Deere & Company (DE) Q1 2026 earnings summary

Executive summary

• Net sales and revenues for the first quarter rose 13% year-over-year to $9.61 billion, with equipment operations net sales up 18% to $8.51 billion; growth was led by Small Ag & Turf and Construction & Forestry.

• Net income attributable to the company was $656 million ($2.42 per share), down 25% from $869 million ($3.19 per share) year-over-year, primarily due to higher tariffs and the absence of prior period tax benefits.

• Order books strengthened across product lines, especially in Small Ag & Turf and construction, with shipments ahead of plan and resilience across customer segments.

• Management views 2026 as the bottom of the current cycle, projecting a foundation for accelerated growth.

Financial highlights

• Equipment operations net sales increased 18% year-over-year to $8.51 billion, with margins just under 6%.

• Net income was $656 million, a 25% decrease year-over-year; diluted EPS was $2.42, down from $3.19.

• Production & Precision Ag net sales were up 3% to $3.163 billion, Small Ag & Turf up 24% to $2.168 billion, and Construction & Forestry up 34% to $2.67 billion.

• Operating profits: Production & Precision Ag at $139 million (4.4% margin), Small Ag & Turf at $196 million (9% margin), Construction & Forestry at $137 million (5.1% margin).

• Financial services net income was $244 million, up year-over-year due to favorable financing spreads and lower credit loss provisions.

Outlook and guidance

• Fiscal 2026 net income guidance raised to $4.5–$5.0 billion; effective tax rate expected between 25% and 27%.

• Equipment operations cash flow forecast increased to $4.5–$5.5 billion; capex expected around $1.4 billion.

• Production & Precision Ag net sales forecasted down 5–10% for the year, with 11–13% operating margin; Small Ag & Turf net sales up 15% (13.5–15% margin); Construction & Forestry net sales up 15% (9–11% margin).

• Large Ag industry in U.S. and Canada expected to decline 15–20% in 2026, but stability and replacement demand are emerging; Europe ag flat to up 5%, South America down ~5%.