About Joshua Jepsen
Joshua Jepsen, Senior Vice President and CFO of Deere, said in a February 2024 interview that the current agricultural cycle is "very different from what we've seen in the past" because farmer fundamentals remain strong, with balance sheets in "some of the best shape they've ever been in," strong land values, and low debt-to-equity. He noted that the company does not have "tremendous amounts of used inventory," making the setup for farmer and fleet fundamentals better than a decade ago. Regarding the construction segment, Jepsen said the full-year outlook became "incrementally a little bit stronger," citing infrastructure projects and some improvement in single-family homes, which benefited compact construction equipment.
Jepsen also discussed Deere's partnership with Starlink, calling it "a very big deal for our future." He stated that the company plans to roll out the service in the second half of 2024, focused on North America and South America, because nearly 70% of agricultural land in Brazil and almost 30% in the U.S. and Canada lacks cellular coverage. Jepsen described connectivity as "foundational" to enabling precision agriculture, automation, and autonomy, allowing machines to communicate via the cloud and farmers to operate remotely. He added that this supports Deere's strategy of offering "solutions as a service" with lower upfront costs and a pay-as-you-go model.
Source: AI-verified profile updated from Joshua Jepsen's recent appearances.
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Transcript (6 segments)
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Reporter0:12
Estimates, but it did cut its full-year profit forecast sales lower than the street expected, amid falling crop prices, high borrowing costs. But Deere's fiscal first quarter topped analyst expectations on the top and bottom line. I spoke exclusively with Deere's CFO, and I asked him where we are in this current agriculture cycle.
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Joshua Jepsen0:33
It's very different from what we've seen in the past, because the fundamentals for farmer financials are still really strong. Balance sheets are in some of the best shape they've ever been in. Land values are strong. Debt to equity is low. So I think the setup is very different than previous cycles. We don't have tremendous amounts of used inventory, so I think the setup for both farmer fundamentals is a little bit stronger in terms of the full-year outlook.
In infrastructure, which impacts our earth-moving and road-building equipment, what we're seeing on the manufacturing side, so the large projects that drive a tremendous amount of site prep. And then, you know, incrementally, some improvement on single family homes, which is beneficial, as well. And we've seen that benefit compact construction equipment, which is an end market that's been particularly strong for us.
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Reporter1:39
We also discussed agriculture and the role that Deere is betting its budding services market will provide, after linking a deal with Starlink.
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Joshua Jepsen2:11
Brazil, nearly 70% doesn't have cellular coverage, and even in the U.S. and Canada, almost 30% of ag land doesn't have connectivity. So, that's where we're starting, with an opportunity over time to move that across to other parts of the globe, which is significant. What does it unlock? Like I said before, connectivity is foundational, in terms of our ability to drive more precision ag automation tools and autonomy into our business. Allowing machines to communicate to one another and have real-time communication via the cloud, our digital data platform. It allows the farmer to run their operation from wherever they are, not necessarily having to be in the cab of a tractor, for example. Pay as you go model. And we see this...
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Reporter3:10
Pay as you go model. And we see this...
