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Deere Posts Mixed Q2 Results, Guidance Cut

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Deere Posts Mixed Q2 Results, Guidance Cut

American manufacturer of agricultural and forestry machinery company Deere & Company (NYSE: DE) on Friday posted mixed second-quarter earnings results.

Trade tensions between the U.S. and China could take their toll on the equipment giant, with farmers being caught in the crossfire of the trade and commodities such as soybeans being impacted.

What To Know

Deere & Company reported net income of $1.135 billion for the quarter, or $3.52 per share, compared with net income of $1.208 billion, or $3.67 per share, for the same period last year. Global net sales and revenues increased 6 percent, to $11.342 billion, for the second quarter.

Wall Street analysts expected earnings of $3.61 per share on sales of $10.18 billion.

Net sales of the equipment operations were $10.273 billion for the quarter, compared with $9.747 billion last year.

"John Deere produced solid results for the quarter despite uncertain conditions in the agricultural sector," Samuel Allen, CEO of Deere & Company said in the press release.

"Ongoing concerns about export-market access, near-term demand for commodities such as soybeans, and a delayed planting season in much of North America are causing farmers to become much more cautious about making major purchases. At the same time, overall economic conditions remain positive, a fact that along with a growing customer base has contributed to strong results from our construction and forestry business," adds Allen.

What's Next

Deere expects equipment sales are projected to increase by about 5 percent for fiscal 2019 compared with 2018.

The company cut 2019 net income guidance from $3.6 billion to $3.3 billion and cut 2019 sales growth guidance From 7 percent To 5 percent.

Deere's stock traded down more than 4.4 percent to $139.55 per share Friday morning.

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