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HOG Q1 Earnings Miss Estimates on Tariff-Pressured Margins
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Key Takeaways
HOG Q1 EPS fell to 22 cents, missing estimates as operating margin slid to 2% from 12.1%.
Harley-Davidson says new or higher tariffs, incentives and mix drove HDMC margin drop to 1.8%.
HOG reaffirmed 2026 outlook. Retail and shipments expected to be 130k-135k & HDMC op income -$40M to $10M.
Harley-Davidson, Inc. (HOG - Free Report) reported first-quarter 2026 earnings of 22 cents per share, missing the Zacks Consensus Estimate of 34 cents by 36.1%. Earnings also dropped 79% from $1.07 a year ago.
Profitability deteriorated sharply despite the revenue beat. Harley-Davidson posted consolidated operating income of $23 million versus $160 million in the year-ago quarter, pushing operating margin down to 2% from 12.1%. Net income attributable to the company fell to $25 million from $133 million, reflecting pressure across key segments.
Revenues at Harley-Davidson Motor Company (HDMC) came in at $1,055 million, which declined 2% year over year but topped the Zacks Consensus Estimate of $958 million by 10.7%. The quarter featured a 22% year-over-year reduction in global dealer inventory of new motorcycles, underscoring the company’s push to better align wholesale with retail demand.
Harley-Davidson Sees Retail Growth Across Key Markets
Demand indicators were better than the income statement suggests. Global retail motorcycle sales rose 8% year over year to 33,507 units, led by North America, where retail sales increased 14% to 23,803 units. The company cited strength in the United States, particularly in the Touring category, along with a favorable response to the 2026 motorcycle lineup.
Outside North America, results were softer. EMEA retail sales declined 3% year over year, while Asia Pacific fell 9%. Latin America was a bright spot, with retail up 21%, supported by gains in Brazil and Mexico. Management also pointed to encouraging early reception of its new RIDE marketing platform and said it is preparing to activate its “Back to the Bricks” growth strategy.
HOG’s HDMC Margin Hit by Tariffs and Incentives
Revenues from HDMC decreased 2% to $1,055 million as global motorcycle shipments slipped 3% to 37,295 units. Within HDMC, motorcycle revenues fell 3% to $836 million, parts and accessories dipped 1% to $142 million, and apparel was flat at $57 million, reflecting a mixed top-line backdrop.
The bigger issue was margin compression. HDMC's gross margin declined to 25.3% from 29.1% and its operating margin dropped to 1.8% from 10.8% a year earlier. The company attributed the deterioration to the cost of new or increased tariffs, the net effect of global pricing actions and sales incentives, and unfavorable product mix, partially offset by favorable foreign currency and an EU-related tariff refund tied to a favorable court judgment. Operating expenses rose $49 million year over year, including the $15 million restructuring expense recorded during the quarter.
Harley-Davidson Financial Services Revenues Drop
HDFS posted revenues of $112 million, down 54% year over year, while operating income declined 65% to $22 million.
The company linked the revenue decline to lower retail and wholesale finance receivables at lower yields. It also noted that the reduction in retail receivables reflected loan-asset sales tied to the HDFS transaction completed in the second half of 2025. Offsetting items included improved “other income” from new servicing fees, investment income and gains on third-party loan sales. Total quarter-end net finance receivables (retail plus wholesale) were $2.4 billion, down 67% from the prior year.
HOG’s LiveWire Sees Improved Results
In the quarter under review, LiveWire revenues rose to $5 million from $3 million, an 87% increase, driven by higher electric motorcycle unit sales and increased STACYC electric balance bike sales.
LiveWire’s operating loss narrowed to $18 million from $20 million a year ago, reflecting better gross margin on higher revenues and lower selling, administrative and engineering expenses.
HOG’s Financial Position & Capital Returns
In the first quarter, selling, general and administrative expenses from the HDMC unit increased to $248.1 million from $199 million in the year-ago quarter. Harley-Davidson had cash and cash equivalents of $1.8 billion as of March 31, 2026. The long-term debt decreased to $1.13 billion from $1.65 million recorded as of Dec. 31, 2025. Net cash used in operating activities was $228 million.
The company paid dividends of 22 million and repurchased $128 million worth of shares on a discretionary basis in the first quarter of 2025.
HOG Reaffirms 2026 Guidance
For full-year 2026, Harley-Davidson reaffirmed expectations for HDMC global motorcycle retail sales of 130,000-135,000 units and wholesale shipments of 130,000-135,000 units. It continues to project HDMC operating income ranging from a $40 million loss to a $10 million profit, HDFS operating income of $45-$60 million and LiveWire operating loss of $70-$80 million, with capital investments of $175-$200 million.
Key Releases From the Auto Space
General Motors (GM - Free Report) delivered first-quarter 2026 adjusted earnings of $3.70 per share, which rose 33% year over year and topped the Zacks Consensus Estimate of $2.61. Revenues of $43.62 billion slipped 0.9% year over year and missed the consensus mark of $43.94 billion by 0.7%. Management increased full-year 2026 EBIT-adjusted guidance to $13.5-$15.5 billion (versus $13-$15 billion guided earlier) and lifted its adjusted earnings outlook to $11.50-$13.50 per share (compared with the prior forecast of $11-$13 per share). General Motors now expects gross tariff costs of $2.5-$3.5 billion in 2026, down from the prior forecast of $3-$4 billion, while maintaining its adjusted automotive free cash flow target of $9-$11 billion.
Ford (F - Free Report) reported first-quarter 2026 adjusted earnings per share of 66 cents, which beat the Zacks Consensus Estimate of 20 cents and increased from 14 cents in the prior-year quarter. Ford’s total automotive revenues rose 6.4% year over year to $39.82 billion, which surpassed the Zacks Consensus Estimate of $39.34 billion by 1.21%. The company’s consolidated first-quarter revenues came in at $43.3 billion, up 6.4% year over year. Ford raised full-year 2026 adjusted EBIT guidance to $8.5-$10.5 billion, up from $8-$10 billion. It reiterated its adjusted free cash flow outlook at $5-$6 billion.
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HOG Q1 Earnings Miss Estimates on Tariff-Pressured Margins
Key Takeaways
Harley-Davidson, Inc. (HOG - Free Report) reported first-quarter 2026 earnings of 22 cents per share, missing the Zacks Consensus Estimate of 34 cents by 36.1%. Earnings also dropped 79% from $1.07 a year ago.
Profitability deteriorated sharply despite the revenue beat. Harley-Davidson posted consolidated operating income of $23 million versus $160 million in the year-ago quarter, pushing operating margin down to 2% from 12.1%. Net income attributable to the company fell to $25 million from $133 million, reflecting pressure across key segments.
Revenues at Harley-Davidson Motor Company (HDMC) came in at $1,055 million, which declined 2% year over year but topped the Zacks Consensus Estimate of $958 million by 10.7%. The quarter featured a 22% year-over-year reduction in global dealer inventory of new motorcycles, underscoring the company’s push to better align wholesale with retail demand.
HOG currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Harley-Davidson, Inc. Price, Consensus and EPS Surprise
Harley-Davidson, Inc. price-consensus-eps-surprise-chart | Harley-Davidson, Inc. Quote
Harley-Davidson Sees Retail Growth Across Key Markets
Demand indicators were better than the income statement suggests. Global retail motorcycle sales rose 8% year over year to 33,507 units, led by North America, where retail sales increased 14% to 23,803 units. The company cited strength in the United States, particularly in the Touring category, along with a favorable response to the 2026 motorcycle lineup.
Outside North America, results were softer. EMEA retail sales declined 3% year over year, while Asia Pacific fell 9%. Latin America was a bright spot, with retail up 21%, supported by gains in Brazil and Mexico. Management also pointed to encouraging early reception of its new RIDE marketing platform and said it is preparing to activate its “Back to the Bricks” growth strategy.
HOG’s HDMC Margin Hit by Tariffs and Incentives
Revenues from HDMC decreased 2% to $1,055 million as global motorcycle shipments slipped 3% to 37,295 units. Within HDMC, motorcycle revenues fell 3% to $836 million, parts and accessories dipped 1% to $142 million, and apparel was flat at $57 million, reflecting a mixed top-line backdrop.
The bigger issue was margin compression. HDMC's gross margin declined to 25.3% from 29.1% and its operating margin dropped to 1.8% from 10.8% a year earlier. The company attributed the deterioration to the cost of new or increased tariffs, the net effect of global pricing actions and sales incentives, and unfavorable product mix, partially offset by favorable foreign currency and an EU-related tariff refund tied to a favorable court judgment. Operating expenses rose $49 million year over year, including the $15 million restructuring expense recorded during the quarter.
Harley-Davidson Financial Services Revenues Drop
HDFS posted revenues of $112 million, down 54% year over year, while operating income declined 65% to $22 million.
The company linked the revenue decline to lower retail and wholesale finance receivables at lower yields. It also noted that the reduction in retail receivables reflected loan-asset sales tied to the HDFS transaction completed in the second half of 2025. Offsetting items included improved “other income” from new servicing fees, investment income and gains on third-party loan sales. Total quarter-end net finance receivables (retail plus wholesale) were $2.4 billion, down 67% from the prior year.
HOG’s LiveWire Sees Improved Results
In the quarter under review, LiveWire revenues rose to $5 million from $3 million, an 87% increase, driven by higher electric motorcycle unit sales and increased STACYC electric balance bike sales.
LiveWire’s operating loss narrowed to $18 million from $20 million a year ago, reflecting better gross margin on higher revenues and lower selling, administrative and engineering expenses.
HOG’s Financial Position & Capital Returns
In the first quarter, selling, general and administrative expenses from the HDMC unit increased to $248.1 million from $199 million in the year-ago quarter. Harley-Davidson had cash and cash equivalents of $1.8 billion as of March 31, 2026. The long-term debt decreased to $1.13 billion from $1.65 million recorded as of Dec. 31, 2025. Net cash used in operating activities was $228 million.
The company paid dividends of 22 million and repurchased $128 million worth of shares on a discretionary basis in the first quarter of 2025.
HOG Reaffirms 2026 Guidance
For full-year 2026, Harley-Davidson reaffirmed expectations for HDMC global motorcycle retail sales of 130,000-135,000 units and wholesale shipments of 130,000-135,000 units. It continues to project HDMC operating income ranging from a $40 million loss to a $10 million profit, HDFS operating income of $45-$60 million and LiveWire operating loss of $70-$80 million, with capital investments of $175-$200 million.
Key Releases From the Auto Space
General Motors (GM - Free Report) delivered first-quarter 2026 adjusted earnings of $3.70 per share, which rose 33% year over year and topped the Zacks Consensus Estimate of $2.61. Revenues of $43.62 billion slipped 0.9% year over year and missed the consensus mark of $43.94 billion by 0.7%. Management increased full-year 2026 EBIT-adjusted guidance to $13.5-$15.5 billion (versus $13-$15 billion guided earlier) and lifted its adjusted earnings outlook to $11.50-$13.50 per share (compared with the prior forecast of $11-$13 per share). General Motors now expects gross tariff costs of $2.5-$3.5 billion in 2026, down from the prior forecast of $3-$4 billion, while maintaining its adjusted automotive free cash flow target of $9-$11 billion.
Ford (F - Free Report) reported first-quarter 2026 adjusted earnings per share of 66 cents, which beat the Zacks Consensus Estimate of 20 cents and increased from 14 cents in the prior-year quarter. Ford’s total automotive revenues rose 6.4% year over year to $39.82 billion, which surpassed the Zacks Consensus Estimate of $39.34 billion by 1.21%. The company’s consolidated first-quarter revenues came in at $43.3 billion, up 6.4% year over year. Ford raised full-year 2026 adjusted EBIT guidance to $8.5-$10.5 billion, up from $8-$10 billion. It reiterated its adjusted free cash flow outlook at $5-$6 billion.