World’s Top Tractor Maker Slashes Outlook, Trims Jobs In Response To Slowing Sales 

CNH Industrial, a global leader in farm equipment with top brands such as Case, New Holland, and Steyr, saw its stock prices tumble on Tuesday – the largest intraday drop since June 2020. The decline followed the company’s decision to cut its revenue outlook for 2023, attributing the downward revision to a global deceleration of agricultural machinery demand. Also, the company announced an immediate restructuring program that will result in a cut of 5% of its salaried workforce. 

A quick look at the Italian-American company’s yearly forecast reveals net revenue forecast from industrial activities will be between 3-6% this year, down from a previous forecast of 8-11%. It also revised its free-cash-flow estimate lower to be between $1-1.2 billion from $1.3-$1.5 billion. 


  • Sees industrial net sales +3% to +6%, saw +8% to +11% 

  • Sees industrial free cash flow $1 billion to $1.2 billion, saw $1.3 billion to $1.5 billion

Sales for the third quarter fell 1% to $5.33 billion, below Bloomberg’s estimate of $5.8 billion. 


  • Adjusted EPS 42c, estimate 43c (Bloomberg Consensus)

  • Industrial net sales $5.33 billion, estimate $5.8 billion

  • Industrial Sales Constant Currency -3%

  • Agriculture net sales $4.38 billion, estimate $4.77 billion

  • Construction net sales $948 million, estimate $975.9 million

  • Agriculture Adj. Ebit $672 million, estimate $708.8 million

  • Construction adj. Ebit $60 million, estimate $49.3 million

  •  Agriculture adj. Ebit margin 15.3%, estimate 14.8%

  • Construction adj. Ebit margin 6.3%, estimate 5.04%

The decline in sales is primarily due to falling tractor demand across South America and Europe: 

In North America, industry volume was up 19% year over year in the third quarter for tractors over 140 HP and was down 7% for tractors under 140 HP; combines were down 4% from prior year. In EMEA, tractor and combine demand was up 4% and down 18%, respectively. Industry volume in Europe alone was down 7% for tractors and down 40% for combines. South America tractor demand was down 16% and combine demand was down 47%. Asia Pacific tractor demand was down 10% and combine demand was up 33%.

As a result of the slowdown, the company announced an “immediate restructuring program targeting a 5% reduction in salaried workforce cost” and will be “coupled with a comprehensive rightsizing of the Company’s cost structure to be implemented early next year.” 

Shares in Milan were repeatedly halted, while shares in the US fell 12%. 

The news follows Caterpillar’s earnings seven days ago, where it warned about a more cautious fourth quarter and said order backlogs fell

A softening in worldwide tractor sales could serve as a harbinger for a global slowdown, signaling growing economic turbulence due to the Federal Reserve’s aggressive monetary tightening. 


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