LiveWire Group Inc.

05/06/2026 | Press release | Distributed by Public on 05/06/2026 15:22

Quarterly Report for Quarter Ending March 31, 2026 (Form 10-Q)

Management's Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis is intended to help the reader understand the Company, the Company's financial condition and results of operations, and the Company's present business environment. The following discussion and analysis should be read together with the accompanying unaudited consolidated financial statements and related notes included elsewhere in this Quarterly Report and the audited consolidated financial statements and related notes in the 2025 Annual Report on Form 10-K.
Overview
LiveWire is an industry-leading all-electric vehicle brand with a mission to pioneer the rapidly growing two-wheel electric motorcycle space. The Company operates in two segments: Electric Motorcycles and STACYC.
The Electric Motorcycles segment sells electric motorcycles, related parts and accessories and apparel in the United States and certain international markets, while the STACYC segment sells electric balance bikes, electric bikes, and related parts, accessories and apparel in the United States and certain international markets. The STACYC segment launched an adult pedal assist electric bike in the United States in March 2025.
Electric motorcycles are sold at wholesale to a network of Independent Retail Partners, at retail through a Company-owned dealership and through online sales. Electric balance bikes and electric bikes are sold at wholesale to independent dealers and independent distributors, as well as direct to customers online. As discussed below, on September 26, 2022 as part of the Business Combination, the Company, which included LiveWire branded electric motorcycles and STACYC, became a separate, publicly traded company.
For the three months ended March 31, 2026, the Company's net loss was $18,128 thousand compared to $19,271 thousand for the three months ended March 31, 2025. The Company's net losses reflect the early-stage nature of the Company's business including investments in product development as the Company continues to focus on technological innovation that it expects will support future products and growth. The decrease in net loss of $1,143 thousand for the three months ended March 31, 2026, reflect the segment results and changes in interest expense, related party, interest income and the change in fair value of warrant liabilities discussed below.
For the three months ended March 31, 2026, the Electric Motorcycles segment operating loss was $16,701 thousand compared to an operating loss of $19,353 thousand for the three months ended March 31, 2025. Refer to the Electric Motorcycles segment analysis below for further discussion on the decrease in operating loss of $2,652 thousand for the three months ended March 31, 2026.
For the three months ended March 31, 2026, the STACYC segment operating loss was $971 thousand compared to an operating loss of $1,313 thousand for the three months ended March 31, 2025. Refer to the STACYC segment analysis below for further discussion on the decrease in operating loss of $342 thousand for the three months ended March 31, 2026.
In response to the market challenges facing the electric vehicle segment and the overall broader powersports industry, the Company is continuing to focus on strategic expansion of its product offerings, including the planned production in the spring of 2026 of two new 125 cc-equivalent mini-motos, the S4 HonchoTM products, which are designed to expand access and affordability for riders globally. As the Company evaluates its long-term strategy and product offerings, it will continue to focus on cost savings to reduce cash usage while focusing on developing and producing profitable products to align with evolving customer preferences and broader electric vehicle adoption trends that will allow the Company to continue to reduce operating losses and fund its operations through profitability.
On August 22, 2025, LiveWire entered into an At-The-Market Issuance Sales Agreement with Mizuho Securities USA LLC, as agent (the "Agent"), under which LiveWire may offer and sell, from time to time at its sole discretion, an aggregate gross sale price of up to $50.0 million of shares of its common stock through the Agent (the "ATM Program"), pursuant to an effective shelf registration statement on Form S-3 (Registration No. 333-289699), which was declared effective by the SEC on August 21, 2025. LiveWire filed a prospectus supplement with the SEC on August 22, 2025 in connection with the ATM Program.
Business Combination
On September 26, 2022, the Company consummated a previously announced business combination and related financing transactions (collectively the "Business Combination") pursuant to a business combination agreement, dated as of December 12, 2021 (the "Business Combination Agreement"), by and among AEA-Bridges Impact Corp ("ABIC"), LiveWire EV Holdings, Inc., a Delaware corporation (now known as "LiveWire Group, Inc."), LW EV Merger Sub, Inc., a Delaware corporation ("Merger Sub"), Harley-Davidson, Inc., a Wisconsin corporation ("H-D"), and LiveWire EV, LLC ("Legacy LiveWire"), a wholly-owned subsidiary of H-D.
The Business Combination was accounted for as a reverse recapitalization. Under this method of accounting, ABIC was treated as the "acquired" company for financial reporting purposes. Accordingly, the Business Combination was treated as the equivalent of the Company issuing stock for the net assets of ABIC, accompanied by a recapitalization. The net assets of ABIC were stated at historical cost, with no goodwill or other intangible assets recorded resulting from the Business Combination. The Business Combination resulted in net proceeds of approximately $293.7 million. The Company also assumed the Public Warrants and Private Warrants upon consummation of the Business Combination. See further detail in Note 7, Warrant Liabilities, to the consolidated financial statements.
2026 Outlook
For 2026, LiveWire's focus is on the launch of its two new 125 cc-equivalent mini-motors, the S4 HonchoTM products, continued network expansion, cost savings and improvements, product innovation and development focused on profitable products, and continued growth of the STACYC segment.
Key Business Metrics
To analyze LiveWire's business performance, determine financial forecasts and help develop long-term strategic plans, management reviews the following key business metrics, which are important measures that represent the growth of the business:
•Wholesale Motorcycle Unit Sales - LiveWire defines Wholesale Motorcycle Unit Sales as the number of electric motorcycles sold by LiveWire to independent dealers for which LiveWire recognized revenue during the period.
•Company Retail Motorcycle Unit Sales - LiveWire defines Company Retail Motorcycle Unit Sales as the number of new electric motorcycles sold at retail by LiveWire through its Company-owned dealership, through online sales or direct to customers through select international partners for which LiveWire recognized revenue during the period.
•Independent Retail Motorcycle Unit Sales - LiveWire defines Independent Retail Motorcycle Unit Sales as the number of new electric motorcycles sold at retail by Independent Retail Partners. These unit sales do not generate revenues for LiveWire but generate revenues for individual retail partners. The data source for electric motorcycle retail sales figures is new sales warranty and registration information provided by Independent Retail Partners and compiled by LiveWire. LiveWire must rely on information that its Independent Retail Partners supply concerning new retail sales, and LiveWire does not regularly verify the information that its Independent Retail Partners supply. This information is subject to revision.
•Retail Motorcycle Unit Sales - LiveWire defines Retail Motorcycle Unit Sales as the sum of Company Retail Motorcycle Unit Sales and Independent Retail Motorcycle Unit Sales.
•Company-Owned Dealership - Dealership owned and operated by LiveWire to sell electric motorcycles, related products, and services.
•Independent Retail Partners (Electric Motorcycles) - Independent Retail Partners as used with Electric Motorcycles are dealers owned and operated by independent entities under contract with LiveWire to sell LiveWire electric motorcycles, related products and services.
•Electric Balance Bike and Electric Bike Unit Sales (STACYC) - LiveWire defines Electric Balance Bike and Electric Bike Unit Sales as the number of electric balance bikes and pedal assist electric bikes sold by LiveWire for which LiveWire recognized revenue during the period.
•Independent Retail Partners (STACYC) - Independent Retail Partners as used with STACYC are independent entities under contract with STACYC to sell electric balance bikes, electric bikes and related products and services.
The following table details the key business metric amounts for the periods indicated:
Three months ended
March 31,
2026 		March 31,
2025
Wholesale Motorcycle Unit Sales 76 32
Company Retail Motorcycle Unit Sales 15 1
Total LiveWire Motorcycle Unit Sales 91 33
Retail Motorcycle Unit Sales:
Company Retail Motorcycle Unit Sales (1)
15 1
Independent Retail Partners (2)
104 68
Total Retail Motorcycle Unit Sales 119 69
Electric Balance Bike and Electric Bike Unit Sales:
US 3,717 1,945
International 242 25
Total Electric Balance Bike and Electric Bike Unit Sales
3,959 1,970
(1) Data source for Company Retail Motorcycle Unit Sales figures shown above is LiveWire's records.
(2) Data source for Independent Retail Motorcycle Unit Sales figures shown above is new sales warranty and registration information provided by retail partners and compiled by LiveWire. LiveWire must rely on information that its Independent Retail Partners supply concerning new retail sales, and LiveWire does not regularly verify the information that its Independent Retail Partners supply. This information is subject to revision.
The following table details the number of retail partners:
As of As of
March 31, 2026 December 31, 2025
Electric Motorcycles
Company-Owned Dealership 1 1
Independent Retail Partners 92 96
Total Electric Motorcycles Retail Partners 93 97
STACYC
Independent Retail Partners:
U.S. 2,002 1,986
International 43 31
Total STACYC Independent Retail Partners 2,045 2,017
The Electric Motorcycles Independent Retail Partners shown above include those that have been contracted by LiveWire to sell LiveWire motorcycles. As of March 31, 2026 and December 31, 2025, there were nine partners and one partner, respectively, that were actively working to complete the licensing required to sell LiveWire motorcycles as of the end of the period. LiveWire intends to grow this network as it expands its distribution capabilities.
LiveWire believes these key business metrics provide useful information to help investors understand and evaluate LiveWire's business performance. Wholesale Motorcycle Unit Sales and Company Retail Motorcycle Unit Sales are key drivers of revenue and operating results for the Electric Motorcycles segment. Retail Motorcycle Unit Sales made through both the Company-owned dealership and Independent Retail Partners are a key measure of consumer demand and market share for LiveWire's electric motorcycles. Total Electric Balance Bike and Electric Bike Unit Sales is a key driver of revenue and profit for STACYC.
Results of Operations
The following table presents consolidated results of operations for the three months ended March 31, 2026 and 2025 (in thousands):
Three months ended
March 31,
2026 		March 31,
2025 		$ Change % Change
Operating loss from Electric Motorcycles $ (16,701) $ (19,353) $ 2,652 13.7 %
Operating loss from STACYC (971) (1,313) 342 26.0 %
Total operating loss (17,672) (20,666) 2,994 14.5 %
Interest expense, related party (1,417) - (1,417) (100.0) %
Interest income 603 504 99 19.6 %
Change in fair value of warrant liabilities 383 905 (522) (57.7) %
Loss before income taxes (18,103) (19,257) 1,154 6.0 %
Income tax provision 25 14 11 78.6 %
Net loss (18,128) (19,271) 1,143 5.9 %
Other comprehensive loss:
Foreign currency translation adjustments - (15) 15 100.0 %
Comprehensive loss $ (18,128) $ (19,286) $ 1,158 6.0 %
Net loss per share, basic and diluted $ (0.09) $ (0.09) $ - - %
Operating Loss
The Company reported an operating loss of $17,672 thousand for the three months ended March 31, 2026 compared to $20,666 thousand for the three months ended March 31, 2025. The Electric Motorcycles segment reported an operating loss of $16,701 thousand for the three months ended March 31, 2026 compared to $19,353 thousand for the three months ended March 31, 2025. The STACYC segment reported operating loss of $971 thousand for the three months ended March 31, 2026 compared to $1,313 thousand for the three months ended March 31, 2025. Refer to the Electric Motorcycles and STACYC Segment discussions for a more detailed analysis of the factors affecting operating results.
Interest Expense, Related Party
Interest expense, related party, for the three months ended March 31, 2026 was $1,417 thousand compared to zero for the three months ended March 31, 2025. The expense is related to the Company borrowing $75.0 million from H-D under the Term Loan on December 15, 2025. See Note 11, Related Party Transactions, in the consolidated financial statements for further discussion.
Interest Income
Interest income for the three months ended March 31, 2026 was $603 thousand compared to $504 thousand for the three months ended March 31, 2025. The investment in money market funds increased to $57.0 million as of March 31, 2026 from $35.0 million as of March 31, 2025 after the Company borrowed $75.0 million under the Term Loan on December 15, 2025. See Note 11, Related Party Transactions, in the consolidated financial statements for further discussion.
Change in Fair Value of Warrant Liabilities
Change in fair value of warrant liabilities for the three months ended March 31, 2026 was income of $383 thousand compared to income of $905 thousand for the three months ended March 31, 2025. The income recognized for the three months ended March 31, 2026 and 2025 was due to the decrease in the estimated fair value due to fluctuations in the market price of the warrants. See Note 7, Warrant Liabilities, in the consolidated financial statements for further discussion.
Income Tax Provision
The income tax provision for the three months ended March 31, 2026 was $25 thousand compared to $14 thousand for the three months ended March 31, 2025. The Company believes there is not sufficient positive evidence for the tax benefit generated by the current period operating loss in the U.S. to be benefited in future periods.
Segment Results
Electric Motorcycles
The following table presents consolidated results of operations for the Electric Motorcycles segment for the three months ended March 31, 2026 and 2025 (in thousands):
Three months ended
March 31,
2026 		March 31,
2025 		$ Change % Change
Revenue:
Electric motorcycles $ 867 $ 140 $ 727 519.3 %
Parts, accessories and apparel 540 279 261 93.5 %
Revenue, net 1,407 419 988 235.8 %
Cost of goods sold 3,319 3,400 (81) (2.4) %
Gross profit (1,912) (2,981) 1,069 35.9 %
Operating expenses:
Selling, administrative and engineering expense 14,789 16,372 (1,583) (9.7) %
Operating loss $ (16,701) $ (19,353) $ 2,652 13.7 %
Revenue
Revenue for the three months ended March 31, 2026 increased by $988 thousand, or 235.8%, to $1,407 thousand from $419 thousand for the three months ended March 31, 2025. Unit sales increased by 58 units, or 175.8%, from 33 units in 2025 to 91 units in 2026. Unit sales and revenue in the three months ended March 31, 2025 were negatively impacted by returns.
Cost of Goods Sold
Cost of goods sold for the three months ended March 31, 2026 decreased by $81 thousand, or 2.4%, to $3,319 thousand from $3,400 thousand for the three months ended March 31, 2025. The increase in Cost of goods sold from increased unit sales in the three months ended March 31, 2026 was offset by decreased depreciation expense of $868 thousand.
Selling, Administrative and Engineering Expense
Selling, administrative and engineering expense for the three months ended March 31, 2026 decreased by $1,583 thousand, or 9.7%, to $14,789 thousand from $16,372 thousand for the three months ended March 31, 2025. The decrease was primarily driven by continued focus on cost reduction, including lower personnel costs of $1,438 thousand from reduced headcount in 2026 as compared to 2025.
STACYC
The following table presents consolidated results of operations for the STACYC segment for the three months ended March 31, 2026 and 2025 (in thousands):
Three months ended
March 31,
2026 		March 31,
2025 		$ Change % Change
Revenue:
Electric balance bikes and electric bikes $ 2,734 $ 1,679 $ 1,055 62.8 %
Parts, accessories and apparel 974 645 329 51.0 %
Revenue, net 3,708 2,324 1,384 59.6 %
Cost of goods sold 2,333 1,511 822 54.4 %
Gross profit 1,375 813 562 69.1 %
Operating expenses:
Selling, administrative and engineering expense 2,346 2,126 220 10.3 %
Operating loss $ (971) $ (1,313) $ 342 26.0 %
Revenue
Revenue for the three months ended March 31, 2026 increased by $1,384 thousand, or 59.6%, to $3,708 thousand from $2,324 thousand for the three months ended March 31, 2025. The increase in revenue of $1,384 thousand was primarily driven by higher volumes in all markets and higher shipment volumes to our third-party distributors in the three months ended March 31, 2026 compared to the three months ended March 31, 2025.
Cost of Goods Sold
Cost of goods sold for the three months ended March 31, 2026 increased by $822 thousand, or 54.4%, to $2,333 thousand from $1,511 thousand for the three months ended March 31, 2025. The increase was primarily due to higher volumes in alignment with the increased revenue described above.
Selling, Administrative and Engineering Expense
Selling, administrative and engineering expense for the three months ended March 31, 2026 increased by $220 thousand, or 10.3%, to $2,346 thousand from $2,126 thousand for the three months ended March 31, 2025. Selling, administrative and engineering expense remained relatively consistent in the three months ended March 31, 2026 compared to the three months ended March 31, 2025 with the change primarily driven by increased research and development expenses.
Other Matters
Commitments and Contingencies
The Company is subject to lawsuits and other claims related to product, commercial, supplier, employee, environmental and other matters. In determining costs to accrue related to these items, the Company carefully analyzes cases and considers the likelihood of adverse judgments or outcomes, as well as the potential range of possible loss. Any amounts accrued for these matters are monitored on an ongoing basis and are updated based on new developments or new information as it becomes available for each matter. Refer to Note 10, Commitments and Contingencies, in the consolidated financial statements for a discussion of the Company's commitments and contingencies.
Liquidity and Capital Resources
As of March 31, 2026 and December 31, 2025, LiveWire's cash and cash equivalents were $67,495 thousand and $82,777 thousand, respectively.
As an early growth company, LiveWire does not expect to generate positive cash flow from operations over the next twelve months. Prior to the Business Combination, H-D supported LiveWire's operating, investing and financing activities. Following the Business Combination, LiveWire received net proceeds of approximately $293.7 million. The Company also assumed the Public Warrants and Private Warrants upon consummation of the Business Combination. See further detail in Note 7, Warrant Liabilities, to the consolidated financial statements.
In the event of the exercise of any Warrants for cash, LiveWire will receive the proceeds from such exercise. Assuming the exercise in full of all of Warrants for cash, LiveWire would receive an aggregate of approximately $349.2 million, but would not receive any proceeds from the sale of the shares of Common Stock issuable upon such exercise. To the extent any of the Warrants are exercised on a "cashless basis," LiveWire will not receive any proceeds upon such exercise. LiveWire expects to use any proceeds it receives from Warrant exercises for general corporate and working capital purposes, which would increase its liquidity. LiveWire believes the likelihood that warrant holders will exercise their Warrants, and therefore the amount of cash proceeds LiveWire would receive, is dependent upon the trading price of its Common Stock. As of March 31, 2026, the reported sales price of Common Stock was $1.66 per share. If the trading price of Common Stock is less than the $11.50 exercise price per share of the Warrants, LiveWire expects that warrant holders will not exercise their Warrants. There is no guarantee the Warrants will be in the money following the time they become exercisable and prior to their expiration, and as such, the Warrants may expire worthless and LiveWire may receive no proceeds from the exercise of Warrants. As a result, LiveWire does not expect to rely on the cash exercise of Warrants to fund its operations and LiveWire does not believe that it needs such proceeds to support working capital and capital expenditure requirements for the next twelve months. LiveWire will continue to evaluate the probability of Warrant exercises and the merit of including potential cash proceeds from the exercise of the Warrants in its future liquidity projections. LiveWire instead currently expects to rely on the sources of funding described below, if available on reasonable terms or at all.
On February 14, 2024, the Company entered into a Convertible Delayed Draw Term Loan Agreement (the "Convertible Term Loan") with H-D providing for term loans from H-D to the Company in one or more advances up to an aggregate principal amount of $100 million. The Convertible Term Loan had a maturity date of the earlier of (i) 24 months from the date of the first draw on the loan or (ii) October 31, 2026. The Convertible Term Loan contained a provision that provided for H-D to convert amounts outstanding to equity at the Maturity Date if, on the Maturity Date, H-D determined, acting reasonably and in good faith, that the Company does not have the financial wherewithal to repay all amounts outstanding.
On November 9, 2025, the Company entered into an Amended and Restated Delayed Draw Term Loan Agreement (the "Term Loan") with H-D, which amended the Convertible Term Loan. The Term Loan provided the Company with access of up to $75.0 million to be drawn by the Company between November 17, 2025 and December 15, 2025. The maturity date of the amount outstanding under the Term Loan, including interest, is December 15, 2027 ("Term Loan Maturity Date"). The Term Loan requires mandatory prepayment of the principal amount of the Term Loan from the first $10.0 million of net ATM proceeds (defined as gross ATM proceeds less offering costs) from the funding of the Term Loan through the Term Loan Maturity Date. No other scheduled principal payments are required to be made on the Term Loan and the remaining principal balance must be paid in full on the Term Loan Maturity Date. The amount outstanding under the Term Loan bears interest at a floating rate per annum, as calculated by H-D as of the date of funding of the Term Loan and as of each June 1 and December 1 thereafter, equal to the sum of (i) the forward-looking term rate based on SOFR (i.e., the secured overnight financing rate published by the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate)) for a 6-month interest period, plus (ii) 4.00%. Interest is compounded on a semi-annual basis on May 31 and November 30 and is required to be paid in full on the Term Loan Maturity Date. The Term Loan includes negative covenants restricting the ability of the Company to incur indebtedness, create liens, sell assets, make investments, make fundamental changes, make dividends or other restricted payments and enter into affiliate transactions. All of the obligations under the Term Loan are collateralized by a security interest in substantially all of the assets of the Company.
On December 15, 2025, the Company borrowed $75.0 million under the Term Loan. The Company paid $800 thousand in the three months ended March 31, 2026 for the mandatory prepayment related to net ATM proceeds received from shares sold in the three months ended December 31, 2025. As of March 31, 2026 and December 31, 2025, there was $0 thousand and $800 thousand, respectively, presented as Current portion of term loan - related party, net, and $74.2 million presented as Long-term portion of term loan - related party, net, on the consolidated balance sheet. During the three months ended March 31, 2026, the Company recorded $1,417 thousand in interest expense, which is presented in Interest expense, related party on the consolidated statements of operations and comprehensive loss. The amount due to H-D for interest as of March 31, 2026 and December 31, 2025 was $1,672 thousand and $255 thousand, respectively, and is presented in Other long-term liabilities on the consolidated balance sheet. The effective interest rate was 7.64% as of March 31, 2026 and December 31, 2025. The Company remained in compliance with all of the existing covenants as of March 31, 2026.
As discussed above, on August 22, 2025, LiveWire entered into an At-The-Market Issuance Sales Agreement with Mizuho Securities USA LLC, as agent (the "Agent"), under which LiveWire may offer and sell, from time to time at its sole discretion, an aggregate gross sale price of up to $50.0 million of shares of its common stock through the Agent (the "ATM Program"). LiveWire filed a prospectus supplement with the SEC on August 22, 2025 in connection with the ATM Program. There were no shares of common stock sold under the ATM Program and no commissions during the three months ended March 31, 2026. As of March 31, 2026 and December 31, 2025, there were $382 thousand unamortized issuance costs related to the ATM Program recorded included in Other current assets on the consolidated balance sheet and will be offset against Additional paid-in-capital on a ratable basis as additional proceeds are received under the ATM Program. Additionally, there were $180 thousand in expenses associated with maintaining the ATM Program included in Selling, administrative and engineering expense on the consolidated statements of operations and comprehensive loss for the three months ended March 31, 2026. At March 31, 2026 and December 31, 2025, $47.8 million in capacity remained available under the ATM Program.
Management continues to assess the Company's liquidity position and has the flexibility to adjust spending as needed through cost reduction initiatives in order to preserve liquidity. At the same time, the Company continues to explore additional means for raising capital to continue to support ongoing operations and future investments. Additionally, the Company continues to focus on the development of products that are profitable while reducing its use of cash. Based on its current plans and projections, the Company expects that its current resources will be sufficient to fund its ongoing operations and capital expenditure requirements for at least the next twelve months from the issuance date of these consolidated financial statements. The Company will require additional capital in order to continue to finance its operations and execute its business plan before eventually attaining and maintaining profitable operations. The amount and timing of future funding requirements will depend on many factors, including the pace and results of the Company's product development and sales efforts, as well as timing and size of funds raised under the ATM Program or other financing vehicles.
LiveWire's material contractual operating cash commitments at March 31, 2026 relate to leases. LiveWire estimates capital expenditures to be between $3 million and $8 million in 2026. As a result of the Business Combination completed on September 26, 2022, LiveWire will be subject to certain payments in the event minimum purchase commitments under the Contract Manufacturing Agreement with H-D are not met beginning in the year 2027. The Company also has a liability of $6,080 thousand as of March 31, 2026 and December 31, 2025 thousand for excess inventory components held by H-D that the Company expects to be obligated to reimburse H-D under the terms of the Contract Manufacturing Agreement. Refer to Note 11, Related Party Transactions, for discussion of commitments with H-D.
Cash Flow Activity
The following table presents condensed highlights from the Company's consolidated statements of cash flows for the three months ended March 31, 2026 and 2025 (in thousands):
Three months ended
March 31,
2026 		March 31,
2025
Net cash used by operating activities $ (12,994) $ (17,490)
Net cash used by investing activities (688) (613)
Net cash used by financing activities (1,607) (250)
Effect of exchange rate changes on cash and cash equivalents 7 138
Net change in cash and cash equivalents $ (15,282) $ (18,215)
The overall decrease in cash during the three months ended March 31, 2026 was due primarily to cash used for operating activities.
Operating Activities
The Company had net cash outflow from operating activities during the three months ended March 31, 2026 and 2025. Net cash used by operating activities decreased by $4,496 thousand to $12,994 thousand for the three months ended March 31, 2026 compared to $17,490 thousand for the three months ended March 31, 2025. The decrease in net cash outflow from operating activities was primarily driven by favorable changes in Inventories and Accounts payable and accrued liabilities offset by unfavorable changes in Accounts payable to related party.
Investing Activities
Net cash used by investing activities increased by $75 thousand to $688 thousand for the three months ended March 31, 2026 compared to $613 thousand for the three months ended March 31, 2025 due to an increase in capital expenditures.
Financing Activities
Net cash used by financing activities increased by $1,357 thousand to an outflow of $1,607 thousand for the three months ended March 31, 2026 compared to an outflow of $250 thousand for the three months ended March 31, 2025. The increase in the cash outflow for the three months ended March 31, 2026 is related to the $800 thousand payment of borrowings under the Term Loan, as described in Note 11, Related Party Transactions, and an increase in the amount of repurchases of common stock to satisfy withholding taxes of $557 thousand in connection with the vesting of restricted stock units in 2026.
Critical Accounting Policies and Estimates
There have been no changes to the LiveWire's critical accounting policies and estimates from those described under "Critical Accounting Policies and Estimates" in the Management's Discussion and Analysis of Financial Condition and Results of Operations of the Annual Report on Form 10-K for the year ended December 31, 2025.
Emerging Growth Company Status
Section 102(b)(1) of the Jumpstart Our Business Startups Act of 2012 ("JOBS Act") exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can choose not to take advantage of the extended transition period and comply with the requirements that apply to non-emerging growth companies, and any such election to not take advantage of the extended transition period is irrevocable.
LiveWire is an "emerging growth company" as defined in Section 2(a) of the Securities Act and has elected to take advantage of the benefits of the extended transition period for new or revised financial accounting standards, although it may decide to early adopt such new or revised accounting standards to the extent permitted by such standards. This may make it difficult or impossible to compare LiveWire's financial results with the financial results of another public company that is either not an emerging growth company or is an emerging growth company that has chosen not to take advantage of the extended transition period exemptions because of the potential differences in accounting standards used.
New Accounting Standards Issued But Not Yet Adopted
For a discussion of recent accounting pronouncements, see Note 2, New Accounting Standards, in the consolidated financial statements.
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