Deere & Co Stock Slips Premarket After Q1 Earnings Slump: Retail Stays Bearish
Synopsis
The company said that sales in its production and precision agriculture segment decreased by 37% to $3.67 billion for the quarter, while sales in the small agriculture and turf segment fell by 28%.
Deere & Co (DE) stock was down 5.2% premarket on Thursday after the company’s first-quarter net income fell 50% compared to last year.
The farm equipment maker reported a net income of $869 million, or $3.19 per share, for the first quarter, compared to $1.75 billion, or $6.23 per share, last year.
Its quarterly net sales declined by 30% to $8.51 billion compared to the year-ago quarter but topped a Wall Street estimate of $7.90 billion, according to KoyFin data.
Deere said that sales in its production and precision agriculture segment decreased by 37% to $3.67 billion for the quarter, while sales in the small agriculture and turf segment fell by 28%.
According to the U.S. Department of Agriculture, farm income declined in 2024 due to higher interest rates and lower crop prices. Analysts fear a fresh tariff war would further raise crop production costs and weigh in on farmers’ earnings.
Deere also said its construction and forestry segment sales fell 38% to $1.99 billion.
The company reaffirmed its fiscal 2025 profit forecast between $5 billion and $5.5 billion.
The Illinois-based company expects fiscal 2025 net sales in its production and precision agriculture segment, including tractors and combine harvesters, to decline between 15% and 20%. It had earlier projected a fall of 15%.
Deere added that its outlook does not include the impact of tariffs.
Retail sentiment on Stocktwits remained in the ‘bearish’ (31/100) territory, albeit with a higher score than a day ago. Retail chatter on the stock was ‘high.’
The company unveiled several autonomous machines last month, which would not require a human in the driver’s seat, amid a shortage of skilled workers in agriculture.
Over the past year, Deere stock has gained 24%.
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