Have you evaluated the performance of Deere's (DE) international operations for the quarter ending July 2025? Given the extensive global presence of this agricultural equipment manufacturer, analyzing the patterns in international revenues is crucial for understanding its financial strength and potential for growth.
In the current global economy, which is more interconnected than ever, a company's success in penetrating international markets is crucial for its financial health and growth journey. Investors must understand a company's dependence on overseas markets, as this offers a window into the company's earnings stability, its ability to benefit from varied economic cycles and its potential for long-term growth.
Being present in international markets serves as a counterbalance to domestic economic challenges while offering chances to engage with more rapidly evolving economies. However, this kind of diversification introduces challenges like currency fluctuations, geopolitical uncertainties and varying market trends.
Upon examining DE's recent quarterly performance, we noticed several interesting patterns in the revenue generated from its international segments, which are commonly analyzed and observed by Wall Street experts.
For the quarter, the company's total revenue amounted to $10.36 billion, experiencing a decline of 9.1% year over year. Next, we'll explore the breakdown of DE's international revenue to understand the importance of its overseas business operations.
Unveiling Trends in DE's International Revenues
During the quarter, Asia, Africa, Australia, New Zealand, and Middle East contributed $1.09 billion in revenue, making up 10.5% of the total revenue. When compared to the consensus estimate of $977.2 million, this meant a surprise of +11.65%. Looking back, Asia, Africa, Australia, New Zealand, and Middle East contributed $1.03 billion, or 9.2%, in the previous quarter, and $1.06 billion, or 9.3%, in the same quarter of the previous year.
Canada accounted for 8.6% of the company's total revenue during the quarter, translating to $895 million. Revenues from this region represented a surprise of -12.45%, with Wall Street analysts collectively expecting $1.02 billion. When compared to the preceding quarter and the same quarter in the previous year, Canada contributed $1.19 billion (10.6%) and $1.07 billion (9.4%) to the total revenue, respectively.
Central Europe and CIS generated $536 million in revenues for the company in the last quarter, constituting 5.2% of the total. This represented a surprise of +45.29% compared to the $368.92 million projected by Wall Street analysts. Comparatively, in the previous quarter, Central Europe and CIS accounted for $428 million (3.8%), and in the year-ago quarter, it contributed $389 million (3.4%) to the total revenue.
Of the total revenue, $1.46 billion came from Latin America during the last fiscal quarter, accounting for 14.1%. This represented a surprise of +12.35% as analysts had expected the region to contribute $1.3 billion to the total revenue. In comparison, the region contributed $1.37 billion, or 12.3%, and $1.37 billion, or 12%, to total revenue in the previous and year-ago quarters, respectively.
Of the total revenue, $2.03 billion came from Western Europe during the last fiscal quarter, accounting for 19.6%. This represented a surprise of +33.18% as analysts had expected the region to contribute $1.52 billion to the total revenue. In comparison, the region contributed $1.82 billion, or 16.3%, and $1.56 billion, or 13.7%, to total revenue in the previous and year-ago quarters, respectively.
Revenue Forecasts for the International Markets
Wall Street analysts expect Deere to report a total revenue of $9.96 billion in the current fiscal quarter, which suggests an increase of 7.4% from the prior-year quarter. Revenue shares from Asia, Africa, Australia, New Zealand, and Middle East, Canada, Central Europe and CIS, Latin America and Western Europe are predicted to be 9.9%, 8.4%, 3%, 14.8%, and 14.5%, corresponding to amounts of $986.51 million, $832.38 million, $296.22 million, $1.47 billion, and $1.45 billion, respectively.
For the entire year, the company's total revenue is forecasted to be $38.25 billion, which is a reduction of 14.6% from the previous year. The revenue contributions from different regions are expected as follows: Asia, Africa, Australia, New Zealand, and Middle East will contribute 9.9% ($3.78 billion), Canada 9.8% ($3.76 billion)Central Europe and CIS 3.3% ($1.27 billion)Latin America 13.7% ($5.24 billion) and Western Europe 15.2% ($5.81 billion) to the total revenue.
Concluding Remarks
Relying on global markets for revenues presents both prospects and challenges for Deere. Therefore, scrutinizing its international revenue trends is key to effectively forecasting the company's future outlook.
In a world where international interdependencies and geopolitical conflicts are ever-increasing, Wall Street analysts closely monitor these trends for companies having international presence to adjust their earnings forecasts. Of course, there are several other factors, including a company's standing within its home borders, that influence analysts' earnings forecasts.
We at Zacks strongly focus on the dynamic earnings forecast of companies, given that empirical studies have demonstrated its potent impact on the immediate price movement of stocks. Invariably, there's a positive relationship -- upward earnings predictions often result in an increase in stock prices.
The Zacks Rank, our proprietary stock rating mechanism, demonstrates a notable performance history confirmed through external audits. It effectively utilizes the power of earnings estimate revisions to act as a predictor of a stock's price performance in the near term.
At the moment, Deere has a Zacks Rank #4 (Sell), signifying that it may underperform the overall market trend in the upcoming period. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>> .
Assessing Deere's Stock Price Movement in Recent Times
Over the past month, the stock has seen a decline of 6.3% in its value, whereas the Zacks S&P 500 composite has posted an increase of 1.9%. The Zacks Industrial Products sector, Deere's industry group, has descended 1% over the identical span. In the past three months, there's been a decline of 3.8% in the company's stock price, against a rise of 10.8% in the S&P 500 index. The broader sector has increased by 9.9% during this interval.
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Deere & Company (DE): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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