In each of his three campaigns, President Donald Trump received strong backing from farmers — including a significant78% supportFrom the counties in the United States that rely most heavily on agriculture. However, farmers are currently experiencing significant financial difficulties due to his extensive tariffs.
Axios reported ThursdayA well-known agricultural machinery producer, John Deere, has announced its most recent quarterly financial results. As reported by the source, the company experienced a 9 percent drop in quarterly revenue, bringing it down to $12 billion, and a significant 26 percent decrease in net income, which fell to $1.29 billion.
John Deere has also anticipated an extra $600 million in expenses this year because of Trump's tariffs (it had initially estimated $500 million), and the company is not bearing these costs alone.The Wall Street JournalIt was reported that although the company has not yet implemented a tariff surcharge, it has raised the prices of sprayers and planters by 2% to 4%. Additionally, the manufacturer has lowered its year-end profit forecast by $250 million.
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As per CFRA Research equity analyst Jonathan Sakrada, the sense of uncertainty within the agricultural industry has caused U.S. farmers to become "more cautious with their spending and less willing to agree to higher equipment costs."
John Deere's success is viewed as a reflection of the overall performance of the U.S. agricultural sector, due to its widespread presence in rural American communities. The company mentioned that its clients were "waiting and watching" to see how the tariff situation would develop before committing to significant purchases.
In reaction to John Deere's underwhelming quarterly earnings announcement, its stock pricefell by 8.4%Bloomberg stated this marked the biggest single-day drop the company had faced in over three years. The news source also indicated that steel and aluminum tariffs were primarily responsible for its decrease in profits.
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