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Harley-Davidson’s Revenue Could Continue to Fall

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Apr. 16 2019, Updated 2:08 p.m. ET

HOG’s revenue trends

In the fourth quarter, Harley-Davidson’s (HOG) total revenue fell 8.7% YoY (year-over-year) to $956 million. Its motorcycle revenue fell 6.6% YoY to $734 million, and its global motorcycle shipments fell 7.9% YoY to 43,489 units from 47,198. Harley-Davidson’s parts and accessories revenue fell 15.0% YoY in the fourth quarter, and its general merchandise revenue fell 18.0% YoY. Meanwhile, its financial services revenue rose 4.6% YoY to $190,229.

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First-quarter revenue expectations

In the first quarter, analysts expect Harley-Davidson’s motorcycle and related product revenue to fall 12.2% YoY to $1.19 billion from $1.36 billion. They expect the company’s revenue to be flat YoY in the second quarter, at $1.51 billion.

Sales weakness could continue

As the US market has always been Harley-Davidson’s largest, the company depends on US demand. With no signs of home market recovery, HOG’s revenue is expected to stay weak in the short-to-medium term. Like Harley-Davidson, legacy automakers (FXD) Ford Motor (F), Tesla (TSLA), and General Motors (GM) generate a large portion of their sales from the United States.

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