John Deere's Construction Segment: A 27% Quarter After a Rough Year — What It Means for Equipment Financing Now

A Quarter That Looked Nothing Like the Year Before It

If you make a living running a dozer, a skid steer, or an excavator with a green paint job, you probably felt the construction equipment market tighten up over the last couple of years before you ever saw a headline about it. Rental yards got more aggressive with used inventory. Dealers sat on more iron than usual. New-machine lead times, which had stretched out during the supply crunch, suddenly got short again, and short lead times on a dealer lot usually mean one thing: demand had cooled.

Deere's own fourth-quarter fiscal 2025 numbers, filed with the Securities and Exchange Commission and reported in the company's own press release, confirm what a lot of contractors were sensing on the ground. For the full fiscal year, Deere's Construction & Forestry segment posted net sales of $11.382 billion, down 12% from $12.956 billion the year before. That's a real, meaningful pullback, not a rounding error.

Then the Fourth Quarter Flipped the Script

Here's the part that actually matters for anyone thinking about financing equipment right now. In the fourth fiscal quarter alone, Construction & Forestry net sales jumped to $3.382 billion, up 27% from $2.664 billion in the same quarter a year earlier. Deere's own commentary attributes the jump to higher shipment volumes, not a one-time accounting change or a currency swing. Machines moved. Dealers took delivery. That's a demand signal, not a paper gain.

For the company as a whole, Deere reported net income of $1.065 billion for the fourth quarter and $5.027 billion for the full fiscal year. A single strong quarter doesn't erase a full year that finished down, and Deere's own numbers don't pretend otherwise. What it does tell you is that the second half of calendar 2025 saw real, verified order and shipment activity pick back up in construction equipment specifically, after a stretch where the segment had clearly been softer than the year before.

Why a Shipment-Volume Jump Is Different From a Price Increase

It's worth sitting with that distinction for a second, because it changes what the number means for you. A manufacturer can grow sales by raising prices on the same number of machines, and that tells a contractor nothing good. Deere's filing specifically calls out higher shipment volumes as the driver of the fourth-quarter jump. More machines physically left the factory and landed on dealer lots and jobsites. That's the kind of number that shows up as shorter waitlists on the model you actually want, not just a bigger invoice.

What a Rebound Quarter Usually Does to Dealer Inventory and Pricing

A manufacturer doesn't ship 27% more equipment into a quarter by accident, and dealers don't take that inventory without some confidence that it's going to move. When shipment volumes climb this sharply after a soft stretch, two things tend to happen on the ground over the following months: allocation for the most in-demand compact track loader, skid steer, and excavator configurations tightens back up, and the aggressive end-of-model-year discounting that shows up during a slow stretch starts to fade. If you've been sitting on a decision waiting for a deal, a rebound quarter like this one is usually the signal that the window is closing, not opening wider.

The Equipment Operators and Owners Actually Feel This First

Excavator operators clearing a utility trench, skid steer operators running a grapple on a land-clearing job, and compact track loader operators grading a site before a slab pour don't read earnings releases. But they're the first people to notice when a dealer's lot thins out on the exact model their crew runs best. A general contractor bidding spring work in February, a demolition sub quoting a teardown, and a landscaper gearing up for a growth season all compete for the same limited allocation of new compact equipment when a manufacturer's shipments are climbing. Being pre-approved for financing before that allocation tightens is the difference between getting the machine your crew wants and settling for whatever's left on the lot.

What This Means If You're Financing Instead of Renting

Here's the part that should actually change how you think about your next purchase. A rental house's fleet doesn't restock instantly when manufacturer shipments pick back up. Rental rates tend to lag, and lag upward, when the new-equipment market tightens, because a rental operator's own replacement cost just went up. Every month you keep renting a skid steer, excavator, or track loader during a demand rebound is a month you're paying someone else's financing cost on top of your own margin, with nothing to show for it when the job's done.

Owning the machine through structured equipment financing means your payment is fixed and known, your crew gets priority scheduling on the unit instead of whatever the rental counter has available that week, and every hour you run it builds equity instead of renting someone else's depreciation schedule. A rebound quarter like Deere's fourth quarter is exactly the moment that case gets stronger, not weaker.

A Real Example: Timing a Backhoe or Excavator Purchase Around a Demand Swing

Picture a general contractor who's been renting a backhoe loader by the month while deciding whether business is steady enough to commit to a purchase. When a report like Deere's fourth quarter shows shipment volumes jumping 27% after a down year, that's real evidence the broader construction equipment market is firming up, which usually means busier bid calendars and tighter labor and equipment availability across the trades that contractor serves. That's the signal to stop renting month-to-month and lock in backhoe equipment financing on a machine the crew will use for years, not just one job.

Don't Confuse One Good Quarter With a Guarantee

None of this means every category of construction equipment is suddenly hot, or that every region is seeing the same rebound. Deere's own full-year number, down 12%, is a reminder that the broader market spent most of fiscal 2025 working through softer demand before this quarter turned. A single strong quarter is a real, verified data point about manufacturer shipment volumes and market direction. It isn't a forecast, and it isn't a reason to rush into a purchase that doesn't fit your actual workload. The honest read is that conditions are firming up industry-wide, and a contractor who's been waiting on the sidelines has real evidence the wait may not pay off much longer.

Why BFC Equipment Loans Exists for Moments Like This

This is exactly the kind of market shift a captive finance arm or a single-brand dealer lender isn't built to help you navigate, because their incentive is to move that manufacturer's current inventory, not to get you the best structure across brands and equipment types. BFC Equipment Loans works with construction companies, subcontractors, roofers, general contractors, and demolition crews across excavators, backhoes, track loaders, skid steers, dozers, mulching equipment, and dump trucks, with financing built around your business's real cash flow and growth plans instead of one manufacturer's sales quarter.

Trade by Trade: Who Should Be Paying the Closest Attention

Not every trade feels a construction equipment rebound the same way. A roofing contractor whose biggest equipment need is a compact track loader for material handling and debris cleanup is competing for the same compact-equipment allocation as site-prep crews, so a 27% jump in shipment volumes matters directly to that roofer's next purchase timeline. A demolition contractor running a large excavator with a hydraulic hammer or shear attachment is watching a different, heavier size class, where lead times can stretch longer even in a strong quarter simply because fewer of those bigger machines get built. A general contractor juggling backhoes, skid steers, and a dump truck or two needs to watch all of it at once, because a tight allocation on any one category can hold up a whole bid.

How to Actually Position Your Business Right Now

The practical move isn't to panic-buy the first machine on a dealer's lot. It's to get your financing lined up before you're standing in front of the unit you want, so you're not negotiating price and loan approval at the same time under time pressure. A pre-approval through BFC Equipment Loans gives you a real number to work with, so when allocation tightens on the excavator, skid steer, or track loader your crew actually runs, you can move the day it shows up instead of waiting on a credit decision while a competitor buys it out from under you.

The Bottom Line for Your Next Equipment Decision

Deere's own reported numbers show a real, verified construction equipment rebound in the back half of fiscal 2025, driven by actual shipment volumes rather than price increases. That's useful, honest information for timing a purchase, not a sales pitch dressed up as market analysis. If your business has been renting equipment month to month and watching the market for a sign that demand is firming back up, this is that sign. Explore our heavy excavator equipment financing options or our dedicated John Deere equipment financing programs to see what a structured loan or lease actually looks like for your business.

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