Caterpillar's stock heads for worst day in 7 years - and what that means for the Dow

By Tomi Kilgore

The business engaged in the data-center build-out is doing well, but broader construction industries disappointed

Caterpillar's data-center business is fine, but other areas disappointed Wall Street, and the stock was heading for its biggest loss in years.

Shares of Caterpillar were suffering a big loss in early Thursday trading, with investors expressing disappointment over a slight miss in third-quarter sales.

That miss wasn't the fault of the company's power and energy business, which has been benefiting from the data center build-out, as sales growth accelerated and prices increased. It was sales from the construction industries business that came up short.

Caterpillar's stock (CAT) was hot during the first half of 2026 and in 2025, as it became part of the artificial-intelligence trade, given its exposure to data centers. But it's been selling off over the past several months, amid worries that the AI build-out was slowing. Through Wednesday, the stock had tumbled 33% since closing at a record high of $1,064.90 on June 30.

And in Thursday's premarket trading, the stock sank 9.6% toward a nine-month low, to put it on track for the biggest single-session percentage decline since March 2009. The implied price decline of more than $68 a share would be the second-biggest in ever, behind the $73.49 drop on July 1.

Because the Dow Jones Industrial Average DJIA is a price-weighted index, and Caterpillar's stock is the index's second-highest priced, the selloff would taking about 406 points off the Dow's price. Ahead of the open, Dow futures (YM00) were down 122 points, or 0.2%.

The company reported third-quarter sales of $20.68 billion, up 17.3% from a year ago but below the consensus analyst expectation of $20.76 billion, according to FactSet. That snapped a five-quarter streak of top-line beats.

Power and energy sales rose 17.7% to $8.78 billion, above the FactSet consensus of $8.22 billion, due to higher sales volume and increased pricing. In the previous quarter, sales had increased 17.1%.

Construction-industries sales rose 18.1% to $7.98 billion, but that missed a consensus expectation of $8.12 billion, FactSet said.

On the bottom line, Caterpillar performed better than expected, as profits jumped 42.9% to $3.29 billion, and as adjusted earnings per share of $7.20 topped expectations of $7.06.

Caterpillar's stock had gained 24.5% in 2026 through Wednesday. That gain is set to be whittled down after the open.

-Tomi Kilgore

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10-29-26 0825ET