Shares of Harley-Davidson dropped after the iconic motorcycle maker slashed its full-year revenue forecast as its customers chafed at price inflation and high borrowing costs — as well as a social-media campaign that attacked the company’s DEI policies.
The Milwaukee-based company said it now expects its yearly revenue to drop 14% to 16% — steeper than the 5% to 9% decline it had previously forecast.
Harley-Davidson estimated operating margins between 7.5% and 8.5%, down from estimates of 10.6% to 11.6%.
Retail sales plunged 10% in the company’s North America division.
The company saw lower volumes in most of its major markets.
“We have worked diligently through the quarter to mitigate the impact of high interest rates, and macroeconomic and political uncertainty, that continue to put pressure on our industry and customers, especially in our core markets,” CEO Jochen Zeitz said in a statement.
The company reported earnings per share of 91 cents for the period ended Sept. 30 — far below the $1.38 a share a year earlier.
Motorcycle and related product sales totaled $876 million in the third quarter, missing estimates of $938.2 million.
Harley-Davidson shares fell 2.1% Thursday morning.
Harley-Davidson has shifted its focus to its more expensive, and hence more profitable, touring bikes.
The company has also been offering more deals on new bike purchases.
But the deals weren’t enough to salvage profits.
On top of uncertainty about the economy, Harley-Davidson was slammed this summer by a boycott against the company’s DEI policies.
After conservative activist Robby Starbuck attacked Harley-Davidson on X, the company revealed in August that it no longer had hiring quotas or supplier diversity spend goals.
“They made this statement because we’re obviously having an impact on their customer base,” Starbuck told Fox News in August.
Starbuck said his conservative movement is “three for three” after his attacks on John Deere and Tractor Supply Co. – which rely heavily on consumer bases in red states – also led the companies to revoke their DEI policies.
Harley-Davidson was also hit by complaints from dealers that they were being sent too many motorcycles over the summer. In July, the company said it planned to cut dealer inventory by about 30%.
Most recently, the company recalled more than 40,000 motorcycles in September due to a risk for short-circuiting, which could lead to a crash, according to the National Highway Traffic Safety Administration.
“We are optimistic about our ability to make sound progress in the new year, and we are expecting further interest rate reductions and improved consumer confidence will provide the industry with a needed tailwind,” Zeitz said.
