Deere & Co. (DE) saw its shares plummet 5.7% during Wednesday's trading session after the agricultural equipment giant issued a weaker-than-expected fiscal 2026 outlook, overshadowing its better-than-anticipated Q4 results.

The company forecasted net income of $4 billion to $4.75 billion for FY2026, significantly below the $5.3 billion analysts had projected. CEO John May cited ongoing margin pressures from tariffs, which are expected to double to $1.2 billion next year, and persistent challenges in the large agriculture sector as key headwinds. While Q4 revenue rose 11% to $12.4 billion, beating estimates, investors focused on the disappointing guidance.

"We believe 2026 will mark the bottom of the large ag cycle," May said, acknowledging the difficult market conditions. Analysts noted that Deere's outlook reflects deeper-than-expected weakness in North American large-equipment demand, despite expected growth in its smaller agriculture and construction segments.