Deere reported a bigger-than-expected quarterly profit, as sales rose for the first time in more than three years on improving demand for its farm and construction equipment. Fred Katayama reports.
Deere's quarterly sales of farm and construction equipment rose for the first time in more than three years, and the company's rising profit and sales beat forecasts. It also bumped up its 2017 profit outlook. The strong results sent Deere stock sharply higher in early trading. Investment research firm Zacks said in a note that "despite weak global agricultural and construction sectors, Deere continues to perform well ... The company will gain from the implementation of its operating plans and disciplined cost management as well as the impact of a broad product portfolio." Deere's sales had taken a hit as lower prices for corn and soybeans left farmers with less cash to spend on equipment. To offset this, Deere cut jobs and lowered production, and that helped lift its profit. For the full year, the company hopes for a bump in sales in South America. It also sees sales in North America falling less than it had previously thought.