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Harley-Davidson Still Has Supply-Chain Problems. The Stock Is Falling.Harley-Davidson Still Has Supply-Chain Problems. The Stock Is Falling.Barron's (Online); New York Harley-Davidson stock was falling after the motorcycle maker said its first-quarter operating income declined due to semiconductor shortages and other supply-chain problems. For the March-ended quarter, Harley-Davidson earned $1.45 a share, matching analyst estimates, according to FactSet data. Revenue of $1.5 billion was higher than the $1.3 billion expected by analysts. But operating income or the measure of a company's profit minus expenses declined 16% partly as a result of production challenges due to higher supply chain inflation and production challenges due to semiconductor availability, the company said. Harley-Davidson's (ticker: HOG) stock was down 1.5% to $35.93 in premarket trading on Wednesday. Global retail motorcycle sales were up 2%, but sales in North America were down 5% due to the adverse impact of production shortages, which resulted in significantly lower dealer inventories, Harley-Davidson said. Motorcycle Shipments were flat in the quarter. Management said that it continues "to work through the impact of the ongoing global supply chain disruption, and despite the challenging macro environment, we are optimistic for improvements in the second half of the year." Harley-Davidson is far from being the only motor vehicle company talking about supply chain snarls. Auto and communications component supplier TE Connectivity (TEL) on Wednesday said parts shortages are hampering growth in the current quarter. For the 2022 fiscal year, Harley-Davidson said revenue for its motorcycles and related products segment will grow by 5% to 10%, reaffirming previous estimates. The outlook for the segment's operating income margin was 11% to 12% similar to what had been predicted in February. Besides Motorcycles & Related Products, Harley-Davidson operates through the Financial Service segment, which services retail loans, primarily for the purchase of Harley-Davidson motorcycles. The unit's operating income is expected to decline by 20% to 25% in 2022, as predicted earlier. |
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