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(Bloomberg) -- Deere & Co. shares slid in pre-market trading as the world leader in farm machinery anticipates another challenging year.
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The maker of the iconic green and yellow machines used to plant and harvest crops kept its 2025 net income estimate between $5 billion to $5.5 billion, while sales in the key North American market are still seen down 30% for the year, according to a statement Thursday.
At the same time, the backdrop is shifting with hotter inflation and a risk of tariffs under President Donald Trump. Duties on US imports of steel and aluminum will raise production costs while any retaliatory tariffs from America’s trading partners could hit demand for agricultural goods and limit purchasing power from farmers.
Deere shares were down 4.5% in pre-market trading as of 7:13 a.m. in New York, after dropping more than 8% earlier.
Still, Deere reported first-quarter net income of $869 million, above an estimate for $848.7 million, and the company indicated there are signs that efforts to reduce production and control inventory of used equipment were working.
“Deere’s performance in the first quarter highlights our continued focus on optimizing inventory,” Chief Executive Officer John May said in a Thursday statement. “We’re seeing compelling evidence that our efforts are positioning the company to successfully navigate the current environment.”
The company has been introducing high-tech equipment, such as plows, sprayers and mowers that can operate without a driver, in a bid to entice farmers to upgrade their machinery.
Overall, American farm income is expected to rise for the first time in three years in 2025 but much of the gains are linked to government assistance, according to the US Department of Agriculture.
(Updates share move and adds more details on tariffs.)
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