New York, Feb 19, 2026, 11:37 EST — Regular session
- Deere shares jumped about 12% after the company raised its full-year profit outlook and topped quarterly estimates.
- Management pointed to a rebound in construction and small-ag demand, while large-ag markets stayed soft.
- Tariff costs and the farm-income outlook remain the main swing factors for the rest of 2026.
Shares of Deere & Company (DE.N) jumped about 12% to $664.61 in late-morning trading on Thursday after the farm and construction equipment maker raised its full-year profit forecast and beat first-quarter expectations.
The move matters because Deere has spent the past year trimming production and leaning on cost cuts as farmers delayed big-ticket buys. Chief executive John May said the company sees 2026 as the bottom of the current cycle, and an Oppenheimer analyst flagged “relatively lean inventories” that could leave room for upside if dealer stock normalizes. (Reuters)
That brighter tone stands out in a sector still dealing with weak farm machinery demand. CNH Industrial, a rival with brands including Case IH and New Holland, warned this week its 2026 profit would undershoot expectations as farmers keep a tight grip on spending. (Reuters)
Deere said first-quarter net income fell to $656 million, or $2.42 per share, from $869 million, or $3.19 per share, a year earlier, even as worldwide net sales and revenues rose 13% to $9.611 billion. “We’re encouraged by the ongoing recovery in demand within both the construction and small agriculture segments,” May said. (Q4 Capital)
Construction & Forestry led the lift, with sales up 34% and operating profit up 111% to $137 million. Small Agriculture & Turf sales rose 24% and operating profit climbed 58% to $196 million, while Production & Precision Agriculture operating profit slid 59% to $139 million as higher tariffs and warranty costs weighed on margins. (Q4 Capital)
In an SEC filing, Deere lifted its fiscal 2026 net income outlook to $4.5 billion to $5.0 billion and raised its sales growth view for both Construction & Forestry and Small Agriculture & Turf to about 15% each. The company kept a cautious stance on its Production & Precision Agriculture business, where it still expects sales to fall 5% to 10%. (SEC)
On the earnings call, the company kept its estimated annual tariff cost at about $1.2 billion on a pre-tax basis — meaning before income taxes — and said projections for cash flow from equipment operations rose by $500 million at both ends of its range, to $4.5 billion to $5.5 billion. (The Motley Fool)
The risk case is straightforward: if crop prices stay low and input costs stay high, farmers can keep postponing machinery purchases, and the large-ag downturn can linger. USDA forecasts net farm income — a broad measure of farm profitability — will edge down 0.7% in 2026 to $153.4 billion. (Economic Research Service)
Traders will be watching for any shifts in tariff policy, dealer inventory levels and order trends as spring buying season approaches, along with whether construction demand holds up if financing conditions change.
The next hard date on investors’ calendars is Deere’s fiscal second-quarter earnings call, scheduled for May 21. (John Deere Investor Relations)
