Caterpillar and United Airlines released their third quarter earnings reports before opening bell this morning. Caterpillar posted adjusted earnings of 75 cents, missing the FactSet consensus estimate of 78 cents per share. Revenue was $11 billion, also missing the consensus estimate of $11.2 billion.
United Airlines reported adjusted earnings of $4.53 per share, coming up short of the analyst estimate of $4.55 per share. Revenue was $10.3 billion, which was in line with Wall Street’s estimate.
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Caterpillar revenues decline 19%
Caterpillar’s reported earnings were 62 cents, compared to last year’s $1.63 per share.
“The environment remains extremely challenging for most of the key industries we serve, with sales and revenues down 19 percent from the third quarter last year,” said Caterpillar Chairman and CEO Doug Oberhelman in a statement. “Improving how we operate is our focus amidst the continued weakness in mining and oil and gas. We’re tackling costs, and our year-to-date decremental profit pull through has been better than our target.”
Caterpillar management also cut their guidance for this year. They left their revenue guidance the same as their September 24 announcement at around $48 billion but cut their profit guide to $4.60 per share on a non-GAAP basis or $3.70 per share on a GAAP basis. Consensus estimates for the full year suggest $47.8 billion in revenue and earnings of $4.60 per share. The previous guide was provided in July and suggested profits of $4.70 to $5 per share, excluding restructuring costs.
Caterpillar said its expectations for restructuring-related costs was much higher than previously expected, rising to about $800 million from $250 million previously. In July, management had guided for about $49 billion in revenue.
As of this writing, shares of Caterpillar were down 3.14% at $67.45 per share.
United Airlines’ revenue falls
United Airlines said revenue fell 2.4% year over year. The airline’s operating expenses fell 10.3% year over year driven by falling oil prices and solid non-fuel cost performance. Passenger revenue fell 3.8% to $8.96 billion, while cargo revenue fell 0.8% to $235 million.
The airline generated $627 million in free cash flow and $1.3 billion in operating cash flow. United Airlines continued to spend on capital expenditures, including buying new aircraft, refurbishing aircraft, and investing in its hubs in Chicago, Houston, New York/ Newark, and San Francisco.
As of this writing, shares of United Airlines were down 1.41% at $53.74 per share.