Summary
Deere & Company (DE) reported a significant year-over-year decrease in net sales and revenues for the fiscal first quarter ended January 25, 2025, falling to $8.51 billion from $12.19 billion in the prior year. This decline was primarily driven by lower sales volumes across its Production & Precision Agriculture, Small Agriculture & Turf, and Construction & Forestry segments, reflecting market uncertainty, high interest rates, and elevated used equipment inventory. Consequently, net income attributable to Deere & Company more than halved, dropping to $869 million ($3.19 per diluted share) from $1.75 billion ($6.23 per diluted share) in the comparable period. Despite the revenue and profit decline, the company's Financial Services segment showed a modest revenue increase and improved net income, aided by a reduction in the valuation allowance for assets held for sale related to Banco John Deere S.A. (BJD). The company is navigating a challenging market environment characterized by softening demand in key agricultural and construction sectors, alongside persistent interest rate headwinds. Management remains focused on its Smart Industrial Operating Model and Leap Ambitions to capitalize on technological integration, but expects continued sales volume declines and higher credit loss provisions in fiscal year 2025.
Financial Highlights
39 data points| Revenue | $8.51B |
| R&D Expenses | $526.00M |
| SG&A Expenses | $972.00M |
| Operating Expenses | $7.61B |
| Interest Expense | $829.00M |
| Net Income | $869.00M |
| EPS (Basic) | $3.20 |
| EPS (Diluted) | $3.19 |
| Shares Outstanding (Basic) | 271.60M |
| Shares Outstanding (Diluted) | 272.30M |
Key Highlights
- 1Net sales and revenues decreased by 30% to $8.51 billion from $12.19 billion year-over-year, primarily due to lower sales volumes in equipment segments.
- 2Net income attributable to Deere & Company declined by 50% to $869 million ($3.19 per diluted share) from $1.75 billion ($6.23 per diluted share) in the prior year's quarter.
- 3Operating profit for Production & Precision Agriculture, Small Agriculture & Turf, and Construction & Forestry segments saw significant decreases of 68%, 62%, and 89% respectively, driven by lower shipment volumes.
- 4The Financial Services segment reported a 1% revenue increase and an 11% increase in net income, benefiting from a reduction in the valuation allowance for assets held for sale.
- 5The company's outlook for fiscal year 2025 anticipates further sales volume declines due to reduced demand, market uncertainty, and high interest rates.
- 6Despite the challenging outlook, the company's liquidity remains strong with $7.8 billion in cash, cash equivalents, and marketable securities and $7.8 billion in unused credit lines.
- 7Deere is facing a significant antitrust lawsuit from the FTC and several state Attorneys General regarding alleged monopolization and unfair competition related to repair services.