Summary
Deere & Company (DE) reported a decrease in net sales and net income for the second quarter and first six months of fiscal year 2024 compared to the same periods in 2023. Net sales for the quarter fell 12% to $15.2 billion, and net income attributable to Deere & Company decreased by 17% to $2.37 billion. Diluted earnings per share were $8.53, down from $9.65 in the prior year's quarter. This decline is attributed primarily to lower sales volumes across most segments, particularly in Production & Precision Agriculture and Small Agriculture & Turf, reflecting moderated agricultural fundamentals such as lower commodity prices and elevated interest rates. Despite the revenue and profit headwinds, the company's Financial Services segment showed strong revenue growth, up 22% for the quarter, driven by higher average portfolio balances and financing rates. However, this was partially offset by a higher provision for credit losses and less favorable financing spreads. The company ended the period with a solid liquidity position, though it anticipates lower operating cash flows for the remainder of 2024. Deere continues to invest in technology and its Smart Industrial Operating Model, aiming to deliver economic value and sustainability to its customers.
Financial Highlights
39 data points| Revenue | $15.23B |
| R&D Expenses | $565.00M |
| SG&A Expenses | $1.26B |
| Operating Expenses | $12.12B |
| Interest Expense | $836.00M |
| Net Income | $2.37B |
| EPS (Basic) | $8.56 |
| EPS (Diluted) | $8.53 |
| Shares Outstanding (Basic) | 276.80M |
| Shares Outstanding (Diluted) | 277.90M |
Key Highlights
- 1Net sales decreased by 12% to $15.2 billion for the second quarter of fiscal year 2024, compared to $17.4 billion in the prior year, primarily due to lower sales volumes.
- 2Net income attributable to Deere & Company declined 17% to $2.37 billion ($8.53 per diluted share) for the second quarter of fiscal year 2024, down from $2.86 billion ($9.65 per diluted share) in the prior year's quarter.
- 3The Production & Precision Agriculture segment saw a 16% decrease in net sales to $6.58 billion, driven by lower shipment volumes, especially in Brazil, the U.S., and Europe, reflecting softened demand.
- 4The Small Agriculture & Turf segment's net sales decreased by 23% to $3.19 billion, also attributed to lower shipment volumes and softened demand in key markets.
- 5Financial Services segment revenue increased by 22% to $1.59 billion, driven by higher average portfolio balances and financing rates, although net income for the segment rose 479% to $162 million.
- 6The company's outlook for fiscal year 2024 anticipates continued production volume declines for agricultural equipment due to shifting demand and moderating agricultural fundamentals.
- 7Deere maintained a strong liquidity position, with cash, cash equivalents, and marketable securities totaling $6.65 billion at the end of the period, and unused credit lines of $2.79 billion.