Deere Reports Net Income of $2.369 Billion for Fourth Quarter, $10.166 Billion for Fiscal Year

News provided by

Nov 22, 2023, 06:45 ET

Net income grows for quarter and full year, driven by solid market conditions, differentiated products, and strong execution.
Full-year 2024 earnings forecast to be $7.75 to $8.25 billion, as volumes return to mid‑cycle levels.
Ongoing focus on structural profitability, investments that deliver customer value.

MOLINE, Ill., Nov. 22, 2023 /PRNewswire/ -- Deere & Company reported net income of $2.369 billion for the fourth quarter ended October 29, 2023, or $8.26 per share, compared with net income of $2.246 billion, or $7.44 per share, for the quarter ended October 30, 2022. For fiscal-year 2023, net income attributable to Deere & Company was $10.166 billion, or $34.63 per share, compared with $7.131 billion, or $23.28 per share, in fiscal 2022.

Worldwide net sales and revenues decreased 1 percent, to $15.412 billion, for the fourth quarter of fiscal 2023 and rose 16 percent, to $61.251 billion, for the full year. Net sales were $13.801 billion for the quarter and $55.565 billion for the year, compared with $14.351 billion and $47.917 billion in 2022.

"Deere's fourth-quarter and full-year results can be attributed to the successful execution of our Smart Industrial Operating Model and the value that customers recognize in our industry-leading products and solutions," said John C. May, chairman and chief executive officer. "We must also recognize and credit our dedicated employees, dealers, and suppliers, whose hard work and focus have been instrumental to our overall success."

Company Outlook & Summary

Net income attributable to Deere & Company for fiscal 2024 is forecasted to be in a range of $7.75 billion to $8.25 billion.

"While our end markets will fluctuate, we remain focused on disciplined execution and strategically investing in solutions that drive customer value," May said. "As evidenced by our guidance for 2024, we are demonstrating higher levels of through-cycle structural profitability while making our company more resilient and better equipped for the future."


Deere & Company	Fourth Quarter					Full Year
$ in millions, except per share amounts	2023		2022		% Change	2023		2022		% Change
Net sales and revenues	$	15,412	$	15,536	-1 %	$	61,251	$	52,577	16 %
Net income	$	2,369	$	2,246	5 %	$	10,166	$	7,131	43 %
Fully diluted EPS	$	8.26	$	7.44		$	34.63	$	23.28

Results for the presented periods were affected by special items. See Note 1 of the financial statements for further details.


Production & Precision Agriculture	Fourth Quarter
$ in millions	2023		2022		% Change
Net sales	$	6,965	$	7,434	-6 %
Operating profit	$	1,836	$	1,740	6 %
Operating margin		26.4 %		23.4 %

Production and precision agriculture sales decreased for the quarter due to lower shipment volumes partially offset by price realization. Operating profit improved primarily due to price realization partially offset by lower shipment volumes / sales mix and higher SA&G and R&D expenses. The prior period was impacted by higher reserves on assets in Russia.


Small Agriculture & Turf	Fourth Quarter
$ in millions	2023		2022		% Change
Net sales	$	3,094	$	3,544	-13 %
Operating profit	$	444	$	506	-12 %
Operating margin		14.4 %		14.3 %

Small agriculture and turf sales decreased for the quarter due to lower shipment volumes partially offset by price realization. Operating profit decreased due to lower shipment volumes / sales mix and higher SA&G and R&D expenses, partially offset by price realization.


Construction & Forestry	Fourth Quarter
$ in millions	2023		2022		% Change
Net sales	$	3,742	$	3,373	11 %
Operating profit	$	516	$	414	25 %
Operating margin		13.8 %		12.3 %

Construction and forestry sales increased for the quarter due to price realization and higher shipment volumes. Operating profit improved primarily due to price realization, partially offset by higher production costs, less-favorable sales mix, the unfavorable effects of foreign currency exchange, and a loss on the sale of the Russian roadbuilding business. The prior period was impacted by higher reserves on assets in Russia.


Financial Services	Fourth Quarter
$ in millions	2023		2022		% Change
Net income	$	190	$	232	-18 %

Financial services net income for the quarter decreased due to unfavorable derivative valuation adjustments, less-favorable financing spreads, and a higher provision for credit losses (excluding reserves in Russia). These factors were partially offset by income earned on a higher average portfolio. In the fourth quarter of 2022, financial services increased its reserves for credit losses in Russia and recorded an intercompany benefit from the equipment operations, which guarantees the financial services' investment in certain international markets, including Russia.


Industry Outlook for Fiscal 2024
Agriculture & Turf
U.S. & Canada:
Large Ag						Down 10 to 15%
Small Ag & Turf						Down 5 to 10%
Europe						Down ~10%
South America (Tractors & Combines)						Down ~10%
Asia						Down moderately

Construction & Forestry
U.S. & Canada:
Construction Equipment						Down 5 to 10%
Compact Construction Equipment						Flat to Down 5%
Global Forestry						Down ~10%
Global Roadbuilding						Flat


Deere Segment Outlook for Fiscal 2024		Currency	Price
$ in millions	Net Sales	Translation	Realization
Production & Precision Ag	Down 15 to 20%	~ Flat	+1.5 %
Small Ag & Turf	Down 10 to 15%	~ Flat	+1.0 %
Construction & Forestry	Down ~10%	~ Flat	+1.5 %

Financial Services	Net Income	~ $770

Financial Services. Fiscal-year 2024 net income attributable to Deere & Company for the financial services operations is forecast to be approximately $770 million. Results are expected to be higher in 2024 due to income earned on a higher average portfolio, partially offset by less-favorable financing spreads and lower gains on operating-lease residual values. A correction of the accounting treatment for financing incentives offered to John Deere dealers impacted 2023 financial results. See Note 1 of the financial statements for further details.

FORWARD-LOOKING STATEMENTS

Certain statements contained herein, including in the section entitled "Company Outlook & Summary," "Industry Outlook," and "Deere Segment Outlook," relating to future events, expectations, and trends constitute "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995 and involve factors that are subject to change, assumptions, risks, and uncertainties that could cause actual results to differ materially. Some of these risks and uncertainties could affect all lines of the company's operations generally while others could more heavily affect a particular line of business.

Forward-looking statements are based on currently available information and current assumptions, expectations, and projections about future events and should not be relied upon. Except as required by law, the company expressly disclaims any obligation to update or revise its forward-looking statements. Many factors, risks, and uncertainties could cause actual results to differ materially from these forward-looking statements. Among these factors are risks related to:

changes in U.S., foreign and international laws, regulations, and policies relating to trade, spending, taxing, banking, monetary, environmental (including climate change and engine emission), and farming policies;
political, economic, and social instability of the geographies in which the company operates, including the ongoing war between Russia and Ukraine and the war between Israel and Hamas;
adverse macroeconomic conditions, including unemployment, inflation, rising interest rates, changes in consumer practices due to slower economic growth or possible recession, and regional or global liquidity constraints;
growth and sustainability of non-food uses for crops (including ethanol and biodiesel production);
the ability to execute business strategies, including the company's Smart Industrial Operating Model, Leap Ambitions, and mergers and acquisitions;
the ability to understand and meet customers' changing expectations and demand for John Deere products and solutions;
accurately forecasting customer demand for products and services and adequately managing inventory;
the ability to integrate new technology, including automation and machine learning, and deliver precision technology and solutions to customers;
changes to governmental communications channels (radio frequency technology);
the ability to adapt in highly competitive markets;
dealer practices and their ability to manage distribution of John Deere products and support and service precision technology solutions;
changes in climate patterns, unfavorable weather events, and natural disasters;
governmental and other actions designed to address climate change in connection with a transition to a lower-carbon economy;
higher interest rates and currency fluctuations which could adversely affect the U.S. dollar, customer confidence, access to capital, and demand for John Deere products and solutions;
availability and price of raw materials, components, and whole goods;
delays or disruptions in the company's supply chain;
labor relations and contracts, including work stoppages and other disruptions;
the ability to attract, develop, engage, and retain qualified personnel;
security breaches, cybersecurity attacks, technology failures, and other disruptions to John Deere information technology infrastructure and products;
loss of or challenges to intellectual property rights;
compliance with evolving U.S. and foreign laws, including economic sanctions, data privacy, and environmental laws and regulations;
legislation introduced or enacted that could affect the company's business model and intellectual property, such as so-called right to repair or right to modify legislation;
investigations, claims, lawsuits, or other legal proceedings;
events that damage the company's reputation or brand;
world grain stocks, available farm acres, soil conditions, harvest yields, prices for commodities and livestock, input costs, and availability of transport for crops; and
housing starts and supply, real estate and housing prices, levels of public and non-residential construction, and infrastructure investment.

Further information concerning the company and its businesses, including factors that could materially affect the financial results, is included in the company's filings with the SEC (including, but not limited to, the factors discussed in Item 1A. "Risk Factors" of the most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q). There also may be other factors that the company cannot anticipate or that are not described herein because the company does not currently perceive them to be material.

DEERE & COMPANY FOURTH QUARTER 2023 PRESS RELEASE (In millions of dollars) Unaudited
	Three Months Ended					Years Ended
	October 29		October 30		%	October 29		October 30		%
	2023		2022		Change	2023		2022		Change
Net sales and revenues:
Production & precision ag net sales	$	6,965	$	7,434	-6	$	26,790	$	22,002	+22
Small ag & turf net sales		3,094		3,544	-13		13,980		13,381	+4
Construction & forestry net sales		3,742		3,373	+11		14,795		12,534	+18
Financial services revenues		1,347		988	+36		4,721		3,625	+30
Other revenues		264		197	+34		965		1,035	-7
Total net sales and revenues	$	15,412	$	15,536	-1	$	61,251	$	52,577	+16

Operating profit: *
Production & precision ag	$	1,836	$	1,740	+6	$	6,996	$	4,386	+60
Small ag & turf		444		506	-12		2,472		1,949	+27
Construction & forestry		516		414	+25		2,695		2,014	+34
Financial services		229		297	-23		795		1,159	-31
Total operating profit		3,025		2,957	+2		12,958		9,508	+36
Reconciling items **		51		(68)			79		(370)
Income taxes		(707)		(643)	+10		(2,871)		(2,007)	+43
Net income attributable to Deere & Company	$	2,369	$	2,246	+5	$	10,166	$	7,131	+43

*	Operating profit is income from continuing operations before corporate expenses, certain external interest expense, certain foreign exchange gains and losses, and income taxes. Operating profit for financial services includes the effect of interest expense and foreign exchange gains or losses.
**	Reconciling items are primarily corporate expenses, certain interest income and expenses, certain foreign exchange gains and losses, pension and postretirement benefit costs excluding the service cost component, equity in income of unconsolidated affiliates, and net income attributable to noncontrolling interests.

DEERE & COMPANY STATEMENTS OF CONSOLIDATED INCOME For the Three Months and Years Ended October 29, 2023 and October 30, 2022 (In millions of dollars and shares except per share amounts) Unaudited
	Three Months Ended				Years Ended
	2023		2022		2023		2022
Net Sales and Revenues
Net sales	$	13,801	$	14,351	$	55,565	$	47,917
Finance and interest income		1,357		925		4,683		3,365
Other income		254		260		1,003		1,295
Total		15,412		15,536		61,251		52,577

Costs and Expenses
Cost of sales		9,427		10,214		37,715		35,338
Research and development expenses		606		576		2,177		1,912
Selling, administrative and general expenses		1,203		1,192		4,595		3,863
Interest expense		781		348		2,453		1,062
Other operating expenses		322		320		1,292		1,275
Total		12,339		12,650		48,232		43,450

Income of Consolidated Group before Income Taxes		3,073		2,886		13,019		9,127
Provision for income taxes		707		643		2,871		2,007

Income of Consolidated Group		2,366		2,243		10,148		7,120
Equity in income of unconsolidated affiliates		2		1		7		10

Net Income		2,368		2,244		10,155		7,130
Less: Net loss attributable to noncontrolling interests		(1)		(2)		(11)		(1)
Net Income Attributable to Deere & Company	$	2,369	$	2,246	$	10,166	$	7,131

Per Share Data
Basic	$	8.30	$	7.48	$	34.80	$	23.42
Diluted		8.26		7.44		34.63		23.28
Dividends declared		1.35		1.13		5.05		4.36
Dividends paid		1.25		1.13		4.83		4.28

Average Shares Outstanding
Basic		285.5		300.4		292.2		304.5
Diluted		286.9		302.1		293.6		306.3

See Condensed Notes to Consolidated Financial Statements.

DEERE & COMPANY CONDENSED CONSOLIDATED BALANCE SHEETS As of October 29, 2023 and October 30, 2022 (In millions of dollars) Unaudited
	2023		2022
Assets
Cash and cash equivalents	$	7,458	$	4,774
Marketable securities		946		734
Trade accounts and notes receivable – net		7,739		6,410
Financing receivables – net		43,673		36,634
Financing receivables securitized – net		7,335		5,936
Other receivables		2,623		2,492
Equipment on operating leases – net		6,917		6,623
Inventories		8,160		8,495
Property and equipment – net		6,879		6,056
Goodwill		3,900		3,687
Other intangible assets – net		1,133		1,218
Retirement benefits		3,007		3,730
Deferred income taxes		1,814		824
Other assets		2,503		2,417
Total Assets	$	104,087	$	90,030

Liabilities and Stockholders' Equity

Liabilities
Short-term borrowings	$	17,939	$	12,592
Short-term securitization borrowings		6,995		5,711
Accounts payable and accrued expenses		16,130		14,822
Deferred income taxes		520		495
Long-term borrowings		38,477		33,596
Retirement benefits and other liabilities		2,140		2,457
Total liabilities		82,201		69,673

Redeemable noncontrolling interest		97		92

Stockholders' Equity
Total Deere & Company stockholders' equity		21,785		20,262
Noncontrolling interests		4		3
Total stockholders' equity		21,789		20,265
Total Liabilities and Stockholders' Equity	$	104,087	$	90,030

See Condensed Notes to Consolidated Financial Statements.

DEERE & COMPANY STATEMENTS OF CONSOLIDATED CASH FLOWS For the Years Ended October 29, 2023 and October 30, 2022 (In millions of dollars) Unaudited
	2023		2022
Cash Flows from Operating Activities
Net income	$	10,155	$	7,130
Adjustments to reconcile net income to net cash provided by operating activities:
Provision (credit) for credit losses		(16)		192
Provision for depreciation and amortization		2,004		1,895
Impairments and other adjustments		191		88
Share-based compensation expense		130		85
Gain on remeasurement of previously held equity investment				(326)
Credit for deferred income taxes		(790)		(66)
Changes in assets and liabilities:
Receivables related to sales		(4,253)		(2,483)
Inventories		279		(2,091)
Accounts payable and accrued expenses		830		1,133
Accrued income taxes payable/receivable		(23)		141
Retirement benefits		(170)		(1,015)
Other		252		16
Net cash provided by operating activities		8,589		4,699

Cash Flows from Investing Activities
Collections of receivables (excluding receivables related to sales)		23,051		20,907
Proceeds from sales of equipment on operating leases		1,981		2,093
Cost of receivables acquired (excluding receivables related to sales)		(28,772)		(26,300)
Acquisitions of businesses, net of cash acquired		(82)		(498)
Purchases of property and equipment		(1,498)		(1,134)
Cost of equipment on operating leases acquired		(2,970)		(2,654)
Collateral on derivatives – net		(12)		(642)
Other		(447)		(257)
Net cash used for investing activities		(8,749)		(8,485)

Cash Flows from Financing Activities
Net proceeds in short-term borrowings (original maturities three months or less)		4,008		3,852
Proceeds from borrowings issued (original maturities greater than three months)		15,429		10,358
Payments of borrowings (original maturities greater than three months)		(7,913)		(8,445)
Repurchases of common stock		(7,216)		(3,597)
Dividends paid		(1,427)		(1,313)
Other		(73)		(29)
Net cash provided by financing activities		2,808		826

Effect of Exchange Rate Changes on Cash, Cash Equivalents, and Restricted Cash		31		(224)

Net Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash		2,679		(3,184)
Cash, Cash Equivalents, and Restricted Cash at Beginning of Year		4,941		8,125
Cash, Cash Equivalents, and Restricted Cash at End of Year	$	7,620	$	4,941

See Condensed Notes to Consolidated Financial Statements.

DEERE & COMPANY
Condensed Notes to Consolidated Financial Statements
(In millions of dollars) Unaudited

(1)	Special Items
	2023
	In the fourth quarter of 2023, the company sold its Russian roadbuilding business, recognizing a loss of $18 million (pretax and after-tax). The loss was recorded in "Other operating expenses" in the construction and forestry segment.
	In the third quarter of 2023, a favorable tax ruling in Brazil allowed the company to record a $243 million reduction in the provision for income taxes and $47 million of interest income.
	In the second quarter of 2023, the company corrected the accounting treatment for financing incentives offered to John Deere dealers, which impacted the timing of expense recognition and the presentation of incentive costs in the consolidated financial statements. The cumulative effect of this correction, $173 million pretax ($135 million after-tax), was recorded in the second quarter of 2023. Prior period results for Deere & Company were not restated, as the adjustment is considered immaterial to the company's financial statements.
	2022
	In the second quarter of 2022, the company acquired full ownership of three former Deere-Hitachi joint venture factories. The remeasurement of the previously held equity investment resulted in a non-cash gain of $326 million (pretax and after-tax).
	In the second quarter of 2022, the company suspended shipments of machines and service parts to Russia. As a result, the company impaired its long-lived assets, increased reserves of certain financial assets, introduced an employee voluntary-separation program, and recorded an accrual for various contractual uncertainties. In the fourth quarter of 2022, the company increased its reserves for credit losses, reflecting further economic uncertainty in Russia. The financial services received an intercompany benefit from the equipment operations, which guarantees the financial services' investment in certain international markets, including Russia.
	In the first quarter of 2022, the company had a one-time payment related to the ratification of the UAW collective bargaining agreement, totaling $90 million.
	The following table summarizes the operating profit impact, in millions of dollars, of the special items recorded for the three months and fiscal years ended October 29, 2023 and October 30, 2022:


	Three Months									Fiscal Years
	PPA		SAT		CF		FS	Total		PPA		SAT		CF		FS		Total
2023 Expense:
Russian roadbuilding sale – Other operating expense					$	18		$	18					$	18			$	18
Financing incentive – SA&G expense																$	173		173
Total expense						18			18						18		173		191

2022 Expense (benefit):
Gain on remeasurement of equity investment – Other income															(326)				(326)
Total Russia/Ukraine events expense	$	70	$	8		50			128	$	133	$	11		110		1		255
UAW ratification bonus – Cost of sales											53		9		28				90
Total expense (benefit)		70		8		50			128		186		20		(188)		1		19

Period over period change	$	(70)	$	(8)	$	(32)		$	(110)	$	(186)	$	(20)	$	206	$	172	$	172

(2)

The consolidated financial statements represent the consolidation of all Deere & Company's subsidiaries. The supplemental consolidating data is presented for informational purposes. Transactions between the Equipment Operations and Financial Services have been eliminated to arrive at the consolidated financial statements. In the supplemental consolidating data in Note 3 to the financial statements, the "Equipment Operations" represents the enterprise without "Financial Services", which include the company's production and precision agriculture operations, small agriculture and turf operations, and construction and forestry operations, and other corporate assets, liabilities, revenues, and expenses not reflected within "Financial Services."

DEERE & COMPANY (3) SUPPLEMENTAL CONSOLIDATING DATA STATEMENTS OF INCOME For the Three Months Ended October 29, 2023 and October 30, 2022 (In millions of dollars) Unaudited
	EQUIPMENT				FINANCIAL
	OPERATIONS				SERVICES				ELIMINATIONS				CONSOLIDATED
	2023		2022		2023		2022		2023		2022		2023		2022
Net Sales and Revenues
Net sales	$	13,801	$	14,351									$	13,801	$	14,351
Finance and interest income		193		83	$	1,445	$	1,003	$	(281)	$	(161)		1,357		925	¹
Other income		218		233		121		231		(85)		(204)		254		260	^{2, 3}
Total		14,212		14,667		1,566		1,234		(366)		(365)		15,412		15,536

Costs and Expenses
Cost of sales		9,433		10,215						(6)		(1)		9,427		10,214	⁴
Research and development expenses		606		576										606		576
Selling, administrative and general expenses		980		922		225		272		(2)		(2)		1,203		1,192	⁴
Interest expense		114		93		757		306		(90)		(51)		781		348	¹
Interest compensation to Financial Services		191		110						(191)		(110)					¹
Other operating expenses		45		163		354		358		(77)		(201)		322		320	^{5, 6}
Total		11,369		12,079		1,336		936		(366)		(365)		12,339		12,650

Income before Income Taxes		2,843		2,588		230		298						3,073		2,886
Provision for income taxes		665		576		42		67						707		643

Income after Income Taxes		2,178		2,012		188		231						2,366		2,243
Equity in income of unconsolidated affiliates						2		1						2		1

Net Income		2,178		2,012		190		232						2,368		2,244
Less: Net loss attributable to noncontrolling interests		(1)		(2)										(1)		(2)
Net Income Attributable to Deere & Company	$	2,179	$	2,014	$	190	$	232					$	2,369	$	2,246

¹	Elimination of intercompany interest income and expense.
²	Elimination of Equipment Operations' margin from inventory transferred to equipment on operating leases.
³	Elimination of Financial Services' income related to intercompany guarantees of investments in certain international markets and intercompany service revenues.
⁴	Elimination of intercompany service fees.
⁵	Elimination of Financial Services' lease depreciation expense related to inventory transferred to equipment on operating leases.
⁶	Elimination of Equipment Operations' expense related to intercompany guarantees of investments in certain international markets and intercompany service expenses.

DEERE & COMPANY SUPPLEMENTAL CONSOLIDATING DATA (Continued) STATEMENTS OF INCOME For the Years Ended October 29, 2023 and October 30, 2022 (In millions of dollars) Unaudited
	EQUIPMENT				FINANCIAL
	OPERATIONS				SERVICES				ELIMINATIONS				CONSOLIDATED
	2023		2022		2023		2022		2023		2022		2023		2022
Net Sales and Revenues
Net sales	$	55,565	$	47,917									$	55,565	$	47,917
Finance and interest income		636		213	$	5,055	$	3,583	$	(1,008)	$	(431)		4,683		3,365	¹
Other income		858		1,261		499		502		(354)		(468)		1,003		1,295	^{2, 3}
Total		57,059		49,391		5,554		4,085		(1,362)		(899)		61,251		52,577

Costs and Expenses
Cost of sales		37,739		35,341						(24)		(3)		37,715		35,338	⁴
Research and development expenses		2,177		1,912										2,177		1,912
Selling, administrative and general expenses		3,611		3,137		994		735		(10)		(9)		4,595		3,863	⁴
Interest expense		411		390		2,362		799		(320)		(127)		2,453		1,062	¹
Interest compensation to Financial Services		687		299						(687)		(299)					¹
Other operating expenses		217		350		1,396		1,386		(321)		(461)		1,292		1,275	^{5, 6}
Total		44,842		41,429		4,752		2,920		(1,362)		(899)		48,232		43,450

Income before Income Taxes		12,217		7,962		802		1,165						13,019		9,127
Provision for income taxes		2,685		1,718		186		289						2,871		2,007

Income after Income Taxes		9,532		6,244		616		876						10,148		7,120
Equity in income of unconsolidated affiliates		4		6		3		4						7		10

Net Income		9,536		6,250		619		880						10,155		7,130
Less: Net loss attributable to noncontrolling interests		(11)		(1)										(11)		(1)
Net Income Attributable to Deere & Company	$	9,547	$	6,251	$	619	$	880					$	10,166	$	7,131

¹	Elimination of intercompany interest income and expense.
²	Elimination of Equipment Operations' margin from inventory transferred to equipment on operating leases.
³	Elimination of Financial Services' income related to intercompany guarantees of investments in certain international markets and intercompany service revenues.
⁴	Elimination of intercompany service fees.
⁵	Elimination of Financial Services' lease depreciation expense related to inventory transferred to equipment on operating leases.
⁶	Elimination of Equipment Operations' expense related to intercompany guarantees of investments in certain international markets and intercompany service expenses.

DEERE & COMPANY SUPPLEMENTAL CONSOLIDATING DATA (Continued) CONDENSED BALANCE SHEETS As of October 29, 2023 and October 30, 2022 (In millions of dollars) Unaudited
	EQUIPMENT				FINANCIAL
	OPERATIONS				SERVICES				ELIMINATIONS				CONSOLIDATED
	2023		2022		2023		2022		2023		2022		2023		2022
Assets
Cash and cash equivalents	$	5,720	$	3,767	$	1,738	$	1,007					$	7,458	$	4,774
Marketable securities		104		61		842		673						946		734
Receivables from Financial Services		4,516		6,569					$	(4,516)	$	(6,569)					⁷
Trade accounts and notes receivable – net		1,320		1,273		8,687		6,434		(2,268)		(1,297)		7,739		6,410	⁸
Financing receivables – net		64		47		43,609		36,587						43,673		36,634
Financing receivables securitized – net						7,335		5,936						7,335		5,936
Other receivables		1,813		1,670		869		832		(59)		(10)		2,623		2,492	⁸
Equipment on operating leases – net						6,917		6,623						6,917		6,623
Inventories		8,160		8,495										8,160		8,495
Property and equipment – net		6,843		6,021		36		35						6,879		6,056
Goodwill		3,900		3,687										3,900		3,687
Other intangible assets – net		1,133		1,218										1,133		1,218
Retirement benefits		2,936		3,666		72		66		(1)		(2)		3,007		3,730	⁹
Deferred income taxes		2,133		940		68		45		(387)		(161)		1,814		824	¹⁰
Other assets		1,948		1,794		559		626		(4)		(3)		2,503		2,417
Total Assets	$	40,590	$	39,208	$	70,732	$	58,864	$	(7,235)	$	(8,042)	$	104,087	$	90,030

Liabilities and Stockholders' Equity

Liabilities
Short-term borrowings	$	1,230	$	1,040	$	16,709	$	11,552					$	17,939	$	12,592
Short-term securitization borrowings						6,995		5,711						6,995		5,711
Payables to Equipment Operations						4,516		6,569	$	(4,516)	$	(6,569)					⁷
Accounts payable and accrued expenses		14,862		12,962		3,599		3,170		(2,331)		(1,310)		16,130		14,822	⁸
Deferred income taxes		452		380		455		276		(387)		(161)		520		495	¹⁰
Long-term borrowings		7,210		7,917		31,267		25,679						38,477		33,596
Retirement benefits and other liabilities		2,032		2,351		109		108		(1)		(2)		2,140		2,457	⁹
Total liabilities		25,786		24,650		63,650		53,065		(7,235)		(8,042)		82,201		69,673

Redeemable noncontrolling interest		97		92										97		92

Stockholders' Equity
Total Deere & Company stockholders' equity		21,785		20,262		7,082		5,799		(7,082)		(5,799)		21,785		20,262	¹¹
Noncontrolling interests		4		3										4		3
Financial Services equity		(7,082)		(5,799)						7,082		5,799					¹¹
Adjusted total stockholders' equity		14,707		14,466		7,082		5,799						21,789		20,265
Total Liabilities and Stockholders' Equity	$	40,590	$	39,208	$	70,732	$	58,864	$	(7,235)	$	(8,042)	$	104,087	$	90,030

⁷	Elimination of receivables / payables between Equipment Operations and Financial Services.
⁸	Primarily reclassification of sales incentive accruals on receivables sold to Financial Services.
⁹	Reclassification of net pension assets / liabilities.
¹⁰	Reclassification of deferred tax assets / liabilities in the same taxing jurisdictions.
¹¹	Elimination of Financial Services' equity.

DEERE & COMPANY SUPPLEMENTAL CONSOLIDATING DATA (Continued) STATEMENTS OF CASH FLOWS For the Years Ended October 29, 2023 and October 30, 2022 (In millions of dollars) Unaudited
	EQUIPMENT				FINANCIAL
	OPERATIONS				SERVICES				ELIMINATIONS				CONSOLIDATED
	2023		2022		2023		2022		2023		2022		2023		2022
Cash Flows from Operating Activities
Net income	$	9,536	$	6,250	$	619	$	880					$	10,155	$	7,130
Adjustments to reconcile net income to net cash provided by operating activities:
Provision (credit) for credit losses		7		3		(23)		189						(16)		192
Provision (credit) for depreciation and amortization		1,123		1,041		1,016		1,050	$	(135)	$	(196)		2,004		1,895	¹²
Impairments and other adjustments		18		88		173								191		88
Share-based compensation expense										130		85		130		85	¹³
Gain on remeasurement of previously held equity investment				(326)												(326)
Distributed earnings of Financial Services		215		444						(215)		(444)					¹⁴
Provision (credit) for deferred income taxes		(959)		8		169		(74)						(790)		(66)
Changes in assets and liabilities:
Receivables related to sales		(58)		(189)						(4,195)		(2,294)		(4,253)		(2,483)	^{15, 17, 18}
Inventories		474		(1,924)						(195)		(167)		279		(2,091)	¹⁶
Accounts payable and accrued expenses		1,352		1,444		449		143		(971)		(454)		830		1,133	¹⁷
Accrued income taxes payable/receivable		8		166		(31)		(25)						(23)		141
Retirement benefits		(164)		(1,016)		(6)		1						(170)		(1,015)
Other		367		250		(51)		(287)		(64)		53		252		16	^{12, 13, 16}
Net cash provided by operating activities		11,919		6,239		2,315		1,877		(5,645)		(3,417)		8,589		4,699

Cash Flows from Investing Activities
Collections of receivables (excluding receivables related to sales)						24,128		22,400		(1,077)		(1,493)		23,051		20,907	¹⁵
Proceeds from sales of equipment on operating leases						1,981		2,093						1,981		2,093
Cost of receivables acquired (excluding receivables related to sales)						(29,229)		(26,903)		457		603		(28,772)		(26,300)	¹⁵
Acquisitions of businesses, net of cash acquired		(82)		(498)										(82)		(498)
Purchases of property and equipment		(1,494)		(1,131)		(4)		(3)						(1,498)		(1,134)
Cost of equipment on operating leases acquired						(3,234)		(2,879)		264		225		(2,970)		(2,654)	¹⁶
Increase (decrease) in investment in Financial Services		(870)		7						870		(7)					¹⁹
Increase in trade and wholesale receivables						(5,783)		(3,601)		5,783		3,601					¹⁵
Collateral on derivatives – net		(1)		5		(11)		(647)						(12)		(642)
Other		(290)		(213)		(160)		(81)		3		37		(447)		(257)	¹⁸
Net cash used for investing activities		(2,737)		(1,830)		(12,312)		(9,621)		6,300		2,966		(8,749)		(8,485)

Cash Flows from Financing Activities
Net proceeds (payments) in short-term borrowings (original maturities three months or less)		(113)		136		4,121		3,716						4,008		3,852
Change in intercompany receivables/payables		2,090		(1,633)		(2,090)		1,633
Proceeds from borrowings issued (original maturities greater than three months)		342		138		15,087		10,220						15,429		10,358
Payments of borrowings (original maturities greater than three months)		(901)		(1,356)		(7,012)		(7,089)						(7,913)		(8,445)
Repurchases of common stock		(7,216)		(3,597)										(7,216)		(3,597)
Capital investment from Equipment Operations						870		(7)		(870)		7					¹⁹
Dividends paid		(1,427)		(1,313)		(215)		(444)		215		444		(1,427)		(1,313)	¹⁴
Other		(7)		6		(66)		(35)						(73)		(29)
Net cash provided by (used for) financing activities		(7,232)		(7,619)		10,695		7,994		(655)		451		2,808		826

Effect of Exchange Rate Changes on Cash, Cash Equivalents, and Restricted Cash		24		(209)		7		(15)						31		(224)

Net Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash		1,974		(3,419)		705		235						2,679		(3,184)
Cash, Cash Equivalents, and Restricted Cash at Beginning of Year		3,781		7,200		1,160		925						4,941		8,125
Cash, Cash Equivalents, and Restricted Cash at End of Year	$	5,755	$	3,781	$	1,865	$	1,160					$	7,620	$	4,941

¹²	Elimination of depreciation on leases related to inventory transferred to equipment on operating leases.
¹³	Reclassification of share-based compensation expense.
¹⁴	Elimination of dividends from Financial Services to the Equipment Operations, which are included in the Equipment Operations operating activities.
¹⁵	Primarily reclassification of receivables related to the sale of equipment.
¹⁶	Reclassification of direct lease agreements with retail customers.
¹⁷	Reclassification of sales incentive accruals on receivables sold to Financial Services.
¹⁸	Elimination and reclassification of the effects of Financial Services partial financing of the construction and forestry retail locations sales and subsequent collection of those amounts.
¹⁹	Elimination of investment from Equipment Operations to Financial Services.

DEERE & COMPANY
OTHER FINANCIAL INFORMATION

The company evaluates its business results on the basis of accounting principles generally accepted in the United States. In addition, it uses a metric referred to as Shareholder Value Added (SVA), which management believes is an appropriate measure for the performance of its businesses. SVA is, in effect, the pretax profit left over after subtracting the cost of enterprise capital. The company is aiming for a sustained creation of SVA and is using this metric for various performance goals. Certain compensation is also determined on the basis of performance using this measure. For purposes of determining SVA, each of the equipment segments is assessed a pretax cost of assets, which on an annual basis is approximately 12 percent of the segment's average identifiable operating assets during the applicable period with inventory at standard cost. Management believes that valuing inventories at standard cost more closely approximates the current cost of inventory and the company's investment in the asset. The Financial Services segment is assessed an annual pretax cost of approximately 13 percent of the segment's average equity. The cost of assets or equity, as applicable, is deducted from the operating profit or added to the operating loss of each segment to determine the amount of SVA.


	Equipment						Production &						Small Ag						Construction
For the Years Ended	Operations						Precision Ag						& Turf						& Forestry
	Oct 29			Oct 30			Oct 29			Oct 30			Oct 29			Oct 30			Oct 29			Oct 30
Dollars in Millions	2023			2022			2023			2022			2023			2022			2023			2022
Net Sales	$	55,565		$	47,917		$	26,790		$	22,002		$	13,980		$	13,381		$	14,795		$	12,534
Average Identifiable Assets
With Inventories as Reported	$	21,114		$	19,420		$	9,256		$	8,336		$	4,601		$	4,349		$	7,257		$	6,735
With Inventories at Standard Cost		23,186			20,983			10,343			9,118			5,149			4,795			7,694			7,070
Operating Profit	$	12,163		$	8,349		$	6,996		$	4,386		$	2,472		$	1,949		$	2,695		$	2,014
Percent of Net Sales		21.9	%		17.4	%		26.1	%		19.9	%		17.7	%		14.6	%		18.2	%		16.1	%
Operating Return on Assets
With Inventories as Reported		57.6	%		43.0	%		75.6	%		52.6	%		53.7	%		44.8	%		37.1	%		29.9	%
With Inventories at Standard Cost		52.5	%		39.8	%		67.6	%		48.1	%		48.0	%		40.6	%		35.0	%		28.5	%
SVA Cost of Assets	$	(2,782)		$	(2,519)		$	(1,241)		$	(1,094)		$	(618)		$	(576)		$	(923)		$	(849)
SVA		9,381			5,830			5,755			3,292			1,854			1,373			1,772			1,165

	Financial
For the Years Ended	Services
	Oct 29			Oct 30
Dollars in Millions		2023			2022
Net Income Attributable to Deere & Company	$	619		$	880
Average Equity		6,588			5,725
Return on Equity		9.4	%		15.4	%
Operating Profit	$	795		$	1,159
Cost of Equity		(858)			(760)
SVA		(63)			399