Economic Indicators - Pre-market futures are showing positive movement, with major indices like the Dow, S&P 500, and Nasdaq all up, indicating a strong trading day [1] - Weekly Jobless Claims reported at 216K, below expectations of 225K, suggesting a resilient job market [4] - Durable Goods Orders increased by 0.5%, aligning with expectations, while non-defense, ex-aircraft durable goods orders rose by 0.9%, indicating potential growth in business spending [6] Company Performance - Deere & Co. reported fiscal Q4 results, missing earnings estimates by 3 cents at $3.93 per share, marking the first earnings miss in three years, although revenues exceeded expectations by 5.92% at $10.58 billion [7] - Shares of Deere & Co. are trading down 3.5% following the earnings report, despite a year-to-date gain of 17.6% [7] Consumer Behavior - An estimated 31 million people are expected to travel for Thanksgiving, indicating strong consumer spending on travel despite the performance of major airlines [8]

Economic Indicators - Pre-market futures are positive, with major indices showing gains: Dow +77 points, S&P 500 +18, Nasdaq +107 points, and Russell 2000 flat after a +2% increase the previous day [1] - Weekly Jobless Claims reported at 216K, below expectations of 225K, indicating a resilient job market [4][3] - Continuing Claims total 1.960 million, slightly up from the previous week's revised figure, suggesting stability in longer-term jobless claims [4][5] - Durable Goods Orders increased by 0.5%, aligning with expectations, while orders excluding transportation rose by 0.6% [6] Company Performance - Deere & Co. reported fiscal Q4 results, missing earnings estimates by 3 cents at $3.93 per share, marking the first earnings miss in three years, although revenues exceeded expectations by 5.92% at $10.58 billion [8] - Shares of Deere are trading down 3.5% following the earnings report, despite a year-to-date gain of 17.6% [8] Consumer Behavior - An estimated 31 million people are expected to travel for Thanksgiving, indicating strong consumer spending on travel despite the economic climate [9]

Core Viewpoint - Deere & Co.'s first outlook for the upcoming fiscal year is below expectations, with net income projected between $4 billion and $4.75 billion, falling short of the average estimate of $5.31 billion [1] Group 1: Financial Performance - The projected net income for Deere & Co. is between $4 billion and $4.75 billion for the fiscal year starting November 1 [1] - This outlook has led to a decline in shares by as much as 4.6% before regular trading commenced in New York [1] Group 2: Market Conditions - The weak outlook is attributed to challenges faced by farmers, including low crop prices and the impact of tariff policies [2] - Despite a recent trade deal between the US and China aimed at increasing American crop shipments to Asia, uncertainty remains regarding its effectiveness in revitalizing the US farm economy [2] Group 3: Industry Sentiment - Rival manufacturer CNH Industrial NV has expressed concerns about the ambiguity of the trade deal, which contributes to uncertainty in the sector regarding farmer spending [3] - There is a belief within the industry that the resumption of US crop imports by China and an upcoming aid package for American farmers may provide support in 2026 [3]

Group 1 - Proactive provides fast, accessible, informative, and actionable business and finance news content to a global investment audience [2] - The news team covers medium and small-cap markets, as well as blue-chip companies, commodities, and broader investment stories [3] - Proactive's content includes insights across various sectors such as biotech, pharma, mining, natural resources, battery metals, oil and gas, crypto, and emerging technologies [3] Group 2 - Proactive is committed to adopting technology to enhance workflows and content production [4] - The company utilizes automation and software tools, including generative AI, while ensuring all content is edited and authored by humans [5]

Core Viewpoint - Deere & Co. reported better-than-expected earnings and sales for Q4 2025, but the stock fell 4% due to weaker guidance for 2026, leading to investor disappointment [1][6]. Financial Performance - For Q4 2025, Deere earned $3.93 per share, exceeding the forecast of $3.83, and reported sales of $12.9 billion, which was 32% higher than the expected $9.8 billion [1]. - Year-over-year earnings declined by 14%, despite an 11% increase in sales [3]. - For the full year, Deere's earnings were $18.50 per share, a 28% decline, with total sales down 12% to $45.7 billion [3]. Future Outlook - Deere provided a cautious outlook for 2026, predicting a potential 20% decline in "large ag" sales, while other segments may see low-to-mid single-digit growth [4]. - The company anticipates earnings of less than $17.60 per share in fiscal 2026, which is below Wall Street's expectation of $19.32 per share [4][6]. - CEO John May indicated that 2026 might mark the bottom of the large ag cycle, with expectations for improvement thereafter [5]. Market Reaction - Despite beating earnings and sales expectations, the stock selloff was driven by the disappointing guidance for 2026 and a high valuation of 27 times earnings [6].

Financial Data and Key Metrics Changes - In fiscal year 2025, net sales and revenues decreased by 12% to $45.7 billion, while net sales for equipment operations fell by 13% to $38.9 billion [8][12] - Net income attributable to Deere & Company was $5 billion, or $18.50 per diluted share [8][12] - For the fourth quarter, net sales and revenues increased by 11% to $12.4 billion, and net sales for equipment operations rose by 14% to $10.6 billion [8][12] - Net income for the fourth quarter decreased to $1.1 billion, or $3.93 per diluted share [8][12] Business Segment Data and Key Metrics Changes - Production and Precision Ag segment saw net sales of $4.74 billion, up 10% year-over-year, with an operating margin of 12.7% [9] - Small Ag and Turf segment reported net sales of $2.57 billion, up 7% year-over-year, but operating profit declined to $25 million due to higher costs [10] - Construction and Forestry segment's net sales increased by 27% year-over-year to $3.382 billion, with an operating margin of 10.3% [13] Market Data and Key Metrics Changes - Industry sales of large equipment in the U.S. and Canada are expected to decline by 15%-20% in fiscal year 2026, while small ag and turf demand is estimated to be flat to up 5% [10][11] - In Europe, the industry is projected to be flat to up 5%, with robust dairy sector margins [11][46] - South America is expected to see flat industry sales, with Brazilian demand tempered by high interest rates and strong global crop yields [11][12] Company Strategy and Development Direction - The company aims to manage inventory carefully and avoid oversupply while focusing on used inventory reduction [37] - Deere is committed to advancing its smart industrial journey, emphasizing technology and innovation across all production systems [19][23] - The company anticipates growth in small ag and turf, as well as construction and forestry, while entering North American large ag with lean production [67] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about stabilization in certain segments and geographies, despite challenges in large ag [7][8] - The company highlighted strong crop use and supportive government payments as potential upside factors [10][41] - Management acknowledged the resilience of the organization amidst a challenging market backdrop, with a focus on long-term customer value [19][67] Other Important Information - The company expects full-year net income for fiscal year 2026 to be in the range of $4 billion to $4.75 billion, with an effective tax rate between 25%-27% [17] - Cash flow from equipment operations is projected to be between $4 billion and $5 billion [17] - The company plans to resume normal capital allocation activities in 2026 after pausing buybacks in Q4 due to market uncertainty [67] Q&A Session Summary Question: How is the company thinking about offsetting the $1.2 billion tariff headwind in 2026? - The company expects to capture back some of the incremental exposure through price-cost positive expectations and will continue to execute activities to mitigate the impact [73][74] Question: Can you provide insights on the production plans and product mix implications for seasonality? - The company anticipates lower than normal seasonal production to start the year, with flexibility to adjust to demand in subsequent quarters [51][44]

Financial Data and Key Metrics Changes - For fiscal year 2025, net sales and revenues decreased by 12% to $45.7 billion, while net sales for equipment operations fell by 13% to $38.9 billion [8] - Net income attributable to Deere & Company was $5 billion, or $18.50 per diluted share [8] - In the fourth quarter, net sales and revenues increased by 11% to $12.4 billion, with net sales for equipment operations rising by 14% to $10.6 billion [8] - Net income attributable to Deere & Company for the fourth quarter decreased to $1.1 billion, or $3.93 per diluted share [8] Business Segment Data and Key Metrics Changes - Production and Precision Ag segment saw net sales of $4.74 billion, up 10% year-over-year, with an operating profit of $604 million and a 12.7% operating margin [9] - Small Ag and Turf segment reported net sales of $2.57 billion, up 7% year-over-year, but operating profit declined to $25 million due to higher costs [10] - Construction and Forestry segment's net sales increased by 27% year-over-year to $3.382 billion, with an operating profit of $348 million and a 10.3% operating margin [13] Market Data and Key Metrics Changes - Industry sales of large equipment in the U.S. and Canada are expected to decline by 15%-20% in fiscal year 2026, while small agriculture and turf demand is estimated to be flat to up 5% [10][11] - In Europe, the industry is projected to be flat to up 5%, with robust dairy sector margins and improving arable cash flows [11] - South America is expected to see flat industry sales, with Brazilian customer demand tempered by high interest rates and strong global crop yields [11] Company Strategy and Development Direction - The company aims to manage inventory carefully and avoid oversupply while focusing on used inventory reduction [37] - Deere is committed to advancing its Smart Industrial journey, emphasizing technology and innovation to enhance customer value [20][23] - The company anticipates growth in small ag and turf, as well as construction and forestry, while entering fiscal year 2026 with lean production in North American large ag [67] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about stabilization in certain segments and geographies, despite challenges in large ag [7][8] - The company highlighted strong crop use and consumption, new trade agreements, and supportive government payments as potential growth drivers [11] - Management acknowledged the resilience of the organization in navigating a challenging market environment while maintaining strong performance levels [20][26] Other Important Information - The company expects full-year net income for fiscal year 2026 to be in the range of $4 billion to $4.75 billion, with an effective tax rate between 25%-27% [17] - Cash flow from equipment operations is projected to be between $4 billion and $5 billion [17] - The company plans to resume normal capital allocation activities in 2026 after pausing buybacks in the fourth quarter of fiscal 2025 [66] Q&A Session Summary Question: How is the company thinking about offsetting the $1.2 billion tariff headwind in 2026? - The company expects to capture back some of the incremental exposure this year and some from 2025, with a plan to continue executing activities to mitigate the impact [73][74] Question: Can you provide insights on the production plans and product mix implications for seasonality? - The company anticipates net sales in production precision ag to be close to the first quarter of 2025, but margins will be significantly lower due to a lean production plan [51]

Financial Data and Key Metrics Changes - In Q4 2025, net sales and revenues increased by 11% to $12.4 billion, while net sales for equipment operations rose by 14% to $10.6 billion. However, net income attributable to Deere & Company decreased to $1.1 billion, or $3.93 per diluted share [6][12]. - For the full year, net sales and revenues were down 12% to $45.7 billion, with net sales for equipment operations down 13% to $38.9 billion. Net income was $5 billion, or $18.50 per diluted share [6][12]. Business Segment Data and Key Metrics Changes - Production and Precision Ag segment saw net sales of $4.74 billion, up 10% year-over-year, with an operating margin of 12.7%. The increase was attributed to higher shipment volumes and favorable price realization [7]. - Small Ag and Turf segment reported net sales of $2.57 billion, up 7% year-over-year, but operating profit declined to $25 million due to higher tariffs and production costs [8]. - Construction and Forestry segment experienced a 27% increase in net sales to $3.382 billion, with an operating margin of 10.3% [12]. Market Data and Key Metrics Changes - The outlook for large equipment sales in North America is expected to decline by 15%-20%, while small ag and turf demand is estimated to be flat to up 5% [9][10]. - In Europe, the industry is projected to be flat to up 5%, with robust dairy sector margins and improving arable cash flows [10][43]. - South America is expected to see flat industry sales, with Brazil's demand tempered by high interest rates and strong global crop yields [10][11]. Company Strategy and Development Direction - The company aims to manage inventory carefully and avoid oversupply while focusing on used inventory reduction. This strategy is expected to position the market well for 2026 [34]. - The company is committed to advancing its smart industrial journey, emphasizing technology and innovation to enhance customer value and operational efficiency [20][66]. - The focus on R&D investment is expected to support future growth and unlock value for customers and shareholders [64][66]. Management's Comments on Operating Environment and Future Outlook - Management noted that fiscal 2025 was marked by significant challenges, but the company demonstrated resilience with over $5 billion in net income and strong operating margins [5][18]. - The company anticipates a subdued large ag market in North America for 2026 but sees growth opportunities in small ag, turf, and construction forestry segments [6][10]. - Management expressed optimism about stabilizing market conditions and the potential for growth driven by favorable commodity demand and government support for farmers [37][46]. Other Important Information - The company expects a full-year net income forecast for 2026 to be in the range of $4 billion to $4.75 billion, with a projected effective tax rate between 25%-27% [16]. - The company plans to resume normal capital allocation activities in 2026 after pausing buybacks in Q4 2025 due to market uncertainty [64]. Q&A Session Summary Question: How is the company thinking about offsetting the $1.2 billion tariff headwind in 2026? - The company expects to capture back some of the incremental exposure from tariffs through price-cost positive strategies and plans to take additional price increases as needed [70]. Question: Can you unpack the decremental margin on the sales decline in the Production and Precision Ag segment? - The company acknowledged that a significant portion of the decremental margin is attributed to tariffs, and they are working on improving profitability in other regions, particularly Brazil [74].

Core Insights - Deere & Company shares declined following a weak forecast, indicating that challenging market conditions will persist for an extended period [1][5] Financial Performance - In the fourth quarter of fiscal 2025, Deere reported earnings per share of $3.93 and revenue of $12.39 billion, both surpassing analyst expectations [3] - The Production & Precision Agriculture division saw a sales increase of 10% to $4.74 billion, while the Small Agriculture & Turf unit grew by 7% to $2.46 billion, and the Construction & Forestry segment surged by 27% to $3.38 billion [3] Future Outlook - For fiscal 2026, Deere anticipates net income between $4.00 billion and $4.75 billion, lower than the analyst consensus of $5.19 billion [2] - The company expects a decline in Production & Precision Agriculture sales by 5% to 10%, while projecting a 10% increase in both Small Agriculture & Turf and Construction & Forestry sales [4]

Core Insights - Deere reported $10.58 billion in revenue for the quarter ended October 2025, a year-over-year increase of 14.1%, with an EPS of $3.93 compared to $4.55 a year ago [1] - The revenue exceeded the Zacks Consensus Estimate of $9.99 billion by 5.92%, while the EPS fell short of the consensus estimate of $3.96 by 0.76% [1] Revenue Breakdown - Production & precision ag net sales reached $4.74 billion, surpassing the average estimate of $4.61 billion, reflecting a year-over-year increase of 10.1% [4] - Agriculture and Turf net sales totaled $7.2 billion, exceeding the average estimate of $6.8 billion, marking a 9% year-over-year increase [4] - Equipment Operations net sales were $10.58 billion, above the five-analyst average estimate of $9.9 billion, representing a 14.1% year-over-year change [4] - Small ag & turf net sales amounted to $2.46 billion, exceeding the average estimate of $2.2 billion, with a year-over-year increase of 6.6% [4] - Construction & forestry net sales reached $3.38 billion, surpassing the average estimate of $3.1 billion, indicating a significant year-over-year increase of 27% [4] - Other revenues were reported at $267 million, below the estimated $311.55 million, reflecting a year-over-year decline of 22.8% [4] - Financial services revenues totaled $1.55 billion, slightly below the average estimate of $1.57 billion, with a year-over-year increase of 1.7% [4] - Financial services- Other Income was $171 million, exceeding the estimated $126.74 million, showing a year-over-year increase of 46.2% [4] - Financial services- Total revenues were $1.67 billion, below the estimated $1.7 billion, representing a year-over-year decline of 0.9% [4] - Financial services- Finance and Interest Income was reported at $1.5 billion, below the average estimate of $1.58 billion, reflecting a year-over-year decrease of 4.4% [4] - Net sales were $10.58 billion, compared to the average estimate of $9.89 billion, indicating a year-over-year change of -5.1% [4] - Equipment Operations- Other income was $242 million, slightly below the average estimate of $247.22 million, with a year-over-year decline of 11.7% [4] Stock Performance - Deere's shares have returned +6.4% over the past month, contrasting with the Zacks S&P 500 composite's -0.3% change [3] - The stock currently holds a Zacks Rank 4 (Sell), suggesting potential underperformance relative to the broader market in the near term [3]