Higher demand for its most expensive touring and cruiser motorcycles helped Harley-Davidson Inc. report a 40% revenue increase Tuesday.

For the three-month period ended Dec. 31, Harley’s revenue rose to $1.02 billion from $725 million a year earlier. The company's profit climbed to $21.6 million, or 14 cents per share, from a loss of $96.4 million, or 63 cents per share, in the same quarter a year earlier.

Analysts had expected Harley to post a loss in the recent quarter. Following the earnings announcement, the company's share price closed at $41.73, up more than 15%.

Harley's results were “much better than expected,” analyst Joe Altobello with Raymond James said in a note.

For the full year 2022, the company now said it expects revenue growth of 5% to 10% in its motorcycle division, but that it continues to be dogged by supply chain issues that have constrained manufacturing.

"It's a question of supply, not a question of demand," Jochen Zeitz, Harley's chairman, president and CEO said in a conference call with investor analysts.

"The supply chain issues are not going away. In fact, they intensify going into the year," Zeitz said.

Harley has doubled down on some of its most expensive motorcycles, including three-wheel bikes, that have higher profit margins. The company has slashed its bike-model lineup by around 40% and has pulled out of poorly performing international markets in order to focus on North America, Europe, and some portions of the Asia-Pacific region.

The goal is to be in markets where the company believes it can achieve growth with the most profitable bikes.

The company's Pan America adventure touring bike, launched a year ago, has become the No. 1 selling bike in its category in North America, according to Harley.

"We continue to see the potential for Pan America across the globe, especially in Europe," Zeitz said.

In the recent quarter, Harley’s bike sales in North America, its largest market, were up 8% from a year earlier. Worldwide, sales were up 2% with decreases in the Asia-Pacific, Latin America and EMEA (Europe, Middle East and Africa) regions.

For the full year 2021, Harley reported a 32% revenue increase and a record $415 million in operating income from its financial services division that makes loans to motorcycle buyers. The company’s worldwide bike sales were up 8%, driven by a 22% increase in North America.

“Harley-Davidson delivered a strong finish to the year,” Zeitz said.

He has been Harley’s CEO since early 2020. Under his leadership, the company has slashed costs, culled dealerships, and replaced much of the previous management team.

In December, Harley announced that its LiveWire electric motorcycle business would go public in a deal valued at nearly $1.8 billion.

Last October, the company received good news when the European Union agreed to end a 31% tariff on U.S.-made motorcycles as part of a trade dispute settlement over steel and aluminum imports.

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This article originally appeared on Milwaukee Journal Sentinel: Harley-Davidson reports 40% revenue increase on strong U.S. bike sales