Deere & Company (NYSE:DE, XETRA:DCO) shares dropped 5.2% Wednesday morning after the farm equipment giant reported stronger-than-expected fourth-quarter earnings but offered a cautious outlook for fiscal 2026.
The company posted Q4 revenue of $12.39 billion, well above analysts’ estimate of $9.82 billion, marking an 11% year-over-year increase.
Earnings per share came in at $3.93, beating the consensus forecast of $3.85. Quarterly net income totaled $1.065 billion, slightly above the $1.05 billion estimate but down 14% from a year earlier.
Segment results were mixed. Production and precision agriculture sales rose 10% to $4.74 billion, while small agriculture and turf equipment sales increased 7% to $2.46 billion. Construction and forestry sales jumped 27% to $3.38 billion, beating estimates of $3.18 billion. Financial services net income surged 69% to $293 million.
Despite the strong quarter, Deere projected net income of $4 billion to $4.75 billion for fiscal 2026, below analysts’ $5.31 billion estimate. The company expects production and precision ag sales to fall 5% to 10% year-over-year, while small ag and turf and construction and forestry segments are anticipated to grow roughly 10% each. Financial services income is forecast at around $830 million.
“This past year brought its share of challenges and uncertainty, but thanks to the structural improvements we’ve made and the diverse customer segments and geographies we serve, we were able to achieve our best results yet for this point in the cycle,” CEO John May said.
“Looking ahead, we believe 2026 will mark the bottom of the large ag cycle.”