Harley-Davidson, Inc. (NYSE:HOG) Q2 2025 Earnings Call July 30, 2025 9:00 AM ET Company Participants Jochen Zeitz - Chairman, President & CEO Jonathan R. Root - CFO & President of Commercial Shawn Michael Collins - Director of Investor Relations Conference Call Participants Alexander Thomas Perry - BofA Securities, Research Division Craig R. Kennison - Robert W. Baird & Co. Incorporated, Research Division Jaime M. Katz - Morningstar Inc., Research Division James Lloyd Hardiman - Citigroup Inc., Research Div ...

摩托车制造商哈雷戴维森(HOG.US)盘初一度大涨超24%，最高触及28.55美元，创逾半年新高。消息面 上，哈雷戴维森第二季度营收为13.1亿美元，高于分析师预期的11亿美元。此外，公司同意将其金融服 务部门4.9%的股份出售给私募KKR和投资管理公司PIMCO，作为长期合作伙伴关系的一部分，这笔交 易将提供12.5亿美元的自由现金。该金融服务部门还将以溢价形式出售超过50亿美元的零售贷款应收账 款。公司计划利用收益来减少4.5亿美元的债务、向股东返还5亿美元，并为增长投资提供资金。(格隆 汇) ...

Core Insights - Harley-Davidson reported a revenue of $1.05 billion for the quarter ended June 2025, reflecting a year-over-year decline of 22.6% and an EPS of $0.88 compared to $1.63 a year ago, indicating a significant drop in financial performance [1] - The reported revenue was 7.04% lower than the Zacks Consensus Estimate of $1.13 billion, and the EPS fell short of the consensus estimate of $0.99 by 11.11% [1] Financial Performance Metrics - Total worldwide retail sales of Harley-Davidson motorcycles were 42,254, below the estimated 45,308 [4] - Total worldwide motorcycle shipments were 35,837, compared to the estimated 39,622 [4] - Revenue from motorcycles and related products (HDMC) was $1.04 billion, missing the estimated $1.13 billion, marking a 22.6% decline year-over-year [4] - Financial services revenue (HDFS) was $257.44 million, slightly below the estimated $268.81 million, representing a 2.3% decline year-over-year [4] - Live Wire revenue was $6.01 million, below the estimated $7.35 million, reflecting a 6.8% decline year-over-year [4] - Revenue from parts and accessories was $186.87 million, compared to the estimated $189.7 million, showing a 3.6% decline year-over-year [4] - Apparel revenue was $55.24 million, significantly lower than the estimated $63.64 million [4] - Licensing revenue increased to $5.94 million, exceeding the estimated $4.57 million, with an 8.4% increase year-over-year [4] - Motorcycle revenue was $778.05 million, below the estimated $848.49 million, indicating a 27.2% decline year-over-year [4] Stock Performance - Harley-Davidson shares have returned -8.4% over the past month, contrasting with the Zacks S&P 500 composite's +3.4% change, indicating underperformance in the market [3] - The stock currently holds a Zacks Rank 4 (Sell), suggesting potential continued underperformance in the near term [3]

Financial Data and Key Metrics Changes - Consolidated revenue for Q2 decreased by 19%, primarily due to a planned reduction in motorcycle shipments and soft demand [10][26] - Consolidated operating income was $112 million, reflecting a 69% decline at HDMC [27] - Earnings per share for Q2 was $0.88, with global retail sales down 15% year over year [27][28] - Cash and cash equivalents at the end of Q2 were $1.6 billion, down $261 million from the previous year [47][48] Business Line Data and Key Metrics Changes - HDMC revenue decreased by 23% in Q2, driven by a 28% decline in motorcycle shipments [34] - HDFS revenue was $257 million, a decrease of 2%, while operating income was $70 million, also down 2% [43][44] - LiveWire reported an operating loss of $19 million, an improvement from a $28 million loss in the prior year [46] Market Data and Key Metrics Changes - North American retail sales were down 17%, while international markets saw a 12% decline [27][28] - In Asia Pacific, retail sales decreased by 21% due to intense competition [31] - The U.S. cruiser category experienced a 6% volume growth, increasing market share to 53% [32] Company Strategy and Development Direction - The company entered strategic partnerships with KKR and PIMCO for HDFS, enhancing flexibility and reducing overall leverage [4][6] - Plans to reduce debt by $450 million and accelerate a $1 billion share buyback program [9][50] - Introduction of new entry-level products and a small displacement motorcycle targeting a price below $6,000 [20][19] Management's Comments on Operating Environment and Future Outlook - Management noted ongoing economic uncertainty and elevated interest rates impacting customer purchasing behavior [10][11] - There is cautious optimism regarding future trade agreements that may mitigate operational impacts [14] - Management expects a significant improvement in retail performance in July, with positive trends anticipated for the remainder of the year [67][68] Other Important Information - The company plans to implement a new efficiency program leveraging technology, including AI, to drive cost savings [11] - The global tariff environment remains uncertain, with an estimated full-year impact from tariffs projected between $50 million and $85 million [42] Q&A Session Summary Question: What are the components used to calculate the 1.75 times book value marker for the HDFS transaction? - The calculation is based on the proceeds from KKR and PIMCO's equity investment relative to the post-transaction book value of HDFS [52][54] Question: What is driving the underlying profitability of HDFS, and what is the normalized profitability expected in 2026? - The profitability has improved due to stabilization in used values and better repossession rates, with normalized earnings expected to be around $240 million to $250 million annually [56][65] Question: How does the company feel about current dealer inventories and the target for year-end? - The company expects a significant reduction in dealer inventory, targeting a double-digit decline by year-end [73] Question: Why was the 4.9% equity sale the right level, and are there any tax ramifications? - The 4.9% limit is due to regulatory requirements from the FDIC, and the $1.25 billion figure is a pretax amount [78][82] Question: Is there any guarantee of growth in retail sales or receivables associated with the HDFS transaction? - There are no guarantees regarding growth rates or loss levels associated with the transaction [89]

Financial Data and Key Metrics Changes - Consolidated revenue for Q2 2025 decreased by 19%, primarily due to a planned reduction in motorcycle shipments and soft demand [10][27] - Consolidated operating income was $112 million, reflecting a 69% decline at HDMC, while HDFS operating income decreased by 2% [28][43] - Earnings per share for Q2 was $0.88, with global retail sales down 15% year over year [28][29] - Operating cash flow decreased by $68 million from the prior period, totaling $509 million [47] Business Line Data and Key Metrics Changes - HDMC revenue decreased by 23% in Q2, driven by a 28% decline in motorcycle shipments [34][35] - HDFS revenue was $257 million, down 2% due to lower retail and commercial receivables [43] - LiveWire reported an operating loss of $19 million, an improvement from a $28 million loss in the prior year [46] Market Data and Key Metrics Changes - North American retail sales were down 17%, while international markets saw a 12% decline [28][29] - In EMEA, retail was down 5%, with growth in Germany and the Benelux regions offset by declines in France and the UK [30] - Asia Pacific retail was down 21%, attributed to intense competition in the lightweight motorcycle segments [31] Company Strategy and Development Direction - The company entered strategic partnerships with KKR and PIMCO for HDFS, aiming to enhance long-term value and reduce overall funding costs [4][5] - Plans to reduce debt by $450 million and accelerate a $1 billion share buyback program were announced [9][49] - The introduction of new entry-level products and a small displacement motorcycle is scheduled for 2026, targeting a price below $6,000 [20][19] Management's Comments on Operating Environment and Future Outlook - Management noted ongoing economic uncertainty and elevated interest rates impacting customer purchasing behavior [10][11] - There are signs of improvement in customer traffic in North America, with expectations for positive retail performance in the second half of the year [66][67] - The company remains cautious about the global tariff environment, estimating a full-year impact of $50 million to $85 million from tariffs [42] Other Important Information - The HDFS transaction is expected to generate $1.25 billion in cash for Harley Davidson, representing about 40% of the current market cap [9][10] - The company is committed to returning capital to shareholders despite the challenging operating environment [48] Q&A Session Summary Question: What are the components used to calculate the 1.75 times book value marker for the HDFS transaction? - The calculation is based on the proceeds from KKR and PIMCO's equity investment in the business, reflecting the premium paid versus the post-transaction book value [52][54] Question: What is driving the underlying profitability of HDFS? - The profitability has improved due to stabilization in used motorcycle values and better repossession rates, contributing positively to HDFS performance [56][58] Question: How does the company view current dealer inventories and what is the target for year-end? - The company expects a significant reduction in dealer inventory, targeting a double-digit decline by year-end [71] Question: What is the timing of the model launch shift? - The model year shift is planned for the fall, with new models being introduced to maintain excitement in dealerships [73][74] Question: Are there any guarantees associated with the HDFS transaction regarding growth in retail sales? - There are no guarantees for maintaining certain growth rates or loss levels; however, there is confidence in the business's ability to run profitably through cycles [88][89]

Financial Data and Key Metrics Changes - Consolidated revenue in Q2 2025 decreased by 19%, largely in line with expectations across HDMC and HDFS, while revenue also decreased at LiveWire [27] - Consolidated operating income for Q2 was $112 million, a decline of 69% at HDMC, while HDFS operating income decreased by 2% [28] - Earnings per share for Q2 was $0.88, with global retail sales down 15% year-over-year [28][29] - Operating cash flow was $509 million, down $68 million from the prior period, with total cash and cash equivalents at $1.6 billion, a decrease of $261 million year-over-year [46][47] Business Line Data and Key Metrics Changes - HDMC revenue decreased by 23% in Q2, driven by a 28% decline in motorcycle shipments, totaling 36,000 units compared to 50,000 units in the prior year [34] - HDFS revenue was $257 million, a decrease of 2%, with operating income at $70 million, down 2% compared to last year [43] - LiveWire reported an operating loss of $19 million, an improvement from a $28 million loss in the prior Q2, with unit sales down to 55 from 158 [46] Market Data and Key Metrics Changes - North American retail sales were down 17%, while international markets saw a decline of 12% [28][29] - In EMEA, retail was down 5%, with growth in Germany and the Benelux regions offset by declines in France and the UK [30] - Asia Pacific retail was down 21%, attributed to intense competition in the lightweight motorcycle segments [31] Company Strategy and Development Direction - The company has entered strategic partnerships with KKR and PIMCO for HDFS, aiming to enhance long-term value and reduce overall funding costs [3][5] - A new efficiency program will be introduced to enhance productivity, leveraging technology including AI for cost savings [11] - Plans to launch new entry-level products and a small displacement motorcycle are set for 2026, targeting an entry price below $6,000 [20][19] Management's Comments on Operating Environment and Future Outlook - Management noted ongoing economic uncertainty and elevated interest rates impacting customer purchasing behavior [10][29] - There are signs of improvement in customer traffic in North America, with expectations for positive comp growth in the latter half of the year [64][65] - The company remains cautious about the global tariff environment, estimating a full-year impact from tariffs to be between $50 million and $85 million [42] Other Important Information - The HDFS transaction is expected to generate $1.25 billion in cash for Harley Davidson, allowing for debt reduction and share buybacks [9][49] - The company plans to reduce debt by $450 million and invest up to $300 million in future growth opportunities [49] Q&A Session Summary Question: What are the components used to calculate the 1.75 times book value marker for the HDFS transaction? - The calculation is based on the proceeds from KKR and PIMCO for their equity investment in the business, reflecting the premium paid versus the post-transaction book value [51][53] Question: What is driving the underlying profitability of HDFS, and what is the normalized profitability expected in 2026? - The profitability has improved due to stabilization in used values and better repossession rates, with normalized earnings expected to be around $240 million to $250 million annually [55][62] Question: How does the company feel about current dealer inventories and the target for year-end? - The company expects a significant reduction in dealer inventory, targeting a double-digit decline by year-end [69][70] Question: What is the rationale for the 4.9% equity sale in the HDFS transaction? - The 4.9% limit is due to regulatory requirements from the FDIC regarding ownership percentages in the HDFS business [76][78]

Shares of Harley-Davidson surged Wednesday after the motorcycle maker announced plans to sell a nearly 10% stake and more than $5 billion of retail loans https://t.co/3xEJSSkeBL ...

Company Performance - Harley-Davidson reported quarterly earnings of $0.88 per share, missing the Zacks Consensus Estimate of $0.99 per share, and down from $1.63 per share a year ago, representing an earnings surprise of -11.11% [1] - The company posted revenues of $1.05 billion for the quarter ended June 2025, missing the Zacks Consensus Estimate by 7.04%, and down from $1.36 billion year-over-year [2] - Over the last four quarters, Harley-Davidson has surpassed consensus EPS estimates two times, but has not beaten consensus revenue estimates [2] Stock Performance - Harley-Davidson shares have lost approximately 23.8% since the beginning of the year, while the S&P 500 has gained 8.3% [3] - The current Zacks Rank for Harley-Davidson is 4 (Sell), indicating expected underperformance in the near future [6] Future Outlook - The current consensus EPS estimate for the coming quarter is $0.94 on revenues of $1.02 billion, and for the current fiscal year, it is $2.79 on revenues of $3.78 billion [7] - The outlook for the Automotive - Domestic industry, to which Harley-Davidson belongs, is currently in the bottom 39% of over 250 Zacks industries, which may impact the stock's performance [8]

Q2 2025 Performance - Harley-Davidson diluted EPS was $0.88[6] - HDMC operating income margin was 5.9%[6] - HDMC revenue decreased by 23% year-over-year[6] - Global motorcycle shipments decreased by 28%, primarily due to planned dealer inventory reduction[6] - Global motorcycle retail sales decreased by 15% year-over-year[6] - Global dealer inventories decreased by 28% compared to Q2 '24[6, 21] - The cost of new or increased tariffs implemented in '25 was $13 million in Q2 '25[6] - HDFS operating income margin was 27.1%[6] HDFS Transaction - Strategic partners valued the HDFS business at approximately 1.75x post-transaction book value[7, 11, 14] - HDFS agreed to sell a 4.9% common equity interest to investment vehicles managed by KKR and PIMCO[7] - HDFS will sell approximately two-thirds of HDFS future retail loan originations at a premium on an annual basis for five years[7, 14, 55, 58] - The transaction unlocks $1.25 billion in discretionary cash, representing approximately 40% of current Harley-Davidson market capitalization[7] - HDFS agreed to sell over $5 billion of existing gross consumer retail loan receivables and residual interests in securitized consumer loan receivables at a premium[7, 14, 55] - HDFS expects to use a portion of the proceeds to reduce indebtedness to optimize its post-transaction capital structure[7] Financial Outlook & Capital Allocation - HDFS transaction is expected to generate ~$1B of available cash and allow for ~$1.25B distribution to H-D from HDFS[14, 67] - The company intends to use available cash for share buyback of $500M, HDI debt reduction of $450M and reinvestment in HDMC[14, 66]

Financial Performance - Harley-Davidson reported a diluted EPS of $0.88, down 46% from $1.63 in Q2 2024[7] - Consolidated revenue decreased by 19% year-over-year to $1,307 million, primarily due to a 23% decline in HDMC revenue[7] - HDMC revenue for Q2 2025 was $1,043,649,000, a decrease of 22.6% compared to $1,348,906,000 in Q2 2024[27] - Gross profit for HDMC in Q2 2025 was $298,705,000, down 31.0% from $433,126,000 in Q2 2024[27] - Operating income from HDMC for the first half of 2025 was $177,587,000, a decline of 59.3% compared to $436,351,000 in the same period of 2024[27] - HDFS revenue for Q2 2025 was $257,438,000, slightly down from $263,539,000 in Q2 2024[27] - Net income attributable to Harley-Davidson, Inc. for Q2 2025 was $107,569,000, a decrease of 50.7% from $218,269,000 in Q2 2024[27] - Basic earnings per share for Q2 2025 was $0.89, down from $1.64 in Q2 2024, representing a decline of 45.7%[27] - Gross profit for Q2 2025 was $299 million, down 30.9% from $433 million in Q2 2024, primarily due to a volume decline of $101 million[36] Sales and Shipments - Global motorcycle shipments fell by 28% to 35.8 thousand units, with retail sales down 15% year-over-year[8][10] - U.S. motorcycle shipments decreased to 21,736 units in Q2 2025, down 32.8% from 32,334 units in Q2 2024[34] - Worldwide retail sales of Harley-Davidson motorcycles totaled 42,254 units in Q2 2025, a decline of 15.5% compared to 49,998 units in Q2 2024[40] - North America retail sales decreased to 28,931 units in Q2 2025, down 17.0% from 34,837 units in Q2 2024[40] - LiveWire motorcycle shipments were 55 units in Q2 2025, down from 158 units in Q2 2024[34] Operational Metrics - Operating income margin for HDMC was 5.9%, down from 14.7% in Q2 2024, reflecting a 69% decline in operating income[8][9] - Global dealer inventories decreased by 28% compared to Q2 2024, as the company prioritized inventory reduction[6] - The company reported a net cash provided by operating activities of $509,492,000 for the first half of 2025, down from $577,642,000 in the same period of 2024[32] - The company experienced a negative impact of $134 million on gross profit due to manufacturing and other costs in Q2 2025[36] Debt and Financial Strategy - HDFS transaction is valued at approximately 1.75x post-transaction book value, unlocking $1.25 billion in cash, about 40% of current market capitalization[3][6] - HDFS plans to reduce debt by $450 million and accelerate a $1 billion share buyback program, purchasing $500 million in the second half of 2025[3] - HDFS expects operating income of $525-$550 million for the full year 2025 following the transaction[16] Market Conditions and Outlook - The company withdrew its full-year 2025 financial outlook due to uncertain global tariff situations and macroeconomic conditions[14] - The provision for credit losses increased to $49,738 thousand in Q2 2025 from $56,030 thousand in Q2 2024[38] - The balance for receivables allowance for credit losses at the end of Q2 2025 was $399,293 thousand, slightly up from $393,517 thousand at the end of Q2 2024[38] - The company is adjusting its underwriting criteria based on market and economic conditions, which may impact retail credit losses[23]