Deere & Company (DE) — Company Research

Last Updated: 18 July 2026

Deere & Company (NYSE: DE) is the world's largest manufacturer of agricultural equipment and a major producer of construction and forestry machinery, sold under the John Deere brand through one of the industry's strongest dealer networks. The company pairs iron with software: its precision-agriculture stack now counts roughly 440,000 monthly active users, and its See & Spray technology covered around 5 million acres last year. Fiscal 2025 (ended 2 November 2025) marked the second consecutive down year of the agricultural cycle, with net sales and revenues of $45.7 billion and net income of $5.03 billion, but management raised fiscal 2026 guidance in May 2026 as construction demand surged and the farm downturn showed signs of bottoming. This research is data-only: figures come from Deere's press releases, 10-K and 10-Q filings, and SEC XBRL data. You can chart the stock live on our Live Charts page.

1. Company Snapshot

2. Bull & Bear Case

Bull Case

• Precision-agriculture technology moat: Deere's software and automation stack — roughly 440,000 monthly active users, See & Spray covering ~5 million acres with demonstrated 50–60% herbicide savings — deepens dealer and customer lock-in and supports a growing recurring-revenue ambition.
• Construction & Forestry is booming: C&F net sales rose 29% year on year in Q2 FY2026 to $3.79bn on infrastructure and data-centre spending, and management guides segment sales up ~20% for FY2026 with roadbuilding up ~10%.
• Guidance raised mid-cycle: after four consecutive quarterly EPS beats, FY2026 net income guidance was lifted in May 2026 to $4.5–5.0bn from the initial $4.00–4.75bn, with management pointing to the agricultural cycle bottoming in 2026.
• Tariff relief and refunds: the US Supreme Court's 20 February 2026 decision invalidating IEEPA tariffs allowed Deere to book a $272m refund recovery in fiscal Q2, easing a headwind management had flagged when it first guided FY2026.
• Long-term reinvestment: a $20bn, 10-year US manufacturing investment programme (two new facilities announced 27 January 2026) plus a strong balance sheet — equipment-operations cash of $7.9bn — underpin capacity for the next upcycle.

Bear Case

• Large-ag downturn is not over: Production & Precision Agriculture sales fell 14% in Q2 FY2026 and the company guides US/Canada large-ag industry demand down 15–20% for FY2026, with South American tractors and combines down ~15%.
• Cyclical earnings, peak multiple: trailing GAAP EPS of ~$17.65 is roughly half the FY2023 peak of $34.63, yet the shares trade near 34x trailing earnings — a valuation that assumes a strong recovery arrives on schedule.
• Trade-policy uncertainty persists: despite the IEEPA refunds, other tariff programmes remain in force and Deere cited higher production costs from tariffs in both Q4 FY2025 and Q2 FY2026 segment commentary.
• Right-to-repair obligations: the 8 July 2026 FTC settlement requires Deere, for 10 years under FTC supervision, to give farmers and independent shops the same repair resources as authorised dealers — a potential drag on high-margin parts and service revenue.
• Captive-finance exposure: John Deere Financial carries a ~$70bn asset book funded by ~$57.9bn of total borrowings; a prolonged farm recession would raise credit losses and used-equipment residual risk.

3. Business Segments

Deere reports four segments. Figures below are fiscal 2025 (ended 2 November 2025) net sales for the equipment segments and total segment revenues for Financial Services, per the 10-K segment note; percentages are of total segment net sales and revenues of $46,116m (before intersegment eliminations).

4. Business Model & Moat

How it makes money. Deere sells equipment through independent dealers, books high-margin parts and service revenue across a large installed base, and increasingly monetises technology — precision-agriculture hardware, software subscriptions and data services. John Deere Financial then finances a large share of those purchases, earning a spread on a ~$70bn receivables and lease portfolio ($1,114m FY2025 segment operating profit). In FY2025 the equipment segments produced $38.9bn of external net sales (PPA $17.3bn, C&F $11.4bn, SAT $10.2bn) and Financial Services $6.3bn of segment revenues.

The moat. The John Deere dealer network is the widest distribution and service footprint in agriculture; switching costs rise as farms standardise on Deere machinery, guidance systems and agronomic data. Technology adoption deepens this: See & Spray has scaled from 1 million acres in its first year to roughly 5 million acres, cutting herbicide use 50–60%, and R&D spending ran at $583m in fiscal Q2 2026 alone. Scale (FY2025 revenue of $45.7bn versus AGCO's ~$10.1bn and CNH's $18.1bn) lets Deere outspend rivals on autonomy and electrification through the cycle.

The cycle and the finance arm. Equipment demand tracks farm income and commodity prices, so revenue swings hard — from $61.3bn (FY2023) to $45.7bn (FY2025). The captive finance arm smooths purchases for customers and captures financing economics, but it also concentrates credit and residual-value risk on Deere's balance sheet, which carried $43.5bn of long-term borrowings at FY2025 year-end.

5. Financial Health

Annual figures below are from Deere's audited 10-K filings and SEC XBRL data. Revenue in the table is net sales plus finance and interest income per the consolidated income statements (the "total revenue" basis used by standard market-data providers); it excludes the separate "other income" line of roughly $1.0–1.3bn a year. Including other income, total net sales and revenues were $45,684m in FY2025, $51,716m in FY2024 and $61,251m in FY2023. Deere's fiscal year ends in late October / early November — FY2025 ran 28 October 2024 to 2 November 2025 (53 weeks).

* Deere does not publish an adjusted (non-GAAP) EPS measure; fully diluted GAAP EPS is shown in both columns. Results in several years include special items described in the company's filings (for example, tariff-related items in FY2025–26). Revenue components per the 10-K income statements: FY2025 net sales $38,917m + finance and interest income $5,748m; FY2024 $44,759m + $5,759m; FY2023 $55,565m + $4,683m; FY2022 $47,917m + $3,365m; FY2021 $39,737m + $3,296m. Long-term debt is year-end long-term borrowings per the 10-K balance sheet (excludes short-term borrowings and finance leases). Dividend/share is declared per fiscal year.

Quarterly figures (most recent first; revenue here is total net sales and revenues as headlined in Deere's press releases, including other income):

Cash generation held up through the downturn: FY2025 operating cash flow was $7,459m against capital expenditure (property and equipment) of $1,360m, with depreciation and amortisation of $2,229m. Fiscal Q2 2026 showed the cycle stabilising — revenue up 5% year on year to $13,369m, net income of $1,773m, and the six-month equipment net sales of $19.8bn versus $18.0bn a year earlier. Shareholders' equity stood at $27.4bn at 3 May 2026, and quarterly dividends have been held at $1.62 per share since the December 2024 increase.

6. Valuation Metrics

Raw metrics, July 2026. Not opinions on whether the stock is cheap or expensive.

7. What Are They Building?

Deere's stated ambition is to make farming and construction autonomous, connected and data-driven — and to convert that technology into recurring revenue.

Autonomy and precision agriculture. See & Spray targeted spraying has scaled from 1 million acres in its first year to roughly 5 million acres globally, with 50–60% herbicide savings demonstrated; the precision-ag ecosystem counts ~440,000 monthly active users. R&D spend was $583m in fiscal Q2 2026 alone (up from $549m a year earlier) as Deere extends autonomous tillage, spraying and orchard machinery across its fleet.

US manufacturing capacity. On 27 January 2026 Deere announced a distribution centre near Hebron, Indiana and a manufacturing campus in Kernersville, North Carolina — the first concrete steps in a $20bn, 10-year US investment programme confirmed by management on the Q2 FY2026 earnings call.

Construction & Forestry expansion. With US infrastructure and data-centre construction running hot, Deere guides C&F net sales up ~20% in FY2026 (roadbuilding up ~10%) and raised the segment outlook after Q2's 29% sales growth. Financial Services net income is guided to roughly $860m for FY2026. Upcoming macro catalysts that move the farm economy — USDA reports, rate decisions and trade headlines — can be tracked on our Economic Calendar.

8. Peer Comparison

Deere's closest listed peers span agricultural and construction machinery. Figures are from each company's reported results and market data as at the dates shown.

9. Insider Activity

Form 4 filings over the past year show routine, plan-based activity from senior leadership, including Chairman and CEO John C. May; no open-market purchases by executives were identified in the filings reviewed.

10. Key Risks

• Agricultural equipment cycle: Deere guides US/Canada large-ag industry sales down 15–20% and South American tractors and combines down ~15% for FY2026; a slower-than-expected recovery would leave the elevated earnings multiple exposed.
• Farm income and commodity prices: demand for high-horsepower equipment tracks crop receipts and livestock economics; weak grain prices or poor harvests directly suppress orders and used-equipment values.
• Tariffs and trade policy: tariffs raised production costs in FY2025–26 and, while the Supreme Court's IEEPA ruling produced a $272m refund recovery, other tariff programmes and retaliatory measures remain live variables for costs and export demand.
• Right-to-repair obligations: under the 8 July 2026 FTC settlement Deere must provide farmers and independent repair providers the same repair resources as authorised dealers for 10 years, with potential erosion of parts and service margins over time.
• Captive-finance credit risk: John Deere Financial's ~$70bn asset book, funded by ~$57.9bn of borrowings, exposes the group to farmer credit losses, residual-value risk on leases and funding-cost swings.
• Competition: Caterpillar (construction), CNH, AGCO and Kubota (agriculture) compete on price and increasingly on technology, while lower-cost entrants pressure emerging-market share.
• Dealer inventory and demand timing: dealer destocking amplified the FY2024–25 revenue decline; misjudging channel inventories in either direction would distort shipment volumes versus retail demand.

11. Recent Developments

• 08 Jul 2026 — FTC right-to-repair settlement. The FTC and five states settled their antitrust suit against Deere: for 10 years, under FTC supervision, Deere must give farmers and independent repair providers the same repair resources — including software capabilities — that authorised dealers receive. The settlement removes a litigation overhang while creating long-term compliance obligations.
• 21 May 2026 — Q2 FY2026 beat; guidance raised. Net income of $1,773m ($6.55 diluted EPS, a fourth consecutive beat) on revenue of $13,369m, up 5%. Construction & Forestry sales rose 29% and Small Ag & Turf 16%, while Production & Precision Ag fell 14%. FY2026 net income guidance was raised to $4.5–5.0bn.
• 20 Feb 2026 — Supreme Court invalidates IEEPA tariffs. Following the ruling, Deere recorded a $272m recovery in fiscal Q2 for tariff refund claims accepted by US Customs and Border Protection.
• 27 Jan 2026 — New US facilities under $20bn plan. Deere announced a distribution centre near Hebron, Indiana and a manufacturing campus in Kernersville, North Carolina, part of its $20bn, 10-year US manufacturing investment commitment.
• 26 Nov 2025 — FY2025 results; cautious initial FY2026 outlook. FY2025 net income of $5,027m ($18.50 EPS) on revenue down 12% at $45,684m; Q4 revenue rose 11% to $12,394m. Initial FY2026 guidance of $4.00–4.75bn came in below market expectations as management warned of a larger tariff hit — guidance since raised.

12. Key Dates & What to Watch

• 20 Aug 2026 — Q3 FY2026 results expected (date per exchange calendars; Deere typically reports in mid-to-late August and had not formally confirmed at the time of writing)
• 01 Nov 2026 — fiscal 2026 year end
• Expected Nov 2026 — Q4 and full-year FY2026 results with initial FY2027 guidance (Deere reported FY2025 results on 26 November 2025)
• TBC — next quarterly dividend declaration; the rate has been $1.62 per share since December 2024, so any move would signal the board's view of the cycle

Watch the cadence of large-ag order books, used-equipment inventories and any further tariff rulings; these drive the FY2027 setup. Discuss the stock with other members on our Forum.

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