Polaris Inc.

Consolidated Results of Operations

The consolidated results of operations were as follows:

Sales:

The increase in sales for the quarter and year-to-date period was primarily driven by increased shipments and higher net pricing, partially offset by reduced motorcycle shipments as a result of the Indian Motorcycle divestiture and product mix.

The components of the consolidated sales change were as follows:

Sales by geographic region were as follows:

Sales in the United States increased during the quarter and year-to-date periods primarily as a result of increased ORV, Commercial, snowmobile, Government/Defense, and pontoon shipments, as well as higher PG&A sales. These increases were partially offset by reduced motorcycle shipments as a result of the Indian Motorcycle divestiture.

Sales in Canada increased during the quarter and year-to-date periods primarily as a result of increased snowmobile shipments and PG&A sales, partially offset by reduced motorcycle shipments as a result of the Indian Motorcycle divestiture. Currency rate movements had an unfavorable impact of three percentage points on quarter sales and a favorable impact of one percentage point on year-to-date sales.

Sales in other countries decreased during the quarter and year-to-date periods primarily due to reduced motorcycle shipments as a result of the Indian Motorcycle divestiture and fewer Aixam shipments. These decreases were partially offset by increased ORV shipments. Currency rate movements had a favorable impact of one percentage point on quarter sales and five percentage points on year-to-date sales.

Cost of Sales:

The following table reflects our cost of sales in dollars and as a percentage of sales:

Cost of sales increased during the quarter and year-to-date period primarily due to increased sales volumes driving higher purchased materials and increased labor costs, as well as increased warranty expense. These increases were partially offset by reduced depreciation and amortization expense.

Gross Profit:

Gross profit for the quarter and year-to-date period, as a percentage of sales, increased primarily as a result of higher net pricing, favorable operational costs and tariff refunds, partially offset by higher commodity costs and incremental tariff expense. The increase in gross profit for the year-to-date period, as a percentage of sales, was also driven by favorable product mix.

Operating Expenses:

Operating expenses, in absolute dollars and as a percentage of sales, decreased for the quarter primarily as a result of impairment charges in the prior year comparable period that did not recur in 2026 and lower research and development and selling and marketing expenses, partially offset by higher general and administrative expenses. For the year-to-date period, operating expenses increased in absolute dollars and decreased as a percentage of sales. These changes were primarily due to higher general and administrative expenses, partially offset by goodwill impairment charges in the prior year that did not recur in 2026, lower selling and marketing expenses, and reduced impairment and other charges associated with assets sold or classified as held for sale.

Income from Financial Services:

Income from financial services decreased for the quarter and year-to-date period, primarily due to lower retail credit income as a result of reduced penetration and lower wholesale financing income from Polaris Acceptance.

Interest Expense:

Interest expense decreased for the quarter and year to date period, primarily as a result of lower average debt levels.

Other (income) expense, net:

The increase in other (income) expense for the quarter and year-to-date period was primarily attributable to incremental income received under transition services agreements following the Indian Motorcycle divestiture. The increase for the year-to-date period was also driven by an impairment charge related to a strategic investment recorded in the prior year comparable period that did not recur in 2026. Other (income) expense is also impacted by currency exchange rate movements and the corresponding effects on currency transactions related to our international subsidiaries.

Provision (benefit) for income taxes:

Income tax expense for the quarter was $17.6 million or 31.3 percent of income before income taxes, compared to income tax expense of $3.6 million or 28.6 percent of the loss before income taxes for the third quarter of 2025. Income tax expense for the year-to-date period was $33.9 million or 25.7 percent of income before income taxes, compared to an income tax benefit of $14.3 million or 8.2 percent of the loss before income taxes for the nine months ended September 30, 2025. The change in the effective income tax rate for the quarter and year-to-date periods was primarily due to pretax income generated in the 2026 periods compared to pretax losses in the prior year periods, as well as impacts associated with changes in non-deductible impairment charges, Foreign-Derived Deduction Eligible Income, research and development credits, and income tax reserves compared to the prior periods.

Adjusted EBITDA:

Adjusted EBITDA, in absolute dollars and as a percentage of sales, increased during the quarter and year-to-date period primarily as a result of increased shipments, higher net pricing, favorable operating costs and tariff refunds, partially offset by incremental tariff expense, higher commodity costs and increased general and administrative expense.

Weighted average diluted shares outstanding:

Weighted average diluted shares outstanding increased for the quarter and year-to-date period, primarily due to share issuances within and between the comparable periods and an increase in the dilutive effect of share-based equity awards.

Cash Dividends:

We paid a regular cash dividend of $0.68 per common share on September 15, 2026 to holders of record at the close of business on September 1, 2026. We paid aggregate cash dividends of $2.04 per common share for the nine months ended September 30, 2026.

Segment Results of Operations

In the first quarter of 2026, the Company began management of its portfolio of businesses under a new basis following the divestiture of the Indian Motorcycle business. All historical results were reclassified for comparability, including the results of the divested Indian Motorcycle business, which are included in corporate and corporate costs and other.

The summary that follows provides a discussion of the results of operations of each of our three reportable segments, Polaris Powersports, Marine, and Aixam & Goupil. Each of these reportable segments is comprised of various product offerings that serve multiple end markets. We evaluate performance based on sales and gross profit. Corporate and corporate costs and other includes revenues and costs of previously divested businesses including Indian Motorcycle, income and costs related to TSA and supply agreements, and costs that are not allocated to reportable segments, including certain manufacturing costs, the impacts of certain foreign currency transactions, and certain incentive compensation costs and related adjustments.

Our sales and gross profit by reportable segment, which includes the respective PG&A, as well as amounts related to corporate and other activities, were as follows:

Polaris Powersports:

Polaris Powersports sales, inclusive of PG&A sales, increased for the quarter and year-to-date period, primarily as a result of increased ORV, Commercial, snowmobile, and Government/Defense shipments, as well as higher PG&A sales. The average per unit sales price for the Polaris Powersports reportable segment was approximately flat for the quarter and increased approximately two percent for the year-to-date period primarily as a result of product mix and higher net pricing.

Sales to customers outside of North America increased 10 percent for the quarter and 15 percent for the year-to-date period primarily as a result of higher ORV shipments.

Gross profit, as a percentage of sales, increased during the quarter and year-to-date period primarily as a result of higher net pricing, favorable operating costs and tariff refunds, partially offset by incremental tariff expense and higher commodity costs. The increase in gross profit for the year-to-date period, as a percentage of sales, was also driven by favorable product mix.

Additional information on our end markets for the quarter:

•Polaris North America utility unit retail sales up mid-single digits percent

•Polaris North America recreation excluding youth unit retail sales down mid-teens percent

•Total Polaris North America ORV excluding youth unit retail sales up low-single digits percent

•Estimated North America industry ORV excluding youth unit retail sales approximately flat

•Total Polaris North America ORV excluding youth dealer inventories up approximately 12 percent

Marine:

Marine sales increased during the quarter and year-to-date period primarily as a result of favorable product mix and increased pontoon shipments. The average per unit sales price for the Marine reportable segment increased approximately 15 percent and 11 percent for the quarter and year-to-date period, respectively, primarily due to product mix and higher net pricing.

Gross profit, as a percentage of sales, increased for the quarter and year-to-date period primarily as a result of favorable product mix and favorable operating costs, partially offset by incremental tariff expense.

Additional information on our end markets for the two-month period ended August 31, 2026:

•Polaris U.S. pontoon unit retail sales down low-double digits percent

•Estimated U.S. industry pontoon unit retail sales down low-teens percent

•Polaris U.S. deck boat unit retail sales down low-forties percent

•Estimated U.S. industry deck boat unit retail sales down mid-thirties percent

Aixam & Goupil

Aixam & Goupil sales, inclusive of PG&A sales, decreased for the quarter primarily due to reduced Aixam shipments. Sales increased for the year-to-date period primarily as a result of increased Goupil shipments and PG&A sales, mostly offset by reduced Aixam shipments.

Gross profit, as a percentage of sales, decreased during the quarter primarily due to decreased leverage of fixed costs as a result of reduced sales volumes and unfavorable product mix. Gross profit, as a percentage of sales, increased during the year-to-date period primarily as a result of favorable operational costs and lower warranty expense.

Corporate

Corporate includes revenues and costs of previously divested businesses including Indian Motorcycle, income and costs related to transition services and supply agreements, and costs that are not allocated to reportable segments, including certain manufacturing costs, the impacts of certain foreign currency transactions, and certain incentive compensation costs and related adjustments. Corporate sales and gross profit decreased for the quarter and year-to-date periods as a result of the Indian Motorcycle divestiture on February 2, 2026. These decreases were partially offset by incremental sales and gross profit generated from transition services and supply agreements.

Non-GAAP Financial Measures

To supplement our consolidated financial statements, which are prepared and presented in accordance with U.S. GAAP, we use certain non-GAAP financial measures, as described below, to understand and evaluate our core operating performance. These non-GAAP financial measures, which may be different than similarly titled measures used by other companies, are presented to enhance investors’ overall understanding of our financial performance and should not be considered a substitute for, or superior to, the financial information prepared and presented in accordance with U.S. GAAP.

We use the non-GAAP financial measure of Adjusted EBITDA, which is defined as net income (loss), excluding interest expense, income tax expense, depreciation and amortization, and certain other non-cash, non-recurring, or non-operating items impacting net income (loss) from time to time. For example, costs associated with certain corporate restructuring activities, such as acquisitions and divestitures, are included as non-GAAP adjustments. We use the non-GAAP financial measure of Adjusted EBITDA Margin, which is defined as Adjusted EBITDA divided by adjusted net sales. We believe that Adjusted EBITDA and Adjusted EBITDA Margin help identify underlying trends in our business that could otherwise be masked by the effect of the expenses that we exclude from Adjusted EBITDA and Adjusted EBITDA Margin.

We believe that these measures provide useful information about our financial performance, enhance the overall understanding of our past performance and future prospects, and allow for greater transparency with respect to key metrics used by our management for financial and operational decision making. We are presenting these non-GAAP measures to assist investors in seeing our financial performance through the eyes of management, and because we believe that these measures provide an additional tool for investors to use in comparing our core financial performance over multiple periods with other companies in our industry.

Adjusted EBITDA has limitations and should not be considered in isolation from, as a substitute for, or more meaningful than, net income (loss) as determined in accordance with U.S. GAAP. Certain items excluded from Adjusted EBITDA are significant components in understanding and assessing a company’s financial performance. 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.

The following table presents a reconciliation of net income (loss), the most comparable U.S. GAAP financial measure, to Adjusted EBITDA for each of the periods presented:

(1)Represents amortization expense for intangible assets acquired through business combinations and asset acquisitions

(2)Represents adjustments for integration and acquisition-related expenses

(3) Represents adjustments for corporate restructuring

(4)Represents adjustments related to product wind downs

(5) Represents adjustments for pending class action lawsuit settlements and the related litigation costs, as well as certain legal costs associated with the Company’s active federal patent infringement matter

(6) Represents goodwill and strategic investment impairment charges

(7) Represents charges attributable to payments made in support of a distressed supplier

(8) Represents the loss associated with the Company’s divestiture of the Indian Motorcycle business, as well as impairment and other charges related to certain other assets sold or classified as held for sale