Q4 2023 Earnings Summary
Reported on Nov 22, 2023 (Before Market Open)
Pre-Earnings Price$382.65Last close (Nov 21, 2023)
Post-Earnings Price$360.98Open (Nov 22, 2023)
Price Change
$-21.67(-5.66%)
- John Deere achieved record financial performance in 2023, with operating margins just shy of 22% and generating nearly $12 billion in operating cash flow.
- The company expects to maintain structural gains in profitability in 2024, delivering nearly 2x the margin and 2.5x the net income compared to the last mid-cycle period, despite a decline in demand.
- Significant investments in R&D and technology continue, with the company maintaining the highest level of R&D and new product-related CapEx in its history, emphasizing confidence in its strategy and future growth.
- Deere & Company expects lower demand in fiscal year 2024 due to shifting agricultural market dynamics, leading to a decline in sales, particularly in the large ag equipment segment.
- The company anticipates a double-digit decrease in combine volumes for 2024, with early orders expected to be down double digits compared to 2023.
- Elevated interest rates are causing caution in residential and commercial sectors, and industry sales for earthmoving equipment in the U.S. and Canada are expected to be down 5% to 10%, while global forestry markets are forecasted to be down around 10%, potentially impacting Deere's construction and forestry business.
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