Harley-Davidson's Q4 Mixed Results, CEO Zeitz Maintains Optimism Despite Sales Dip

Harley-Davidson Inc HOG reported fourth-quarter fiscal 2023 HDMC + LiveWire sales of $807 million, missing the consensus of $880.22 million. 

HDMC revenue was down 14% YoY due to lower volumes, where improved mix was offset by incentive spend. HDMC Global motorcycle shipments decreased 13% to 29,544, owing to prudent dealer inventory management and market conditions.

Consolidated revenue was down 8% YoY to $1.05 billion, driven by a revenue decline of 14% at HDMC, partially offset by revenue growth of 15% at HDFS.

HOG’s EPS was $0.18, down from $0.28 a year ago, beating the consensus of $0.04.

The gross profit margin in HDMC contracted 363 bps YoY to 22.97%, and gross profit declined 25.6% to $181.35 million.

The company’s operating loss from HDMC expanded to $(44.17) million from $(32) million in the fourth quarter of 2022.

Harley-Davidson generated $754.89 million in cash from operating activities for the fiscal, compared to $548.46 million a year ago. It held cash and equivalents of $1.65 billion as of December 31, 2023.

“We are excited by the early read of our new Model Year launch, the most comprehensive product development in the touring platform in well over 10 years, that will redefine the Harley-Davidson Grand American Touring experience for years to come and lay the foundation to drive retail sales growth in ’24,” commented Jochen Zeitz, Chairman, President and CEO, Harley-Davidson.

2024 Outlook: Harley-Davidson expects HDMC revenue growth outlook of flat to down 9% and operating income margin of 12.6% – 13.6%.

HOG sees LiveWire electric motorcycle unit sales of 1,000 to 1,500 and an operating loss of $(115) million to $(125) million.

Harley-Davidson anticipates capital investments of $225 million to $250 million.

Price Action: HOG shares are trading lower by 0.64% at $34.32 on the last check Thursday.

Photo via Wikimedia Commons