Navigate tariff challenges and …

Q: Can you talk about the current state and the future plans for the SaaS models of Deere, especially with regard to precisions -AG essentials and see & spray? A: Josh Beal, director of investor relations, said that Deere's SaaS offers are divided into three main areas: precision digital technologies, usage-based technologies such as See & Spray and future autonomous solutions. The precisions -AG essentials include core elements such as connectivity and instructions, which are offered in advance with an annual license at lower costs. Josh Jepsen, CFO, added that Deere plans to bundle these solutions in order to improve customer value across production systems.

Q: What are the key factors that influence the implicit profitability in the second half for production and precision -AG segment? A: Joshua Jepsen, CFO, found that the profitability of the second half was influenced by the tariff costs, a mix of MIX due to the lower North America Große AG production and less favorable pricing compared to the previous year. These factors in connection with lower sales change lead to higher crazy margins.

Q: How does Deere approach the pricing and early order programs for 2026 in view of the current tariff environment? A: Josh Beal said that Deere's early order programs for 2026 started with a similar structure in previous years. These programs offer price flexibility to adapt to the developing tariff environment. Deere aims to build up in accordance with retail demand after he has successfully reduced new inventory.

Q: Can you explain the strategy of Deere to manage tariff effects between stakeholders, including providers, dealers and customers? A: Josh Beal emphasized a measured approach to managing tariffs, including price promotions, optimization of procurement and cooperation with suppliers. Deere undertakes to share the tariff load between the stakeholders and at the same time to focus on cost optimization and double procurement.

Q: How does the market for used devices affect the price functions and the inventory management of Deere? A: Josh Beal emphasized that Deere has made progress in reducing used combination inventories, with the focus now on tractors with high horsepower. The pace of the used device movement is uncertain, but Deere retains a low new inventory and supports dealers with financing options for managing the used market.

You can find the complete copy of the earnings call in the complete earnings call.

This article first appeared on Gurufocus.