Deere cuts forecast, jobs

Glenn HansenAugust 15, 2024

Releasing its Q3 2024 financial statement, Deere & Company reported worldwide net sales and revenues decreased 17 percent, to $13.152 billion, for the third quarter of 2024 and decreased 11 percent, to $40.572 billion, for nine months.

The company reported net income of $1.734 billion for the third quarter ended July 28, 2024, or $6.29 per share, compared with net income of $2.978 billion, or $10.20 per share, for the quarter ended July 30, 2023. For the first nine months of the year, net income attributable to Deere & Company was $5.855 billion, or $21.04 per share, compared with $7.797 billion, or $26.35 per share, for the same period last year.

Deere also reported in this Q3 statement a $124 million charge covering employee-separation programs for its salaried workforce in several geographic areas, including the United States, Europe, Asia, and Latin America. It said the programs’ main purpose was to help meet the company’s strategic priorities while reducing overlap and redundancy in roles and responsibilities. The programs were largely involuntary in nature with the expense recorded when management committed to a plan, the plan was communicated to the employees, and the employees were not required to provide service beyond the legal notification period.

“John Deere’s third-quarter results showcase our disciplined execution in the face of challenging conditions in the global agricultural and construction sectors,” said John C. May, chairman and chief executive officer. “Despite facing significant headwinds, our teams have demonstrated resiliency in adapting to market fluctuations, allowing us to remain focused on advancing our strategy and consistently providing exceptional value to our customers.”

Third Quarter by segment

Small Agriculture & Turf

Net sales dropped 18% year over year, from $3,739 million in 2023 to $3,053 in 2024 Q3. Operating profit fell 32%

Small agriculture and turf sales decreased for the quarter as a result of lower shipment volumes, partially offset by price realization. Operating profit decreased primarily due to lower shipment volumes and higher warranty expenses, partially offset by price realization.

Construction & Forestry

Net sales dropped 13 % year over year, from $3,739 million in 2023 to $3,235 million in 2024 Q3. Operating profit fell 37%

Construction and forestry sales decreased for the quarter due to lower shipment volumes. Operating profit decreased primarily due to lower shipment volumes / sales mix and unfavorable price realization.

Company Outlook & Summary

“In response to weak market conditions, we have taken steps to reduce costs and strategically align our production with customer needs,” said May. “Although these decisions were difficult, they are vital for our continued success and competitiveness. Our commitment to our customers is at the heart of everything we do, and we are confident that these proactive measures will allow us to continue investing in innovative, high-quality products and solutions that improve our customers’ lives.”

Net income attributable to Deere & Company for fiscal 2024 is forecasted to be approximately $7.0 billion.