Deere & Co reported third-quarter fiscal 2026 earnings that exceeded analyst expectations, with adjusted diluted earnings per share of $5.10, up 8.7% from the $4.69 forecast. Net sales rose 5% year-over-year to $12.608 billion, surpassing the $10.81 billion consensus by $1.80 billion. Equipment operations sales increased 6% to $10.999 billion, while net income attributable to the company totaled $1.379 billion, down from $1.734 billion in the prior-year period.
The company recognized $110 million in incremental tariff refunds during the quarter, bringing total fiscal 2026 refunds to $382 million. Equipment operations operating margin stood at 14.4%, while financial services net income reached $219 million. Deere maintained its dividend for the 56th consecutive year, with a yield of 1.12%.
Segment performance showed mixed trends. Production & Precision Agriculture net sales declined 6% to $3.998 billion, with an operating profit of $527 million and a 13.2% margin. Small Agriculture & Turf net sales rose 12% to $3.383 billion, generating $622 million in operating profit at an 18.4% margin. Construction & Forestry net sales grew 18% to $3.618 billion, with operating profit of $436 million and a 12.1% margin.
Shares rose 7.66% in premarket trading to $625.12, extending gains from the prior close of $580.63. The stock has traded between $433 and $674.19 over the past 52 weeks.
Management raised full-year fiscal 2026 guidance, projecting net income of $4.75 billion to $5.0 billion and equipment operations cash flow of $5.0 billion to $5.5 billion. The effective tax rate is expected to remain between 24% and 26%, while financial services net income is forecast at $870 million. Direct tariff expenses are projected at approximately $1.1 billion for fiscal 2026, down from a prior run rate of $1.2 billion, with net exposure for fiscal 2027 expected at about $1 billion following Section 232 tariff reductions.
Segment outlooks for the full year include a 10% decline in Production & Precision Agriculture net sales, a 15% increase in Small Agriculture & Turf, and steady 20% growth in Construction & Forestry. Operating margins are expected to narrow across most segments, reflecting competitive pricing pressures and regional demand variations.
