Core Insights - Harley-Davidson reported a challenging year in 2025, with significant declines in revenue and motorcycle shipments, but is taking steps to stabilize the business and restore dealer confidence [1] Financial Performance - Full year 2025 revenue decreased by 14% to $4.473 billion from $5.187 billion in 2024 [1] - Fourth quarter revenue was down 28% to $496 million compared to $688 million in the same quarter of 2024 [1] - HDMC operating loss for 2025 was $29 million, a significant decline from an operating income of $278 million in 2024 [1] - Diluted EPS for 2025 was $2.78, down 19% from $3.44 in 2024, while the fourth quarter reported a diluted EPS loss of $2.44 [1] Motorcycle Shipments and Sales - Global motorcycle shipments for 2025 totaled 124,477 units, down 16% from 148,862 units in 2024 [1] - Global retail motorcycle sales decreased by 12% to 132,535 units in 2025 from 151,229 units in 2024 [1] - In North America, retail motorcycle sales increased by 5% in Q4 2025, but full year sales were down 13% [1] Harley-Davidson Financial Services (HDFS) - HDFS reported record-high operating income of $490 million for 2025, up from $248 million in 2024, driven by favorable credit loss provisions [1] - HDFS revenue decreased by 16% to $869 million in 2025 from $1.039 billion in 2024 [1] LiveWire Performance - LiveWire, the electric motorcycle segment, reported a 9% increase in revenue in Q4 2025, with an operating loss of $18 million, which is 30% less than the previous year [1] - For the full year, LiveWire sold 653 electric motorcycles, a slight increase from 612 units in 2024 [1] Capital Management - The company returned $434 million to shareholders through share repurchases and dividends in 2025 [1] - Cash and cash equivalents at year-end 2025 were $3.1 billion, up from $1.6 billion in 2024 [1] 2026 Outlook - For 2026, Harley-Davidson expects capital investments of $175 to $200 million and global motorcycle wholesale shipments of 130,000 to 135,000 units [1] - The company anticipates HDMC operating income to range from a loss of $40 million to a profit of $10 million [1]

Core Insights - Harley-Davidson announced leadership and organizational changes aimed at strengthening its connection with riders and dealers, enhancing operational capabilities, and reaffirming its commitment to Milwaukee as its business hub [1][9]. Leadership Changes - Jonathan Root has been appointed as Chief Financial and Commercial Officer, focusing on dealer relations and integration with Harley-Davidson Financial Services [3][10]. - Bryan Niketh will return as Chief Operating Officer, overseeing Product Management, Product Development, and Product Operations, bringing extensive experience back to the company [4][10]. - Matt Ryan has been named Chief Marketing and Technology Officer, tasked with unifying marketing, digital, and technology efforts to enhance data-driven marketing and customer engagement [5][10]. - Marcus Fischer has taken on the role of Chief Brand Officer, responsible for brand strategy and creative direction, reporting to Matt Ryan [6][10]. - Bill Davidson will serve as Special Advisor to the CEO and Brand Ambassador, focusing on product development and community engagement [7]. - Karen Davidson continues as Brand Ambassador, enhancing collaboration with marketing and brand teams [8]. Commitment to Milwaukee - The company reaffirmed its dedication to Milwaukee, particularly the historic Juneau Avenue campus, as the core of its operations [9]. - These organizational changes are part of a broader strategy to strengthen relationships with dealers and riders, positioning Harley-Davidson for future growth [9]. Company Background - Harley-Davidson, Inc. encompasses Harley-Davidson Motor Company and Harley-Davidson Financial Services, with a mission to lead the motorcycle industry through innovation and a commitment to adventure [11]. - The company aims to maintain its status as the most desirable motorcycle brand globally, offering customizable motorcycles, accessories, and experiences [11]. - Harley-Davidson also holds a controlling interest in LiveWire Group, Inc., focusing on electric motorcycles and urban adventure [11].

Core Viewpoint - Harley-Davidson Financial Services, Inc. has initiated tender offers to purchase all Medium-Term Notes issued by the company, aiming to manage its debt obligations effectively [1][2]. Summary by Relevant Sections Tender Offers - The tender offers are made for cash purchases of Medium-Term Notes, with specific details outlined in the Offer to Purchase dated November 17, 2025 [1][2]. - The principal amounts of the Medium-Term Notes include $700 million for 6.500% Notes due 2028 and $500 million for 5.950% Notes due 2029 [2]. Consideration and Terms - The consideration for each $1,000 principal amount of Notes will be determined based on a fixed spread plus the yield to maturity of the applicable U.S. Treasury Reference Security [2]. - The Offers will expire at 5:00 p.m. New York City time on November 21, 2025, unless extended or terminated [2][6]. Settlement and Withdrawal - The expected settlement date for validly tendered Notes is November 24, 2025, with a separate settlement for those tendered through Guaranteed Delivery Procedures expected on November 26, 2025 [4][5]. - Holders can withdraw their tendered Notes at any time before the expiration date, but not thereafter unless required by law [6]. Conditions and Management - The acceptance of Notes for purchase is subject to the satisfaction or waiver of certain conditions set forth in the Offer to Purchase [7]. - The company has the discretion to amend the Offers and extend deadlines as necessary [2][6]. Contact Information - J.P. Morgan, TD Securities, and Wells Fargo Securities are the lead dealer managers for the tender offers, providing assistance to investors [9].

Financial Data and Key Metrics Changes - Consolidated revenue in Q3 2025 increased by 17%, driven by a 23% increase in HDMC revenue, which rose by $198 million compared to the prior year [16][20] - Consolidated operating income for Q3 was $475 million, primarily influenced by HDFS operating income, which was positively impacted by the HDFS transaction [16][22] - Earnings per share for Q3 was $3.10, with global retail down 6% [17][30] - HDFS revenue decreased by 3%, while LiveWire revenue increased by 16% [16][30] Business Line Data and Key Metrics Changes - HDMC's operating income decreased by 2% year-over-year, while LiveWire reported an operating loss of $18 million [16][30] - HDMC gross margin was 26.4%, down from 30.1% in the prior year, due to unfavorable operating leverage and increased tariffs [21][22] - HDFS's operating income increased by 472% year-over-year, driven by a lower provision for credit losses and higher other income [26][28] Market Data and Key Metrics Changes - Global retail was down 6%, with North America down 5% and international markets down 9% [17][30] - In North America, the Softail family saw a 9% increase, while Adventure Touring bikes were up 4% [18][19] - EMEA retail was down 17%, but non-core segments like Adventure Touring and Nightster motorcycles showed strong growth [19][20] - In Latin America, retail was up 16%, marking the first quarter of growth since Q3 2024 [19][20] Company Strategy and Development Direction - The company is focused on improving dealer health and profitability, with immediate actions to enhance motorcycle inventory management and introduce market-responsive promotions [5][6] - The HDFS transaction aims to transform the business into a capital-light model, unlocking $1.2 to $1.25 billion in discretionary cash [14][15] - Future strategies include enhancing product accessibility, improving speed to market, and focusing on cost and capital efficiency [9][10] Management's Comments on Operating Environment and Future Outlook - Management expressed disappointment in Q3 results but highlighted the strategic value of the HDFS transaction [6][16] - The current macro environment is challenging, with high interest rates and inflation impacting consumer confidence [17][30] - Management is optimistic about future product launches and the potential to attract younger riders through new offerings [36][38] Other Important Information - The company plans to use proceeds from the HDFS transaction for debt reduction, share buybacks, and organic growth initiatives [32][31] - Total cash and cash equivalents at the end of Q3 were $1.8 billion, down $469 million from the previous year [31] Q&A Session Summary Question: Thoughts on demographic headwinds facing Harley-Davidson - Management acknowledged the need to attract younger riders and emphasized the importance of a fun and welcoming dealership experience [36][37] Question: Elaboration on market-responsive promotions - Management indicated that high dealer inventory levels necessitate promotional activities to drive sales, particularly for Touring models [39][40] Question: Impact of the HDFS transaction on operating income - Management confirmed that the transaction is expected to provide a $275-$300 million operating income benefit in the second half of the year [44][46] Question: Expectations for fourth quarter retail performance - Management noted improvements in dealer traffic but refrained from providing specific guidance due to market uncertainties [57][58] Question: Shipment expectations for 2026 - Management indicated that inventory levels are being managed carefully, with a focus on reducing Touring inventory while preparing for new model launches [52][54]

Q2 2025 Performance - Harley-Davidson reported diluted EPS of $0.88[6] - HDMC revenue decreased by 23% year-over-year[6] - Global motorcycle shipments decreased by 28% year-over-year, primarily due to planned dealer inventory reduction[6] - Global motorcycle retail sales decreased by 15% year-over-year[6] - Global dealer inventories decreased by 28% compared to Q2 '24[6] - The cost of new or increased tariffs implemented in '25 was $13 million in Q2 '25[6] - HDFS operating income margin was 27.1%[6] HDFS Transaction - Strategic partners valued the HDFS business at approximately 1.75x post-transaction book value[7] - HDFS will sell approximately two-thirds of HDFS future retail loan originations at a premium on an annual basis for five years[7] - The transaction unlocks $1.25 billion in discretionary cash, representing approximately 40% of current Harley-Davidson market capitalization[7] - HDFS has agreed to sell over $5 billion of existing gross consumer retail loan receivables and residual interests in securitized consumer loan receivables at a premium[7]

Q2 2025 Performance - Harley-Davidson diluted EPS was $0.88[6] - HDMC operating income margin was 5.9%[6] - HDMC revenue decreased by 23% year-over-year[6] - Global motorcycle shipments decreased by 28%, primarily due to planned dealer inventory reduction[6] - Global motorcycle retail sales decreased by 15% year-over-year[6] - Global dealer inventories decreased by 28% compared to Q2 '24[6, 21] - The cost of new or increased tariffs implemented in '25 was $13 million in Q2 '25[6] - HDFS operating income margin was 27.1%[6] HDFS Transaction - Strategic partners valued the HDFS business at approximately 1.75x post-transaction book value[7, 11, 14] - HDFS agreed to sell a 4.9% common equity interest to investment vehicles managed by KKR and PIMCO[7] - HDFS will sell approximately two-thirds of HDFS future retail loan originations at a premium on an annual basis for five years[7, 14, 55, 58] - The transaction unlocks $1.25 billion in discretionary cash, representing approximately 40% of current Harley-Davidson market capitalization[7] - HDFS agreed to sell over $5 billion of existing gross consumer retail loan receivables and residual interests in securitized consumer loan receivables at a premium[7, 14, 55] - HDFS expects to use a portion of the proceeds to reduce indebtedness to optimize its post-transaction capital structure[7] Financial Outlook & Capital Allocation - HDFS transaction is expected to generate ~$1B of available cash and allow for ~$1.25B distribution to H-D from HDFS[14, 67] - The company intends to use available cash for share buyback of $500M, HDI debt reduction of $450M and reinvestment in HDMC[14, 66]

Core Viewpoint - Harley-Davidson is urging shareholders to vote "FOR ALL" of its director nominees on the WHITE proxy card ahead of the 2025 Annual Meeting of Shareholders scheduled for May 14, 2025, emphasizing the importance of shareholder participation in protecting their investment and the company's future [1][2][4]. Shareholder Engagement - The company stresses the urgency for shareholders to cast their votes by telephone or online, highlighting that every vote is crucial regardless of the number of shares owned [2][3]. - Harley-Davidson has communicated directly with shareholders, reinforcing the significance of their votes in shaping the company's direction and leadership [2][4]. Board of Directors and Leadership Transition - The company is at a pivotal moment in its 120+-year history, actively seeking a new CEO who can uphold its heritage and drive future growth [5]. - The Board of Directors is engaged in a rigorous process to identify a suitable leader, and the current campaign by H Partners is viewed as a distraction that could hinder this process [5][12]. Proxy Advisory Support - Institutional Shareholder Services (ISS), a leading independent proxy advisor, has recommended that shareholders vote "FOR ALL" of Harley-Davidson's director nominees, stating that H Partners has not made a compelling case for change [8][10]. - ISS has noted that the strategy implemented by the current leadership has positively impacted the company's performance, contrasting with its previous underperformance [10]. Opposition to H Partners - The company characterizes H Partners as an opportunistic hedge fund whose campaign is self-interested and detrimental to shareholder interests [11][13]. - H Partners' actions are seen as undermining the Board's efforts to attract the best CEO candidates, with ISS indicating that the campaign has likely delayed the CEO search process [12].