Harley-Davidson beat profit expectations on Tuesday as shipments improved from pandemic lows and it reined in costs as part of Chief Executive Officer Jochen Zeitz's restructuring plan, sending its shares up 9% before the bell.
Declines in shipments improved to 6%, or 43,000 motorcycles, from a year earlier and compared with a 59% slump in the prior quarter, indicating a rise in demand for the maker of large cruisers.
Retail sales in its biggest market, the United States, where Harley has not recorded a sales rise for the past six years, fell 10% from a year earlier, but was much less than the 27% slide in the second quarter.
Harley’s sharp recovery from the COVID-19 lows also comes amid CEO Zeitz’s efforts to shut unprofitable markets like India and focus on growth markets such as United States, Europe and parts of Asia-Pacific to lower costs.
Total expenses fell 26% to $196.9 million in the quarter.
In a shift in strategy, Harley announced plans with India's Hero to develop and sell a range of premium motorcycles under the Harley-Davidson brand name, a month after it discontinued its sales and production in the world's largest two-wheeler market.
Net income rose to $120 million, or 78 cents per share, in the third quarter ended Sept. 30, from $87 million, or 55 cents per share, a year earlier. On an adjusted basis, it earned $1.05 cents per share, according to Refinitiv data.
Motorcycles and related product revenue fell to $964 million from $1.07 billion a year earlier.
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