(Bloomberg) -- Caterpillar Inc. is warning investors that it’s now expecting tariffs to have an impact of as much as $1.8 billion on the company this year, higher than its guidance in early August.

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“While the company continues to take initial mitigating actions to reduce this impact, trade and tariff negotiations continue to be fluid,” Caterpillar said Thursday in a regulatory statement.

The company said it expects the net impact from incremental tariffs introduced this year to be $500 million to $600 million in the third quarter, and $1.5 billion to $1.8 billion for the full year.

Caterpillar’s outlook is important because it is one of the world’s biggest makers of machinery for mining and construction. The US manufacturer’s second-quarter results already had reflected the effect of tariffs, with costs coming in at the top end of its estimated range disclosed in April.

Caterpillar said it expects that full-year adjusted operating margin will be near the bottom of its target range.

The annual tariff range is higher than Caterpillar’s Aug. 5 guidance of $1.3 billion to $1.5 billion — which included as much as $500 million in its third quarter.

The revision isn’t expected to affect the company’s sales and revenue outlook provided in August.

Shares of Caterpillar fell as much as 3.6% in after market trading in New York.

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