Deere & Co ( DE ) shares are trading higher after the company reported third-quarter results and reaffirmed its net income 2024 outlook.

The company’s net sales and revenue declined 17% year-over-year to $13.152 billion, beating the consensus of $10.944 billion.

Production & Precision Agriculture net sales declined 25% Y/Y to $5.099 billion, Small Agriculture & Turf net sales fell 18% to $3.053 billion, and Construction & Forestry revenue declined 13% to $3.235 billion due to lower shipment volumes.

Financial services revenues grew 21% year over year to $1.489 billion, and net income declined to $153 million from $216 million a year ago due to a higher provision for credit losses and less favorable financing spreads.

According to CEO John C. May, John Deere’s third-quarter results highlight the company’s disciplined execution amid challenging conditions in the global agricultural and construction sectors.

Operating profit fell 34.7% Y/Y to $2.279 billion, and margin contracted by 480 bps to 17.5%.

Deere clocked an EPS of $6.29, down from $10.20 YoY, beating the consensus of $5.85.

Segment operating margins: Production & Precision Agriculture 22.8%, down YoY from 26.2%; Small Agriculture & Turf 16.2%, down YoY from 19.6%; Construction & Forestry 13.8%, down YoY from 19.1%.

Also Read: Deere Earnings Are Imminent; Here Are The Recent Forecast Changes From Wall Street’s Most Accurate Analysts

As of July 28, Deere held over $7 billion in cash and equivalents. DE’s net cash provided by operating activities for the nine months ended July 28 was $4.139 billion, compared to cash used of $2.896 billion a year ago.

During the quarter, the company initiated involuntary employee-separation programs across several regions, aiming to streamline operations. The programs incurred $124 million in pretax expenses, with an estimated total of $150 million.

2024 Guidance: Deere reaffirmed its 2024 net income outlook of $7.00 billion.

“In response to weak market conditions, we have taken steps to reduce costs and strategically align our production with customer needs,” mentioned May.

Deere expects 2024 Production & Precision Ag net sales to decline by ~20% -25% and price realization of +2%; Small Ag & Turf net sales to fall by 20%- 25% and price realization of +2%; and Construction & Forestry net sales to decrease by 10%- 15% and price realization of +0.5%.

The company expects Financial services net income of $720 million for the fiscal.

Price Action: DE shares traded higher by 1.15% at $355.31 premarket at the last check Thursday.