Caterpillar Inc. (NYSE: CAT) who produces heavy industrial equipment reported last Friday the company’s record first-quarter sales and profit. The Peoria, Illinois-based company had seen a 13% rise this past March in its net income.  As well, the company’s overall business is doing very well abroad, despite rising material costs and currency issues with the ever so weak dollar.  The company today has seen an increase around 6% among its share value, which nowadays is a rare feat in the US market.
 
However, as Caterpillar, Inc. is doing very well for itself outside of the US, it has seen a slight trim in both it US and global forecast.  Caterpillar is still bulldozing through the rubble as Caterpillar’s Chief Executive Jim Owens wrote that there is a "robust demand for products used in the global mining and energy industries and for machines used by our customers to build infrastructure, particularly in emerging markets."

"Even though North America, our largest geographic market, is depressed, we are investing for growth," Owens said, adding that the company is "significantly" increasing capital expenditures.  The company, however, has trimmed its forecast for global economic growth to below 3% for 2008.
 
Caterpillar is playing in the sandboxes of Russia, China, and India to benefit their long-term strategies.  Despite the company did see a 3% rise in machinery and engine sales in North America in the first quarter, Caterpillar’s European revenues climbed 30% and Asian business was 37% higher.  Sales outside of North America accounted for 58% of total revenue, versus 53% of the total a year ago.

The Illinois-based group reported net income of $922 million, or $1.45 a share, up from $816 million, or $1.23 a share, a year earlier. Net sales rose 18% to $11.8 billion. The latest mean estimates of analysts polled by Thomson Financial were for earnings of $1.33 a share on revenue of $10.77 billion.  Currently, the company’s shares are trading just under 8% and trading at $84.80, nearing its 52-week high of $87.

Caterpillar still foresees its earnings for 2008 to grow 5% to 15% on revenue increasing 5% to 10%. It lowered its outlook for North America sales, but the company strongly believes that the demands and business abroad are going to hold the company above water, as the rest of the US economy seems to have slowed immensely due to construction zones.

Related Companies
Gehl Company (GEHL)
Deere & Company (DE)
Manitowoc Company, Inc. (MTW)
Astec Industries, Inc. (ASTE)
Terex Corporation (TEX)

Both Continental Airlines (NYSE: CAL) and Southwest Airlines (NYSE: LUV), the two most financially-secured airlines have hit turbulence in the wake of the rising gas prices.  The basic equation shows that as fuel prices sky-rocket, the airlines hit turbulence and will have to ground themselves, if you will.  Southwest has been one of the only airlines to see profits for the last several quarters.  However, the company has finally seen the same turbulence that has been giving other major airline carriers financial problems due to such high fuel costs.

Continental and Southwest Airlines will both attempt to fight the fuel battle by raising prices.  Southwest Airlines Co. which always has deals for travelers for its select domestic locations had to raise its summer prices last week, only then to raise them an additional $10  for flights each way from mid-June through mid-August.  In addition to raising prices, Southwest will have to postpone their plans for fleet expansion.  

The leading low-cost carrier Southwest Airlines Co., headquartered out of Dallas, Texas, has been the only airline company to see a profit this first quarter.  The company’s revenue rose 15.1% to $2.53 billion.  Although the company had reported a profit, they still saw a decline in their numbers as they earned only $34 million, or 5 cents per share, in the first quarter compared with $93 million, or 12 cents per share, a year earlier.

Continental Airlines, the fourth-largest airline carrier by passenger volume, has reported a first-quarter net loss of $80 million, or 81 cents a share, compared with net income of $22 million, or 21 cents a share, a year ago.  Due to the Houston-based company’s large international traffic, Continental’s revenue rose 12% to $3.57 billion.

Continental claims that they will take 14 older, less fuel-efficient aircrafts out of service.

Continental, in addition, will remove 34 of its older fleet of Boeing 737-300’s. Continental’s reduction of their older fleet will reduce the U.S. mainline capacity by 5% this upcoming Fall. “In this fuel environment, we must reduce our domestic capacity to help reduce our losses in the domestic system," said President Jeff Smisek.  Continental and Southwest Airlines will be cutting seat capacity to reduce routes that aren’t providing the airline companies with sufficient funds.  This is a first among U.S. airlines this year to trim domestic capacity even if it cuts their share of the market.

Related Companies
Northwest Airlines Corporation (NWA)
AMR Corporation (AMR)

Google Inc. (NDAQ: GOOG) announced high-than-expected net income of $1.55 billion on $5.19 billion in revenues. The search giant saw a 42% increase in revenue growth compared to the first quarter of 2007 and a 7% increase compared to the fourth quarter of 2007. The strongest growth was seen in international revenues, which finally increased to more than half of its total revenues.

"Our ongoing innovation in search, ads, and apps helped drive healthy growth globally across our product lines, yielding another strong quarter for Google," said Eric Schmidt, CEO of Google. "As we integrate DoubleClick into our advertising platform, we see exciting new ways to improve the user experience and increase value for our advertisers and partners. Also, while exercising operational discipline, we continue to explore opportunities that add value to users everywhere and to Google in the long term."

Google reported that 66% of its revenues were derived from websites that it owns compared to 33% from its content partners. This marks a continued shift towards creating its own revenues, which is much more profitable in the long-run. The search giant also noted that its acquisition of DoubleClick was immaterial to revenue and only slightly dilutive to both GAAP and non-GAAP operating income, net income and earnings per share for the first quarter.

The stock jumped 10% after hours on the news as investors breathed a collective sigh of relief. Many were concerned that the company would post a loss following weakness in pay-per-click advertising predicted by research firm comScore. The huge surprise to the upside has many investors newly bullish on the stock and confident that it will be able to overcome any difficulties in the U.S. economy.

In the end, these factors make GOOG a stock worth watching going into the future. Many are hoping that this news will provide a boost to the technology sector that is already fresh off of good news from IBM.

Related Companies
Microsoft Corporation (MSFT)
Yahoo! Inc. (YHOO)
Time Warner Inc. (TWX)
Oracle Corporation (ORCL)