What happened
Shares of Harley-Davidson (HOG -15.74%) were riding their second straight day of double-digit gains on Wednesday after reporting earnings that beat analyst expectations.
The motorcycle maker's stock was up over 11% in afternoon trading as investors hoped that plans for a narrower focus in its growth ambitions would actually pay off.
The Bronx streetfighter is one of the new class of motorcycles Harley-Davidson is looking to turn its business around. Image source: Harley-Davidson.
So what
The quarter was actually yet another disastrous one as the COVID-19 pandemic caused motorcycle sales to virtually disappear overnight. Harley said it had been on track to post near-7% gains through January and February in the U.S., but when the crisis struck, sales plummeted and ended up being down 15% from the year-ago period.
Yet there seems to be a ray of hope that the company had finally reached bottom if the coronavirus outbreak had not intervened.
Now what
Harley plans to revise its strategic outlook so it isn't as broad-based as its previous More Roads plan. Although the bike maker released few details, the new Rewire plan will focus primarily on key markets and products that are profitable, while maintaining its dominant presence in the U.S.
Acting president and CEO Jochen Zeitz said, "COVID-19 has dramatically changed our business environment, and it is critical we respond with agility to this new reality." Investors seem hopeful this means it will return more to its roots and be less expansive in its global ambitions.
