John Deere reported third quarter earnings results on Friday morning, crushing expectations on earnings, but cutting its outlook for equipment sales.
The maker of huge machinery used in agriculture and construction reported adjusted earnings per share of $US1.53, and revenues of $US512 million.
The consensus estimate among analysts was adjusted earnings per share of $US1.44 on revenues of $US7.17 billion.
The company estimates that equipment sales will drop about 24% in the fourth quarter. For the year, it estimates a decline of 21%.
“John Deere’s third-quarter results reflected the continuing impact of the downturn in the farm economy as well as lower demand for construction equipment,” said CEO Samuel Allen.
Deere and other agricultural companies have had to deal with grain prices that have tumbled as a result of bountiful harvests. Last week, corn, wheat, and soybean futures fell sharply after the US Department of Agriculture raised its forecasts for production this year.
In the second quarter, the company’s profits fell 30% year-on-year, even though the top and bottom lines surpassed analysts’ forecasts.
The stock is up 2% for the year, and 7% over the past 12 months.