01—Abstract
Summary
Summary of the 10-K filed December 18, 2025. Cited figures are marked; the original filing is the authoritative source.
Deere & Company's fiscal 2025 results (year ended November 2, 2025, a 53-week year) reflect a sharp downturn in its equipment markets.
Consolidated net sales and revenues fell 12% to $45.7 billiona, and net income attributable to Deere declined to $5.0 billion from $7.1 billion, with diluted EPS of $18.50 versus $25.62. The decline was driven by lower sales volumes in large agriculture in North America, weaker construction and forestry demand, roughly $600 million of direct incremental tariff costs, and higher allowances for credit losses in agriculture and turf receivables. Equipment operations operating margins compressed across all three segments, with Production & Precision Agriculture falling to 15.4% from 21.7%, Small Agriculture & Turf to 11.8%, and Construction & Forestry to 9.0%.
Financial Services net income rose 28% to $890 millionb, helped by special items, lower SG&A, and better financing spreads, although the deconsolidation of Banco John Deere in Brazil reduced the receivables base. Liquidity remains strong: cash and marketable securities total about $9.7 billion, the company generated $7.5 billion in operating cash flow, and it returned $2.8 billion less to shareholders than in 2024 by cutting buybacks. Management forecasts lower equipment operations operating cash flow in 2026, a further decline in large ag in North America, and modest improvement in small ag and turf and construction.
Pending legal risk includes an FTC and state attorneys general antitrust suit over right-to-repair, for which management is in preliminary settlement discussions and has not estimated an impact. For investors, the central questions are how long the agricultural cycle persists, whether tariff relief from the Supreme Court IEEPA case materializes, and whether the right-to-repair litigation leads to operating or financial constraints. The company maintains A-range credit ratings from all three agencies with stable outlooks, and it declared a quarterly dividend of $1.62c per share for early 2026.
02—Key points
Key Highlights
- Net sales and revenues declined 12% to $45.7 billion; net sales from equipment operations fell 13% to $38.9 billion, driven by lower volumes in North America large ag and construction.
- Net income attributable to Deere fell 29% to $5.0 billion, and diluted EPS fell to $18.50 from $25.62.
- Equipment operations margins compressed sharply: PPA operating margin 15.4% (vs. 21.7%), SAT 11.8% (vs. 14.8%), and CF 9.0% (vs. 15.5%), with incremental tariffs of about $600 million a major headwind.
- Financial Services net income rose 28% to $890 million, supported by special items, lower SG&A, and favorable financing spreads, despite a higher allowance for credit losses on agriculture and turf accounts.
- Operating cash flow was $7.5 billion, and share repurchases dropped to $1.1 billion from $4.0 billion; $7.9 billion remains under the $18 billion authorization.
- Management guides to lower large ag sales in North America and lower equipment operating cash flow in 2026, while expecting modest improvement in small ag, turf, and construction.
- The FTC and several state attorneys general antitrust suit over repair access is ongoing; the company is in preliminary resolution talks and has not estimated financial impact, and a class action accrual was increased by $95 million in Q4.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2025filed December 18, 2025Financial Statements
FY2025 against FY2024
| Line item | FY2025FY2024 | Change |
|---|---|---|
| Revenue | $45.68B$51.72B | −11.7% |
| R&D Expenses | $2.31B$2.29B | +0.9% |
| SG&A Expenses | $4.66B$4.84B | −3.7% |
| Operating Expenses | $39.43B$42.51B | −7.3% |
| Interest Expense | $3.17B$3.35B | −5.3% |
| Net Income | $5.03B$7.10B | −29.2% |
| EPS (Basic) | $18.55$25.73 | −27.9% |
| EPS (Diluted) | $18.50$25.62 | −27.8% |
| Shares Outstanding (Basic) | 270.90M276.00M | −1.8% |
| Shares Outstanding (Diluted) | 271.70M277.10M | −1.9% |
05—Questions
Frequently Asked Questions
Why did Deere's earnings decline so much in fiscal 2025?
Lower sales volumes from a weak agricultural cycle and softer construction demand reduced equipment operations net sales by 13%. Operating margins also fell because of incremental tariffs (about $600 million in direct costs), higher overhead from production inefficiencies at lower volumes, and weaker price realization in construction and forestry. Net income attributable to Deere declined 29% to $5.0 billion.
Is Deere's balance sheet and liquidity under pressure?
Not materially. The company held $8.3 billion of cash and equivalents and $1.4 billion of marketable securities, generated $7.5 billion of operating cash flow, and maintained A/A1/A+ ratings with stable outlooks. Its financing business still carries large borrowings, mostly matched to its receivable and lease portfolios, and management expects to refinance maturities with new debt, with the portfolio expected to shrink in 2026.
What are the biggest risks for investors going forward?
The main risks are a prolonged downturn in North American large agriculture as row-crop farm finances stay strained, rising credit losses in agriculture and turf receivables, continued tariff costs and retaliatory trade measures, and the outcome of the FTC right-to-repair antitrust suit, which could require changes to repair access policies. The company also flags slower-than-expected adoption of its precision technology and SaaS subscriptions.
Will Deere keep returning cash to shareholders?
The company expects to keep paying quarterly dividends, having declared $1.62 per share payable in February 2026, with 2026 dividends subject to board discretion. Share repurchases were cut sharply in 2025 and will be considered only after capital requirements are met, so buybacks are likely to remain well below prior levels while the cycle is weak.
Could tariff relief change the outlook?
Possibly. The U.S. Supreme Court heard arguments on IEEPA-based tariffs in November 2025, and a ruling could provide relief and potential recovery of amounts already paid. Management is monitoring the case, but it has not assumed any relief in its outlook, and tariffs remain a cost headwind given that about 20% of domestic sales are imported.
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