Financial Data and Key Metrics Changes - Consolidated revenue in Q4 2025 decreased by 28%, with HDMC revenue down 10% and HDFS revenue down 59% [25] - Consolidated operating income for Q4 was a loss of $361 million, compared to a loss of $193 million in Q4 2024 [26] - For the full year 2025, consolidated revenue was $4.5 billion, a 14% decrease compared to the previous year, and operating income was $387 million, down from $417 million in 2024 [27] Business Line Data and Key Metrics Changes - HDMC retail performance saw North American retail sales of new motorcycles up 5% in Q4, while international retail sales were down 10% [27] - For the full year 2025, global retail sales of new motorcycles were down 12%, with North America and international markets performing similarly [30] - HDFS revenue for Q4 was $106 million, down from $257 million in the prior year, primarily due to lower retail and wholesale finance receivables [38] Market Data and Key Metrics Changes - North American retail sales for Q4 were up 5%, while EMEA retail sales declined by 24% due to macroeconomic conditions [28][29] - In Asia-Pacific, Q4 retail sales declined by 1%, with significant weakness in China [29] - Latin American retail sales increased by 10% in Q4, with both Brazil and Mexico showing growth [30] Company Strategy and Development Direction - The company is focused on stabilizing the business by restoring dealer confidence and aligning wholesale activity with retail demand [6] - Immediate priorities include improving dealer profitability, reigniting brand momentum, and reducing costs [7] - A strategic plan is expected to be announced in May 2026, with a focus on sustainable growth and optimizing inventory management [4][12] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that 2025 was a challenging year, with macro-driven pressures and internal challenges [4] - The company expects 2026 to be a transition year as it resets the business and finalizes its new strategy [12] - Margins are expected to be under pressure in the near term due to production runs being below wholesale [13] Other Important Information - Dealer inventory at the end of Q4 was down 17% compared to the previous year, exceeding the target reduction of 10% [30] - The HDFS transaction is expected to transform the business into a capital-light, de-risked model, with a significant reduction in debt [25][37] - The company plans to conduct a rigorous review of its cost base and operating expenses to align with current demand levels [20] Q&A Session Summary Question: Inquiry about HDFS operating income expectations - Management indicated that HDFS operating income for 2026 is expected to be between $45 million and $60 million, with long-term profitability projected to be significantly higher [51][52] Question: Wholesale guidance and inventory levels - Management noted that Q1 2026 wholesale shipments are expected to be down slightly compared to the previous year, with a gradual increase anticipated in Q2 [57][60] Question: Expectations for global retail sales - Management expressed optimism about U.S. retail sales, particularly with the introduction of new models, while being cautious about overall retail performance [64][66]