The results pushed shares of the world’s largest farm equipment maker up 3% in pre-market trade and allayed fears about the impact of a workers’ strike that had hit Deere operations for about three. weeks of the fourth trimester.
Rising corn and soybean prices this year have improved the financial outlook for farmers, with the U.S. Department of Agriculture estimating net farm income to rise 19.5 percent to $ 113 billion in 2021.
This pushed up sales of farm equipment despite price hikes from manufacturers. Deere said sales of its large and medium equipment jumped 23% in the quarter, while sales of small farm equipment and turf grew 17%.
The company increased the prices of 8% of its orders for large and medium equipment to compensate for the rise in inflation, thus helping to fatten its margins.
Net income reached $ 1.28 billion, or $ 4.12 per share, in the quarter ended Oct. 31, from $ 757 million, or $ 2.39 per share, a year earlier. Analysts on average expected earnings of $ 3.90 per share, according to Refinitiv.
Deere equipment sales rose 19% to $ 10.28 billion, below expectations of $ 10.44 billion.
Earlier this month, the company struck a new deal with its workers from the United Auto Workers union, ending a strike of nearly six weeks.