Harley-Davidson (HOG) Q1 2026 earnings summary

Executive summary

• North American retail motorcycle sales rose 14% year-over-year to 23,803 units, driving global retail sales up 8% to 33,507 units, despite a challenging consumer environment.

• Dealer inventory was reduced by 22% year-over-year, improving alignment with retail demand and setting up for the main riding season.

• The new strategic plan, Back to the Bricks, and the RIDE marketing platform received positive early reception, focusing on restoring volume, expanding the portfolio, and strengthening dealer relationships.

• HDMC global motorcycle shipments declined 3% year-over-year; HDMC revenue fell 2% to $1.06 billion.

• $128 million in share repurchases and $22 million in dividends paid during the quarter.

Financial highlights

• Consolidated Q1 2026 revenue declined 12% year-over-year to $1.17 billion, mainly due to a 54% drop in HDFS revenue after transitioning to a capital-light model.

• Q1 consolidated operating income was $23 million, down 85% from Q1 2025; net income was $25 million with a 2.1% margin.

• Q1 EPS was $0.22, compared to $1.07 in the prior year, a 79% decrease.

• HDMC gross profit margin fell to 25.3% from 29.1% year-over-year.

• Operating expenses rose by $49 million, including $15 million in restructuring and $34 million in higher warranty, executive, and marketing costs.

• HDFS Q1 revenue was $112 million (down 54%), with operating income of $22 million and a 19.9% margin.

• LiveWire segment revenue increased 87% year-over-year to $5 million, with operating loss improving by 11%.

• Net cash used in operating activities was $228 million, compared to $142 million of cash generated in Q1 2025; cash and equivalents at quarter-end were $1.8 billion.

Outlook and guidance

• 2026 guidance reaffirmed: HDMC retail and wholesale units expected at 130,000–135,000.

• Shipments projected higher in Q2 and Q4, flat in Q3; production units to be lower than wholesale as inventory is managed.

• Tariff costs for 2026 forecast at $75–$90 million, down from prior guidance.

• HDMC operating income expected between $10 million profit and a $40 million loss; HDFS operating income $45–$60 million; LiveWire operating loss $70–$80 million.

• Capital investment planned at $175–$200 million for 2026.

• Medium-term targets: mid-single-digit retail unit growth, gross margins approaching 30%, operating expenses below 20% of sales, and 10–12% EBITDA margin.

• Path to $350 million+ EBITDA by 2027, driven by cost reduction, portfolio expansion, and improved dealer economics.