Bloomberg Intelligence Deere Plunges as Struggling Farmers Delay Machinery Rebound
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Aug 14, 2025 Deere's stock has taken a significant hit as farmers grapple with low crop prices, impacting machinery purchases. Cisco Systems is projecting cautious revenue growth amidst AI uncertainties. The legal landscape is heating up with potential lawsuits over tech export agreements. Meanwhile, U.S. banks are pulling employees back to offices faster than their European counterparts, reflecting differing workplace strategies in the finance sector. This contrast highlights ongoing debates around flexibility and efficiency in banking.
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Deere's Recovery Will Be Slow
- Deere's results were a low-quality beat and management cut 2025 guidance mainly due to construction weakness and tariffs.
- Farm fundamentals remain weak with no clear inflection, so recovery will be gradual into 2026.
Weak Crop Prices Cap Equipment Demand
- Crop prices and farm cash receipts are under pressure from record production and large stockpiles.
- Expect a modest, subdued demand recovery: flat to up ~5% for large ag in North America next year.
Manage Inventories Proactively
- Deere has intentionally underproduced to reduce elevated new-equipment inventories.
- Use merchandising programs and financing pools to move used tractors and avoid deep discounting.