What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2026-02-26 compared with 2025-08-28 · 141 added, 229 removed, 264 unchanged (58% of the section changed)

1 unchanged sentence

RESULTS OF OPERATIONS

All amounts are presented in millions of dollars unless otherwise specified.

All amounts are presented in millions of U.S.

dollars unless otherwise specified.

Deere & Company is a global leader in the production of agricultural, turf, construction, and forestry equipment and solutions.

John Deere Financial provides financing for John Deere equipment, parts, services, and other input costs customers need to run their operations.

Our operations are managed through the production and precision agriculture (PPA), small agriculture and turf (SAT), construction and forestry (CF), and financial services operating segments.

John Deere Financial provides financing for John Deere equipment, parts, services, and other inputs customers need to run their operations.

Our operations are managed through the Production & Precision Agriculture (PPA), Small Agriculture & Turf (SAT), Construction & Forestry (CF), and Financial Services operating segments.

References to “equipment operations” include PPA, SAT, and CF, while references to “agriculture and turf” include both PPA and SAT.

4 unchanged sentences

Company Trends

Customers seek to improve profitability, productivity, and sustainability through integrating technology into their operations.

Deeper integration of technology into equipment is a persistent market trend.

These technologies are incorporated into products within each of our operating segments.

We expect this trend to persist for the foreseeable future.

Our Smart Industrial Operating Model and Leap Ambitions are intended to capitalize on this market trend.

Engaged acres are an indicator we use to understand customer utilization of our technology.

We remain focused on a Solutions as a Service business model to increase technology adoption and utilization by our customers.

Solutions as a Service products did not represent a significant percentage of our revenues in the periods presented.

Our Leap Ambitions, a set of focused goals designed to guide the implementation of our Smart Industrial Operating Model, feature multi-year financial and operational goals, emphasizing the use of our differentiated equipment and service solutions, including automation, autonomy, digitalization, lifecycle solutions, and Solutions as a Service (SaaS).

Deeper integration of technology into equipment to enable customers to do more with less remains a persistent market trend.

Customers seek to improve profitability, productivity, and sustainability by selecting our equipment and technology solutions.

These technologies are incorporated into customer operations across the varied production systems in which we serve.

While we continue to benefit from the adoption of these technologies, revenue from SaaS products did not represent a significant percentage of our revenues in the periods presented.

Company Outlook for 2026

Agriculture and turf and construction equipment sales volumes for fiscal 2025 are expected to be lower than the prior year due to reduced demand.

Agriculture and Turf Outlook for 2025

● Demand for large agricultural equipment in the U.S.

and Canada is expected to decline due to high interest rates, elevated used inventory levels in late model-year machines, trade uncertainty, and the persistence of lower commodity prices.

Constrained global grain and oilseed stocks, stable customer balance sheets supported by strong farm land values, the impact of U.S.

government subsidies on farm incomes, and projected strong crop yields are expected to partially mitigate this decline.

● We expect small agricultural equipment sales to be down from 2024 levels in the U.S.

Solid profitability is anticipated to continue in the small agricultural sector as dairy and livestock prices remain elevated;

however, this is projected to be more than offset by restrained demand in the turf and compact utility tractor markets amid economic uncertainty and elevated interest rates.

● Industry demand in Europe is forecasted to be flat to down slightly.

Farm fundamentals are improving, supported by strong dairy margins, coupled with an improving interest rate environment.

● Demand in South America is expected to be roughly flat.

In Brazil, record crop yields, improved corn and soybean profitability, and continued expansion of crop production acreage are expected to have a positive impact

However, high interest rates and greater trade policy uncertainty with the U.S.

continue to temper demand for equipment.

● Industry sales in Asia are forecasted to be flat to up slightly as the outlook for tractor sales in India improves.

Construction and Forestry Outlook for 2025

● Construction industry sales for earthmoving equipment are forecasted to be down and compact construction equipment sales are expected to be flat to down in the U.S.

and Canada from 2024 levels.

The decline is due to trade uncertainty and higher interest rates.

Projections for single-family housing starts are slowing, while rental sales along with multi-family and commercial real estate markets continue to soften.

These unfavorable factors are projected to be partially offset by high levels of U.S.

government infrastructure spending.

● Global forestry markets are expected to be flat to down as global market conditions remain challenged.

● Global roadbuilding markets are forecasted to be generally flat, supported by growth in Europe and a slight recovery in China, offset by slightly lower demand in North America compared to 2024.

Large agriculture sales in North America are expected to remain subdued and soften in South America resulting in decreased sales volume for PPA in 2026 compared to 2025.

SAT and CF sales are expected to improve in 2026.

Our net sales are expected to increase in 2026 compared to 2025 with the anticipated decline in PPA sales, more than offset by improvements in CF and SAT.

Agriculture and Turf Industry Outlook for 2026

● Demand in the U.S.

and Canada for large agriculture equipment is expected to decrease compared to 2025 levels amid challenging farm fundamentals for row crop farmers.

These factors are expected to be partially offset by strong crop production, robust demand for commodities, and normalizing global crop trade flows.

In addition, government programs continue to support farmers’ short-term liquidity.

Ongoing improvements in the used inventory market and the increase in age of used equipment are providing a better environment for machine replacement demand.

● We expect small agricultural and turf equipment sales to be flat to up slightly from 2025 levels in the U.S.

The dairy and livestock market continues to generate profits driven by strong beef prices.

A modest recovery is anticipated in the turf sector following several years of contraction.

● In Europe, the industry is forecasted to be flat to up slightly despite recent declines in milk prices, supported by a steady interest rate environment, manageable long-term financing costs, and resilient crop yields.

● Demand in South America is expected to be down slightly driven by the Brazilian market where subdued commodity prices, high interest rates, and a stronger Brazilian real are putting pressure on farmer margins.

● Industry sales in Asia are forecasted to be flat to down slightly.

Construction and Forestry Industry Outlook for 2026

● Industry sales in the U.S.

and Canada for earthmoving and compact construction equipment are projected to be slightly higher compared to 2025.

government infrastructure spending, declining interest rates, strong rental equipment demand, and data center construction activity continue to provide a solid foundation for the industry.

● Global forestry markets are expected to be flat.

● Global roadbuilding markets are forecasted to be up slightly compared to 2025 driven by market growth in North America and Europe.

Financial Services Outlook for 2026

+ Prior and current period special items

+ Selling, administrative and general expenses

(-) Average portfolio

(-) Prior period special items

+ Provision for credit losses

+ Financing spreads

2 unchanged sentences

The agricultural market is affected by various factors including commodity prices, acreage planted, crop yields, government policies, and uncertainty in macroeconomic trends.

These factors affect farmers’ income and sentiment which may result in lower demand for equipment.

In 2025, we expect to continue experiencing the following effects due to unfavorable market conditions:

lower sales volumes, higher sales incentives, and elevated receivable write-offs and expected credit losses.

These factors affect farmers’ income and sentiment which may result in varying demand for our equipment.

In 2026, we may experience the following effects due to unfavorable market conditions:

lower sales volumes, higher sales incentives, and elevated receivable write-offs.

Global Trade Policies.

During 2025, new tariffs were imposed in the U.S.

for imports from a broad range of countries and materials.

Certain countries also implemented or proposed retaliatory tariffs on imports from the U.S.

and barriers to trade.

Trade policies are rapidly evolving causing uncertainty in the agriculture and construction industries.

In 2025, new tariffs were imposed in the U.S.

for imports from a broad range of countries and on certain materials.

Several countries also implemented retaliatory tariffs on imports from the U.S.

and introduced additional trade barriers.

Trade policies impact us in various ways.

1 unchanged sentence

Nearly 75% of our domestic sales are assembled in the U.S., with the remaining products imported primarily from Europe, Mexico, India, and Japan.

During 2025, incremental import tariffs have adversely affected the cost of our products and components and may continue to do so.

In addition, retaliatory tariffs by regions outside the U.S., currently in effect or adopted in the future, may impact the prices of our exported products and the profit realized from these exports.

The direct impact of incremental tariffs incurred by us in the first nine months of 2025 was approximately $300, excluding the impact of tariffs on our suppliers and market demand.

On August 18, 2025, the scope of steel and aluminum derivative duties was expanded to include additional Harmonized Tariff Schedule codes.

The updated tariff coverage is expected to further increase the cost of our products and components.

We are actively taking steps to mitigate, to the extent possible, potential impacts on our business.

Interest Rates.

Interest rates in the U.S.

and Brazil have remained elevated in 2025.

Higher rates and volatility in rates impact us in several ways, primarily affecting the demand for our products and financing spreads for the financial services operations.

The markets for our agriculture, turf, and construction products are negatively impacted by elevated interest rates and their effect on borrowing costs for our customers.

Changes in the agricultural market business cycle, global trade policies, and interest rates are driven by factors outside of our control, and as a result we cannot reasonably foresee when these conditions will fully subside.

Tax Legislation – In July, the U.S.

government enacted new tax legislation as part of the One Big Beautiful Bill Act of 2025.

The legislation has multiple effective dates, beginning in 2025 and continuing through 2027.

It did not have a material impact on our financial statements and is not expected to affect the current fiscal year materially.

Incremental import tariffs adversely affected the cost of our products and components beginning in the third quarter of 2025 and are expected to continue to do so in 2026.

The direct impact of incremental tariffs incurred by us was $361 in the first quarter of 2026, excluding the impact of tariffs on our suppliers and market demand.

Trade policies are evolving, causing uncertainty in the agriculture and construction industries.

We are actively taking steps to mitigate potential impacts on our business, to the extent possible.

On February 20, 2026, the United States Supreme Court issued a decision invalidating tariffs imposed under the International Emergency Economic Powers Act (IEEPA).

This decision may provide tariff relief and the potential recovery of amounts previously paid.

We are currently evaluating the impact of this decision on our future financial statements.

Changes in the agricultural market business cycle and global trade policies are driven by factors outside of our control, and as a result, we cannot reasonably foresee when these conditions may subside.

Legal Proceeding – On January 15, 2025, the Federal Trade Commission (FTC), along with the Attorneys General of the States of Illinois and Minnesota filed a lawsuit against us in the United States District Court for the Northern District of Illinois Western Division.

2 unchanged sentences

Plaintiffs seek a permanent injunction and other equitable relief to allow owners of our equipment, as well as independent repair providers, access to our repair tools and any other repair resources available to authorized John Deere dealers.

We are in preliminary discussions with the FTC with respect to a potential resolution.

At this stage, we are unable to estimate the potential impact on our business.

Other Items of Concern and Uncertainties – Other items that could impact our results are:

● global and regional political conditions, including the ongoing war between Russia and Ukraine and the conflicts in the Middle East

● shifts in energy, economic, tax and trade policies, and positions on government subsidies of farming

● global and regional political conditions

● shifts in energy, including positions with respect to biofuels, economic, and positions on government subsidies of farming

● capital market disruptions

2 unchanged sentences

● weather conditions

● marketplace adoption and monetization of technologies we have invested in

● our ability to strengthen our digital capabilities, automation, autonomy, and alternative power technologies

● marketplace pace of adoption and monetization of technologies we have invested in

● our ability to strengthen our digital capabilities, artificial intelligence, automation, and autonomy

● changes in demand and pricing for new and used equipment

5 unchanged sentences

Three Months Ended

Nine Months Ended

Deere & Company

3 unchanged sentences

Diluted earnings per share

Net sales and revenues decreased for both the quarter and year-to-date periods primarily due to lower sales volumes.

Net income and diluted EPS decreased in the third quarter primarily due to lower sales volumes, higher tariffs, and unfavorable price realization.

Results for the first nine months were also affected by lower production costs, driven by reduced material costs, and favorable discrete tax items (see Note 21).

The discussion of net sales and operating profit is included in the Business Segment Results below.

An explanation of the cost of sales to net sales ratio and other significant statements of consolidated income changes follows:

Net sales and revenues increased 13% for the quarter, primarily due to higher sales volumes of $988 and the positive effects of foreign currency translation of $227.

Net income decreased $213, primarily due to incremental tariffs of $272 ($361 pretax) and prior period favorable discrete tax items of $163 described in Note 21, partially offset by the impact of higher shipment volumes of $188 ($249 pretax).

The discussion of segment net sales and operating profit is included in the Business Segment Results below.

An explanation of the cost of sales to net sales ratio and other significant statement of consolidated income changes follows:

Three Months Ended

Nine Months Ended

Deere & Company

Cost of sales to net sales

(–) Lower volumes

+ Material costs

Increased due to higher tariffs and higher overhead costs from production inefficiencies associated with lower volumes, partially offset by reduced material costs and lower employee profit-sharing incentives.

Lower for both periods primarily due to a decrease in revenues from certain licenses and credit enhancement recoveries in the prior period.

Additionally, the first nine months were impacted by reduced investment income.

(+) Production efficiencies

Increased mostly due to incremental tariffs, partially offset by production efficiencies resulting from increased manufacturing volumes.

Higher due to increased income earned from extended warranty premiums and higher service revenues.

Research and development expenses

Largely unchanged due to continued focus on developing and incorporating technology solutions.

Selling, administrative and general expenses

Decreased for both periods due to lower employee profit-sharing incentives and the favorable impact from Banco John Deere S.A.

(BJD) deconsolidation (see Note 21).

Additionally, the quarter had lower provision for credit losses.

Increased due to continued focus on developing and deploying technology solutions.

Interest expense

Decreased for both periods primarily due to lower average borrowings and lower average borrowing rates.

Other operating expenses

Increased for the three months ended due to higher depreciation of equipment on operating leases.

Decreased for the first nine months due to lower foreign currency exchange losses and higher pension benefits (see Note 6).

Decreased due to lower average borrowing rates and lower average borrowings.

Provision for income taxes

Decreased for both periods as a result of lower pretax income.

Additionally, the nine months ended was impacted by the favorable impact of discrete tax adjustments (see Note 21).

Increased due to favorable discrete tax adjustments recognized in the prior period (see Note 21).

Business Segment Results – 2026 compared with 2025

The equipment operations segment results were impacted by incremental tariffs in 2026.

The cost of additional tariffs was included in the “Production costs” and “Other” categories below.

The change in tariff costs was included in the “Production Costs” category below.

Three Months Ended

Nine Months Ended

Production and Precision Agriculture

Production & Precision Agriculture

Operating profit

2 unchanged sentences

Currency translation impact on Net sales

Production and precision agriculture sales decreased for the quarter as a result of lower U.S.

shipment volumes driven mainly by higher interest rates, global uncertainty, and used inventory levels.

Increased shipment volumes in Brazil and Europe partially offset this decrease.

Price realization was unfavorable for the quarter due to incremental incentive programs deployed to address used inventory levels in North America.

Operating profit decreased primarily due to lower shipment volumes / sales mix.

Production & Precision Agriculture Operating Profit

Third Quarter 2025 Compared to Third Quarter 2024

Sales for the first nine months decreased as a result of lower shipment volumes (primarily in the U.S.

and Europe) driven by higher interest rates and used inventory levels.

Operating profit for the first nine months decreased due to lower shipment volumes / sales mix.

Production & Precision Agriculture sales increased for the quarter as a result of the positive effects of foreign currency translation (primarily the Euro and Brazilian real).

Operating profit decreased primarily due to higher tariffs, unfavorable sales mix, and higher warranty expenses.

Production & Precision Agriculture Operating Profit

First Nine Months 2025 Compared to First Nine Months 2024

First Quarter 2026 Compared to First Quarter 2025

Three Months Ended

Nine Months Ended

Small Agriculture and Turf

Small Agriculture & Turf

Operating profit

2 unchanged sentences

Currency translation impact on Net sales

Small agriculture and turf sales decreased for the quarter as a result of lower shipment volumes (primarily in the U.S., offset by Europe and India) driven mainly by economic uncertainties and higher interest rates, partially offset by favorable currency translation and price realization in the U.S.

Operating profit decreased due to higher tariffs, partially offset by favorable factors including reductions in warranty expenses and lower production costs from lower material costs.

Small Agriculture & Turf Operating Profit

Third Quarter 2025 Compared to Third Quarter 2024

Sales for the first nine months decreased as a result of lower shipment volumes (primarily in the U.S.) driven mainly by economic uncertainties and higher interest rates.

Operating profit for the first nine months decreased primarily as a result of lower shipment volumes / sales mix, partially offset by decreased production costs driven by lower material costs and price realization.

Small Agriculture & Turf sales increased for the quarter due to higher shipment volumes (primarily in the U.S., Canada, Europe, and India) driven by increased customer demand.

Sales also increased as a result of the positive impact of the Euro foreign currency translation.

Operating profit increased primarily as a result of higher shipment volumes and price realization, partially offset by higher tariffs.

Small Agriculture & Turf Operating Profit

First Nine Months 2025 Compared to First Nine Months 2024

First Quarter 2026 Compared to First Quarter 2025

Three Months Ended

Nine Months Ended

Construction and Forestry

Construction & Forestry

Operating profit

2 unchanged sentences

Currency translation impact on Net sales

Construction and forestry sales decreased for the quarter due to unfavorable price realization in the U.S.

due to incremental incentive programs deployed to address pressures from the competitive environment.

Operating profit decreased primarily due to unfavorable price realization and higher tariffs.

These factors were partially offset by favorable product mix.

Construction & Forestry Operating Profit

Third Quarter 2025 Compared to Third Quarter 2024

Sales for the first nine months decreased due to lower shipment volumes (primarily in the U.S.) and unfavorable price realization in the U.S.

due to pressures from the competitive environment.

Operating profit decreased primarily due to lower shipment volumes / sales mix and unfavorable price realization.

Construction & Forestry sales increased for the quarter due to higher U.S.

shipment volumes, driven by increased customer demand from a strong construction market.

Additionally, sales increased as a result of the positive impacts of the Euro foreign currency translation.

Operating profit increased primarily due to higher shipment volumes and production efficiencies, partially offset by higher tariffs.

Construction & Forestry Operating Profit

First Nine Months 2025 Compared to First Nine Months 2024

First Quarter 2026 Compared to First Quarter 2025

Three Months Ended

Nine Months Ended

Financial Services

1 unchanged sentence

Interest expense

The average balance of receivables and leases financed was 6% lower in the third quarter of 2025 and 5% lower in the first nine months of 2025 compared with the same periods last year, primarily due to the deconsolidation of BJD.

Revenue decreased for both periods as a result of a lower average portfolio.

Financial services net income for the quarter was higher due to a lower provision for credit losses and prior year special items (see Note 21).

Net income for the nine month period was higher due to benefits from special items (see Note 21) and lower selling, administrative, and general expenses, partially offset by lower financing spreads and a higher provision for credit losses.

Revenue decreased primarily due to the deconsolidation of Banco John Deere S.A.

(BJD) in the second quarter of 2025 and a 2% lower average balance of receivables and leases portfolio compared to the same period last year.

Interest expense decreased as a result of lower average borrowing rates and lower average borrowings.

Net income for the quarter increased primarily due to favorable financing spreads and a lower provision for credit losses, partially offset by the prior period decreased valuation allowance on BJD “Assets held for sale” (see Note 21).

Critical Accounting Estimates

11 unchanged sentences

Based on the available sources of liquidity, we expect to meet our funding needs in the short term (next 12 months) and long term (beyond 12 months).

We are forecasting lower operating cash flows from equipment operations in 2025 compared with 2024 driven by a decrease in net income adjusted for non-cash provisions.

We are forecasting operating cash flows from equipment operations in 2026 to remain flat compared with 2025 driven by an offsetting decrease in net income adjusted for non-cash provisions, and higher cash flows generated from inventory reductions.

We operate in multiple industries, which have unique funding requirements.

1 unchanged sentence

Historically, these operations have been subject to seasonal variations in financing requirements for inventories and receivables from dealers.

The financial services operations rely on their ability to raise substantial amounts of funds to finance their receivable and lease portfolio.

In the second quarter of 2025, the BJD business was deconsolidated (see Note 20).

BJD assets and liabilities were reclassified to held for sale in the third quarter of 2024 and maintained that classification until the deconsolidation;

they are not included within balances of any of the periods presented.

The financial services operations rely on their ability to raise substantial amounts of funds to finance their receivable and lease portfolios.

Key metrics are provided in the following table:

6 unchanged sentences

Ratio of interest-bearing debt to stockholder’s equity

The decrease in unused credit lines during the first nine months of 2025 relates to an increase in commercial paper outstanding, partially offset by an increase in bank lines of credit.

The increase in unused credit lines compared to a year ago was due to an increase in bank lines of credit and a small decrease in commercial paper outstanding.

There have been no material changes to the contractual obligations and other cash requirements identified in our most recently filed Annual Report on Form 10-K.

Nine Months Ended

July 27, 2025

July 28, 2024

Net cash provided by operating activities

Net cash used for investing activities

Three Months Ended

Net cash used for operating activities

Net cash provided by investing activities

Net cash used for financing activities

Effect of exchange rate changes on cash, cash equivalents, and restricted cash

Net increase (decrease) in cash, cash equivalents, and restricted cash

Cash inflows from consolidated operating activities in the first nine months of 2025 were $3,464.

This resulted mainly from net income adjusted for non-cash provisions, partially offset by an OPEB contribution, a decrease in accrued employee profit-sharing incentives, an increase in inventories, and an increase in receivables related to sales.

Cash outflows from investing activities were $801 in the first nine months of this year.

The primary drivers were purchases of property and equipment and growth in equipment on operating leases, partially offset by collections of receivables (excluding receivables related to sales) exceeding the cost of receivables acquired.

Cash outflows from financing activities were $1,557 in the first nine months of 2025, as cash returned to shareholders was partially offset by higher external borrowings.

Cash returned to shareholders was $2,418 in the first nine months of 2025.

Cash, cash equivalents, and restricted cash increased $1,214 during the first nine months of 2025.

Net decrease in cash, cash equivalents, and restricted cash

Cash outflows from consolidated operating activities in the first three months of 2026 were $890.

This resulted mainly from the payout of employee profit-sharing incentives, an increase in inventories, and a reduction in dealer sales incentive accruals, partially offset by net income adjusted for non-cash provisions.

Cash inflows from investing activities were $1,822 in the first three months of this year.

The primary drivers were collections of receivables (excluding receivables related to sales) exceeding the cost of receivables acquired, partially offset by purchases of property and equipment.

Cash outflows from financing activities were $2,490 in the first three months of 2026 due to lower borrowings, dividends paid, and repurchases of common stock.

Cash returned to shareholders was $743 in the first three months of 2026.

Cash, cash equivalents, and restricted cash decreased $1,460 during the first three months of this year.

Key Metrics and Balance Sheet Changes

1 unchanged sentence

Trade accounts and notes receivable arise from sales of goods to customers.

Trade receivables increased $777 during the first nine months of 2025, primarily due to a seasonal increase.

These receivables decreased $1,366 compared to a year ago due to lower sales volumes.

The percentage of total worldwide trade receivables outstanding for periods exceeding 12 months was 3% at July 27, 2025, 6% at October 27, 2024, and 3% at July 28, 2024.

Trade receivables increased $676 during the first three months of 2026, and increased $1,062 compared to a year ago, both due to higher sales.

The percentage of total worldwide trade receivables outstanding for periods exceeding 12 months was 2% at February 1, 2026, 3% at November 2, 2025, and 6% at January 26, 2025.

Financing Receivables and Equipment on Operating Leases.

Financing receivables and equipment on operating leases consist of retail notes originated in connection with financing of new and used equipment, operating leases, revolving charge accounts, sales-type and direct financing leases, and wholesale notes.

Financing receivables and equipment on operating leases decreased $1,093 during the first nine months of 2025 and increased $102 in the past 12 months.

The decrease during the first nine months of 2025 was due to lower retail customer receivables.

Total acquisition volumes of financing receivables and equipment on operating leases were 15% lower in the first nine months of 2025, compared with the same period last year excluding BJD receivables, as volumes of wholesale notes, retail notes, financing leases, and operating leases were lower, while revolving charge accounts were slightly higher compared to the same period last year.

Inventories increased by $620 during the first nine months of 2025 primarily due to a seasonal increase, and increased by $17 compared to a year ago.

A majority of these inventories are valued at cost on the “last-in, first-out” (LIFO) method.

Financing receivables and equipment on operating leases decreased $2,902 during the first quarter of 2026, primarily due to seasonal payments and lower retail customer receivables, and decreased $706 in the past 12 months due to lower wholesale notes.

Total acquisition volumes of financing receivables and equipment on operating leases were 12% higher in the first three months of 2026, compared with the same period last year, as volumes of wholesale notes and revolving charge accounts were higher compared to the same period last year.

Inventories increased by $880 during the first three months, primarily due to a seasonal increase.

Inventories increased $542 compared to a year ago due to the effects of foreign currency translation.

A majority of these inventories are valued on the last-in, first-out (LIFO) method.

Property and Equipment .

Property and equipment cash expenditures in the first nine months of 2025 were $852 compared with $1,043 in the same period last year.

Capital expenditures in 2025 are estimated to be approximately $1,450.

Property and equipment cash expenditures in the first three months of 2026 were $256, compared with $352 in the same period last year.

Capital expenditures in 2026 are estimated to be approximately $1.4 billion.

Accounts Payable and Accrued Expenses.

Accounts payable and accrued expenses decreased by $961 in the first nine months of 2025, primarily due to a decrease in accrued expenses associated with employee benefits and dealer sales discounts.

Accounts payable and accrued expenses decreased $815 compared to a year ago due to a decrease in accrued expenses associated with employee benefits, warranty liabilities, and dealer sales discounts.

Total external borrowings increased by $1,453 in the first nine months of 2025 and increased $791 compared to a year ago, which contributed to higher cash and cash equivalents.

Accounts payable and accrued expenses decreased by $1,376 in the first three months of 2026, primarily due to a decrease in accrued expenses associated with employee benefits and dealer sales incentives.

Accounts payable and accrued expenses increased $371 compared to a year ago, due to an increase in accounts payable associated with trade payables, partially offset by a decrease in accrued expenses associated with employee benefits.

Total external borrowings decreased by $1,457 in the first three months of 2026 and decreased $1,902 compared to a year ago, generally corresponding with the level of the receivable and lease portfolio, as well as other working capital requirements.

John Deere Capital Corporation (Capital Corporation), a U.S.

financial services subsidiary, has a revolving warehouse facility to utilize bank conduit facilities to securitize retail notes (see Note 10).

The facility has an expiration in November 2025 and total capacity or “financing limit” of $2,500.

At July 27, 2025, $1,783 of securitization borrowings were outstanding under the facility.

The facility was renewed in November 2025, with an expiration in November 2026, and with a total capacity or “financing limit” of $2,500.

At February 1, 2026, $2,025 of securitization borrowings were outstanding under the facility.

At the end of the contractual revolving period, unless the banks and Capital Corporation agree to renew, Capital Corporation would liquidate the secured borrowings over time as payments on the retail notes are collected.

In the first nine months of 2025, the financial services operations issued $2,618 and retired $3,441 of retail note securitization borrowings, which are presented in “Net proceeds (payments) in short-term borrowings (original maturities three months or less).”

In the first three months of 2026, the financial services operations issued $659 and retired $974 of retail note securitization borrowings, which are presented in “Net proceeds (payments) in total short-term borrowings (original maturities three months or less).”

Lines of Credit.

We have access to bank lines of credit with various banks throughout the world.

Worldwide lines of credit totaled $12.2 billion at July 27, 2025, consisting primarily of:

We also have access to bank lines of credit with various banks throughout the world.

Worldwide lines of credit totaled $12.2 billion at February 1, 2026, consisting primarily of:

● a 364-day credit facility agreement of $5.0 billion expiring in the second quarter of 2026

1 unchanged sentence

● a credit facility agreement of $3.25 billion expiring in the second quarter of 2030

At July 27, 2025, $6,150 of these worldwide lines of credit were unused.

At February 1, 2026, $7.2 billion of these worldwide lines of credit were unused.

For the purpose of computing unused credit lines, commercial paper and short-term bank borrowings were considered to constitute utilization.

18 unchanged sentences

Among these factors are risks related to:

● government policies and actions with respect to the global trade environment including increased and proposed tariffs announced by the U.S.

● the agricultural business cycle, which can be unpredictable and is affected by factors such as farm income, international trade, world grain stocks, crop yields, available farm acres, soil conditions, prices for commodities and livestock, input costs, government farm programs, availability of transport for crops as well as adverse macroeconomic conditions, including unemployment, inflation, interest rate volatility, changes in consumer practices due to slower economic growth or a recession, and regional or global liquidity constraints

● the uncertainty of government policies and actions with respect to the global trade environment including increased and proposed tariffs announced by the U.S.

government and retaliatory trade regulations

● the uncertainty of our ability to sell products domestically or internationally, continue production at certain international facilities, procure raw materials and components, accurately forecast demand and inventory, manage increased costs of production, absorb or pass on increased pricing, accurately predict financial results and industry trends, and remain competitive based on trade actions, policies, and general economic uncertainty;

● the agricultural business cycle, which can be unpredictable and is affected by factors such as world grain stocks, harvest yields, available farm acres, acreage planted, soil conditions, prices for commodities and livestock, input costs, availability of transport for crops as well as adverse macroeconomic conditions, including unemployment, inflation, interest rate volatility, changes in consumer practices due to slower economic growth or a recession, and regional or global liquidity constraints;

● higher interest rates and currency fluctuations which could adversely affect the U.S.

dollar, customer confidence, access to capital, and demand for our products and solutions;

● our ability to adapt in highly competitive markets, including understanding and meeting customers’ changing expectations for products and solutions, including delivery and utilization of precision technology;

● housing starts and supply, real estate and housing prices, levels of public and non-residential construction, and infrastructure investment;

● political, economic, and social instability of the geographies in which we operate, including the ongoing war between Russia and Ukraine and the conflicts in the Middle East;

● political, economic, and social instability in the geographies in which we operate

● worldwide demand for food and different forms of renewable energy impacting the price of farm commodities and consequently the demand for our equipment

● investigations, claims, lawsuits, or other legal proceedings, including the lawsuit filed by the Federal Trade Commission (FTC) and the Attorneys General of the States of Arizona, Illinois, Michigan, Minnesota, and Wisconsin alleging that we unlawfully withheld self-repair capabilities from farmers and independent repair providers;

● delays or disruptions in our supply chain;

● changes in climate patterns, unfavorable weather events, and natural disasters;

● availability and price of raw materials, components, and whole goods;

● suppliers’ and manufacturers’ business practices and compliance with laws applicable to topics such as human rights, safety, environmental, and fair wages;

● loss of or challenges to intellectual property rights;

● rationalization, restructuring, relocation, expansion, and/or reconfiguration of manufacturing and warehouse facilities

● the ability to execute business strategies, including our Smart Industrial Operating Model and Leap Ambitions;

● accurately forecasting customer demand for products and services and adequately managing inventory

● uncertainty of our ability to sell products domestically or internationally, manage increased costs of production, absorb or pass on increased expenses, and accurately predict financial results and industry trends

● availability and price of raw materials, components, and whole goods

● delays or disruptions in our supply chain

● changes in climate patterns, unfavorable weather events, and natural disasters

● suppliers’ and manufacturers’ business practices and compliance with applicable laws such as human rights, safety, environmental, and fair wages

● higher interest rates and currency fluctuations which could adversely affect the U.S.

dollar, customer confidence, access to capital, and demand for our products and solutions

● the ability to attract, develop, engage, and retain qualified employees

● ability to adapt in highly competitive markets, including understanding and meeting customers’ changing expectations for products and solutions, including delivery and utilization of precision technology

● the ability to execute business strategies, including our Smart Industrial Operating Model and refined Leap Ambitions

● dealer practices and their ability to manage new and used inventory, distribute our products, and to provide support and service for precision technology solutions

1 unchanged sentence

● negative claims or publicity that damage our reputation or brand

● the ability to attract, develop, engage, and retain qualified employees;

● the impact of workforce reductions on company culture, employee retention and morale, and institutional knowledge

2 unchanged sentences

● leveraging artificial intelligence and machine learning within our business processes

● changes to governmental communications channels (radio frequency technology);

● changes to existing laws and regulations, including the implementation of new, more stringent laws, as well as compliance with a variety of U.S., foreign, and international laws, regulations, and policies relating to, but not limited to the following:

advertising, anti-bribery and anti-corruption, anti-money laundering, antitrust, consumer finance, cybersecurity, data privacy, encryption, environmental (including climate change and engine emissions), farming, health and safety, foreign exchange controls and cash repatriation restrictions, foreign ownership and investment, human rights, import / export and trade, tariffs, labor and employment, product liability, tax, telematics, and telecommunications;

advertising, anti-bribery and anti-corruption, anti-money laundering, antitrust, consumer finance, cybersecurity, data privacy, encryption, environmental (including climate change and engine emissions), farming, foreign exchange controls and cash repatriation restrictions, foreign ownership and investment, health and safety, human rights, import / export and trade, labor and employment, product liability, tariffs, tax, telematics, and telecommunications

● governmental and other actions designed to address climate change in connection with a transition to a lower-carbon economy

● warranty claims, post-sales repairs or recalls, product liability litigation, and regulatory investigations because of the deficient operation of our products

● loss of or challenges to intellectual property rights

Further information concerning us and our businesses, including factors that could materially affect our financial results, is included in our other filings with the SEC (including, but not limited to, the factors discussed in Item 1A.

4 unchanged sentences

Equipment operations represent the enterprise without Financial Services.

Equipment operations include production and precision agriculture operations, small agriculture and turf operations, construction and forestry operations, and other corporate assets, liabilities, revenues, and expenses not reflected within financial services.

Equipment operations include Production & Precision Agriculture operations, Small Agriculture & Turf operations, Construction & Forestry operations, and other corporate assets, liabilities, revenues, and expenses not reflected within Financial Services.

Transactions between the equipment operations and Financial Services have been eliminated to arrive at the consolidated financial statements.

8 unchanged sentences

STATEMENTS OF INCOME

For the Three Months Ended July 27, 2025 and July 28, 2024

Net Sales and Revenues

Finance and interest income

Costs and Expenses

Cost of sales

Research and development expenses

Selling, administrative and general expenses

Interest expense

Interest compensation to Financial Services

Other operating expenses

Income before Income Taxes

Provision for income taxes

Income after Income Taxes

Equity in income (loss) of unconsolidated affiliates

Net loss attributable to noncontrolling interests

Net Income Attributable to Deere & Company

1 Elimination of intercompany interest income and expense.

2 Elimination of equipment operations’ margin from inventory transferred to equipment on operating leases.

3 Elimination of income and expenses between equipment operations and financial services related to intercompany guarantees of investments in certain international markets.

4 Elimination of intercompany service revenues and fees.

5 Elimination of financial services’ lease depreciation expense related to inventory transferred to equipment on operating leases.

DEERE & COMPANY

SUPPLEMENTAL CONSOLIDATING DATA (Continued)

STATEMENTS OF INCOME

For the Nine Months Ended July 27, 2025 and July 28, 2024

For the Three Months Ended February 1, 2026 and January 26, 2025

Net Sales and Revenues

8 unchanged sentences

Income before Income Taxes

Provision for income taxes

Provision (credit) for income taxes

Income after Income Taxes

10 unchanged sentences

CONDENSED BALANCE SHEETS

Cash and cash equivalents

31 unchanged sentences

7 Primarily reclassification of sales incentive accruals on receivables sold to Financial Services.

8 Reclassification of net pension assets / liabilities.

8 Reclassification of other receivables / payables.

9 Reclassification of deferred tax assets / liabilities in the same taxing jurisdictions.

3 unchanged sentences

STATEMENTS OF CASH FLOWS

For the Nine Months Ended July 27, 2025 and July 28, 2024

For the Three Months Ended February 1, 2026 and January 26, 2025

Cash Flows from Operating Activities

Adjustments to reconcile net income to net cash provided by operating activities:

Adjustments to reconcile net income to net cash provided by (used for) operating activities:

Provision for credit losses

Provision for depreciation and amortization

Depreciation and amortization

Impairments and other adjustments

7 unchanged sentences

Retirement benefits

Net cash provided by operating activities

Net cash provided by (used for) operating activities

Cash Flows from Investing Activities

3 unchanged sentences

Cost of receivables acquired (excluding receivables related to sales)

Acquisitions of businesses, net of cash acquired

Purchases of marketable securities

1 unchanged sentence

Cost of equipment on operating leases acquired

Decrease in investment in Financial Services

Increase in trade and wholesale receivables

Decrease in trade and wholesale receivables

Collections of receivables from unconsolidated affiliates

Collateral on derivatives – net

Net cash used for investing activities

Net cash provided by (used for) investing activities

Cash Flows from Financing Activities

4 unchanged sentences

Repurchases of common stock

Capital returned to Equipment Operations

Dividends paid

4 unchanged sentences

Cash, Cash Equivalents, and Restricted Cash at End of Period

Components of Cash, Cash Equivalents, and Restricted Cash

Cash and cash equivalents

Cash, cash equivalents, and restricted cash (Assets held for sale)

Restricted cash (Other assets)

Total Cash, Cash Equivalents, and Restricted Cash

11 Elimination of depreciation on leases related to inventory transferred to equipment on operating leases.

4 unchanged sentences

16 Reclassification of sales incentive accruals on receivables sold to Financial Services.

17 Elimination of change in investment from equipment operations to financial services .

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis