Deere & Company

Q3 headline results (good): Deere delivered resilient profitability despite mixed ag demand - Net sales/revenues up 5% to $12.608B; equipment operations net sales up 6% to $10.999B. - Net income attributable to Deere: $1.379B ($5.10/share). - Equipment operations operating margin: 14.4% (strong execution and above expectations). - Management cited strong factory output, disciplined cost control, favorable price realization, and improving inventory health across the channel.

Segment performance (good + mixed): agriculture earnings pressured by volumes; small ag/turf strengthened - Production & Precision Ag: net sales down 6% to $3.998B (lower shipment volumes; partially offset by +2.5 pts price realization and +1.5 pts currency). Operating profit $527M, margin 13.2% (down YoY due to volumes + higher production costs). - Small Ag & Turf: net sales up 12% to $3.383B (higher volumes; +1.5 pts price; currency slightly negative). Operating profit $622M, margin 18.4% (up YoY from volumes/mix + price, partially offset by higher production costs; also benefited from policy impacts).

2026 full-year outlook by segment (key forecasts; bad news mainly in big ag) - Ag (US/Canada industry outlook): - Large ag equipment: expected down 15–20% YoY (muted farm profitability; elevated input costs/volatility; uncertainty). - Small ag & turf (US/Canada): flat to up 5% (dairy/livestock margins and mowing demand). - Europe: small ag/turf industry ~flat; broader ag equipment softness tied to arable profitability. - South America: equipment outlook down 15–20% (costs + higher interest rates). - Asia: ~flat (stabilizing end markets post modest India improvements). - Deere guidance updates (full-year): - Production & Precision Ag: net sales now ~down 10%; operating margin guide 11–12% (narrowed). - Small Ag & Turf: net sales up ~15%; operating margin raised to 14.5–15.5%. - Construction & Forestry (C&F): net sales up ~20%; operating margin guide 10.5–11.5% (tightened). - WFS (Financial Services): fiscal 2026 net income outlook raised to ~$870M.