10-QPeriod: Q2 FY2026

DEERE & CO Quarterly Report for Q2 Ended May 3, 2026

Filed May 28, 2026For Securities:DE

Summary

Deere & Company (DE) reported its fiscal second quarter 2026 results, indicating a 5% increase in net sales and revenues to $13,369 million compared to the prior year period, driven by higher sales volumes and favorable foreign currency translation. However, net income attributable to Deere & Company saw a slight decrease of 2% to $1,773 million. Diluted earnings per share also declined to $6.55 from $6.64 in the prior year. The company experienced a notable 39% decrease in operating profit for the Production & Precision Agriculture (PPA) segment, largely due to lower shipment volumes and increased production costs, including higher material and freight expenses. Conversely, the Small Agriculture & Turf (SAT) and Construction & Forestry (CF) segments demonstrated strong performance, with SAT's operating profit up 25% and CF's up 48%. The Financial Services segment reported an 11% increase in net income, driven by favorable financing spreads and derivative valuation adjustments, despite a decrease in revenue primarily due to the deconsolidation of Banco John Deere S.A. in the prior year. Looking ahead, Deere & Company anticipates net sales to increase in fiscal year 2026 compared to 2025, with improvements in CF and SAT expected to more than offset a decline in PPA sales. The company continues to focus on its "Leap Ambitions" strategy, emphasizing technology integration and Solutions as a Service. Despite inflationary pressures and ongoing global uncertainties, the company maintains access to global capital markets and expects to meet its funding needs.

Financial Highlights

40 data points
Beta

Revenue

$13.37B

Net Income

$1.77B

13.3% Net Margin

EPS (Diluted)

$6.55

Total Assets

$107.00B

Cash & Equivalents

$7.91B

Free Cash Flow

$1.74B

Financial Statements
Beta
Revenue$13.37B
R&D Expenses$583.00M
SG&A Expenses$1.21B
Operating Expenses$11.08B
Interest Expense$712.00M
Net Income$1.77B
EPS (Basic)$6.57
EPS (Diluted)$6.55
Shares Outstanding (Basic)270.10M
Shares Outstanding (Diluted)270.80M

Key Highlights

  • 1Net sales and revenues increased 5% to $13,369 million for the quarter, and 8% to $22,981 million year-to-date, driven by higher volumes and currency translation.
  • 2Net income attributable to Deere & Company decreased 2% to $1,773 million for the quarter and 9% to $2,429 million year-to-date.
  • 3Production & Precision Agriculture (PPA) segment experienced a significant 39% decrease in operating profit due to lower shipment volumes and higher production costs.
  • 4Small Agriculture & Turf (SAT) segment saw a 25% increase in operating profit, and Construction & Forestry (CF) segment reported a 48% increase, both driven by higher volumes and price realization.
  • 5Financial Services segment's net income increased by 11%, aided by favorable financing spreads and derivative valuation adjustments.
  • 6Inventories increased by $782 million year-to-date, primarily due to seasonal factors.
  • 7The company repurchased $325 million of its common stock during the second quarter of 2026 under its ongoing share repurchase program.

Frequently Asked Questions

The decrease in net income was primarily due to lower shipment volumes in the Production & Precision Agriculture (PPA) segment, which was partially offset by higher shipment volumes in Construction & Forestry (CF) and Small Agriculture & Turf (SAT), favorable price realization, and the positive impact of foreign currency exchange. Additionally, higher production costs from increased material costs and higher warranty expenses also contributed to the decline.

The Construction & Forestry (CF) segment demonstrated strong performance, with net sales increasing 29% in the quarter and 48% in operating profit. This growth was primarily driven by higher shipment volumes, particularly in the U.S., and positive effects from foreign currency translation. Favorable price realization also contributed to the segment's improved profitability.

Deere & Company anticipates that its net sales will increase in fiscal year 2026 compared to 2025. This growth is expected to be driven by anticipated improvements in the Construction & Forestry (CF) and Small Agriculture & Turf (SAT) segments, which are projected to more than offset a predicted decline in the Production & Precision Agriculture (PPA) segment's sales.

Key risks include the agricultural business cycle, macroeconomic conditions (inflation, interest rates, geopolitical instability), global trade policies and tariffs, changes in government policies, climate patterns, supply chain disruptions, foreign currency fluctuations, regulatory changes (like right to repair legislation), and the pace of technology adoption. The company is also facing an antitrust lawsuit filed by the FTC and several state Attorneys General.