Agricultural equipment manufacturer John Deere announced Thursday it has increased its yearly earnings projections, driven by recovering construction and compact farming equipment sectors along with expense reductions that helped offset sluggish machinery demand. The news boosted the company’s stock price by 4.7% in pre-market trading.
The Illinois-based equipment giant had previously reduced manufacturing output to address declining demand for new machinery, as farmers face lower commodity prices and increased operating expenses that delay major equipment investments.
Deere is collaborating with its dealer network nationwide to decrease stockpiled inventory levels.
American agricultural producers are preparing for another year of depressed crop values and high operational costs, creating difficult choices about continuing their farming operations amid abundant grain supplies that keep market prices low.
The machinery manufacturer now projects 2026 net earnings between $4.5 billion and $5 billion, an increase from the previous estimate of $4 billion to $4.75 billion.
“While the global large agriculture industry continues to experience challenges, we’re encouraged by the ongoing recovery in demand within both the construction and small agriculture segments,” CEO John May said.
“These positive developments reinforce our belief that 2026 represents the bottom of the current cycle.”
The company has revised its 2026 revenue expectations for its Small Agriculture & Turf and Construction & Forestry divisions, anticipating approximately 15% growth in each sector compared to the earlier projection of roughly 10% increases.
President Donald Trump’s extensive tariff policies have impacted the company’s operational earnings, placing Deere among numerous industrial firms affected by recent White House policy changes.
The Moline, Illinois-headquartered manufacturer has faced difficulties from increased production expenses due to tariffs, as the company depends heavily on imported raw materials for producing its signature green and yellow tractors.
Quarterly net earnings reached $656 million, equivalent to $2.42 per share, representing a decline from the previous year’s $869 million, or $3.19 per share.
First-quarter revenue for Deere increased 13% to $9.61 billion, compared to $8.50 billion in the same period last year.
