Adjustments for Non-Cash Items (USD, thousands)

Stock-Based Compensation (USD, thousands)

Changes in Working Capital (USD, thousands)

Capital Expenditures (CapEx) (USD, thousands)

Proceeds from / Repayments of Debt (USD, thousands)

Share Repurchases (USD, thousands)

Dividend Payments (USD, thousands)

Net Change in Cash (USD, thousands)

2ea7690744c7f6dc31e62a954f7aeb6cb3cbc1b9c6ac96ab3cfc5c02d7b60144

5b53d6a31f09b1ec894e8e499c18e2e6311715629c74a9e5383cb176d6986c28

d0d457bce5ab0a6991073347df6c52b0ed61f5e051233507038e42ca9dd84da7

7a1234c9ace431beaab59b7b2857c88b07e96126e95d8318b5ea803e1a0c3864

Revenue (USD, thousands)

Motorcycles and related products Revenue (USD, thousands)

Financial services Revenue (USD, thousands)

Motorcycles and related products cost of goods sold (USD, thousands)

Financial services interest expense (USD, thousands)

Financial services provision for credit losses (USD, thousands)

Selling, administrative and engineering expense (USD, thousands)

Operating income (USD, thousands)

Other income, net (USD, thousands)

Investment income (USD, thousands)

Interest expense (USD, thousands)

Income before income taxes (USD, thousands)

Income tax provision (USD, thousands)

Net income (USD, thousands)

Loss attributable to noncontrolling interests (USD, thousands)

Net income attributable to Harley-Davidson, Inc. (USD, thousands)

Basic earnings per share attributable to Harley-Davidson, Inc. (USD)

Diluted earnings per share attributable to Harley-Davidson, Inc. (USD)

Cash dividends per share (USD)

8652da5ded8120d94bcea0a3ab0f568df95f1076aa00a9dbd48c5e6301b45b84

The sharp drop in operating income in Q4 2023 was driven by **multiple factors**. First, **lower wholesale volumes** played a major role, as global motorcycle shipments dropped by **13%** under prudent inventory management.  **[HOG_3372474_5]** **[0000793952-24-000044_a8kq42023exhibit991.htm:1]**  Additionally, the company increased **incentive spending** to support the sell-through of 2023 models, which reduced revenue by about **$40 million** in Q4.  **[HOG_3372474_6]**  Rising **manufacturing costs** coupled with lower shipment volumes led to a **360 basis point decline in gross margins, down to 22.9%**.  **[HOG_3372474_6]** **[0000793952-24-000044_a8kq42023exhibit991.htm:1]**  Moreover, there were **segment-specific losses**—HDMC incurred an operating loss of **$44 million** (up from a $32 million loss in the previous year)  **[HOG_3372474_5]** **[0000793952-24-000044_a8kq42023exhibit991.htm:1]** , while the LiveWire segment experienced an operating loss of **$35 million** due to planned development costs.  **[HOG_3372474_7]** **[0000793952-24-000044_a8kq42023exhibit991.htm:0]**  Finally, a **decline in consolidated revenue by 8%** further contributed to the drop in operating income.  **[HOG_3372474_5]** **[0000793952-24-000044_a8kq42023exhibit991.htm:0]** 

Why did Operating income drop so sharply in Q4 2023?

The steep decline in Basic EPS for Q4 2023 was primarily driven by a **significant drop in net income**. **Net income attributable to Harley-Davidson, Inc. fell from **$41.9 million** in Q4 2022 to **$25.8 million** in Q4 2023, representing an approximate **38% decline**.  **[HOG_3372474_5]** **[HOG_3372474_6]** **[0000793952-24-000044_a8kq42023exhibit991.htm:0]**  This drop was mainly attributed to several factors:  

- A **14% decline in revenue** at the HDMC segment due to **lower wholesale motorcycle shipments** and **higher incentive spending**.  **[HOG_3372474_5]** **[HOG_3372474_6]** **[0000793952-24-000044_a8kq42023exhibit991.htm:0]**   
- Worsening operating losses at HDMC, which expanded from **$32.0 million** in Q4 2022 to **$44.2 million** in Q4 2023.  **[0000793952-24-000044_a8kq42023exhibit991.htm:8]**   
- A **10% decline in operating income** at Harley-Davidson Financial Services (HDFS), driven by **higher borrowing costs** and increased **credit loss provisions**.  **[HOG_3372474_7]**   
- Increased operating losses at the LiveWire segment, rising from **$28.6 million** to **$34.9 million**.  **[0000793952-24-000044_a8kq42023exhibit991.htm:8]**   

Even though share buybacks reduced the weighted-average shares outstanding, the combined negative impact of these factors led to the pronounced decline in Basic EPS.  **[HOG_3372474_8]** **[0000793952-24-000044_a8kq42023exhibit991.htm:8]** 

What caused the steep decline in Basic EPS in Q4 2023?

In Q4 2023, **Harley-Davidson's** net income declined significantly—by **38%** compared to Q4 2022—due to multiple factors. The company experienced an **8% overall revenue decline**, driven in part by a **14% drop** in HDMC revenue, compounded by lower wholesale units shipped (a **13% decrease**) and significant **incentive spend**. Moreover, the consolidated operating result turned into a **$21 million loss**, largely due to a **$44 million loss** in HDMC, a decline in operating income at HDFS driven by **higher borrowing costs**, increased credit loss provisions, and elevated operating expenses, as well as a **$35 million loss** in the LiveWire segment.  **[0000793952-24-000044_a8kq42023exhibit991.htm:8]** **[0000793952-24-000044_a8kq42023exhibit991.htm:0]** **[HOG_3372474_5]** **[HOG_3372474_7]** 

What led to the significant drop in Net income in Q4 2023?

The drastic decrease in operating income in Q3 2024 was mainly driven by the decline in the **HDMC segment**, which saw its operating income fall by **$120,116 thousand** (a **68.5% decline**) due to a **39% drop in motorcycle shipments**, lower production volumes resulting in unfavorable manufacturing leverage, and a shift toward **lower-margin markets** compounded by moderate inflation and weaker foreign currency exchange rates.  **[0000793952-24-000155_a8kq32024exhibit991.htm:0]** **[20241024CG39061:0]** **[0000793952-24-000165_hog-20240930.htm:58]**  Additionally, the **LiveWire segment** experienced a slight increase in its operating loss, and while the **HDFS segment** improved its operating income, these factors were not enough to offset the significant losses in the HDMC segment.  **[0000793952-24-000155_a8kq32024exhibit991.htm:0]** **[20241024CG39061:0]** **[0000793952-24-000165_hog-20240930.htm:58]** **[0000793952-24-000165_hog-20240930.htm:59]** 

Why did Operating income fall so drastically in Q3 2024?

The drop in revenue in Q3 2024 was primarily driven by a significant decline in the **Harley-Davidson Motor Company (HDMC)** segment. **HDMC** revenue fell by **32%**, largely due to a **39% decrease** in wholesale motorcycle shipments as the company strategically adjusted dealer inventory levels in response to the changing retail environment. Additionally, there was a **6% decline** in Parts & Accessories revenue driven by lower customer traffic, although this was partially offset by a **10% revenue increase** in the Financial Services segment due to higher retail and commercial finance receivables and improved average yields.  **[0000793952-24-000155_a8kq32024exhibit991.htm:0]** **[20241024CG39061:0]** **[0000793952-24-000165_hog-20240930.htm:58]** 

What drove the drop in Revenue in Q3 2024?

3f0275652e3309d57cb9699ba48582ccfbb90e9dc5f62a0fcd46d07cb82b520e

The jump in **cash and cash equivalents** in Q3 2024 was driven primarily by a significant increase in **net cash provided by operating activities**, which reached **$930,655 thousand** due to improvements in working capital management (such as reductions in inventory and accounts receivable) and lower net cash outflows for wholesale finance receivables. In addition, a slightly lower cash outflow in investing activities and higher cash inflows from financing activities—including proceeds from securitization debt and other financing measures—also contributed to the increase, along with a minor positive impact from exchange rate changes.  **[0000793952-24-000155_a8kq32024exhibit991.htm:9]** **[0000793952-24-000165_hog-20240930.htm:66]** **[HOG_3403657_6]** 

Why did Cash and cash equivalents jump in Q3 2024?

The reduction in **Long-term debt, net** in Q3 2024 was mainly driven by **repayments of medium-term notes**, significant **securitization debt activities**—including **repayments of $782,161 thousand** and **proceeds of $1,145,211 thousand**—and an overall strategic focus on **debt reduction** across the company's balance sheet.  **[0000793952-24-000155_a8kq32024exhibit991.htm:9]** 

What factors contributed to the lower Long-term debt, net in Q3 2024?

The significant drop in short-term debt in Q2 2024 was primarily attributed to a net decrease in unsecured commercial paper, which reduced by **$(379,743) thousand** during the first half of 2024, thereby driving the overall decline in the debt figure.  **[0000793952-24-000150_hog-20240630.htm:27]** **[0000793952-24-000150_hog-20240630.htm:5]** **[0000793952-24-000147_a8kq22024exhibit991.htm:9]** **[0000793952-24-000150_hog-20240630.htm:6]** **[0000793952-24-000150_hog-20240630.htm:63]** 

What led to the significant drop in Short-term debt in Q2 2024?

The current portion of long-term debt nearly doubled in Q3 2024 because Harley-Davidson reclassified a significant amount of its long‑term debt as current liabilities as those obligations neared their maturity dates. Specifically, maturing medium‑term notes (including a €600 million note issued in November 2019), asset‑backed securitization debt, and an overall shortened debt maturity structure all contributed to the increase.  **[0000793952-24-000165_hog-20240930.htm:5]** **[0000793952-24-000155_a8kq32024exhibit991.htm:9]** **[0000793952-24-000165_hog-20240930.htm:46]** 

Why did the current portion of long-term debt nearly double in Q3 2024?

652964b57c8a2911a8bf8af8387dd27234d4c6319a6ef40f4fb35439b5d8f3af

Harley-Davidson Inc (HOG)

Financials