Polaris Is Doing Great, Actually

You know what the people want? Things that actually work.

Photo by: Polaris

By: Jonathon Klein

Nov 3, at 9:54am ET

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If you pay attention to the business side of the powersports industry as RideApart does, you'll undoubtedly know that much of it remains underwater. Well, somewhat underwater, as most have either just eeked by in terms of sales this year, or are only slightly below their wanted targets. This is due to a variety of reasons, but is mostly tied to how bad the economy is for normal people.

No, the stock market doesn't count, as most average people aren't playing in it, nor have the ability to invest with our stagnant wages.

Who isn't doing badly, however, is Polaris. In fact, they're not just not doing badly; the Minnesota-based company has seen its profits actually rise a whopping 11%. What's everyone buying? Not so shockingly, it's the brand's utility-based products. No, not the go-fast, take-names, high-dollar stuff—though they are selling those, too—but the vast majority are the vehicles designed to get the job done at a reasonable price.

Who could've guessed people still need to get dirty?

The news comes on the heels of Polaris' Q3 earnings report, which saw the company state that it had made $2.04 billion. Again, that's up 11% year-over-year. According to Powersport Business's report on the Q3 earnings, "Polaris returned to a quarterly net profit of $38.4 million, compared with a $16 million loss a year earlier. Gross profit margin improves to 21.2%, supported by pricing and operating efficiencies, despite the company’s higher commodity and logistics costs."

So what's driving the sales increase? Utilitarian models, vehicles like the Ranger 500 in the lead image of this article. More than 60% of sales went to utility-focused off-road vehicles and side-by-sides, with CEO Mike Speetzen telling the call, "Because we serve customers who use our vehicles for work as well as for fun, utility growth more than offset softness in more discretionary recreational markets, resulting in ORV retail growth."

What do you think?

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See, even when the economy is terrible for the vast majority of people, they still need to get things done. And given a lot of folks have replaced their trucks with side-by-sides in recent years due to trucks becoming insanely expensive, this upward trajectory of sales for Polaris in this specific market makes a whole lot of sense. It's why you've also seen other manufacturers either pivot to or enhance their lineups to give customers and consumers more utitlity-based offerings.

But this also comes on the heels of Polaris' top brass making some much-needed cuts to its portfolio, including selling off Indian Motorcycle to a private equity group and culling the Timber Sled line. It also had some cuts to personnel, which is always tough. Yet, the moves seemed to have righted the ship, and it's once again back on top.