AGCO REPORTS SECOND-QUARTER RESULTS
Net sales of $2.6 billion, down 18.8% year-over-year
Reported earnings per share of $4.22 and adjusted earnings per share(1) of $1.35
Strong year-to-date free cash flow generation
Full-year net sales and adjusted earnings per share outlook raised
DULUTH, Ga., July 31, 2025 /PRNewswire/ -- AGCO (NYSE:AGCO), a global leader in the design, manufacture and distribution of agricultural machinery and precision ag technology, reported net sales of $2.6 billion for the second quarter ended June 30, 2025, a decrease of 18.8% compared to the second quarter of 2024. The second quarter of 2024 included other revenue of $290.5 million which represents revenue from the Company's divestiture of the majority of its Grain & Protein business as shown in the regional net sales table. Reported net income was $4.22 per share for the quarter and adjusted net income(1) was $1.35 per share. These results compare to reported net loss of $(4.92) per share and adjusted net income(1) of $2.53 per share for the second quarter of 2024. Excluding favorable foreign currency translation of 3.5%, net sales in the quarter decreased 22.3% compared to the second quarter of 2024.
"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, 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."
Hansotia continued, "The global trade landscape has become increasingly complex, with uncertainty surrounding trade negotiations impacting farmer confidence and investment decisions, particularly in North America and Europe. AGCO is closely monitoring these developments and remains focused on operational agility, supply chain resilience and executing our Farmer-First strategy."
Net sales for the first six months of 2025 were approximately $4.7 billion which is a decrease of 24.1% compared to the same period in 2024. The first six months of 2024 included other revenue of $490.6 million which represents revenue from the Company's divestiture of the majority of its Grain & Protein business as shown in the regional net sales table. For the first six months of 2025, reported net income was $4.36 per share and adjusted net income(1) was $1.76 per share. These results compare to reported net loss of $(2.67) per share and adjusted net income(1) of $4.85 per share for the same period in 2024. Excluding favorable foreign currency translation of 0.7%, net sales in the first six months of 2025 decreased 24.8% compared to the same period in 2024.
Second Quarter Highlights
Reported regional sales results(2): Europe/Middle East ("EME") (5.1)%, North America (32.9)%, South America (4.0)%, Asia/Pacific/Africa ("APA") (5.4)%
Constant currency regional sales results(1)(2)(3): EME (11.2)%, North America (32.2)%, South America (4.7)%, APA (5.9)%
Regional operating margin performance: EME 14.7%, North America (5.3)%, South America 7.8%, APA 6.9%
On July 9, 2025, AGCO's Board of Directors authorized a new share repurchase program authorizing the Company to repurchase up to $1.0 billion of the Company's common stock
(1) See reconciliation of non-GAAP measures in appendix.(2) As compared to second quarter 2024.(3) Excludes currency translation impact.
Market Update
Industry Unit Retail Sales
Tractors
Combines
Six Months Ended June 30, 2025
Change from
Prior Year Period
Change from
Prior Year Period
North America(4)
(13) %
(33) %
Brazil(5)
6 %
(9) %
Western Europe(5)
(12) %
(8) %
(4) Excludes compact tractors.(5) Based on Company estimates.
Hansotia concluded, "Challenging farm economics in the first half of 2025 have dampened demand for agricultural equipment across Europe and the U.S., with declining commodity prices and rising input costs specifically impacting U.S. farmer sentiment. Instead, there is growing interest in precision agriculture tools that offer efficiency gains without significant capital investment. In Brazil, erratic weather and lower prices have made farmers more cautious, with many choosing to maintain existing equipment rather than invest in new high-horsepower machinery. In Europe, environmental regulations and weather-related disruptions are driving demand for sustainable and adaptive technologies. While traditional equipment sales remain under pressure, we are seeing a clear shift toward smarter, more efficient solutions as farmers work to protect margins and navigate ongoing volatility."
North American industry retail tractor sales declined 13% in the first half of 2025 compared to the same period in 2024 with the steepest drops occurring in higher horsepower categories, particularly in recent months. Combine unit sales fell 33% year-over-year during the same period. Ongoing uncertainty around grain export demand and elevated input costs are expected to continue weighing on industry demand throughout 2025, especially for larger equipment.
Brazil industry retail tractor sales rose 6% in the first half of 2025 compared to the same period in 2024, driven primarily by demand for smaller tractors. Despite record soybean harvests and potential trade benefits, demand for larger equipment has yet to show meaningful improvement. If trade conditions continue to strengthen farm economics, demand could pick up later in the year. For now, industry growth in Brazil is expected to remain modest.
Western Europe industry retail tractor sales declined 12% during the first six months of 2025 compared to the same period in 2024 with double digit percentage decreases across most markets except Spain and Italy, which both saw modest growth. Demand is expected to remain soft throughout the year, as lower income levels weigh on arable farmers. However, steady demand from dairy and livestock producers is expected to partially offset the overall decline.
Regional Results
AGCO Regional Net Sales (in millions)
Three Months Ended June 30,
2025
2024
% change from 2024
% change from 2024 due to currency translation(6)
% change excluding currency translation
North America
$ 420.9
$ 627.2
(32.9) %
(0.7) %
(32.2) %
South America
303.4
315.9
(4.0) %
0.7 %
(4.7) %
EME
1,774.9
1,869.5
(5.1) %
6.1 %
(11.2) %
APA
135.8
143.5
(5.4) %
0.5 %
(5.9) %
Total Segments
2,635.0
2,956.1
(10.9) %
3.8 %
(14.7) %
Other(7)
—
290.5
(100.0) %
— %
(100.0) %
$ 2,635.0
$ 3,246.6
(18.8) %
3.5 %
(22.3) %
Six Months Ended June 30,
2025
2024
% change from 2024
% change from 2024 due to currency translation(6)
% change from 2024 due to acquisition of a business(6)
% change excluding currency translation and acquisition of a business
North America
$ 816.5
$ 1,228.3
(33.5) %
(1.1) %
0.6 %
(33.0) %
South America
533.3
588.9
(9.4) %
(5.0) %
0.9 %
(5.3) %
EME
3,105.4
3,576.4
(13.2) %
2.5 %
1.1 %
(16.8) %
APA
230.3
291.1
(20.9) %
(0.7) %
2.0 %
(22.2) %
Total Segments
4,685.5
5,684.7
(17.6) %
0.8 %
1.0 %
(19.4) %
Other(7)
—
490.6
(100.0) %
— %
— %
(100.0) %
$ 4,685.5
$ 6,175.3
(24.1) %
0.7 %
1.0 %
(25.8) %
(6) See footnotes for additional disclosures.
(7) "Other" represents the results for the three and six months ended June 30, 2024 for the majority of the Company's Grain & Protein ("G&P") business which was divested on November 1, 2024. The results of the G&P business through the date of the divestiture were previously included within our North America, South America, Europe/Middle East and Asia/Pacific/Africa segments.
North America
North American net sales decreased 32.2% during the second quarter of 2025 compared to the second quarter of 2024, excluding the impact of unfavorable currency translation. Softer industry sales and under-production of end-market demand contributed to lower sales. The most significant sales declines occurred in high-horsepower tractors, sprayers and hay equipment. Income from operations for the second quarter of 2025 decreased $58.3 million compared to the same period in 2024 and operating margins were (5.3)%. The decrease was primarily a result of lower sales and production volumes.
South America
Net sales in the South American region decreased 4.7% during the second quarter of 2025 compared to the second quarter of 2024, excluding the impact of favorable currency translation. Dealer inventory de-stocking drove most of the decrease. Lower sales of mid-range tractors, planters and sprayers accounted for most of the decline. Income from operations for the second quarter of 2025 increased $17.4 million compared to the same period in 2024. This increase was primarily a result of improved product mix and improved factory efficiency, partially offset by negative pricing impacts.
Europe/Middle East
Europe/Middle East region net sales decreased 11.2% during the second quarter of 2025 compared to the second quarter of 2024, excluding the impact of favorable currency translation. Lower sales across most of the Western European markets were partially offset by growth in Eastern Europe and Scandinavia. Declines were largest in high-horsepower tractors and combines. Income from operations decreased $34.3 million in the second quarter of 2025 compared to the same period in 2024. This decrease was primarily a result of lower sales and production volumes as well as higher warranty costs.
Asia/Pacific/Africa
Net sales in the Asia/Pacific/Africa region decreased 5.9%, excluding favorable currency translation impacts, during the second quarter of 2025 compared to the second quarter of 2024 due to weaker end market demand and lower production volumes. Lower sales in Australia, China and Japan drove most of the decline. Income from operations decreased $1.0 million in the second quarter of 2025 compared to the same period in 2024 primarily due to lower sales and production volumes.
Outlook
AGCO now expects full-year 2025 net sales of approximately $9.8 billion. Adjusted operating margins are projected to be approximately 7.5%. Lower production volumes are expected to be partially offset by cost controls and stable engineering expenses. Based on these assumptions, full-year earnings per share are now targeted between $4.75 and $5.00. These estimates incorporate the expected impact of tariffs in effect as of July 31, 2025, along with AGCO's mitigation strategies. Any changes to tariff policies or related responses could affect these projections.
* * * * *
AGCO will host a conference call with respect to this earnings announcement at 10 a.m. Eastern Time on Thursday, July 31. The Company will refer to slides on its conference call. Interested persons can access the conference call and slide presentation via AGCO's website at www.agcocorp.com under the "Investors" Section. A replay of the conference call will be available approximately two hours after the conclusion of the conference call for 12 months following the call. A copy of this press release will be available on AGCO's website for at least 12 months following the call.
* * * * *
Safe Harbor Statement
Statements that are not historical facts, including the projections of earnings per share, production levels, sales, industry demand, market conditions, commodity prices, currency translation, farm income levels, margin levels, strategy, investments in product and technology development, new product introductions, restructuring and other cost reduction initiatives, production volumes, tax rates and general economic conditions, are forward-looking and subject to risks that could cause actual results to differ materially from those suggested by the statements. The following are among the factors that could cause actual results to differ materially from the results discussed in or implied by the forward-looking statements.
Our financial results depend entirely upon the agricultural industry, and factors that adversely affect the agricultural industry generally, including declines in the general economy, adverse weather, tariffs, increases in farm input costs, lower commodity prices, lower farm income and changes in the availability of credit for our retail customers, will adversely affect us.
We maintain an independent dealer and distribution network in the markets where we sell products. The financial and operational capabilities of our dealers and distributors are critical to our ability to compete in these markets. Higher inventory levels at our dealers and high utilization of dealer credit limits as well as the financial health of our dealers could negatively impact future sales and adversely impact our performance.
On April 1, 2024, we completed the acquisition of the ag assets and technologies of Trimble through the formation of a joint venture, PTx Trimble, of which we own 85%. Financing the PTx Trimble transaction significantly increased our indebtedness and interest expense. We also have made various assumptions relating to the acquisition that may not prove to be correct, and we may fail to realize all of the anticipated benefits of the acquisition. All acquisitions involve risk, and there is no certainty that the acquired business will operate as expected. Each of these items, as well as similar acquisition-related items, would adversely impact our performance.
A majority of our sales and manufacturing takes place outside the United States, and many of our sales involve products that are manufactured in one country and sold in a different country. As a result, we are exposed to risks related to foreign laws, taxes and tariffs, trade restrictions, economic conditions, labor supply and relations, political conditions and governmental policies. The recent announcements of significant trade policy and tariff actions by the U.S. government, including but not limited to tariffs on imported steel and aluminum products, multiple tariffs on certain imports from China, tariffs on certain imports from Canada and Mexico, announced trade deal between the United States and European Union of baseline tariffs on certain imports from the European Union, and baseline tariffs on most imports from most other countries, are creating significant uncertainty and potential risks for our business. These announcements in some cases were followed by delays and changes in implementation, and the ultimate tariff structures are unclear at the current time. Depending upon which countries are impacted, increases in tariffs can increase both the costs of the inputs that we use in manufacturing products and increase the after-tariff sales prices of the products that we sell. The impacts of the tariffs may be partially mitigated as a majority of our sales and manufacturing takes place outside the United States. Additionally, these tariffs will increase the cost of certain raw materials and components, impacting our cost of goods sold. While we are actively exploring opportunities to mitigate these increased costs, there can be no guarantee that we will be able to fully offset the impact of these tariffs. Furthermore, the imposition of retaliatory tariffs from other countries on our exported products could negatively affect our sales and marketplace access in those countries. Moreover, the uncertainty of the tariff changes and any future trade policy changes has adversely impacted, and is expected to continue to adversely impact, our sales.
We cannot predict or control the impact of the conflict in Ukraine on our business. Already it has resulted in reduced sales in Ukraine as farmers have experienced economic distress, difficulties in harvesting and delivering their products, as well as general uncertainty. There is a potential for natural gas shortages, as well as shortages in other energy sources, throughout Europe, which could negatively impact our production in Europe both directly and through interrupting the supply of parts and components that we use. It is unclear how long these conditions will continue, or whether they will worsen, and what the ultimate impact on our performance will be. In addition, AGCO sells products in, and purchases parts and components from, other regions where there could be hostilities. Any hostilities likely would adversely impact our performance.
Most retail sales of the products that we manufacture are financed, either by our joint ventures with Rabobank or by a bank or other private lender. Our joint ventures with Rabobank, which are controlled by Rabobank and are dependent upon Rabobank for financing as well, finance approximately 50% of the retail sales of our tractors and combines in the markets where the joint ventures operate. Any difficulty by Rabobank to continue to provide that financing, or any business decision by Rabobank as the controlling member not to fund the business or particular aspects of it (for example, a particular country or region), would require the joint ventures to find other sources of financing (which may be difficult to obtain), or us to find another source of retail financing for our customers, or our customers would be required to utilize other retail financing providers. As a result of the recent economic downturn, financing for capital equipment purchases generally has become more difficult in certain regions and in some cases, can be expensive to obtain. To the extent that financing is not available or available only at unattractive prices, our sales would be negatively impacted. In addition, Rabobank also is the lead lender in our revolving credit facility and term loans and for many years has been an important financing partner for us. Any interruption or other challenges in that relationship would require us to obtain alternative financing, which could be difficult.
Both AGCO and our finance joint ventures have substantial accounts receivable from dealers and end customers, and we would be adversely impacted if the collectability of these receivables was less than optimal; this collectability is dependent upon the financial strength of the farm industry, which in turn is dependent upon the general economy and commodity prices, as well as several of the other factors listed in this section.
We have experienced substantial and sustained volatility with respect to currency exchange rate and interest rate changes, which can adversely affect our reported results of operations and the competitiveness of our products.
Our success depends on the introduction of new products, particularly engines that comply with emission requirements and sustainable smart farming technology, which require substantial expenditures; there is no certainty that we can develop the necessary technology or that the technology that we develop will be attractive to farmers or available at competitive prices.
Our expansion plans in emerging markets, including establishing a greater manufacturing and marketing presence and growing our use of component suppliers, could entail significant risks.
Our business increasingly is subject to regulations relating to privacy and data protection, and if we violate any of those regulations, or otherwise are the victim of a cyberattack, we could be subject to significant claims, penalties and damages.
Cybersecurity breaches including ransomware attacks and other means are rapidly increasing. We continue to review and improve our safeguards to minimize our exposure to future attacks. However, there always will be the potential of the risk that a cyberattack will be successful and will disrupt our business, either through shutting down our operations, destroying data, exfiltrating data or otherwise.
We depend on suppliers for components, parts and raw materials for our products, and any failure by our suppliers to provide products as needed, or by us to promptly address supplier issues, will adversely impact our ability to timely and efficiently manufacture and sell products. In addition, the potential of future natural gas shortages in Europe, as well as predicted overall shortages in other energy sources, could also negatively impact our production and that of our supply chain in the future. There can be no assurance that there will not be future disruptions.
Any future pandemics could negatively impact our business through reduced sales, facilities closures, higher absentee rates, and reduced production at both our plants and the plants that supply us with parts and components. In addition, logistical and transportation-related issues and similar problems may also arise.
We recently have experienced significant inflation in a range of costs, including for parts and components, shipping, and energy. While we have been able to pass along most of those costs through increased prices, there can be no assurance that we will be able to continue to do so. If we are not, it will adversely impact our performance.
We face significant competition, and if we are unable to compete successfully against other agricultural equipment manufacturers, we would lose customers and our net sales and performance would decline.
We have a substantial amount of indebtedness (and have incurred additional indebtedness as part of the PTx Trimble joint venture transaction), and, as a result, we are subject to certain restrictive covenants and payment obligations, as well as increased leverage generally, that may adversely affect our ability to operate and expand our business.
Further information concerning these and other factors is included in AGCO's filings with the Securities and Exchange Commission, including its Form 10-K for the year ended December 31, 2024, and subsequent Form 10-Qs. AGCO disclaims any obligation to update any forward-looking statements except as required by law.
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About AGCO
AGCO (NYSE:AGCO) is a global leader in the design, manufacture and distribution of agricultural machinery and precision ag technology. AGCO delivers value to farmers and OEM customers through its differentiated brand portfolio including leading brands Fendt®, Massey Ferguson®, PTx and Valtra®. AGCO's full line of equipment, smart farming solutions and services helps farmers sustainably feed our world. Founded in 1990 and headquartered in Duluth, Georgia, USA, AGCO had net sales of approximately $11.7 billion in 2024. For more information, visit www.agcocorp.com.
AGCO CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited and in millions)
June 30, 2025
December 31, 2024
ASSETS
Current Assets:
Cash and cash equivalents
$ 783.9
$ 612.7
Accounts and notes receivable, net
1,205.7
1,267.4
Inventories, net
3,096.4
2,731.3
Other current assets
542.3
526.6
Total current assets
5,628.3
5,138.0
Property, plant and equipment, net
1,966.0
1,818.6
Right-of-use lease assets
179.7
168.9
Investments in affiliates
594.2
519.6
Deferred tax assets
828.4
561.0
Other assets
501.6
435.2
Intangible assets, net
712.9
728.9
Goodwill
1,898.7
1,820.4
Total assets
$ 12,309.8
$ 11,190.6
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND STOCKHOLDERS' EQUITY
Current Liabilities:
Borrowings due within one year
$ 207.9
$ 415.2
Accounts payable
1,060.0
813.0
Accrued expenses
2,409.0
2,469.6
Other current liabilities
126.6
128.2
Total current liabilities
3,803.5
3,826.0
Long-term debt, less current portion and debt issuance costs
2,756.9
2,233.3
Operating lease liabilities
132.6
127.5
Pension and postretirement health care benefits
163.0
155.6
Deferred tax liabilities
139.5
125.0
Other noncurrent liabilities
841.5
680.3
Total liabilities
7,837.0
7,147.7
Redeemable noncontrolling interests
304.3
300.1
Stockholders' Equity:
Preferred stock
—
—
Common stock
0.7
0.7
Additional paid-in capital
10.0
—
Retained earnings
5,922.6
5,645.0
Accumulated other comprehensive loss
(1,764.8)
(1,902.9)
Total stockholders' equity
4,168.5
3,742.8
Total liabilities, redeemable noncontrolling interests and stockholders' ...
