Caterpillar Inc. equipment is on display for sale at a retail site in San Diego, California, U.S., March 3, 2017. REUTERS/Mike Blake/File PhotoRegister now for FREE unlimited access to Reuters.comAug 2 (Reuters) - Caterpillar Inc (CAT.N) sales missed second-quarter expectations on Tuesday as slowing construction activity in China and a halt in Russia operations exacerbated supply-chain problems that have hurt heavy equipment production.Weakness in China, one of its big markets, dented sales at its construction segment, bringing back to focus its April warning that demand for excavators in the world's second largest economy could slip below pre-pandemic levels in 2022. read more Asia-Pacific sales in the unit that caters to the segment fell 17% in the quarter through June, while overall operating margin shrank despite Caterpillar raising prices last year as higher costs related to labor and freight nibbled into profit.Register now for FREE unlimited access to Reuters.comThe industrial bellwether's shares fell 3% in the premarket trading as parts and labor shortages affected its ability to cater to a strong demand in North America and resulted in lower inventory at its dealers.Sales also came under pressure from its suspension of operations in Russia due to Western sanctions on Moscow over its invasion of Ukraine, dragging overall sales in Europe, Africa and Middle East by 3%.Total revenue rose about 11% to $14.25 billion, but missed the analysts' average estimate of $14.35 billion, according to Refinitiv data.While operating margins fell to 13.6% from 13.9% in the same period a year ago, adjusted profit rose to $3.18 per share, above expectations of $3.01 per share, benefiting from higher prices."Price was the standout positive (in Q2)," Jefferies analyst Stephen Volkmann said in a note.Register now for FREE unlimited access to Reuters.comReporting by Abhijith Ganapavaram in Bengaluru; Editing by Arun KoyyurOur Standards: The Thomson Reuters Trust Principles.
Caterpillar sales knocked down by China weakness, Russia halt.