Deere's Profit Outlook Cut Due to Farm Equipment Demand and Borrowing Costs
Deere & Co cut its 2024 profit forecast due to farmers' reluctance to make big equipment purchases amid high borrowing rates and falling crop prices, leading to a 5.4% drop in its shares. The company expects net income for fiscal 2024 to be $7.50 billion to $7.75 billion, below analysts' predictions. Demand for farm equipment is anticipated to be weaker in Central and Eastern Europe due to ongoing conflict in Ukraine and extreme weather conditions impacting crop yields. Deere plans to manage inventory levels and cut equipment production in 2024 while operating margins contracted due to lower sales of large agriculture equipment.