Caterpillar reported a surge in fourth-quarter revenue, exceeding Wall Street expectations. This positive performance stems from the growing demand for its energy equipment, fueled by the boom in artificial intelligence. The company's stock has risen over 65% in the past year, reflecting investor enthusiasm for the AI-related growth prospects.

Total sales in Caterpillar's power and energy segment reached $9.4 billion, a 23% increase year-over-year. The unit's profits also climbed by 25% to $1.84 billion. The demand is largely driven by the need for power-generation systems in data centers supporting the latest AI models.

Group-wide revenue increased by 18% to $19.13 billion, surpassing estimates. Adjusted per-share income also rose. CEO Joe Creed cited the strength of end markets and disciplined execution, adding that the record backlog positions Caterpillar with strong momentum in 2026.

Investors are closely watching how Caterpillar navigates the evolving energy landscape. The company's heavy equipment is vital for infrastructure projects, including those supporting energy initiatives. With the AI sector's continued expansion, the demand for its products is expected to remain high.