LCI Industries (NYSE: LCII) boosts Q1 2026 earnings on better margins
Filing Impact
Filing Sentiment
Form Type
10-Q
Rhea-AI Filing Summary
LCI Industries delivered stronger results for the quarter ended March 31, 2026. Net sales rose to $1.09 billion from $1.05 billion, driven by price increases, contributions from recent acquisitions, and growth in adjacent OEM and aftermarket markets despite softer North American RV shipments.
Net income increased to $62.9 million from $49.4 million, with diluted EPS up to $2.53 from $1.94 as operating margin improved to 8.7% from 7.8% on sourcing gains, cost actions, and a richer mix of higher-content products. OEM sales grew 4%, while Aftermarket sales grew 7%.
Operating cash flow was a $33.5 million outflow, mainly from higher receivables and inventory ahead of the selling season. The company ended the quarter with $142.2 million in cash, $945.0 million of long-term debt, and $595.2 million of unused revolver capacity, and paid a quarterly dividend of $1.15 per share.
Positive
- Earnings and margin expansion: Q1 2026 net income rose to $62.9 million from $49.4 million and operating margin improved to 8.7% from 7.8%, showing effective pricing, sourcing, and cost actions despite higher material costs.
Negative
- None.
Insights
Q1 2026 shows margin recovery and solid demand diversification despite softer RV shipments.
LCI Industries grew net sales $1.09 billion versus $1.05 billion, while diluted EPS increased to $2.53 from $1.94. OEM revenue rose 4% and Aftermarket 7%, reflecting pricing, acquisitions, and strength in adjacent industries and aftermarket channels.
Operating margin expanded to 8.7% from 7.8% as targeted price increases, sourcing initiatives, and footprint optimization more than offset higher steel and aluminum costs and lower towable RV volumes. Segment detail shows OEM margin at 9.0% and Aftermarket at 7.8%, with the latter pressured by material inflation and capacity investments.
The quarter’s main trade-off is earnings strength versus working-capital usage. Operating cash flow was a $33.5 million outflow, driven by a $134.5 million rise in receivables and $27.3 million inventory build ahead of peak season. Even so, liquidity remains ample with $142.2 million in cash and $595.2 million of revolver availability as of March 31, 2026, supporting ongoing dividends and planned $55–$75 million of 2026 capex.
Key Figures
Net sales: $1,090.5M
Net income: $62.9M
Diluted EPS: $2.53
+5 more
8 metrics
Net sales
$1,090.5M
Three months ended March 31, 2026 vs $1,045.6M in 2025
Net income
$62.9M
Three months ended March 31, 2026 vs $49.4M in 2025
Diluted EPS
$2.53
Q1 2026 diluted earnings per share vs $1.94 in Q1 2025
Operating profit
$95.2M
Q1 2026 operating profit; margin 8.7% vs 7.8% in 2025
Operating cash flow
($33.5M)
Net cash used in operating activities in Q1 2026
Cash and cash equivalents
$142.2M
Cash balance as of March 31, 2026
Total long-term indebtedness
$941.3M
Long-term debt net of current portion as of March 31, 2026
Quarterly dividend
$1.15/share
First quarter 2026 dividend; $27.9M total paid
Key Terms
2030 Convertible Notes, Term Loans, net leverage ratio, Aftermarket Segment, +2 more
6 terms
2030 Convertible Notes financial
"For the Company's 3.000 percent convertible senior notes due 2030 (the "2030 Convertible Notes") issued in March 2025..."
Term Loans financial
"The Credit Agreement also provides for term loans (the "Term Loans") to the Company in an aggregate principal amount of $400.0 million."
Term loans are long-term bank or lender loans with a set repayment schedule and fixed end date, similar to a mortgage or car loan for a business. They matter to investors because they create predictable interest payments and principal obligations that affect a company’s cash flow, credit risk and capacity to fund growth or return money to shareholders; heavier or expensive term loans can raise default risk and reduce future flexibility.
net leverage ratio financial
"Pursuant to the Credit Agreement, the Company shall not permit its net leverage ratio to exceed certain limits..."
The net leverage ratio measures how much debt a company has compared to its available assets or earnings, after accounting for its cash and liquid assets. It helps investors understand how heavily a company relies on borrowed money to finance its operations and growth. A higher ratio indicates greater financial risk, while a lower ratio suggests a more cautious approach to borrowing.
Aftermarket Segment financial
"The Aftermarket Segment, which accounted for 22 percent and 21 percent of consolidated net sales..."
operating lease right-of-use assets financial
"Operating lease right-of-use assets | 272,422 | 272,995"
An operating lease right-of-use (ROU) asset is an accounting entry that shows the value of a leased item you have the legal right to use—like a building, vehicle, or equipment—recorded on a company’s balance sheet along with the corresponding lease obligation. Investors care because it adds to reported assets and liabilities, changing measures like leverage and return on assets much like bringing a long-term rental onto the company’s financial snapshot, which can affect credit terms and valuation.
inventory obsolescence reserves financial
"At March 31, 2026 and December 31, 2025, the Company had recorded inventory obsolescence reserves of $81.3 million and $80.4 million, respectively."
Earnings Snapshot
Revenue: $1.09B
Q1 2026
Revenue
$1.09B
+4.3% vs Q1 2025
Net income
$62.9M
up from $49.4M in Q1 2025
Diluted EPS
$2.53
up from $1.94 in Q1 2025
Operating margin
8.7%
up from 7.8% in Q1 2025
OEM Segment net sales
$852.8M
+4% vs Q1 2025
Aftermarket Segment net sales
$237.7M
+7% vs Q1 2025
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the quarterly period ended: March 31, 2026
or
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the transition period from _________________ to _________________
Commission File Number: 001-13646
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of | (I.R.S. Employer | |||||||
| incorporation or organization) | Identification Number) | |||||||
| (Zip Code) | ||||||||
| (Address of principal executive offices) | ||||||||
(574 ) 535-1125
(Registrant’s telephone number, including area code)
(Former name, former address and former fiscal year, if changed since last report) N/A
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
1
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Non-accelerated filer ☐ Smaller reporting company ☐
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
The number of shares outstanding of the registrant’s common stock, as of the latest practicable date (April 29, 2026) was 24,285,202 shares of common stock.
2
LCI INDUSTRIES
TABLE OF CONTENTS
| Page | ||||||||
PART I – | FINANCIAL INFORMATION | |||||||
ITEM 1 – FINANCIAL STATEMENTS | ||||||||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME | 4 | |||||||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | 5 | |||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | 6 | |||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | 7 | |||||||
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY | 9 | |||||||
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | 10 | |||||||
ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS | 24 | |||||||
ITEM 3 – QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK | 34 | |||||||
ITEM 4 – CONTROLS AND PROCEDURES | 34 | |||||||
PART II – | OTHER INFORMATION | |||||||
ITEM 1 – LEGAL PROCEEDINGS | 35 | |||||||
ITEM 1A – RISK FACTORS | 35 | |||||||
ITEM 2 – UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS | 35 | |||||||
ITEM 5 – OTHER INFORMATION | 35 | |||||||
ITEM 6 – EXHIBITS | 35 | |||||||
SIGNATURES | 36 | |||||||
| EXHIBIT 31.1 - SECTION 302 CEO CERTIFICATION | ||||||||
| EXHIBIT 31.2 - SECTION 302 CFO CERTIFICATION | ||||||||
| EXHIBIT 32.1 - SECTION 906 CEO CERTIFICATION | ||||||||
| EXHIBIT 32.2 - SECTION 906 CFO CERTIFICATION | ||||||||
3
PART I – FINANCIAL INFORMATION
ITEM 1 – FINANCIAL STATEMENTS
LCI INDUSTRIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
| Three Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| (In thousands, except per share amounts) | |||||||||||
| Net sales | $ | $ | |||||||||
| Cost of sales | |||||||||||
| Gross profit | |||||||||||
| Warehouse and transportation | |||||||||||
| Selling, general and administrative expenses | |||||||||||
| Operating profit | |||||||||||
| Interest expense, net | |||||||||||
| Loss on extinguishment of debt | |||||||||||
| Income before income taxes | |||||||||||
| Provision for income taxes | |||||||||||
| Net income | $ | $ | |||||||||
| Net income per common share: | |||||||||||
| Basic | $ | $ | |||||||||
| Diluted | $ | $ | |||||||||
| Weighted average common shares outstanding: | |||||||||||
| Basic | |||||||||||
| Diluted | |||||||||||
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
4
LCI INDUSTRIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)
| Three Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| (In thousands) | |||||||||||
| Net income | $ | $ | |||||||||
| Other comprehensive income (loss): | |||||||||||
| Net foreign currency translation adjustment | ( | ||||||||||
| Total comprehensive income | $ | $ | |||||||||
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
5
LCI INDUSTRIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
| March 31, | December 31, | ||||||||||
| 2026 | 2025 | ||||||||||
| (In thousands, except per share amount) | |||||||||||
| ASSETS | |||||||||||
| Current assets | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
Accounts receivable, net of allowances of $ | |||||||||||
| Inventories, net | |||||||||||
| Prepaid expenses and other current assets | |||||||||||
| Total current assets | |||||||||||
| Fixed assets, net | |||||||||||
| Goodwill | |||||||||||
| Other intangible assets, net | |||||||||||
| Operating lease right-of-use assets | |||||||||||
| Other long-term assets | |||||||||||
| Total assets | $ | $ | |||||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||
| Current liabilities | |||||||||||
| Current maturities of long-term indebtedness | $ | $ | |||||||||
| Accounts payable, trade | |||||||||||
| Current portion of operating lease obligations | |||||||||||
| Accrued expenses and other current liabilities | |||||||||||
| Total current liabilities | |||||||||||
| Long-term indebtedness | |||||||||||
| Operating lease obligations | |||||||||||
| Deferred taxes | |||||||||||
| Other long-term liabilities | |||||||||||
| Total liabilities | |||||||||||
| Stockholders' equity | |||||||||||
Common stock, par value $ | |||||||||||
| Paid-in capital | |||||||||||
| Retained earnings | |||||||||||
| Accumulated other comprehensive income | |||||||||||
| Stockholders' equity before treasury stock | |||||||||||
| Treasury stock, at cost | ( | ( | |||||||||
| Total stockholders' equity | |||||||||||
| Total liabilities and stockholders' equity | $ | $ | |||||||||
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
6
| LCI INDUSTRIES | |||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||
| (Unaudited) | |||||||||||
| Three Months Ended March 31, | |||||||||||
| (In thousands) | 2026 | 2025 | |||||||||
| Cash flows from operating activities: | |||||||||||
| Net income | $ | $ | |||||||||
| Adjustments to reconcile net income to cash flows (used in) provided by operating activities: | |||||||||||
| Depreciation and amortization | |||||||||||
| Stock-based compensation expense | |||||||||||
| Loss on extinguishment of debt | |||||||||||
| Other non-cash items | |||||||||||
| Changes in assets and liabilities, net of acquisitions of businesses: | |||||||||||
| Accounts receivable, net | ( | ( | |||||||||
| Inventories, net | ( | ||||||||||
| Prepaid expenses and other assets | |||||||||||
| Accounts payable, trade | |||||||||||
| Accrued expenses and other liabilities | |||||||||||
| Net cash flows (used in) provided by operating activities | ( | ||||||||||
| Cash flows from investing activities: | |||||||||||
| Capital expenditures | ( | ( | |||||||||
| Acquisition of businesses | ( | ||||||||||
| Other investing activities | ( | ||||||||||
| Net cash flows used in investing activities | ( | ( | |||||||||
| Cash flows from financing activities: | |||||||||||
| Vesting of stock-based awards, net of shares tendered for payment of taxes | ( | ( | |||||||||
| Repayments under revolving credit facility | ( | ||||||||||
| Proceeds from term loan borrowings | |||||||||||
| Repayments under term loan and other borrowings | ( | ( | |||||||||
| Proceeds from issuance of convertible notes | |||||||||||
| Repurchase of convertible notes | ( | ||||||||||
| Purchases of convertible note hedge contracts | ( | ||||||||||
| Proceeds from issuance of warrants concurrent with note hedge contracts | |||||||||||
| Partial unwind of convertible note hedge and warrants | |||||||||||
| Payment of debt issuance costs | ( | ||||||||||
| Payment of dividends | ( | ( | |||||||||
| Repurchases of common stock | ( | ||||||||||
| Other financing activities | ( | ||||||||||
| Net cash flows (used in) provided by financing activities | ( | ||||||||||
| Effect of exchange rate changes on cash and cash equivalents | ( | ( | |||||||||
| Net (decrease) increase in cash and cash equivalents | ( | ||||||||||
| Cash and cash equivalents at beginning of period | |||||||||||
| Cash and cash equivalents at end of period | $ | $ | |||||||||
7
| LCI INDUSTRIES | |||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||
| (Unaudited) | |||||||||||
| Three Months Ended March 31, | |||||||||||
| (In thousands) | 2026 | 2025 | |||||||||
| Supplemental disclosure of cash flow information: | |||||||||||
| Cash paid (received) during the period for: | |||||||||||
| Interest | $ | $ | |||||||||
| Income taxes | $ | ( | $ | ||||||||
| Non-cash investing and financing activities: | |||||||||||
| Purchase of property and equipment in accrued expenses | $ | $ | |||||||||
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
8
LCI INDUSTRIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(Unaudited)
| (In thousands, except shares and per share amounts) | Common Stock | Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income | Treasury Stock | Total Stockholders’ Equity | |||||||||||||||||||||||||||||
| Balance - December 31, 2024 | $ | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||
| Net income | — | — | — | — | |||||||||||||||||||||||||||||||
Issuance of | ( | — | — | — | ( | ||||||||||||||||||||||||||||||
| Stock-based compensation expense | — | — | — | — | |||||||||||||||||||||||||||||||
| Purchase of convertible note hedge contracts, net of tax | — | ( | — | — | — | ( | |||||||||||||||||||||||||||||
| Issuance of warrants | — | — | — | — | |||||||||||||||||||||||||||||||
| Partial unwind of convertible note hedge and warrants | — | — | — | — | |||||||||||||||||||||||||||||||
Repurchase of | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||
| Other comprehensive income | — | — | — | — | |||||||||||||||||||||||||||||||
Cash dividends ($ | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||
| Dividend equivalents on stock-based awards | — | ( | — | — | |||||||||||||||||||||||||||||||
| Balance - March 31, 2025 | $ | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||
| (In thousands, except shares and per share amounts) | Common Stock | Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income | Treasury Stock | Total Stockholders’ Equity | |||||||||||||||||||||||||||||
| Balance - December 31, 2025 | $ | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||
| Net income | — | — | — | — | |||||||||||||||||||||||||||||||
Issuance of | ( | — | — | — | ( | ||||||||||||||||||||||||||||||
| Stock-based compensation expense | — | — | — | — | |||||||||||||||||||||||||||||||
| Other comprehensive loss | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||
Cash dividends ($ | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||
| Dividend equivalents on stock-based awards | — | ( | — | — | |||||||||||||||||||||||||||||||
| Balance - March 31, 2026 | $ | $ | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
9
LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. BASIS OF PRESENTATION
The Condensed Consolidated Financial Statements include the accounts of LCI Industries and its wholly-owned subsidiaries ("LCII" and collectively with its subsidiaries, the "Company," "we," "us," or "our"). LCII has no unconsolidated subsidiaries. All significant intercompany balances and transactions have been eliminated.
LCII, through its wholly-owned subsidiary, Lippert Components, Inc. and its subsidiaries (collectively, "Lippert Components," "LCI," or "Lippert"), is a global leader in supplying engineered components to the outdoor recreation, transportation, marine, and housing industries. In addition to serving original equipment manufacturers ("OEMs"), the Company also caters to aftermarket needs, selling through retail dealers, wholesale distributors, and service centers, as well as direct-to-consumer sales through online platforms. At March 31, 2026, the Company operated over 100 manufacturing facilities located throughout North America and Europe.
The Company's results are influenced by seasonal demand patterns, with sales and profits typically strongest in the second quarter and weakest in the fourth quarter. However, economic conditions, dealer inventory fluctuations, and consumer trends can impact these patterns. Additionally, many of the optional upgrades and non-critical replacement parts for recreational vehicles ("RVs") are purchased outside the normal product selling season, thereby causing certain Aftermarket Segment sales to be counter-seasonal.
The Company is not aware of any significant events which occurred subsequent to the balance sheet date but prior to the filing of this report that would have a material impact on the Condensed Consolidated Financial Statements.
In the opinion of management, the information furnished in this Form 10-Q reflects all adjustments necessary for a fair statement of the financial position and results of operations for the interim periods presented. The Condensed Consolidated Financial Statements have been prepared in accordance with the instructions to Form 10-Q, and therefore do not include some information necessary to conform to annual reporting requirements. Results for interim periods should not be considered indicative of results for the full year.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, net sales and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, the Company evaluates its estimates, including, but not limited to, those related to product returns, sales and purchase rebates, accounts receivable, inventories, goodwill and other intangible assets, net assets of acquired businesses, income taxes, warranty and product recall obligations, self-insurance obligations, operating lease right-of-use assets and obligations, asset retirement obligations, long-lived assets, pension and post-retirement benefits, stock-based compensation, segment allocations, contingent consideration, environmental liabilities, contingencies, and litigation. The Company bases its estimates on historical experience, other available information, and various other assumptions believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities not readily apparent from other resources. Actual results and events could differ significantly from management estimates.
Risks and Uncertainties
Negative conditions in the general economy in the United States or abroad, including conditions resulting from financial and credit market fluctuations, elevated inflation and interest rates, changes in economic policy, trade uncertainty, including changes in tariffs, sanctions, international treaties, and other trade restrictions, geopolitical tensions, armed conflicts, natural disasters or global public health crises, have negatively impacted, and could continue to negatively impact, the Company’s business, liquidity, financial condition and results of operations.
10
LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Condensed Consolidated Financial Statements presented herein have been prepared by the Company in accordance with the accounting policies described in its Annual Report on Form 10-K for the year ended December 31, 2025 and should be read in conjunction with the Notes to Consolidated Financial Statements which appear in that report.
Recent Accounting Pronouncements
Recently issued accounting pronouncements not yet adopted
In December 2025, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements, which is intended to improve the navigability of the guidance in Accounting Standards Codification 270, Interim Reporting, and clarify when it applies. ASU 2025-11 also addresses the form and content of such financial statements, interim disclosures requirements, and establishes a principle under which an entity must disclose events since the end of the last annual reporting period that have a material impact on the entity. This ASU is effective for fiscal years beginning after December 15, 2027, and interim periods within those annual reporting periods, with early adoption permitted. The Company is evaluating the effect of adopting this new accounting guidance.
In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which removes all references to software development project stages and requires entities to start capitalizing software costs when both of the following occur: (i) management has authorized and committed to funding the software project; and (ii) it is probable that the project will be completed and the software will be used to perform the function intended. This ASU is effective for fiscal years beginning after December 15, 2027, and interim periods within those annual reporting periods, with early adoption permitted. The Company is evaluating the effect of adopting this new accounting guidance.
In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40), which requires disclosure of disaggregated information about specific categories underlying certain income statement expense line items in the notes to the financial statements for both annual and interim periods. This ASU is effective for fiscal years beginning after December 15, 2026, and interim periods beginning after December 15, 2027, with early adoption permitted. The Company is evaluating the effect of adopting this new accounting guidance.
Recently adopted accounting pronouncements
In July 2025, the FASB issued ASU 2025-05, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets, which provides a practical expedient and an accounting policy election related to the estimation of expected credit losses for current accounts receivable and current contract assets. Effective January 1, 2026, the Company adopted ASU 2025-05 on a prospective basis. In connection with this adoption, the Company elected to apply the practical expedient permitted by the standard, which assumes that current conditions as of the balance sheet date do not change for the remaining life of the assets. The adoption of this standard did not have a material impact on the Company's financial condition or results of operations.
11
LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
3. EARNINGS PER SHARE
The following reconciliation details the denominator used in the computation of basic and diluted earnings per share for the periods indicated:
| Three Months Ended March 31, | |||||||||||
| (In thousands) | 2026 | 2025 | |||||||||
| Weighted average shares outstanding for basic earnings per share | |||||||||||
| Common stock equivalents pertaining to stock-based awards | |||||||||||
| Dilutive effect of 2030 Convertible Notes | |||||||||||
| Weighted average shares outstanding for diluted earnings per share | |||||||||||
| Equity instruments excluded from diluted net earnings per share calculation as the effect would have been antidilutive | |||||||||||
2030 Convertible Notes
For the Company's 3.000 percent convertible senior notes due 2030 (the "2030 Convertible Notes") issued in March 2025, the dilutive effect is calculated using the if-converted method. The Company is required, pursuant to the indenture governing the 2030 Convertible Notes, dated March 14, 2025, by and between the Company and U.S. Bank Trust Company, National Association, as trustee (the "2030 Notes Indenture”), to settle the principal amount of the 2030 Convertible Notes in cash and may elect to settle the remaining conversion obligation (i.e., the stock price in excess of the conversion price) in cash, shares of the Company’s common stock, or a combination thereof. Under the if-converted method, the Company includes the number of shares required to satisfy the conversion obligation, assuming all the 2030 Convertible Notes are converted. Because the average closing price of the Company’s common stock for the three months ended March 31, 2026, which is used as the basis for determining the dilutive effect on earnings per share, was higher than the conversion price of $116.62 , all associated shares were dilutive.
In conjunction with the issuance of the 2030 Convertible Notes, the Company, in privately negotiated transactions with certain commercial banks (the “2030 Counterparties”), sold warrants to purchase 3.9 million shares of the Company’s common stock (the “2030 Warrants”). The 2030 Warrants have a strike price of $182.94 per share, subject to customary anti-dilution adjustments. For calculating the dilutive effect of the 2030 Warrants, the Company uses the treasury stock method, which assumes exercise of the 2030 Warrants at the beginning of the period, or at time of issuance if later, and issuance of shares of common stock upon exercise. Proceeds from the exercise of the 2030 Warrants are assumed to be used to repurchase shares of the Company’s common stock at the average market price during the period. The incremental shares, representing the number of shares assumed to be received upon the exercise of the 2030 Warrants less the number of shares repurchased, are included in diluted shares. For the three months ended March 31, 2026, the average share price was below the Warrant strike price of $182.94 per share, and therefore 3.9 million shares were considered antidilutive.
In connection with the issuance of the 2030 Convertible Notes, the Company entered into privately negotiated call option contracts on the Company’s common stock (the “2030 Convertible Note Hedge Transactions”) with the 2030 Counterparties. The aggregate cost to the Company of the 2030 Convertible Note Hedge Transactions was $67.6 million pursuant to the 2030 Convertible Note Hedge Transactions. The 2030 Convertible Note Hedge Transactions cover, subject to anti-dilution adjustments substantially similar to those in the 2030 Convertible Notes, approximately 3.9 million shares of the Company’s common stock, the same number of shares initially underlying the 2030 Convertible Notes, at a strike price of approximately $116.62 , subject to customary anti-dilution adjustments. The 2030 Convertible Note Hedge Transactions will expire upon the maturity of the 2030 Convertible Notes, subject to earlier exercise or termination. Exercise of the 2030 Convertible Note Hedge Transactions would reduce the number of shares of the Company’s common stock outstanding, and therefore would be antidilutive.
2026 Convertible Notes
For the Company's 1.125 percent convertible senior notes due 2026 (the "2026 Convertible Notes") issued in May 2021, the dilutive effect is calculated using the if-converted method. The Company is required, pursuant to the indenture governing the 2026 Convertible Notes, dated May 13, 2021, by and between the Company and U.S. Bank National Association,
12
LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
as trustee (the "2026 Notes Indenture"), to settle the principal amount of the 2026 Convertible Notes in cash and may elect to settle the remaining conversion obligation (i.e., the stock price in excess of the conversion price) in cash, shares of the Company's common stock, or a combination thereof. Under the if-converted method, the Company includes the number of shares required to satisfy the conversion obligation, assuming all the 2026 Convertible Notes are converted. Because the average closing price of the Company's common stock for the three months ended March 31, 2026, which is used as the basis for determining the dilutive effect on earnings per share, was less than the adjusted conversion price of $157.01 , all associated shares were antidilutive.
In conjunction with the issuance of the 2026 Convertible Notes, the Company, in privately negotiated transactions with certain commercial banks (the "2026 Counterparties"), sold warrants to purchase 2.8 million shares of the Company's common stock (the "2026 Warrants"). The 2026 Warrants have a strike price of $246.29 per share, as adjusted for and subject to customary anti-dilution adjustments. For calculating the dilutive effect of the 2026 Warrants, the Company uses the treasury stock method, which assumes exercise of the 2026 Warrants at the beginning of the period, or at time of issuance if later, and issuance of shares of common stock upon exercise. Proceeds from the exercise of the 2026 Warrants are assumed to be used to repurchase shares of the Company's common stock at the average market price during the period. The incremental shares, representing the number of shares assumed to be received upon the exercise of the 2026 Warrants less the number of shares repurchased, are included in diluted shares. Concurrently with the 2026 Convertible Note Repurchases (as defined below), we entered into agreements to terminate a proportionate amount of the 2026 Warrants, which resulted in a reduction of the number of shares of common stock underlying the 2026 Warrants to an aggregate of 0.6 million shares of common stock. For the three months ended March 31, 2026, the average share price was below the 2026 Warrant adjusted strike price of $246.29 per share, and therefore 0.6
In connection with the issuance of the 2026 Convertible Notes, the Company entered into privately negotiated call option contracts on the Company's common stock (the "2026 Convertible Note Hedge Transactions") with the 2026 Counterparties. The Company paid an aggregate amount of $100.1 million to the 2026 Counterparties pursuant to the 2026 Convertible Note Hedge Transactions. The 2026 Convertible Note Hedge Transactions initially covered, subject to anti-dilution adjustments substantially similar to those in the 2026 Convertible Notes, approximately 2.8 million shares of the Company's common stock, the same number of shares initially underlying the 2026 Convertible Notes, at an initial strike price of approximately $165.65 , subject to customary anti-dilution adjustments. The 2026 Convertible Note Hedge Transactions will expire upon the maturity of the 2026 Convertible Notes, subject to earlier exercise or termination. Concurrently with the 2026 Convertible Note Repurchases, we entered into agreements to terminate a proportionate amount of the 2026 Convertible Note Hedge Transactions, which resulted in a reduction of the number of shares of common stock underlying the 2026 Convertible Note Hedge Transactions to an aggregate of 0.6 million shares of common stock. Exercise of the 2026 Convertible Note Hedge Transactions would reduce the number of shares of the Company's common stock outstanding, and therefore would be antidilutive.
4. GOODWILL AND OTHER INTANGIBLE ASSETS
Goodwill
Changes in the carrying amount of goodwill by reportable segment were as follows:
| (In thousands) | OEM Segment | Aftermarket Segment | Total | ||||||||||||||
| Net balance – December 31, 2025 | $ | $ | $ | ||||||||||||||
| Foreign currency translation | ( | ( | ( | ||||||||||||||
Net balance – March 31, 2026 | $ | $ | $ | ||||||||||||||
Goodwill represents the excess of the total consideration given in an acquisition of a business over the fair value of the net tangible and identifiable intangible assets acquired. Goodwill is not amortized, but instead is tested at the reporting unit level for impairment annually in November, or more frequently if certain circumstances indicate a possible impairment may exist.
13
LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Other Intangible Assets
Other intangible assets consisted of the following at March 31, 2026:
| (In thousands) | Gross Cost | Accumulated Amortization | Net Balance | Estimated Useful Life in Years | |||||||||||||||||||||||||
| Customer relationships | $ | $ | $ | to | |||||||||||||||||||||||||
| Patents | to | ||||||||||||||||||||||||||||
| Trade names (finite life) | to | ||||||||||||||||||||||||||||
| Trade names (indefinite life) | — | Indefinite | |||||||||||||||||||||||||||
| Non-compete agreements | to | ||||||||||||||||||||||||||||
| Other | to | ||||||||||||||||||||||||||||
| Other intangible assets | $ | $ | $ | ||||||||||||||||||||||||||
Other intangible assets consisted of the following at December 31, 2025:
| (In thousands) | Gross Cost | Accumulated Amortization | Net Balance | Estimated Useful Life in Years | |||||||||||||||||||||||||
| Customer relationships | $ | $ | $ | to | |||||||||||||||||||||||||
| Patents | to | ||||||||||||||||||||||||||||
| Trade names (finite life) | to | ||||||||||||||||||||||||||||
| Trade names (indefinite life) | — | Indefinite | |||||||||||||||||||||||||||
| Non-compete agreements | to | ||||||||||||||||||||||||||||
| Other | to | ||||||||||||||||||||||||||||
| Other intangible assets | $ | $ | $ | ||||||||||||||||||||||||||
5. INVENTORIES
Inventories are stated at the lower of cost (first-in, first-out (FIFO) method) or net realizable value. Cost includes material, labor, and overhead. Inventories consisted of the following at:
| March 31, | December 31, | ||||||||||
| (In thousands) | 2026 | 2025 | |||||||||
| Raw materials | $ | $ | |||||||||
| Work in process | |||||||||||
| Finished goods | |||||||||||
| Inventories, net | $ | $ | |||||||||
At March 31, 2026 and December 31, 2025, the Company had recorded inventory obsolescence reserves of $81.3 million and $80.4 million, respectively.
14
LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
6. FIXED ASSETS
Fixed assets consisted of the following at:
| March 31, | December 31, | ||||||||||
| (In thousands) | 2026 | 2025 | |||||||||
| Fixed assets, at cost | $ | $ | |||||||||
| Less accumulated depreciation and amortization | |||||||||||
| Fixed assets, net | $ | $ | |||||||||
7. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES
Accrued expenses and other current liabilities consisted of the following at:
| March 31, | December 31, | ||||||||||
| (In thousands) | 2026 | 2025 | |||||||||
| Employee compensation and benefits | $ | $ | |||||||||
| Current portion of accrued warranty | |||||||||||
| Customer rebates | |||||||||||
| Other | |||||||||||
| Accrued expenses and other current liabilities | $ | $ | |||||||||
Estimated costs related to product warranties are accrued at the time products are sold. In estimating its future warranty obligations, the Company considers various factors, including the Company's historical warranty costs, warranty claim lag, and sales. The following table provides a reconciliation of the activity related to the Company's accrued warranty, including both the current and long-term portions, for the three months ended March 31:
| (In thousands) | 2026 | 2025 | |||||||||
| Balance at beginning of period | $ | $ | |||||||||
| Provision for warranty expense issued during the period | |||||||||||
| Provision for warranty expense for preexisting warranties | |||||||||||
| Warranty costs paid | ( | ( | |||||||||
| Balance at end of period | |||||||||||
| Less long-term portion | ( | ( | |||||||||
| Current portion of accrued warranty at end of period | $ | $ | |||||||||
15
LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
8. LONG-TERM INDEBTEDNESS
Long-term debt consisted of the following at:
| March 31, | December 31, | ||||||||||
| (In thousands) | 2026 | 2025 | |||||||||
| 2030 Convertible Notes | $ | $ | |||||||||
| 2026 Convertible Notes | |||||||||||
| Term Loan | |||||||||||
| Revolving Credit Loan | |||||||||||
| Other | |||||||||||
| Unamortized deferred financing fees | ( | ( | |||||||||
| Less current portion | ( | ( | |||||||||
| Long-term indebtedness | $ | $ | |||||||||
Credit Agreement
The Company and certain of its subsidiaries are party to a credit agreement dated March 25, 2025 with JPMorgan Chase, N.A., as a lender and administrative agent, and other bank lenders, which was amended by an Amendment No. 1 dated September 26, 2025 ("Amendment No. 1" and the credit agreement as amended, the "Credit Agreement"). The Credit Agreement provides for a $600.0 million revolving credit facility (of which up to $50.0 million is available for the issuance of letters of credit (the "LC Facility") and up to $400.0 million is available in approved foreign currencies). The Credit Agreement also provides for term loans (the "Term Loans") to the Company in an aggregate principal amount of $400.0 million. The maturity date of the Term Loans is March 25, 2032 and the maturity date of the revolving credit facility is March 25, 2030 or, if earlier, the date that is 91 days prior to the scheduled maturity date of any 2030 Convertible Notes outstanding at any such time or the date on which the revolving commitments are reduced to zero or otherwise terminated. The Term Loans are required to be repaid in equal $1.0 million quarterly installments, which commenced on June 30, 2025. The Credit Agreement also permits the Company to request incremental loans under the Credit Agreement and certain other incremental equivalent debt in an aggregate incremental amount equal to the sum of (A) up to the greater of (i) $371.0 million and (ii) an amount equal to 100% of EBITDA for the most recently ended four consecutive fiscal quarters for which financial statements have been delivered pursuant to the Credit Agreement (the “Fixed Incremental Amount”), (B) the amount of any voluntary prepayments of any term loans, incremental equivalent debt or permanent reductions of the revolving commitments as in effect as of the date of the Credit Agreement (which amount shall replenish, but not exceed, the Fixed Incremental Amount), and (C) an unlimited additional amount of additional debt that meets certain requirements set forth in the Credit Agreement, including limitations on any incremental facility that is secured on a pari passu basis or junior basis with the debt under the Credit Agreement, in each case subject to the willingness of the lenders to fund such increase and other customary conditions as further set forth in the Credit Agreement.
Borrowings under the Credit Agreement in U.S. dollars are designated from time to time by the Company to bear interest at either (i) a base rate plus an applicable margin which (a) for borrowings under the revolving credit facility, ranges from 0.25 percent to 1.00 percent depending on the Company's total net leverage ratio (0.50 percent would have been applicable at March 31, 2026 if the Company had elected base rate loans for any revolving credit facility borrowings) and (b) for Term Loans, is 1.25 percent or (ii) a term Secured Overnight Financing Rate ("SOFR") for an interest period selected by the Company plus an applicable margin, which (a) for borrowings under the revolving credit facility ranges from 1.25 percent to 2.00 percent (1.50 percent would have been applicable at March 31, 2026 if the Company had elected term benchmark loans for any revolving credit facility borrowings) depending on the Company’s total net leverage ratio and (b) for any Term Loans, is 2.25 percent. Foreign currency borrowings bear interest at an index rate available in such currencies plus the same additional interest margins applicable to term SOFR benchmark loans under the revolving credit facility based on the Company's total net leverage ratio. At March 31, 2026, the Company had $4.8 million in issued, but undrawn, standby letters of credit under the LC Facility. A commitment fee ranging from 0.175 percent to 0.275 percent (0.200 percent was applicable at March 31, 2026) depending on the Company's total net leverage ratio accrues on the actual daily amount that the revolving commitment exceeds the revolving credit exposure.
16
LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Pursuant to the Credit Agreement, the Company shall not permit its net leverage ratio to exceed certain limits, shall maintain a minimum interest coverage ratio, and must comply with certain other covenants. At March 31, 2026, the Company was in compliance with all financial covenants. The maximum net leverage ratio covenant limits the amount of consolidated outstanding indebtedness that the Company may incur on a trailing twelve-month EBITDA, and there are certain other limitations on the incurrence of indebtedness under the Credit Agreement. Availability under the Company’s revolving credit facility was $595.2 million at March 31, 2026. The Company believes the availability under the revolving credit facility under the Credit Agreement, along with its cash flows from operations, are adequate to finance the Company's anticipated cash requirements for the next twelve months.
At March 31, 2026, the fair value of the Company's floating rate long-term debt under the Credit Agreement approximates the carrying value, as estimated using quoted market prices and discounted future cash flows based on similar borrowing arrangements.
In March 2025, the Company used a portion of the proceeds of the Term Loans to repay the remaining outstanding principal of the term loan under the previous credit agreement of $280.0 million, and the previous credit agreement was terminated. The Company recognized a loss on extinguishment of debt related to the previous term loan of $1.9 million during the three months ended March 31, 2025. As described above, in September 2025, the Company entered into Amendment No. 1 to reprice the Term Loans, resulting in a reduction in the applicable margins by 0.25 percent.
Convertible Notes
2030 Convertible Notes
On March 14, 2025, the Company issued $460.0 million in aggregate principal amount of 2030 Convertible Notes in a private placement to certain qualified institutional buyers, resulting in net proceeds to the Company of approximately $447.0 million after deducting the initial purchasers’ discounts and offering expenses paid by the Company. The 2030 Convertible Notes bear interest at a coupon rate of 3.000 percent per annum, payable semiannually in arrears on March 1 and September 1 of each year, beginning on September 1, 2025. The 2030 Convertible Notes will mature on March 1, 2030, unless earlier converted, redeemed, or repurchased, in accordance with their terms.
As of March 31, 2026, the conversion rate of the 2030 Convertible Notes was 8.5745 shares of the Company’s common stock per $1,000 principal amount of the 2030 Convertible Notes. The conversion rate of the 2030 Convertible Notes is subject to further adjustment upon the occurrence of certain specified events. In addition, upon the occurrence of a make-whole fundamental change (as defined in the 2030 Notes Indenture) or upon a notice of redemption, the Company will, in certain circumstances, increase the conversion rate for a holder that elects to convert its 2030 Convertible Notes in connection with such make-whole fundamental change or notice of redemption, as the case may be.
Prior to the close of business on the business day immediately preceding November 1, 2029, the 2030 Convertible Notes are convertible at the option of the holders only under certain circumstances as set forth in the 2030 Notes Indenture. On or after November 1, 2029, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of their 2030 Convertible Notes at any time. Upon conversion, the Company will pay cash up to the aggregate principal amount of the 2030 Convertible Notes to be converted and pay or deliver, as the case may be, cash, shares of the Company's common stock, or a combination of cash and shares of the Company's common stock, at the Company's election, in respect of the remainder, if any, of the Company's conversion obligation in excess of the aggregate principal amount of the 2030 Convertible Notes being converted.
The Company may not redeem the 2030 Convertible Notes prior to March 6, 2028, except in the event of a Cleanup Redemption (as defined below). Beginning on March 6, 2028, the Company may redeem for cash all or any portion of the 2030 Convertible Notes, at the Company's option, if (i) the last reported sale price of the Company's common stock has been at least 130 percent of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption and (ii) the Liquidity Conditions (as defined in the 2030 Notes Indenture) are met at a redemption price equal to 100 percent of the principal amount of the 2030 Convertible Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. In addition, the Company may redeem for cash all, but not less than all, of the 2030 Convertible Notes at any time at a redemption price equal to 100 percent of the principal amount of the 2030 Convertible Notes to be redeemed, plus accrued and unpaid interest to, but excluding the redemption date if (i) the amount of the 2030 Convertible Notes that remains outstanding is less than 25 percent of the aggregate principal amount of the 2030 Convertible Notes initially issued under the 2030 Notes Indenture and (ii) the
17
LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Liquidity Conditions are met (such redemption, a “Cleanup Redemption”). Upon the occurrence of a fundamental change (as defined in the 2030 Notes Indenture), subject to certain conditions and a limited exception, holders of the 2030 Convertible Notes may require the Company to repurchase for cash all or any portion of their 2030 Convertible Notes in principal amounts of $1,000 or an integral multiple thereof at a repurchase price equal to 100 percent of the principal amount of the 2030 Convertible Notes to be repurchased, plus accrued and unpaid interest on such 2030 Convertible Notes to, but excluding, the fundamental change repurchase date (as defined in the 2030 Notes Indenture).
The 2030 Convertible Notes are senior unsecured obligations and rank senior in right of payment to all of the Company's indebtedness that is expressly subordinated in right of payment to the 2030 Convertible Notes, equal in right of payment with all the Company's liabilities that are not so subordinated, effectively junior to any of the Company's secured indebtedness to the extent of the value of the assets securing such indebtedness, and structurally junior to all indebtedness and other liabilities (including trade payables) of the Company's subsidiaries. The 2030 Notes Indenture contains customary terms and covenants, including that upon certain events of default occurring and continuing, either the named trustee or the holders of at least 25 percent of the aggregate principal amount of the outstanding 2030 Convertible Notes may declare 100 percent of the principal of, and accrued and unpaid interest, if any, on all the outstanding 2030 Convertible Notes to be due and payable.
The 2030 Convertible Notes are not registered securities nor listed on any securities exchange but may be actively traded by qualified institutional buyers. The fair value of the 2030 Convertible Notes of $556.0 million at March 31, 2026 was estimated using Level 1 inputs, as it is based on quoted prices for these instruments in active markets.
2026 Convertible Notes
On May 13, 2021, the Company issued $460.0 million in aggregate principal amount of 2026 Convertible Notes in a private placement to certain qualified institutional buyers, resulting in net proceeds to the Company of approximately $447.8 million after deducting the initial purchasers' discounts and offering expenses paid by the Company. The 2026 Convertible Notes bear interest at a coupon rate of 1.125 percent per annum, payable semiannually in arrears on May 15 and November 15 of each year, beginning on November 15, 2021. The 2026 Convertible Notes will mature on May 15, 2026, unless earlier converted, redeemed, or repurchased, in accordance with their terms.
As of March 31, 2026, the conversion rate of the 2026 Convertible Notes was 6.3691 shares of the Company's common stock per $1,000 principal amount of the 2026 Convertible Notes. The conversion rate of the 2026 Convertible Notes is subject to further adjustment upon the occurrence of certain specified events. In addition, upon the occurrence of a make-whole fundamental change (as defined in the 2026 Notes Indenture) or upon a notice of redemption, the Company will, in certain circumstances, increase the conversion rate for a holder that elects to convert its 2026 Convertible Notes in connection with such make-whole fundamental change or notice of redemption, as the case may be.
Until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of their 2026 Convertible Notes at any time. Upon conversion, the Company will pay cash up to the aggregate principal amount of the 2026 Convertible Notes to be converted. Additionally, the Company has provided the trustee of the 2026 Convertible Notes notice of the Company's election to settle in cash, in respect of the remainder, if any, of the Company's conversion obligation in excess of the aggregate principal amount of the 2026 Convertible Notes being converted.
Beginning on May 20, 2024, the Company may redeem for cash all or any portion of the 2026 Convertible Notes, at the Company's option, if the last reported sale price of the Company's common stock has been at least 130 percent of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption at a redemption price equal to 100 percent of the principal amount of the 2026 Convertible Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. Upon the occurrence of a fundamental change (as defined in the 2026 Notes Indenture), subject to certain conditions, holders of the 2026 Convertible Notes may require the Company to repurchase for cash all or any portion of their 2026 Convertible Notes in principal amounts of $1,000 or an integral multiple thereof at a repurchase price equal to 100 percent of the principal amount of the 2026 Convertible Notes to be repurchased, plus accrued and unpaid interest on such 2026 Convertible Notes to, but not including, the fundamental change repurchase date (as defined in the 2026 Notes Indenture).
The 2026 Convertible Notes are senior unsecured obligations and rank senior in right of payment to all of the Company's indebtedness that is expressly subordinated in right of payment to the 2026 Convertible Notes, equal in right of payment with all the Company's liabilities that are not so subordinated, effectively junior to any of the Company's secured
18
LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
indebtedness to the extent of the value of the assets securing such indebtedness, and structurally junior to all indebtedness and other liabilities (including trade payables) of the Company's subsidiaries. The 2026 Notes Indenture contains customary terms and covenants, including that upon certain events of default occurring and continuing, either the named trustee or the holders of at least 25 percent of the aggregate principal amount of the outstanding 2026 Convertible Notes may declare 100 percent of the principal of, and accrued and unpaid interest, if any, on all the outstanding 2026 Convertible Notes to be due and payable.
The 2026 Convertible Notes are not registered securities nor listed on any securities exchange but may be actively traded by qualified institutional buyers. The fair value of the 2026 Convertible Notes of $91.6 million at March 31, 2026 was estimated using Level 1 inputs, as it is based on quoted prices for these instruments in active markets.
On March 14, 2025, the Company settled certain separate, privately negotiated transactions (the "2026 Convertible Note Repurchases") with certain holders of the 2026 Convertible Notes to repurchase $368.0 million aggregate principal amount of the 2026 Convertible Notes using $370.3 million of the net proceeds received from the issuance of the 2030 Convertible Notes. In connection with the 2026 Convertible Note Repurchases, the Company recorded a loss on extinguishment of debt of $6.2 million. Concurrently with the 2026 Convertible Note Repurchases, the Company entered into agreements to terminate a proportionate amount of the 2026 Warrants and the 2026 Convertible Note Hedge Transactions, which resulted in net proceeds to the Company of $1.4 million.
9. LEASES
The Company leases certain manufacturing and warehouse facilities, administrative office space, semi-tractors, trailers, forklifts, and other equipment through operating leases with unrelated third parties. The components of lease expense were as follows:
| Three Months Ended March 31, | |||||||||||
| (In thousands) | 2026 | 2025 | |||||||||
| Operating lease expense | $ | $ | |||||||||
| Short-term lease expense | |||||||||||
| Variable lease expense | |||||||||||
| Total lease expense | $ | $ | |||||||||
10. COMMITMENTS AND CONTINGENCIES
Holdback Payments and Contingent Consideration
From time to time, the Company finances a portion of its business combinations with deferred acquisition payments ("holdback payments") and/or contingent earnout provisions. Holdback payments are accrued at their discounted present value. As required, the liability for contingent consideration is measured at fair value quarterly, considering actual sales of the acquired products, updated sales projections, and the updated market participant weighted average cost of capital. Depending upon the weighted average costs of capital and future sales of the products which are subject to contingent consideration, the Company could record adjustments in future periods. Holdback payment and contingent consideration balances were not material at March 31, 2026.
Product Recalls
From time to time, the Company cooperates with, and assists its customers on, their product recalls and inquiries, and occasionally receives inquiries directly from the National Highway Traffic Safety Administration regarding reported incidents involving the Company’s products. As a result, the Company has incurred expenses associated with product recalls from time to time and may incur expenditures for future investigations or product recalls. Product recall reserves were not material at March 31, 2026.
19
LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Environmental
The Company's operations are subject to certain complex Federal, state, and local regulatory requirements governing the use, storage, handling, discharge, transport, and disposal of hazardous materials during the manufacturing processes. Although the Company believes its operations have been consistent with prevailing industry standards and are in substantial compliance with applicable environmental laws and regulations, one or more of the Company’s current or former operating sites, or adjacent sites owned by third-parties, have been affected, and may in the future be affected, by releases of hazardous materials. As a result, the Company may incur expenditures for future investigation and remediation of these sites, including in conjunction with voluntary remediation programs or third-party claims. Environmental reserves were not material at March 31, 2026.
Litigation
In the normal course of business, the Company is subject to proceedings, lawsuits, regulatory agency inquiries, and other claims. All such matters are subject to uncertainties and outcomes that are not predictable with assurance. While these matters could materially affect operating results when resolved in future periods, management believes that, after final disposition, including anticipated insurance recoveries in certain cases, any monetary liability or financial impact to the Company beyond that provided in the Condensed Consolidated Balance Sheet as of March 31, 2026, would not be material to the Company's financial position or results of operations.
11. STOCKHOLDERS' EQUITY
The following table summarizes information about shares of the Company's common stock at:
| March 31, | December 31, | ||||||||||
| (In thousands) | 2026 | 2025 | |||||||||
| Common stock authorized | |||||||||||
| Common stock issued | |||||||||||
| Treasury stock | |||||||||||
| Common stock outstanding | |||||||||||
The table below summarizes the regular quarterly dividends declared and paid during the periods ended March 31, 2026 and December 31, 2025:
| (In thousands, except per share data) | Per Share | Record Date | Payment Date | Total Paid | |||||||||||||||||||
| First Quarter 2025 | $ | 03/07/25 | 03/21/25 | $ | |||||||||||||||||||
| Second Quarter 2025 | 05/30/25 | 06/13/25 | |||||||||||||||||||||
| Third Quarter 2025 | 08/29/25 | 09/12/25 | |||||||||||||||||||||
| Fourth Quarter 2025 | 11/28/25 | 12/12/25 | |||||||||||||||||||||
| Total 2025 | $ | $ | |||||||||||||||||||||
| First Quarter 2026 | $ | 03/13/26 | 03/27/26 | $ | |||||||||||||||||||
Deferred and Restricted Stock Units
The LCI Industries 2018 Omnibus Incentive Plan (the "2018 Plan") provides for the grant or issuance of stock units, including those that have deferral periods, such as deferred stock units ("DSUs"), and those with time-based vesting provisions, such as restricted stock units ("RSUs"), to directors, employees, and other eligible persons. Recipients of DSUs and RSUs are entitled to receive shares at the end of a specified vesting or deferral period. Holders of DSUs and RSUs receive dividend equivalents based on dividends granted to holders of the common stock, which dividend equivalents are payable in additional DSUs and RSUs, and are subject to the same vesting criteria as the original grant. DSUs vest (i) ratably over the service period, (ii) at a specified future date, or (iii) for certain officers, based on achievement of specified performance conditions. RSUs vest
20
LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(i) ratably over the service period or (ii) at a specified future date. In addition, DSUs are issued in lieu of certain cash compensation. Transactions in DSUs and RSUs under the 2018 Plan are summarized as follows:
| Number of Shares | Weighted Average Price | ||||||||||
| Outstanding at December 31, 2025 | $ | ||||||||||
| Issued | |||||||||||
| Granted | |||||||||||
| Dividend equivalents | |||||||||||
| Forfeited | ( | ||||||||||
| Vested | ( | ||||||||||
| Outstanding at March 31, 2026 | $ | ||||||||||
Performance Stock Units
The 2018 Plan provides for performance stock units ("PSUs") that vest at a specific future date based on achievement of specified performance conditions. Transactions in PSUs under the 2018 Plan are summarized as follows:
| Number of Shares | Weighted Average Price | ||||||||||
| Outstanding at December 31, 2025 | $ | ||||||||||
| Granted | |||||||||||
| Dividend equivalents | |||||||||||
| Forfeited | ( | ||||||||||
| Outstanding at March 31, 2026 | $ | ||||||||||
Stock Repurchase Programs
In May 2022, the Company's Board of Directors authorized a stock repurchase program (the "2022 Share Repurchase Program") granting the Company authority to repurchase up to $200.0 million of the Company's common stock over a three-year period, which ended on May 19, 2025. The timing of stock repurchases, and the number of shares, were dependent upon market conditions and other factors. Share repurchases could be made in the open market and/or in privately negotiated transactions in accordance with applicable securities laws. The stock repurchase program was subject to modification, suspension, or termination at any time by the Board of Directors. In March 2025, the Company purchased 308,898 shares at a weighted average price of $91.47 per share, totaling $28.4 million, including excise tax, under the 2022 Share Repurchase Program. Following such repurchase, no additional shares were purchased under the 2022 Share Repurchase Program prior to its expiration on May 19, 2025.
In May 2025, the Company's Board of Directors authorized a new stock repurchase program (the "2025 Share Repurchase Program") for the purchase of up to $300.0 million of the Company's common stock over a three-year period ending on May 15, 2028. The timing of stock repurchases, and the number of shares, will depend upon market conditions and other factors. Share repurchases, if any, will be made in privately negotiated and/or open market transactions, such as in compliance with Rule 10b-18 of the Securities Act of 1934, as amended (the "Exchange Act"), and/or pursuant to a trading plan in accordance with Rule 10b5-1 of the Exchange Act, or a combination of methods. The stock repurchase program may be modified, suspended, or terminated at any time by the Board of Directors. No shares were repurchased during the three months ended March 31, 2026. As of March 31, 2026, there was $200.0 million remaining for the repurchase of shares under the 2025 Share Repurchase Program.
12. SEGMENT REPORTING
The Company has
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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
The OEM Segment, which accounted for 78 percent and 79 percent of consolidated net sales for the three months ended March 31, 2026 and 2025, respectively, manufactures and distributes a broad array of highly engineered components for the leading OEMs in the recreation and transportation markets, consisting of RVs and adjacent industries, including boats; buses; trailers used to haul boats, livestock, equipment, and other cargo; trucks; trains; manufactured homes; and modular housing. Approximately 52 percent of the Company's OEM Segment net sales for the three months ended March 31, 2026 were of components for travel trailer and fifth-wheel RVs.
The Aftermarket Segment, which accounted for 22 percent and 21 percent of consolidated net sales for the three months ended March 31, 2026 and 2025, respectively, supplies engineered components to the related aftermarket channels of the recreation and transportation markets, primarily to retail dealers, wholesale distributors, and service centers, as well as direct-to-consumer sales through online platforms. The Aftermarket Segment also includes biminis, covers, buoys, and fenders to the marine industry, towing products, truck accessories, appliances, air conditioners, televisions, sound systems, tankless water heaters, and the sale of replacement glass and awnings to fulfill insurance claims.
The Company's chief operating decision maker ("CODM") is its President and Chief Executive Officer. The decisions concerning the allocation of the Company's resources are made by the CODM with oversight by the Board of Directors. The CODM evaluates the performance of each segment and makes decisions concerning the allocation of resources based upon segment operating profit, generally defined as income before interest expense and income taxes. Segment assets are not reviewed by the CODM and therefore are not disclosed below. Management of debt is a corporate function. The accounting policies of the OEM and Aftermarket Segments are the same as those described in Note 2 of the Notes to Consolidated Financial Statements in the Company's Annual Report on Form 10-K for the year ended December 31, 2025.
The following tables present the Company's revenues disaggregated by segment and geography based on the billing address of the Company's customers:
| Three Months Ended March 31, 2026 | Three Months Ended March 31, 2025 | ||||||||||||||||||||||||||||||||||
| (In thousands) | U.S. (a) | Int’l (b) | Total | U.S. (a) | Int’l (b) | Total | |||||||||||||||||||||||||||||
| OEM Segment: | |||||||||||||||||||||||||||||||||||
| RV OEMs: | |||||||||||||||||||||||||||||||||||
| Travel trailers and fifth-wheels | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Motorhomes | |||||||||||||||||||||||||||||||||||
| Adjacent Industries OEMs | |||||||||||||||||||||||||||||||||||
| Total OEM Segment net sales | |||||||||||||||||||||||||||||||||||
| Aftermarket Segment: | |||||||||||||||||||||||||||||||||||
| Total Aftermarket Segment net sales | |||||||||||||||||||||||||||||||||||
| Total net sales | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
(b) Net sales to customers domiciled in countries outside of the United States of America
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LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Corporate expenses are allocated between the segments based upon net sales. Accretion related to contingent consideration and other non-segment items are included in the segment to which they relate. Information relating to segments follows:
| Three Months Ended March 31, 2026 | Three Months Ended March 31, 2025 | ||||||||||||||||||||||||||||||||||
| (In thousands) | OEM | Aftermarket | Total | OEM | Aftermarket | Total | |||||||||||||||||||||||||||||
Net sales to external customers | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
| Cost of sales | |||||||||||||||||||||||||||||||||||
| Gross profit | |||||||||||||||||||||||||||||||||||
| Selling, general and administrative expenses | |||||||||||||||||||||||||||||||||||
| Operating profit | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
The following table presents the Company's revenue disaggregated by product:
| Three Months Ended March 31, | |||||||||||
| (In thousands) | 2026 | 2025 | |||||||||
| OEM Segment: | |||||||||||
| Chassis, chassis parts, and slide-out mechanisms | $ | $ | |||||||||
| Windows and doors | |||||||||||
| Furniture and mattresses | |||||||||||
| Axles, ABS, and suspension solutions | |||||||||||
| Appliances | |||||||||||
| Other | |||||||||||
| Total OEM Segment net sales | |||||||||||
| Total Aftermarket Segment net sales | |||||||||||
| Total net sales | $ | $ | |||||||||
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LCI INDUSTRIES
ITEM 2 – MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
This Management's Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the Company's Condensed Consolidated Financial Statements and Notes thereto included in Item 1 of Part I of this report, as well as the Company's Annual Report on Form 10-K for the year ended December 31, 2025.
LCI Industries ("LCII" and collectively with its subsidiaries, the "Company," the "Registrant," "we," "us," or "our"), through its wholly-owned subsidiary, Lippert Components, Inc. and its subsidiaries (collectively, "Lippert Components," "LCI," or "Lippert"), is a global leader in supplying engineered components to the outdoor recreation, transportation, marine, and housing industries. In addition to serving original equipment manufacturers ("OEMs"), we also cater to aftermarket needs, selling through retail dealers, wholesale distributors, and service centers, as well as direct-to-consumer sales through online platforms.
Our diverse portfolio of innovative and high-quality products includes:
•Chassis and Suspension Solutions: Steel chassis, axles, anti-lock braking systems ("ABS"), and suspension systems
•Furniture Solutions: Furniture for RV, marine and other markets, and mattresses
•Window and Glass Solutions: Vinyl, aluminum, and frameless windows, and windshields
•Appliance and Kitchen Solutions: Air conditioners, tankless water heaters, appliances, electronic components, televisions, and thermoformed bath and kitchen products
•Towing and Truck Accessories: Hitches, pin boxes, grill guards, towing electrical, and towing and truck accessories
•Doors, Steps, and Awnings: Entry, luggage, patio, and ramp doors, electric and manual entry steps, and awnings
•Leveling, Stabilization, and Slide-outs: Stabilizer/leveling systems (manual, electric, and hydraulic), and slide-out solutions
At March 31, 2026, we operated over 100 manufacturing facilities located throughout North America and Europe, supporting key industries such as recreational vehicles ("RVs"), transportation, marine, and housing. Our core manufacturing competencies include:
•Metal fabrication and welding | •Glass fabrication | ||||
•Furniture manufacturing | •Electronics | ||||
•Lamination | •Power & motion systems | ||||
•E-Coating and powder coating | •Plastics Forming | ||||
•Appliances | |||||
We operate in two primary segments: OEM and Aftermarket. Together, these segments leverage our manufacturing competencies, leadership expertise, customer relationships, and market insights to drive efficiencies and innovation that enable us to maintain a leading position in the RV market while continuing to expand in adjacent industries and aftermarket channels. Intersegment sales are insignificant. See Note 12 of the Notes to Condensed Consolidated Financial Statements for further information regarding our segments.
OEM Segment: Our OEM Segment services leading OEMs in RV, transportation, marine, and housing markets. Our strategically located manufacturing and distribution facilities across North America and Europe provide efficient service to OEMs. Key markets served by our OEM Segment include RVs and Adjacent Industries.
Aftermarket Segment: Our Aftermarket Segment enhances the product lifecycle for the RV, transportation, marine, and automotive markets by offering discretionary accessories, replacement parts, and upgrades. This approach drives additional revenue, deepens customer engagement, and leverages our OEM expertise. Products are sold through retail dealers, wholesale distributors, and service centers, as well as direct-to-consumer sales through online platforms.
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LCI INDUSTRIES
ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
Diversification Strategy: Over the past several years, we have diversified our portfolio beyond the RV OEM market into transportation, marine, housing, and aftermarket sectors. We have also diversified geographically through our international operations. Leveraging our manufacturing competencies in other industries can accelerate profitable growth and help to mitigate seasonal and cyclical market risk. For example, within our Aftermarket Segment, many of the optional upgrades and non-critical replacement parts for RVs are purchased outside the normal product selling season, thereby causing certain sales within this segment to be counter-seasonal.
Most industries where we sell products, or where our products are used, historically have been seasonal and are generally at the highest levels when the weather is moderate. Accordingly, our sales and profits have generally been the highest in the second quarter and lowest in the fourth quarter. However, because of fluctuations in dealer inventories, the impact of international, national, and regional economic conditions, consumer confidence on retail sales of RVs and other products for which we sell our components, the timing of dealer orders, and the impact of severe weather conditions on the timing of industry-wide shipments from time to time, current and future seasonal industry trends have been, and may in the future be, different than in prior years. Additionally, many of the optional upgrades and non-critical replacement parts for RVs are purchased outside the normal product selling season, thereby causing certain Aftermarket Segment sales to be counter-seasonal.
Negative conditions in the general economy in the United States or abroad, including conditions resulting from financial and credit market fluctuations, elevated inflation and interest rates, changes in economic policy, trade uncertainty, including changes in tariffs, sanctions, international treaties, and other trade restrictions, geopolitical tensions, armed conflicts, natural disasters, or global public health crises, have negatively impacted, and could continue to negatively impact, the Company’s business, liquidity, financial condition, and results of operations.
INDUSTRY BACKGROUND
OEM Segment - North American Recreational Vehicle Industry: RVs are designed as temporary living quarters for recreational, camping, travel, or seasonal use. They can be either motorized, such as motorhomes, or towable, including travel trailers, fifth-wheel trailers, folding camping trailers, and truck campers. The RV industry generally follows a predictable annual sales cycle that starts after the annual fall "Open House" in Elkhart, Indiana:
•October - March: Dealers build inventory, leading wholesale shipments to historically outpace retail sales.
•April - September: Retail sales typically exceed wholesale shipments, driven by spring and summer demand.
In the first three months of 2026 compared to the same period in 2025, Recreation Vehicle Industry Association ("RVIA") data shows United States wholesale shipments of travel trailer and fifth-wheel RVs, the Company's primary market, decreased 15 percent to 73,400 units. Retail demand for travel trailer and fifth-wheel RVs decreased 17 percent to 52,200 units in the first three months of 2026 compared to the same period in 2025. Retail registration data is often revised upward in subsequent months due to reporting delays.
While we track our OEM Segment RV sales against wholesale shipment statistics, the health of the RV industry is ultimately determined by retail demand. The table below highlights trends in wholesale shipments, retail sales, and dealer inventory adjustments for travel trailers and fifth-wheel RVs, as reported by Statistical Surveys, Inc. ("Statistical Surveys").
| Estimated | |||||||||||||||||||||||||||||
| Wholesale | Retail | Unit Impact on | |||||||||||||||||||||||||||
| Units | Change | Units | Change | Dealer Inventories | |||||||||||||||||||||||||
| Quarter ended March 31, 2026 | 73,400 | (15)% | 52,200 | (17)% | 21,200 | ||||||||||||||||||||||||
| Quarter ended December 31, 2025 | 64,700 | (4)% | 52,200 | (6)% | 12,500 | ||||||||||||||||||||||||
| Quarter ended September 30, 2025 | 65,700 | (4)% | 90,700 | 3% | (25,000) | ||||||||||||||||||||||||
| Quarter ended June 30, 2025 | 81,400 | (1)% | 100,700 | 2% | (19,300) | ||||||||||||||||||||||||
| Twelve months ended March 31, 2026 | 285,200 | (6)% | 295,800 | (3)% | (10,600) | ||||||||||||||||||||||||
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LCI INDUSTRIES
ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
| Estimated | |||||||||||||||||||||||||||||
| Wholesale | Retail | Unit Impact on | |||||||||||||||||||||||||||
| Units | Change | Units | Change | Dealer Inventories | |||||||||||||||||||||||||
| Quarter ended March 31, 2025 | 86,400 | 18% | 62,700 | (4)% | 23,700 | ||||||||||||||||||||||||
| Quarter ended December 31, 2024 | 67,700 | 7% | 55,400 | 3% | 12,300 | ||||||||||||||||||||||||
| Quarter ended September 30, 2024 | 68,500 | 11% | 87,800 | (5)% | (19,300) | ||||||||||||||||||||||||
| Quarter ended June 30, 2024 | 82,000 | 15% | 99,100 | (9)% | (17,100) | ||||||||||||||||||||||||
| Twelve months ended March 31, 2025 | 304,600 | 13% | 305,000 | (5)% | (400) | ||||||||||||||||||||||||
In the first three months of 2026 compared to the same period in 2025, RVIA data showed wholesale shipments of motorhome RVs increased 15 percent to 10,700 units. Retail demand for motorhome RVs decreased 24 percent to 6,800 units in the first three months of 2026 compared to the same period of 2025. Retail demand has declined from post-pandemic elevated levels, primarily driven by inflation and higher interest rates impacting retail consumer discretionary spending.
OEM Segment - Adjacent Industries: Our expertise in RV components extends to adjacent industries, including transportation, marine, and housing. These adjacent industries offer significant growth opportunities, including by helping us leverage our established relationships with OEMs that often operate in multiple sectors. While the potential content per unit we may supply to adjacent industries varies across these markets, and is different than RVs, they represent meaningful diversification opportunities.
Aftermarket Segment: Our Aftermarket Segment enhances the product lifecycle for the RV, transportation, marine, and automotive markets by offering discretionary accessories, replacement parts, and upgrades through various channels, including retail dealers, wholesale distributors, and service centers, as well as direct-to-consumer sales through online platforms. These products support recreation and transportation markets, addressing both routine maintenance needs and customer-driven enhancements.
We also provide comprehensive customer support through multiple customer care centers, offering rapid responses to inquiries related to technical support, product delivery, and critical repair, designed to minimize consumer downtime. Dedicated teams deliver product, technical, and installation training, as well as marketing assistance, to enhance customer engagement and satisfaction.
Aftermarket offerings span a diverse product portfolio, including:
•Marine Products: Biminis, covers, buoys, and fenders.
•Recreation and Transportation Accessories: Towing products, truck accessories, replacement glass, and awnings.
•Core Systems: Appliances, air conditioners, televisions, sound systems, and tankless water heaters.
Aftermarket sales are influenced by seasonal trends, with many non-critical upgrades and replacement parts purchased outside peak selling periods, creating certain counter-seasonal demand.
The U.S. RV ownership base, which reached a record 8.1 million households in 2025 according to the RVIA, drives robust demand for aftermarket products. Owners seek to enhance and maintain their units, replacing components that experience normal wear and tear. This vibrant and growing market represents a key driver of our Aftermarket Segment’s performance.
26
LCI INDUSTRIES
ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
RESULTS OF OPERATIONS
Consolidated Highlights
•Consolidated net sales in the first quarter of 2026 were $1.1 billion, an increase of 4.3 percent, from $1.0 billion in the same period of 2025. The increase was primarily due to sales price increases to cover higher material costs, sales from acquired businesses, North American RV sales driven by recent innovations, and an increased mix of higher content fifth-wheel units, partially offset by lower North American RV wholesale shipments. Net sales from acquisitions completed in the twelve months ended March 31, 2026 contributed approximately $46.8 million in the first quarter of 2026.
•Net income for the first quarter of 2026 was $62.9 million, or $2.53 per diluted share, compared to net income of $49.4 million, or $1.94 per diluted share, for the same period of 2025.
•Consolidated operating profit during the first quarter of 2026 was $95.2 million, compared to $81.3 million in the same period of 2025. Operating profit margin was 8.7 percent in the first quarter of 2026 compared to 7.8 percent in the same period of 2025. The increase was primarily due to reduced costs as a result of materials sourcing strategies and the benefits of other cost improvement actions, such as the footprint optimizations.
•In the first quarter of 2026, we paid a quarterly dividend of $1.15 per share, aggregating to $27.9 million.
OEM Segment - First Quarter
Net sales of the OEM Segment in the first quarter of 2026 increased by $29.3 million, compared to the same period of 2025. Net sales of components to OEMs were to the following markets for the three months ended March 31:
| (In thousands) | 2026 | 2025 | Change | ||||||||||||||
| RV OEMs: | |||||||||||||||||
| Travel trailers and fifth-wheels | $ | 442,006 | $ | 471,194 | (6) | % | |||||||||||
| Motorhomes | 67,838 | 59,608 | 14 | % | |||||||||||||
| Adjacent Industries OEMs | 342,970 | 292,753 | 17 | % | |||||||||||||
| Total OEM Segment net sales | $ | 852,814 | $ | 823,555 | 4 | % | |||||||||||
According to the RVIA, industry-wide wholesale shipments for the three months ended March 31 were:
| 2026 | 2025 | Change | |||||||||||||||
| Travel trailers and fifth-wheels | 73,400 | 86,400 | (15) | % | |||||||||||||
| Motorhomes | 10,700 | 9,300 | 15 | % | |||||||||||||
The trend in our average product content per RV produced is an indicator of our continued engagement with our RV OEM customers. Our average product content per type of RV, calculated based upon our net sales of components to domestic RV OEMs for the different types of RVs produced for the twelve months ended March 31, divided by the industry-wide wholesale shipments of the different product mix of RVs for the same period, was:
| Content per: | 2026 | 2025 | Change | ||||||||||||||
| Travel trailer and fifth-wheel | $ | 5,826 | $ | 5,164 | 13 | % | |||||||||||
| Motorhome | $ | 3,970 | $ | 3,750 | 6 | % | |||||||||||
Our average product content per type of RV excludes international sales and sales to the Aftermarket Segment and Adjacent Industries. Content per RV is impacted by changes in selling prices for our products, product innovations, changes in unit mix, and acquisitions. For the twelve months ended March 31, 2026, travel trailer and fifth-wheel RV content increased 12.8 percent year-over year due to sales price increases to cover higher material costs, an increase in RV mix toward higher content fifth-wheel units, and recent innovations, partially offset by shipments exceeding units produced.
Our decrease in net sales to RV OEMs during the first quarter of 2026 was primarily due to a decrease in North American travel trailer and fifth-wheel shipments, partially offset by sales price increases to cover higher material costs, an increase in RV sales mix toward higher content fifth-wheel units, an increase in North American motorhome RV unit shipments, and recent innovations.
27
LCI INDUSTRIES
ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
Our increase in net sales to OEMs in Adjacent Industries during the first quarter of 2026 was primarily due to sales from acquired businesses and higher sales to North American marine OEMs.
Operating profit of the OEM Segment was $76.5 million in the first quarter of 2026, an increase of $14.5 million compared to the same period of 2025. The operating profit margin of the OEM Segment increased to 9.0 percent in the first quarter of 2026, compared to 7.5 percent for the same period of 2025, and was positively impacted by:
•Increases in selling prices for targeted products to cover increased material costs, which positively impacted operating profit by $31.6 million compared to the same period in 2025.
•Increases in selling prices contractually tied to indices of select commodities, which positively impacted operating profit by $16.7 million compared to the same period in 2025.
•Cost improvement actions, such as footprint optimizations, increased operating profit by $6.7 million compared to the same period in 2025.
•Reduced costs as a result of materials sourcing strategies, which increased operating profit by $6.4 million compared to the same period in 2025.
•A favorable shift in sales mix, which positively impacted operating profit by $4.3 million compared to the same period in 2025.
Partially offset by:
•Higher material costs related to tariffs and higher steel and aluminum costs, partially offset by a reduction in in-bound freight costs, which negatively impacted operating profit by $38.4 million compared to the same period in 2025.
•The impact of fixed costs spread over decreased production volumes, which decreased operating profit by $9.3 million related to fixed production overhead costs and $4.2 million related to fixed selling, general, and administrative costs.
Amortization expense on intangible assets for the OEM Segment was $9.4 million in the first quarter of 2026, compared to $9.1 million in the same period of 2025. Depreciation expense on fixed assets for the OEM Segment was $11.3 million in the first quarter of 2026, compared to $12.3 million in the same period of 2025.
Aftermarket Segment - First Quarter
Net sales of the Aftermarket Segment in the first quarter of 2026 increased by $15.7 million, compared to the same period of 2025. Net sales of components in the Aftermarket Segment were as follows for the three months ended March 31:
| (In thousands) | 2026 | 2025 | Change | ||||||||||||||
| Total Aftermarket Segment net sales | $ | 237,703 | $ | 222,035 | 7 | % | |||||||||||
Our net sales of the Aftermarket Segment for the first quarter of 2026 increased compared to the same period in 2025, primarily driven by price increases to cover higher material costs and acquisitions, partially offset by volume decreases in the automotive and marine aftermarkets.
Operating profit of the Aftermarket Segment was $18.7 million in the first quarter of 2026, a decrease of $0.7 million compared to the same period of 2025. The operating profit margin of the Aftermarket Segment was 7.8 percent in the first quarter of 2026, compared to 8.7 percent in the same period in 2025, and was negatively impacted by:
•Higher material costs related to tariffs and higher steel costs, partially offset by a reduction in in-bound freight costs, which negatively impacted operating profit by $11.2 million compared to the same period in 2025.
•Investments in capacity and distribution to support continued growth in the Aftermarket Segment, which negatively impacted operating profit by $5.6 million compared to the same period in 2025.
28
LCI INDUSTRIES
ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
Partially offset by:
•Increases in selling prices for targeted products primarily to cover increased material costs, which positively impacted operating profit by $11.6 million compared to the same period in 2025.
•Reduced costs as a result of materials sourcing strategies, which increased operating profit by $1.8 million compared to the same period in 2025.
•A favorable shift in sales mix, which positively impacted operating profit by $1.5 million compared to the same period in 2025.
Amortization expense on intangible assets for the Aftermarket Segment was $4.0 million in the first quarter of 2026, compared to $3.8 million in the same period of 2025. Depreciation expense on fixed assets for the Aftermarket Segment was $5.1 million in the first quarter of 2026, compared to $4.3 million in the same period of 2025.
Interest Expense
Interest expense, net was $9.9 million for the three months ended March 31, 2026, compared to $6.0 million in the same period of 2025. The increase in net interest expense was primarily due to interest on the 2030 Convertible Notes and increased principal borrowed on our Term Loans (as defined in Note 8 of the Notes to Condensed Consolidated Financial Statements) following our refinancing in March 2025.
See Note 8 of the Notes to Condensed Consolidated Financial Statements for a description of our credit facilities.
Loss on Extinguishment of Debt
In the three months ended March 31, 2025, we recorded an $8.1 million loss on extinguishment of debt, consisting of $6.2 million in connection with the repurchase of a portion of our 2026 Convertible Notes and $1.9 million related to the repayment of our previous term loan. No loss on extinguishment of debt was recorded for the three months ended March 31, 2026.
Income Taxes
The effective income tax rate for the three months ended March 31, 2026 and 2025 was 26.2 percent and 26.5 percent, respectively. The effective tax rate for the three months ended March 31, 2026 differed from the Federal statutory rate primarily due to state taxes, foreign taxes, and non-deductible expenses, partially offset by Federal and Indiana research and development credits. The decrease in the effective tax rate for the three months ended March 31, 2026 as compared to the same period in 2025 was primarily due to the recognition of excess tax benefits on stock-based compensation.
LIQUIDITY AND CAPITAL RESOURCES
Cash Flows
We maintain a level of cash and liquidity sufficient to allow us to meet our cash needs in the short term. Over the long term, we manage our cash and capital structure to maximize shareholder return, maintain our financial condition, and maintain flexibility for our future strategic investments. We continuously assess our capital requirements, working capital needs, debt and leverage levels, debt and lease maturity schedules, capital expenditure requirements, dividends, future investments or acquisitions, and potential share repurchases. We believe our operating cash flows, credit facilities, as well as any potential future borrowings, will be sufficient to fund our future payments and long-term initiatives.
As of March 31, 2026, we had $142.2 million in cash and cash equivalents, and $595.2 million of availability under our revolving credit facility under the Credit Agreement. We also have the ability to request an increase to the revolving and/or incremental term loan facilities by up to an additional $371.0 million in the aggregate upon approval of the lenders providing any such increase and the satisfaction of certain other conditions. See Note 8 of the Notes to Condensed Consolidated Financial Statements for a description of our credit facilities.
We believe the availability under the revolving credit facility under the Credit Agreement, along with our cash flows from operations, are adequate to finance our anticipated cash requirements for the next twelve months.
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LCI INDUSTRIES
ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
The Condensed Consolidated Statements of Cash Flows reflect the following for the three months ended March 31:
| (In thousands) | 2026 | 2025 | |||||||||
| Net cash flows (used in) provided by operating activities | $ | (33,459) | $ | 42,718 | |||||||
| Net cash flows used in investing activities | (9,599) | (42,040) | |||||||||
| Net cash flows (used in) provided by financing activities | (35,550) | 66,871 | |||||||||
| Effect of exchange rate changes on cash and cash equivalents | (1,770) | (2,062) | |||||||||
| Net (decrease) increase in cash and cash equivalents | $ | (80,378) | $ | 65,487 | |||||||
Cash Flows from Operating Activities
Net cash flows used in operating activities were $33.5 million in the first three months of 2026, compared to cash provided by operating activities of $42.7 million in the first three months of 2025. The change in net cash flows used in operating activities was primarily due to the net change in assets and liabilities, which used $83.6 million more cash in the first three months of 2026 compared to the same period in 2025. The net change in assets and liabilities was partially offset by an increase in net income of $13.5 million. The primary use of cash in net assets was the increase of $134.5 million in accounts receivable due to seasonally higher sales in the first three months of 2026. Also driving the use of cash was the increase of $27.3 million in inventories, as inventory levels were replenished for the upcoming selling season, partially offset by an increase in accounts payable, trade.
Depreciation and amortization was $29.8 million in the first three months of 2026, and is expected to be approximately $115 to $125 million for the full year 2026. Non-cash stock-based compensation expense in the first three months of 2026 was $5.3 million. Non-cash stock-based compensation expense is expected to be approximately $24 to $27 million for the full year 2026.
Cash Flows from Investing Activities
Cash flows used in investing activities of $9.6 million in the first three months of 2026 were primarily comprised of $9.7 million for capital expenditures. Cash flows used in investing activities of $42.0 million in the first three months of 2025 were primarily comprised of $29.6 million for the acquisition of a business and $9.0 million for capital expenditures.
Our capital expenditures are primarily for replacement and growth. Over the long term, based on our historical capital expenditures, the replacement portion has averaged approximately one to two percent of net sales, while the growth portion has averaged approximately two to three percent of net sales. However, there are many factors that can impact the actual spending compared to these historical averages. We estimate full year 2026 capital expenditures of $55 to $75 million, including investments in automation and lean projects, which we expect to fund with cash flows from operations or periodic borrowings under the revolving credit facility.
Capital expenditures in the first three months of 2026 were funded by cash on hand. Capital expenditures and any acquisitions in the remainder of fiscal year 2026 are expected to be funded primarily from cash generated from operations, as well as periodic borrowings under our revolving credit facility.
Cash Flows from Financing Activities
Cash flows used in financing activities of $35.6 million in the first three months of 2026 were primarily comprised of payments of quarterly dividends of $27.9 million, cash outflows of $6.6 million related to the vesting of stock-based awards, net of shares tendered for payment of taxes, and net debt repayments of $1.0 million under our Term Loans.
Cash flows provided by financing activities of $66.9 million in the first three months of 2025 were primarily comprised of the following:
•net proceeds from the issuance of our 2030 Convertible Notes of $448.5 million,
•proceeds from Term Loan borrowings of $391.0 million,
•proceeds from the issuance of warrants of $27.6 million, and
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ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
•net proceeds of $1.4 million from the termination of a portion of our 2026 Warrants and 2026 Convertible Note Hedge Transactions,
Partially offset by:
•payments of $368.9 million for the repurchase of a portion of our 2026 Convertible Notes,
•debt repayments of $299.4 million under our revolving credit facility, Term Loan, and other borrowings,
•payments of $67.6 million for the purchase of convertible note hedge contracts,
•payments of quarterly dividends of $29.4 million,
•payments for the repurchase of common stock of $28.3 million,
•cash outflows of $4.8 million related to the vesting of stock-based awards, net of shares tendered for payment of taxes, and
•payments of debt issuance costs of $3.1 million.
The Credit Agreement includes both financial and non-financial covenants. The covenants dictate we shall not permit our net leverage ratio to exceed certain limits, shall maintain a minimum debt service coverage ratio, and must meet certain other financial requirements. At March 31, 2026, we were in compliance with all financial covenants.
We have paid regular quarterly dividends since 2016. Future dividend policy with respect to our common stock will be determined by our Board of Directors in light of our prevailing financial needs, earnings, and other relevant factors, including any limitations in our debt agreements, such as maintenance of certain financial ratios.
In May 2022, our Board of Directors authorized a stock repurchase program (the "2022 Share Repurchase Program") for the purchase of up to $200.0 million of our common stock over a three-year period, which ended on May 19, 2025. Under this stock repurchase program, we purchased 308,898 shares at a weighted average price of $91.47 per share during the three months ended March 31, 2025, using approximately $28.3 million of the net proceeds from the offering of the 2030 Convertible Notes. Following such repurchase, no additional shares were purchased under the 2022 Share Repurchase Program prior to its expiration on May 19, 2025.
In May 2025, our Board of Directors authorized a new stock repurchase program (the "2025 Share Repurchase Program") for the purchase of up to $300.0 million of our common stock over a three-year period ending on May 15, 2028. No shares were repurchased during the three months ended March 31, 2026. As of March 31, 2026, there was $200.0 million remaining for the repurchase of shares under the 2025 Share Repurchase Program.
CORPORATE GOVERNANCE
We are in compliance with the corporate governance requirements of the Securities and Exchange Commission (the “SEC”) and the New York Stock Exchange. Our governance documents, committee charters, and key practices have been posted to the “Investors” section of our website (www.lci1.com) and are updated periodically. The website also contains, or provides direct links to, all SEC filings, press releases and investor presentations. We have also established a Whistleblower Policy, which includes a toll-free hotline (800-461-9330) to report complaints about our accounting, internal controls, auditing matters or other concerns. The Whistleblower Policy and procedure for complaints can be found on our website (www.lci1.com).
CONTINGENCIES
Information required by this item is included in Note 10 of the Notes to Condensed Consolidated Financial Statements and is incorporated herein by reference.
RAW MATERIALS INFLATION
The prices of key raw materials, consisting primarily of steel and aluminum, and components used by us which are made from these raw materials, are influenced by demand and other factors specific to these commodities, including tariffs for
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ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
materials sourced internationally. The prices for steel and aluminum consumed in certain of our manufactured components were higher during the first three months of 2026 compared to the same period of 2025. Prices of these commodities have historically been volatile and there can be no assurances of future prices. Please see "Results of Operations" above for additional information regarding the impact of raw material costs, including related to tariffs, on our results of operations for the first three months of 2026.
NEW ACCOUNTING PRONOUNCEMENTS
Information required by this item is included in Note 2 of the Notes to Condensed Consolidated Financial Statements.
CRITICAL ACCOUNTING ESTIMATES
Our Condensed Consolidated Financial Statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which requires certain estimates and assumptions to be made that affect amounts and disclosures reported in those financial statements and the related accompanying notes. Actual results could differ from these estimates and assumptions.
For a discussion of our critical accounting estimates, refer to Management's Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2025. There have been no material changes to our critical accounting estimates as described in that Annual Report.
FORWARD-LOOKING STATEMENTS
This Form 10-Q contains certain "forward-looking statements" with respect to our financial condition, results of operations, profitability, margins, business strategies, operating efficiencies or synergies, competitive position, growth opportunities, acquisitions, plans and objectives of management, markets for the Company's common stock, the impact of legal proceedings, and other matters. Statements in this Form 10-Q that are not historical facts are "forward-looking statements" for the purpose of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and Section 27A of the Securities Act of 1933, as amended, and involve a number of risks and uncertainties.
Forward-looking statements, including, without limitation, those relating to the Company's production levels, future business prospects, net sales, expenses and income (loss), capital expenditures, tax rate, cash flow, financial condition, liquidity, covenant compliance, retail and wholesale demand, integration of acquisitions, R&D investments, commodity prices, addressable markets, and industry trends, whenever they occur in this Form 10-Q, are necessarily estimates reflecting the best judgment of the Company's senior management at the time such statements were made. There are a number of factors, many of which are beyond the Company’s control, which could cause actual results and events to differ materially from those described in the forward-looking statements. These factors include, in addition to other matters described in this Form 10-Q, the impacts of costs and availability of, and tariffs on, raw materials (particularly steel and aluminum) and other components, future pandemics, geopolitical tensions, armed conflicts, or natural disasters on the global economy and on the Company's customers, suppliers, team members, business and cash flows, pricing pressures due to domestic and foreign competition, seasonality and cyclicality in the industries to which we sell our products, availability of credit for financing the retail and wholesale purchase of products for which we sell our components, inventory levels of retail dealers and manufacturers, availability of transportation for products for which we sell our components, the financial condition of our customers, the financial condition of retail dealers of products for which we sell our components, retention and concentration of significant customers, the costs, pace of, and successful integration of acquisitions and other growth initiatives, availability and costs of production facilities and labor, team member benefits, team member retention, realization and impact of expansion plans, efficiency improvements and cost reductions, the disruption of business resulting from natural disasters or other unforeseen events, the successful entry into new markets, the costs of compliance with environmental laws, laws of foreign jurisdictions in which we operate, other operational and financial risks related to conducting business internationally, and increased governmental regulation and oversight, information technology performance and security, the ability to protect intellectual property, warranty and product liability claims or product recalls, interest rates, oil and gasoline prices, and availability, the impact of international, national and regional economic conditions and consumer confidence on the retail sale of products for which we sell our components, and other risks and uncertainties discussed more fully under the caption "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2025, and in the Company's subsequent filings with the SEC, including the Company's Quarterly Reports on Form 10-Q. Readers of this report are cautioned not to place undue reliance on these forward-looking statements, since there can be no assurance that these forward-looking statements will prove to be accurate. The Company disclaims any obligation or undertaking to update forward-looking statements to reflect circumstances or events that occur after
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ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
the date the forward-looking statements are made, except as required by law.
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LCI INDUSTRIES
ITEM 3 – QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK
We are exposed to market risk related to changes in short-term interest rates on our variable rate debt. Depending on the interest rate option selected as further described in Note 8 of the Notes to Condensed Consolidated Financial Statements, interest is charged based on an indexed rate plus an applicable margin. Assuming a hypothetical increase of 0.25 percent in the indexed interest rate (which approximates a six percent increase of the weighted-average interest rate on our borrowings as of March 31, 2026), our results of operations would not be materially affected.
We are also exposed to changes in the prices of raw materials, specifically steel and aluminum. We have, from time to time, entered into derivative instruments for the purpose of managing a portion of the exposures associated with fluctuations in steel and aluminum prices. While these derivative instruments are subject to fluctuations in value, these fluctuations are generally offset by the changes in fair value of the underlying exposures. We had no outstanding derivative instruments on commodities at March 31, 2026 and December 31, 2025.
We have historically been able to obtain sales price increases to partially offset the majority of raw material cost increases. However, there can be no assurance future cost increases, if any, can be partially or fully passed on to customers, or that the timing of such sales price increases will match raw material cost increases. Our tariff mitigation strategy of diversifying our supply chain, with help from our vendors and other sourcing strategies, enabled us to minimize the impact of pricing to our customers as well as support profitability in the first quarter of 2026.
Additional information required by this item is included under the caption "Raw Materials Inflation" in the Management's Discussion and Analysis of Financial Condition and Results of Operations section of this report.
ITEM 4 – CONTROLS AND PROCEDURES
a.Evaluation of Disclosure Controls and Procedures
We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and (ii) accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure, in accordance with the definition of "disclosure controls and procedures" in Rule 13a-15(e) under the Exchange Act. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, cannot provide absolute assurance of achieving the desired control objectives. Management included in its evaluation the cost-benefit relationship of possible controls and procedures. We continually evaluate our disclosure controls and procedures to determine if changes are appropriate based upon changes in our operations or the business environment in which we operate.
As of the end of the period covered by this Form 10-Q, we performed an evaluation, under the supervision and with the participation of our management, including our principal executive officer and our principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective as of March 31, 2026.
b.Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting during the quarter ended March 31, 2026, which have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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LCI INDUSTRIES
PART II – OTHER INFORMATION
ITEM 1 – LEGAL PROCEEDINGS
In the normal course of business, we are subject to proceedings, lawsuits, regulatory agency inquiries, and other claims. All such matters are subject to uncertainties and outcomes that are not predictable with assurance. While these matters could materially affect operating results when resolved in future periods, management believes that, after final disposition, including anticipated insurance recoveries in certain cases, any monetary liability or financial impact to the Company beyond that provided for in the Condensed Consolidated Balance Sheet as of March 31, 2026, would not be material to our financial position or results of operations.
ITEM 1A – RISK FACTORS
There have been no material changes to the matters discussed in Part I, Item 1A – Risk Factors in our Annual Report on Form 10-K as filed with the SEC on February 26, 2026.
ITEM 2 – UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
None.
ITEM 5 - OTHER INFORMATION
On February 27, 2026 , Jason Lippert , our Chief Executive Officer and a member of our board of directors , entered into a 10b5-1 trading arrangement February 15, 2027 or the date all shares are sold thereunder. An aggregate of up to 50,000 shares may be sold pursuant to the trading arrangement.
On February 27, 2026 , Jamie Schnur , our Group President of Aftermarket and Technology , entered into a 10b5-1 trading arrangement intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) promulgated under the Exchange Act. The trading arrangement will terminate on the earlier of February 15, 2027 or the date all shares are sold thereunder. An aggregate of up to 12,500 shares may be sold pursuant to the trading arrangement.
ITEM 6 – EXHIBITS
a) Exhibits as required by Item 601 of Regulation S-K:
| 1 | 3.1 | Amended and Restated Certificate of Incorporation of LCI Industries, conformed version that includes all amendments through May 16, 2024 (incorporated by reference to Exhibit 3.3 included in the Registrant's Form 10-Q filed on August 6, 2024). | ||||||
| 2 | 3.2 | Amended and Restated Bylaws of LCI Industries, effective March 9, 2023 (incorporated by reference to Exhibit 3.2 included in the Registrant's Form 10-Q filed on May 9, 2023). | ||||||
| 4 | 31.1 | Certification of Chief Executive Officer required by Rule 13a-14(a). | ||||||
| 5 | 31.2 | Certification of Chief Financial Officer required by Rule 13a-14(a). | ||||||
| 6 | 32.1 | Certification of Chief Executive Officer required by Rule 13a-14(b) and Section 1350 Chapter 63 of Title 18 of the United States Code. | ||||||
| 7 | 32.2 | Certification of Chief Financial Officer required by Rule 13a-14(b) and Section 1350 Chapter 63 of Title 18 of the United States Code. | ||||||
| 8 | 101 | The following information from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2026, formatted in Inline XBRL: (i) Condensed Consolidated Statements of Income; (ii) Condensed Consolidated Statements of Comprehensive Income; (iii) Condensed Consolidated Balance Sheets; (iv) Condensed Consolidated Statements of Cash Flows; (v) Condensed Consolidated Statements of Stockholders’ Equity; (vi) Notes to Condensed Consolidated Financial Statements; and (vii) information in Part II, Item 5. | ||||||
| 9 | 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). | ||||||
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LCI INDUSTRIES
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| LCI INDUSTRIES | |||||
| Registrant | |||||
| By | /s/ Lillian D. Etzkorn | ||||
| Lillian D. Etzkorn | |||||
| Chief Financial Officer | |||||
| May 5, 2026 | |||||
36
FAQ
How did LCI Industries (LCII) perform financially in Q1 2026?
LCI Industries grew net sales to $1.09 billion from $1.05 billion and increased net income to $62.9 million from $49.4 million. Diluted EPS rose to $2.53, reflecting better margins from pricing, sourcing gains, and cost improvements.
What drove LCI Industries’ revenue growth in Q1 2026?
Revenue growth was driven by price increases to offset higher material costs, $46.8 million of sales from acquisitions, and higher sales in adjacent OEM and aftermarket markets. These factors outweighed lower North American travel trailer and fifth-wheel RV shipments.
How did LCI Industries’ OEM and Aftermarket segments perform in Q1 2026?
OEM Segment net sales rose 4% to $852.8 million, with strength in adjacent industries and motorhomes. Aftermarket Segment net sales increased 7% to $237.7 million, helped by pricing and acquisitions, despite softer automotive and marine aftermarket volumes.
What was LCI Industries’ cash flow and liquidity position in Q1 2026?
Operating activities used $33.5 million of cash, mainly from higher receivables and inventory ahead of the selling season. The company held $142.2 million in cash and had $595.2 million available under its revolving credit facility at quarter-end.
How much debt does LCI Industries have outstanding?
LCI Industries reported total long-term debt of about $945.0 million, including $460.0 million of 2030 convertible notes, $92.0 million of 2026 convertible notes, and $396.0 million under its term loan, net of deferred financing fees as of March 31, 2026.
What dividend did LCI Industries pay in Q1 2026?
LCI Industries paid a regular quarterly dividend of $1.15 per share in Q1 2026, totaling $27.9 million. This continues its recent dividend level and reflects ongoing cash returns to shareholders alongside capital investments and debt service.
How exposed is LCI Industries to RV market conditions in 2026?
About 78% of Q1 2026 net sales came from the OEM Segment, with roughly 52% of OEM sales tied to travel trailer and fifth-wheel RVs. However, growth in adjacent transportation, marine, housing markets and the Aftermarket Segment provides additional diversification.