DOW JONES NEWSWIRES Harley-Davidson Inc.'s (HOG) third-quarter earnings dropped 84%, falling short of analyst estimates, as the motorcycle maker continued to suffer from slowed sales during the economic downturn.
The company also said it will discontinue its Buell product line and divest its MV Agusta unit as part of its strategy to become more profitable.
Shares fell 3.6% premarket to $25.31.
As motorcycle demand has dropped during the recession, Harley-Davidson has been forced to cut costs and slash jobs. Sales have slowed, and the company in July cut back its forecast for shipments through the end of the year.
But Harley-Davidson said Thursday that demand may be picking up slightly as sales declined less in the third quarter than in the second.
"While the environment remains challenging for us, we are mildly encouraged by the moderation in the decline of dealer retail Harley-Davidson motorcycle sales," said Chief Executive Keith Wandell, who assumed the office in May.
The company reported a third-quarter profit of $26.5 million, or 11 cents a share, down from $166.5 million, or 71 cents, a year earlier. Revenue decreased 21% to $1.12 billion.
Analysts polled by Thomson Reuters had forecast earnings of 21 cents on $1.1 billion in revenue.
Worldwide motorcycle retail sales fell 21% to 63,729 units, with U.S. sales dropping 24%.
The company said Thursday it expects to ship 222,000 to 227,000 motorcycles to dealers for the year, including 35,000 to 40,000 during the fourth quarter. The 2009 view is the high end of July's sharply reduced target.
Harley-Davidson's financial services segment, which was wrecked by the credit crunch, swung into the red.