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What changed in Dorman Products, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Dorman Products, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+359 added−416 removedSource: 10-K (2026-02-27) vs 10-K (2025-02-27)

Top changes in Dorman Products, Inc.'s 2025 10-K

359 paragraphs added · 416 removed · 259 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeCombined, we estimate that these three sectors had a total addressable market of over $165 billion in 2024, according to information we have derived from the 2025 Auto Care Association Factbook and other industry data. Light-Duty Vehicle Sector The majority of our products are designed for light-duty vehicles, which are passenger cars and light-duty trucks.
Biggest changeThe Motor Vehicle Aftermarket Industry We sell our parts in three different sectors of the motor vehicle aftermarket industry: light-duty, heavy-duty, and powersports (i.e., specialty vehicles). Combined, we estimate that these three sectors had a total addressable market of over $165 billion in 2025, based on information we derived from the 2026 Auto Care Association Factbook and other industry data.
Individual consumers typically are supplied through retailers and the retail arms of warehouse distributors. Vehicle repair shops generally purchase parts through local independent parts wholesalers and national parts distributors. Automobile dealership service departments generally obtain parts through the distribution systems of vehicle manufacturers and specialized national and regional parts distributors.
Individual consumers are typically supplied through retailers and the retail arms of warehouse distributors. Vehicle repair shops generally purchase parts through local independent parts wholesalers and national parts distributors. Automobile dealership service departments generally obtain parts through the distribution systems of vehicle manufacturers and specialized national and regional parts distributors.
Thus, the reputation for quality, customer service, and line profitability that a supplier provides typically are significant factors in a retailer’s or other reseller’s decision as to which product lines to carry in the limited space available.
Thus, the reputation for quality, customer service, and line profitability that a supplier provides are typically significant factors in a retailer’s or other reseller’s decision as to which product lines to carry in the limited space available.
These parts are made to help save the service technician time and money, and increase reliability and serviceability. HELP! ® – Parts and components designed to help the automotive do-it-yourself customer, or DIYer, save time and money. A fixture in auto parts store aisles for decades.
These parts are made to help save the service technician time and money, and to increase reliability and serviceability. HELP! ® – Parts and components designed to help the automotive do-it-yourself customer, or DIYer, save time and money. A fixture in auto parts store aisles for decades.
In addition, we will provide, at no cost, paper or electronic copies of our reports and other filings made with the SEC. Requests should be directed to: Attention: Secretary, Dorman Products, Inc., 3400 East Walnut Street, Colmar, Pennsylvania 18915.
In addition, we will provide, at no cost, paper or electronic copies of our reports and other filings made with the SEC. Requests should be directed to: Dorman Products, Inc., Attention: Secretary, 3400 East Walnut Street, Colmar, Pennsylvania 18915.
We categorize our product development opportunities across three different spectrums: (1) alternative parts - direct aftermarket replacements for factory parts, (2) upgraded parts (including our "OE FIX" line) – parts with enhanced design, functionality, or features based on identifying what made original parts problematic and developing new solutions that address the original failure modes, and (3) new parts - identifying parts that are not available from the OE or in the aftermarket that can enhance vehicle performance and user experience.
We categorize our product development opportunities across three different spectrums: (1) alternative parts – direct aftermarket replacements for factory parts, (2) upgraded parts (including our "OE FIX" line) – parts with enhanced design, functionality, or features based on identifying what made original parts problematic and developing new solutions that address the original failure modes, and (3) new parts – identifying parts that are not available from the OEMs or in the aftermarket that can enhance vehicle performance and user experience.
For information on risks relating to our human capital resources, see ITEM 1A, “Risk Factors – General Risk Factors – Losing the services of our executive officers or other highly qualified and experienced employees, or failing to attract and retain any of such officers or employees, could adversely affect our business.” Available Information Our Internet address is dormanproducts.com.
For information on risks relating to our human capital resources, see ITEM 1A, “Risk Factors – General Risk Factors – Losing the services of our executive officers or other highly qualified and experienced employees, or failing to attract and retain any of such officers or employees, could adversely affect our business.” Available Information Our primary Internet address is DormanProducts.com.
Investing in 8 our Contributors and promoting an environment where they feel valued and empowered is an essential part of our culture. We believe developing talented, successful people helps drive the long-term performance of our business. Talent and Development Our talent strategy is focused on attracting the best talent, developing their skill sets and experiences, and rewarding their performance.
Investing in our Contributors and promoting an environment where they feel valued and empowered is an essential part of our culture. We believe developing talented, successful people helps drive the long-term performance of our business. Talent and Development Our talent strategy is focused on attracting the best talent, developing their skill sets and experiences, and rewarding their performance.
We conduct an executive compensation benchmarking review annually to help ensure we are providing market-based compensation, including base salary, and short-term and long-term incentives. We also participate in annual compensation surveys for all positions and strive to compensate our top talent and key roles competitively.
We conduct an executive compensation benchmarking review annually to help ensure we are providing market-based compensation, including base salary, and short-term and long-term incentives for our executives. We also participate in annual compensation surveys for all positions and strive to compensate our top talent and key roles competitively.
Our hardware products include threaded bolts and auto body fasteners, automotive and home electrical wiring components, and other hardware assortments and merchandise. 4 We warrant our products against certain defects in material and workmanship when used as designed on the vehicle on which it was originally installed.
Our hardware products include threaded bolts and auto body fasteners, automotive and home electrical wiring components, and other hardware assortments and merchandise. We warrant our products against certain defects in material and workmanship when used as designed on the vehicle on which it was originally installed.
Some of our most popular brands include: DORMAN ® – Reliable replacement automotive parts and components. A brand mechanics have trusted for more than 100 years. DORMAN ® OE FIX ™ – Dorman products that are designed to be better repair solutions than the OE alternative.
Some of our most popular brands include: DORMAN ® – Reliable replacement automotive parts and components. A brand mechanics have trusted for more than 100 years. DORMAN ® OE FIX ™ – Dorman products that are designed to be better repair solutions than the OEMs' alternative.
We also maintain a human rights policy for the organization outlining our commitment to operating with respect for human rights. Culture of Contribution We refer to our employees as “Contributors” because we are a team of innovators, collaborators, and problem-solvers working toward meaningful and mutual goals.
We also maintain a human rights policy for the organization outlining our commitment to operating with respect for human rights. 8 Culture of Contribution We refer to our employees as “Contributors” because we are a team of innovators, collaborators, and problem-solvers working toward meaningful and mutual goals.
We offer a limited lifetime warranty on most of our products in the light- and medium-duty parts categories, with more limited warranties for our heavy-duty and specialty vehicle products. Our standard warranties provide for the repair or replacement of the non-performing part.
We offer a limited lifetime warranty on most of our products in 4 the light- and medium-duty parts categories, with more limited warranties for our heavy-duty and specialty vehicle products. Our standard warranties provide for the repair or replacement of the non-performing part.
Health and Safety We maintain a safety culture grounded on the premise of eliminating workplace incidents, risks, and hazards. We have created and implemented processes to help eliminate safety events and reduce their frequency and severity. We also review and monitor our safety performance closely.
Health and Safety We maintain a safety culture grounded on the premise of eliminating workplace incidents, risks, and hazards. We have created and implemented processes to help eliminate safety events and reduce their frequency and severity. We also review and monitor our safety performance.
The service work performed on medium- and heavy-duty vehicles is generally completed by end-user businesses that utilize these vehicles in their operations, fleets, and independent garages and distributors, who buy parts from the purchasers above or in some instances directly from suppliers like us. The majority of our sales in the heavy-duty vehicle sector are related to replacement parts.
The service work performed on medium- and heavy-duty vehicles is generally completed by end-user businesses that utilize these vehicles in their operations, fleets, and independent garages and distributors, who buy parts from the purchasers above or, in some instances, directly from suppliers like us. The majority of our sales in the heavy-duty vehicle sector are replacement parts.
Further, because of the efficiencies achieved through the ability to order all or part of a complete line of products from one supplier (with possible volume discounts), as opposed to satisfying the same requirements through a variety of different sources, retailers and other resellers of light-duty aftermarket parts often seek to purchase products from fewer but stronger suppliers.
Further, because of the efficiencies achieved through the ability to order all or part of a complete line of products from one supplier (with possible volume discounts), as opposed to satisfying the same requirements through a variety of different sources, retailers and other resellers of light-duty aftermarket parts may seek to purchase products from fewer but stronger suppliers.
Professional installers include: (i) individual vehicle repair shops, representing approximately 70% of the total aftermarket vehicle repair industry according to the Motor & Equipment Manufacturers Association, which generally service a variety of OEM vehicle makes and models and sell and install non-OEM aftermarket parts; and (ii) dealership service departments, which generally only service specific brands of OEM vehicles and sell and install those same OEM brand aftermarket parts.
Professional installers include: (i) individual vehicle repair shops, representing approximately 70% of the total aftermarket vehicle repair industry according to the Motor & Equipment Manufacturers Association, which generally service a variety of OEMs' vehicle makes and models and sell and install non-OEMs' aftermarket parts; and (ii) dealership service departments, which generally only service specific brands of OEMs' vehicles and sell and install those same OEMs' brand aftermarket parts.
We also face competition from OE manufacturers who sell through their dealerships many of the same replacement parts that we sell, although these manufacturers generally sell parts only for vehicles they produce. Some of our current or former suppliers may compete with us by supplying directly to our customers. Further, some of our private label customers also compete with us.
We also face competition from OEMs who sell through their dealerships many of the same replacement parts that we sell, although these manufacturers generally sell parts only for vehicles they produce. Some of our current or former suppliers may compete with us by supplying directly to our customers. Further, some of our private-label customers also compete with us.
Our products are sold primarily through aftermarket retailers, including through their online platforms; dealers; national, regional, and local wholesale distributors and specialty markets; and salvage yards. We also distribute aftermarket parts outside the United States, with sales primarily into Canada and Mexico, and to a lesser extent, Europe, the Middle East, and Australia.
Our products are sold primarily through aftermarket retailers, including their online platforms; dealers; and national, regional, and local wholesale distributors and specialty markets. We also distribute aftermarket parts outside the United States, with sales primarily into Canada and Mexico, and to a lesser extent, Europe, the Middle East, and Australia.
In 2024, we purchased motor vehicle products in substantial volumes from over 400 suppliers, and no single supplier accounted for more than 10% of our total product purchases. For more information on risks relating to our supply chain, see ITEM 1A.
In 2025, we purchased motor vehicle products in substantial volumes from over 400 suppliers, and no single supplier accounted for more than 10% of our total product purchases. For more information on risks relating to our supply chain, see ITEM 1A.
Substantially all our products are subject to competition with similar products offered by other providers. Some of these competitors are divisions and subsidiaries of companies much larger than ours that possess a longer history of operations and greater financial and other resources than we do.
Substantially all our products are subject to competition with similar products offered by other providers. Some of these competitors are divisions and subsidiaries of companies much larger than us that possess a longer history of operations and greater financial and other resources than we do.
Packaged inventory is either stocked in the warehouse portions of our facilities or in distribution centers maintained by our third-party logistics providers and is organized to facilitate the most efficient methods of retrieving product to fill customer orders.
Packaged inventory is either stocked in the warehouse portions of our facilities or in distribution centers maintained by our third-party logistics providers and is organized to facilitate the most efficient methods of retrieving products to fill customer orders.
“Administration” includes executive officers and individuals employed in finance, legal, information technology, human resources, and other functions supporting our business. The following table shows employees by function and region. December 31, 2024 U.S. Non-U.S.
“Administration” includes executive officers and individuals employed in finance, legal, information technology, human resources, and other functions supporting our business. The following table shows employees by function and region. December 31, 2025 U.S. Non-U.S.
These parts include, among other parts, leaf springs, intake manifolds, exhaust manifolds, oil filters and coolers, window regulators, radiator fan assemblies, tire pressure monitor sensors, exhaust gas recirculation (EGR) coolers, driveshafts, UTV windshields, and complex electronics modules.
These parts include, among others, leaf springs, intake manifolds, exhaust manifolds, oil filters and coolers, window regulators, radiator fan assemblies, tire pressure monitor sensors, exhaust gas recirculation ("EGR") coolers, driveshafts, UTV windshields, and complex electronics modules.
Customers and end-users that purchase a remanufactured replacement part will generally return the used core to us, which we then use in the remanufacturing process to make another finished good.
Customers and end-users who purchase a remanufactured replacement part will generally return the used core to us, which we then use in the remanufacturing process to make another finished good.
Extremely hot or cold weather generally results in an increase in parts failure at an accelerated rate, which generally leads to an increase in our sales for the duration of the extreme weather event.
Extremely hot or cold weather generally results in an increase in parts failing at an accelerated rate, which generally leads to an increase in our sales for the duration of the extreme weather event.
For a more detailed discussion of these risks, please see ITEM 1A, "Risk Factors – Risks Related to Our Business – Product Development, Acceptance, and Quality and Regulations.” Human Capital Resources General As of December 31, 2024, we had 3,787 employees worldwide, substantially all of whom were employed full-time. Our employees are categorized by various functions.
For a more detailed discussion of these risks, please see ITEM 1A, "Risk Factors – Risks Related to Our Business – Product Development, Acceptance, and Quality and Regulations.” Human Capital Resources General As of December 31, 2025, we had 3,871 employees worldwide, substantially all of whom were employed full-time. Our employees are categorized by various functions.
Packaged product generally contains our label (or a private label), a part number, a universal packaging bar code suitable for electronic scanning, a description of the part, and if appropriate, installation instructions. Products are also sold in bulk to automotive parts manufacturers and packagers.
Packaged products generally contain our label (or a private label), a part number, a universal packaging bar code suitable for electronic scanning, a description of the part, and, if appropriate, installation instructions. Products are also sold in bulk to automotive parts manufacturers and packagers.
Spending in the light-duty vehicle sector generally can be grouped into three categories: discretionary, maintenance, and repair. Discretionary, such as upgrade accessories and performance, tends to align with consumer discretionary spending. Maintenance is composed of products and services, such as oil and oil changes, and tends to be less correlated with discretionary spending.
Spending in the motor vehicle aftermarket sector generally can be grouped into three categories: discretionary, maintenance, and repair. Discretionary, such as upgrade accessories and performance, tends to align with consumer discretionary spending. Maintenance is composed of products and services, such as oil and oil changes, and tends to be less correlated with discretionary spending.
Some of these opportunities are new to the aftermarket whereas others continue to expand our current portfolio offering.
Some of these opportunities are new to the aftermarket, while others continue to expand our current portfolio offering.
Our products are available in our customers’ retail stores, on our website and our customers’ websites, and through dealers and warehouse distributors. As of December 31, 2024, we had a sales and sales support team of approximately 300 people selling our products either directly to our customers or, for certain select customers, indirectly using independent manufacturers’ representative agencies worldwide.
Our products are available in our customers’ retail stores, online, and through dealers and warehouse distributors. As of December 31, 2025, we had a sales and sales support team of approximately 300 people selling our products either directly to our customers or, for certain select customers, indirectly using independent manufacturers’ representative agencies worldwide.
The following table represents the number of distinct parts we introduced for each of the last three years: Year Ended December 31, 2024 2023 2022 New to the aftermarket 1,659 1,791 1,762 Line extensions 3,676 4,315 3,667 Total distinct parts introduced 5,335 6,106 5,429 In 2024, we introduced a range of innovative, first-to-the-aftermarket repair solutions for the light-duty vehicle sector, designed to fit a wide variety of vehicles.
The following table represents the number of distinct parts we introduced for each of the last three years: Year Ended December 31, 2025 2024 2023 New to the aftermarket 1,608 1,659 1,791 Line extensions 3,952 3,676 4,315 Total distinct parts introduced 5,560 5,335 6,106 In 2025, we introduced a range of innovative, first-to-the-aftermarket repair solutions for the light-duty vehicle sector, designed to fit a wide variety of vehicles.
For 2024, approximately 81% of our products were sold under brands that we own, and the remainder of our products were sold for resale under customers' private labels, other brands, or in bulk. We generate most of our net sales from customers in North America, primarily in the United States.
For 2025, approximately 76% of our products were sold under brands we own, and the remainder of our products were sold for resale under customers' private labels, other brands, or in bulk. We generate most of our net sales from customers in North America, primarily in the United States.
We focus significant attention on attracting and retaining talented and experienced individuals to manage and support our operations, and our leadership team routinely reviews employee turnover rates at various levels of the organization. Leadership also participates in a robust annual talent review and succession planning process.
We focus significant attention on attracting and retaining talented and experienced individuals to manage and support our operations, and our leadership team routinely reviews employee turnover rates at various levels of the organization. Leadership also participates in a robust annual talent review and succession planning process. In addition, leadership reviews employee engagement surveys to monitor employee morale and receive feedback.
As of December 31, 2024, we marketed approximately 138,000 distinct parts compared to approximately 133,000 as of December 31, 2023, many of which we designed and engineered.
As of December 31, 2025, we marketed approximately 144,000 distinct parts compared to approximately 138,000 as of December 31, 2024, many of which we designed and engineered.
Patents, Trademarks, and Other Intellectual Property We own patents important to our business, and we expect to continue to file patent applications to protect our research and development investments in new products. As of December 31, 2024, we held 127 patents and 94 pending patent applications worldwide. In addition, we hold numerous trademarks in the United States and other countries.
Patents, Trademarks, and Other Intellectual Property We own patents important to our business, and we expect to continue filing patent applications to protect our research and development investments in new products. As of December 31, 2025, we held 132 patents and 82 pending patent applications worldwide. In addition, we hold numerous trademarks in the United States and other countries.
Our sales efforts are not directed merely at selling individual products, but more broadly towards selling our entire product portfolio. Our sales strategy includes increasing sales not only by securing new customers, but also by adding new product lines and expanding product selection within existing customers in an effort to make our customers a destination for our aftermarket products.
Our sales efforts are directed broadly towards selling our entire product portfolio, not solely towards selling individual products. Our sales strategy includes increasing sales by securing new customers, adding new product lines, and expanding product selection for existing customers in an effort to make our customers a destination for our aftermarket products.
In 2024, as a percentage of our total dollar volume of purchases, approximately 28% of our products were purchased from third-party suppliers throughout the United States and the balance of our purchases were from third-party suppliers outside of the United States. In 2024, approximately 45% of our products were purchased from third-party suppliers located in China.
In 2025, as a percentage of our total dollar volume of purchases, approximately 23% of our products was purchased from third-party suppliers throughout the United States, and the balance of our purchases were from third-party suppliers outside of the United States. In 2025, approximately 38% of our total volume of purchases of products were from third-party suppliers located in China.
Historically, we have done so organically, through commercial relationships, or in connection with acquisitions. 7 For more information concerning the risks related to patents, trademarks, and other intellectual property, see ITEM 1A, "Risk Factors – Risks Related to Our Business – Our Intellectual Property and Information Security.” Product Safety & Regulatory Affairs Our products and the vehicles in which they are used may be subject to safety laws and regulations promulgated by federal, state/provincial, and local governments around the world.
For more information concerning the risks related to patents, trademarks, and other intellectual property, see ITEM 1A, "Risk Factors – Risks Related to Our Business – Our Intellectual Property and Information Security.” Product Safety & Regulatory Affairs Our products and the vehicles in which they are used may be subject to safety laws and regulations promulgated by federal, state/provincial, and local governments around the world.
We also have licenses to intellectual property for the manufacture, use, and sale of certain of our products. We obtain patent and other intellectual property rights used in connection with our business when practicable and when we deem it appropriate.
We also have licenses to intellectual property for the manufacture, use, and sale of certain of our products. 7 We obtain patent and other intellectual property rights used in connection with our business when practicable and when we deem it appropriate. Historically, we have done so organically, through commercial relationships, or in connection with acquisitions.
As of December 31, 2024, we serviced approximately 10,000 active accounts. During 2024, two customers each accounted for more than 10% of net sales and in the aggregate accounted for approximately 39% of net sales. Manufacturing and Procurement Most of our light-duty vehicle products are manufactured by third parties, as are the majority of our heavy-duty vehicle products.
During 2025, we had two customers that individually accounted for more than 10% of net sales and, in the aggregate, accounted for approximately 40% of net sales. Manufacturing and Procurement Most of our light-duty vehicle products are manufactured by third parties, as are the majority of our heavy-duty vehicle products.
In addition, leadership reviews employee engagement surveys to monitor employee morale and receive feedback on a variety of issues. Compensation We pay our employees competitively and offer a broad range of company-paid benefits, which we believe are competitive with others in our industry and in the geographies in which we compete for talent.
Compensation We pay our employees competitively and offer a broad range of company-paid benefits, which we believe are competitive with others in our industry and in the geographies in which we compete for talent.
Among other things, we use digital advertising, social media, email, catalogs, and brochures to describe and promote our products. Our websites include DormanProducts.com, DaytonParts.com, and SuperATV.com. These sites are not and should not be considered part of this Form 10-K and are not incorporated by reference in this Form 10-K.
Among other things, we use digital advertising, social media, email, catalogs, and brochures to describe and promote our products. Our websites include, but are not limited to, DormanProducts.com, DaytonParts.com, and SuperATV.com.
Retailers and others who purchase light-duty aftermarket parts for resale often are constrained to a finite amount of space in which to display and stock products.
See ITEM 1A, “Risk 2 Factors – Risks Related to Our Business – Our Industry, Operations and Competition” for information regarding the potential impacts of consolidation on our business. Retailers and others who purchase light-duty aftermarket parts for resale often are constrained to a finite amount of space in which to display and stock products.
Remanufacturing and Recycling Parts Certain products we sell contain parts that can be recycled, or as more commonly referred to in our industry, remanufactured. We refer to the used product that is ultimately remanufactured as core. A used core is remanufactured and sold to the customer as a replacement for a unit on a vehicle.
We refer to the used product that is ultimately remanufactured as core. A used core is remanufactured and sold to the customer as a replacement for a unit on a vehicle.
In addition to utilizing our dealer networks, our specialty vehicle products that are ordered through SuperATV websites may be shipped directly to customers. In certain circumstances, at the request of a customer, we ship directly to that customer's warehouses, stores, or other locations, either via smaller direct ship orders or consolidated store orders that are cross-docked.
In certain circumstances, at the request of a customer, we ship directly to that customer's warehouses, stores, or other locations, either via smaller direct ship orders or consolidated store orders that are cross-docked. Remanufacturing and Recycling Parts Certain products we sell contain parts that can be recycled or, as more commonly referred to in our industry, remanufactured.
The majority of our net sales are from products that fall into the repair category. The increasing complexity and the number of different makes and models of light-duty vehicles have resulted in a significant increase in the number of products required to service domestic and foreign automotive fleets.
The increasing complexity and the number of different makes and models of light-duty vehicles have resulted in a significant increase in the number of products required to service domestic and foreign automotive fleets. The requirement to include more products in inventory and the significant consolidation among distributors of automotive replacement parts have, in turn, resulted in larger distributors.
Total Operations 2,604 232 2,836 Product Development 210 1 211 Quality and Engineering 176 79 255 Sales 265 14 279 Administration 197 9 206 Total Employees 3,452 335 3,787 None of our global employees is covered by a collective bargaining agreement. We consider our relations with our employees to be generally good.
Total Operations 2,669 241 2,910 Product Development 231 2 233 Quality and Engineering 161 95 256 Sales 248 18 266 Administration 194 12 206 Total Employees 3,503 368 3,871 None of our employees is covered by a collective bargaining agreement. We consider our relations with our employees to be generally good.
Our product launches included “OE FIX” solutions such as loaded magnetic strut assemblies, turbo line replacement kits, and fully loaded knuckle assemblies. We also expanded our investment in our emerging technology solutions portfolio to support repairs for complex automotive electronic components. This included the release of transmission control modules, electronic power steering racks, and various other control modules and sensors.
Our product launches included “OE FIX” solutions such as exhaust manifolds, metal heater hose connectors, and aluminum oil filter housings for additional makes and models of vehicles. We also expanded our investment in our emerging technology solutions portfolio to support repairs for complex automotive electronic components.
We strive to maintain a level of inventory to adequately meet current customer order demand with additional inventory to satisfy new customer orders and special programs. We ship our products by contract carrier, common carrier, or parcel service. Products are generally shipped to each customer's main warehouses for redistribution within its network or to dealers for further resale.
We ship our products by contract carrier, common carrier, or parcel service. Products are generally shipped to each customer's main warehouses for redistribution within its network or to dealers for further resale. In addition to utilizing our dealer networks, our specialty vehicle products that are ordered through SuperATV websites may be shipped directly to customers.
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The Motor Vehicle Aftermarket Industry We sell our parts in three different sectors of the motor vehicle aftermarket industry: light-duty, heavy-duty, and powersports (i.e., specialty vehicles).
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The majority of our net sales are from products in the repair category. Light-Duty Vehicle Sector Most of our products are designed for light-duty vehicles, which are passenger cars and light-duty trucks.
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The requirement to include more products in inventory and the significant consolidation among 2 distributors of automotive replacement parts have in turn resulted in larger distributors. See ITEM 1A, “Risk Factors – Risks Related to Our Business – Our Industry, Operations and Competition” for information regarding the potential impacts of consolidation on our business.
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This included the release of active grille shutters, front impact sensors, and various other control modules and sensors. Additionally, we made significant additions to our industry-leading lines of active suspension components, loaded knuckles, and chassis components. We continued to expand and launch new products across the heavy-duty vehicle sector in 2025, including within our core categories.
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Additionally, we made significant additions to our industry-leading lines of turbo accessories, coolers, and chassis components. In 2024, we significantly expanded our heavy-duty product portfolio, introducing a comprehensive range of brake components—including drums and rotors—along with a new king pin program for connecting trucks and trailers and enhancements to our leaf spring coverage.
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Among other things, we introduced line extensions for air disc rotors and new consolidated brake shoe kits, and we further expanded our branded shock absorber program. We also advanced our efforts to deliver “new-to-the-aftermarket solutions” for the heavy-duty industry, releasing new EGR coolers, fuel dosing modules, and branded air tanks.
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Additionally, we launched several aftermarket-exclusive products, including EGR coolers, after-treatment injectors, and engine sensors. Most notably, we proudly debuted our Dayton Exhaust components line, delivering innovative solutions for both above and below-chassis applications for Class 7 and Class 8 trucks.
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Additionally, we introduced new branded front displays for our retail customers, creating strong opportunities to drive sales growth and increase brand presence in our customers’ front rooms.
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In the specialty vehicles sector, in 2024 we released many first-to-the-aftermarket products covering accessories and nondiscretionary repair parts, including a complete line of geared reverse direct replacement transmissions for multiple makes and models of ATVs and UTVs. We expanded our Ready Fit ® winch line, which is designed to significantly reduce installation time for the customer.
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For the specialty vehicle sector, in 2025, we continued enhancing our lineup of break-fix and direct replacement parts by introducing new products and expanding fitment opportunities for existing product categories, including water pumps, fuel pumps, radiator assemblies, and brake calipers.
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We also continued our investment in innovative solutions to enhance the rider experience like a rear steer kit, driver-adjustable electronic power steering, and creature comfort items that provide improved heat and air flow within the cab, such as our electronic thermostat bypass heaters and roof-mounted fan system. 5 Sales and Marketing We market our products to purchasers, many of whom in turn supply individual consumers and professional installers.
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Additionally, we introduced a new proprietary XR Optic Hard Coating across our scratch-resistant polycarbonate windshield line and redesigned our power flip windshield for improved ergonomics. We also released a wide range of first-to-market innovations enhancing driver and passenger comfort and machine usability.
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Our product launches included two new tire lines with advanced proprietary tread designs to optimize performance, advanced turn signal kits that integrate with machine electronics, and rugged utility vehicle doors. 5 Sales and Marketing We market our products to purchasers, many of whom in turn supply individual consumers and professional installers.
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These sites are not and should not be considered part of this Annual Report on Form 10-K and are not incorporated by reference in this Annual Report on Form 10-K. As of December 31, 2025, we serviced approximately 9,000 active accounts.
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We continue to invest in technology and automation to improve the efficiency of our operations, including implementing warehouse orchestration software and utilizing autonomous mobile robots and vertical lift modules at several of our locations. We strive to maintain a level of inventory to adequately meet current customer order demand, with additional inventory to satisfy new customer orders and special programs.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeFactors that could impact our customers' growth and competitiveness include: • Technological Changes : Technological advancements and the complexity of motor vehicles may render our customers less competitive if they do not make adequate investments in their businesses, including, but not limited to, investments in training and tools; • Competitive Pressures : Increased competition from existing or new market entrants (e.g., the growth of e-commerce) could erode our customers' market share, impacting their business performance and, consequently, their demand for our products; and • Shelf Space Limitations : The amount of space available to retailers and other resellers of our products is limited, and, therefore, our products compete with other motor vehicle aftermarket products, some of which are entirely dissimilar and otherwise non-competitive (such as car waxes and engine oil), for shelf and floor space.
Biggest changeOur customers’ growth and competitiveness can be affected by, among other things: • Technological Changes : Increasing vehicle complexity may require our customers to make investments in training and tools, and failure to adapt may reduce their ability to compete. • Competitive Pressures : Increased competition from existing or new market entrants (e.g., the growth of e-commerce) could erode our customers' market share, impacting their business performance and, consequently, their demand for our products. • Shelf Space Limitations : Limited retail space forces our products to compete with other aftermarket items, including unrelated products.
The failure of our customers to increase shelf space or grow in new locations may adversely impact their demand for our products.
The failure of our customers to increase their shelf space or grow in new locations may adversely impact their demand for our products.
To the extent that the U.S. dollar changes in value relative to those foreign currencies in the future, the prices charged by our suppliers under new purchase orders may change in equivalent U.S. dollars. For example, the Chinese yuan to U.S. dollar exchange rate has fluctuated over the past several years.
To the extent the U.S. dollar changes in value relative to those foreign currencies in the future, the prices charged by our suppliers under new purchase orders may change in equivalent U.S. dollars. For example, the Chinese yuan to U.S. dollar exchange rate has fluctuated over the past several years.
When increases are made to U.S. duty rates or tariffs, reciprocal action by other countries sometimes occurs, and any such increases could impact the price of our products and cause a decline in the demand for our products.
In addition, when increases are made to U.S. duty rates or tariffs, reciprocal action by other countries sometimes occurs, and any such increases could impact the price of our products and cause a decline in the demand for our products.
ITEM 1A. Risk Factors In addition to the other information set forth in this report, you should carefully consider the following factors, which could materially affect our business, financial condition, or future results. The risks described below are not the only risks we face.
ITEM 1A. Risk Factors In addition to the other information set forth in this report, you should carefully consider the following factors, which could materially affect our business, financial condition, or future results. The risks described below, which are listed in no particular order, are not the only risks we face.
A decision by any significant customer, whether motivated by competitive conditions, financial difficulties, or otherwise, to materially decrease the amount of products purchased from us or the number of our product lines they choose to carry, to change their manner of doing business with us, or to stop doing business with us, could have a material adverse effect on our business, financial condition, and results of operations.
A decision by any significant customer to materially decrease the amount of products purchased from us or the number of our product lines they choose to carry, to change their manner of doing business with us, or to stop doing business with us, could have a material adverse effect on our business, financial condition, and results of operations.
There is also a possibility that we may miss a market opportunity because we failed to invest or invested too late in a technology, product, or enhancement sought by our customers or the markets into which we sell.
There is also a possibility that we may miss a market opportunity because we failed to invest or invested too late in a technology, product, or enhancement sought by our customers or our markets.
Cyber-attacks or other breaches of network or information technology security may cause equipment failure, disruption to our operations, or the loss or theft of sensitive data relating to our Company and our employees, customers, suppliers, and business partners, including intellectual property, proprietary business information, and other sensitive material.
Our Intellectual Property and Information Security Cyber-attacks or other information technology security breaches could adversely impact our business and operations. 14 Cyber-attacks or other information technology security breaches may cause equipment failure, disruption to our operations, or the loss or theft of sensitive data relating to our company and our employees, customers, suppliers, and business partners, including intellectual property, proprietary business information, and other sensitive material.
The loss or decrease in sales among one of our top customers, or a material change in the terms on which they are willing to buy from us, could have a substantial negative impact on our sales and operating results.
The loss or decrease in sales among one of our top customers, or a material change in the terms on which they are willing to buy from us, could have a substantial negative impact on our sales and operating results. A significant percentage of our sales are concentrated among a relatively small number of customers.
Furthermore, because the techniques used to carry out cyber-attacks change frequently and in many instances are not recognized until after they are used against a target, we may be unable to anticipate these changes or implement adequate preventative measures.
Furthermore, because the techniques used to carry out cyber-attacks change frequently and in many instances are not recognized until after they are used against a target, we may be unable to anticipate these changes or implement adequate preventative measures. Responding to such incidents also could require significant costs.
Moreover, sales of substantial amounts of the shares beneficially owned by Mr. Berman and his family members, including shares held in family trusts and foundations, or the perception that such sales could occur, may lower the prevailing market price of our common stock. General Risk Factors Unfavorable economic conditions may adversely affect our business.
Berman or his family, including shares held in family trusts and foundations—or the perception that such sales could occur—may lower the prevailing market price of our common stock. General Risk Factors Unfavorable economic conditions may adversely affect our business.
If we fail to maintain sufficient inventory to meet current customer demands, or if we fail to anticipate future changes in customer demands, our financial results could be adversely affected. We must maintain sufficient in-stock inventory and anticipate future changes in customer demands to be successful. If we fail to do so, our financial results could be adversely affected.
If we fail to maintain sufficient inventory to meet current customer demands, or if we fail to anticipate future changes in customer demands, our financial results could be adversely affected. We must maintain adequate inventory and anticipate changes in customer demand to meet current and future needs. Failure to do so could adversely affect our financial results.
If we are unable to generate sufficient cash flow from operations to service our indebtedness, we may be required to, among other things: refinance or restructure all or a portion of our indebtedness; reduce or delay planned capital or operating expenditures; reduce, suspend, or eliminate our stock repurchase program; or sell selected assets.
If we are unable to generate sufficient cash flow to service our indebtedness, we may be required to, among other things: refinance or restructure all or a portion of our indebtedness; reduce or delay planned capital or operating expenditures; reduce, suspend, or eliminate our stock repurchase program; raise additional capital through sales of our securities, which may not be on favorable terms; or sell selected assets.
Import and export controls and economic sanctions laws and regulations include restrictions and prohibitions on the sale or supply of certain products and on our transfer of parts, components, and related technical information and know-how to certain countries, regions, governments, persons, and entities.
Our products are subject to import and export controls and economic sanctions laws and regulations in various jurisdictions, and violations could adversely affect us. 19 Import and export controls and economic sanctions laws and regulations include restrictions and prohibitions on the sale or supply of certain products and on our transfer of parts, components, and related technical information and know-how to certain countries, regions, governments, persons, and entities.
We cannot assure you that our competitors or others in our industry will not (i) adopt fast follower strategies, based on the Company's new product launches, (ii) develop products or services that are equal or superior to our products, or that achieve greater market acceptance than our products, or (iii) expand their operations into product lines produced and sold by us.
We cannot assure you that competitors will not (i) adopt fast follower strategies, based on our new product launches, (ii) develop products or services that are equal or superior to our products, or that achieve greater market acceptance than our products, or (iii) expand into our product lines.
If illegal transshipments are not monitored and enforcement is not effective to limit them, these shipments could have a material adverse effect on our business, financial condition, and results of operations.
If illegal transshipments are not monitored and enforcement is not effective to limit them, we may not be able to compete effectively, and that could have a material adverse effect on our business, financial condition, and results of operations.
Such customers may require us to provide extended payment terms, issue customer credits, and accept returns of slow-moving product to obtain new, or retain existing, business. Although we attempt to avoid or minimize such concessions, in some cases customer payment terms have been extended, enhanced credits have been issued and returns of product have exceeded historical levels.
They may ask us to lower prices, provide extended payment terms, issue customer credits, and accept returns of slow-moving product to obtain new, or retain existing, business. While we seek to limit such concessions, in some cases customer payment terms have been extended, enhanced credits have been issued, and returns of product have exceeded historical levels.
As a result of these and other factors, we have experienced and expect to continue to experience fluctuating levels of demand that require us to monitor, and, where appropriate, adjust our operations, including our inventory levels and staffing at our facilities.
As a result of these and other factors, we have experienced and expect to continue to experience fluctuating levels of demand that require us to monitor, and, where appropriate, adjust our operations, including our inventory levels and staffing at our facilities. Inaccurate forecasting can lead to excess or obsolete inventory, workforce reductions, or, conversely, inventory shortages and insufficient staffing.
Our inability to maintain a competitive cost structure or to pass through increases in costs to our customers could have a material adverse effect on our business, financial condition, and results of operations. The inability of our customers to grow their businesses and compete effectively may adversely affect our business.
Our inability to maintain a competitive cost structure could have a material adverse effect on our business, financial condition, and results of operations. Our business depends on the ability of our customers to grow their businesses and compete effectively.
Furthermore, the replacement of a key supplier or transitioning to a new supplier in a different geography may result in production delays, product quality issues, or increased expenses, which could result in inventory shortages or lower profit margins and could have a material adverse effect on our business, financial condition, and results of operations.
Furthermore, the replacement of a key supplier or transitioning to a new supplier in a different geography may result in production delays, product quality issues, or increased expenses, which could result in inventory shortages or lower profit margins.
Furthermore, in general, pricing increases that we implemented to pass through the increased costs had no added profit dollars and consequently did not fully offset the impact that the increased costs had on our gross and operating margin percentages. Moreover, pricing actions such as these may have a negative impact on customers’ willingness to purchase our products.
Furthermore, in general, pricing increases that we implemented to pass through the increased costs had no added profit dollars and consequently did not fully offset the impact that the increased costs had on our gross and operating margin percentages.
Complying with export control and sanctions laws for a particular sale may be time-consuming, may increase our costs, and may result in the delay or loss of sales opportunities.
Complying with export control and sanctions laws for a particular sale may be time-consuming, may increase our costs, and may result in the delay or loss of sales opportunities. Violations may lead to investigations, fines, penalties, reputational harm, and limits on trade.
Accordingly, we generally do not have exposure to fluctuations in the relationship between the U.S. dollar and various foreign currencies between the time of execution of the purchase order and payment for the product.
In addition, products we purchase from foreign suppliers generally are purchased through purchase orders with the purchase price specified in U.S. dollars. Accordingly, we generally do not have exposure to fluctuations in the relationship between the U.S. dollar and various foreign currencies between the time of execution of the purchase order and payment for the product.
If we believe or have reason to believe that our employees or agents have or may have violated applicable anti-corruption laws, or if we are subject to allegations of any such violations, we may be required to investigate or have outside counsel investigate the relevant facts and circumstances, which can be expensive and require significant time and attention from senior management.
If we believe or have reason to believe that our employees, agents, or suppliers have or may have violated applicable ABAC laws, or if we are subject to allegations of any such violations, we may be required to investigate or have outside counsel investigate the relevant facts and circumstances.
These factors could have a material adverse effect on our business, financial condition, and results of operations. Our industry is highly competitive, and our success depends on our ability to compete with suppliers of motor vehicle aftermarket products, some of which may have greater financial, marketing, and other resources than we do.
Our industry is highly competitive, and our success depends on our ability to compete with suppliers of motor vehicle aftermarket products, some of which may have greater financial, marketing, and other resources than we do. The motor vehicle aftermarket industry is highly competitive, and our success depends on our ability to compete with domestic and international suppliers of aftermarket products.
Shareholder activism could cause us to incur substantial costs, adversely affect our relationships with suppliers, customers, and regulators, and adversely impact our stock price. Losing the services of our executive officers or other highly qualified and experienced employees or failing to attract and retain any of such officers or employees could adversely affect our business.
Additionally, volatility may attract shareholder activism, including proxy contests or public campaigns, which could increase costs, strain relationships with suppliers, customers, and regulators, and negatively impact our stock price. Losing the services of our executive officers or other highly qualified and experienced employees, or failing to attract and retain any of such officers or employees, could adversely affect our business.
We have in the past, and may in the future, lose customers or lose a particular product line of a customer due to the highly competitive conditions in the motor vehicle aftermarket industry, consolidation of customers, and customer initiatives to buy direct from foreign suppliers or other business considerations.
We have in the past, and may in the future, lose customers or lose a particular product line of a customer due to competition in the industry, customer consolidation, and customer initiatives to buy direct from our suppliers.
The loss of a significant customer, changes in customer buying behaviors, or a substantial decrease in sales to such a customer could have a material adverse effect on our sales and operating results. In addition, any consolidation among our key customers may further increase our customer concentration risk.
The loss of a significant customer or a substantial reduction in purchases or a change in buying behaviors of a significant customer could have a material adverse effect on our sales and operating results. Customer consolidation may further increase this risk.
New international, federal, or state legislative or regulatory restrictions or standards adopted regarding emissions of carbon dioxide that may be imposed on motor vehicles and related fuels could adversely affect demand for motor vehicles, annual miles driven, or the products we sell and could lead to or require changes in motor vehicle technology or increased costs.
For example, restrictions or standards adopted regarding emissions of carbon dioxide by motor vehicles or fuels could adversely affect demand for motor vehicles, annual miles driven, or the products we sell. Moreover, such restrictions and standards could lead to or require changes in motor vehicle technology and increased product development costs.
In addition, if our products are defective or installed or used incorrectly by customers, bodily injury, property damage, or other injury, including death, may result and could give rise to product liability claims against us. Legal 20 proceedings and claims may be time-consuming and expensive to prosecute, defend, or conduct.
We face legal proceedings and claims arising from normal business activities, including contracts, employment, competition, and intellectual property. In addition, if our products are defective or installed or used incorrectly by customers, bodily injury, property damage, or other injury, including death, may result and could give rise to product liability claims against us.
Because our sales are concentrated, and the industry in which we operate is very competitive, we are under ongoing pressure from our customers to offer lower prices, extend payment terms, increase marketing and transportation allowances, provide enhanced rebates, discounts, rights of return and credits and offer other terms more favorable to these customers.
Because of this customer concentration and intense competition, we often are under pressure from our customers to lower prices, extend payment terms, increase marketing and transportation allowances, provide enhanced rebates, discounts, rights of return and credits, and offer customers other more favorable terms.
If we are not able to protect our proprietary rights or if those rights are invalidated or circumvented, our business may be adversely affected. 16 Our business is dependent, in part, on our ability to innovate, and, as a result, we rely on our intellectual property.
If we are not able to protect our proprietary rights or if those rights are invalidated or circumvented, our business may be adversely affected. Our business depends on protecting our intellectual property and proprietary technologies.
Should any 14 such disruption continue for an extended period, the impact could have a material adverse effect on our business, results of operations, and financial condition. Product Development, Acceptance, Quality, and Regulations If we do not continue to develop new products and bring them to market, our business, financial condition, and results of operations could be materially impacted.
The extent and duration of such disruptions cannot be predicted. Any prolonged impact could materially adversely affect our business, financial condition, and results of operations. Product Development, Acceptance, Quality, and Regulations If we do not continue to develop new products and bring them to market, our business, financial condition, and results of operations could be materially impacted.
Risks Related to Our Business Our Industry, Operations, and Competition Our business is impacted by the age, condition, and number of vehicles that need servicing and by improvements in the quality of new vehicle parts.
Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially affect our business, financial condition, or results of operations. 9 Risks Related to Our Business Our Industry, Operations, and Competition Our business is impacted by the age, condition, and number of vehicles that need servicing and by improvements in the quality of new vehicle parts.
Moreover, our credit agreement is guaranteed by our material domestic subsidiaries and is supported by a security interest in substantially all our and their personal property and assets, subject to certain exceptions. Our failure to comply with our covenants and other obligations under the credit agreement may result in an event of default thereunder.
The credit agreement is guaranteed by our material domestic subsidiaries and secured by substantially all our and their personal property and assets, subject to certain exceptions. Failure to comply with these covenants could trigger a default.
As a result of the magnitude of our foreign sourcing, our business may be subject to various risks, including the following: a. uncertainty caused by the elimination of import quotas and the possible imposition of additional quotas, bans on importing goods or materials from certain countries or regions, or other retaliatory or punitive trade measures; b. imposition of duties, tariffs, taxes, and other charges on imports; c. significant devaluation of the U.S. dollar against foreign currencies; d. restrictions on the transfer of funds to or from foreign countries; e. political instability, military conflict, or terrorism involving the United States or any of the countries where our products are manufactured or sold, which could cause labor shortages, a delay in transportation, or an increase in costs of transportation, labor, raw materials, or finished product or otherwise disrupt our business operations; and f. disease, epidemics, and health-related concerns could result in closed factories, reduced workforces, scarcity of raw materials, and scrutiny and embargoing of goods produced in infected areas.
In 2025, approximately 77% of our total volume of purchases of products was sourced from non-U.S. countries, with approximately 38% sourced from China, exposing us to significant risks, including: • uncertainty caused by import quotas, bans on importing goods or materials from certain countries or regions, or other retaliatory or punitive trade measures; • duties, tariffs, taxes, and other charges on imports; • restrictions on fund transfers to or from foreign countries; • political instability, military conflict, or terrorism involving the United States or any of the countries where our products are manufactured or sold, which could cause labor shortages, a delay in transportation, or an increase in costs of transportation, labor, raw materials, or finished product or otherwise disrupt our business operations; and • epidemics causing factory closures, labor shortages, raw material scarcity, and scrutiny and embargoing of goods produced in infected areas.
A default, if not cured or waived, may permit acceleration of our indebtedness and provide our lenders with the ability to foreclose on the collateral securing their loans .
A default, if not cured or waived, may permit acceleration of our indebtedness and provide our lenders with the ability to foreclose on the collateral securing their loans. If accelerated, we may lack sufficient funds to pay down the indebtedness (together with accrued interest and fees) or we may be unable to refinance on favorable terms, if at all.
Our operating results are sensitive to the availability and cost of third-party logistics providers, which are important in the manufacture and transport of our products. We depend upon third-party logistics providers, such as ocean freight, port operators, railroad, and trucking carriers, for shipments to and from our suppliers and for delivery of our products to us and our customers.
We receive product shipments from our suppliers, and we ship products to our customers. As a result, our operating results depend on the availability and cost of third-party logistics providers, including ocean freight, port operators, railroads, and trucking carriers.
Difficulties encountered with acquisitions could have a material adverse effect on our business, financial condition, and results of operations. 21 Changes in tax laws or exposure to additional income tax liabilities could have a material adverse effect on our business, financial condition, and results of operations.
Changes in tax laws or exposure to additional income tax liabilities could have a material adverse effect on our business, financial condition, and results of operations. We are subject to federal, state, and local income and non-income taxes and face audits in multiple jurisdictions. Tax authorities may challenge our positions and assess additional taxes.
Our operations, revenues, and operating results, as well as the operations of our third-party manufacturers, suppliers, warehouse, distribution and logistics providers, and customers, may be subject to quarter-over-quarter fluctuations and disruptions from a variety of causes outside of our or their control, including work stoppages, market volatility, fuel and transportation prices, acts of war, terrorism, cyber incidents, pandemics, power outages, fires, earthquakes, flooding, changes in weather patterns, weather or seasonal fluctuations or other climate-based changes, including hurricanes or tornadoes, or other natural disasters.
Our operations and those of third-party manufacturers, suppliers, logistics providers, and customers may face quarterly fluctuations and disruptions from factors beyond our control, including work stoppages, market volatility, fuel price changes, acts of war, terrorism, cyber incidents, pandemics, power outages, fires, flooding, severe weather, including hurricanes, tornadoes, and typhoons, and other natural disasters.
If our customers are unable to grow their businesses and compete effectively, it could lead to reduced sales, increased credit risk, and potential loss of business for those customers, which could have a material adverse effect on our business, financial condition, and results of operations . 11 Customer consolidation in the motor vehicle aftermarket industry may lead to customer contract terms less favorable to us, which may negatively impact our financial results.
If our customers cannot grow their businesses or maintain their ability to compete, they may face reduced sales, increased credit risk, and potential loss of business, which, in turn, could have a material adverse effect on our business, financial condition, and results of operations .
Borrowings under our credit agreement are at variable rates of interest and expose us to interest rate risk. If interest rates increase, our debt service obligations on the variable rate indebtedness will increase even though the amount borrowed remains the same. As a result, our net income, and cash flows, including cash available for servicing our indebtedness, will correspondingly decrease.
Interest rate increases may adversely affect our financial condition and results of operations. 16 Borrowings under our credit agreement are at variable interest rates, exposing us to interest rate risk. If rates rise, our debt service costs will increase even though principal remains unchanged, reducing net income and cash flow, including cash available for servicing our indebtedness.
In addition, given the size and scale of some of our customers, there is a risk that they may establish and grow direct relationships with our suppliers or other suppliers in the marketplace and reduce 10 their purchases or cease purchasing from us.
Given the size and scale of some of our 10 customers, their ability to forge direct relationships with our suppliers could cause those customers to reduce their purchases from us or to cease purchasing from us altogether.
We could be adversely affected by violations of the U.S. Foreign Corrupt Practices Act and similar anti- bribery laws around the world. The U.S.
While we strive to meet evolving standards, we cannot guarantee success, market acceptance of our products, or favorable returns on related investments. We could be adversely affected by violations of the U.S. Foreign Corrupt Practices Act and similar anti-bribery and anti-corruption laws around the world. The U.S.
This could have a material adverse effect on our business, financial condition, and results of operations. We are exposed to risks related to accounts receivable sales agreements. We have entered into several customer-sponsored programs administered by unrelated financial institutions that permit us to sell certain accounts receivable at discounted rates to the financial institutions without recourse.
Such circumstances could materially adversely affect our business, financial condition, and results of operations. We are exposed to risks related to customer-sponsored accounts receivable sales agreements. We participate in customer-sponsored programs administered by third-party financial institutions that allow us to sell certain accounts receivable at discounted rates without recourse. These programs accelerate cash collection and reduce non-payment risk.
We extend credit to our customers, some of whom may be unable to pay in the future. We regularly extend credit to our customers. A significant percentage of our accounts receivable have been, and are expected to continue to be, concentrated among a relatively small number of retailers, dealers, and distributors in the United States.
We extend credit to our customers, some of whom may be unable to pay in the future. We regularly extend credit to customers, and a significant portion of our accounts receivable is concentrated among a few large retailers, dealers, and distributors. As of December 31, 2025, our four largest customers represented 78% of total receivables.
These customer demands have put continued pressure on our operating margins and profitability and in the future could have a material adverse effect on our business, financial condition, and results of operations. There is substantial price competition in our industry, and our success and profitability will partially depend on our ability to maintain a competitive cost and price structure .
If and when we meet these customer demands, they adversely impact our operating margins and profitability and could have a material adverse effect on our business, financial condition, and results of operations. Our industry faces intense price competition, and our success depends on maintaining a competitive cost and price structure . Our industry faces intense price competition.
For example, the National Highway Traffic Safety Administration (“NHTSA”) has federal oversight over product safety issues related to automobiles in the United States, and the Consumer Product Safety Commission (“CPSC”) has federal oversight over product safety issues related to off-road vehicles.
For example, the NHTSA has federal oversight over product safety issues related to automobiles in the United States, and the CPSC has federal oversight over product safety issues related to off-road vehicles. Regulatory changes may increase compliance costs or require product redesigns.
The size of the motor vehicle aftermarket industry depends, in part, upon the number of vehicles on the road, average vehicle age, change in total miles driven per year, new or modified environmental and vehicle safety regulations, including fuel-efficiency and emissions reduction standards, pricing of new and used vehicles, and new vehicle quality and related warranties.
The size of the motor vehicle aftermarket industry depends on factors such as the number of vehicles on the road, average vehicle age, change in total miles driven, regulatory changes, pricing of new and used vehicles, vehicle and component quality and warranties and maintenance programs.
The motor vehicle aftermarket industry has been consolidating over the past several years. As a result of such consolidations, many of our non-end user customers have grown larger and therefore have more leverage in negotiating agreements to buy products from us.
Customer consolidation in the motor vehicle aftermarket industry may lead to customer contract terms less favorable to us, which may negatively impact our financial results. The motor vehicle aftermarket industry has been consolidating over the past several years, resulting in some of our customers having grown larger and having more leverage in negotiating agreements to buy products from us.
We operate in parts of the world that are recognized as having governmental and commercial corruption and local customs and practices that can be inconsistent with anti-bribery laws. We cannot assure you that our internal control policies and procedures will always protect us from reckless or criminal acts committed by our employees or third-party intermediaries.
While we mandate that our employees, agents, and suppliers comply with anti-bribery and anticorruption (“ABAC”) laws, operating in regions with corruption risks exposes us to potential violations. We cannot assure you that our internal control policies and procedures will always protect us from reckless or criminal acts committed by our employees or third-party intermediaries.
A significant percentage of our sales has been, and is expected to be, concentrated among a relatively small number of customers. During 2024, two customers each accounted for more than 10% of net sales and in the aggregate accounted for approximately 39% of net sales. We anticipate that this concentration of sales among these customers will continue in the future.
In 2025, two customers each represented more than 10% of net sales and together accounted for approximately 40% of net sales. We anticipate that this concentration of sales among these customers may continue in the future.
While we generally require these third parties to monitor and protect their information technology systems against cyber-attacks and other breaches, their efforts may not be effective.
While we generally require these third parties to monitor and protect their information technology systems against cyber-attacks and other breaches, their efforts may not be effective. Any substantial cyber-attack or data breach could materially adversely affect our business, financial condition, and results of operations. We use AI technologies in our business, and that use exposes us to risk.
Moreover, we utilize third-party vendors that provide information technology services for various areas, including human resources functions (e.g., payroll), and parts of our operations rely upon third-party logistics providers that maintain their own information technology systems on which we rely.
In addition, we rely on third-party vendors that provide information technology services for various functions, such as human resources (e.g., payroll) and operations (e.g., logistics providers), and these vendors maintain their own information technology systems. Breaches in those systems could expose our data, intellectual property, or confidential information, disrupt operations, damage our reputation, and lead to legal claims.
The product returns and customer credits primarily affect our net sales and profit levels while payment term extensions and additional factoring costs generally reduce operating cash flow and require additional capital to finance our business. We expect these trends to continue for the foreseeable future.
Returns and credits reduce net sales and profitability, while longer payment terms and factoring costs reduce operating cash flow and require additional capital to finance our business.
Fluctuations in demand may result from several factors, including, but not limited to, global economic conditions, global pandemics, the age, condition, and number of vehicles that need servicing, motor vehicle parts failure rates, loss of market share, and improvements in product designs that result in enhanced quality and reliability of new vehicle parts .
Demand fluctuations may result from global economic conditions, vehicle age and condition, part failure rates, introductions of new products by competitors, market share changes, and improvements in product quality and reliability.
Claims of intellectual property infringement by original equipment manufacturers and others could adversely affect our business and negatively impact our ability to develop new products. From time to time in the ordinary course of our business, we are subject to claims that we are infringing the intellectual property rights of original equipment manufacturers, competitors, non-practicing entities, or others.
Claims of intellectual property infringement by OEMs and others could adversely affect our business and negatively impact our ability to develop new products. We may face claims of intellectual property infringement from OEMs, competitors, non-practicing entities, or others. Such claims—whether or not they have merit—can increase legal costs, divert employee time, and delay product development or production.
In addition, our business, financial position, results of operations, or cash flows could be materially and adversely affected if we are unable to pass along increased logistics costs to our customers, or if third-party transportation capacity were to decline significantly or otherwise become unavailable. Significant inflation could adversely affect our business and financial results.
If we cannot pass increased costs to customers or if capacity declines significantly, our business, financial condition, and results of operations could be materially adversely affected. Significant inflation could adversely affect our business and financial results. Significant inflation, including rising costs for raw materials, transportation, labor, energy, and financing, may adversely impact our operations and financial performance.
Such concentration of ownership may have the effect of delaying, preventing, or deterring a change in control of the Company, could deprive shareholders of an opportunity to receive a premium for their common stock as part of a sale of the Company, and might ultimately affect the market price of our common stock.
Such 17 concentration may deter or delay a change in control, limit opportunities for shareholders to receive a premium in a sale, and affect the market price of our common stock. Additionally, substantial sales of shares by Mr.
Our products are sold primarily to aftermarket retailers; dealers; national, regional, and local wholesale distributors; professional installers; specialty markets; and salvage yards. The growth of our business depends, in part, on the ability of our customers to grow their businesses and compete effectively in their respective markets.
Our business depends on the ability of our customers, such as retailers, dealers, distributors, installers, and specialty markets, to grow their businesses and compete effectively. If they fail to do so, their demand for our products may decline.
Due to the diversity of our product offering, we compete against a large cross-section of aftermarket companies and brands, including, but not limited to, Cardone Industries, Inc., Standard Motor Products, Inc., Tenneco, Inc., Bosch Auto Parts, First Brands Group, LLC, Gates Corporation, Continental Automotive Systems, Inc.
We compete against a broad range of companies (public and private, large and small) and brands, including, but not limited to, Standard Motor Products, Inc., Tenneco, Inc., TrakMotive, Bosch Auto Parts, Gates Corporation, Continental Automotive Systems, Inc. (VDO), MevoTech LP, ACDelco (owned by General Motors Company), Motorcraft (owned by Ford Motor Company), Cummins Inc.
Adverse changes in economic conditions, including inflation, recession, increases in fuel prices, decreased transportation capacity, rising interest rates, tariffs, labor shortages and unemployment levels, availability of consumer credit, taxation, or instability in the financial markets or credit markets may either lower demand for our products or increase our operational costs, or both.
Adverse economic conditions—such as inflation, recession, rising fuel prices, reduced transportation capacity, higher interest rates, tariffs, labor shortages, unemployment, limited consumer credit, tax changes, or financial market instability—may reduce demand for our products, increase operating costs, or both. These conditions can also materially impact our customers, suppliers, dealers, and other parties with whom we do business.
In addition, an unfavorable ruling in intellectual property litigation could subject us to significant liability, increased legal expense, and require us to cease developing or selling the affected products. Any significant restriction that impedes our ability to develop and commercialize our products could have a material adverse effect on our business, financial condition, and results of operations.
Any significant claim of intellectual property infringement or any restriction imposing an adverse ruling that limits our ability to develop and commercialize products could materially adversely affect our business, financial condition, and results of operations. 15 Failure to maintain the value of our brands could have an adverse effect on our reputation, cause us to incur significant costs, and negatively impact our business.
With our acquisition of SuperATV, a portion of our sales are generated from providing aftermarket parts and accessories for specialty vehicles, such as UTVs and ATVs, that require performance-defining products. Our success depends, in part, on the growth of the market for such vehicles.
Following our acquisition of SuperATV, a portion of our sales comes from aftermarket parts and accessories for specialty vehicles, such as UTVs and ATVs. Success requires continued market expansion, creation of new vehicle classes that benefit from our products, and our ability to develop products for these markets.
If interest rates increase such that the cost of these arrangements becomes more than the cost of servicing our receivables with existing debt, we may not be able to rely on such arrangements, which could have a material adverse effect on our business, financial condition, and results of operations.
A one-point increase in discount rates would have added approximately $11.3 million in factoring costs for 2025. Rising rates increase these costs and reduce accounts receivable collections. If these arrangements become more expensive than servicing receivables with existing debt, we may be unable to rely on them, which could materially adversely affect our business, financial condition, and results of operations.
We have a credit agreement with Bank of America, N.A., as administrative agent, under which we borrowed $500.0 million in the form of a term loan and through which we have a $600.0 million revolving credit facility.
Risks Related to Our Capital Structure and Finances If our financial performance deteriorates or economic conditions adversely change, our ability to service or refinance our indebtedness could negatively affect our financial health. Under our credit agreement with Bank of America, N.A., as administrative agent, we borrowed $500.0 million through a term loan and maintain a $600.0 million revolving credit facility.
There can be no assurance regarding the outcome of current or future legal proceedings, claims, or investigations. The market price of our common stock may be volatile and could expose us to securities class action litigation and increased shareholder activism.
The market price of our common stock may be volatile and could expose us to securities class action litigation and increased shareholder activism. The price of our common stock may fluctuate significantly due to economic conditions, market volatility, and our ability to meet analysts’ expectations. Even minor shortfalls in our performance can negatively impact our stock price.
Preventing unauthorized use or infringement of our intellectual property is inherently difficult. Moreover, it may be difficult or practically impossible to detect theft or unauthorized use of our intellectual property. Any of the foregoing could have a material adverse effect on our business, financial condition, and results of operations.
Moreover, preventing unauthorized use or detecting theft is inherently difficult. If we fail to adequately protect our intellectual property and proprietary technology, it could materially adversely affect our ability to compete and our business, financial condition, and results of operations.
Our accounts receivable sales agreements are variable rate instruments impacted by reference interest rates, such as the Term Secured Overnight Financing Rate ("Term SOFR"), which are components of the discount rate applicable to each arrangement.
For example, a one-point increase in interest rates on outstanding borrowings under our credit agreement would have raised 2025 interest expense by approximately $4.6 million . Our accounts receivable sales agreements also use variable rates tied to benchmarks such as the Term Secured Overnight Financing Rate ("Term SOFR"), which is a component of the discount rate applicable to each arrangement.
Moreover, as a supplier in the motor vehicle aftermarket industry, we face additional challenges in designing and producing replacement products as original equipment manufacturers may design parts that contain enhanced technology features or proprietary technologies that are required to interface with other vehicle systems to work properly.
As a motor vehicle aftermarket supplier, we face additional complexity when OEMs' parts incorporate proprietary technologies that are required to interface with other vehicle systems to work properly. Without having access to those technologies, our ability to create replacement parts may be adversely impacted.
We have experienced, and in the future may experience, reliability, quality, or compatibility problems in products after their production and sale to customers. Product design and quality problems and any associated product recalls could result in damage to our reputation, loss of customers, a decrease in revenue, litigation, unexpected expenses, and a loss of market share.
Design and quality problems with our products could damage our reputation and adversely affect our business. Design or quality issues in our products—including reliability or compatibility problems—could harm our reputation and business. Such issues may lead to product recalls, customer loss, revenue decline, litigation, unexpected costs, and reduced market share.
We generally protect our intellectual property through patents, trademarks, copyrights, trade secrets, confidentiality and nondisclosure agreements, information security practices, and other measures to the extent our budget permits.
Among other things, we use patents, trademarks, copyrights, trade secrets, confidentiality and nondisclosure agreements, information security practices, and other measures to protect our intellectual property and proprietary technologies, but there is no assurance that we will be successful in protecting our rights or preventing misappropriation or circumvention.
Any future changes in the value of the Chinese yuan relative to the U.S. dollar may result in a change in the cost of products that we purchase from China in the future. 19 If these risks limit or prevent us from acquiring products from foreign suppliers or significantly increase the cost of our products, our operations could be seriously disrupted until alternative suppliers are found, which could have a material adverse effect on our business, financial condition, and results of operations.
Any future changes in the value of the Chinese yuan relative to the U.S. dollar may result in a change in the cost of products that we purchase from China in the future.
In addition, any such refinancing, restructuring, or sale of assets might not be available on economically favorable terms or at all, and if prevailing interest rates at the time of any such refinancing or restructuring are higher than our current rates, interest expense related to such refinancing or restructuring would increase.
Such measures might not be sufficient to enable us to service our indebtedness. In addition, our ability to refinance our indebtedness at or prior to maturity, and any restructuring or sale of assets that we may be required to make to service our indebtedness, might not be available on economically favorable terms or at all.
Our credit agreement contains affirmative and negative covenants, including requirements that we maintain specified financial ratios, which limit and restrict our operations and may hamper our ability to engage in activities that may be in our long-term best interests. Events beyond our control could affect our ability to meet these and other covenants under the credit agreement.
If we cannot comply with these covenants, we may be in default under our credit agreement. Our credit agreement includes covenants—such as maintaining specific financial ratios—that restrict operational flexibility and may limit activities aligned with long-term goals. Events beyond our control could affect compliance.
Our growth in the specialty vehicle category depends upon our continued ability to expand our product sales into specialty vehicles, including, but not limited to, those that require performance-defining products, and the expansion of the market for these vehicles.
We expect these trends to continue, which could materially adversely affect our business, financial condition, and results of operations. 11 Our growth in the specialty vehicle category depends upon our continued ability to expand product sales into specialty vehicles and on overall market growth.
Our ability to make payments of principal and interest on our indebtedness depends upon our future performance, which is subject to economic conditions, interest rates, industry cycles, and financial, business, and other factors, many of which are beyond our control.
High levels of indebtedness may require significant cash for principal and interest payments, reducing funds for operations, acquisitions, or stock repurchases, and limiting financial flexibility. Our ability to service our indebtedness depends on future company performance and general economic conditions, many of which are beyond our control.
If we do not enter into these agreements, our financial condition, results of operations, and cash flows could be materially and adversely affected by delays or failures in collecting trade accounts receivables. Interest rate increases may adversely affect our financial condition and results of operations.
Additionally, some customers do not offer such programs, and delays or failures in collecting trade receivables from them could materially and adversely impact our business, financial condition, and results of operations.
Fluctuations in demand for third-party logistics providers and other events impacting transportation capacity and costs, such as strikes, political events, international trade disputes, war, terrorism, natural disasters, adverse weather conditions, congestion, increases in fuel prices, public health issues, including pandemics, and other events, may impact the availability of third-party logistics providers to ship our products or the cost to ship our products.
Access to these providers is not guaranteed, and adverse market conditions or infrastructure disruptions may prevent us from transporting products at competitive rates. Events such as strikes, political instability, trade disputes, war, terrorism, natural disasters, adverse weather, congestion, fuel price increases, and health crises can impact logistics capacity and costs.
Violations of these laws may result in criminal or civil sanctions, which could disrupt our business and result in a material adverse effect on our reputation, business, financial condition, and results of operations.
These events could pressure us to offer customers better pricing or contract terms to retain business or cause us to lose market share, which, in turn, could have a material adverse effect on our business, financial condition, and results of operations.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeIn particular, the Audit Committee reviews with management the Company’s key IT Systems and evaluates the adequacy of the Company’s information security program, compliance, and controls. 23 The Company's Senior Vice President and Chief Information Officer (“CIO”), who reports to the Company’s Chief Executive Officer, is responsible for the operation of the Company’s information security program.
Biggest changeOur Senior Vice President and Chief Information Officer (“CIO”), who reports to our Chief Executive Officer, is responsible for the operation of our information security program. Our CIO is an IT veteran with over 25 years of experience in building and maturing cyber programs for large public companies.
The Company's technology environment is managed by an experienced team of professionals who follow an extensive set of policies and procedures related to data security. Our program further includes review and assessment by external, independent third parties, who assess and report on our internal incident response preparedness and help identify areas for continued focus and improvement.
Our technology environment is managed by an experienced team of professionals who follow an extensive set of policies and procedures related to data security. Our program further includes review and assessment by external, independent third parties, who assess and report on our internal incident response preparedness and help identify areas for continued focus and improvement.
Our information security program includes development, implementation, and improvement of policies and procedures to safeguard information to help ensure availability of critical data and systems.
Our information security program includes the development, implementation, and improvement of policies and procedures to safeguard information and help ensure the availability of critical data and systems.
To the extent we utilize third-party vendors to provide information technology services for various areas, including human resources functions (e.g., payroll), we generally require these vendors to monitor and protect their information technology systems against cyber-attacks and other breaches.
To the extent we utilize third-party vendors to provide information technology services for various areas, such as human resources functions (e.g., payroll), we generally require these vendors to monitor and protect their information technology systems against cyber-attacks and other breaches.
To our knowledge, during 2024, there were no material cybersecurity incidents or threats that materially affected or are reasonably likely to materially affect the Company’s business strategy, results of operations, or financial condition.
To our knowledge, during 2025, there were no material cybersecurity incidents or threats that materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition.
The success of the Company’s information security program relies not only on ownership by the CIO’s organization but also on an active and collaborative relationship within the business. The Company requires all employees to complete cyber training annually. For 2024, the Company maintained a security learning management system with phishing simulations distributed regularly to enhance cyber resiliency.
The success of our information security program relies not only on ownership by the CIO’s organization but also on an active and collaborative relationship within the business. We require all employees to complete cyber training annually. For 2025, the Company maintained a security learning management system with phishing simulations distributed regularly to enhance cyber resiliency.
Additionally, the Company leverages communications, contests, policies, videos, and visuals to continuously raise awareness among employees. 24
Additionally, we leverage communications, contests, policies, videos, and visuals to continuously raise awareness among employees.
Our core IT Systems consist mostly of purchased and licensed software programs that integrate together and with our internally developed solutions. As part of our risk management program, we monitor and assess the risks posed by cybersecurity threats to those internal and external systems and solutions and maintain an information security program designed to mitigate such risks.
As part of our risk management program, we monitor and assess the risks posed by cybersecurity threats to those internal and external systems and solutions and maintain an information security program designed to mitigate such risks.
Governance Pursuant to its charter, the Audit Committee of the Board of Directors (the “Board”) has oversight of the Company's information security program, including, but not limited to, risks regarding cybersecurity threats.
Governance Pursuant to its charter, the Audit Committee of our Board of Directors (the “Board”) has oversight of the Company's information security program, including, but not limited to, risks regarding cybersecurity threats. In particular, the Audit Committee reviews with management the Company’s key IT Systems and evaluates the adequacy of the Company’s information security program, compliance, and controls.
The Security Committee oversees the Company’s security roadmap and ensures the monitoring of information security policies and procedures covering areas such as back-up and retention, acceptable use, disaster recovery, incident management, and passwords.
These reviews typically include the number of events, the number of investigations, the mean response time, and cyber trends. The Security Committee oversees our security roadmap and ensures the monitoring of information security policies and procedures covering areas such as back-up and retention, acceptable use, disaster recovery, incident management, and passwords.
With the assistance of one such reputable third party, the Company conducts biannual maturity assessments of its IT Systems against the National Institute of Standards of Technology (NIST) Cybersecurity Framework. We also carry insurance that provides protection against the risks from cybersecurity threats.
With the assistance of one such reputable third party, we conduct biannual maturity assessments of our IT Systems against the National Institute of Standards of Technology ("NIST") Cybersecurity Framework. We also maintain insurance to mitigate the financial impact of cybersecurity events.
ITEM 1C. Cybersecurity Risk Assessment We depend on a variety of information systems and technologies (including cloud technologies) (collectively, “IT Systems”) to manage our business. We rely on these IT Systems to provide information for substantially all of our business operations, including supply chain, order processing, e-commerce, human resources, legal, compliance, marketing, finance, and accounting.
ITEM 1C. Cybersecurity Risk Assessment We depend on a variety of information systems and technologies (including the Internet, cloud technologies, and AI) (collectively, “IT Systems”) to manage our business.
Our CIO is an IT veteran with over 25 years of experience in building and maturing cyber programs for large public companies. The CIO is supported by an internal team of certified security analysts who work in conjunction with leading security operations managed service providers to manage detection and response.
The CIO is supported by an internal team of certified security analysts who work in conjunction with leading security operations managed service providers to manage detection and response. 20 At least annually, we present a cyber risk report that highlights program governance, risks, and opportunities to our Board.
On at least an annual basis, a cyber risk report that highlights program governance, risks, and opportunities is provided to the Audit Committee and the full Board. The Company maintains a Security Committee, which is led by the CIO and is comprised of individuals from the Company’s IT department – including dedicated security team members with various security certifications.
We maintain a Security Committee, which is led by the CIO and is comprised of individuals from our IT department, including dedicated security team members with various security certifications. The Security Committee regularly reviews information security program governance and key performance indicators.
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The Security Committee regularly reviews information security program governance and key performance indicators. These reviews typically include the number of events, number of investigations, mean response time, and cyber trends.
Added
We rely on these IT Systems for substantially all of our business operations, including supply chain, order processing, e-commerce, product development, human resources, legal, compliance, marketing, finance, accounting, and other business activities. Our core IT Systems consist mostly of purchased and licensed software programs that integrate together and with our internally developed solutions.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeUnder the three lease agreements, we paid an aggregate rent of $2.8 million in 2024. The rent payable under each lease will increase by 2% on October 4 th of each year. Each of the three leases commenced in October 2022 in connection with the SuperATV acquisition and will expire on October 4, 2027.
Biggest changeLindsay Hunt, our former President, Specialty Vehicles, and members of her family are owners. Under the three lease agreements, we paid an aggregate rent of $2.8 million in 2025. The rent payable under each lease 21 will increase by 2% on October 4 th of each year.
Leased Durant, OK Warehouse and office 208,000 sq. ft. Owned Lewisberry, PA Warehouse and office 170,500 sq. ft. Leased (2) Madison, IN Warehouse 145,000 sq. ft. Leased (1) Las Vegas, NV Warehouse and office 122,071 sq. ft. Leased Jiangsu Province, China Warehouse and office 105,911 sq. ft. Leased Harrisburg, PA Warehouse and office 101,750 sq. ft.
Leased Durant, OK Warehouse, manufacturing, and office 208,000 sq. ft. Owned Lewisberry, PA Warehouse, manufacturing, and office 170,500 sq. ft. Leased (2) Madison, IN Warehouse 145,000 sq. ft. Leased (1) Las Vegas, NV Warehouse and office 122,071 sq. ft. Leased Jiangsu Province, China Warehouse, manufacturing, and office 105,911 sq. ft. Leased Harrisburg, PA Warehouse and office 101,750 sq. ft.
Leased Whiteland, IN Warehouse and office 827,180 sq. ft. Leased Warsaw, KY Warehouse and office 710,500 sq. ft. Owned Shepherdsville, KY Warehouse 436,716 sq. ft. Leased Colmar, PA Corporate headquarters Warehouse and office 342,000 sq. ft. Leased Madison, IN Warehouse and office 333,000 sq. ft. Leased (1) Shiremanstown, PA Warehouse and office 318,872 sq. ft.
Leased Whiteland, IN Warehouse and office 827,180 sq. ft. Leased Warsaw, KY Warehouse and office 710,500 sq. ft. Owned Shepherdsville, KY Warehouse 436,716 sq. ft. Leased Colmar, PA Corporate headquarters Warehouse and office 342,000 sq. ft. Leased Madison, IN Warehouse, manufacturing, and office 333,000 sq. ft. Leased (1) Shiremanstown, PA Warehouse and office 318,872 sq. ft.
ITEM 2. Properties. Facilities As of December 31, 2024, we had 38 warehouse and office facilities located throughout the United States, Canada, China, Taiwan, and India. Five of these facilities are owned and the remainder are leased. Our principal facilities are as follows: Location Description Size Ownership Portland, TN Warehouse and office 997,310 sq. ft.
ITEM 2. Properties Facilities As of December 31, 2025, we had 38 warehouse and office facilities located throughout the United States, Canada, China, Taiwan, and India. Five of these facilities are owned and the remainder are leased. Our principal facilities are as follows: Location Description Size Ownership Portland, TN Warehouse and office 1,309,310 sq. ft.
The rent payable will be increased by 3% on July 1 st of each year. This lease commenced in September 2020 and will expire on December 31, 2027.
Under this lease agreement, we paid rent of $0.7 million in 2025. The rent payable will be increased by 3% on July 1 st of each year. This lease commenced in September 2020 and will expire on December 31, 2027.
Leased Harrisburg, PA Manufacturing Facility 101,132 sq. ft. Owned Lewisville, TX Warehouse and office 101,029 sq. ft. Leased Virginia Beach, VA Warehouse and office 101,000 sq. ft. Leased Warsaw, KY Warehouse 80,000 sq. ft. Leased Shreveport, LA Warehouse and office 65,000 sq. ft. Leased (1) Reno, NV Warehouse and office 54,354 sq. ft.
Leased Harrisburg, PA Manufacturing Facility 101,132 sq. ft. Owned Lewisville, TX Warehouse and office 101,029 sq. ft. Leased Virginia Beach, VA Warehouse, manufacturing, and office 101,000 sq. ft. Leased Mississauga, ON Warehouse 82,830 sq. ft. Leased Warsaw, KY Warehouse 80,000 sq. ft. Leased Shreveport, LA Warehouse and office 65,000 sq. ft.
Leased Kankakee, IL Manufacturing Facility 53,574 sq. ft. Owned (1) We lease two facilities in Madison and one facility in Shreveport (consisting of an aggregate of approximately 543,000 square feet) from limited liability companies in which Ms. Lindsay Hunt, our President, Specialty Vehicles, and members of her family are owners.
Leased (1) Reno, NV Warehouse, manufacturing, and office 54,354 sq. ft. Leased Kankakee, IL Manufacturing Facility 53,574 sq. ft. Owned (1) We lease two facilities in Madison, Indiana, and one facility in Shreveport, Louisiana (consisting of an aggregate of approximately 543,000 square feet) from limited liability companies in which Ms.
(2) We lease one of our two Lewisberry facilities (consisting of approximately 142,500 square feet) from a limited liability company of which our Non-Executive Chairman, Steven L. Berman, and certain of his family members are owners. Under this lease agreement, we paid rent of $0.7 million in 2024.
Each of the three leases commenced in October 2022 in connection with the SuperATV acquisition and will expire on October 4, 2027. (2) We lease one of our two Lewisberry, Pennsylvania facilities (consisting of approximately 142,500 square feet) from a limited liability company of which our Non-Executive Chairman, Steven L. Berman, and certain of his family members are owners.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeITEM 3. Legal Proceedings. The information set forth under the heading “Other Contingencies” appearing in Note 11, “Commitments and Contingencies,” to the Notes to Consolidated Financial Statements contained in PART II, ITEM 8 of this report is incorporated herein by reference. ITEM 4. Mine Safety Disclosures. Not Applicable 25
Biggest changeITEM 3. Legal Proceedings. The information set forth under the heading “Other Contingencies” appearing in Note 10, “Commitments and Contingencies,” to the Notes to Consolidated Financial Statements contained in PART II, ITEM 8 of this report is incorporated herein by reference. ITEM 4. Mine Safety Disclosures. Not Applicable

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeBraun 51 Senior Vice President, General Counsel and Secretary Jeffrey L. Darby 57 Senior Vice President, Sales and Marketing David M. Hession 56 Senior Vice President, Chief Financial Officer and Treasurer Lindsay Hunt 39 President and Chief Executive Officer, Specialty Vehicles Scott D. Leff 53 Senior Vice President, Chief Human Resources Officer Donna M.
Biggest changeBowen 57 Vice President, Chief Accounting Officer Joseph P. Braun 52 Senior Vice President, General Counsel and Secretary David M. Hession 57 Senior Vice President and Chief Financial Officer Scott D. Leff 54 Senior Vice President, Chief Human Resources Officer Donna M. Long 58 Senior Vice President, Chief Information Officer Eric B. Luftig 52 President, Light Duty Kathleen M.
Leff held a variety of global divisional human resources roles at HP Inc. and its subsequent spin‐off, Hewlett‐Packard Enterprise Company, both multinational information technology companies. He served as Chief Human Resources Officer of Hewlett‐Packard Financial Services from March 2010 to March 2018 and Vice President of HPE Pointnext from March 2018 to April 2019. Prior to that, Mr.
Prior to joining Dorman, Mr. Leff held a variety of global divisional human resources roles at HP Inc. and its subsequent spin‐off, Hewlett‐Packard Enterprise Company, both multinational information technology companies. He served as Chief Human Resources Officer of Hewlett‐Packard Financial Services from March 2010 to March 2018 and Vice President of HPE Pointnext from March 2018 to April 2019.
Luftig served in various engineering, sales and marketing roles for publicly and privately held companies, including General Electric, a leader in the power, renewable energy, aviation and healthcare industries, and Nordson Corporation, a designer and manufacturer of dispensing equipment for consumer and industrial adhesives, sealants and coatings. John R.
Luftig served in various engineering, sales, and marketing roles for publicly and privately held companies, including General Electric, a leader in the power, renewable energy, aviation and healthcare industries, and Nordson Corporation, a designer and manufacturer of dispensing equipment for consumer and industrial adhesives, sealants and coatings. Kathleen M.
Borradaile worked in the automotive, technology, and industrial manufacturing industries, including positions at Aptiv Plc (formerly Delphi Automotive Plc), a leading global technology and mobility architecture company primarily serving the automotive sector, TE Connectivity Ltd., a publicly traded global industrial technology leader, and various private equity companies. Joseph P.
Borradaile worked in the automotive, technology, and industrial manufacturing industries, including positions at Aptiv Plc (formerly Delphi Automotive Plc), a leading global technology and mobility architecture company primarily serving the automotive sector, TE Connectivity Ltd., a publicly traded global industrial technology leader, and various private equity companies. Gregory C.
Hession was Vice President, Chief Financial Officer of Johnsonville, LLC, a privately held manufacturer of sausage and other protein products, from May 2013 to January 2019. Prior to that time, Mr.
Hession was also appointed Treasurer in May 2019. Mr. Hession was Vice President, Chief Financial Officer of Johnsonville, LLC, a privately held manufacturer of sausage and other protein products, from May 2013 to January 2019. Prior to that time, Mr.
Prior to July 2014, Ms. Long held roles of increasing responsibility within Unisource, including as its Chief Information Officer, and she previously was a Manager at Accenture plc, a professional services company. Eric B. Luftig joined the Company in December 2021 as Senior Vice President, Product.
Long held roles of increasing responsibility within Unisource, including as its Chief Information Officer, and she previously was a Manager at Accenture plc, a professional services company. 23 Eric B. Luftig joined the Company in December 2021 as Senior Vice President, Product, and was appointed President, Light Duty, in January 2026.
Leff held chief human resources officer roles and divisional human resource and employee relations roles within various publicly and privately held companies. Mr. Leff began his career as a lawyer in a New Jersey County Prosecutor’s office and a New Jersey-based law firm. Donna M. Long joined the Company in April 2015 as Senior Vice President, Chief Information Officer.
Prior to that, Mr. Leff held chief human resources officer roles and divisional human resource and employee relations roles within various publicly and privately held companies. Mr. Leff began his career as a lawyer in a New Jersey County Prosecutor’s office and a New Jersey-based law firm. Donna M.
ITEM 4.1. Information about Our Executive Officers. The following table sets forth certain information with respect to our executive officers as of February 27, 2025: Name Age Position with the Company Kevin M. Olsen 53 President and Chief Executive Officer Brian J. Borradaile 47 Senior Vice President, Strategy and Corporate Development Joseph P.
ITEM 4.1. Information about Our Executive Officers. The following table sets forth certain information with respect to our executive officers as of February 27, 2026: Name Age Position with the Company Kevin M. Olsen 54 President and Chief Executive Officer Steven A. Bashir 42 President, Heavy Duty Brian J. Borradaile 48 Senior Vice President, Strategy and Corporate Development Gregory C.
Hession also previously held positions with Tradeout, Inc., a business-to-business Internet exchange for surplus inventory and fixed assets, and Xylum Corporation, a development stage medical device manufacturer, and he performed management consulting work for Ernst & Young, LLP and Peterson Consulting LP. Lindsay B.
Hession also previously held positions with Tradeout, Inc., a business-to-business Internet exchange for surplus inventory and fixed assets, and Xylum Corporation, a development stage medical device manufacturer, and he performed management consulting work for Ernst & Young, LLP and Peterson Consulting LP. Scott D. Leff joined the Company in April 2019 as Senior Vice President, Chief Human Resources Officer.
Prior to joining the Company, she served as Chief Information Officer of Veritiv Corporation, a business-to-business provider of packaging, publishing, and hygiene products (“Veritiv”), from July 2014 to April 2015. Veritiv was formed as a result of the merger of Unisource Worldwide, Inc., a distributor of printing paper, packaging and supplies (“Unisource”) with xpedx, a division of International Paper Co.
Veritiv was formed as a result of the merger of Unisource Worldwide, Inc., a distributor of printing paper, packaging and supplies (“Unisource”) with xpedx, a division of International Paper Co. Prior to July 2014, Ms.
Olsen is also a director of Twin Disc, Inc., a publicly traded international manufacturer and worldwide distributor of heavy-duty off-highway and marine power transmission equipment and related products. Brian J. Borradaile was appointed to serve as the Company’s Senior Vice President, Strategy and Corporate Development in February 2023. Mr.
Olsen is also a director of Twin Disc, Inc., a publicly traded international manufacturer and worldwide distributor of heavy-duty off-highway and marine power transmission equipment and related products. Steven A. Bashir joined the Company in December 2025 as President, Heavy Duty.
Braun began his legal career in private practice at various law firms, where he advised public and private companies on mergers and acquisitions and securities and corporate governance matters. Jeffrey L. Darby joined the Company in November 1998 as a National Account Manager. He became Senior Vice President, Sales and Marketing in February 2011.
Braun began his legal career in private practice at various law firms, where he advised public and private companies on mergers and acquisitions, securities, and corporate governance matters. David M. Hession joined the Company in February 2019 and was appointed to serve as the Company’s Senior Vice President and Chief Financial Officer effective March 2019. Mr.
Hession joined the Company in February 2019 and was appointed to serve as the Company’s Senior Vice President and Chief Financial Officer effective March 2019. Mr. Hession was also appointed Treasurer in May 2019. Mr.
Bowen was appointed to serve as the Company’s Vice President, Chief Accounting Officer in May 2025 after serving as the Company’s Vice President, Corporate Controller since joining the Company in August 2020. Mr.
McKnight joined the Company in November 2019 as Senior Vice President, Operations and on March 10, 2023, Mr. McKnight was appointed President, Heavy Duty.
Porter joined the Company as its Senior Vice President, Chief Operations Officer for the Company’s Light Duty and Heavy Duty segments in January 2026. Beginning June 2024 and until he joined the Company, Mr.
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Long 57 Senior Vice President, Chief Information Officer Eric B. Luftig 51 Senior Vice President, Product John R. McKnight 56 President, Heavy Duty Tayfun Uner 52 President, Light Duty Kevin M. Olsen joined the Company in July 2016 as Senior Vice President and Chief Financial Officer.
Added
Pacheco 45 President, Specialty Vehicle Nathan J. Porter 50 Senior Vice President, Chief Operations Officer Charles W. Rayfield 46 Senior Vice President, Chief Financial Officer Designate, and Treasurer Kevin M. Olsen joined the Company in July 2016 as Senior Vice President and Chief Financial Officer.
Removed
He previously held the positions of Group Vice President from 2008 to 2010 and Vice President of Sales – Traditional and Key Accounts from 2006 to 2008. Prior to joining the Company, Mr. Darby worked for Federal-Mogul Corporation/Moog Automotive, an automotive parts supplier, beginning in 1990 and held positions in sales and marketing management. 26 David M.
Added
Prior to joining the Company, he worked for ZF Group, a technology manufacturing company that supplies systems for passenger cars, commercial vehicles, and industrial technology, where he served as Head of Sales U.S. and Canada, from August 2025 to December 2025, and where he previously served as Head of CV Aftermarket, beginning in 22 August 2023. Prior to that, Mr.
Removed
Hunt joined the Company in October 2022 as President and Chief Executive Officer, Specialty Vehicles, in connection with the Company’s acquisition of Super ATV, LLC, a leading supplier to the powersports aftermarket (“SuperATV”). Ms. Hunt most recently served as President and Chief Executive Officer of SuperATV, a role that she held beginning in April 2021. Prior to that time, Ms.
Added
Bashir held roles of increasing responsibility with DRiV Incorporated, a leading designer, manufacturer and marketer of automotive products for aftermarket customers, beginning in September 2016, most recently serving as its Business Line Leader and General Manager, Braking. Brian J. Borradaile was appointed to serve as the Company’s Senior Vice President, Strategy and Corporate Development in February 2023. Mr.
Removed
Hunt served SuperATV in roles of increasing responsibility, including leadership positions in sales and marketing, new product development and operations. Ms. Hunt joined SuperATV in 2009. Scott D. Leff joined the Company in April 2019 as Senior Vice President, Chief Human Resources Officer. Prior to joining Dorman, Mr.
Added
Bowen joined the Company after serving as Senior Vice President and Chief Accounting Officer of CIRCOR International, Inc., a provider of products and services for the Industrial and Aerospace & Defense markets, since September 2019. Mr. Bowen began his career at Ernst & Young LLP and is a Certified Public Accountant. Joseph P.
Removed
Prior to joining the Company, he served as Chief Operating Officer of Morgan Corporation, a leading producer of truck and van bodies in North America, from January 2019 to September 2019, and as Chief Operating Officer of Consolidated Glass Holdings, Inc., a holding company for architectural, security, and custom glass and metal fabrication businesses, from September 2017 to July 2018.
Added
Long joined the Company in April 2015 as Senior Vice President, Chief Information Officer. Prior to joining the Company, she served as Chief Information Officer of Veritiv Corporation, a business-to-business provider of packaging, publishing, and hygiene products (“Veritiv”), from July 2014 to April 2015.
Removed
Prior to September 2017, Mr. McKnight held various roles with the Colfax Corporation, a diversified global manufacturing and engineering company (“Colfax”), including most recently as Executive Director of its Howden Industrial Fans division.
Added
Pacheco joined the Company in September 2024 as Chief Operating Officer, Specialty Vehicles. Ms. Pacheco was appointed President, Specialty Vehicle, effective May 2025. Ms.
Removed
Before Colfax, he held various leadership roles with Danaher, a designer, manufacturer, and marketer of professional, medical, industrial, and commercial products and services. 27 Tayfun Uner joined the Company in January 2025 as President, Light Duty.
Added
Pacheco previously held senior management positions with Tenneco Inc., a provider of products for motor vehicle original equipment and aftermarket customers from 2014 to 2024, most recently as Vice President, General Manager, Noise Vibration Harshness, Performance Materials. Prior to her time at Tenneco Inc., she held various roles within Johnson Controls. Nathan J.
Removed
Prior to joining the Company, he served as Senior Vice President of three business units of Newell Brands Inc., a global consumer goods company, from 2018 to 2024.
Added
Porter served as Senior Vice President, Chief Operations Officer, of ADI Global Distribution ("ADI"), a business segment of Resideo Technologies Inc. and a global wholesale distributor of low-voltage products, including security and audio-visual solutions. Prior to its acquisition by ADI, Mr.
Removed
Prior to that, he served as the General Manager for Carlsberg Group, a worldwide brewery group, from 2012 to 2017, and prior to that as its Vice President, Group Strategy from 2008 to 2012. Prior to that time, Mr.
Added
Porter held roles of increasing responsibility at Snap One, LLC, then a publicly traded provider of smart-living products, services, and software to professional integrators, most recently as its Executive Vice President of Operations/Head of Supply Chain from January 2022 to June 2024, and as its Senior Vice President of Operations, from January 2020 to January 2022. Charles W.
Removed
Uner also held strategic positions with increasing responsibility at McKinsey & Company, a global management consulting firm, and The Procter & Gamble Company, a worldwide consumer goods company. 28 PART II
Added
Rayfield joined the Company as its Senior Vice President, Chief Financial Officer Designate, and Treasurer in January 2026. Most recently, he served as Chief Financial Officer of Lutron Electronics Corporation, a leading designer and manufacturer of lighting control and shading systems, lighting fixtures, and accessories for residential and commercial applications, since June 2023. Prior to that, Mr.
Added
Rayfield provided independent financial advisory services from November 2022 to June 2023, and he served as Chief Financial Officer of Knoll Inc., then a publicly traded company and a leading global manufacturer of commercial and residential furniture, accessories, lighting and coverings, from August 2017 to July 2021. 24 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

6 edited+0 added−3 removed5 unchanged
Biggest changeSecurities and Exchange Commission, except as shall be expressly set forth by specific reference in such a filing. 29 Stock Repurchases During the three months ended December 31, 2024, we purchased shares of our common stock as follows: Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (3) Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs (3) September 29, 2024 through October 26, 2024 — $ — — $ 134,565,161 October 27, 2024 through November 23, 2024 (1) 4,808 $ 124.13 — $ 134,565,161 November 24, 2024 through December 31, 2024 (2) 2,235 $ 129.89 — $ 134,565,161 Total 7,043 — $ 134,565,161 (1) Includes 4,808 shares purchased from the Dorman Products, Inc. 401(k) Plan and Trust (as described in Note 12, "Capital Stock", to the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K, the “401(k) Plan”).
Biggest changeSecurities and Exchange Commission, except as shall be expressly set forth by specific reference in such a filing. 25 Stock Repurchases During the three months ended December 31, 2025, we purchased shares of our common stock as follows: Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2) Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs (2) September 28, 2025, through October 25, 2025 — $ — — $ 484,700,192 October 26, 2025, through November 22, 2025 26,000 $ 129.40 26,000 $ 481,335,850 November 23, 2025, through December 31, 2025 (1) 174,137 $ 128.21 171,411 $ 459,364,047 Total 200,137 197,411 $ 459,364,047 (1) Includes 2,726 shares purchased from the Dorman Products, Inc. 401(k) Plan and Trust (as described in Note 12, "Capital Stock", to the Notes to Consolidated Financial Statements included under ITEM 8 of this Annual Report on Form 10-K).
The graph assumes $100 was invested on December 28, 2019 in our common stock and each of the indices, and that dividends were reinvested when and as paid. In calculating the cumulative total shareholder returns, the companies included are weighted according to the stock market capitalization of such companies.
The graph assumes $100 was invested on December 26, 2020, in our common stock and each of the indices, and that dividends were reinvested when and as paid. In calculating the cumulative total shareholder returns, the companies included are weighted according to the stock market capitalization of such companies.
The NASDAQ US Benchmark Auto Parts index is comprised of 21 public companies and the information was furnished by Zacks Investment Research, Inc. The NASDAQ Composite Market Index is comprised of more than 3,200 public companies and the information was furnished by Zacks Investment Research, Inc.
The Nasdaq US Benchmark Auto Parts index is comprised of 24 public companies, and the information was furnished by Zacks Investment Research, Inc. The Nasdaq Composite Market Index is comprised of more than 3,300 public companies, and the information was furnished by Zacks Investment Research, Inc.
ITEM 5. Market for Registrant's Common Equity, Related Shareholder Matters, and Issuer Purchases of Equity Securities. Our shares of common stock are traded publicly on the NASDAQ Global Select Market under the ticker symbol “DORM.” At February 24, 2025, there were 288 holders of record of our common stock.
ITEM 5. Market for Registrant's Common Equity, Related Shareholder Matters, and Issuer Purchases of Equity Securities. Our shares of common stock are traded publicly on the Nasdaq Stock Market LLC under the ticker symbol “DORM.” At February 24, 2026, there were 321 holders of record of our common stock.
Below is a line graph comparing the cumulative total shareholder return for our common stock with the cumulative total shareholder return for the NASDAQ US Benchmark Auto Parts index and the NASDAQ Composite Market Index for the period from December 28, 2019 to December 31, 2024.
Below is a line graph comparing the cumulative total shareholder return for our common stock with the cumulative total shareholder return for the Nasdaq US Benchmark Auto Parts index and the Nasdaq Composite Market Index for the period from December 26, 2020, to December 31, 2025.
In October 2024, the Company’s Board of Directors authorized the purchase of up to $500 million of our common stock under a new share repurchase program effective as of January 1, 2025 through December 31, 2027 (the “New Program”). ITEM 6. [Reserved] 30
(2) In October 2024, the Company’s Board authorized the purchase of up to $500 million of our common stock under a share repurchase program effective from January 1, 2025, through December 31, 2027. At December 31, 2025, $459.4 million was available for repurchase under the program. ITEM 6. [Reserved] 26
Removed
(2) I ncludes 2,235 shares purchased from the 401(k) Plan. (3) On December 12, 2013 we announced that our Board of Directors authorized a share repurchase program, authorizing the repurchase of up to $10 million of our outstanding common stock by the end of 2014.
Removed
Through several actions taken since that time, our Board of Directors expanded the program to $600 million and extended the program through December 31, 2024 (the “Existing Program”). At December 31, 2024, $134.6 million was available for repurchase under the Existing Program.
Removed
The Existing Program expired on December 31, 2024, along with all amounts that remained available for use under the Existing Program as of that date.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

69 edited+26 added−16 removed34 unchanged
Biggest changeResults of Operations The following table sets forth, for the periods indicated, the dollar value and percentage of net sales represented by certain items in our Consolidated Statements of Operations: For the Year Ended December 31, (in thousands, except percentage data) 2024 2023 Net sales $ 2,009,197 100.0 % $ 1,929,788 100.0 % Cost of goods sold 1,202,838 59.9 % 1,244,365 64.5 % Gross profit 806,359 40.1 % 685,423 35.5 % Selling, general and administrative expenses 513,450 25.6 % 470,663 24.4 % Income from operations 292,909 14.6 % 214,760 11.1 % Interest expense, net 39,727 2.0 % 48,061 2.5 % Other income, net 3,070 0.2 % 1,804 0.1 % Income before income taxes 256,252 12.8 % 168,503 8.7 % Provision for income taxes 66,248 3.3 % 39,244 2.0 % Net income $ 190,004 9.5 % $ 129,259 6.7 % * Percentage of sales information may not add due to rounding Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 Net sales increased $79.4 million, or 4.1%, for the year ended December 31, 2024 compared to the prior year, driven primarily by volume, including from new product introductions.
Biggest changeResults of Operations The following table sets forth, for the periods indicated, the dollar value and percentage of net sales represented by certain items in our Consolidated Statements of Operations: For the Year Ended December 31, (in thousands, except percentage data) 2025 2024 Net sales $ 2,130,319 100.0 % $ 2,009,197 100.0 % Cost of goods sold 1,232,582 57.9 % 1,202,838 59.9 % Gross profit 897,737 42.1 % 806,359 40.1 % Selling, general, and administrative expenses 541,484 25.4 % 513,450 25.6 % Goodwill impairment charge 56,706 2.7 % — — % Income from operations 299,547 14.1 % 292,909 14.6 % Interest expense, net 28,575 1.3 % 39,727 2.0 % Other income, net 4,473 0.2 % 3,070 0.2 % Income before income taxes 275,445 12.9 % 256,252 12.8 % Provision for income taxes 71,251 3.3 % 66,248 3.3 % Net income $ 204,194 9.6 % $ 190,004 9.5 % * Percentage of sales information may not add due to rounding Year Ended December 31, 2025, Compared to Year Ended December 31, 2024 Net sales increased $121.1 million, or 6.0%, for the year ended December 31, 2025, compared to the prior year, driven by tariff-related pricing actions in our Light Duty and Heavy Duty segments, increased customer demand in the first half of the year, and sales of new products, partially offset by reduced demand impacted by soft market conditions in the heavy duty and specialty vehicle sectors.
Our complex electronics products are designed and developed in-house and tested to help ensure consistent performance, and our product portfolio is focused on further developing our leadership position in this category. Another area of focus has been on products we market for the heavy-duty sector.
Our complex electronics products are designed and developed in-house and tested to help ensure consistent performance. Our product portfolio is focused on further developing our leadership position in this category. Another area of focus has been on products we market for the heavy-duty sector.
Impact of Labor Market and Inflationary Costs We experienced broad-based inflationary impacts during the year ended December 31, 2023, due primarily to global transportation and logistics constraints, which resulted in significantly higher transportation costs; tariffs; material costs; and wage inflation from an increasingly competitive labor market.
Impact of Inflationary Costs We experienced broad-based inflationary impacts during the year ended December 31, 2023, due primarily to global transportation and logistics constraints, which resulted in significantly higher transportation costs, tariffs and material costs, and wage inflation from an increasingly competitive labor market.
The 7-to-14-year-old vehicle car parc has continued to grow over the past several years, which we expect will expand demand for aftermarket replacement parts as more vehicles remain in operation. 32 In addition, we believe that vehicle owners generally are operating their current vehicles longer than they did several years ago, performing necessary repairs and maintenance to keep those vehicles well maintained.
The 7-to-14-year-old vehicle car parc has continued to grow over the past several years, which we expect will expand demand for aftermarket replacement parts as more vehicles remain in operation. In addition, we believe that vehicle owners generally are operating their current vehicles longer than they did several years ago, performing necessary repairs and maintenance to keep those vehicles well-maintained.
These incentives can be in the form of “off-invoice” discounts that are immediately deducted from sales at the time of sale. For those customers that choose to receive their incentives on a quarterly or annual basis instead of “off-invoice,” we provide rebates and accrue for such incentives as the related sales are made and reduce sales accordingly.
These incentives can be in the form of “off-invoice” discounts that are immediately deducted from sales at the time of sale. For those customers who choose to receive their incentives on a quarterly or annual basis instead of “off-invoice,” we provide rebates and accrue for such incentives as the related sales are made, and reduce sales accordingly.
Additionally, our outstanding borrowings under our credit facility bear interest at variable rates tied to Term SOFR or the applicable base rate. Under the terms of the credit facility, a change in interest rates affects the rate at which we can borrow funds thereunder and also impacts the interest cost on existing borrowings.
Additionally, our outstanding borrowings under our credit facility bear interest at variable rates tied to Term SOFR or the applicable base rate. Under the terms of the credit facility, a change in interest rates affects the rate at which we can borrow funds thereunder and impacts the interest cost on existing borrowings.
We also lease our facilities in Madison, IN, and Shreveport, LA, from entities in which Lindsay Hunt, our President, Specialty Vehicle, and certain of her family members are owners.
We also lease our facilities in Madison, IN, and Shreveport, LA, from entities in which Lindsay Hunt, our former President, Specialty Vehicle, and certain of her family members are owners.
However, our liquidity could be negatively affected by extending payment terms to customers, a decrease in demand for our products, higher interest rates, the outcome of contingencies, or other factors. See Note 11, “Commitments and Contingencies”, to the Consolidated Financial Statements, included under ITEM 8, for additional information regarding commitments and contingencies that may affect our liquidity.
However, our liquidity could be negatively affected by extending payment terms to customers, a decrease in demand for our products, higher interest rates, the outcome of contingencies, or other factors. See Note 10, “Commitments and Contingencies”, to the Consolidated Financial Statements, included under ITEM 8, for additional information regarding commitments and contingencies that may affect our liquidity.
According to data from the Auto Care Association (“Auto Care”), the US SAAR experienced a decline from 2008 to 2011 as consumers purchased fewer new vehicles as a result of the Great Recession of 2008. We believe that the declining US SAAR during that period resulted in a follow-on decline in our primary VIO subsegment (7-to-14-year-old vehicles) commencing in 2016.
According to data from the Auto Care Association (“Auto Care”), the US SAAR experienced a decline from 2008 to 2011 as consumers purchased fewer new vehicles as a result of the Great Recession of 2008. We believe that the declining US SAAR during that period led to a follow-on decline in our primary VIO subsegment (7-to-14-year-old vehicles) commencing in 2016.
We generate most of our net sales from customers in North America, primarily in the United States. Our products are sold primarily through aftermarket retailers, including through their online platforms; dealers; national, regional, and local warehouse distributors and specialty markets; and salvage yards.
We generate most of our net sales from customers in North America, primarily in the United States. Our products are sold primarily through aftermarket retailers, including their online platforms; dealers; and national, regional, and local warehouse distributors and specialty markets.
ITEM 7. Management's Discussion and Analysis of Financial Condition and Results of Operations. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” should be read in conjunction with the Consolidated Financial Statements and related notes thereto included in PART II, ITEM 8 of this Annual Report on Form 10-K.
ITEM 7. Management's Discussion and Analysis of Financial Condition and Results of Operations. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” should be read in conjunction with the Consolidated Financial Statements and related notes thereto included in ITEM 8 of this Annual Report on Form 10-K.
Discussions of 2022 results and comparisons of 2022 results to 2023 results can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in PART II, ITEM 7 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.
Discussions of 2023 results and comparisons of 2023 results to 2024 results can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in PART II, ITEM 7 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.
We have made incremental investments to increase our new product development efforts to grow our business and strengthen our relationships with our customers. The investments primarily have been in the form of increased product development resources, increased customer and end-user awareness programs, and customer service improvements.
We have made incremental investments to increase our new product development efforts to grow our business and strengthen our relationships with our customers. The investments have primarily been in the form 27 of increased product development resources, additional customer and end-user awareness programs, and customer service improvements.
Change-over costs include the costs related to removing the customer’s inventory of competitor products and replacing it with our products, which is commonly referred to as a stock lift. Customer acquisition costs are recorded as a reduction to revenue when incurred.
Change-over costs include the costs associated with removing the customer’s inventory of competitor products and replacing it with our products, which is commonly referred to as a stock lift. Customer acquisition costs are recorded as a reduction to revenue when incurred.
Within the specialty vehicle sector, we focus on providing performance parts and accessories and nondiscretionary repair parts for UTVs and ATVs. We are dedicated to developing better and more innovative materials that will be compatible across a wide variety of makes and models to enhance both the performance and appearance of customers’ vehicles.
Within the specialty vehicle sector, we focus on providing performance parts and accessories and nondiscretionary repair parts for UTVs and ATVs. We are dedicated to developing better and more innovative materials that will be compatible across a wide variety of makes and models to maintain as well as to enhance both the performance and appearance of customers’ vehicles.
One area of focus for the light-duty sector has been our complex electronics program, which capitalizes on the growing number of electronic components being utilized on today’s OE platforms. New vehicles contain an average of approximately 100 electronic modules, with some high-end luxury vehicles exceeding that.
One area of focus for the light-duty sector has been our complex electronics program, which capitalizes on the growing number of electronic components being utilized on today’s original equipment platforms. New vehicles contain an average of approximately 100 electronic modules, with some high-end luxury vehicles exceeding that.
The remaining uses of cash from financing activities in each period resulted primarily from the repurchase of our common stock from our 401(k) Plan and income tax withholding in connection with the vesting of restricted stock awards (“RSAs”) and restricted stock units (“RSUs”), and proceeds from the exercise of stock options.
The remaining uses of cash from financing activities in each period resulted primarily from the repurchase of our common stock from our 401(k) Plan and income tax withholding in connection with the vesting of restricted stock awards (“RSAs”) and restricted stock units (“RSUs”), partially offset by proceeds from the exercise of stock options.
We believe that this sector provides many of the same growth opportunities that the light-duty sector has provided us. We specialize in offering parts to this sector that were traditionally only available from OE manufacturers or salvage yards, similar to how we approach the light-duty sector.
We believe that this sector provides many of the same growth opportunities that the light-duty sector has provided us. We specialize in offering parts to this sector that were traditionally only available from OEMs or salvage yards, similar to how we approach the light-duty sector.
Refer to Note 7, “Long-Term Debt”, to the Consolidated Financial Statements, included under ITEM 8, for additional information regarding our credit agreement.
Refer to Note 6, “Long-Term Debt”, to the Consolidated Financial Statements, included under ITEM 8, for additional information regarding our credit agreement.
We are one of the leading aftermarket suppliers of parts that were traditionally available to consumers only from OE manufacturers or salvage yards. These parts include, among other parts, leaf springs, intake manifolds, exhaust manifolds, oil filters and coolers, window regulators, radiator fan assemblies, tire pressure monitor sensors, exhaust gas recirculation (EGR) coolers, driveshafts, UTV windshields, and complex electronics modules.
We are one of the leading aftermarket suppliers of parts that were traditionally available to consumers only from OEMs or salvage yards. These parts include, among others, leaf springs, intake manifolds, exhaust manifolds, oil filters and coolers, window regulators, radiator fan assemblies, tire pressure monitor sensors, exhaust gas recirculation ("EGR") coolers, driveshafts, UTV windshields, and complex electronics modules.
We maintain contact 39 with our customer base to understand buying patterns, customer preferences, and the life cycle of our products. Changes in customer requirements are factored into the reserves, as needed. Purchase Accounting .
We maintain contact with our customer base to understand buying patterns, customer preferences, and the life cycle of our products. Changes in customer requirements are factored into the reserves, as needed.
At the time products are sold, we accrue a liability for product warranties and overstock returns as a percentage of sales based upon estimates established 33 using historical information on the nature, frequency, and average cost of the claim and the probability of the customer return.
At the time products are sold, we accrue a liability for product warranties and overstock returns as a percentage of sales based upon estimates established using historical information on the nature, frequency, and average cost of claims and the probability of customer returns.
See the “Statement Regarding Forward-Looking Statements” above and PART I, ITEM 1A, “Risk Factors” in this Annual Report on Form 10-K for additional information regarding forward-looking statements and the factors that could cause actual results to differ materially from those anticipated in the forward-looking statements.
See the “Cautionary Statement on Forward-Looking Information” above and PART I, ITEM 1A, “Risk Factors” in this Annual Report on Form 10-K for additional information regarding forward-looking statements and the factors that could cause actual results to differ materially from those anticipated in the forward-looking statements.
These investments historically have enabled us to provide an expanding array of new product offerings and grow revenues at levels that generally have exceeded market growth rates. In 2024, we introduced 5,335 new distinct parts to our customers and end-users, including 1,659 “New-to-the-Aftermarket” parts. Please see ITEM 1, “Business – Product Development” for a year-over-year comparison of new product introductions.
These investments have enabled us to provide an expanding array of new product offerings and grow revenues at levels that generally have exceeded market growth rates. In 2025, we introduced 5,560 new distinct parts to our customers and end-users, including 1,608 “New-to-the-Aftermarket” parts. Please see ITEM 1, “Business – Product Development” for a year-over-year comparison of new product introductions.
We attempt to avoid or minimize these concessions as much as possible, but we have granted pricing concessions, indemnification rights, and extended customer payment terms, and allowed a higher level of product returns in certain cases. These concessions impact net sales as well as our profit levels and may require additional capital to finance the business.
We attempt to avoid or minimize these concessions as much as possible, but we have granted pricing concessions, indemnification rights, and extended customer payment terms, and allowed a higher level of product returns in certain cases. These concessions affect both our net sales and profit levels, and may require additional capital to support the business.
The following table represents the total payments for the years ended December 31, 2024, 2023, and 2022, under the related party agreements described above: For the Year Ended December 31, (in thousands) 2024 2023 2022 Facility leases with Steven Berman-related entities $ 715 $ 2,918 $ 2,458 Facility leases with Lindsay Hunt-related entities $ 2,757 $ 2,603 $ 519 Service agreements with Lindsay Hunt-related entities $ 54 $ 200 $ 67 We are a partner in a joint venture with one of our suppliers and own minority interest investments in two other suppliers.
The following table represents the total payments for the years ended December 31, 2025, 2024, and 2023, under the related party agreements described above: For the Year Ended December 31, (in thousands) 2025 2024 2023 Facility leases with Steven Berman-related entities $ 735 $ 715 $ 2,918 Facility leases with Lindsay Hunt-related entities $ 2,812 $ 2,757 $ 2,603 Service agreements with Lindsay Hunt-related entities $ 46 $ 54 $ 200 35 We are a partner in a joint venture with one of our suppliers and own minority interest investments in two other suppliers.
In addition, we may pursue legal remedies when we see third parties violating our intellectual property rights, including those that violate our patents, wrongfully represent our products as their own, or use our product images for their own marketing efforts. Discounts, Allowances, and Incentives We offer a variety of customer discounts, rebates, defective and slow-moving product returns, and other incentives.
In addition, we may pursue legal remedies when we observe third parties violating our intellectual property rights, including those that infringe on our patents, misrepresent our products as their own, or use our product images for their own marketing efforts. Discounts, Allowances, and Incentives We offer a variety of customer discounts, rebates, defective and slow-moving product returns, and other incentives.
In ITEM 7, we discuss 2024 and 2023 results and comparisons of 2024 results to 2023 results.
In ITEM 7, we discuss 2025 and 2024 results and comparisons of 2025 results to 2024 results.
As of December 31, 2024, we marketed approximately 138,000 distinct parts compared to approximately 133,000 as of December 31, 2023, many of which we designed and engineered.
As of December 31, 2025, we marketed approximately 144,000 distinct parts compared to approximately 138,000 as of December 31, 2024, many of which we designed and engineered.
Refer to Note 5, “Leases”, to the Consolidated Financial Statements, included under ITEM 8, for additional information regarding our leases. • Credit agreement – total obligations under our credit agreement were $482.8 million, with $28.1 million due over the next twelve months.
Refer to Note 4, “Leases”, to the Consolidated Financial Statements, included under ITEM 8, for additional information regarding our leases. • Credit agreement – total obligations under our credit agreement were $440.6 million, with $37.5 million due over the next twelve months.
At December 31, 2024, our long-term cash requirements under our various contractual obligations include non-cancellable operating leases and outstanding borrowings under our credit agreement as follows: • Operating leases – total obligations under non-cancellable operating leases were $146.0 million, with $25.1 million due over the next twelve months.
At December 31, 2025, our long-term cash requirements under our various contractual obligations include non-cancellable operating leases and outstanding borrowings under our credit agreement as follows: • Operating leases – total obligations under non-cancellable operating leases were $138.8 million, with $30.0 million due over the next twelve months.
Significant judgments and estimates must be made and used in connection with establishing the sales returns and other allowances in any accounting period. Revisions to these estimates are made when necessary, based upon changes in these factors. We regularly study trends of such claims.
Significant judgments and estimates must be made and used in connection with establishing the sales returns and other allowances in any accounting period. Revisions to these estimates are made, when necessary, based upon changes in these factors.
Financing activities in the year ended December 31, 2024 included $78.9 million paid to repurchase 865,283 shares of common stock under our share repurchase plan, and the repayments of $78.8 million of outstanding borrowings under our revolving credit facility and $15.6 of our term loan balance under our credit agreement.
During the year ended December 31, 2024, $78.9 million was paid to repurchase 865,283 shares of common stock under our share repurchase plan, and we repaid $78.8 million of outstanding borrowings under our revolving credit facility and $15.6 million of our term loan balance under our credit agreement.
The increase in factoring costs year over year was primarily driven by higher accounts receivable sold under these programs. 37 Credit Agreement We have a credit agreement which consists of a $600.0 million revolving credit facility and a $500.0 million term loan.
The increase in factoring costs year over year was primarily driven by higher accounts receivable sold under these programs, partially offset by lower Term SOFR rates in 2025. Credit Agreement We have a credit agreement that consists of a $600.0 million revolving credit facility and a $500.0 million term loan.
Foreign Currency Many of our products and related raw materials and components are purchased from suppliers in a variety of non-U.S. countries. The products generally are purchased through purchase orders with the purchase price specified in U.S. dollars.
We regularly study trends of such claims. 29 Foreign Currency Many of our products and related raw materials and components are purchased from suppliers in non-U.S. countries. The products are generally sourced through purchase orders with the purchase price specified in U.S. dollars.
We historically have not utilized off-balance sheet financial instruments, and currently do not plan to utilize off-balance sheet arrangements in the future to fund our working capital requirements, operations, or growth plans. We may issue standby letters of credit under our credit agreement.
We have not utilized off-balance sheet financial instruments, and currently do not plan to utilize off-balance sheet arrangements in the future to fund our working capital requirements, operations, or growth plans. We may issue standby letters of credit under our credit agreement. Letters of credit totaling $1.1 million and $1.2 million were outstanding at December 31, 2025, and 2024, respectively.
Liquidity and Capital Resources Historically, our primary sources of liquidity have been our invested cash and the cash flow we generate from our operations, including accounts receivable sales programs facilitated by certain customers.
Liquidity and Capital Resources Historically, our primary sources of liquidity have been our invested cash and the cash flow we generate from our operations, including accounts receivable sales programs facilitated by certain customers. The following table presents key liquidity and capital resource metrics as of December 31, 2025, and 2024.
The credit agreement matures on October 4, 2027, is guaranteed by the Company’s material domestic subsidiaries , and is supported by a security interest in substantially all of the Company’s material domestic subsidiaries’ personal property and assets, subject to certain exceptions. As of December 31, 2024, we were not in default with respect to the credit agreement.
The credit agreement matures on October 4, 2027, is guaranteed by the Company’s material domestic subsidiaries , and is supported by a security interest in substantially all of the Company’s material domestic subsidiaries’ personal property and assets, subject to certain exceptions. As of December 31, 2025, there were $440.6 million in outstanding borrowings under the term loan.
Letters of credit totaling $1.2 million and $1.3 million were outstanding at December 31, 2024 and 2023, respectively. Those letters of credit are 38 issued primarily to satisfy the requirements of workers' compensation, general liability, and other insurance policies. Each of the outstanding letters of credit has a one-year term from the date of issuance.
Those letters of credit are issued primarily to satisfy the requirements of workers' compensation, general liability, and other insurance policies. Each of the outstanding letters of credit has a one-year term from the date of issuance.
As a result, we are continuously evaluating our approach to brand, pricing, and terms to our different customers and channels. For example, we maintain brand protection policies, which are designed to ensure that certain of our branded products are not advertised below certain approved pricing levels.
For example, we maintain brand protection policies, which are designed to ensure that certain of our branded products are not advertised below certain approved pricing levels.
The following table presents key liquidity and capital resource metrics as of December 31, 2024 and 2023. 36 (in thousands) December 31, 2024 December 31, 2023 Cash and cash equivalents $ 57,137 $ 36,814 Working capital $ 805,958 $ 686,558 Shareholders' equity $ 1,293,470 $ 1,168,203 Based on our current operating plan, we believe that our sources of available capital are adequate to meet our ongoing cash needs for at least the next twelve months.
(in thousands) December 31, 2025 December 31, 2024 Cash and cash equivalents $ 49,436 $ 57,137 Working capital $ 1,028,699 $ 805,958 Shareholders' equity $ 1,477,075 $ 1,293,470 Based on our current operating plan, we believe that our sources of available capital are adequate to meet our ongoing cash needs for at least the next twelve months.
Tariffs Tariffs increase our use of cash since we pay for the tariffs upon the arrival of our goods in the United States but collect the cash on any passthrough price increases from our customers on a delayed basis according to the payment terms negotiated with our customers.
Tariffs Increases in tariffs accelerate our use of cash, as we pay for the higher costs upon arrival of our goods in the United States, but we collect the cash from any pass-through price increases to our customers on a delayed basis, taking into account our inventory turns and payment terms negotiated with those customers.
Miles Driven The number of miles driven is another important statistic that impacts our business. Generally, as vehicles are driven more miles, the more likely it is that parts will fail and there will be increased demand for replacement parts, including our parts. According to the U.S.
Generally, as vehicles are driven more miles, the more likely it is that parts will fail and there will be increased demand for replacement parts, including our parts. According to the U.S. Department of Transportation, the number of miles driven through October 2025 increased 1.0% year over year in the light-duty sector.
Recently Issued Accounting Pronouncements Refer to Note 1, “Summary of Significant Accounting Policies” in the accompanying consolidated financial statements for additional information on recently issued accounting pronouncements.
Refer to Note 5, "Goodwill and Intangible Assets," in the accompanying consolidated financial statements for additional information on the goodwill impairment charge recorded in 2025. 36 Recently Issued Accounting Pronouncements Refer to Note 1, “Summary of Significant Accounting Policies,” in the accompanying consolidated financial statements for additional information on recently issued accounting pronouncements.
Critical Accounting Policies and Estimates Our discussion and analysis of our financial condition and results of operations are based upon the Consolidated Financial Statements, which have been prepared in accordance with U.S. generally accepted accounting principles.
Aggregate purchases from these companies were $24.8 million, $18.4 million, and $22.7 million in the years ended December 31, 2025, 2024, and 2023, respectively. Critical Accounting Policies and Estimates Our discussion and analysis of our financial condition and results of operations are based upon the Consolidated Financial Statements, which have been prepared in accordance with U.S. generally accepted accounting principles.
We attempt to offset inflationary pressures with cost-saving initiatives, price increases to customers, and the use of alternative suppliers. There can be no assurance that we will be successful in implementing such cost-saving initiatives, pricing increases, or supplier diversification in the future to offset increased inflationary costs.
There can be no assurance that we will be successful in implementing such cost-saving initiatives, pricing increases, or supplier diversification in the future to offset increased inflationary costs, or that the price increases we implement will not make our products uncompetitive or negatively impact customer demand.
Heavy Duty segment income from operations as a percentage of net sales decreased by 280 basis points for the year ended December 31, 2024, compared to the prior year.
Light Duty segment income from operations as a percentage of net sales increased to 20.5% for the year ended December 31, 2025, from 18.2% for the year ended December 31, 2024.
Additionally, in 2024 we generated $231.0 million of cash flows from operations, repaid a total of $94.4 million of outstanding debt obligations, and repurchased 865,283 common shares under a share repurchase program for $78.9 million. 31 New Product Development New product development is an important success factor for us and has been a source of growth for us.
Additionally, in 2025, we generated $113.6 million of cash flows from operations, repaid a total of $42.1 million of outstanding debt obligations, and repurchased 313,334 shares of common stock under our share repurchase program for $39.8 million. New Product Development New product development is a key success factor for us and has been a significant contributor to our growth.
Net of outstanding borrowings and letters of credit, we had $584.8 million available under the credit agreement as of December 31, 2024. Refer to Note 7, "Long-Term Debt", to the Consolidated Financial Statements, included under ITEM 8, for additional information regarding the credit agreement.
As of December 31, 2025, we were not in default with respect to our credit agreement. Refer to Note 6, "Long-Term Debt", to the Consolidated Financial Statements, included under ITEM 8, for additional information regarding the credit agreement.
Payment Terms and Accounts Receivable Sales Programs Over the past several years, we have continued to extend payment terms to certain customers as a result of customer requests and market demands. These extended terms have resulted in increased accounts receivable levels and significant uses of cash.
Payment Terms and Accounts Receivable Sales Programs We have and may continue to extend payment terms to certain customers in response to customer requests and market demands. These extended terms have resulted in increased accounts receivable levels and significant cash usage. Where available and when we deem appropriate, we participate in accounts receivable sales programs with several customers.
This decrease was primarily driven by the deleveraging of fixed costs on lower net sales and the impact of investments we made as part of initiatives to grow sales and improve margins on a long-term basis.
Heavy Duty segment income from operations as a percentage of net sales decreased by 60 basis points for the year ended December 31, 2025, compared to the prior year. This decrease was primarily driven by lower 32 productivity, and the impact of investments we made as part of initiatives to grow sales and improve margins on a long-term basis.
Department of Transportation, the number of miles driven through October 2024 increased 1.0% year over year in the light-duty sector. However, global gasoline prices remained high during 2024 and, if they continue, they may negatively impact miles driven as consumers reduce travel or seek alternative methods of transportation. Brand Protection We operate in a highly competitive market.
However, global gasoline prices remained high during 2025 and, if high prices persist, they may negatively impact miles driven as consumers reduce travel or seek alternative methods of transportation. Brand Protection We operate in a highly competitive market. As a result, we are continuously evaluating our approach to branding, pricing, and terms for our customers and channels.
The introduction of new products and product lines to customers, as well as business acquisitions, may also cause significant fluctuations from quarter to quarter.
The introduction of new products and product lines to customers, as well as business acquisitions, may also cause significant fluctuations from quarter to quarter. Business Performance Summary Net sales increased 6% to $2,130.3 million in 2025 from $2,009.2 million in 2024. Net income increased 7% to $204.2 million in 2025 from $190.0 million in 2024.
See Note 2, "Business Acquisitions and Investments", to the Consolidated Financial Statements, included under ITEM 8 for additional information. We may acquire businesses in the future to supplement our financial growth, increase our customer base, add to our distribution capabilities, or enhance our product development resources, among other reasons.
Acquisitions A key component of our strategy is growth through acquisitions. We may acquire businesses in the future to supplement our financial growth, expand our customer base, add to our distribution capabilities, or enhance our product development resources, among other reasons.
Specialty Vehicle segment income from operations as a percentage of net sales increased to 15.2% for the year ended December 31, 2024, from 15.0% for the year ended December 31, 2023. This increase was primarily driven by the sell-through of lower-cost inventory and cost savings initiatives compared to the year ended December 31, 2023.
Specialty Vehicle segment income from operations as a percentage of net sales decreased to 13.1% for the year ended December 31, 2025, from 15.2% for the year ended December 31, 2024.
Further extensions of customer payment terms would result in additional uses of cash or increased costs associated with the sales of accounts receivable. During the years ended December 31, 2024 and 2023, factoring costs associated with these accounts receivable sales programs were $51.3 million and $50.2 million, respectively.
Further extensions of customer payment terms would result in additional cash usage or increased costs associated with the sales of accounts receivable.
Further extensions of customer payment terms would result in additional uses of cash or increased costs associated with the sales of accounts receivable. During the years ended December 31, 2024 and 2023, we sold approximately $1,106.4 million and $949.5 million, respectively, under these programs.
We had capacity to sell more accounts receivable under these programs if the needs of the business warranted. Further extensions of customer payment terms would result in additional uses of cash or increased costs associated with the sales of accounts receivable.
If receivables had not been sold, $853.6 million and $526.4 million of additional receivables would have been outstanding at December 31, 2024 and 2023, respectively, based on standard payment terms. We had capacity to sell more accounts receivable under these programs if the needs of the business warranted.
Sales of accounts receivable under these programs, and related factoring costs, were as follows: (in thousands) December 31, 2025 December 31, 2024 Sales of accounts receivable $ 1,387,816 $ 1,106,400 Factoring costs $ 58,309 $ 51,252 If receivables had not been sold, $1,093.1 million and $853.6 million of additional receivables would have been outstanding at December 31, 2025 and 2024, respectively, based on standard payment terms.
Cash Flows Below is a table setting forth the key lines of our Consolidated Statements of Cash Flows: For the Year Ended December 31, (in thousands) 2024 2023 Cash provided by operating activities $ 231,047 $ 208,758 Cash used in investing activities (39,321) (43,901) Cash used in financing activities (170,979) (174,109) Effect of foreign exchange on cash and cash equivalents (424) 32 Net increase (decrease) in cash and cash equivalents $ 20,323 $ (9,220) During the year ended December 31, 2024, cash provided by operating activities was $231.0 million compared to $208.8 million during the year ended December 31, 2023.
Cash Flows Below is a table setting forth the key lines of our Consolidated Statements of Cash Flows: For the Year Ended December 31, (in thousands) 2025 2024 Cash provided by operating activities $ 113,634 $ 231,047 Cash used in investing activities (37,969) (39,321) Cash used in financing activities (83,689) (170,979) Effect of foreign exchange on cash and cash equivalents 323 (424) Net (decrease) increase in cash and cash equivalents $ (7,701) $ 20,323 During the year ended December 31, 2025, cash provided by operating activities decreased $117.4 million from the prior year primarily as a result of cash used to fund investments in inventory to meet customer demand and to pay for increased tariffs on imports, partially offset by higher proceeds from selling accounts receivable under our customer-sponsored accounts receivable sales programs. 34 Investing activities used $38.0 million and $39.3 million of cash in the years ended December 31, 2025, and 2024, respectively.
Interest rates may hold steady at their current rates for prolonged periods or may increase in the future, resulting in increased costs associated with our accounts receivable sales programs and outstanding borrowings. During the year ended December 31, 2023, we saw significant increases in Term SOFR and other reference rates.
Interest rates may remain steady at their current levels for prolonged periods or may increase in the future, resulting in increased costs associated with our accounts receivable sales programs and outstanding borrowings. Interest rates remained elevated throughout much of 2024, but began to decline starting in the second half of that year and generally declined throughout 2025.
Where available and when we deem appropriate, we participate in accounts receivable sales programs with several customers that allow us to sell our accounts receivable to financial institutions to offset the negative cash flow impact of these payment term extensions.
The programs generally enable us to sell our accounts receivable to financial institutions at discounted rates without recourse to offset the negative cash flow impact of these 33 payment term extensions.
Our effective tax rate increased to 25.9% in the year ended December 31, 2024 from 23.3% in the year ended December 31, 2023, primarily due to recording a reserve in 2024 in connection with a state tax dispute. 35 Segment Operating Results Segment operating results were as follows: For the Year Ended December 31, (in thousands) 2024 2023 Net Sales: Light Duty $ 1,565,601 $ 1,462,474 Heavy Duty 231,515 256,913 Specialty Vehicle 212,081 210,401 Total $ 2,009,197 $ 1,929,788 Segment income from operations: Light Duty $ 284,165 $ 187,159 Heavy Duty 6,479 14,505 Specialty Vehicle 32,335 31,618 Total $ 322,979 $ 233,282 Light Duty Light Duty net sales increased $103.1 million, or 7.1%, for the year ended December 31, 2024 compared to the prior year, primarily due to volume increases, including sales of new products launched.
Segment Operating Results Segment operating results were as follows: For the Year Ended December 31, (in thousands) 2025 2024 Net Sales: Light Duty $ 1,692,055 $ 1,565,601 Heavy Duty 232,594 231,515 Specialty Vehicle 205,670 212,081 Total $ 2,130,319 $ 2,009,197 Segment income from operations: Light Duty $ 347,318 $ 284,165 Heavy Duty 5,111 6,479 Specialty Vehicle 26,850 32,335 Total $ 379,279 $ 322,979 Light Duty Light Duty net sales increased $126.5 million, or 8.1%, for the year ended December 31, 2025, compared to the prior year, primarily due to tariff-related pricing actions, increased customer demand in the first half of the year, and strong demand for new products.
Gross profit as a percentage of net sales increased 460 basis points compared to the prior year primarily due to sales of lower-cost inventory and cost savings initiatives.
Gross profit as a percentage of net sales increased 200 basis points compared to the prior year, primarily due to a timing benefit of tariff-related price increases taking effect before the increased cost of inventory, reflecting higher tariffs, was recognized as an expense in our statement of operations.
We believe this trend has supported an increase in VIO, which increased to 298.5 million, a 1% increase in 2024 over 2023. According to data published by Polk, a division of IHS Automotive, the average age of VIO increased to 12.8 years as of October 2024 from 12.6 years as of October 2023.
According to data published by Polk, a division of IHS Automotive, the average age of VIO increased to 12.9 years as of October 2025 from 12.8 years as of October 2024. 28 Miles Driven The number of miles driven is another important statistic that impacts our business.
As of December 31, 2024, there was $14.0 million in outstanding borrowings under the revolving credit facility, and $468.8 million in outstanding borrowings under the term loan portion of the credit agreement, and as of such date we had outstanding letters of credit for $1.2 million in the aggregate.
Also on that date, we had outstanding letters of credit for $1.1 million in the aggregate. Net of outstanding borrowings and letters of credit, we had $598.9 million available under the credit agreement as of December 31, 2025. Our credit agreement contains affirmative and negative covenants.
Selling, general and administrative expenses (“SG&A”) increased $42.8 million, or 120 basis points as a percentage of net sales for the year ended December 31, 2024, compared to the prior year, primarily due to $20.5 million of favorable fair value adjustments in the prior year period to the estimated contingent consideration obligation for an acquisition and higher compensation and benefits costs in the current year period.
Additionally, favorable mix from higher sales of new products, as well as supplier diversification, productivity, and automation initiatives, benefited the gross profit percentage during the year. 31 Selling, general, and administrative expenses (“SG&A”) increased $28.0 million, but decreased 20 basis points as a percentage of net sales for the year ended December 31, 2025, compared to the prior year, due to favorable leverage on higher net sales that more than offset additional investments made in the current year.
Specialty Vehicle Specialty Vehicle net sales increased $1.7 million, or 0.8%, for the year ended December 31, 2024 compared to the prior year, primarily due to volume increases, including sales of new products launched.
Specialty Vehicle Specialty Vehicle net sales decreased $6.4 million, or 3.0%, for the year ended December 31, 2025, compared to the prior year, primarily due to reduced customer demand across our sales channels, partially offset by pricing actions.
Interest rates remained elevated throughout much of 2024, but began to decline starting in the second half of 2024. Impact of Tariffs We source the majority of our raw materials and parts from suppliers in a variety of non-U.S. countries.
Impact of Tariffs We source the majority of our raw materials and parts from suppliers in various non-U.S. countries. In 2025, approximately 77% of our total volume of purchases of products was sourced from suppliers in various non-U.S. countries, with approximately 38% sourced from third-party suppliers in China. At the beginning of 2025, the U.S.
Light Duty segment income from operations as a percentage of net sales increased to 18.2% for the year ended December 31, 2024, from 12.8% for the year ended December 31, 2023. This increase was primarily driven by the sell-through of lower-cost inventory and operational excellence initiatives delivering cost-savings, partially offset by higher compensation and benefits costs.
This increase was primarily driven by a timing benefit of tariff-related price increases taking effect before the increased cost of inventory, reflecting higher tariffs, was recognized as an expense in segment income, favorable mix from higher new product sales, operational excellence initiatives delivering cost savings, and favorable leverage on higher net sales.
Removed
Our 2024 fiscal year was a 52-week period that ended on December 31, 2024, our 2023 fiscal year was a 52-week period that ended on December 31, 2023 and our fiscal 2022 was a 53-week period that ended on December 31, 2022. Business Performance Summary Net sales increased 4% to $2,009.2 million in 2024 from $1,929.8 million in 2023.
Added
We believe this trend has supported an increase in VIO, which increased to 302.7 million, a 1% increase in 2025 over 2024.
Removed
Net income increased 47% to $190.0 million in 2024 from $129.3 million in 2023.
Added
We attempt to offset inflationary pressures with cost-saving initiatives, price increases to customers, and the use of alternative suppliers.
Removed
Acquisitions A key component of our strategy is growth through acquisitions. On October 4, 2022, we acquired Super ATV, a leading independent supplier to the powersports aftermarket with a family of highly respected brands spanning functional accessories and upgrades, as well as replacement parts for specialty vehicles.
Added
Administration implemented new tariffs that took effect throughout the year, and it continues to engage in trade negotiations with other countries regarding the implementation of additional tariffs.
Removed
Prior to 2025, the U.S. government imposed tariffs on certain foreign goods, including steel and aluminum and certain vehicle parts, which resulted in increased costs for importing those goods into the United States. Those tariffs primarily impacted raw materials and parts that we source from China.
Added
These actions, as well as reactionary tariff adjustments made by other countries, have impacted our business and contributed to inflationary cost increases, and we expect these impacts to continue. 30 We have taken actions designed to mitigate the impacts of tariffs, including, but not limited to, diversifying our supply chain and negotiating cost concessions from our suppliers where possible.
Removed
We have taken several actions to 34 mitigate the impact of those tariffs, including, but not limited to, passing along price increases to our customers and negotiating cost concessions from our suppliers. We are actively monitoring recent trade policy and tariff announcements, including the executive orders issued by the President of the United States in February 2025.
Added
In addition, starting in the third quarter of 2025, we implemented pass-through price increases to offset the dollar impact of certain new tariff costs. We experienced a temporary increase in gross margin in 2025 due to the price increases taking effect before the increased cost of inventory, reflecting higher tariffs, was recognized as an expense in our statement of operations.
Removed
Among other things, those executive orders directed the United States to impose new tariffs on imports from Canada, Mexico, and China, subsequently paused the imposition of tariffs on Canada and Mexico for a month, announced tariffs on steel and aluminum imported into the United States, and directed federal agencies to investigate how to adjust U.S. tariffs to match those of other countries.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeA one-percentage-point increase in the reference rate or base rate would have increased our interest expense on our variable rate debt under our credit agreement by approximately $5.6 million, $6.8 million, and $2.4 million in the years ended December 31, 2024, 2023, and 2022, respectively.
Biggest changeA one-percentage-point increase in the reference rate or base rate would have increased our interest expense on our variable rate debt under our credit agreement by approximately $4.6 million, $5.6 million, and $6.8 million in the years ended December 31, 2025, 2024, and 2023, respectively.
A one-percentage-point increase in Term SOFR or the discount rates on the accounts receivable sales programs would have increased our factoring costs and reduced the amount of cash we would have received by approximately $8.8 million, $7.9 million, and $8.7 million in the years ended December 31, 2024, 2023, and 2022, respectively.
A one-percentage-point increase in Term SOFR or the discount rates on the accounts receivable sales programs would have increased our factoring costs and reduced the amount of cash we would have received by approximately $11.3 million, $8.8 million, and $7.9 million in the years ended December 31, 2025, 2024, and 2023, respectively.

Other DORM 10-K year-over-year comparisons