Shares of Harley-Davidson have experienced a significant decline following the motorcycle maker's report of lower sales in the third quarter. Executives have also noted that some customers are struggling with their finances, further impacting the company's performance.

In morning trading, the stock fell nearly 10% to $26.05, continuing its downward trend throughout the year with a 38% decrease. Production issues and concerns regarding consumer discretionary spending have contributed to this decline.

Harley-Davidson reported a 20% decrease in motorcycle shipments for the third quarter, which led to a 9% drop in revenue for their bike, parts, and apparel unit. The revenue generated by this unit was $1.3 billion, falling below analysts' expectations of $1.36 billion according to FactSet.

Despite these challenges, Harley-Davidson's quarterly profit came in at $1.38 per share, exceeding analysts' predictions by two cents.

Factors such as rising interest rates and persistently high inflation have dampened demand for Harley's motorcycles. Chief Commercial Officer Edel O'Sullivan stated that many customers are refraining from making discretionary purchases in 2023.

In addition to motorcycle sales, Harley-Davidson also provides financing options to its customers. However, a higher provision for credit losses has impacted the operating profit of their financing unit. Chief Financial Officer Jonathan Root expressed concerns about both increased realized credit losses and delinquencies, signaling a more stressed consumer base.

In light of these developments, Harley-Davidson faces significant challenges as it navigates through an increasingly competitive and uncertain market.

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