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Deere & Company

02/26/2026 | Press release | Distributed by Public on 02/26/2026 08:21

Quarterly Report for Quarter Ending February 1, 2026 (Form 10-Q)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

RESULTS OF OPERATIONS

All amounts are presented in millions of U.S. dollars unless otherwise specified.

OVERVIEW

Organization

Deere & Company is a global leader in the production of agricultural, turf, construction, and forestry equipment and solutions. John Deere Financial provides financing for John Deere equipment, parts, services, and other inputs customers need to run their operations. Our operations are managed through the Production & Precision Agriculture (PPA), Small Agriculture & Turf (SAT), Construction & Forestry (CF), and Financial Services operating segments. References to "equipment operations" include PPA, SAT, and CF, while references to "agriculture and turf" include both PPA and SAT.

Trends and Economic Conditions

Industry Sales Outlook for Fiscal Year 2026

Agriculture and Turf

Construction and Forestry

Company Trends

Our Leap Ambitions, a set of focused goals designed to guide the implementation of our Smart Industrial Operating Model, feature multi-year financial and operational goals, emphasizing the use of our differentiated equipment and service solutions, including automation, autonomy, digitalization, lifecycle solutions, and Solutions as a Service (SaaS).

Deeper integration of technology into equipment to enable customers to do more with less remains a persistent market trend. Customers seek to improve profitability, productivity, and sustainability by selecting our equipment and technology solutions. These technologies are incorporated into customer operations across the varied production systems in which we serve. While we continue to benefit from the adoption of these technologies, revenue from SaaS products did not represent a significant percentage of our revenues in the periods presented.

Company Outlook for 2026

Large agriculture sales in North America are expected to remain subdued and soften in South America resulting in decreased sales volume for PPA in 2026 compared to 2025. SAT and CF sales are expected to improve in 2026. Our net sales are expected to increase in 2026 compared to 2025 with the anticipated decline in PPA sales, more than offset by improvements in CF and SAT.

Agriculture and Turf Industry Outlook for 2026

●

Demand in the U.S. and Canada for large agriculture equipment is expected to decrease compared to 2025 levels amid challenging farm fundamentals for row crop farmers. These factors are expected to be partially offset by strong crop production, robust demand for commodities, and normalizing global crop trade flows. In addition, government programs continue to support farmers' short-term liquidity. Ongoing improvements in the used inventory market and the increase in age of used equipment are providing a better environment for machine replacement demand.

●

We expect small agricultural and turf equipment sales to be flat to up slightly from 2025 levels in the U.S. and Canada. The dairy and livestock market continues to generate profits driven by strong beef prices. A modest recovery is anticipated in the turf sector following several years of contraction.

●

In Europe, the industry is forecasted to be flat to up slightly despite recent declines in milk prices, supported by a steady interest rate environment, manageable long-term financing costs, and resilient crop yields.

●

Demand in South America is expected to be down slightly driven by the Brazilian market where subdued commodity prices, high interest rates, and a stronger Brazilian real are putting pressure on farmer margins.

●

Industry sales in Asia are forecasted to be flat to down slightly.

Construction and Forestry Industry Outlook for 2026

●

Industry sales in the U.S. and Canada for earthmoving and compact construction equipment are projected to be slightly higher compared to 2025. U.S. government infrastructure spending, declining interest rates, strong rental equipment demand, and data center construction activity continue to provide a solid foundation for the industry.

●

Global forestry markets are expected to be flat.

●

Global roadbuilding markets are forecasted to be up slightly compared to 2025 driven by market growth in North America and Europe.

Financial Services Outlook for 2026


Net Income				Down
(-) Average portfolio				Unfavorable
(-) Prior period special items				Unfavorable
+ Provision for credit losses				Favorable
+ Financing spreads				Favorable

Additional Trends

Agricultural Market Business Cycle.The agricultural market is affected by various factors including commodity prices, acreage planted, crop yields, government policies, and uncertainty in macroeconomic trends. These factors affect farmers' income and sentiment which may result in varying demand for our equipment. In 2026, we may experience the following effects due to unfavorable market conditions: lower sales volumes, higher sales incentives, and elevated receivable write-offs.

Global Trade Policies.In 2025, new tariffs were imposed in the U.S. for imports from a broad range of countries and on certain materials. Several countries also implemented retaliatory tariffs on imports from the U.S. and introduced additional trade barriers. Trade policies impact us in various ways. We are a net exporter of agriculture and turf equipment from the U.S. Nearly 75% of our domestic sales are assembled in the U.S., with the remaining products imported primarily from Europe, Mexico, India, and Japan. Incremental import tariffs adversely affected the cost of our products and components beginning in the third quarter of 2025 and are expected to continue to do so in 2026. The direct impact of incremental tariffs incurred by us was $361 in the first quarter of 2026, excluding the impact of tariffs on our suppliers and market demand. Trade policies are evolving, causing uncertainty in the agriculture and construction industries. We are actively taking steps to mitigate potential impacts on our business, to the extent possible.

On February 20, 2026, the United States Supreme Court issued a decision invalidating tariffs imposed under the International Emergency Economic Powers Act (IEEPA). This decision may provide tariff relief and the potential recovery of amounts previously paid. We are currently evaluating the impact of this decision on our future financial statements.

Changes in the agricultural market business cycle and global trade policies are driven by factors outside of our control, and as a result, we cannot reasonably foresee when these conditions may subside.

Legal Proceeding - On January 15, 2025, the Federal Trade Commission (FTC), along with the Attorneys General of the States of Illinois and Minnesota filed a lawsuit against us in the United States District Court for the Northern District of Illinois Western Division. The Attorneys General of the States of Arizona, Michigan, and Wisconsin joined the lawsuit. The lawsuit alleges monopolization and unfair competition in violation of the federal and state antitrust laws. Plaintiffs seek a permanent injunction and other equitable relief to allow owners of our equipment, as well as independent repair providers, access to our repair tools and any other repair resources available to authorized John Deere dealers. We are in preliminary discussions with the FTC with respect to a potential resolution. At this stage, we are unable to estimate the potential impact on our business.

Other Items of Concern and Uncertainties -Other items that could impact our results are:

●

global and regional political conditions

●

shifts in energy, including positions with respect to biofuels, economic, and positions on government subsidies of farming

●

capital market disruptions

●

foreign currency and capital control policies

●

right to repair regulations and legislation

●

weather conditions

●

marketplace pace of adoption and monetization of technologies we have invested in

●

our ability to strengthen our digital capabilities, artificial intelligence, automation, and autonomy

●

changes in demand and pricing for new and used equipment

●

delays or disruptions in our supply chain

●

significant fluctuations in foreign currency exchange rates

●

volatility in the prices of many commodities

●

slower economic growth

consolidated results - 2026 Compared with 2025


	Three Months Ended
Deere & Company	February 1		January 26
(In millions of dollars, except per share amounts)	2026		2025
Net sales and revenues	$	9,611	$	8,508
Net income attributable to Deere & Company		656		869
Diluted earnings per share		2.42		3.19

Net sales and revenues increased 13% for the quarter, primarily due to higher sales volumes of $988 and the positive effects of foreign currency translation of $227. Net income decreased $213, primarily due to incremental tariffs of $272 ($361 pretax) and prior period favorable discrete tax items of $163 described in Note 21, partially offset by the impact of higher shipment volumes of $188 ($249 pretax). The discussion of segment net sales and operating profit is included in the Business Segment Results below.

An explanation of the cost of sales to net sales ratio and other significant statement of consolidated income changes follows:


	Three Months Ended
	February 1		January 26
Deere & Company	2026		2025		% Change
Cost of sales to net sales		78.5%		74.0%
(-) Tariffs					Unfavorable
(+) Production efficiencies					Favorable
Increased mostly due to incremental tariffs, partially offset by production efficiencies resulting from increased manufacturing volumes.

Other income	$	267	$	246	+9
Higher due to increased income earned from extended warranty premiums and higher service revenues.

Research and development expenses		554		526	+5
Increased due to continued focus on developing and deploying technology solutions.

Interest expense		719		829	-13
Decreased due to lower average borrowing rates and lower average borrowings.

Provision for income taxes		196		27	+626
Increased due to favorable discrete tax adjustments recognized in the prior period (see Note 21).

Business Segment Results - 2026 compared with 2025

The equipment operations segment results were impacted by incremental tariffs in 2026. The change in tariff costs was included in the "Production Costs" category below.


	Three Months Ended
	February 1		January 26
Production & Precision Agriculture	2026		2025		% Change
Net sales	$	3,163	$	3,067	+3
Operating profit		139		338	-59
Operating margin		4.4%		11.0%
Price realization
Currency translation impact on Net sales					+4

Production & Precision Agriculture sales increased for the quarter as a result of the positive effects of foreign currency translation (primarily the Euro and Brazilian real). Operating profit decreased primarily due to higher tariffs, unfavorable sales mix, and higher warranty expenses.

Production & Precision Agriculture Operating Profit

First Quarter 2026 Compared to First Quarter 2025


	Three Months Ended
	February 1		January 26
Small Agriculture & Turf	2026		2025		% Change
Net sales	$	2,168	$	1,748	+24
Operating profit		196		124	+58
Operating margin		9.0%		7.1%
Price realization					+2
Currency translation impact on Net sales					+2

Small Agriculture & Turf sales increased for the quarter due to higher shipment volumes (primarily in the U.S., Canada, Europe, and India) driven by increased customer demand. Sales also increased as a result of the positive impact of the Euro foreign currency translation. Operating profit increased primarily as a result of higher shipment volumes and price realization, partially offset by higher tariffs.

Small Agriculture & Turf Operating Profit

First Quarter 2026 Compared to First Quarter 2025


	Three Months Ended
	February 1		January 26
Construction & Forestry	2026		2025		% Change
Net sales	$	2,670	$	1,994	+34
Operating profit		137		65	+111
Operating margin		5.1%		3.3%
Price realization
Currency translation impact on Net sales					+4

Construction & Forestry sales increased for the quarter due to higher U.S. shipment volumes, driven by increased customer demand from a strong construction market. Additionally, sales increased as a result of the positive impacts of the Euro foreign currency translation. Operating profit increased primarily due to higher shipment volumes and production efficiencies, partially offset by higher tariffs.

Construction & Forestry Operating Profit

First Quarter 2026 Compared to First Quarter 2025


	Three Months Ended
	February 1		January 26
Financial Services	2026		2025		% Change
Revenue (including intercompany)	$	1,488	$	1,573	-5
Interest expense		664		766	-13
Net income		244		230	+6

Revenue decreased primarily due to the deconsolidation of Banco John Deere S.A. (BJD) in the second quarter of 2025 and a 2% lower average balance of receivables and leases portfolio compared to the same period last year. Interest expense decreased as a result of lower average borrowing rates and lower average borrowings. Net income for the quarter increased primarily due to favorable financing spreads and a lower provision for credit losses, partially offset by the prior period decreased valuation allowance on BJD "Assets held for sale" (see Note 21).

Critical Accounting Estimates

See our critical accounting estimates discussed in the Management's Discussion and Analysis of the most recently filed Annual Report on Form 10-K. There have been no material changes to these policies.

CAPITAL RESOURCES AND LIQUIDITY - 2026 compared with 2025

We have access to global markets at a reasonable cost. Sources of liquidity include:

●

cash, cash equivalents, and marketable securities on hand

●

funds from operations

●

the issuance of commercial paper and term debt

●

the securitization of retail notes

●

bank lines of credit

We closely monitor our cash requirements. Based on the available sources of liquidity, we expect to meet our funding needs in the short term (next 12 months) and long term (beyond 12 months). We are forecasting operating cash flows from equipment operations in 2026 to remain flat compared with 2025 driven by an offsetting decrease in net income adjusted for non-cash provisions, and higher cash flows generated from inventory reductions.

We operate in multiple industries, which have unique funding requirements. The equipment operations are capital intensive. Historically, these operations have been subject to seasonal variations in financing requirements for inventories and receivables from dealers. The financial services operations rely on their ability to raise substantial amounts of funds to finance their receivable and lease portfolios.

Key metrics are provided in the following table:


	February 1		November 2		January 26
	2026		2025		2025
Cash, cash equivalents, and marketable securities	$	8,196	$	9,687	$	7,815

Trade accounts and notes receivable - net		5,993		5,317		4,931
Ratio to prior 12 month's net sales		15%		14%		12%

Inventories		8,286		7,406		7,744
Ratio to prior 12 month's cost of sales		28%		26%		27%

Unused credit lines		7,159		7,268		7,793

Financial Services:
Ratio of interest-bearing debt to stockholder's equity		8.2 to 1		8.4 to 1		7.6 to 1

There have been no material changes to the contractual obligations and other cash requirements identified in our most recently filed Annual Report on Form 10-K.

Cash Flows


	Three Months Ended
	February 1		January 26
	2026		2025
Net cash used for operating activities	$	(890)	$	(1,132)
Net cash provided by investing activities		1,822		1,416
Net cash used for financing activities		(2,490)		(923)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash		98		(87)
Net decrease in cash, cash equivalents, and restricted cash	$	(1,460)	$	(726)

Cash outflows from consolidated operating activities in the first three months of 2026 were $890. This resulted mainly from the payout of employee profit-sharing incentives, an increase in inventories, and a reduction in dealer sales incentive accruals, partially offset by net income adjusted for non-cash provisions. Cash inflows from investing activities were $1,822 in the first three months of this year. The primary drivers were collections of receivables (excluding receivables related to sales) exceeding the cost of receivables acquired, partially offset by purchases of property and equipment. Cash outflows from financing activities were $2,490 in the first three months of 2026 due to lower borrowings, dividends paid, and repurchases of common stock. Cash returned to shareholders was $743 in the first three months of 2026. Cash, cash equivalents, and restricted cash decreased $1,460 during the first three months of this year.

Key Metrics and Balance Sheet Changes

Trade Accounts and Notes Receivable. Trade accounts and notes receivable arise from sales of goods to customers. Trade receivables increased $676 during the first three months of 2026, and increased $1,062 compared to a year ago, both due to higher sales. The percentage of total worldwide trade receivables outstanding for periods exceeding 12 months was 2% at February 1, 2026, 3% at November 2, 2025, and 6% at January 26, 2025.

Financing Receivables and Equipment on Operating Leases. Financing receivables and equipment on operating leases consist of retail notes originated in connection with financing of new and used equipment, operating leases, revolving charge accounts, sales-type and direct financing leases, and wholesale notes. Financing receivables and equipment on operating leases decreased $2,902 during the first quarter of 2026, primarily due to seasonal payments and lower retail customer receivables, and decreased $706 in the past 12 months due to lower wholesale notes. Total acquisition volumes of financing receivables and equipment on operating leases were 12% higher in the first three months of 2026, compared with the same period last year, as volumes of wholesale notes and revolving charge accounts were higher compared to the same period last year.

Inventories. Inventories increased by $880 during the first three months, primarily due to a seasonal increase. Inventories increased $542 compared to a year ago due to the effects of foreign currency translation. A majority of these inventories are valued on the last-in, first-out (LIFO) method.

Property and Equipment. Property and equipment cash expenditures in the first three months of 2026 were $256, compared with $352 in the same period last year. Capital expenditures in 2026 are estimated to be approximately $1.4 billion.

Accounts Payable and Accrued Expenses. Accounts payable and accrued expenses decreased by $1,376 in the first three months of 2026, primarily due to a decrease in accrued expenses associated with employee benefits and dealer sales incentives. Accounts payable and accrued expenses increased $371 compared to a year ago, due to an increase in accounts payable associated with trade payables, partially offset by a decrease in accrued expenses associated with employee benefits.

Borrowings. Total external borrowings decreased by $1,457 in the first three months of 2026 and decreased $1,902 compared to a year ago, generally corresponding with the level of the receivable and lease portfolio, as well as other working capital requirements.

John Deere Capital Corporation (Capital Corporation), a U.S. financial services subsidiary, has a revolving warehouse facility to utilize bank conduit facilities to securitize retail notes (see Note 10). The facility was renewed in November 2025, with an expiration in November 2026, and with a total capacity or "financing limit" of $2,500. At February 1, 2026, $2,025 of securitization borrowings were outstanding under the facility. At the end of the contractual revolving period, unless the banks and Capital Corporation agree to renew, Capital Corporation would liquidate the secured borrowings over time as payments on the retail notes are collected.

In the first three months of 2026, the financial services operations issued $659 and retired $974 of retail note securitization borrowings, which are presented in "Net proceeds (payments) in total short-term borrowings (original maturities three months or less)."

Lines of Credit. We also have access to bank lines of credit with various banks throughout the world.

Worldwide lines of credit totaled $12.2 billion at February 1, 2026, consisting primarily of:

●

a 364-day credit facility agreement of $5.0 billion expiring in the second quarter of 2026

●

a credit facility agreement of $3.25 billion expiring in the second quarter of 2028

●

a credit facility agreement of $3.25 billion expiring in the second quarter of 2030

At February 1, 2026, $7.2 billion of these worldwide lines of credit were unused. For the purpose of computing unused credit lines, commercial paper and short-term bank borrowings were considered to constitute utilization. These credit agreements require Capital Corporation and other parts of our business to maintain certain performance metrics and liquidity targets. All requirements in the credit agreements have been met during the periods included in the financial statements.

Debt Ratings. To access public debt capital markets, we rely on credit rating agencies to assign short-term and long-term credit ratings to our debt securities as an indicator of credit quality for fixed income investors. A security rating is not a recommendation by the rating agency to buy, sell, or hold our securities. A credit rating agency may change or withdraw ratings based on its assessment of our current and future ability to meet interest and principal repayment obligations. Each agency's rating should be evaluated independently of any other rating. Lower credit ratings generally result in higher borrowing costs, including costs of derivative transactions, reduced access to debt capital markets, and may adversely impact our liquidity. The senior long-term and short-term debt ratings and outlook currently assigned to unsecured company securities by the rating agencies engaged by us are as follows:


	Senior
	Long-Term	Short-Term	Outlook
Fitch Ratings	A+	F1	Stable
Moody's Investors Service, Inc.	A1	Prime-1	Stable
Standard & Poor's	A	A-1	Stable

FORWARD-LOOKING STATEMENTS

Certain statements contained herein, including in the section entitled "Overview," "Trends and Economic Conditions," and "Condensed Notes to Interim Consolidated Financial Statements" relating to future events, expectations, and trends constitute "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995 and involve factors that are subject to change, assumptions, risks, and uncertainties that could cause actual results to differ materially. Some of these risks and uncertainties could affect all lines of our operations generally while others could more heavily affect a particular line of business.

Forward-looking statements are based on currently available information and current assumptions, expectations, and projections about future events and should not be relied upon. Except as required by law, we expressly disclaim any obligation to update or revise our forward-looking statements. Many factors, risks, and uncertainties could cause actual results to differ materially from these forward-looking statements. Among these factors are risks related to:

●

the agricultural business cycle, which can be unpredictable and is affected by factors such as farm income, international trade, world grain stocks, crop yields, available farm acres, soil conditions, prices for commodities and livestock, input costs, government farm programs, availability of transport for crops as well as adverse macroeconomic conditions, including unemployment, inflation, interest rate volatility, changes in consumer practices due to slower economic growth or a recession, and regional or global liquidity constraints

●

the uncertainty of government policies and actions with respect to the global trade environment including increased and proposed tariffs announced by the U.S. government and retaliatory trade regulations

●

political, economic, and social instability in the geographies in which we operate

●

worldwide demand for food and different forms of renewable energy impacting the price of farm commodities and consequently the demand for our equipment

●

rationalization, restructuring, relocation, expansion, and/or reconfiguration of manufacturing and warehouse facilities

●

accurately forecasting customer demand for products and services and adequately managing inventory

●

uncertainty of our ability to sell products domestically or internationally, manage increased costs of production, absorb or pass on increased expenses, and accurately predict financial results and industry trends

●

availability and price of raw materials, components, and whole goods

●

delays or disruptions in our supply chain

●

changes in climate patterns, unfavorable weather events, and natural disasters

●

suppliers' and manufacturers' business practices and compliance with applicable laws such as human rights, safety, environmental, and fair wages

●

higher interest rates and currency fluctuations which could adversely affect the U.S. dollar, customer confidence, access to capital, and demand for our products and solutions

●

the ability to attract, develop, engage, and retain qualified employees

●

ability to adapt in highly competitive markets, including understanding and meeting customers' changing expectations for products and solutions, including delivery and utilization of precision technology

●

the ability to execute business strategies, including our Smart Industrial Operating Model and refined Leap Ambitions

●

dealer practices and their ability to manage new and used inventory, distribute our products, and to provide support and service for precision technology solutions

●

the ability to realize anticipated benefits of acquisitions and joint ventures, including challenges with successfully integrating operations and internal control processes

●

negative claims or publicity that damage our reputation or brand

●

the impact of workforce reductions on company culture, employee retention and morale, and institutional knowledge

●

labor relations and contracts, including work stoppages and other disruptions

●

security breaches, cybersecurity attacks, technology failures, and other disruptions to our information technology infrastructure and products

●

leveraging artificial intelligence and machine learning within our business processes

●

changes to existing laws and regulations, including the implementation of new, more stringent laws, as well as compliance with a variety of U.S., foreign, and international laws, regulations, and policies relating to, but not limited to the following: advertising, anti-bribery and anti-corruption, anti-money laundering, antitrust, consumer finance, cybersecurity, data privacy, encryption, environmental (including climate change and engine emissions), farming, foreign exchange controls and cash repatriation restrictions, foreign ownership and investment, health and safety, human rights, import / export and trade, labor and employment, product liability, tariffs, tax, telematics, and telecommunications

●

governmental and other actions designed to address climate change in connection with a transition to a lower-carbon economy

●

warranty claims, post-sales repairs or recalls, product liability litigation, and regulatory investigations because of the deficient operation of our products

●

investigations, claims, lawsuits, or other legal proceedings, including the lawsuit filed by the Federal Trade Commission (FTC) and the Attorneys General of the States of Arizona, Illinois, Michigan, Minnesota, and Wisconsin alleging that we unlawfully withheld self-repair capabilities from farmers and independent repair providers

●

loss of or challenges to intellectual property rights

Further information concerning us and our businesses, including factors that could materially affect our financial results, is included in our other filings with the SEC (including, but not limited to, the factors discussed in Item 1A. "Risk Factors" of our most recent Annual Report on Form 10-K and this Quarterly Report on Form 10-Q). There also may be other factors that we cannot anticipate or that are not described herein because we do not currently perceive them to be material.

SUPPLEMENTAL CONSOLIDATING DATA

The supplemental consolidating data presented on the subsequent pages is presented for informational purposes. Equipment operations represent the enterprise without Financial Services. Equipment operations include Production & Precision Agriculture operations, Small Agriculture & Turf operations, Construction & Forestry operations, and other corporate assets, liabilities, revenues, and expenses not reflected within Financial Services. Transactions between the equipment operations and Financial Services have been eliminated to arrive at the consolidated financial statements.

Equipment operations and Financial Services participate in different industries. Equipment operations primarily generate earnings and cash flows by manufacturing and selling equipment, service parts, and technology solutions to dealers and retail customers. Financial Services finance sales and leases by dealers of new and used equipment that is largely manufactured by equipment operations. Those earnings and cash flows generally are the difference between the finance income received from customer payments less interest expense, and depreciation on equipment subject to an operating lease. The two businesses are capitalized differently and have separate performance metrics. The supplemental consolidating data is also used by management due to these differences.


DEERE & COMPANY
SUPPLEMENTAL CONSOLIDATING DATA
STATEMENTS OF INCOME
For the Three Months Ended February 1, 2026 and January 26, 2025
Unaudited
	EQUIPMENT				FINANCIAL
	OPERATIONS				SERVICES				ELIMINATIONS				CONSOLIDATED
	2026		2025		2026		2025		2026		2025		2026		2025
Net Sales and Revenues
Net sales	$	8,001	$	6,809									$	8,001	$	6,809
Finance and interest income		120		110	$	1,351	$	1,455	$	(128)	$	(112)		1,343		1,453	¹
Other income		213		202		137		118		(83)		(74)		267		246	^{2, 3, 4}
Total		8,334		7,121		1,488		1,573		(211)		(186)		9,611		8,508

Costs and Expenses
Cost of sales		6,291		5,045						(11)		(8)		6,280		5,037	⁴
Research and development expenses		554		526										554		526
Selling, administrative and general expenses		806		800		168		174		(2)		(2)		972		972	⁴
Interest expense		93		84		664		766		(38)		(21)		719		829	¹
Interest compensation to Financial Services		90		91						(90)		(91)					¹
Other operating expenses		(46)		(51)		366		364		(70)		(64)		250		249	^{3, 4, 5}
Total		7,788		6,495		1,198		1,304		(211)		(186)		8,775		7,613

Income before Income Taxes		546		626		290		269						836		895
Provision (credit) for income taxes		134		(13)		62		40						196		27

Income after Income Taxes		412		639		228		229						640		868
Equity in income (loss) of unconsolidated affiliates		(1)		(2)		16		1						15		(1)

Net Income		411		637		244		230						655		867
Less: Net loss attributable to noncontrolling interests		(1)		(2)										(1)		(2)
Net Income Attributable to Deere & Company	$	412	$	639	$	244	$	230					$	656	$	869

¹Elimination of intercompany interest income and expense.

² Elimination of equipment operations' margin from inventory transferred to equipment on operating leases.

³ Elimination of income and expenses between equipment operations and Financial Services related to intercompany guarantees of investments in certain international markets.

⁴ Elimination of intercompany service revenues and fees.

⁵ Elimination of Financial Services' lease depreciation expense related to inventory transferred to equipment on operating leases.


DEERE & COMPANY
SUPPLEMENTAL CONSOLIDATING DATA (Continued)
CONDENSED BALANCE SHEETS
Unaudited
	EQUIPMENT						FINANCIAL
	OPERATIONS						SERVICES						ELIMINATIONS						CONSOLIDATED
	Feb 1		Nov 2		Jan 26		Feb 1		Nov 2		Jan 26		Feb 1		Nov 2		Jan 26		Feb 1		Nov 2		Jan 26
	2026		2025		2025		2026		2025		2025		2026		2025		2025		2026		2025		2025
Assets
Cash and cash equivalents	$	4,769	$	6,340	$	4,840	$	2,029	$	1,936	$	1,761							$	6,798	$	8,276	$	6,601
Marketable securities		146		217		114		1,252		1,194		1,100								1,398		1,411		1,214
Receivables from Financial Services		4,132		4,649		1,826							$	(4,132)	$	(4,649)	$	(1,826)							⁶
Trade accounts and notes receivable - net		1,284		1,316		1,053		6,609		5,900		5,812		(1,900)		(1,899)		(1,934)		5,993		5,317		4,931	⁷
Financing receivables - net		105		88		78		42,008		44,487		41,318								42,113		44,575		41,396
Financing receivables securitized - net				1		2		6,479		6,830		8,255								6,479		6,831		8,257
Other receivables		1,841		1,809		2,367		621		658		654		(51)		(64)		(42)		2,411		2,403		2,979	⁸
Equipment on operating leases - net								7,512		7,600		7,157								7,512		7,600		7,157
Inventories		8,286		7,406		7,744														8,286		7,406		7,744
Property and equipment - net		8,053		8,047		7,392		31		32		33								8,084		8,079		7,425
Goodwill		4,280		4,188		3,872														4,280		4,188		3,872
Other intangible assets - net		880		892		937														880		892		937
Retirement benefits		3,282		3,181		2,933		98		94		86		(2)		(2)		(1)		3,378		3,273		3,018
Deferred income taxes		2,476		2,507		2,247		45		46		42		(253)		(269)		(437)		2,268		2,284		1,852	⁹
Other assets		2,371		2,218		2,295		1,220		1,244		539		(35)		(1)		(27)		3,556		3,461		2,807
Assets held for sale												2,929												2,929
Total Assets	$	41,905	$	42,859	$	37,700	$	67,904	$	70,021	$	69,686	$	(6,373)	$	(6,884)	$	(4,267)	$	103,436	$	105,996	$	103,119

Liabilities and Stockholders' Equity

Liabilities
Short-term borrowings	$	366	$	414	$	1,101	$	14,026	$	13,382	$	11,710							$	14,392	$	13,796	$	12,811
Short-term securitization borrowings				1		1		6,283		6,595		8,013								6,283		6,596		8,014
Payables to equipment operations								4,132		4,649		1,826	$	(4,132)	$	(4,649)	$	(1,826)							⁶
Accounts payable and accrued expenses		11,387		12,757		10,869		3,132		3,116		3,296		(1,986)		(1,964)		(2,003)		12,533		13,909		12,162	^{7, 8}
Deferred income taxes		343		347		405		344		356		480		(253)		(269)		(437)		434		434		448	⁹
Long-term borrowings		8,897		8,756		8,507		32,907		34,788		35,049								41,804		43,544		43,556
Retirement benefits and other liabilities		1,568		1,646		1,668		67		66		67		(2)		(2)		(1)		1,633		1,710		1,734
Liabilities held for sale												1,830												1,830
Total liabilities		22,561		23,921		22,551		60,891		62,952		62,271		(6,373)		(6,884)		(4,267)		77,079		79,989		80,555

Commitments and contingencies (Note 17)
Redeemable noncontrolling interest		50		51		78														50		51		78

Stockholders' Equity
Total Deere & Company stockholders' equity		26,300		25,950		22,479		7,013		7,069		7,415		(7,013)		(7,069)		(7,415)		26,300		25,950		22,479	¹⁰
Noncontrolling interests		7		6		7														7		6		7
Financial Services' equity		(7,013)		(7,069)		(7,415)								7,013		7,069		7,415							¹⁰
Adjusted total stockholders' equity		19,294		18,887		15,071		7,013		7,069		7,415								26,307		25,956		22,486
Total Liabilities and Stockholders' Equity	$	41,905	$	42,859	$	37,700	$	67,904	$	70,021	$	69,686	$	(6,373)	$	(6,884)	$	(4,267)	$	103,436	$	105,996	$	103,119

⁶Elimination of receivables / payables between equipment operations and Financial Services.

⁷Primarily reclassification of sales incentive accruals on receivables sold to Financial Services.

⁸Reclassification of other receivables / payables.

⁹Reclassification of deferred tax assets / liabilities in the same taxing jurisdictions.

¹⁰ Elimination of Financial Services' equity.


DEERE & COMPANY
SUPPLEMENTAL CONSOLIDATING DATA (Continued)
STATEMENTS OF CASH FLOWS
For the Three Months Ended February 1, 2026 and January 26, 2025
Unaudited
	EQUIPMENT				FINANCIAL
	OPERATIONS				SERVICES				ELIMINATIONS				CONSOLIDATED
	2026		2025		2026		2025		2026		2025		2026		2025
Cash Flows from Operating Activities
Net income	$	411	$	637	$	244	$	230					$	655	$	867
Adjustments to reconcile net income to net cash provided by (used for) operating activities:
Provision for credit losses		1		3		35		66						36		69
Depreciation and amortization		342		319		274		265	$	(26)	$	(35)		590		549	¹¹
Impairments and other adjustments								(32)								(32)
Share-based compensation expense										41		28		41		28	¹²
Distributed earnings of Financial Services		350		162						(350)		(162)					¹³
Provision (credit) for deferred income taxes		29		(17)		(11)		225						18		208
Changes in assets and liabilities:
Receivables related to sales		18		140						332		923		350		1,063	^{14, 16}
Inventories		(728)		(784)						(18)		(11)		(746)		(795)	¹⁵
Accounts payable and accrued expenses		(1,410)		(2,073)		(74)		6		(2)		222		(1,486)		(1,845)	¹⁶
Accrued income taxes payable/receivable		(71)		(479)		(17)		(61)						(88)		(540)
Retirement benefits		(191)		(647)		(3)		(41)						(194)		(688)
Other		(94)		(136)		49		117		(21)		3		(66)		(16)	^{11, 12, 15}
Net cash provided by (used for) operating activities		(1,343)		(2,875)		497		775		(44)		968		(890)		(1,132)

Cash Flows from Investing Activities
Collections of receivables (excluding receivables related to sales)						8,251		8,345		(153)		(208)		8,098		8,137	¹⁴
Proceeds from maturities and sales of marketable securities		75		9		69		52						144		61
Proceeds from sales of equipment on operating leases						377		433						377		433
Cost of receivables acquired (excluding receivables related to sales)						(6,044)		(6,093)		21		48		(6,023)		(6,045)	¹⁴
Purchases of marketable securities						(129)		(141)						(129)		(141)
Purchases of property and equipment		(256)		(352)										(256)		(352)
Cost of equipment on operating leases acquired						(456)		(454)		24		15		(432)		(439)	¹⁵
Decrease in trade and wholesale receivables						198		985		(198)		(985)					¹⁴
Collections of receivables from unconsolidated affiliates						105								105
Collateral on derivatives - net		1				(12)		(191)						(11)		(191)
Other		(33)		(51)		(18)		4						(51)		(47)
Net cash provided by (used for) investing activities		(213)		(394)		2,341		2,940		(306)		(1,130)		1,822		1,416

Cash Flows from Financing Activities
Net proceeds (payments) in short-term borrowings (original maturities three months or less)		(38)		176		886		(1,660)						848		(1,484)
Change in intercompany receivables/payables		613		1,222		(613)		(1,222)
Proceeds from borrowings issued (original maturities greater than three months)		166		2,032		614		1,136						780		3,168
Payments of borrowings (original maturities greater than three months)		(78)		(12)		(3,282)		(1,741)						(3,360)		(1,753)
Repurchases of common stock		(302)		(441)										(302)		(441)
Dividends paid		(441)		(403)		(350)		(162)		350		162		(441)		(403)	¹³
Other		(11)		(7)		(4)		(3)						(15)		(10)
Net cash provided by (used for) financing activities		(91)		2,567		(2,749)		(3,652)		350		162		(2,490)		(923)

Effect of Exchange Rate Changes on Cash, Cash Equivalents, and Restricted Cash		78		(74)		20		(13)						98		(87)

Net Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash		(1,569)		(776)		109		50						(1,460)		(726)
Cash, Cash Equivalents, and Restricted Cash at Beginning of Period		6,364		5,643		2,169		1,990						8,533		7,633
Cash, Cash Equivalents, and Restricted Cash at End of Period	$	4,795	$	4,867	$	2,278	$	2,040					$	7,073	$	6,907

¹¹ Elimination of depreciation on leases related to inventory transferred to equipment on operating leases.

¹² Reclassification of share-based compensation expense.

¹³ Elimination of dividends from Financial Services to the equipment operations, which are included in the equipment operations operating activities.

¹⁴ Primarily reclassification of receivables related to the sale of equipment.

¹⁵ Reclassification of direct lease agreements with retail customers.

¹⁶ Reclassification of sales incentive accruals on receivables sold to Financial Services.

Deere & Company published this content on February 26, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on February 26, 2026 at 14:21 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]

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