Deere beats across the board and raises its profit forecast

Deere & Company reported second-quarter earning that were ahead of Wall Street expectations while raising its profit forecast.

The farming-equipment maker reported earnings $US2.49 a share, easily beating the $US1.68 that was expected by the Bloomberg consensus. Revenue came in at $US8.29 billion, topping the $US7.27 that analysts were anticipating.

“John Deere reported strong results in the second quarter as market conditions showed signs of further stabilisation,” Chairman and CEO Samuel R. Allen said in the earnings release. “We are seeing modestly higher overall demand for our products, with farm machinery sales in South America experiencing a strong recovery.

In addition to beating on both the top and bottom lines, Deere raised its 2017 profit forecast. The company now expects sales to rise 9% through October, up from its earlier estimate of about a 4% increase. Deere sees net income of about $US2 billion, up from its previous estimate of around $US1.5 billion.

The strong results are further evidence Deere is seeing further stabilisation in the industry. The company has been sounding the alarm on a “global farming recession” which has weighed on results over the past several quarters.

In last quarter’s release, Allen noted that the worst of that recession may be over.

NOW WATCH: China built a $US350 million bridge that ends in a dirt field in North Korea

NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at