Harley-Davidson Downshifts on Fourth-Quarter Earnings Miss

Harley-Davidson revs lower after tariffs put a dent in fourth-quarter sales, sparking an earnings miss.
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Shares of iconic motorcycle maker Harley-Davidson  (HOG) - Get Report revved lower on Tuesday after the company posted earnings that missed analysts’ forecasts due to the impact of China and European Union tariffs that took a bite out of U.S. sales.

The Milwaukee-based company said it earned $13.5 million, or 20 cents an adjusted share, in the fourth quarter, vs. $500,000, or 17 cents, in the comparable year-ago period. Analysts polled by FactSet had been expecting earnings of 24 cents a share.

Revenue came in at $1.07 billion, above analysts’ estimates of $922.4 million though below the $1.15 billion in sales it recorded in the fourth quarter of 2018.

U.S. retail sales continued to fall in the fourth quarter, though the pace was more tempered, Harley-Davidson said. U.S. sales also dropped on a full-year basis, though the rate of decline was the lowest since 2016.

International retail sales, meantime, were up slightly in the fourth quarter on the back of continued growth in emerging markets, the company said. Full-year international retail sales finished down 3%.

For the full year, Harley-Davidson earned $423.6 million, or $3.36 an adjusted share, vs. $5.36 billion, or $3.78 an adjusted share, in 2018. Sales were $5.36 billion vs. $5.72 billion in 2018.

For the first quarter of 2020, Harley-Davidson said it is expecting motorcycle segment revenue of about $1.09 billion to $1.17 billion. For full 2020, the company is forecasting revenue of between $4.53 billion to $4.66 billion.

Shares of Harley-Davidson were down 4.1%, or $1.43 a share, at $33.41 in trading on Tuesday.