Corteva Q1 Earnings Call Highlights

Key Points

• Corteva posted a strong first quarter, with organic sales up 7% and operating EBITDA rising 21% to more than $1.4 billion. Management said both Seed and Crop Protection delivered healthy double-digit EBITDA gains, helped by volume, pricing, currency and cost savings.
• The company reaffirmed its 2026 outlook for operating EBITDA of $4.0 billion to $4.2 billion and EPS of $3.45 to $3.70. While tariffs are slightly better than expected, Corteva warned that higher oil prices could create a $40 million headwind later in the year.
• Corteva’s planned separation remains on track for the fourth quarter, with the future seed company to be named Vylor and the crop protection business retaining the Corteva name. The company also said it expects one-time separation costs of about $350 million and approved a $1.5 billion pension contribution to support both standalone businesses.

Corteva NYSE: CTVA reported a stronger-than-expected start to 2026, with management pointing to broad demand for seed and crop protection products, favorable timing in North American seed deliveries and continued cost savings as key drivers of first-quarter earnings growth.

On the company’s first-quarter earnings call, Chief Executive Officer Chuck Magro said both Seed and Crop Protection delivered “healthy double-digit EBITDA gains,” supported by price/mix, volume, cost and currency benefits. Corteva reaffirmed its full-year outlook and said the first half is tracking “a little better than expected,” though management cautioned that agriculture results are better assessed by half-year periods because of seasonal timing shifts.

First-quarter sales and EBITDA rise

David Johnson, Corteva’s executive vice president and chief financial officer, said organic sales increased 7% from a year earlier, with Seed up 9% and Crop Protection up 4%. Currency added another 4% to sales, in line with expectations.

Operating EBITDA rose 21% to more than $1.4 billion, while operating EBITDA margin expanded by 240 basis points to more than 29%. Johnson said volume gains, price/mix, currency and cost benefits more than offset higher selling expenses.

In Seed, price/mix rose 3% with gains in all regions, while volume increased 6%. Johnson said the performance reflected expected volume shifts from the fourth quarter of 2025, an early start to the North American season due to favorable weather and continued growth in the Brevant retail brand.

Crop Protection pricing declined 2%, primarily due to competitive dynamics in Latin America, while volume increased 6% across all regions. Johnson said new products and spinosyns posted double-digit volume gains in the quarter.

Guidance reaffirmed as management monitors second-half risks

Corteva reaffirmed its 2026 guidance for operating EBITDA of $4.0 billion to $4.2 billion, operating EBITDA margins of 22% to 23% and operating EPS of $3.45 to $3.70. Johnson said the midpoint of the EPS range represents about 7% growth.

Management said tariffs are included in the company’s guidance and are trending “slightly better than expected.” However, higher oil prices are expected to create a $40 million headwind, mainly in the second half of the year as Crop Protection inventory turns. Magro said Corteva has minimal commercial presence in the Middle East but is monitoring the conflict’s impact on oil prices and feedstock exposure.

Magro said farmers remain cautious and value-driven, but strong acreage is supporting demand for both seed and crop protection. In the U.S., the company’s guidance assumes a shift from corn to soybeans, with corn acres down roughly 3% to 4%. Magro said Corteva is comfortable with roughly 95 million acres of corn and 85 million acres of soybeans being planted this spring.

For the broader Crop Protection market, Corteva expects modest full-year growth, with low-single-digit volume gains more than offsetting slightly negative pricing. For Corteva specifically, management expects mid-single-digit volume growth to more than offset low-single-digit pricing pressure.

Seed business advances licensing and royalty goals

Magro said Corteva expects Enlist soybeans to be planted on about 65% of U.S. soybean acres in 2026 if current trends hold, calling Enlist the top-selling soybean technology in the U.S. He said the company is now focused on becoming a leading provider of soybean technology in Brazil, where Corteva’s branded corn business already holds the No. 1 position.

The company also said it expects to move from royalty neutral to royalty positive later this year. Johnson said net royalty expense declined by another $30 million in the first quarter, driven by lower royalty expense on certain in-licensed traits. Magro said Corteva already has more than 100 independent seed company licensees for PowerCore Enlist corn and Enlist E3 soybeans.

During the Q&A, Judd O’Connor, executive vice president of the Seed Business Unit, said North American seed results should be assessed across the first half rather than the first quarter. He said a single week of deliveries around the end of March can materially affect quarterly corn and soybean volume comparisons, and he said there were “no red flags” in the order book.

Crop Protection outlook supported by Latin America and biologicals

Robert King, executive vice president of the Crop Protection Business Unit, said the expected second-half volume acceleration in crop protection is primarily tied to Latin America. He cited biologicals, including Utrisha N and BlueN, as well as spinosyn demand and additional crop protection needs from acreage in tropical climates.

Magro said the crop protection industry appears to be returning to modest growth after difficult conditions in 2023 and 2024 and a flat market in 2025. He said higher energy and oil prices are increasing production costs for active ingredients in low-cost jurisdictions such as India and China. He also noted a slight slowdown in China exports into Brazil, though he said it was too early to call it a trend.

King said roughly two-thirds of Corteva’s crop protection portfolio is differentiated. He said new products are expected to generate nearly $2 billion in revenue this year and continue growing, with products such as Arylex and Rinskor not yet at peak revenue. He also pointed to at least seven new active ingredients expected over the next decade.

Separation remains on track for fourth quarter

Corteva said its planned separation remains on track for the fourth quarter. The crop protection company will retain the Corteva name, while the future pure-play seed and genetics company will be called Vylor. Magro said Vylor’s name is derived from “valor” and is intended to reflect the legacy of employees and farmers behind the company’s seed business.

Magro said Corteva recently announced Luke Kissam as the incoming CEO of the future Corteva crop protection company, effective June 1, and has named executive leadership teams for both companies. The company filed its initial Form 10 with the SEC and expects a public filing later in the second quarter.

Johnson said one-time separation costs are expected to be approximately $350 million, with most of that spending in the second half of 2026. He said Corteva is seeing some favorability versus its prior estimate of $100 million in net dis-synergies, with $50 million included in the 2026 guidance.

The board also approved a $1.5 billion discretionary contribution to the U.S. pension plan. Johnson said the move is intended to help position both companies with strong standalone investment-grade credit profiles.

Corteva also reiterated plans to return capital to shareholders, including approximately $500 million of share repurchases in the first half of the year. Johnson said first-quarter cash flow was affected by the Bayer agreement and separation items, but absent those items, the company would expect full-year free cash flow conversion to align with its midterm target discussed at its 2024 Investor Day.

About Corteva NYSE: CTVA

Corteva, Inc NYSE: CTVA is an independent global agriculture company that was established as a publicly traded firm in mid‑2019 following the separation of the agriculture businesses from DowDuPont. The company focuses on delivering technologies and products that help farmers increase productivity and manage crop health. Corteva's operations combine seed genetics, crop protection chemistries, digital tools and biological solutions to address the full cycle of crop production.

Core business activities include research and development of seed genetics and trait technologies, formulation and sale of crop protection products (such as herbicides, insecticides and fungicides), and the development of seed treatments and biologicals.

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