Polaris reports sales drop for Q4 and FY24

Polaris Inc. has released its fourth quarter and full-year 2024 results. For the fourth quarter, the company reported worldwide sales of $1,755 million, down 23 percent versus the fourth quarter of 2023. Some of the highlights for the quarter included:

• North America sales of $1,481 million represented 84 percent of total company sales and decreased 26 percent from $1,995 million in 2023. The North American market share was flattish across all three segments;
• International sales of $274 million represented 16 percent of total sales and decreased seven percent versus the fourth quarter of 2023; and
• Due to planned shipment reductions, lower volumes impacted total sales in Q4 as the company managed dealer inventory in a soft retail environment.

Polaris’ Q4 net income decreased 90 percent compared to the fourth quarter of 2023. Adjusted net income attributable for the quarter was $52 million, down 54 percent compared to Q4 2023. The Minnesota-based manufacturer’s gross profit margin decreased 44 basis points to 20.4 percent for Q4 versus 2023. The adjusted gross profit margin of 21.1 percent increased by nine basis points were mostly driven by lean operational strategies.

Polaris reported that operating expenses were $318 million in the fourth quarter compared to $357 million in the fourth quarter of 2023 due to a lower cost spend across the business. Operating expenses, as a percentage of sales, of 18.1 percent were up 254 basis points in the fourth quarter of 2024 compared to Q4 of 2023.

CEO Comments

Amid a tough year for the powersports industry, I’m proud of the Polaris team’s disciplined focus on making progress within the areas we can control. We were relentless in our efforts, resulting in continued innovation leadership with our products, a 16-percent reduction in ORV dealer inventory, and an operational efficiency savings goal exceeding over $100 million. Polaris has weathered storms before, and we believe we are positioning our organization to emerge from this downcycle even stronger. While I anticipate challenging headwinds will carry forward into 2025, we will remain focused on being a strong partner to our dealers, providing our riders with high quality products and working to deliver long-term value to shareholders.

–Mike Speetzen, Chief Executive Officer of Polaris Inc.

Off Road segment:

• Sales were driven by lower volume due to planned shipment reductions as we actively managed dealer inventory in a subdued retail environment;
• Parts, Garments, and Accessories (PG&A) sales decreased by 13 percent;
• Gross profit margin performance was driven by operational efficiencies and lower costs, somewhat offset by negative mix, finance interest, and absorption; and
• Polaris North America ORV unit retail sales were flat. Estimated North American industry ORV unit retail sales were up mid-single digits percent.

On-Road segment:

• Sales were driven by lower volumes;
• PG&A sales decreased 15 percent;
• Gross profit margin performance was driven by a favorable comparable last year and operational efficiencies, partially offset by a mixed headwind; and
• North America unit retail sales for Indian Motorcycle were flat. Estimated North American unit retail sales for the comparable motorcycle industry were down by a high-single-digit percentage.

Marine segment:

• Sales were driven by lower volume due to planned shipment reductions as we actively managed dealer inventory in a subdued retail environment; and
• Gross profit margin performance was impacted by a decrease in sales volumes, resulting in decreased leverage of manufacturing costs.

2025 Outlook

Polaris expects 2025 sales to be down one to four percent versus 2024. The company expects margin headwinds from the negative mix, planned reductions in production leading to negative absorption, in addition to the restoration of the company’s employee profit-sharing program. These are expected to be somewhat offset by continued progress with Polaris’s lean and efficient operations strategy.