Deere & Company Reports Significant Net Income Decline for Q3 2025

Deere & Company (NYSE: DE) disclosed its financial performance for the third quarter ended July 27, 2025, revealing a stark reduction in net income to $1.289 billion, or $4.75 per share. This figure represents a considerable decrease from the $1.734 billion, or $6.29 per share, for the same quarter of the previous year. The financial results point to the company's struggle to maintain profitability amidst an unpredictable market environment.

The first nine months of the year also saw a decline in net income, totaling $3.962 billion or $14.57 per share, compared to $5.855 billion or $21.04 per share during the same period in 2024. This downturn reflects broader economic pressures impacting Deere's operations and sales strategies.

Decreased Sales and Revenues

Deere's worldwide net sales and revenues for the third quarter fell by 9% to $12.018 billion when compared to $13.152 billion in Q3 of 2024. Over the nine-month period, revenues decreased by 18%, totaling $33.290 billion down from $40.572 billion the previous year. Notably, for the quarterly breakdown, net sales dropped to $10.357 billion, down from $11.387 billion in the prior year.

Chairman and CEO John May addressed these challenges, stating, "By proactively managing inventory, we've matched production to retail demand, enabling our company and dealers to respond swiftly to market shifts and customer needs." This statement highlights Deere’s strategy to adjust its operations in response to fluctuating demand.

The company also noted significant challenges in its product segments that contributed to the decline in sales and profitability. The Production & Precision Agriculture segment reported net sales of $4.273 billion, a decrease of 16%, with operating profit halved to $580 million compared to the previous year. Likewise, the Small Agriculture & Turf segment experienced only a slight drop in net sales, declining by 1% to $3.025 billion, but saw a minor decrease in operating profit.

In the Construction & Forestry segment, net sales were down 5% to $3.059 billion, with operating profit plunging by nearly half to $237 million, attributed to unfavorable price realizations and increased production costs.

Financial Services Showing Resilience

Despite the overall declines, Deere's Financial Services arm reported net income of $205 million for the quarter, showing a 34% increase due to reduced provisions for credit losses. This sector appears to have weathered some of the storms experienced in other areas of the business, demonstrating its importance to the broader company portfolio.

Future Outlook for Deere

Looking ahead, Deere has narrowly adjusted its fiscal 2025 net income guidance, projecting a range between $4.75 billion and $5.25 billion. The company remains optimistic about its future growth, focusing on delivering solutions that cater to current customer needs while preparing for evolving industry demands.

"The positive outcomes we're enabling reinforce our confidence in Deere's future despite near-term uncertainty," May stated, pointing to the adoption of advanced technologies as instrumental in improving productivity for its customers.

The forecast for various markets suggests continued volatility, especially with reference to agricultural markets which are forecasting declines of approximately 30% for large agriculture and 10% for small agriculture. Construction and forestry markets are also expected to contract further.

The report reflects critical lessons for stakeholders concerning the importance of adapting to market dynamics and enhancing operational efficiencies in times of economic distress. As the agricultural and construction industries navigate these complex challenges, Deere remains committed to meeting customer expectations through innovation and strategic agility.

Deere's efforts to cultivate a resilient market environment are characterized by disciplined execution, proactive management strategies, and a focus on future-ready technologies, which will be essential as the company seeks to overcome existing hurdles.