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✦ The Future BetsNarrow moat

Deere & Company (DE) — the future bets

Deere's future bets are a called bottom, a push to charge for technology as a service, a mixed-fleet software purchase and a construction upturn, all funded from cash.

Deere's bets for the next few years are mostly bets on the cycle and on technology finally earning separately. Net income for fiscal 2026 is guided at $4.75 billion to $5.00 billion1, and management calls 2026 the bottom of the agricultural equipment cycle2.

Deere fiscal 2026 guidance for segment net sales change (%)-10Production & Precision Ag+15Small Ag & Turf+20Construction & ForestryDeere Q3 FY2026 release, segment outlook; approximate
The growth this year is outside large farming.

Four pages follow them. Calling the Bottom is the forecast that the farm downturn ends this year. Solutions as a Service is the strategy of charging for technology over time. Tenna and the Mixed Fleet is a $439 million purchase aimed at contractors' whole fleets3. Construction's Turn is the segment growing fastest right now.

The precision technology already in Deere's machines, See & Spray and the Operations Center, is argued under Precision Technology, because it is part of the defence rather than an option.

The bets have one thing in common: none of them requires Deere to build new factories or borrow heavily. Capital spending is estimated at about $1.3 billion for fiscal 20264, and the equipment operations are expected to generate $5 billion to $5.5 billion of operating cash flow5. Deere is betting with its engineering budget and its balance sheet's patience, not with new debt.

The bets are being funded at a cautious pace. Equipment operations are expected to generate $5 billion to $5.5 billion of operating cash in fiscal 20266 against about $1.3 billion of capital spending7, and $7.2 billion of the share repurchase plan remained at the end of the third quarter8.

The bets are narrow and widening. None of the four bets yet has a revenue line of its own; the first one to appear as a number in a 10-K will be the first that can be held to account.

Moat trajectory: Widening

Guidance raised to $4.75-5.00bn in August.

The number that tests this moat
Reported
Fiscal 2026 net income guidance
$4.75bn-$5.00bn (August 2026), from $4.00bn-$4.75bn in November 2025

The nearest test of the bets; a result below $4.75bn would mean the bottom has not passed.

Source: Deere & Company Q3 FY2026 results release ↗
✦ Future bets — beyond today's moat
✦ FUTURE BET 01
Calling the Bottom
Deere says 2026 is the bottom of the farm cycle and raised guidance to $4.75-5.00 billion, still slightly below fiscal 2025.
✦ FUTURE BET 02
Solutions as a Service
Deere's 2030 ambitions emphasise Solutions as a Service, but its own filings say SaaS revenue is not yet a significant share and adoption has been…
✦ FUTURE BET 03
Tenna and the Mixed Fleet
Deere paid $439 million, two-thirds of it goodwill, for Tenna, software that tracks every brand on a construction site, including its rivals'.
✦ FUTURE BET 04
Construction's Turn
Deere's construction business is guided up about 20% in fiscal 2026 on data centres, pipelines and infrastructure, with backlogs into fiscal 2027.
References
  1. ReportedNet income for fiscal 2026 is guided at $4.75 billion to $5.00 billion, and management calls 2026 the bottom of the agricultural equipment cycle.
    Deere & Company third-quarter fiscal 2026 results release, Form 8-K exhibit 99.1 - net income, segment results, the industry and segment outlook for fiscal 2026 and net income guidance of $4.75-5.00 billion. — Q3 FY2026 · publ. 20 August 2026 · source ↗
  2. ReportedNet income for fiscal 2026 is guided at $4.75 billion to $5.00 billion, and management calls 2026 the bottom of the agricultural equipment cycle.
    Deere & Company third-quarter fiscal 2026 results release, Form 8-K exhibit 99.1 - net income, segment results, the industry and segment outlook for fiscal 2026 and net income guidance of $4.75-5.00 billion. — Q3 FY2026 · publ. 20 August 2026 · source ↗
  3. ReportedTenna and the Mixed Fleet is a $439 million purchase aimed at contractors' whole fleets.
    Deere & Company Form 10-Q for the quarter ended 2 August 2026, $ millions - segment results for the quarter and nine months, price realization and the Tenna acquisition. — Q3 FY2026 · publ. 27 August 2026 · source ↗
  4. ReportedCapital spending is estimated at about $1.3 billion for fiscal 2026, and the equipment operations are expected to generate $5 billion to $5.5 billion of operating cash flow.
    Deere & Company Form 10-Q for the quarter ended 2 August 2026, $ millions - income statement, balance sheet, receivables, financing receivables, cash returned and the outlook. — Q3 FY2026 · publ. 27 August 2026 · source ↗
  5. ReportedCapital spending is estimated at about $1.3 billion for fiscal 2026, and the equipment operations are expected to generate $5 billion to $5.5 billion of operating cash flow.
    Deere & Company third-quarter fiscal 2026 earnings call, FactSet corrected transcript - engaged and highly engaged acres, See & Spray adoption, early order programs, construction backlogs, tariffs, equipment cash flow guidance and the FTC settlement - outlook, early order programs, construction backlogs, tariffs, cash flow and the FTC settlement. — Q3 FY2026 · publ. 20 August 2026 · source ↗
  6. ReportedEquipment operations are expected to generate $5 billion to $5.5 billion of operating cash in fiscal 2026 against about $1.3 billion of capital spending, and $7.2 billion of the share repurchase plan remained at the end of the third quarter.
    Deere & Company third-quarter fiscal 2026 earnings call, FactSet corrected transcript - engaged and highly engaged acres, See & Spray adoption, early order programs, construction backlogs, tariffs, equipment cash flow guidance and the FTC settlement - outlook, early order programs, construction backlogs, tariffs, cash flow and the FTC settlement. — Q3 FY2026 · publ. 20 August 2026 · source ↗
  7. ReportedEquipment operations are expected to generate $5 billion to $5.5 billion of operating cash in fiscal 2026 against about $1.3 billion of capital spending, and $7.2 billion of the share repurchase plan remained at the end of the third quarter.
    Deere & Company Form 10-Q for the quarter ended 2 August 2026, $ millions - income statement, balance sheet, receivables, financing receivables, cash returned and the outlook. — Q3 FY2026 · publ. 27 August 2026 · source ↗
  8. ReportedEquipment operations are expected to generate $5 billion to $5.5 billion of operating cash in fiscal 2026 against about $1.3 billion of capital spending, and $7.2 billion of the share repurchase plan remained at the end of the third quarter.
    Deere & Company Form 10-Q for the quarter ended 2 August 2026, $ millions - income statement, balance sheet, receivables, financing receivables, cash returned and the outlook. — Q3 FY2026 · publ. 27 August 2026 · source ↗
Sources
Generated October 5, 2026