HARLEY-DAVIDSON, INC.

5. Additional Balance Sheet and Cash Flow Information

Investments in marketable securities consisted of the following at December 31 (in thousands):

Mutual funds, included in Other long-term assets on the Consolidated balance sheets, are carried at fair value with gains and losses recorded in income. Mutual funds are held to support certain deferred compensation obligations.

Inventories, net consisted of the following as of December 31 (in thousands):

Inventory obsolescence reserves deducted from FIFO cost were $69.8 million and $84.6 million as of December 31, 2025 and 2024, respectively.

Property, plant and equipment, net consisted of the following as of December 31 (in thousands):

Software, net of accumulated amortization, included in Property, plant and equipment, net, was $49.6 million and $57.8 million as of December 31, 2025 and 2024, respectively.

Accrued liabilities consisted of the following as of December 31 (in thousands):

Deposits– HDFS offers brokered certificates of deposit to customers indirectly through contractual arrangements with third-party banks and/or securities brokerage firms through its bank subsidiary. The Company had $536.6 million and $550.6 million, net of fees, of interest-bearing brokered certificates of deposit outstanding as of December 31, 2025 and December 31, 2024, respectively. The liabilities for deposits are included in Short-term deposits, net or Long-term deposits, net on the Consolidated balance sheets based upon the term of each brokered certificate of deposit issued. Each separate brokered certificate of deposit is issued under a master certificate, and as such, all outstanding brokered certificates of deposit are considered below the Federal Deposit Insurance Corporation insurance coverage limits.

Future maturities of the Company's certificates of deposit as of December 31, 2025 were as follows (in thousands):

Operating Cash Flow– The reconciliation of Net income to Net cash provided by operating activities for the years ended December 31, was as follows (in thousands):

Cash paid during the years ended December 31, for interest and income taxes was as follows (in thousands):

Operating cash flows related to finance receivables held for sale - In the third quarter of 2025, HDFS entered into the HDFS Transaction which included the sale of finance receivables as discussed in Note 6 of the Notes to Consolidated financial statements. Included in this sale were receivables that HDFS repurchased in October 2025 from a VIE that had been deconsolidated in conjunction with the sale of securitization beneficial interests discussed below. The cash outflow related to this repurchase, which was equal to the outstanding principal and interest, is reflected within the Originations and purchases of finance receivables held for sale in the Consolidated statement of cash flows. The proceeds from the subsequent sale, along with the remainder of the proceeds from the sale of finance receivables that were originated with the intent to sell and subsequently sold as part of the HDFS Transaction, are included in Proceeds from sale of finance receivables held for sale on the Consolidated statement of cash flows. Refer to Notes 6, 11, and 12 of the Notes to Consolidated financial statements for additional information about the HDFS Transaction.

Gain on sale of securitization beneficial interests –As discussed in Note 11 of the Notes to Consolidated financial statements, the Company consolidates certain SPEs, which are considered VIEs under U.S. GAAP and which hold certain assets and liabilities, including finance receivables, restricted cash, and debt. As part of the HDFS Transaction, the Company sold 95% of its residual interests in retail finance receivables that were previously transferred to certain SPEs through on-balance sheet asset-backed securitization transactions. This sale of securitization beneficial interests resulted in the deconsolidation of assets and liabilities held by certain SPEs under U.S. GAAP. The sale of securitization beneficial interests resulted in the non-cash deconsolidation of $1.87 billion of Finance receivables held for investment, net and $1.67 billion of asset-backed securitization debt held by the VIEs that were previously consolidated. As a result of the sale of securitization beneficial interests, the Company received $234.6 million in cash consideration. On the Consolidated statements of cash flows, this amount was reduced by $109.2 million of restricted cash that was deconsolidated, resulting in a $125.4 million of net cash inflow included within Proceeds from sale of securitization beneficial interests, net within Cash flows from investing activities on the Consolidated statements of cash flows. The sale of securitization beneficial interests also resulted in a gain on the sale of $27.9 million included within Cash flows provided by operating activities. Refer to Note 6 of the Notes to Consolidated financial statements for further discussion about the HDFS Transaction.