Deere & Co., maker of farm equipment with that little yellow and green deer logo, reported its latest quarterly results last Friday — and gave us yet another example of the see-saw numbers financial analysts will see this year as Corporate America reports the implications of tax reform.

The numbers were for Deere’s fiscal second quarter, ending on April 29. The earnings release was filled with the usual flowery language: $10.7 billion in revenue, up 29 percent from the prior-year period; net income of $1.21 billion, up 50 percent from one year ago. What’s not to love, right?

Then we noticed this disclosure: “Affecting results for the second quarter and first six months of 2018 were provisional adjustments to the provision for income taxes due to the enactment of U.S. tax reform.”

Ah. Let’s dig into that.

Deere reported second quarter results including net income of $1.21 billion. But net income for the first half of fiscal 2018 — which includes those rosy results from Q2 — is only $673 million. (See Fig. 1, below.) Which therefore means Deere reported a loss in its fiscal first quarter.

So searched Deere’s report for its fiscal first quarter, and sure enough, we found this:

Primarily as a result of those provisions of tax reform, the Company recorded a net provisional income tax expense of $965 million in the first quarter of 2018… The discrete tax expense related to the remeasurement of the Company’s net deferred tax assets to the new corporate income tax rate was $715 million and the deemed earnings repatriation tax was $262 million. The discrete tax expense was partially offset by a net benefit of $12 million, primarily related to the lower income tax rate on the first quarter of 2018 income.

And if you view Deere’s results on our Company-in-Detail page (be sure the setting is for quarterly results; not annual results which are the default), you can see that Deere increased its provision for income taxes from $129 million in first quarter 2017 to $1.06 billion in first-quarter 2018.

What’s more, Deere estimates that its provision for income taxes in the second quarter will be only $177 million — less than half the $371.9 million it paid in Q2 2017. (See Fig. 2, below; relevant line flagged in red.)

In other words, like many companies we’ve already noted previously on this blog, Deere had to swallow a large one-time adjustment in its first quarter 2018 thanks to tax reform, largely due to the revaluation of tax assets and paying a one-time repatriation tax. Now we’re seeing what the next numbers look like, after that one quarter’s worth of pain — and those numbers look pretty good.

Whether they’re good because of fundamentally strong growth, or good because the income statement is high on tax cuts, is another question. But Calcbench can always help you find the data to answer it.