Thu, May 29, 6:05 PM (25 days ago)
**John Deere Capital Corporation (JDCC) Q2 2025 Financial Summary** **Financial Health and Performance:** - **Revenue:** $1,190.4 million (Q2 2025) vs. $1,199.5 million (Q2 2024), showing a slight decline. - **Net Income:** $124.0 million (Q2 2025) vs. $126.5 million (Q2 2024), reflecting a 2% decrease. - **Profit Margins:** Net margin slightly decreased due to higher provision for credit losses and less favorable financing spreads, partially offset by lower administrative and operating expenses. - **Cash Flow:** Net cash provided by operating activities increased to $1,142.9 million (H1 2025) from $815.6 million (H1 2024). **Key Metrics and Trends:** - **Revenue Breakdown:** Finance income from retail notes increased by 9%, while wholesale receivables decreased by 23%. - **Expenses:** Interest expense increased by 1%, and the provision for credit losses rose by 13% due to higher credit losses on agricultural and turf customer accounts. - **Receivables and Leases:** Total receivables and leases decreased by 12% in Q2 2025, driven by lower agriculture and turf retail notes and a seasonal decline in revolving charge account receivables. - **Credit Quality:** Receivables 30 days or more past due increased to 1.29% of the receivables balance, and non-performing receivables rose to 1.36%. **Uncertainties and Future Operations:** - **Economic Conditions:** Elevated delinquencies and a decline in market conditions have led to higher expected losses on agricultural and turf customer accounts. - **Global Trade Policies:** New tariffs and retaliatory measures create uncertainty in the agriculture and construction industries. - **Interest Rates:** Elevated interest rates impact demand for John Deere’s products and financing spreads. - **Future Outlook:** Net income for fiscal year 2025 is expected to be higher than fiscal year 2024, primarily due to lower administrative and operating expenses, partially offset by less favorable financing spreads. **Capital Resources and Liquidity:** - **Liquidity Sources:** Cash and cash equivalents, commercial paper, term debt, securitization of retail notes, intercompany loans from John Deere, and bank lines of credit. - **Debt Ratings:** Senior long-term and short-term debt ratings remain stable, closely related to the outlook for John Deere. **Forward-Looking Statements:** - **Risks:** Factors such as global trade policies, interest rates, economic conditions, and regulatory changes could impact financial results. - **Strategies:** Focus on integrating technology, managing credit risk, and maintaining liquidity to support future operations. **Ticker:** JDCC