Total revenues rose 14.7% annually to $1.32 billion, mainly reflecting the growing demand for premium bikes in the international market. Analysts were looking for slower sales growth. Meanwhile, overall shipments dropped 7.8% to 59,226 units, with US shipments contracting as much as 13.3%, the biggest fall in about eight years.
Earnings, excluding manufacturing optimization costs, surged to a two-year high in the September quarter
Of late, Harley-Davidson has been struggling to woo the youth by rolling out new models amidst the falling demand in America, the once-thriving market for the iconic motorcycle brand. As part of its efforts to regain the lost glory, earlier this month, the company initiated a program to make its branded apparel and riding gear available on Amazon for domestic customers. Earlier, the merchandise was available only on Harley’s website and its dealerships.
The company reaffirmed its full-year shipment guidance in the range of 231,000 to 236,000 units and fourth quarter outlook between 45,800 and 50,800 units, with a high probability of the results falling in the lower end of the forecast. The management said it expects to incur $48 million in tariff-related costs in the current fiscal year.
Harley-Davidson rides on overseas sales, tops market estimates
“We are investing to build the next generation of Harley-Davidson riders and we are optimizing our business to drive profitability and cash flow. Through September, cash flow was very strong and revenue was up over 3 percent despite lower motorcycle shipments,” said CEO Matt Levatich.
Harley-Davidson’s stock closed the previous trading session significantly lower and dropped about 3% in early trading Tuesday following the earnings announcement. The stock declined 20% over the past twelve months and 25% since the beginning of the year.