MALIBU BOATS, INC.

Previous wording

Our Saltwater Fishing segment participates in the manufacturing, distribution, marketing and sale throughout the world of Pursuit boats and the Maverick Boat Group family of boats (Maverick, Cobia, Pathfinder and Hewes). Our Pursuit boats expand our product offerings into the saltwater outboard fishing market and include center console, dual console and offshore models. Our Maverick Boat Group family of boats are highly complementary to Pursuit, expanding our saltwater outboard offerings with a strong focus in length segments under 30 feet. We are among the market leaders in the fiberglass outboard fishing boat category with the brands in our Saltwater Fishing segment. Retail prices for our Saltwater Fishing boats typically range from $45,000 to $1,400,000.

Current wording

Our Saltwater Fishing segment participates in the manufacturing, distribution, marketing and sale throughout the world of Pursuit boats and the Maverick Boat Group family of boats (Maverick, Cobia, Pathfinder and Hewes). Our Pursuit boats expand our product offerings into the saltwater outboard fishing market and include center console, dual console and offshore models. Our Maverick Boat Group family of boats are highly complementary to Pursuit, expanding our saltwater outboard offerings with a strong focus in length segments under 30 feet. As of December 31, 2025, we are among the market leaders in the fiberglass outboard fishing boat category with the brands in our Saltwater Fishing segment. Retail prices for our Saltwater Fishing boats typically range from $45,000 to $1,400,000.

Previous wording

We sell our boats through a dealer network that we believe is among the strongest in the recreational powerboat industry. As of June 30, 2025, our worldwide distribution channel consisted of over 325 dealer locations globally. Our dealer base is an important part of our consumers’ experience, our marketing efforts and our brands. We devote significant time and resources to find, develop and improve the performance of our dealers and believe our dealer network gives us a distinct competitive advantage. We had one dealer that represented more than 10% of our consolidated net sales in fiscal year 2025 and the first fiscal quarter of 2026, OneWater Marine, Inc.

Current wording

We sell our boats through a dealer network that we believe is among the strongest in the recreational powerboat industry. As of June 30, 2025, our worldwide distribution channel consisted of over 325 dealer locations globally. Our dealer base is an important part of our consumers’ experience, our marketing efforts and our brands. We devote significant time and resources to find, develop and improve the performance of our dealers and believe our dealer network gives us a distinct competitive advantage. We had one dealer that represented more than 10% of our consolidated net sales in fiscal year 2025 and the first half of fiscal year 2026, OneWater Marine, Inc.

Previous wording

On a consolidated basis, we achieved first quarter fiscal 2026 net sales, gross profit, net loss and Adjusted EBITDA of $194.7 million, $27.9 million, $(0.7) million and $11.8 million, respectively, compared to $171.6 million, $28.2 million, $(5.1) million and $9.9 million, respectively, for the first quarter of fiscal 2025. For the first quarter of fiscal 2026, net sales increased 13.5%, gross profit decreased 1.0%, net loss decreased 86.2% and Adjusted EBITDA increased 19.1% as compared to the first quarter of fiscal 2025. For the definition of Adjusted EBITDA and a reconciliation to net loss, see “GAAP Reconciliation of Non-GAAP Financial Measures.”

Current wording

1 For the definition of Adjusted EBITDA and a reconciliation to net (loss) income, see “GAAP Reconciliation of Non-GAAP Financial Measures.”

Previous wording

The recreational power boat industry continues to be challenged by macro-economic factors, including inflation and high interest rates, that have increased the cost of production and taken many interest rate sensitive buyers out of the market. In recent months, additional tariffs have also been introduced or proposed, as discussed below, and we are monitoring the impact they may have on cost of production, pricing and demand. Simultaneously, less price sensitive buyers have been purchasing larger, more feature-rich boats with higher average selling prices.

Current wording

The recreational power boat industry continues to be challenged by macro-economic factors, including inflation and high interest rates, that have increased the cost of production and taken many interest rate sensitive buyers out of the market. In the past year, additional tariffs have also been introduced or proposed, as discussed below, and we are monitoring the impact they may have on cost of production, pricing and demand. Simultaneously, less price sensitive buyers have been purchasing larger, more feature-rich boats with higher average selling prices.

Previous wording

Our financial results and operations have been, and will continue to be, impacted by events outside of our control, including trade policies and tariffs, inflationary pressures, interest rates, material shortages, weather events and global economic uncertainty. The current international trade and regulatory environment is subject to significant ongoing uncertainty. Earlier this year, the U.S. presidential administration announced substantial new tariffs affecting a wide range of products and jurisdictions and has indicated an intention to continue negotiating trade policies. In response, some countries have implemented, and other countries may implement, countermeasures in response to U.S. tariffs. We estimate that 18-20% of our cost of sales are sourced from outside the United States and thus we have the potential to be materially impacted by tariffs in future periods. We are continuing to monitor the potential long-term impact of tariffs and are taking a proactive approach to mitigating material supply chain risks. We expect additional material costs to be incurred in fiscal year 2026 due to new tariff exposure of approximately 1.5% to 3% of cost of sales, assuming current tariff rates. We expect to largely offset these added costs via price increases.

Current wording

Our financial results and operations have been, and will continue to be, impacted by events outside of our control, including trade policies and tariffs, inflationary pressures, interest rates, material shortages, weather events and global economic uncertainty. The current international trade and regulatory environment is subject to significant ongoing uncertainty. Last year, the U.S. presidential administration announced substantial new tariffs affecting a wide range of products and jurisdictions and has indicated an intention to continue negotiating trade policies. In response, some countries have implemented, and other countries may implement, countermeasures in response to U.S. tariffs. We estimate that 18-20% of our cost of sales are sourced from outside the United States and thus we have the potential to be materially impacted by tariffs in future periods. We are continuing to monitor the potential long-term impact of tariffs and are taking a proactive approach to mitigating material supply chain risks. We expect additional material costs to be incurred in fiscal year 2026 due to new tariff exposure of approximately 1.5% to 3% of cost of sales, assuming current tariff rates. We expect to largely offset these added costs via price increases.

Previous wording

Other (income) expense, net consists of interest expense and other income or expense, net. Interest expense consists of interest charged under our outstanding debt and amortization of deferred financing costs on our credit facilities. Other income or expense includes adjustments to our tax receivable agreement liability and sublease income.

Current wording

Other expense (income), net consists of interest expense and other income or expense, net. Interest expense consists of interest charged under our outstanding debt and amortization of deferred financing costs on our credit facilities. Other income or expense includes adjustments to our tax receivable agreement liability and sublease income.

Previous wording

Net Loss Attributable to Non-controlling Interest

Current wording

Net (loss) income Attributable to Non-controlling Interest

Previous wording

As of September 30, 2025 and 2024, we had a 98.6% and a 98.4%, respectively, controlling economic interest and 100% voting interest in the LLC and, therefore, we consolidate the LLC's operating results for financial statement purposes. Net loss attributable to non-controlling interest represents the portion of net loss attributable to the non-controlling LLC members.

Current wording

As of each of December 31, 2025 and 2024, we had a 98.6% and a 98.4%, respectively, controlling economic interest and 100% voting interest in the LLC and, therefore, we consolidate the LLC's operating results for financial statement purposes. Net (loss) income attributable to non-controlling interest represents the portion of net (loss) income attributable to the non-controlling LLC members.

Previous wording

Net sales for the three months ended September 30, 2025 increased $23.2 million, or 13.5%, to $194.7 million as compared to the three months ended September 30, 2024. The increase in net sales was driven primarily by increased unit volumes in the Malibu segment, a favorable model mix in our Cobalt segment and inflation-driven year-over-year price increases, partially offset by decreased unit volumes in the Cobalt and Saltwater Fishing segments and an unfavorable segment mix. Unit volume for the three months ended September 30, 2025, increased 105 units, or 10.3%, to 1,129 units as compared to the three months ended September 30, 2024. Our unit volume increased due to higher wholesale shipments across the Malibu segment, partially offset by lower wholesale shipments in the Cobalt and Saltwater Fishing segments.

Current wording

Net sales for the three months ended December 31, 2025 decreased $11.7 million, or 5.8%, to $188.6 million as compared to the three months ended December 31, 2024. The decrease in net sales was driven primarily by decreased unit volumes across all segments resulting primarily from lower wholesale shipments, and driven by an unfavorable model mix in our Malibu segment and an unfavorable segment mix overall, partially offset by a favorable model mix in our Cobalt and Saltwater Fishing segments and inflation-driven year-over-year price increases. Unit volume for the three months ended December 31, 2025, decreased 116 units, or 9.5%, to 1,106 units as compared to the three months ended December 31, 2024. Our unit volume decreased primarily due to lower wholesale shipments across all segments driven by lower retail activity.

Previous wording

Net sales attributable to our Saltwater Fishing segment decreased $0.4 million, or 0.7%, to $64.3 million, for the three months ended September 30, 2025, compared to the three months ended September 30, 2024. Unit volumes attributable to our Saltwater Fishing segment decreased 12 units for the three months ended September 30, 2025 compared to the three months ended September 30, 2024, primarily due to lower wholesale shipments driven by lower retail activity during the period. The decrease in net sales was driven by a decrease in units, partially offset by inflation-driven year-over-year price increases and a favorable model mix.

Current wording

Net sales attributable to our Saltwater Fishing segment decreased $4.8 million, or 6.8%, to $65.3 million, for the three months ended December 31, 2025, compared to the three months ended December 31, 2024. Unit volumes attributable to our Saltwater Fishing segment decreased 35 units for the three months ended December 31, 2025 compared to the three months ended December 31, 2024, primarily due to lower wholesale shipments driven by lower retail activity during the period. The decrease in net sales was driven by a decrease in units, partially offset by a favorable model mix and inflation-driven year-over-year price increases.

Previous wording

Net sales attributable to our Cobalt segment increased $1.0 million, or 1.9%, to $51.8 million for the three months ended September 30, 2025, compared to the three months ended September 30, 2024. Unit volumes attributable to Cobalt decreased 37 units for the three months ended September 30, 2025 compared to the three months ended September 30, 2024, primarily due to lower wholesale shipments driven by lower retail activity during the period and our dealers' desire to hold less inventory. The increase in net sales was driven primarily by a favorable model mix and inflation-driven year-over-year price increases, partially offset by a decrease in units.

Current wording

Net sales attributable to our Cobalt segment decreased $3.4 million, or 6.0%, to $52.6 million for the three months ended December 31, 2025, compared to the three months ended December 31, 2024. Unit volumes attributable to Cobalt decreased 69 units for the three months ended December 31, 2025 compared to the three months ended December 31, 2024, primarily due to lower wholesale shipments driven by lower retail activity during the period and our dealers' desire to hold less inventory. The decrease in net sales was driven primarily by a decrease in units, partially offset by a favorable model mix and inflation-driven year-over-year price increases.

Previous wording

Overall consolidated net sales per unit increased 2.9% to $172,483 per unit for the three months ended September 30, 2025, compared to the three months ended September 30, 2024. The increase in overall consolidated net sales per unit was driven primarily by a favorable model mix in our Cobalt and Saltwater Fishing segments and inflation-driven year-over-year price increases, partially offset by an unfavorable segment mix and increased dealer incentive costs in the Malibu segment. Net sales per unit for our Malibu segment increased 0.2% to $146,184 per unit for the three months ended September 30, 2025, compared to the three months ended September 30, 2024, driven by inflation-driven year-over-year price increases, partially offset by an increase in dealer incentive costs. Net sales per unit for our Saltwater Fishing segment increased 3.5% to $223,326 per unit for the three months ended September 30, 2025 driven by a favorable model mix and inflation-driven year-over-year price increases. Net sales per unit for our Cobalt segment increased 14.3% to $170,851 per unit for the three months ended September 30, 2025, compared to the three months ended September 30, 2024, driven by a favorable model mix and inflation-driven year-over-year price increases.

Current wording

Overall consolidated net sales per unit increased 4.1% to $170,544 per unit for the three months ended December 31, 2025, compared to the three months ended December 31, 2024. The increase in overall consolidated net sales per unit was driven primarily by a favorable model mix in our Cobalt and Saltwater Fishing segments and inflation-driven year-over-year price increases, partially offset by an unfavorable model mix in our Malibu segment and an unfavorable segment mix overall. Net sales per unit for our Malibu segment decreased 2.4% to $137,686 per unit for the three months ended December 31, 2025, compared to the three months ended December 31, 2024, driven by an unfavorable model mix, partially offset by inflation-driven year-over-year price increases. Net sales per unit for our Saltwater Fishing segment increased 4.7% to $231,730 per unit for the three months ended December 31, 2025 driven by a favorable model mix and inflation-driven year-over-year price increases. Net sales per unit for our Cobalt segment increased 14.8% to $169,264 per unit for the three months ended December 31, 2025, compared to the three months ended December 31, 2024, driven by a favorable model mix and inflation-driven year-over-year price increases.

Previous wording

Gross profit for the three months ended September 30, 2025 decreased $0.3 million, or 1.0%, to $27.9 million compared to the three months ended September 30, 2024. The decrease in gross profit was driven primarily by increased cost of sales for the reasons noted above, partially offset by increased net sales. Gross margin for the three months ended September 30, 2025 decreased 210 basis points from 16.4% to 14.3% driven primarily by higher per unit labor and material costs and increased dealer incentive costs in the Malibu segment.

Current wording

Gross profit for the three months ended December 31, 2025 decreased $12.3 million, or 32.9%, to $25.1 million compared to the three months ended December 31, 2024. The decrease in gross profit was driven by lower net sales combined with increased cost of sales for the reasons noted above. Gross margin for the three months ended December 31, 2025 decreased 540 basis points from 18.7% to 13.3% driven primarily by fixed cost deleverage across all segments due to lower sales and higher per unit labor and material costs.

Previous wording

Selling and marketing expenses for the three months ended September 30, 2025 increased $1.4 million, or 29.4% to $6.3 million compared to the three months ended September 30, 2024. The increase was driven primarily by an increase in certain marketing events. As a percentage of sales, selling and marketing expenses increased 40 basis points to 3.2% for the three months ended September 30, 2025 compared to 2.8% for the three months ended September 30, 2024. General and administrative expenses for the three months ended September 30, 2025 decreased $6.5 million, or 23.8%, to $20.8 million as compared to the three months ended September 30, 2024 driven primarily by a $3.5 million legal settlement for the three months ended September 30, 2024, along with decreased legal and professional fees. As a percentage of sales, general and administrative expenses decreased 520 basis points to 10.7% for the three months ended September 30, 2025 compared to 15.9% for the three months ended September 30, 2024. Amortization expense remained flat at $1.7 million for the three months ended September 30, 2025.

Current wording

Selling and marketing expenses for the three months ended December 31, 2025 increased $0.1 million, or 1.4% to $6.1 million compared to the three months ended December 31, 2024. The increase was driven primarily by higher personnel-related expenses. As a percentage of sales, selling and marketing expenses increased 20 basis points to 3.2% for the three months ended December 31, 2025 compared to 3.0% for the three months ended December 31, 2024. General and administrative expenses for the three months ended December 31, 2025 decreased $5.7 million, or 21.5%, to $20.8 million as compared to the three months ended December 31, 2024 driven primarily by a decrease in legal fees, incentive pay and stock-based compensation expense. As a percentage of sales, general and administrative expenses decreased 230 basis points to 11.0% for the three months ended December 31, 2025 compared to 13.3% for the three months ended December 31, 2024. Amortization expense remained flat at $1.7 million for the three months ended December 31, 2025.

Previous wording

Net sales attributable to our Malibu segment increased $22.6 million, or 40.4%, to $78.6 million for the three months ended September 30, 2025, compared to the three months ended September 30, 2024. Unit volumes attributable to our Malibu segment increased 154 units for the three months ended September 30, 2025, compared to the three months ended September 30, 2024, primarily due to lower wholesale shipments during the three months ended September 30, 2024, as a result of elevated dealer inventory levels. The increase in net sales was driven by an increase in units and inflation-driven year-over-year price increases, partially offset by increased dealer incentive costs.

Current wording

Net sales attributable to our Malibu segment increased $19.2 million, or 14.7%, to $149.3 million for the six months ended December 31, 2025, compared to the six months ended December 31, 2024. Unit volumes attributable to our Malibu segment increased 142 units for the six months ended December 31, 2025, compared to the six months ended December 31, 2024, primarily due to lower wholesale shipments during the same period in fiscal year 2024, as a result of elevated dealer inventory levels. The increase in net sales was driven by an increase in units and inflation-driven year-over-year price increases, partially offset by an unfavorable model mix.

Previous wording

Cost of sales for the three months ended September 30, 2025 increased $23.4 million, or 16.3%, to $166.8 million as compared to the three months ended September 30, 2024. The increase in cost of sales was primarily driven by a 13.5% increase in net sales due to higher unit volumes and partially due to higher net per unit material and labor costs of $1.9 million, $2.2 million and $6.3 million for the Malibu, Saltwater Fishing, and Cobalt segments, respectively. The increase in per unit material and labor costs was primarily driven by increased prices due to fixed cost deleverage in the Cobalt and Saltwater Fishing segments, a model mix that corresponds to higher costs per unit in our Cobalt and Saltwater Fishing segments, and inflationary pressures.

Current wording

Cost of sales for the six months ended December 31, 2025 increased $24.1 million, or 7.9%, to $330.3 million as compared to the six months ended December 31, 2024. The increase in cost of sales was primarily driven by a 3.1% increase in net sales and higher per unit material and labor costs of $4.8 million, $5.2 million and $13.3 million for the Malibu, Saltwater Fishing, and Cobalt segments, respectively. The increase in per unit material and labor costs was primarily driven by increased prices due to fixed cost deleverage in the Cobalt and Saltwater Fishing segments, a model mix that corresponds to higher costs per unit in our Cobalt and Saltwater Fishing segments and inflationary pressures.

Previous wording

Other (income) expense, net, increased $0.8 million for the three months ended September 30, 2025 compared to the three months ended September 30, 2024, due to other income from an adjustment in our tax receivable agreement liability mainly due to decreased blended federal and state tax rates used as a result of OB3 tax reform changes, and in turn, a decrease in the future benefit we expect to pay under our tax receivable agreement with pre-IPO owners.

Current wording

Other expense (income), net for the six months ended December 31, 2025 decreased by $1.1 million, or 113.3% to other income of $0.1 million. The decrease in other expense (income) was due to other income from an adjustment in our tax receivable agreement liability mainly due to decreased blended federal and state tax rates used as a result of OB3 tax reform changes, and in turn, a decrease in the future benefit we expect to pay under our tax receivable agreement with pre-IPO owners.

Previous wording

Our provision (benefit) for income taxes for the three months ended September 30, 2025, increased $1.2 million, or 136.6%, to $0.3 million compared to the three months ended September 30, 2024. The increase primarily resulted from decreased pre-tax losses. For the three months ended September 30, 2025 and 2024, our effective tax rate was (77.9)% and 14.2%, respectively. For the three months ended September 30, 2025, our effective tax rate was reduced by the impact of the change in tax law enacted, in accordance with OB3, through the remeasurement of our deferred tax assets and U.S. state taxes. For the three months ended September 30, 2024, our effective tax rate was reduced by deferred tax impacts of pre-tax losses and U.S. state taxes.

Current wording

Our (benefit) provision for income taxes for the six months ended December 31, 2025, decreased $0.3 million, or 47.4%, to $(1.0) million compared to the six months ended December 31, 2024. The decrease primarily resulted from carryback of research tax credits. This was partially offset by the impact of the change in tax law enacted, in accordance with OB3, through the remeasurement of our deferred tax assets. For the six months ended December 31, 2025, due to pre-tax losses, the Company's effective tax rate was increased by carryback of research tax credits and the impact of U.S. state taxes. These were partially offset by shortfall expense generated by certain stock-based compensation, and the foreign rate differential of our Australian subsidiary. For the six months ended December 31, 2024, due to year-to date pre-tax losses, the Company's effective tax rate was reduced by shortfall expense generated by certain stock-based compensation and the foreign rate differential of our Australian subsidiary. This was partially offset by the impact of U.S. state taxes.

Previous wording

We define Adjusted EBITDA as net loss before interest expense, income taxes, depreciation, amortization, and non-cash, non-operating expenses or other expenses that we do not believe are indicative of our ongoing expenses, including certain professional fees, litigation settlements, non-cash compensation expense and adjustments to our tax receivable agreement liability. We define Adjusted EBITDA margin as Adjusted EBITDA divided by net sales. Adjusted EBITDA and Adjusted EBITDA margin are not measures of net loss as determined by GAAP. Management believes Adjusted EBITDA and Adjusted EBITDA margin allow investors to evaluate the Company’s operating performance and compare our results of operations from period to period on a consistent basis by excluding items that management does not believe are indicative of our core operating performance. Management uses Adjusted EBITDA to assist in highlighting trends in our operating results without regard to our financing methods, capital structure and non-recurring or non-operating expenses.

Current wording

We define Adjusted EBITDA as net (loss) income before interest expense, income taxes, depreciation, amortization, and non-cash, non-operating expenses or other expenses that we do not believe are indicative of our ongoing expenses, including certain professional fees, litigation settlements, non-cash compensation expense and adjustments to our tax receivable agreement liability. We define Adjusted EBITDA margin as Adjusted EBITDA divided by net sales. Adjusted EBITDA and Adjusted EBITDA margin are not measures of net (loss) income as determined by GAAP. Management believes Adjusted EBITDA and Adjusted EBITDA margin allow investors to evaluate the Company’s operating performance and compare our results of operations from period to period on a consistent basis by excluding items that management does not believe are indicative of our core operating performance. Management uses Adjusted EBITDA to assist in highlighting trends in our operating results without regard to our financing methods, capital structure and non-recurring or non-operating expenses.

Previous wording

We exclude the items listed above from net loss in arriving at Adjusted EBITDA because these amounts can vary substantially from company to company within our industry depending upon accounting methods and book values of assets, capital structures, the methods by which assets were acquired and other factors. Adjusted EBITDA has limitations as an analytical tool and should not be considered as an alternative to, or more meaningful than, net loss as determined in accordance with GAAP or as an indicator of our liquidity. Certain items excluded from Adjusted EBITDA are significant components in understanding and assessing a company’s financial performance, such as a company’s cost of capital and tax structure, as well as the historical costs of depreciable assets. Our presentation of Adjusted EBITDA and Adjusted EBITDA margin should not be construed as an inference that our results will be unaffected by unusual or non-recurring items. Our computations of Adjusted EBITDA and Adjusted EBITDA margin may not be comparable to other similarly titled measures of other companies.

Current wording

We exclude the items listed above from net (loss) income in arriving at Adjusted EBITDA because these amounts can vary substantially from company to company within our industry depending upon accounting methods and book values of assets, capital structures, the methods by which assets were acquired and other factors. Adjusted EBITDA has limitations as an analytical tool and should not be considered as an alternative to, or more meaningful than, net (loss) income as determined in accordance with GAAP or as an indicator of our liquidity. Certain items excluded from Adjusted EBITDA are significant components in understanding and assessing a company’s financial performance, such as a company’s cost of capital and tax structure, as well as the historical costs of depreciable assets. Our presentation of Adjusted EBITDA and Adjusted EBITDA margin should not be construed as an inference that our results will be unaffected by unusual or non-recurring items. Our computations of Adjusted EBITDA and Adjusted EBITDA margin may not be comparable to other similarly titled measures of other companies.

Previous wording

The following table sets forth a reconciliation of net loss as determined in accordance with GAAP to Adjusted EBITDA and presentation of net loss margin and Adjusted EBITDA margin for the periods indicated (dollars in thousands):

Current wording

The following table sets forth a reconciliation of net (loss) income as determined in accordance with GAAP to Adjusted EBITDA and presentation of net (loss) income margin and Adjusted EBITDA margin for the periods indicated (dollars in thousands):

Previous wording

Adjusted net income per share is a non-GAAP financial measure that is used and disclosed by management in order to give management and its investors and analysts a more accurate picture of our underlying earnings performance. Adjusted net income per share, excludes items that management does not believe are indicative of our core operating performance.

Current wording

Adjusted net (loss) income per share is a non-GAAP financial measure that is used and disclosed by management in order to give management and its investors and analysts a more accurate picture of our underlying earnings performance. Adjusted net (loss) income per share, excludes items that management does not believe are indicative of our core operating performance.

Previous wording

We define adjusted net income per share as net loss attributable to Malibu Boats, Inc. per share, excluding income tax expense (benefit), before non-cash, non-operating expenses, or other expenses that we do not believe are indicative of our ongoing expenses, including litigation settlements, acquisition related amortization, certain professional fees and non-cash compensation expense, and reflecting an adjustment for income tax expense on adjusted income before income taxes at our estimated effective income tax rate.

Current wording

We define adjusted net (loss) income per share as net (loss) income attributable to Malibu Boats, Inc. per share, excluding income tax (benefit) expense, before non-cash, non-operating expenses, or other expenses that we do not believe are indicative of our ongoing expenses, including litigation settlements, acquisition related amortization, certain professional fees and non-cash compensation expense, and reflecting an adjustment for income tax expense on adjusted (loss) income before income taxes at our estimated effective income tax rate.

Previous wording

We exclude the items listed above from net loss per share in arriving at adjusted net income per share because these amounts can vary substantially from company to company within our industry depending upon accounting methods and book values of assets, the methods by which assets were acquired and other factors. Adjusted net income per share has limitations as an analytical tool and should not be considered as an alternative to, or more meaningful than, net loss per share as determined in accordance with GAAP or as an indicator of our liquidity. Certain items excluded are significant components in understanding and assessing a company’s financial performance. Our presentation of adjusted net income per share should not be construed as an inference that our results will be unaffected by unusual or non-recurring items. Our computation of this measure may not be comparable to other similarly titled measures of other companies.

Current wording

We exclude the items listed above from net (loss) income per share in arriving at adjusted net (loss) income per share because these amounts can vary substantially from company to company within our industry depending upon accounting methods and book values of assets, the methods by which assets were acquired and other factors. Adjusted net (loss) income per share has limitations as an analytical tool and should not be considered as an alternative to, or more meaningful than, net (loss) income per share as determined in accordance with GAAP or as an indicator of our liquidity. Certain items excluded are significant components in understanding and assessing a company’s financial performance. Our presentation of adjusted net (loss) income per share should not be construed as an inference that our results will be unaffected by unusual or non-recurring items. Our computation of this measure may not be comparable to other similarly titled measures of other companies.

Previous wording

The following table sets forth a reconciliation of net loss per share attributable to Malibu Boats, Inc. as determined in accordance with GAAP to adjusted net income per share for the periods indicated (dollars in thousands):

Current wording

The following table sets forth a reconciliation of net (loss) income per share attributable to Malibu Boats, Inc. as determined in accordance with GAAP to adjusted net (loss) income per share for the periods indicated (dollars in thousands):

Previous wording

During fiscal year 2025, we incurred approximately $27.9 million in capital expenditures primarily for investments in new models, capacity enhancements and vertical integration initiatives. For the three months ended September 30, 2025, we have incurred approximately $4.3 million in capital expenditures primarily for investments in new models, capacity enhancements and vertical integration initiatives.

Current wording

During fiscal year 2025, we incurred approximately $27.9 million in capital expenditures primarily for investments in new models, capacity enhancements and vertical integration initiatives. For the six months ended December 31, 2025, we have incurred approximately $8.7 million in capital expenditures primarily for investments in new models, capacity enhancements and vertical integration initiatives.

Previous wording

Our Third Amended and Restated Credit Agreement (the “Credit Agreement”) provides us with a revolving credit facility in an aggregate principal amount of up to $350.0 million. As of September 30, 2025, we had $23.0 million outstanding under our revolving credit facility and $1.7 million in outstanding letters of credit, with $325.3 million available for borrowing. The revolving credit facility matures on July 8, 2027. Assuming no additional repayments or borrowings on our revolving credit facility after September 30, 2025, our interest payments would be approximately $1.5 million within the next 12 months based on the weighted average interest rate at September 30, 2025 of 6.61%. See below under “Revolving Credit Facility” for additional information regarding our revolving credit facility, including the interest rate applicable to any borrowing under such facility.

Current wording

Our Third Amended and Restated Credit Agreement (the “Credit Agreement”) provides us with a revolving credit facility in an aggregate principal amount of up to $350.0 million. As of December 31, 2025, we had $20.0 million outstanding under our revolving credit facility and $1.8 million in outstanding letters of credit, with $328.2 million available for borrowing. The revolving credit facility matures on July 8, 2027. Assuming no additional repayments or borrowings on our revolving credit facility after December 31, 2025, our expected cash interest payments, including accrued interest outstanding at December 31, 2025, would be approximately $1.2 million within the next 12 months based on the weighted average interest rate at December 31, 2025 of 5.25%. See below under “Revolving Credit Facility” for additional information regarding our revolving credit facility, including the interest rate applicable to any borrowing under such facility.

Previous wording

We entered into a tax receivable agreement with our pre-IPO owners at the time of our initial public offering. Under the tax receivables agreement, we pay the pre-IPO owners (or any permitted assignees) 85% of the amount of cash savings, if any, in U.S. federal, state and local income tax or franchise tax that we actually realize, or in some circumstances are deemed to realize, as a result of an expected increase in our share of tax basis in LLC’s tangible and intangible assets, including increases attributable to payments made under the tax receivable agreement. These obligations will not be paid if we do not realize cash tax savings. We estimate that approximately $0.3 million will be due under the tax receivable agreement within the next 12 months. In accordance with the tax receivable agreement, the next payment is anticipated to occur once net operating losses are utilized and there is sufficient taxable income.

Current wording

We entered into a tax receivable agreement with our pre-IPO owners at the time of our initial public offering. Under the tax receivables agreement, we pay the pre-IPO owners (or any permitted assignees) 85% of the amount of cash savings, if any, in U.S. federal, state and local income tax or franchise tax that we actually realize, or in some circumstances are deemed to realize, as a result of an expected increase in our share of tax basis in LLC’s tangible and intangible assets, including increases attributable to payments made under the tax receivable agreement. These obligations will not be paid if we do not realize cash tax savings. We estimate that approximately $0.3 million will be due under the tax receivable agreement within the next 12 months. In accordance with the tax receivable agreement, the next annual payment is anticipated approximately 75 days after filing the federal return due by April 15, 2026.

Previous wording

Lease commitments consist principally of leases for our manufacturing facilities. Our expected operating lease payments due within the next 12 months are $2.7 million and our total committed lease payments are $7.2 million as of September 30, 2025. Additional information regarding our operating leases is available in Note 11 of our unaudited interim condensed consolidated financial statements included elsewhere in this Quarterly Report.

Current wording

Lease commitments consist principally of leases for our manufacturing facilities. Our expected operating lease payments due within the next 12 months are $2.7 million and our total committed lease payments are $6.6 million as of December 31, 2025. Additional information regarding our operating leases is available in Note 11 of our unaudited interim condensed consolidated financial statements included elsewhere in this Quarterly Report.

Previous wording

In the ordinary course of business, we enter into purchase orders from a variety of suppliers, primarily for raw materials, in order to manage our various operating needs. The orders are expected to be purchased throughout fiscal year 2026. We or the vendor can generally terminate the purchase orders at any time. These purchase orders do not contain any termination payments or other penalties if cancelled. As of September 30, 2025, we had purchase orders in the amount of $71.9 million due within the next 12 months.

Current wording

In the ordinary course of business, we enter into purchase orders from a variety of suppliers, primarily for raw materials, in order to manage our various operating needs. The orders are expected to be purchased throughout fiscal year 2026. We or the vendor can generally terminate the purchase orders at any time. These purchase orders do not contain any termination payments or other penalties if cancelled. As of December 31, 2025, we had purchase orders in the amount of $59.2 million due within the next 12 months.

Previous wording

In June 2025, our Board of Directors authorized a stock repurchase program to allow for the repurchase of up to $50.0 million of our Class A Common Stock and the LLC’s LLC Units (the "2025 Repurchase Program") for the period from July 1, 2025 to June 30, 2026. We may purchase shares under the 2025 Repurchase Program from time to time in privately negotiated transactions or open market transactions, including under plans complying with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended at the discretion of management, subject to strategic considerations, market conditions, and other factors. During the three months ended September 30, 2025, we did not have any stock repurchases.

Current wording

In June 2025, our Board of Directors authorized a stock repurchase program to allow for the repurchase of up to $50.0 million of our Class A Common Stock and the LLC’s LLC Units (as amended, the "2025 Repurchase Program") for the period from July 1, 2025 to June 30, 2026. On December 18, 2025, our Board of Directors authorized an increase to the Company's existing 2025 Repurchase Program, raising the authorized amount from $50.0 million to $70.0 million. We may purchase shares under the 2025 Repurchase Program from time to time in privately negotiated transactions or open market transactions, including under plans complying with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended at the discretion of management, subject to strategic considerations, market conditions, and other factors. During the six months ended December 31, 2025, we repurchased 751,202 shares of Class A Common Stock for $20.8 million in cash including related fees and expenses under the 2025 Repurchase Program. As of December 31, 2025, $49.2 million was available to repurchase shares of Class A Common Stock and LLC Units under the 2025 Repurchase Program.

Previous wording

Net cash provided by operating activities was $6.5 million for the three months ended September 30, 2025, compared to net cash used in operating activities of $8.4 million for the three months ended September 30, 2024, an increase in cash of $14.9 million. The increase in cash provided by operating activities resulted from a net increase in operating assets and liabilities of $9.4 million. The increase in operating assets and liabilities was due in part to an increase of $5.5 million in net income (after consideration of non-cash items included in net loss, primarily related to depreciation, amortization, deferred tax assets and non-cash compensation).

Current wording

Net cash provided by operating activities was $19.2 million for the six months ended December 31, 2025, compared to $20.0 million for the six months ended December 31, 2024, a decrease of $0.8 million. The decrease in cash from operating activities resulted from a net decrease in operating assets and liabilities of $2.3 million, partially offset by an increase of $1.5 million in net income (after consideration of non-cash items included in net (loss) income, primarily related to depreciation, amortization, deferred tax assets and non-cash compensation).

Previous wording

Net cash used in investing activities was $4.2 million for the three months ended September 30, 2025, compared to net cash used in investing activities of $8.6 million for the three months ended September 30, 2024, a decrease in net cash used of $4.4 million. The decrease in net cash used in investing activities for the three months ended September 30, 2025 was primarily related to decreased capital expenditures compared to the three months ended September 30, 2024.

Current wording

Net cash used in investing activities was $8.6 million for the six months ended December 31, 2025, compared to net cash used in investing activities of $13.9 million for the six months ended December 31, 2024, a decrease in net cash used of $5.3 million. The decrease in net cash used in investing activities for the six months ended December 31, 2025 was primarily related to decreased capital expenditures compared to the six months ended December 31, 2024.

Previous wording

Net cash provided by financing activities was $4.6 million for the three months ended September 30, 2025 compared to net cash provided by financing activities of $17.5 million for the three months ended September 30, 2024, a decrease of $12.9 million. During the three months ended September 30, 2025, we borrowed $5.0 million, net of repayments, under our revolving credit facility and did not repurchase any of our Class A Common Stock under our current stock repurchase program. During the three months ended September 30, 2024, we borrowed $28.0 million, net of repayments, under our revolving credit facility and repurchased $10.5 million of our Class A Common Stock under our prior stock repurchase program.

Current wording

Net cash used in financing activities was $19.7 million for the six months ended December 31, 2025 compared to net cash provided by financing activities of $2.3 million for the six months ended December 31, 2024, a decrease of $21.9 million. During the six months ended December 31, 2025, we borrowed $2.0 million, net of repayments, under our revolving credit facility and repurchased $20.8 million of our Class A Common Stock under our current stock repurchase program. During the six months ended December 31, 2024, we borrowed $23.0 million, net of repayments, under our revolving credit facility and repurchased $20.2 million of our Class A Common Stock under our prior stock repurchase program.

Previous wording

On July 8, 2022, Boats LLC entered into a Third Amended and Restated Credit Agreement (the “Credit Agreement”) which provides Boats LLC with a revolving credit facility in an aggregate principal amount of up to $350.0 million. As of September 30, 2025, Boats LLC had $23.0 million outstanding under its revolving credit facility and $1.7 million in outstanding letters of credit, with $325.3 million available for borrowing. The revolving credit facility matures on July 8, 2027. Boats LLC has the option to request that lenders increase the amount available under the revolving credit facility by, or obtain term loans of, up to $200.0 million, subject to the terms of the Credit Agreement and only if existing or new lenders choose to provide additional term or revolving commitments.

Current wording

On July 8, 2022, Boats LLC entered into a Third Amended and Restated Credit Agreement (the “Credit Agreement”) which provides Boats LLC with a revolving credit facility in an aggregate principal amount of up to $350.0 million. As of December 31, 2025, Boats LLC had $20.0 million outstanding under its revolving credit facility and $1.8 million in outstanding letters of credit, with $328.2 million available for borrowing. The revolving credit facility matures on July 8, 2027. Boats LLC has the option to request that lenders increase the amount available under the revolving credit facility by, or obtain term loans of, up to $200.0 million, subject to the terms of the Credit Agreement and only if existing or new lenders choose to provide additional term or revolving commitments.

Previous wording

Our dealers have arrangements with certain finance companies to provide secured floor plan financing for the purchase of our boats. These arrangements indirectly provide liquidity to us by financing dealer purchases of our products, thereby minimizing the use of our working capital in the form of accounts receivable. A majority of our sales are financed under similar arrangements, pursuant to which we receive payment within a few days of shipment of the product. In most cases, we have agreed to repurchase products repossessed by the finance companies if a dealer defaults on its debt obligations to a finance company and the boat is returned to us, subject to certain limitations. Our financial exposure under these agreements is limited to the difference between the amounts unpaid by the dealer with respect to the repossessed product plus costs of repossession and the amount received on the resale of the repossessed product. During the three months ended September 30, 2025, we did not repurchase any boats under our repurchase agreements. For fiscal year 2025, we repurchased 22 units under our repurchase agreements, including 19 boats that were related to the bankruptcy with Tommy's Boats totaling $2.5 million. An adverse change in retail sales could require us to repurchase repossessed units upon an event of default by any of our dealers, subject to the annual limitation. Refer to Note 16 to the unaudited interim condensed consolidated financial statements included elsewhere in this Quarterly Report for further information on repurchase commitments.

Current wording

Our dealers have arrangements with certain finance companies to provide secured floor plan financing for the purchase of our boats. These arrangements indirectly provide liquidity to us by financing dealer purchases of our products, thereby minimizing the use of our working capital in the form of accounts receivable. A majority of our sales are financed under similar arrangements, pursuant to which we receive payment within a few days of shipment of the product. In most cases, we have agreed to repurchase products repossessed by the finance companies if a dealer defaults on its debt obligations to a finance company and the boat is returned to us, subject to certain limitations. Our financial exposure under these agreements is limited to the difference between the amounts unpaid by the dealer with respect to the repossessed product plus costs of repossession and the amount received on the resale of the repossessed product. During the six months ended December 31, 2025, we did not repurchase any boats under our repurchase agreements. For fiscal year 2025, we repurchased 22 units under our repurchase agreements, including 19 boats that were related to the bankruptcy with Tommy's Boats totaling $2.5 million. An adverse change in retail sales could require us to repurchase repossessed units upon an event of default by any of our dealers, subject to the annual limitation. Refer to Note 16 to the unaudited interim condensed consolidated financial statements included elsewhere in this Quarterly Report for further information on repurchase commitments.