Harley-Davidson sells a $5 billion loan portfolio. Tariff headwinds last

Nathan Gomez

(Reuters) – Harley Davidson’s shares rose more than 20% on Wednesday after announcing more than $5 billion in loans and Pimco sales.

However, motorcycle manufacturers reported quarterly profits below estimates, withholding annual tariff forecasts, and focused on a $17 million hit in the first half of the year.

“Despite the EPS mistake, the stocks were traded in a higher market as investors focused on the positive trading aspects. In our view, the trading is positive, but HOG faces major headwinds.”

Harley plans to cut debt by $450 million in transactions while retaining full control of the financial sector and majority ownership.

The deal is expected to close later this year, and will likely generate $1.25 billion in cash, the company added.

Demand for leisure vehicles is declining in the US, and consumers are rethinking non-essential purchases in an uncertain economy. Harley also struggles to acquire younger riders who prefer fuel-efficient models with the latest safety features.

On Wednesday, the legacy motorcycle manufacturer confirmed the launch of a small, “sprint” model, targeting the US and international markets with targeted entry prices under $6,000.

Reuters’ calculations show that between February and now, nearly 100 US companies have either withdrawn or cast financial plans by removing financial plans from the consumer and automobile and transportation sectors.

Rival Polaris, which owns “Indian” branded motorcycles, also hindered year-round guidance.

In May, the company said it was assessing investments in its financial sector.

Harley-Davidson’s profits fell to $188 million (88 cents per share) in the second quarter, down to $228 million ($1.63 per share) a year ago.

Analysts were on average expecting a profit of 96 cents per share, according to data compiled by LSEG.

(Reporting by Nathan Gomez of Bengaluru, edited by Maju Samuel)