Caterpillar's Data Center Boom Sparks Concern Over Political Backlash

Caterpillar's stock has risen by 48% this year, making it a prime example of companies benefiting from the growing demand for real-world infrastructure driven by hyperscalers. The company's second-quarter sales reached $20.5 billion, up 24% from last year, with operating profit climbing 50% to $4.3 billion.

The construction division, which provides equipment for building data centers, reported a 35% increase in sales to $8.4 billion. Caterpillar's backlog surged to $72.1 billion, a 92% jump from last year, with some orders extending up to 2030.

However, despite its recent earnings beat, not all analysts and investors are optimistic about the company's future. Some have expressed concerns over the emerging hurdle of political backlash against data centers, with 18 out of 50 US states restricting or advancing legislation to restrict their development.