AGCO Corp (NYSE:AGCO) announced its second-quarter financial results on Thursday, which surpassed analyst expectations. The results were driven by disciplined execution in a challenging agricultural market.
AGCO is challenging its highest level of the year. See real-time price here.
AGCO’s shares traded higher following the announcement, as the company also raised its full-year 2025 guidance for both adjusted EPS and net sales.
The global leader in agricultural machinery and precision technology reported adjusted earnings per share of $1.35, significantly beating the consensus estimate of $1.07. Net sales for the quarter were $2.63 billion, down 18.8% year over year but above the $2.50 billion analyst estimate.
The sales decline largely reflects the divestiture of the majority of AGCO’s Grain & Protein business in the fourth quarter of 2024. Excluding the impact of the divestiture and a favorable foreign currency translation of 3.5%, comparable net sales were down 22.3% YoY.
Reported earnings per share for the quarter were $4.22, a notable improvement from a reported net loss of $(4.92) per share in the second quarter of 2024.
Also Read: AGCO) on Thursday announced its second-quarter financial results, which surpassed analyst expectations. The results were driven by disciplined execution in a challenging agricultural market. AGCO's shares traded higher following the announcement, as the company also raised its full-year 2025 guidance for both adjusted EPS and net sales. The global leader in agricultural machinery and precision technology reported adjusted earnings per share of $1.35, significantly beating the consensus estimate of $1.07. Net sales for the quarter were $2.63 billion, down 18.8% year over year but above the $2.50 billion analyst estimate. The sales decline largely reflects the divestiture of the majority of AGCO's Grain & Protein business in the fourth quarter of 2024. Excluding the impact of the divestiture and a favorable foreign currency translation of 3.5%, comparable net sales were down 22.3% YoY. Reported earnings per share for the quarter were $4.22, a notable improvement from a reported net loss of $(4.92) per share in the second quarter of 2024. Also Read: These 2025 Outperformers Just Unlocked Buyback Fuel "AGCO achieved solid second-quarter results with deliberate execution in the areas we can control despite a challenging global agricultural environment marked by weak farm economics and delayed purchasing decisions in several parts of the world," said Eric Hansotia, AGCO's chairman, president and CEO. "Our strong earnings and cash flow generation illustrate meaningful progress in reducing dealer and company inventories through aggressive production cuts. Operating margins benefited from disciplined cost control and continued implementation of our restructuring initiatives. Demand for our premium brands remains resilient, supported by growing interest in precision agriculture and sustainable technologies," added Hansotia. The company reported a 6.2% operating margin for the quarter, a significant improvement from the negative 7.4% in the same period last year. Adjusted operating margin was 8.3% down from 10.3% a year ago. Regionally, North American net sales, excluding currency impacts, fell 32.2% due to softer industry sales and efforts to manage inventory, particularly impacting high-horsepower tractors, sprayers, and hay equipment. The North American operating margin was negative 5.3%. In Europe/Middle East (EME), net sales declined 11.2% excluding currency translation, with lower sales in most Western European markets partially offset by growth in Eastern Europe and Scandinavia. EME's operating margin was 14.7%. South American net sales, excluding currency impacts, decreased 4.7% due to dealer inventory de-stocking, but the region achieved a robust operating margin of 7.8% from improved product mix and factory efficiency. Net sales in Asia/Pacific/Africa (APA) decreased 5.9%, excluding favorable currency translation impacts, driven by weaker demand and lower production volumes, resulting in an APA operating margin of 6.9%. Year-to-date free cash flow generation has been strong, totaling $63 million through June 2025. This compares favorably to cash used in operating activities of $370 million a year ago, primarily due to effective working capital management. Hansotia noted the increasing complexity of the global trade landscape, which continues to impact farmer confidence, particularly in North America and Europe. He highlighted a growing interest in precision agriculture tools that offer efficiency gains without significant capital investment, signaling a shift in farmer purchasing priorities. Outlook Raised: The company now expects adjusted EPS to be between $4.75 and $5.00, up from the previous range of $4.00-$4.50, and above the $4.21 analyst estimate. Full-year net sales are now projected to be approximately $9.80 billion, an increase from the prior $9.60 billion outlook and higher than the $9.617 billion consensus. Price Action: AGCO shares are trading higher by 10.68% at $118.02 at the last check on Thursday. Read Next: Air Products Trims Earnings Outlook On Portfolio Optimization And Project Exits">These 2025 Outperformers Just Unlocked Buyback Fuel
「AGCO achieved solid second-quarter results with deliberate execution in the areas we can control despite a challenging global agricultural environment marked by weak farm economics and delayed purchasing decisions in several parts of the world,」 said Eric Hansotia, AGCO’s chairman, president and CEO.
「Our strong earnings and cash flow generation illustrate meaningful progress in reducing dealer and company inventories through aggressive production cuts. Operating margins benefited from disciplined cost control and continued implementation of our restructuring initiatives. Demand for our premium brands remains resilient, supported by growing interest in precision agriculture and sustainable technologies,」 added Hansotia.
The company reported a 6.2% operating margin for the quarter, a significant improvement from the negative 7.4% in the same period last year. Adjusted operating margin was 8.3% down from 10.3% a year ago.
Regionally, North American net sales, excluding currency impacts, fell 32.2% due to softer industry sales and efforts to manage inventory, particularly impacting high-horsepower tractors, sprayers, and hay equipment. The North American operating margin was negative 5.3%.
In Europe/Middle East (EME), net sales declined 11.2% excluding currency translation, with lower sales in most Western European markets partially offset by growth in Eastern Europe and Scandinavia. EME’s operating margin was 14.7%.
South American net sales, excluding currency impacts, decreased 4.7% due to dealer inventory de-stocking, but the region achieved a robust operating margin of 7.8% from improved product mix and factory efficiency.
Net sales in Asia/Pacific/Africa (APA) decreased 5.9%, excluding favorable currency translation impacts, driven by weaker demand and lower production volumes, resulting in an APA operating margin of 6.9%.
Year-to-date free cash flow generation has been strong, totaling $63 million through June 2025. This compares favorably to cash used in operating activities of $370 million a year ago, primarily due to effective working capital management.
Hansotia noted the increasing complexity of the global trade landscape, which continues to impact farmer confidence, particularly in North America and Europe. He highlighted a growing interest in precision agriculture tools that offer efficiency gains without significant capital investment, signaling a shift in farmer purchasing priorities.
Outlook Raised: The company now expects adjusted EPS to be between $4.75 and $5, up from the previous range of $4-$4.50, and above the $4.21 analyst estimate.
Full-year net sales are now projected to be approximately $9.80 billion, an increase from the prior $9.60 billion outlook and higher than the $9.617 billion consensus.
AGCO Price Action: AGCO shares were trading higher by 10.65% at $117.99 at publication on Thursday.
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Photo: Courtesy Agco