Deere faces risks from global and regional political instability (Russia-Ukraine war, Middle East conflict), macroeconomic conditions (inflation, interest rate volatility), commodity price volatility, supply chain disruptions, equipment performance issues, product liability litigation, and changes in demand and pricing for new and used equipment. Higher interest rates negatively impact customer borrowing costs and financial services spreads. Geopolitical uncertainty and market adoption of new technologies also pose risks.
Financial Upside
Deere anticipates moderate net income growth, driven by higher average financing portfolio balances and favorable discrete tax items in financial services. Strong U.S. infrastructure spending and manufacturing investment levels are expected to partially offset construction industry declines. The company's Leap Ambitions and Smart Industrial Operating Model are intended to capitalize on technology trends, potentially increasing customer engagement and profitability.
