Caterpillar Inc.’s stock fell Wednesday after the maker of earth-moving equipment said that it’s facing hundreds of millions of dollars in tariff costs in the coming quarter but that it is optimistic the impact will ease over time.

Caterpillar is anticipating a cost headwind of between $250 million and $350 million in the second quarter of 2025 as a result of a global trade war sparked by President Donald Trump.

Caterpillar on Wednesday reported lower-than-expected first-quarter results on weak construction equipment demand and outlined two scenarios for its annual sales forecast, one of which included the potential impact of extensive tariffs.