Deere Lifts 2026 Net Income Floor to $4.75 Billion as Profit Grows 7%

Deere & Company (DE ) reported net income of $1.379 billion for the third quarter ended August 2, 2026, or $5.10 per diluted share, up from $1.289 billion, or $4.75 per share, a year earlier, and raised the bottom end of its full-year profit forecast for the first time since February 2026.

The Moline, Illinois-based equipment maker now expects fiscal 2026 net income attributable to Deere of $4.75 billion to $5.00 billion, according to its earnings release filed with the SEC. That lifts a floor that had stood at $4.5 billion through the first half of the year while leaving the top of the range untouched. Worldwide net sales and revenues rose 5% to $12.608 billion in the quarter; net sales alone were $10.999 billion, against $10.357 billion in the quarter ended July 27, 2025.

For the first nine months of the fiscal year, net income of $3.808 billion, or $14.06 per share, still trails the prior year’s $3.962 billion, or $14.57 per share, even with revenues up 7% to $35.589 billion. The recovery underway in Deere’s smaller equipment lines has not yet offset the downturn in large farm machinery.

“As we look ahead, we continue to believe 2026 will mark the bottom of the current ag equipment cycle,” chairman and chief executive officer John C. May said in the release, citing early order-program trends, improving used-equipment inventories, and rising customer adoption of the company’s precision technology.

May described U.S. market conditions as stable and said Deere managed softer conditions in Brazil and Europe. The release’s own industry outlook has U.S. and Canadian large-agriculture demand down 15% to 20% for fiscal 2026 in unit terms, with South American tractor and combine demand down the same amount.

Small Ag and Construction Carry the Quarter as Large Ag Falls

The segment detail shows where the quarter’s growth came from. Production & Precision Agriculture, Deere’s large farm equipment business and its biggest profit pool, saw net sales fall 6% to $3.998 billion and operating profit fall 9% to $527 million, a 13.2% operating margin against 13.6% a year earlier. Over nine months the segment’s operating profit is down 34%, to $1.372 billion from $2.066 billion, the clearest measure in the filing of how deep the large-ag downturn has run.

Small Agriculture & Turf moved the other way: net sales up 12% to $3.383 billion and operating profit up 28% to $622 million, an 18.4% margin versus 16.0%. Construction & Forestry delivered the quarter’s largest swing, with net sales up 18% to $3.618 billion and operating profit up 84% to $436 million, an improvement Deere attributes primarily to favorable price realization. Financial Services added net income of $219 million, up from $205 million, on favorable financing spreads that partly offset a smaller average portfolio.

In total, operating profit across the segments rose 18% to $1.856 billion. Deere defines operating profit as income from continuing operations before corporate expenses, certain interest and foreign-exchange items, and income taxes; a tax provision of $529 million, against $339 million a year earlier, is what narrowed that 18% operating gain into the 7% increase in reported net income.

How Deere’s 2026 Guidance Moved Through the Year

The raised floor is the third distinct guidance event of Deere’s fiscal year. On February 19, 2026, alongside first-quarter net income of $656 million, the company increased its full-year range to $4.5 billion to $5.0 billion as order books strengthened. On May 21, 2026, it held that range unchanged after a second quarter in which net income dipped 2% to $1.773 billion. The August 20, 2026 revision keeps the $5.0 billion ceiling and raises only the floor, narrowing the range Deere is committing to with one quarter left in its fiscal year.

A forecast remains a projection, and the release carries the company’s standard caution that results could differ materially. What the filing records is the direction of management’s own revisions: up, then flat, then up again.

Deere’s Third Quarter by the Numbers

• Net income: $1.379 billion, up 7% ($5.10 per diluted share versus $4.75)
• Net sales and revenues: $12.608 billion, up 5%
• Fiscal 2026 net income forecast: $4.75 billion to $5.00 billion, floor raised from $4.5 billion
• Production & Precision Ag operating profit: $527 million, down 9%
• Small Ag & Turf operating profit: $622 million, up 28%
• Construction & Forestry operating profit: $436 million, up 84%
• Tariff recoveries recorded: $110 million in the quarter, $382 million over nine months
• Share repurchases over nine months: $697 million, down from $1.136 billion a year earlier

What the Filing Adds Beyond the Headline Figures

The tariff line cuts both ways in this report. Deere recorded tariff recoveries of $110 million in the quarter and $382 million over nine months, while the release notes that tariff costs sit primarily inside production costs across its segments, one of the drags on Production & Precision Ag margins.

Comparability with the prior-year quarter also carries a footnote. Deere’s third quarter of 2025 absorbed a $61 million pretax non-cash impairment, $49 million after tax, tied mainly to trade-name and customer-relationship assets of external overseas battery operations. No equivalent special item appears in the 2026 quarter.

Two capital-allocation data points round out the filing. Deere completed its $439 million acquisition of Tenna, a U.S. construction-technology company, in February 2026, assigning it to Construction & Forestry, the segment now producing the company’s fastest profit growth. And the nine-month cash-flow statement shows repurchases of $697 million against $1.136 billion in the prior-year period, while dividends paid rose to $1.316 billion from $1.282 billion at an unchanged $1.62 per share per quarter.

What Comes Next for Deere’s 2026

Deere’s segment forecasts for the fiscal year, published with its earnings-call presentation, map the two-speed business. Production & Precision Ag net sales are forecast down roughly 10% at an 11% to 12% operating margin. Small Ag & Turf is forecast up roughly 15% at a 14.5% to 15.5% margin, and Construction & Forestry up roughly 20% at a 10.5% to 11.5% margin. Financial Services net income is forecast around $870 million for the year, against $890 million in fiscal 2025. The company also projects equipment-operations operating cash flow of $5.0 billion to $5.5 billion, capital expenditures of about $1.3 billion, and an effective tax rate of 24% to 26%.

Novonesis approved a €1 billion inaugural buyback as 8% first-half organic growth lifted its 2026 outlook in results published August 20, 2026.

Deere’s fourth-quarter 2026 earnings call is scheduled for 9:00 a.m. Central time on November 25, 2026, the first checkpoint on whether early order-program trends hold through the fall and convert the narrowed $4.75 billion to $5.00 billion forecast into a reported result.