Key Highlights
- Shares of HOG advanced 1.3% in premarket session to $23.52 following better-than-expected quarterly results
- First quarter earnings showed $0.22 per share on $1.2 billion revenue; sales surpassed Wall Street’s $1 billion consensus
- Worldwide retail motorcycle unit sales increased 8%, while North America saw 14% growth
- Company introduces ‘Back to the Bricks’ initiative aiming for mid-single-digit revenue growth and 10–12% Ebitda margins through 2027
- Revised tariff cost projection now sits at $75M–$90M, lowered from previous $105M upper estimate
Shares of Harley-Davidson moved higher by 1.3% to reach $23.52 during Tuesday’s premarket session after the iconic motorcycle manufacturer delivered first quarter figures exceeding revenue projections and introduced a comprehensive turnaround initiative.
The Milwaukee-based company disclosed quarterly earnings of $0.22 per share against revenue totaling $1.2 billion. Analyst consensus had anticipated $0.22 in earnings per share with approximately $1 billion in sales. Comparatively, the same period last year saw earnings of $1.07 per share on $1.3 billion revenue, representing a notable year-over-year contraction.
Quarterly net income registered at $25 million, a sharp decline from the $133 million recorded in the first quarter of 2025.
North American retail motorcycle unit sales expanded 14% to reach 23,803 bikes. On a global basis, retail sales climbed 8% to 33,507 units. Dealer inventory dropped 22% compared to the prior year, suggesting improved balance between supply and demand across the dealership network.
Management reaffirmed its full-year 2026 outlook, maintaining expectations for retail and wholesale motorcycle sales between 130,000 and 135,000 units.
Introducing the ‘Back to the Bricks’ Initiative
CEO Artie Starrs, who assumed leadership in late 2025, presented the ‘Back to the Bricks’ roadmap concurrent with the quarterly results. This strategic framework sets targets of exceeding $350 million in core operating profit from motorcycle operations by 2027, alongside cost reductions surpassing $150 million.
A central component of this approach involves attracting younger demographics and first-time buyers through more accessible pricing. The company plans to launch the Sprint, an entry-level 440cc motorcycle carrying an approximate $6,000 price tag. Additionally, Harley will resurrect the legendary Sportster line and introduce expanded ‘blank canvas’ customization capabilities.
“We see the Sprint at a price point, approximately $6,000, with a size, maneuverability, features and benefits that are more consistent with what some young riders are looking for,” Starrs said.
The comprehensive strategy also emphasizes enhancing dealer profitability and creating tighter alignment between inventory levels and actual market demand.
Tariff Challenges Persist
Harley produces the majority of its principal products domestically and procures approximately 75% of components from U.S.-based suppliers. Nevertheless, import duties on certain parts including semiconductors continue to pressure cost structures.
The manufacturer absorbed $45 million in tariff-related expenses during the first quarter. For the complete fiscal year, management now projects these costs will fall between $75 million and $90 million — representing a reduction from the previous range of $75 million to $105 million.
Starrs recognized that tariffs remain an ongoing challenge but indicated the financial impact should moderate in subsequent quarters.
Prior to Tuesday’s session, HOG shares had appreciated 13% year-to-date but showed a 2% decline over the trailing twelve months. Looking at a five-year horizon, the stock has depreciated more than 50%.
The ‘Back to the Bricks’ blueprint establishes Ebitda margin objectives of 10% to 12%. For perspective, 2026 Ebitda margins are presently forecast around 4%, according to FactSet data. Over the past five years, Harley’s average annual revenue growth has approximated 2%.
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