11/27/2025
Deere & Company (NYSE:DE) shares slid on Wednesday as the agricultural equipment giant warned of a $1.2 billion tariff hit in fiscal 2026, overshadowing a fourth-quarter earnings beat.
Despite reporting topping earnings estimates, Deere issued a cautious outlook for the coming year. The company expects net income to fall to between $4.0 billion and $4.75 billion, down from over $5 billion in fiscal 2025.
Management attributed the weaker forecast to declining demand in the large agriculture sector and a sharp rise in trade-related costs.
Christopher Seibert, Manager of Investor Communications, quantified the trade headwinds embedded in the new guidance during the earnings call.
"Included in this estimate is projected pretax direct tariff expense of approximately $1.2 billion, with additional inflationary pressures also contemplated from the indirect impacts of tariffs," Seibert said.
Investor Relations Director Josh Beal later clarified that this represents a $600 million incremental increase from 2025 levels.