Fair Value (Tables)
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12 Months Ended |
Dec. 31, 2025 |
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| Fair Value Disclosures [Abstract] |
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| Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis |
The Company’s assets and liabilities measured at fair value on a recurring basis as of December 31, were as follows (in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | 2025 | | Balance | | Level 1 | | Level 2 | | Level 3 | | Assets: | | | | | | | | | Cash equivalents | $ | 2,693,739 | | | $ | 2,553,850 | | | $ | 139,889 | | | $ | — | | | Marketable securities | 31,513 | | | 31,513 | | | — | | | — | | | | | | | | | | | Derivative financial instruments | 108,435 | | | — | | | 108,435 | | | — | | | Investments in Retained Notes | 68,130 | | | — | | | 68,130 | | | — | | | Investments in Residual Interests | 10,156 | | | — | | | — | | | 10,156 | | | 2,911,973 | | | 2,585,363 | | | 316,454 | | | 10,156 | | | Liabilities: | | | | | | | | | Derivative financial instruments | $ | 6,494 | | | $ | — | | | $ | 6,494 | | | $ | — | | | LiveWire warrants | 1,901 | | | 1,244 | | | 657 | | | — | | | $ | 8,395 | | | $ | 1,244 | | | $ | 7,151 | | | $ | — | | | | | | | | | | | 2024 | | Balance | | Level 1 | | Level 2 | | Level 3 | | Assets: | | | | | | | | | Cash equivalents | $ | 1,275,561 | | | $ | 1,000,933 | | | $ | 274,628 | | | $ | — | | | Marketable securities | 32,070 | | | 32,070 | | | — | | | — | | | | | | | | | | | Derivative financial instruments | 19,839 | | | — | | | 19,839 | | | — | | | $ | 1,327,470 | | | $ | 1,033,003 | | | $ | 294,467 | | | $ | — | | | Liabilities: | | | | | | | | | Derivative financial instruments | $ | 35,020 | | | $ | — | | | $ | 35,020 | | | $ | — | | | LiveWire warrants | 1,549 | | | 1,013 | | | 536 | | | — | | | $ | 36,569 | | | $ | 1,013 | | | $ | 35,556 | | | $ | — | |
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| Schedule of Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation |
The following table presents the reconciliation for all Level 3 assets measured at fair value on a recurring basis (in thousands): | | | | | | | | | | | Investments in Residual Interests | Fair value at December 31, 2024(a) | | $ | — | | Initial Fair Value | | 12,348 | | Investment Proceeds | | (2,336) | Realized gain reclassified from Other Comprehensive Loss to earnings | | 81 | Unrealized gain included in Other Comprehensive Loss | | 63 | Fair value at December 31, 2025 | | $ | 10,156 | |
(a) No assets or liabilities were measured using Level 3 inputs as of December 31, 2024 or 2023 so the prior period reconciliation has been excluded.
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| Schedule of Fair Value Measurement Inputs and Valuation Techniques |
The initial and current period fair values of the Residual Interests were calculated using the following ranges of key assumptions: | | | | | | | | | | | | | Initial Fair Value | | December 31,
2025 | Recovery rate on defaulted receivables | 50.00% | | 50.00% | Prepayment speed | 1.40% | | 1.40% | Expected cumulative lifetime losses | 1.56% - 2.65% | | 2.01%- 3.21% | Weighted-average life (in years) | 0.85 - 2.49 | | 0.96 - 2.46 | Residual cash flows discount rate | 15.00% | | 15.00% |
The weighted average of the key assumptions utilized in calculating the initial and current period fair values of the Residual Interests were as follows: | | | | | | | | | | | | | Initial Fair Value | | December 31,
2025 | Recovery rate on defaulted receivables | 50.00% | | 50.00% | Prepayment speed | 1.40% | | 1.40% | Expected cumulative lifetime losses | 2.33% | | 2.47% | Weighted-average life (in years) | 1.91 | | 1.87 | Residual cash flows discount rate | 15.00% | | 15.00% |
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| Schedule Of Sensitivity Analysis Of Fair Value, Investment In Retained Notes And Residual Interests |
The sensitivity of the fair value to immediate adverse changes in the key assumptions for the investment in Residual Interests at December 31, 2025 is as follows (dollars in thousands): | | | | | | | December 31,
2025 | Fair value of Residual Interests | $ | 10,156 | | | | Prepayment speed | | Impact on fair value of a 1.5% absolute prepayment speed adverse change | $ | (94) | | Impact on fair value of a 1.6% absolute prepayment speed adverse change | $ | (186) | | Expected cumulative lifetime losses | | Impact on fair value of a 25 bps adverse change | $ | (183) | | Impact on fair value of a 50 bps adverse change | $ | (365) | | Residual cash flows discount rate | | Impact on fair value of a 25 bps adverse change | $ | (44) | | Impact on fair value of a 50 bps adverse change | $ | (88) | |
The sensitivity of the fair value to immediate adverse changes in the key assumptions for the investment in Retained Notes at December 31, 2025 is as follows (dollars in thousands): | | | | | | | December 31,
2025 | Fair value of Retained Notes | $ | 68,130 | | Weighted-average life (in years) | 1.86 | Discount rate | | Impact on fair value of a 50 bps adverse change | $ | (300) | | Impact on fair value of a 100 bps adverse change | $ | (613) | |
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| Schedule of the Unrealized Positions for Available for Sale Residual Interests and Retained Notes |
The table below summarizes the unrealized positions for Residual Interests and Retained Notes (in thousands): | | | | | | | | | | | | | | | | | | | | | | | December 31, 2025 | | | Amortized Cost | | Unrealized Gains | | Fair Value | Residual Interests | | $ | 10,109 | | | $ | 47 | | | $ | 10,156 | | Retained Notes | | 68,001 | | 129 | | $ | 68,130 | | Total Beneficial Interests | | $ | 78,110 | | | $ | 176 | | | $ | 78,286 | |
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| Schedule of Fair Value, Cash Flows Received/Paid To All Motorcycle Loan Securitization Trusts |
The table below provides information regarding certain cash flows that were received from all motorcycle loan off-balance sheet securitized trusts during the twelve months ended December 31, 2025 (in thousands): | | | | | | Proceeds from sale of residual interests (a) | $ | 234,617 | | Servicing, late, and ancillary fees received | 8,521 | | Collections of retained securitization beneficial interests | $ | 23,722 | |
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| Schedule of the Fair Value and Carrying Value of the Company's Financial Instruments |
The fair value and carrying value of the Company’s remaining financial instruments that are measured at cost or amortized cost at December 31, were as follows (in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | | 2025 | | 2024 | | | Fair Value | | Carrying Value | | Fair Value | | Carrying Value | | Assets: | | | | | | | | Finance receivables held for sale, net | $ | 268,111 | | | $ | 264,238 | | | $ | — | | | $ | — | | Finance receivables held for investment, net (a) | $ | 1,665,453 | | | $ | 1,653,372 | | | $ | 7,342,319 | | | $ | 7,288,294 | | | Liabilities: | | | | | | | | | Deposits, net | $ | 537,136 | | | $ | 536,644 | | | $ | 555,902 | | | $ | 550,586 | | | Debt: | | | | | | | | | Unsecured commercial paper | $ | 497,776 | | | $ | 497,776 | | | $ | 640,204 | | | $ | 640,204 | | | Asset-backed U.S. commercial paper conduit facilities | $ | — | | | $ | — | | | $ | 431,846 | | | $ | 431,846 | | | Asset-backed Canadian commercial paper conduit facility | $ | — | | | $ | — | | | $ | 77,381 | | | $ | 77,381 | | | Asset-backed securitization debt | $ | — | | | $ | — | | | $ | 1,955,006 | | | $ | 1,950,138 | | | Medium-term notes | $ | 2,195,390 | | | $ | 2,171,963 | | | $ | 3,127,710 | | | $ | 3,114,013 | | | Senior notes | $ | 241,057 | | | $ | 297,278 | | | $ | 683,624 | | | $ | 746,800 | |
(a) Excludes $47.6 million estimated recovery amount included in the allowance for credit losses. Refer to Note 6 of the Notes to the Consolidated financial statements for additional information.
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