Harley-Davidson reported net income of $127.9 million on revenue of $1.38 billion for the first quarter, down from net income of $174.8 million and consolidated revenue of $1.54 billion a year ago, but the company beat expectations for profit by more than 30 cents per share and upheld its shipment forecasts for 2019. Some analysts said they expected shipment forecasts to be reduced.
The company reported earnings per share, excluding items, of 98 cents, compared with the average analyst estimate of 65 cents per share, according to IBES data from Refinitiv.
Earlier this year, Harley-Davidson said the EU tariffs would cost it between $100 million and $120 million in 2019. EU tariffs increased from 6% to 31% last June and are set to increase to 56% in 2021. Chinese tariffs on the bikes increased from 30% to 55%.
The earnings beat prompted a Tweet from President Donald Trump, who called EU tariffs unfair to the U.S., adding, “We will Reciprocate!”
President Trump last year seemed to support a boycott against Harley-Davidson after the company said it was moving some production out of the U.S. in response to retaliatory tariffs that followed Trump administration tariffs on steel and aluminum imports.
“We are acting with agility and discipline to take full advantage of rapidly evolving global markets. Harley-Davidson’s U.S. market share growth and retail sales performance in the first quarter are further evidence of the effects we are having as we continue to implement and dial-in our More Roads efforts,” CEO Matt Levatich said in a statement. “We are driven by our unparalleled rider focus and deep analytics that are guiding our efforts today and into the future. We, along with our dealers, are determined to lead and stimulate global industry growth.”
Harley-Davidson said revenue from motorcycles and related products was $1.19 billion, down 12.3% from a year earlier. Sales in Europe were down by 2.1%.
Harley shares were up modestly in midday trading.