lcii-20260331

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


☐			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

LCI INDUSTRIES

(Exact name of registrant as specified in its charter)


Delaware		13-3250533
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification Number)

3501 County Road 6 East		46514
Elkhart,	Indiana	(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
Common Stock, $.01 par value	LCII	New York Stock Exchange

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 ☐

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.

Large accelerated filer ☒ Accelerated filer ☐

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.

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

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	$	1,090,517	$	1,045,590
Cost of sales	816,852		793,841
Gross profit	273,665		251,749
Warehouse and transportation	55,882		49,855
Selling, general and administrative expenses	122,624		120,577
Operating profit	95,159		81,317
Interest expense, net	9,913		5,991
Loss on extinguishment of debt	—		8,053

Income before income taxes	85,246		67,273
Provision for income taxes	22,299		17,835
Net income	$	62,947	$	49,438

Net income per common share:
Basic	$	2.60	$	1.94
Diluted	$	2.53	$	1.94

Weighted average common shares outstanding:
Basic	24,243		25,426
Diluted	24,913		25,426

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

LCI INDUSTRIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)


	Three Months Ended March 31,
	2026		2025
(In thousands)

Net income	$	62,947	$	49,438
Other comprehensive income (loss):
Net foreign currency translation adjustment	(7,313)		10,429


Total comprehensive income	$	55,634	$	59,867

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

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	$	142,237		$	222,615

Accounts receivable, net of allowances of $8,906 and $6,828 at March 31, 2026 and December 31, 2025, respectively	376,112			243,425
Inventories, net	834,453			809,094

Prepaid expenses and other current assets	67,089			74,552
Total current assets	1,419,891			1,349,686
Fixed assets, net	419,363			428,031
Goodwill	619,548			622,183
Other intangible assets, net	386,486			402,568
Operating lease right-of-use assets	272,422			272,995

Other long-term assets	99,086			100,524
Total assets	$	3,216,796		$	3,175,987

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Current maturities of long-term indebtedness	$	3,666		$	3,683
Accounts payable, trade	211,530			202,257

Current portion of operating lease obligations	44,983			44,174
Accrued expenses and other current liabilities	227,799			223,253
Total current liabilities	487,978			473,367
Long-term indebtedness	941,339			941,502
Operating lease obligations	245,358			246,047
Deferred taxes	27,699			27,495
Other long-term liabilities	127,207			126,743
Total liabilities	1,829,581			1,815,154
Stockholders' equity
Common stock, par value $.01 per share	290			289
Paid-in capital	254,361			255,118
Retained earnings	1,314,108			1,279,657
Accumulated other comprehensive income	30,369			37,682
Stockholders' equity before treasury stock	1,599,128			1,572,746
Treasury stock, at cost	(211,913)			(211,913)
Total stockholders' equity	1,387,215			1,360,833
Total liabilities and stockholders' equity	$	3,216,796		$	3,175,987

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.


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	$	62,947	$	49,438
Adjustments to reconcile net income to cash flows (used in) provided by operating activities:
Depreciation and amortization	29,798		29,542
Stock-based compensation expense	5,300		4,933

Loss on extinguishment of debt	—		8,053

Other non-cash items	3,502		2,181
Changes in assets and liabilities, net of acquisitions of businesses:
Accounts receivable, net	(134,457)		(149,644)
Inventories, net	(27,282)		39,121
Prepaid expenses and other assets	8,093		5,800
Accounts payable, trade	11,327		30,005
Accrued expenses and other liabilities	7,313		23,289
Net cash flows (used in) provided by operating activities	(33,459)		42,718
Cash flows from investing activities:
Capital expenditures	(9,668)		(9,038)
Acquisition of businesses	—		(29,579)


Other investing activities	69		(3,423)
Net cash flows used in investing activities	(9,599)		(42,040)
Cash flows from financing activities:
Vesting of stock-based awards, net of shares tendered for payment of taxes	(6,625)		(4,813)

Repayments under revolving credit facility	—		(19,261)
Proceeds from term loan borrowings	—		391,000
Repayments under term loan and other borrowings	(998)		(280,093)
Proceeds from issuance of convertible notes	—		448,500
Repurchase of convertible notes	—		(368,920)
Purchases of convertible note hedge contracts	—		(67,574)
Proceeds from issuance of warrants concurrent with note hedge contracts	—		27,600
Partial unwind of convertible note hedge and warrants	—		1,378
Payment of debt issuance costs	—		(3,122)
Payment of dividends	(27,927)		(29,352)

Repurchases of common stock	—		(28,255)
Other financing activities	—		(217)
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 and cash equivalents at beginning of period	222,615		165,756
Cash and cash equivalents at end of period	$	142,237	$	231,243


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	$	12,977	$	7,218
Income taxes	$	(1,605)	$	94
Non-cash investing and financing activities:
Purchase of property and equipment in accrued expenses	$	272	$	993

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

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	$	288	$	257,486	$	1,208,096	$	3,232	$	(82,216)	$	1,386,886
Net income	—		—		49,438		—		—		49,438
Issuance of 82,153 shares of common stock pursuant to stock-based awards, net of shares tendered for payment of taxes	1		(4,814)		—		—		—		(4,813)
Stock-based compensation expense	—		4,933		—		—		—		4,933
Purchase of convertible note hedge contracts, net of tax	—		(51,382)		—		—		—		(51,382)
Issuance of warrants	—		27,600		—		—		—		27,600
Partial unwind of convertible note hedge and warrants	—		1,378		—		—		—		1,378
Repurchase of 308,898 shares of common stock, including excise tax	—		—		—		—		(28,404)		(28,404)
Other comprehensive income	—		—		—		10,429		—		10,429
Cash dividends ($1.15 per share)	—		—		(29,352)		—		—		(29,352)
Dividend equivalents on stock-based awards	—		655		(655)		—		—		—
Balance - March 31, 2025	$	289	$	235,856	$	1,227,527	$	13,661	$	(110,620)	$	1,366,713


(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	$	289	$	255,118	$	1,279,657	$	37,682	$	(211,913)	$	1,360,833
Net income	—		—		62,947		—		—		62,947
Issuance of 85,540 shares of common stock pursuant to stock-based awards, net of shares tendered for payment of taxes	1		(6,626)		—		—		—		(6,625)
Stock-based compensation expense	—		5,300		—		—		—		5,300




Other comprehensive loss	—		—		—		(7,313)		—		(7,313)
Cash dividends ($1.15 per share)	—		—		(27,927)		—		—		(27,927)
Dividend equivalents on stock-based awards	—		569		(569)		—		—		—
Balance - March 31, 2026	$	290	$	254,361	$	1,314,108	$	30,369	$	(211,913)	$	1,387,215

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

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.

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.

In November 2024, the FASB issued ASU 2024-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20): Induced Conversions of Convertible Debt Instruments, which clarifies the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion rather than as debt extinguishments. Effective January 1, 2026, the Company adopted ASU 2024-04 and will apply the guidance prospectively to convertible debt settlements occurring after the adoption date. The adoption of this standard did not have an impact on the Company’s financial condition or results of operations.

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	24,243	25,426
Common stock equivalents pertaining to stock-based awards	90	—
Dilutive effect of 2030 Convertible Notes	580	—
Weighted average shares outstanding for diluted earnings per share	24,913	25,426

Equity instruments excluded from diluted net earnings per share calculation as the effect would have been antidilutive	204	306

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,

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 million shares were considered antidilutive.

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	$	447,971	$	174,212	$	622,183


Foreign currency translation	(2,310)		(325)		(2,635)
Net balance – March 31, 2026	$	445,661	$	173,887	$	619,548

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.

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	$	540,604	$	265,458	$	275,146	6	to	20
Patents	85,597		53,175		32,422		3	to	20
Trade names (finite life)	108,920		37,810		71,110		3	to	20
Trade names (indefinite life)	7,432		—		7,432		Indefinite
Non-compete agreements	3,683		3,536		147		3	to	6
Other	458		229		229		2	to	12

Other intangible assets	$	746,694	$	360,208	$	386,486

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	$	553,520	$	267,043	$	286,477	6	to	20
Patents	95,119		60,163		34,956		3	to	20
Trade names (finite life)	109,327		36,040		73,287		3	to	20
Trade names (indefinite life)	7,432		—		7,432		Indefinite
Non-compete agreements	4,183		4,005		178		3	to	6
Other	458		220		238		2	to	12

Other intangible assets	$	770,039	$

SEC Form 10-Q filed by LCI Industries