Harley-Davidson Stock Soars 13.46% on Strategic Partnership

Harley-Davidson's stock surged by 13.46% in pre-market trading on July 30, 2025, driven by a strategic partnership with KKR and PIMCO for its financial services subsidiary, HDFS. This transaction is expected to unlock $1.25 billion in cash, which the company plans to use to reduce debt and accelerate its share buyback program.

Despite the positive market reaction, Harley-Davidson's second-quarter financial results were impacted by a challenging commercial environment and uncertain tariff situation. The company reported a 19% decline in consolidated revenue, driven largely by a 23% decrease in HDMC revenue. Global motorcycle shipments decreased by 28%, and retail sales were down 15% year-over-year, reflecting soft demand and unfavorable consumer confidence due to high-interest rates and economic uncertainty.

The strategic partnership with KKR and PIMCO values the HDFS business at approximately 1.75x post-transaction book value. HDFS will sell a 4.9% common equity interest to investment vehicles managed by KKR and PIMCO and will sell approximately two-thirds of its future retail loan originations at a premium on an annual basis for five years. This transaction is expected to optimize HDFS's capital structure and position it to better serve customers and dealers.

Harley-Davidson's LiveWire segment, which focuses on electric motorcycles, also faced challenges. Electric motorcycle unit sales decreased by 65%, and revenue was down 7% year-over-year. However, the operating loss improved by $10 million, which was 34% lower than the prior year's loss.