Shares in Deere & Company (NYSE:DE, XETRA:DCO), the American agricultural and construction equipment manufacturer, jumped almost 11% on Thursday after the company reported a sharp drop in first-quarter net income despite raising its full-year profit forecast.
Net income fell 25% year on year to $656 million, or $2.42 per share, as higher tariffs and an unfavourable sales mix weighed on profitability, even as total revenues rose 13% to $9.61 billion.
The steepest decline came in the company's core Production & Precision Agriculture division, where operating profit collapsed 59% to $139 million, with operating margin shrinking from 11% to 4.4%.
Bright spots emerged elsewhere, with Construction & Forestry operating profit more than doubling to $137 million and Small Agriculture & Turf posting a 58% rise in operating profit to $196 million, both divisions benefiting from higher shipment volumes.
Despite the headline earnings miss, Deere raised its full-year net income guidance to a range of $4.5 billion to $5 billion.
Chief executive John May said the company believed 2026 represented the bottom of the current agricultural cycle, pointing to recovering demand in construction and small agriculture as a foundation for future growth.