Deere & Co. said its profit more than doubled in the most recently completed quarter as higher prices and strong demand for farm and construction equipment lifted sales by nearly a third.
The world’s largest seller of tractors and crop harvesters is now expecting higher earnings for the year after reporting a profit of $1.96 billion for the quarter ended Jan. 29, up from $903 million in the same quarter a year ago. Quarterly earnings rose to $6.55 a share, topping analyst expectations by nearly a dollar a share, according to FactSet.
Chief Executive John C. May said Deere benefited from favorable market conditions and higher levels of production. Each of Deere’s three main operating segments logged higher shipment volumes on raised prices. Revenue soared 32% to $12.65 billion, clearing analyst expectations by more than a billion dollars.
The company, based in Moline, Ill., is still dealing with elevated production costs and overhead expenses, along with unfavorable foreign-currency fluctuations and bonus-related costs tied to the contract it reached with the United Auto Workers union in 2021.
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But Deere has been blunting those rising costs with higher prices that farmers continue to shell out for, even as prices for seed, fertilizer and other farming commodities remain elevated.
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Deere said Friday that it now expects to turn a profit of between $8.75 billion and $9.25 billion for fiscal 2023, a $750 million jump from the midpoint of guidance it gave in the fall.
Shares advanced 5.9% to $426.66 in midmorning trading.