Motorcycle manufacturer Harley-Davidson, Inc. (HOG) reported Tuesday a sharp increase in second-quarter profit, as its financial services arm turned in an operating profit compared to a loss last year. Net revenues from motorcycles and related products were relatively flat with last year, and the company reiterated its full-year motorcycle shipment outlook.
For the second quarter, the Milwaukee, Wisconsin-based company's net income surged to $71.16 million or $0.30 per share from $19.75 million or $0.08 per share in the previous year.
Income from continuing operations was $139.29 million or $0.59 per share, up from $33.38 million or $0.14 per share in the year-ago quarter.
On average, 12 analysts polled by Thomson Reuters expected the company to report earnings of $0.41 per share for the quarter. Analysts' estimates typically exclude special items. For the recent quarter, the company recorded a loss from discontinued operations of $68.13 million or $0.29 per share, much wider than $13.63 million or $0.06 per share in the preceding year. Harley-Davidson said it continues to be in discussions with potential buyers regarding its previously announced intention to sell its MV Agusta motorcyle unit. Second-quarter results included operating income from Harley-Davidson Financial Services or HDFS totaling $60.84 million compared to an operating loss of $90.51 million a year ago. Prior-year second-quarter was affected by two non-recurring, non-cash charges totaling $101.1 million to establish a credit loss provision related to the reclassification of motorcycle loan receivables and to write off all HDFS goodwill, the company stated. President and Chief Executive Officer Keith Wandell said, "Harley-Davidson is making steady progress at executing its strategy to deliver results through focus. We are seeing the benefits of our restructuring and continuous improvement activities reflected in our earnings performance."
Net revenue from motorcycles and related products were $1.135 billion, almost flat with $1.136 billion reported in the same quarter last year. Nine analysts had a consensus revenue estimate of $1.13 billion for the quarter.
Revenues from Harley-Davidson motorcycles during the quarter increased 2.8% to $831.6 million. The company said it shipped 59,046 Harley-Davidson motorcycles to dealers and distributors worldwide, compared to shipments of 58,179 motorcycles in the year-ago quarter. According to the company, worldwide retail sales of new Harley-Davidson motorcycles decreased 5.5% from the year-ago quarter, but showed a sequential moderation in the rate of decline from the previous four quarters. In the U.S., retail new Harley-Davidson motorcycle sales were down 8.4% and it decreased 0.2% in the international markets. For the six-month period, the company reported net income of $104.48 million or $0.45 per share, down from $137.1 million or $0.59 per share in the prior year. Income from continuing operations increased to $208.03 million or $0.89 per share from $161.43 million or $0.69 per share in the same period last year. Net revenue from motorcycles and related products for the first six months decreased to $2.172 billion from $2.414 billion in the preceding year.
Looking ahead to the third quarter, the company expects to ship 53,000 to 58,000 Harley-Davidson motorcycles.
For the full year, the company reaffirmed its expectation to ship 201,000 to 212,000 Harley-Davidson motorcycles to dealers and distributors worldwide, a reduction of 5%-10% from last year. Wandell said, "...we continue to believe conditions will remain challenging this year for new motorcycle purchases and we will manage the business based on that expectation, with a continued strong focus on managing supply in line with demand."
The company continues to expect full-year capital expenditures between $235 million and $255 million, including $95 million to $110 million to support restructuring activities. Further, for the full year, Harley-Davidson continues to expect savings of $135 million to $155 million from previously announced restructuring activities, increasing to expected annual ongoing savings of about $240 million to $260 million upon completion of these restructuring activities. The company and the unions representing its Wisconsin production employees are scheduled to begin negotiations this week on new labor agreements that would take effect upon the expiration of the current contracts in April 2012. The company noted that in the event of it not achieving some of its objectives through the agreement with the unions by mid-September 2010, it will move Wisconsin production operations to another U.S. location. HOG closed Monday's regular trading at $23.61 on the NYSE. In the past 52 weeks, the shares have been trading in a range of $19.16-$36.13.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.