Caterpillar's Data Centre Boon Sends Shares Soaring

Caterpillar, an industrial giant known for bulldozers and excavators, saw its shares jump by 12% on its best day in 17 years. The company's second-quarter earnings beat expectations across the board, with revenue reaching a record US$20.54 billion, up 24%. Adjusted earnings came in at US$8.17 a share, surpassing analysts' forecasts of US$6.20.

The driving force behind Caterpillar's success lies in its power and energy business, which saw sales climb 72% in the division that caters to data centres. The company's backlog hit a record US$72.1 billion, up 92% from last year, with some orders extending until 2030.

Chairman and CEO Joe Creed attributed the growth to non-residential investment in critical infrastructure programs, heavy construction, and data centres. He has lifted Caterpillar's long-term growth target to between 6% and 9% a year through 2030 and plans to nearly triple capacity at its large engine plants.