Deere published its quarterly results on Thursday, reporting $45.6 billion in sales and revenue, a decrease of 11.7% from 2024, which brought in $51.7 billion and a 25% drop from 2023’s $61.2 billion. The company’s equipment operations division had $38.9 billion in net sales for 2025, compared to $44.7 billion in 2024, a 12.9% decrease. The financial report attributed those reductions to declining market conditions. 

Deere’s performance is intertwined with Iowa’s two largest industry sectors, with agriculture representing 22% of state gross domestic product and manufacturing at 17%. The company employs 73,000 people globally and thousands in Iowa, although the number has declined in recent years due to massive layoffs. Demand for agricultural equipment is down as the agricultural economy has lagged for several years, exacerbated this year due to tariffs and changing trade policies. Deere estimates that tariffs will have a 2025 price tag of $600 million. 

Tariffs

The report provides detail on how tariffs have affected the company this year.

“The imposition of tariffs and retaliatory tariffs has impacted, and we expect will continue to impact, the sourcing of parts and components, the cost and profitability of manufacturing operations, and our ability to ship, import and export our products,” the report stated. 

Not only did the U.S. impose tariffs on other countries’ exports, but other countries also put retaliatory tariffs on imports from the U.S.

Nearly 80% of Deere’s domestic equipment is assembled in the U.S., with the remaining products imported primarily from Europe, Mexico, India and Japan. During fiscal year 2025, incremental import tariffs adversely affected the cost of Deere products and components and may continue to do so in 2026, the report stated. In addition, retaliatory tariffs by regions outside the U.S., currently in effect or adopted in the future, may impact the prices of Deere’s exported products and profits realized from these exports. 

Deere reported that it’s keeping a close eye on the U.S. Supreme Court case challenging the tariffs. On Nov. 5, the Supreme Court heard oral arguments on tariffs imposed under the International Emergency Economic Powers Act and could provide tariff relief to affected U.S. companies.

“We are monitoring developments in this case and its impact on our future financial statements and business,” the report stated. 

Additionally, the tariffs could change Deere’s ability to manufacture equipment in other countries, restrict access to global markets, negatively affect new relationships in countries seeking to modernize agricultural equipment and practices and have the potential to affect commodity prices globally. 

2026 outlook

While Deere reported it expects a sales decrease of 15%-20% in large agricultural equipment in the U.S. and Canada in 2026, it expects small agricultural and turf sales to be flat to up 5%.

Its construction and forestry division is a bright spot, with a flat to 5% increase in sales in the U.S. and Canada for large and compact construction equipment. Deere has had some growth in South American countries, but performance in countries like Brazil and Argentina is expected to be tempered by high interest rates, low commodity prices and trade uncertainty.