Deere & Company (NYSE: NYSE:DE ) traded sharply lower after releasing Q3 CY2025 results that showed strong revenue growth but weakening margins and softer forward guidance. The stock closed at $498.13 and dropped more than 5% after market open, falling to $478.78 pre-market. Management cut full-year earnings expectations, signaling continued pressure across agriculture and construction markets.
Revenue for Q3 reached $12.39 billion, beating estimates and rising 33.6% year over year. EPS of $3.93 also topped expectations but declined from $4.55 last year, highlighting ongoing cost pressures. Deere reduced its FY25 earnings outlook to $4.00–$4.75 billion, well below the market’s $5 billion expectation. Executives cited slow demand, elevated inventory levels, and weakness in large-equipment spending.
Long-term trends show deceleration. Revenue grew at 5.4% annually over the last five years, but the past two years saw declines of 14.4% annually. All segments—Production & Precision Agriculture, Construction & Forestry, and Small Agriculture & Turf—posted year-on-year revenue drops. Despite this, the latest quarter showed a recovery in activity, and analysts expect 14% revenue growth next year.
Margins remain a concern. Deere’s five-year average operating margin of 19.9% narrowed significantly. Q3 margin fell to 10.9%, down from 15.6% a year ago. Free-cash-flow margin also tightened sharply, falling from 47.4% to 14.3%. While buybacks helped EPS growth over the past decade, earnings have weakened for two consecutive years.
Management expects FY26 to mark the bottom of the agriculture cycle, projecting net income of $4.00–$4.75 billion. Markets reacted cautiously as guidance cut overshadowed the Q3 beat.
Technically, DE trades around $471 near an ascending trendline. Key support sits at $413, while major resistance remains at $533. A breakout above $533 would confirm recovery momentum.