meaning prescribed by U.S. GAAP and therefore are unlikely to be comparable to the calculation of similar measures for other companies. Management does not intend these items to be considered in isolation or as a substitute for the related GAAP measures.

The company believes it is important to separately quantify the profit impact of one significant item in order for the company’s results to be meaningful to readers. This item consists of (i) restructuring costs, which were incurred to generate longer-term benefits. The company does not consider this item indicative of earnings from ongoing business activities and believes the non-GAAP measure provides investors with useful perspective on underlying business results and trends and aids with assessing the company’s period-over-period results. The company

intends to discuss adjusted profit per share for the fourth quarter and full-year 2022, excluding mark-to-market gains or losses for remeasurement of pension and other postemployment benefit plans along with any other discrete

items.

Reconciliations of adjusted results to the most directly comparable GAAP measure are as follows:

Provision

(Dollars in millions except per share data)

Operating

Profit

Operating Profit Margin

Profit Before Taxes

(Benefit) for Income Taxes

Effective

Tax Rate            Profit

Profit per

Share

Three Months Ended September 30, 2022 - U.S. GAAP        $         2,425              16.2 %   $         2,558    $            527              20.6 %   $         2,041    $           3.87

Restructuring costs                                                                              49                0.3 %                   49                       9              18.4 %                   40    $           0.08

Three Months Ended September 30, 2022 - Adjusted               $         2,474              16.5 %   $         2,607    $            536              20.6 %   $         2,081    $           3.95

Three Months Ended September 30, 2021 - U.S. GAAP        $         1,664              13.4 %   $         1,775    $            368              20.7 %   $         1,426    $           2.60

Restructuring costs                                                                              35                0.3 %                   35                       6              15.0 %                   29    $           0.06

Three Months Ended September 30, 2021 - Adjusted               $         1,699              13.7 %   $         1,810    $            374              20.7 %   $         1,455    $           2.66

Supplemental Consolidating Data

The company is providing supplemental consolidating data for the purpose of additional analysis. The data has been grouped as follows:

Consolidated – Caterpillar Inc. and its subsidiaries.

Machinery,  Energy  &  Transportation  (ME&T)  –  The  company  defines  ME&T  as  it  is  presented  in  the supplemental data as Caterpillar Inc. and its subsidiaries, excluding Financial Products. ME&T’s information relates to the design, manufacturing and marketing of its products.

Financial Products – The company defines Financial Products as it is presented in the supplemental data as its finance and insurance subsidiaries, primarily Caterpillar Financial Services Corporation (Cat Financial) and Caterpillar Insurance Holdings Inc. (Insurance Services). Financial Products’ information relates to the financing to customers and dealers for the purchase and lease of Caterpillar and other equipment.

Consolidating Adjustments – Eliminations of transactions between ME&T and Financial Products.

The nature of the ME&T and Financial Products businesses is different, especially with regard to the financial position and cash flow items. Caterpillar management utilizes this presentation internally to highlight these differences. The company believes this presentation will assist readers in understanding its business.

Pages 14 to 24 reconcile ME&T and Financial Products to Caterpillar Inc. consolidated financial information.

Condensed Consolidated Statement of Results of Operations

(Unaudited)

(Dollars in millions except per share data)

Three Months Ended

September 30,

Nine Months Ended

September 30,

Sales and revenues:

2022              2021                    2022              2021

Sales of Machinery, Energy & Transportation

Operating costs:

1   Profit attributable to common shareholders.

2   Diluted by assumed exercise of stock-based compensation awards using the treasury stock method.

Condensed Consolidated Statement of Financial Position

(Unaudited) (Millions of dollars)

Caterpillar Inc.

Condensed Consolidated Statement of Cash Flow

(Unaudited) (Millions of dollars)

Cash flow from operating activities:

Nine Months Ended

September 30,

2022                    2021

Profit of consolidated and affiliated companies