CNH Industrial, a major manufacturer of agricultural and construction equipment, delivered disappointing news to investors Tuesday by projecting annual earnings well below analyst expectations due to continued weakness in the farm machinery market.
The company’s stock dropped over 4% in early trading following the announcement.
CNH Industrial, headquartered in Basildon, UK, anticipates that retail sales will decline approximately 5% in 2026 compared to 2025 figures. The manufacturer plans to maintain reduced production levels while collaborating with dealerships to address surplus inventory throughout their distribution network.
Agricultural equipment manufacturers have been cutting back on factory production as demand for new machinery remains persistently weak. Declining crop values and increasing operational expenses have led farmers to postpone major equipment investments, creating a buildup of unsold inventory at dealerships and prompting a more conservative restocking strategy.
For the full year, CNH Industrial projects adjusted earnings per share between $0.35 and $0.45, falling short of the $0.54 per share that analysts had predicted, based on LSEG data.
American farmers are confronting another challenging year marked by depressed commodity prices, elevated expenses, and tough choices about continuing operations as oversupplied grain markets continue to pressure profitability.
The U.S. Department of Agriculture projected earlier this month that net farm income, a key indicator of agricultural sector health, will decrease 0.7% to $153.4 billion in 2026 compared to the previous year.
“Agricultural equipment industry demand is expected to resume growth in 2027,” CNH said.
CNH Industrial, which produces Case IH and New Holland tractor brands, posted fourth-quarter revenues of $5.16 billion, surpassing analyst projections of $4.61 billion.
The company reported adjusted quarterly earnings of 19 cents per share for the period ending December 31, exceeding analyst expectations of 10 cents per share.
