v3.25.4
Additional Balance Sheet and Cash Flow Information
 12 Months Ended
Dec. 31, 2025
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Additional Balance Sheet and Cash Flow Information Additional Balance Sheet and Cash Flow Information
Investments in marketable securities consisted of the following at December 31 (in thousands): 
20252024
Mutual funds$31,513 $32,070 
Mutual funds, included in Other long-term assets on the Consolidated balance sheets, are carried at fair value with gains and losses recorded in income. Mutual funds are held to support certain deferred compensation obligations.
Inventories, net consisted of the following as of December 31 (in thousands):
20252024
Raw materials and work in process$338,744 $353,819 
Motorcycle finished goods434,044 411,442 
Parts and accessories and apparel97,674 110,591 
Inventory at lower of FIFO cost or net realizable value870,462 875,852 
Excess of FIFO over LIFO cost(139,564)(130,059)
$730,898 $745,793 
Inventory obsolescence reserves deducted from FIFO cost were $69.8 million and $84.6 million as of December 31, 2025 and 2024, respectively.
Property, plant and equipment, net consisted of the following as of December 31 (in thousands):
20252024
Land and related improvements$67,805 $68,140 
Buildings and related improvements480,647 450,890 
Machinery and equipment1,509,398 1,503,514 
Software717,045 627,161 
Construction in progress143,772 246,933 
2,918,667 2,896,638 
Accumulated depreciation(2,168,443)(2,139,566)
$750,224 $757,072 
Software, net of accumulated amortization, included in Property, plant and equipment, net, was $49.6 million and $57.8 million as of December 31, 2025 and 2024, respectively.
Accrued liabilities consisted of the following as of December 31 (in thousands):
20252024
Sales incentive programs$115,954 $80,305 
Payroll, employee benefits and related expenses88,373 66,238 
Interest84,620 85,919 
Warranty and recalls45,608 46,260 
Contract liability
34,722 23,083 
Tax-related accruals31,460 20,029 
Leases17,254 18,658 
Fair value of derivative financial instruments6,494 311 
Other247,472 253,157 
$671,957 $593,960 
Deposits – HDFS offers brokered certificates of deposit to customers indirectly through contractual arrangements with third-party banks and/or securities brokerage firms through its bank subsidiary. The Company had $536.6 million and $550.6 million, net of fees, of interest-bearing brokered certificates of deposit outstanding as of December 31, 2025 and December 31, 2024, respectively. The liabilities for deposits are included in Short-term deposits, net or Long-term deposits, net on the Consolidated balance sheets based upon the term of each brokered certificate of deposit issued. Each separate brokered certificate of deposit is issued under a master certificate, and as such, all outstanding brokered certificates of deposit are considered below the Federal Deposit Insurance Corporation insurance coverage limits.
Future maturities of the Company's certificates of deposit as of December 31, 2025 were as follows (in thousands):
2026$280,626 
2027203,382 
2028
18,500 
2029
15,200 
2030
19,790 
Future maturities537,498 
Unamortized fees(854)
$536,644 
Operating Cash Flow – The reconciliation of Net income to Net cash provided by operating activities for the years ended December 31, was as follows (in thousands):
202520242023
Cash flows from operating activities:
Net income $329,154 $445,175 $695,046 
Adjustments to reconcile Net income to Net cash provided by operating activities:
Depreciation and amortization172,371 160,673 158,112 
Amortization of deferred loan origination costs45,165 70,745 85,018 
Amortization of financing origination fees13,552 13,963 13,208 
Income related to long-term employee benefits
(55,195)(54,008)(67,624)
Employee benefit plan contributions and payments(6,835)(5,078)(5,736)
Stock compensation expense31,749 49,005 82,901 
Net change in wholesale finance receivables related to sales64,461 46,884 (387,743)
Provision for credit losses(191,392)247,225 227,158 
Collections from finance receivables held for sale28,979 — — 
Proceeds from sale of finance receivables held for sale
552,670 — — 
Originations and purchases of finance receivables held for sale
(844,232)— — 
Gain on sale of securitization beneficial interests(27,867)— — 
Loss on sale of finance receivables
11,378 — — 
Loss on debt extinguishment72,630 — — 
Deferred income taxes84,143 (26,276)(30,059)
Other, net33,174 17,070 (39,713)
Changes in current assets and liabilities:
Accounts receivable, net32,646 19,778 (11,443)
Finance receivables – accrued interest and other43,786 36 (339)
Inventories, net47,577 164,609 21,257 
Accounts payable and accrued liabilities125,556 (55,436)28,570 
Other current assets5,452 (30,532)(13,726)
239,768 618,658 59,841 
Net cash provided by operating activities$568,922 $1,063,833 $754,887 
Cash paid during the years ended December 31, for interest and income taxes was as follows (in thousands):
202520242023
Interest$330,823 $358,996 $290,467 
Income taxes$39,358 $111,117 $237,658 
Operating cash flows related to finance receivables held for sale - In the third quarter of 2025, HDFS entered into the HDFS Transaction which included the sale of finance receivables as discussed in Note 6 of the Notes to Consolidated financial statements. Included in this sale were receivables that HDFS repurchased in October 2025 from a VIE that had been deconsolidated in conjunction with the sale of securitization beneficial interests discussed below. The cash outflow related to this repurchase, which was equal to the outstanding principal and interest, is reflected within the Originations and purchases of finance receivables held for sale in the Consolidated statement of cash flows. The proceeds from the subsequent sale, along with the remainder of the proceeds from the sale of finance receivables that were originated with the intent to sell and subsequently sold as part of the HDFS Transaction, are included in Proceeds from sale of finance receivables held for sale on the Consolidated statement of cash flows. Refer to Notes 6, 11, and 12 of the Notes to Consolidated financial statements for additional information about the HDFS Transaction.
Gain on sale of securitization beneficial interests – As discussed in Note 11 of the Notes to Consolidated financial statements, the Company consolidates certain SPEs, which are considered VIEs under U.S. GAAP and which hold certain assets and liabilities, including finance receivables, restricted cash, and debt. As part of the HDFS Transaction, the Company sold 95% of its residual interests in retail finance receivables that were previously transferred to certain SPEs through on-balance sheet asset-backed securitization transactions. This sale of securitization beneficial interests resulted in the deconsolidation of assets and liabilities held by certain SPEs under U.S. GAAP. The sale of securitization beneficial interests resulted in the non-cash deconsolidation of $1.87 billion of Finance receivables held for investment, net and $1.67 billion of asset-backed securitization debt held by the VIEs that were previously consolidated. As a result of the sale of securitization beneficial interests, the Company received $234.6 million in cash consideration. On the Consolidated statements of cash flows, this amount was reduced by $109.2 million of restricted cash that was deconsolidated, resulting in a $125.4 million of net cash inflow included within Proceeds from sale of securitization beneficial interests, net within Cash flows from investing activities on the Consolidated statements of cash flows. The sale of securitization beneficial interests also resulted in a gain on the sale of $27.9 million included within Cash flows provided by operating activities. Refer to Note 6 of the Notes to Consolidated financial statements for further discussion about the HDFS Transaction.