Deere & Company raised the lower bound of its 2026 net income forecast after reporting its first quarterly profit increase in three years, driven by strong demand for construction and forestry equipment.
The Moline, Illinois-based manufacturer posted quarterly revenue of $11 billion, a 6% increase from a year earlier and above analyst expectations of $10.73 billion. Earnings per share totaled $5.10, up from $4.75 in the same period last year and ahead of the $4.70 estimate compiled by LSEG.
Deere’s shares rose nearly 9%, on track for the best single-day gain in six months. The company’s construction and forestry segment posted an 18% rise in net sales, outpacing declines in its production and precision agriculture division, which fell 6%. Small agriculture and turf equipment sales increased 12%.
Chief Financial Officer Brent Norwood cited rising U.S. infrastructure spending and data center expansion as key drivers for the construction equipment segment, now the company’s fastest-growing business. Customer backlogs extend into fiscal 2027, according to investor relations director Chris Seibert.
The agricultural sector remains under pressure, with prolonged weakness in large tractor and combine harvester sales due to elevated farm costs and softer commodity prices. "Commodity pricing acts as a hard ceiling on major sales recovery," said Ryan Keeney of Third Bridge. CEO John May reiterated the company’s view that 2026 will mark the bottom of the current agricultural equipment cycle.
Deere raised the lower end of its 2026 net income forecast to a range of $4.75 billion to $5 billion, up from the prior projection of $4.5 billion to $5 billion. The company also recorded a $110 million tariff refund during the quarter and expects net tariff costs of about $750 million in 2026 and roughly $1 billion in 2027.
