09:06 AM EDT, 08/05/2025 (MT Newswires) -- Caterpillar's ( CAT ) second-quarter earnings declined more than market estimates year over year, while the heavy equipment manufacturer flagged up to $1.5 billion of costs from incremental tariffs for 2025.

The company on Tuesday reported adjusted earnings of $4.72 a share for the June quarter, down from $5.99 the year before, and below the FactSet-polled consensus of $4.89. Revenue declined to $16.57 billion from $16.69 billion, but topped the Street's view for $16.3 billion. The group attributed the top-line decrease to lower prices.

"The Caterpillar ( CAT ) team remained focused on customer success and demonstrated solid operational performance this quarter," Chief Executive Joe Creed said in a statement. "We continued to see strong orders across our segments as demand remains resilient supported by infrastructure spending and growing energy needs."

In an investor presentation, Caterpillar ( CAT ) said it now anticipates sales and revenue to be "slightly higher" for the ongoing full year versus 2024, compared with its previous projections for the metric to be flat. The company forecasts net incremental tariffs, which are expected to be in place as of Aug. 7, of around $1.3 billion to $1.5 billion, including some mitigation measures and cost controls.

Last week, President Donald Trump signed an executive order modifying the reciprocal tariff rates for certain countries, setting duties in a range of 10% to 41% for several trading partners of the US.

Machinery, energy and transportation revenue ticked down 1% to $15.67 billion in the second quarter. Construction industries and resource industries logged revenue declines of 7% and 4%, respectively, at $6.19 billion and $3.09 billion, amid lower sales volume and prices. Revenue from energy and transportation rose 7% to $7.84 billion.

Caterpillar ( CAT ) expects sales in the current three-month period to "grow moderately," compared with the prior-year quarter, according to the presentation. The Street is looking for sales of $16.01 billion. It also estimates net incremental tariffs of $400 million to $500 million in the third quarter.