<\/p>\n
A Caterpillar Inc. diesel power generator in East Peoria, Illinois.<\/p>\n
(Bloomberg) — Caterpillar Inc., the company synonymous with yellow bulldozers and mining trucks, is getting a boost from another type of machinery.<\/p>\n
Most Read from Bloomberg<\/p>\n
Power generators and turbines, which keep data centers running, have become a dominant driver for the company as demand for artificial-intelligence infrastructure takes off globally. Caterpillar told investors on Wednesday that sales of those products jumped 31% in its latest quarter, trouncing sales growth for its more traditional equipment.<\/p>\n
The stock surged as much as 14%, to a record high.<\/p>\n
It\u2019s an example of how the AI fervor that\u2019s fueled Nvidia Corp.\u2019s rise to become the world\u2019s first $5 trillion company is also lifting the fortunes of more traditional industrial players.<\/p>\n
For instance, shares of ProPetro Holding Corp., a West Texas oil contractor, soared an eye-popping 44% Wednesday after saying it was expanding its business to supply electricity to data centers. It is the biggest single-day jump on record for the company, which has traditionally focused on fracking oil and gas wells.<\/p>\n
Last week, another fracking company, Halliburton Co., announced a deal to provide power to data centers, sending its up 12% for the biggest gain in six months. And a third, Liberty Energy Inc., has gained 60% since saying earlier this month it planned to expand its power generation business. <\/p>\n
For Caterpillar, the boom in data center construction has transformed a once-sleepy segment of its business. Its so-called Energy & Transportation unit, which sells generators and related machinery, used to lag the firm\u2019s other two divisions. But now that unit, which also sells equipment to oil producers and rail services, has become the company\u2019s largest and fast-growing, accounting for about 40% of the firm\u2019s total revenue last year.<\/p>\n
In quarterly earnings on Wednesday, Texas-based Caterpillar said that sales within the unit increased 17% year-over-year. And some analysts are expecting revenue from the unit to double, or even triple, in the coming years.<\/p>\n
It\u2019s \u201ca great illustration of the macroeconomic trends manifesting at the microeconomic level,\u201d said Michael O\u2019Rourke, chief market strategist at JonesTrading. \u201cIt has been well advertised that the AI data center buildouts have been key drivers of GDP growth this year. That comes through in the Caterpillar earnings with the strong demand in its Power Generation business.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"A Caterpillar Inc. diesel power generator in East Peoria, Illinois. (Bloomberg) — Caterpillar Inc., the company synonymous with…\n","protected":false},"author":2,"featured_media":107490,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[365,363,364,902,22014,8558,111,139,69,77362,145,77363],"class_list":{"0":"post-107489","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-artificial-intelligence","8":"tag-ai","9":"tag-artificial-intelligence","10":"tag-artificialintelligence","11":"tag-bloomberg","12":"tag-caterpillar-inc","13":"tag-data-centers","14":"tag-new-zealand","15":"tag-newzealand","16":"tag-nz","17":"tag-power-generators","18":"tag-technology","19":"tag-traditional-equipment"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/107489","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=107489"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/107489\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/107490"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=107489"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=107489"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=107489"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}