By Bianca Flowers
(Reuters) – Harley-Davidson Co reported better-than-expected earnings on Tuesday as strong demand for its popular motorcycle models during the summer travel season boosted sales, allaying investor concerns about a slowdown in leisure spending due to high inflation.
Shares of the iconic motorcycle maker rose 2.5% in premarket trading after the company reported a 60% jump in quarterly profit that beat analysts’ estimates.
CEO Jochen Zeitz reaffirmed Harley’s forecast for full-year revenue growth of 5% to 10% for motorcycles and an operating profit margin of 11% to 12% amid strong demand.
“Harley-Davidson delivered a strong third quarter with solid growth in both revenue and operating income,” he said in a statement.
The company has ramped up production to keep popular models readily available as strong holiday and travel demand since the pandemic has filled its order books.
It also doubled its production rates to make up for a two-week shutdown that halted bike shipments in mid-May.
Sales of motorcycles and related products rose about 24% to $1.44 billion in the quarter ended Sept. 25, while operating income from motorcycles and related parts rose 164% year-over-year.
Net income rose to $261 million, or $1.78 per share, from $163 million, or $1.05 per share, a year earlier.
Revenue rose 21% to about $1.65 billion.
(Reporting by Aishwarya Nair in Bengaluru and Bianca Flowers in Chicago; Editing by Sriraj Kaluvilla, Kirsten Donovan)