Caterpillar's Order Backlog Hits Record $63 Billion Amid Data Center Boom

Caterpillar's order backlog has reached an all-time high of $63 billion, a record increase of 79% from the same period last year.

The surge in demand is largely driven by data centers, which accounted for a significant portion of Caterpillar's power generation sales growth. The company reported a 41% year-over-year increase in power generation sales to $2.8 billion, with large reciprocating engines and turbines being the primary drivers of this growth.

Caterpillar is responding to the increased demand by expanding its capacity for large reciprocating engine production, nearly tripling it from 2024 levels.

The company's management has expressed confidence in the demand, citing customers committing to longer-term orders with some stretching into 2028. However, the risks associated with a long-dated backlog cannot be ignored, including potential rescheduling or cancellation of orders.