Archer-Daniels-Midland Co. has announced plans to reduce its workforce as it anticipates a decline in profits for the third consecutive year. The Chicago-based agricultural trader intends to eliminate between 600 and 700 jobs globally this year, as part of a strategy aimed at achieving up to $750 million in cost savings over the next three to five years. This decision follows a similar move by larger competitor Cargill Inc. and comes after two years of profit declines, attributed to a rebound in grain inventories that has pressured prices and diminished traders’ negotiating leverage. Additionally, ADM is grappling with its own challenges, including an accounting investigation that has resulted in a significant loss of market value.
Chief Executive Officer Juan Luciano stated, “With softer market conditions and policy uncertainty around the world going into 2025, we are focused on improving our operational performance, accelerating cost savings, and simplifying our portfolio.” ADM projects adjusted earnings per share for 2025 to be between $4 and $4.75, a decrease from the $4.74 per share expected for 2024 and below the average analyst estimate of $4.66. For the three months ending in December, adjusted earnings were reported at $1.14 per share, reflecting a 16% decline from the previous year. While this figure aligns with analyst expectations, it marks the lowest fourth-quarter result since 2018. Following this announcement, ADM shares fell by 1.1% in pre-market trading in New York.