Deere Lifts Profit Outlook
[Stay on top of transportation news: Get TTNews in your inbox.]
Deere & Co. raised its full-year profit forecast amid strong demand for farm equipment and the easing of supply chain woes that have dogged companies since the pandemic.
The U.S. tractor maker on May 19 lifted its outlook as it reported second-quarter profit of $2.86 billion that beat analyst estimates, citing healthy demand for farm and construction equipment and an improved operating environment. The company now expects earnings of $9.25 billion to $9.5 billion for the fiscal year that ends Oct. 31.
Shares rose 3.3% at 8:40 a.m. in premarket trading in New York.
Moline, Ill.-based Deere is a bellwether for the health of the agricultural industry given its position as the world’s largest producer of farm machinery. Surging prices for corn, wheat and soybeans over the past two to three years have boosted agricultural incomes and helped farmers replace aging equipment, from tractors to combines. The company also has been able to partially offset recent supply chain pressures with price hikes.
Deere & Company’s Q2 2023 Earnings are now available: https://t.co/OnXNTCl0jQ pic.twitter.com/y8jwus0MJx — John Deere (@JohnDeere) May 19, 2023
“Deere continues to benefit from favorable market conditions and an improving operating environment,” CEO John May said in a statement. “Though supply chain constraints continue to present a challenge, we are seeing further improvement.”
The company’s full-year profit forecast compares with February’s view of $8.75 billion to $9.25 billion.
The annual outlook for large agricultural equipment sales shows that U.S. and EU farmers are responsible for the increase, with 10% sales growth in the U.S. and as much as 5% higher in Europe. Asia sales will be down moderately, while sales of tractors and combines in South America will be unchanged.
Want more news? Listen to today's daily briefing below or go here for more info:
