Harley-Davidson reported a deeper loss in the fourth quarter, the motorcycle maker said on Tuesday, as a pullback in consumer spending on recreational vehicles and tariffs on critical imports pressured both volumes and margins. The companys shares fell about 6% in premarket trading on the results.
For the quarter, Harley recorded a net loss of $279 million, or $2.44 per share, compared with a net loss of $117 million, or $0.93 per share, in the same period a year earlier. Total revenue for the quarter dropped 28% to $496 million.
Management attributed part of the profit squeeze to lower volumes and higher costs tied to tariffs on imported components, including semiconductors used in modern motorcycles. The companys gross margin declined by 3.8 percentage points in 2025 versus the prior year, with tariffs and reduced sales cited as key drivers of the deterioration.
Harley-Davidson has relied in part on cost reductions to protect margins and has focused sales toward higher-margin touring and custom motorcycles, which tend to appeal to wealthier buyers. At the same time, the brand has been working to broaden its customer base: last year the company announced plans for a smaller, lower-priced model called the "Sprint," targeted for a 2026 launch with an intended entry price below $6,000, aimed at attracting entry-level and younger riders.
"We close out a challenging year for the company, we are taking deliberate actions to stabilize the business, restore dealer confidence, and align wholesale activity with retail demand, said Harley-Davidson CEO Artie Starrs.
The results underscore how inflationary pressure on household budgets has led some consumers to reconsider discretionary purchases such as motorcycles. Harley said it is aligning wholesale shipments with retail demand and taking actions intended to stabilize performance and dealer relationships as it navigates the current sales environment.
Market reaction and context
Shares fell in premarket trading following the announcement, reflecting investor concern about the magnitude of the loss and the sharp revenue contraction. Management is steering the company through softer consumer spending and the operational impact of tariffs, while preparing for the launch of the lower-priced Sprint model in 2026 as a potential avenue to reach new riders.
What management is emphasizing
- Stabilizing the business through deliberate actions to align wholesale activity with retail demand.
- Restoring dealer confidence after a period of softer volumes.
- Expanding the product lineup with a lower-priced entry model to attract new and younger customers.