John Deere(DE) - 2025 Q1 - Quarterly Report

Financial Performance - Net sales and revenues for the first quarter of 2025 decreased to $8,508 million, down 30% from$ 12,185 million in the same period of 2024[106] - Net income attributable to Deere & Company for the first quarter of 2025 was $869 million, a decline of 50% compared to$ 1,751 million in the first quarter of 2024[106] - The diluted earnings per share (EPS) for the first quarter of 2025 was $3.19, down from$ 6.23 in the first quarter of 2024, representing a 49% decrease[106] - Total consolidated net income attributable to Deere & Company was $639 million in Q1 2025, down from$ 1.544 billion in Q1 2024, representing a decrease of about 58.7%[143] Segment Performance - Production and Precision Agriculture segment net sales fell by 37% to $3,067 million, with operating profit down 68% to$ 338 million[108] - Small Agriculture and Turf segment net sales decreased by 28% to $1,748 million, with operating profit down 62% to$ 124 million[111] - Construction and Forestry segment net sales dropped by 38% to $1,994 million, with operating profit declining by 89% to$ 65 million[113] - Net sales for the Equipment segment decreased to $6.809 billion in Q1 2025 from$ 10.486 billion in Q1 2024, a decline of approximately 35.5%[143] Cash Flow and Liquidity - Cash, cash equivalents, and marketable securities decreased to $7,815 million as of January 26, 2025, from$ 8,478 million on October 27, 2024[120] - Net cash used for operating activities was $(1,132) million for the three months ended January 26, 2025, compared to$ (908) million for the same period in 2024[122] - Cash returned to shareholders was $844 million in the first three months of 2025[125] - Total cash, cash equivalents, and restricted cash at the end of the period rose to$ 6,907 million in 2025, up from $5,300 million in 2024, representing an increase of approximately 30%[148] Debt and Equity - The ratio of interest-bearing debt to stockholder's equity improved to 7.6 to 1 as of January 26, 2025, from 8.1 to 1 on October 27, 2024[120] - Total external borrowings decreased by$ 812 million in the first three months of 2025[131] Market Outlook - The company expects sales volumes to decline in 2025 due to reduced demand, influenced by high interest rates and market uncertainty[94] - The agricultural market is projected to face lower sales volumes and higher sales incentives in 2025 due to unfavorable market conditions[98] Inventory and Receivables - Trade accounts and notes receivable decreased by $395 million during the first three months of 2025, and decreased by$ 2,864 million compared to a year ago, attributed to lower sales[126] - Inventories increased by $651 million during the first three months of 2025, but decreased by$ 1,193 million compared to a year ago due to lower forecasted demand[128] - Receivables related to sales increased by $1,063 million in 2025, compared to a decrease of$ (277) million in 2024, indicating a shift in sales dynamics[148] Expenses and Costs - The cost of sales to net sales ratio increased to 74.0% in the first quarter of 2025, compared to 68.7% in the first quarter of 2024[107] - Interest expense for the Equipment segment decreased to $84 million in Q1 2025 from$ 108 million in Q1 2024, a decline of about 22.2%[143] - The Equipment operations reported a cost of sales of $5.045 billion in Q1 2025, down from$ 7.207 billion in Q1 2024, a decrease of approximately 30.0%[143] Capital Expenditures and Investments - Capital expenditures in 2025 are estimated to be approximately $1,600 million[129] - Research and development expenses remained relatively stable at$ 526 million in Q1 2025 compared to $533 million in Q1 2024[143] Asset and Liability Management - Total assets decreased to$ 103.119 billion as of January 26, 2025, from $107.320 billion as of October 27, 2024, a reduction of approximately 3.7%[146] - Total liabilities decreased to$ 80.555 billion as of January 26, 2025, from $84.395 billion as of October 27, 2024, a decline of about 4.4%[147] Other Financial Metrics - The company reported a provision for income taxes of$ 27 million in Q1 2025, compared to a provision of $469 million in Q1 2024[143] - The provision for depreciation and amortization increased to$ 549 million in 2025 from $520 million in 2024, indicating ongoing investment in asset maintenance[148] - The company reported a decrease in retirement benefits cash flow impact to$ (688) million in 2025 from $(129) million in 2024, highlighting changes in employee benefit obligations[148]