CNH Industrial flags weak 2026 profit on sluggish farm machinery demand

Feb 17 (Reuters) – Global manufacturer of farm and construction equipment CNH Industrial on Tuesday forecast full-year profit below Wall Street estimates, as low crop prices, high input costs and shifting trade policies weigh on demand for agricultural machinery.

Shares of the company were down more than 4% in premarket trading.

The Basildon, UK-based company said it expects retail demand in 2026 to fall about 5% from 2025 levels and plans to keep production subdued as it works with dealers to bring down excess inventory across its network.

Farm equipment makers have scaled back factory output amid persistently weak demand for new machinery, as softer crop prices and rising costs prompt farmers to delay large purchases. That slowdown has left dealers carrying elevated stock, resulting in a more cautious approach to restocking.

CNH expects full-year adjusted profit to be between $0.35 and $0.45 per share, below analysts’ estimates of $0.54 per share, according to data compiled by LSEG.

Farmers in the U.S. are facing another season of low prices,  high costs and difficult decisions about how, or whether, to keep operating, as abundant grain supplies weigh on markets.

The U.S. Department of Agriculture earlier this month forecast net farm income, a broad measure of profitability in the agricultural economy, to fall 0.7% to $153.4 billion in 2026 from a year ago.

“Agricultural equipment industry demand is expected to resume growth in 2027,” CNH said.

The company, which makes Case IH and New Holland tractors, reported fourth-quarter revenue of $5.16 billion, beating analysts’ estimates of $4.61 billion.

On an adjusted basis, it reported a profit of 19 cents per share for the quarter ended December 31, compared with estimates of 10 cents per share.    

(Reporting by Abhinav Parmar in Bengaluru; Editing by Tasim Zahid)