Deere & Company Reports Q3 2025 Profit Decline Amid Sales Decrease

Deere & Company (DE.US) reported a net income of $1.289 billion for the third quarter ended July 27, 2025, which translates to $4.75 per share. This represents a 26% decrease from the net income of $1.734 billion, or $6.29 per share, reported in the same quarter last year. Worldwide net sales and revenues for the quarter were $12.018 billion, a 9% decrease compared to $13.152 billion in the prior year. The reported EPS of $4.75 was below the analyst estimate of $4.62 per share.

Segment Performance

The Production & Precision Agriculture segment experienced a 16% decrease in net sales, totaling $4.273 billion, primarily due to lower shipment volumes and unfavorable price realization. Its operating profit declined by 50% to $580 million, reflecting the impact of reduced volumes and sales mix. The Small Agriculture & Turf segment saw a modest 1% decrease in net sales to $3.025 billion, mainly due to lower shipment volumes, although this was partially offset by favorable currency translation and price realization.

The Construction & Forestry segment's net sales decreased by 5% to $3.059 billion, primarily impacted by unfavorable price realization. This segment's operating profit saw a significant 47% reduction, falling to $237 million, largely due to the same pricing issues and higher production costs from increased tariffs. Conversely, the Financial Services segment reported a 34% increase in net income, reaching $205 million, driven by a lower provision for credit losses and the impact of prior year special items.

Management Outlook

Deere & Company has narrowed its full-year net income forecast for fiscal 2025 to a range of $4.75 billion to $5.25 billion. Management emphasized their commitment to adapting to market shifts by proactively managing inventory and matching production to retail demand. This strategy aims to create a healthier market environment for customers, dealers, and the company, even amid challenging conditions.

Chairman and CEO John May highlighted the increasing utilization of advanced technologies, such as See & Spray and Harvest Settings Automation, which are empowering customers to enhance productivity. These technological advancements reinforce confidence in Deere's future growth trajectory, despite ongoing near-term market uncertainties. The company also provided an industry outlook for fiscal 2025, anticipating decreases in U.S. & Canada Large Ag sales by approximately 30%, Small Ag & Turf by approximately 10%, and Construction Equipment by approximately 10%.