Harley Davidson motorcycles are displayed for sale at a showroom in Bangkok, Thailand, June 28, 2018.
Athit Perawongmetha | Reuters
Sales of Harley Davidson‘s signature motorcycles continued to slide during the second quarter as profit, though better than expected, eroded 19% for the struggling manufacturer.
Its shares dropped 3% in premarket trading.
Here’s how the company did compared with what Wall Street expected:
- EPS of $1.23, versus, Refinitiv estimates of $1.20.
- Revenue of $1.43 billion, versus Refinitiv estimates of $1.441.
The company reported $195.6 million in net income during the second quarter, versus net income of $242.3 million during the same quarter last year, it said in releasing its results before the markets opened Tuesday.
Sales of motorcycles, parts and merchandise fell to $1.43 billion during the second quarter from $1.53 billion during the same three months last year — a decline of 6%.
Though the company beat on earnings, they slumped on sales with Harley-Davidson worldwide retail sales decreasing 8.4% in the second quarter. U.S. retail sales were also down 8.0% in the quarter with international retail sales down 8.9%.
The “HOG” maker claimed the declines were driven by weakness in developed international markets.
Harley-Davidson has struggled in recent years with declining sales at home and abroad. The company’s bike deliveries are down by 5.3% compared to a year ago, according to its second quarter earnings report. In Asia and the pacific Harley has seen Motorcycle retail sales drop by 4,165 units from 2016 to 2018.
The regions largest motorcycle market — India, has also seen the company’s sales fall 21.6% from 3,690 units sold in 2016 to 2,676 units sold in the first quarter of 2019.
The company is also preparing for the gradual increase of tariffs from the European Union. In its earnings report Harley said that it had “obtained regulatory approvals required to mitigate the majority of incremental EU tariffs.”
Tariffs have been a part of the motorcycles makers story since it drew the ire of President Donald Trump on after it announced it was moving production of some of it’s bikes abroad to Thailand.
That strategy of manufacturing in Thailand appears to be working in southeast Asia where it said sales rose 77% during the second quarter.
Correction: Harley’s motorcycle revenue slightly missed estimates at $1.43 billion. Its total revenue was $1.63 billion.