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(Sharecast News) - Tractor and combine harvester maker Deere & Co reported weaker first-quarter earnings as trade tariffs hit profit margins, but raised its income guidance on the back of a predicted recovery in agriculture markets.
The company reported net income of $656m or $2.42 per share for the three months to 1 February, down 25% from the year before but well ahead of the $2.02 a share expected by the market.
Group net sales and revenues were 13% higher at $9.61bn, driven by a 34% sales increase in the Construction & Forestry arm to $2.67bn, 24% growth in net sales in the Small Agriculture & Turf division, while Production & Precision Agriculture sales rose 3% to $3.16bn.
"While the global large agriculture industry continues to experience challenges, we're encouraged by the ongoing recovery in demand within both the construction and small agriculture segments," said John May, chairman and chief executive.
"These positive developments reinforce our belief that 2026 represents the bottom of the current cycle and provides us with a strong foundation for accelerated growth going forward."
For FY26, the company expects full-year net income to be between $4.5bn and $5.0bn, up from the previous estimate of $4.0bn-4.75bn, well ahead of the current $4.43bn consensus forecast.
Deere & Co futures were up 6% at $629 with 90 minutes to go before the opening bell.
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