AGCO Corp. (NYSE:AGCO) on Thursday posted a fourth-quarter earnings beat and issued an upbeat 2026 outlook, signaling resilience despite softer underlying demand as currency tailwinds, margin discipline and record free cash flow helped offset a prolonged global farm equipment slowdown.
“2025 reflects a meaningful progress year that we’ve made in transferring AGCO into a more resilient, better-positioned company. We’re executing with discipline and focus on what we can control in a pretty volatile market,” Eric Hansotia, AGCO’s Chairman, President, and CEO, said in the earnings call.
Fourth Quarter Results
AGCO reported fourth-quarter 2025 net sales of $2.92 billion, a 1.1% increase from the prior year and above the $2.67 billion analyst estimate. Excluding a 6.4% favorable currency impact, net sales declined 5.3% year over year.
Reported net income for the quarter was $1.30 per share. Adjusted earnings were $2.17 per share, exceeding the $1.86 analyst estimate and up from $1.97 per share in the fourth quarter of 2024.
The company reported a 7.9% operating margin and a 10.1% adjusted operating margin, versus (9.3)% and 9.9% a year earlier.
In Europe and the Middle East, net sales rose 7.9% to $2.02 billion, with an operating margin of 16.8%. North America net sales declined 7.8% to $466 million, with an operating margin of (6.4)%.
South America net sales fell 3.3% to $259.9 million, with a 2.7% operating margin. Asia, Pacific, and Africa net sales increased 5.1% to $176.8 million, with a 7.6% operating margin.
Full-Year Results
For the full year 2025, AGCO reported net sales of $10.1 billion, a 13.5% decrease from 2024. Excluding a 2.3% favorable currency impact, net sales declined 15.8%.
Reported earnings were $9.75 per share, while adjusted earnings were $5.28 per share, compared to a net loss of $(5.69) per share and adjusted earnings of $7.50 per share in 2024. The full-year reported operating margin was 5.9%, with an adjusted operating margin of 7.7%.
The company attributed these results to lower industry demand in major markets, including significant declines in tractor and combine sales in North America, Brazil, and Western Europe.
Operating cash flow for 2025 was $988.1 million. Free cash flow reached a record $740.2 million, with a free cash flow conversion rate of 188.3%.
Cash and cash equivalents increased to $861.8 million at year-end. Borrowings due within one year declined to $117.7 million, and long-term debt totaled $2.32 billion.
“In 2026, we will remain dedicated to advancing our Farmer‑First strategy. Our innovation pipeline remains robust with a full slate of new product introductions designed to help make farmers more productive and profitable. This level of innovation, coupled with our ongoing cost‑reduction initiatives, demonstrates the strength of our execution. These actions will help balance the effects of low levels of farm profitability and persistent trade‑related uncertainty, while positioning the company to deliver improved performance in 2026,” said Hansotia, in a statement.
Outlook
For fiscal 2026, AGCO forecasts adjusted earnings per share of $5.50 to $6.00, compared to the analyst estimate of $5.83. The company projects net sales of $10.4 billion to $10.7 billion, above the $10.072 billion estimate.
The outlook includes tariffs in effect as of February 5, 2026, and related mitigation strategies. AGCO noted that changes to tariff policies could affect results.
On the earnings call, the CEO struck an optimistic tone on the company’s medium-term prospects, saying the 2026 outlook reflects confidence in sustaining earnings while deepening relationships with farmers and OEMs, transforming the dealer network, and gaining market share through higher-margin growth initiatives and structural cost actions.
Management described 2025 as the cyclical trough, noting that aging fleets across key markets should support a recovery in demand, leaving the company well positioned for a brighter outlook as conditions improve.
AGCO Price Action: Agco shares were down 0.46% at $121.11 at the time of publication on Thursday. The stock is trading near its 52-week high of $122.00, according to Benzinga Pro data.
Photo by T. Schneider via Shutterstock
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