Corteva Cuts Profit Outlook as Brazil Slump Sends Shares Down 24%
Corteva cut its full-year profit outlook and warned Brazil weakness will persist, sending shares down 24.3% in their steepest single-day drop on record.
Corteva (CTVA) shares sank to a more than one-year low on Thursday and were on track for their steepest single-day percentage drop ever, after the US agrichemicals firm warned of continued weakness in the Brazilian market for the rest of the year and slashed its annual profit outlook, according to Reuters.
Farmers in Brazil, one of the world's largest crop protection markets, have been hit by liquidity constraints as soaring interest rates lift financing costs and input prices rise, Reuters reported.
Corteva CEO Luke Kissam said in a post-earnings call that the company did not anticipate the magnitude nor the speed of the deterioration experienced in Brazil, according to Reuters. The company had sharply cut its annual outlook on Wednesday. He said Brazil was already a difficult market, that market conditions deteriorated sharply in the final weeks of the third quarter, and that the company has continued to see negative development since then. He added that too much of the product sold into the Brazil channel last year did not go to ground, and that Corteva had more of its own inventory in the channel than expected in 2026.
The company does not anticipate any meaningful improvement in purchasing behavior in Brazil in the near-term, with the elevated inventory expected to impact 2026 core profit by $100 million, Reuters reported.
Corteva on Wednesday slashed its full-year adjusted core profit outlook to $1.1 billion to $1.125 billion, from roughly $1.3 billion previously. Its adjusted per share profit forecast of 76 cents to 80 cents fell below analyst estimates of $1.63 per share, according to data compiled by LSEG.
Earlier this year, the company completed the separation of its seed and genetics business into a separate publicly traded company, Vylor. Corteva stumbled out of the gate in its first standalone earnings report after the separation, said Oppenheimer's Kristen Owen. KeyBanc Capital Markets analyst Salvator Tiano said that given most of the problems were concentrated in Brazil, the third-quarter results were not bad on a standalone basis, adding that the issue was the big deviation from the outlook provided in mid-September.
In delayed trading, Corteva shares were down 24.30% at $9.19.