Harley-Davidson reported a net income of $354.2 million over the second quarter of 2014, thanks to a 12.4% increase in sales revenue. Actual motorcycle sales volume stayed about even, however, with unit sales increasing to just 90,218 motorcycles from 90,193 sold in the same quarter last year.
Though sales were statistically the same as they were last year, Harley-Davidson generated $1.48 billion in revenue from motorcycle sales alone, up 16.2% from the $1.27 billion reported in the second quarter of 2013. Sales of parts and accessories saw a slight increase while general merchandise (such as clothing) sales continue to shrink. Overall, Harley-Davidson’s second quarter sales revenue increased to $1.83 billion from $1.63 billion.
“Harley-Davidson’s second-quarter results reflect the financial strength of the Company and brand, including the benefits of continuous improvement throughout our operation,” says Keith Wandell, Harley-Davidson chairman, president and chief executive officer. “As a customer-led organization, our employees, dealers in 90 countries and suppliers are focused every day on providing outstanding products and experiences for customers around the world.”
Still, the flat sales are a bit concerning. Outside the U.S., Harley-Davidson saw a drop in sales in Canada and Japan, but increases in other parts of the world including Europe and the rest of Asia. Domestically, however, U.S. sales saw a small decrease to 58,225 motorcycles, down 16 from the same quarter in 2013. Harley-Davidson attributes this to the colder, warmer weather affecting much of the country during the quarter.
“U.S. retail Harley-Davidson sales fell short of our expectations in the second quarter,” says Wandell. “Because we are committed to managing supply in line with demand, we are reducing our full-year shipment plan and now expect shipment growth of approximately 3-1/2 to 5-1/2 percent over last year.”
Harley-Davidson also says Sportster sales took a hit as customers waited for the launch of the new smaller-displacement Street models. Harley-Davidson only started shipping Street models in small numbers late in late June but shipments should increase in the third quarter. Also hurting sales was the absence of the Road Glide from the 2014 product lineup. Harley-Davidson hopes to amend that soon, reiterating the impending return of the shark-nosed touring model as a 2015 model.
For the year-to-date, Harley-Davidson reports a net profit of $620.1 million, up significantly from the $495.9 million reported in the first half of 2013. Looking ahead, Harley-Davidson is decreasing its year-end shipment target to 270,000-275,00 from the previous goal of 279,000-284,000.