Deere & Co. (NYSE:DE) saw its shares shed nearly 5% in pre-market trading after the construction and farming equipment group saw its third-quarter sales miss forecasts, although profits beat.
For the quarter ended July 30, Deere’s net income rose to US$641.8mln, or US$1.97 a share, beating the consensus estimate of US$1.93, and up from US$488.8mln, or US$1.55 a share a year earlier.
But the group’s total revenue increase to US$7.81bn, up from US$6.72bn a year earlier, missed the consensus estimate of US$7.90bn.
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Deere said its agriculture and turf equipment sales rose by 13% to US$5.34bn, below the consensus of US$5.42bn, while a 29% jump in construction and forestry equipment revenue to US$1.50bn matched expectations.
Sales in South America seeing strong gains
The firm said it expects 2017 agriculture and turf sales to rise by about 9% on last year, while construction and forestry sales are projected to increase 15%.
Deere’s chief executive, Samuel Allen said: "We are seeing higher overall demand for our products with farm machinery sales in South America experiencing strong gains and construction equipment sales rising sharply.”
In pre-market trade in New York, Deere shares were down 4.5% at US$118.40.