SPECIAL ITEMS

12 Months Ended

Nov. 02, 2025

SPECIAL ITEMS

SPECIAL ITEMS

4. SPECIAL ITEMS

2025 Special Items

Litigation Accrual

In the fourth quarter of 2025, we have increased our total accrued losses on unresolved legal matters in connection with a consolidated multidistrict class action antitrust lawsuit by $95 pretax ($75 after-tax) which was included in “Selling, administrative and general expenses” (see Note 20). The expense was allocated $47 to PPA, $24 to SAT, and $24 to CF.

Impairment

In the third quarter of 2025, we recorded a non-cash impairment charge of $61 pretax ($49 after-tax), primarily related to the trade name and customer relationship assets of our external overseas battery operations. Of this amount, $53 was recorded in “Selling, administrative and general expenses” and $8 in “Cost of sales.” This is presented in “Impairments and other adjustments” in the statements of consolidated cash flows. The loss was allocated $28 to PPA, $17 to SAT, and $16 to CF. The impairment resulted from slowing external demand for batteries, which indicated that it is probable future cash flows would not cover the carrying value of the assets (see Note 25).

Banco John Deere S.A.

In February 2025, we completed the transaction with Bradesco (see Note 3) for the sale of 50% ownership in BJD. In the first quarter of 2025, a pretax and after-tax gain (reversal of previous losses) of $32 was recorded in “Selling, administrative and general expenses” and presented in “Impairments and other adjustments” in the statements of consolidated income and consolidated cash flows, respectively, related to a decrease in valuation allowance.

Tax Items

In the first quarter of 2025, we recorded favorable net discrete tax items primarily due to tax benefits of $110 related to the realization of foreign net operating losses from the consolidation of certain subsidiaries and $53 from an adjustment to an uncertain tax position of a foreign subsidiary.

2024 Special Items

Legal Settlements

In 2024, we reached legal settlements concerning patent infringement claims. As a result of these settlements, we recognized a total of $57 pretax gain ($45 after-tax) in "Other income," providing a benefit of $17 to PPA and $40 to CF. These settlements resolve the disputes without any admission of liability by the parties involved. We believe that these settlements enhance our ability to protect our intellectual property and reinforce our commitment to innovation and technological advancement.

Impairment

In the fourth quarter of 2024, we recorded a non-cash impairment charge of $28 pretax and after-tax in “Equity in income (loss) of unconsolidated affiliates” for an other than temporary decline in value of an investment recorded in SAT. See Note 25 for fair value measurement information.

Employee-Separation Programs

In the third quarter of 2024, we implemented employee-separation programs for our salaried workforce in several geographic areas, including the United States, Europe, Asia, and Latin America. The programs’ main purpose was to help meet our strategic priorities while reducing overlap and redundancy in roles and responsibilities. The programs were largely involuntary in nature with the expense recorded when management committed to a plan, the plan was communicated to the employees, and the employees were not required to provide service beyond the legal notification period. For the limited voluntary employee-separation programs, the expense was recorded in the period in which the employee irrevocably accepted a separation offer.

In 2024, we recorded $157 pretax expenses ($124 after-tax) related to the programs. The programs’ pretax expenses were as follows:

	PPA		SAT		CF		FS		Total
Employee-Separation Programs:
Cost of sales	$	21	$	11	$	8			$	40
Research and development expenses		22		9		2				33
Selling, administrative and general expenses		34		23		12	$	10		79
Total operating profit decrease	$	77	$	43	$	22	$	10		152
Non-operating profit expenses*										5
Total									$	157

*    Relates primarily to corporate expenses.

Banco John Deere S.A.

In the third quarter of 2024, we reclassified the BJD business as held for sale, including a reversal of $38 in allowance for credit losses. At October 27, 2024, a $97 valuation allowance was recorded on the assets held for sale, which was presented in “Impairments and other adjustments” in the statements of consolidated cash flows. The net impact of these entries was a pretax and after-tax loss of $59 recorded in “Selling, administrative and general expenses.” See Note 25 for fair value measurement information.

Redeemable Noncontrolling Interest

In the third quarter of 2024, we exercised our right to purchase the remaining 20% interest in SurePoint. The arrangement was accounted for as an equity transaction with no gain or loss recorded in the statements of consolidated income.

2023 Special Items

Sale of Russian Roadbuilding Business

In October 2023, we sold our Russian roadbuilding business, recognizing a loss of $18 (pretax and after-tax). The loss was recorded in “Other operating expenses” in the CF segment.

Brazil Tax Ruling

In the third quarter of 2023, the Brazil Superior Court of Justice published a favorable tax ruling regarding taxability of local incentives, which allowed us to record a $243 reduction in the provision for income taxes and $47 of interest income.

Financial Services Financing Incentives Correction

In the second quarter of 2023, we corrected the accounting treatment for financing incentives offered to John Deere dealers, which impacted the timing of expense recognition and the presentation of incentive costs in the consolidated financial statements. The cumulative effect of this correction, $173 pretax ($135 after-tax), was recorded in “Selling, administrative and general expenses” in the second quarter of 2023. Prior period results for Deere & Company were not restated, as the adjustment was considered immaterial to our financial statements.