What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2026-02-27 compared with 2025-02-27 · 117 added, 127 removed, 714 unchanged (25% of the section changed)

51 unchanged sentences

Selling, general, and administrative expenses 541,484 513,450 470,663

Goodwill impairment charge 56,706 — —

Income from operations 299,547 292,909 214,760

68 unchanged sentences

Issuance of non-vested stock, net of cancellations 93,437 1 1,985 — — 1,986

Other stock-related activity, net of tax ( 18,851 ) — ( 782 ) ( 1,523 ) — ( 2,305 )

Other stock-related activity ( 26,378 ) — ( 1,954 ) ( 590 ) — ( 2,544 )

Other comprehensive loss — — — — 713 713

5 unchanged sentences

Issuance of non-vested stock, net of cancellations 100,778 1 2,120 — — 2,121

Other stock-related activity, net of tax ( 26,378 ) — ( 1,954 ) ( 590 ) — ( 2,544 )

Other stock-related activity ( 23,870 ) — ( 2,237 ) ( 133 ) — ( 2,370 )

Other comprehensive loss — — — — ( 4,185 ) ( 4,185 )

5 unchanged sentences

Issuance of non-vested stock, net of cancellations 165,934 2 2,125 — — 2,127

Other stock-related activity, net of tax ( 23,870 ) — ( 2,237 ) ( 133 ) — ( 2,370 )

Other stock-related activity ( 52,371 ) ( 1 ) ( 6,837 ) — — ( 6,838 )

Other comprehensive loss — — — — 2,254 2,254

12 unchanged sentences

Provision for doubtful accounts 332 90 4,592

Benefit from deferred income taxes ( 10,838 ) ( 2,960 ) ( 5,880 )

Provision (benefit) from deferred income taxes 6,152 ( 10,838 ) ( 2,960 )

Provision for stock-based compensation 19,635 15,012 11,484

Fair value adjustment to contingent consideration — — ( 20,468 )

Payment of contingent consideration — — ( 120 )

Goodwill impairment charge 56,706 — —

Changes in assets and liabilities:

12 unchanged sentences

Cash Flows from Financing Activities:

Proceeds of revolving credit line — — 10,000

Payments of revolving credit line ( 13,960 ) ( 78,800 ) ( 146,600 )

Proceeds of long-term debt — — 500,000

Payments of long-term debt ( 28,125 ) ( 15,625 ) ( 12,500 )

Payment of deferred acquisition consideration — ( 200 ) —

Payment of contingent consideration — — ( 1,705 )

Payment of debt issuance costs — — ( 3,918 )

Proceeds from exercise of stock options 3,697 4,711 1,167

1 unchanged sentence

Other stock-related activity ( 4,710 ) ( 254 ) ( 467 )

Cash (used in) provided by financing activities ( 170,979 ) ( 174,109 ) 472,496

Cash used in financing activities ( 83,689 ) ( 170,979 ) ( 174,109 )

Effect of exchange rate changes on Cash and Cash Equivalents 323 ( 424 ) 32

Net Increase (Decrease) in Cash and Cash Equivalents 20,323 ( 9,220 ) ( 12,748 )

Net (Decrease) increase in Cash and Cash Equivalents ( 7,701 ) 20,323 ( 9,220 )

Cash and Cash Equivalents, Beginning of Period 57,137 36,814 46,034

2 unchanged sentences

Cash paid for interest expense $ 27,363 $ 38,713 $ 49,507

Cash paid for income taxes $ 56,705 $ 35,465 $ 62,861

Cash paid for income taxes, net of amount refunded $ 68,632 $ 56,705 $ 35,465

See accompanying Notes to Consolidated Financial Statements.

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We consider all highly liquid short-term investments with original maturities of three months or less to be cash equivalents.

Sales of Accounts Receivable .

Accounts Receivable.

Accounts receivable from our customers are presented net of an allowance for expected credit losses.

The allowance is established based on factors including the age of receivable balances, historical loss experience, and specific facts and circumstances.

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.

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Long-Lived Assets Including Goodwill and Other Acquired Intangible Assets .

Long-lived assets, including property, plant, and equipment and amortizable identifiable intangibles, are reviewed for impairment

whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable.

Long-lived assets, including property, plant, and equipment and amortizable identifiable intangibles, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable.

The impairment review is a two-step process.

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Goodwill is reviewed for impairment on an annual basis or whenever events or changes in circumstances indicate the carrying value of the goodwill may be impaired.

The Company has historically performed its annual goodwill impairment assessment as of the last day of the fiscal month of October.

During 2025, the Company changed the date of its annual impairment assessment from the last day of the fiscal month of October to the first day of the fiscal fourth quarter.

The change was made to more closely align the impairment assessment date with the Company’s planning and forecasting processes.

For the annual test, we have the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount (“Step 0”).

1 unchanged sentence

During 2025 and 2024, we elected to perform a Step 1 test of our goodwill for the purpose of assessing goodwill for impairment.

For both the years ended December 31, 2024 and 2023, we determined that goodwill was not impaired.

Purchase Accounting .

The purchase price of an acquired business is allocated to the underlying tangible and intangible assets acquired and liabilities assumed based on their respective fair market values, with the excess recorded as goodwill.

Such fair market value assessments require judgments and estimates which may change over time and may cause the final amounts to differ materially from their original estimates.

These adjustments to fair value assessments are recorded to goodwill over the purchase price allocation period which cannot exceed 12 months from the date of acquisition.

For the year ended December 31, 2025, we determined that the carrying value of our Heavy Duty reporting unit exceeded its fair value, and therefore recorded an impairment charge of $ 56.7 million during the fourth quarter, representing the balance of goodwill in that reporting unit.

For the year ended December 31, 2024, we determined that goodwill was not impaired at that time.

Refer to Note 5, "Goodwill and Intangible Assets," for additional information.

Other Assets .

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The total book value of these investments was $ 12.3 million and $ 11.2 million at December 31, 2025, and 2024, respectively.

These investments provided $ 5.3 million, $ 5.7 million, and $ 5.5 million of income during the year ended December 31, 2024, 2023, and 2022, respectively.

These investments provided $ 4.1 million, $ 5.3 million, and $ 5.7 million of income during the years ended December 31, 2025, 2024, and 2023, respectively.

Additionally, we have an investment that we account for according to the cost method of accounting.

13 unchanged sentences

We charge a core deposit to encourage the customer to return the used core to us so that it can be used in our remanufacturing process.

We allow our customers up to twenty-four months to return the used core to us.

We allow our customers up to 24 months to return the used core to us.

Core return deposits are reserved based on the expected deposits to be issued to customers based on historical returns.

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A significant percentage of our accounts receivable have been, and will continue to be, concentrated among a relatively small number of automotive retailers and warehouse distributors in the United States.

Our 4 largest customers accounted for 78 % and 74 % of net accounts receivable as of December 31, 2024 and 2023, respectively.

Our four largest customers accounted for

78 % of net accounts receivable as of both December 31, 2025, and 2024.

We continually monitor the credit terms and credit limits for these and other customers.

2 unchanged sentences

Fair Value Disclosures .

The carrying value of financial instruments such as cash and cash equivalents, accounts receivable, accounts payable, and other current assets and liabilities approximate their fair value based on the short-term nature of these instruments.

The carrying value of financial instruments, such as cash and cash equivalents, accounts receivable, accounts payable, and other current assets and liabilities, approximates their fair value based on the short-term nature of these instruments.

The carrying value of our long-term debt approximates its fair value because it bears interest at a rate indexed to a market rate ("Term SOFR").

Additionally, the fair value of assets acquired and liabilities assumed are determined at the date of acquisition.

Contingent consideration

associated with an acquisition is recorded at fair value at the acquisition date and is adjusted to fair value at each reporting period.

Additionally, the fair values of assets acquired and liabilities assumed are determined at the date of acquisition.

Contingent consideration associated with an acquisition is recorded at fair value at the acquisition date and is adjusted to fair value at each reporting period.

Recent Accounting Pronouncements.

In November 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-07, Improvements to Reportable Segment Disclosures.

The ASU requires additional disclosures about reportable segments’ significant expenses on an interim and annual basis.

The ASU was effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024 on a retrospective basis.

We adopted this guidance for our annual report on Form 10-K for the year ended December 31, 2024 and applied the amendments retrospectively to all prior periods presented.

The disclosures for interim periods will be adopted in our fiscal year beginning on January 1, 2025.

The adoption of this standard did not have a material impact on our results of operations or financial condition.

See Note 8, "Segment Information," for further details on segment information.

In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures.

The ASU expands disclosures in the income tax rate reconciliations table and cash taxes paid and is effective for annual periods beginning after December 15, 2024.

In December 2023, the Financial Accounting Standards Board ("FASB") issued ASU 2023-09, Improvements to Income Tax Disclosures.

The ASU expands disclosures in the income tax rate reconciliations table and cash taxes paid.

We adopted this guidance effective as of December 31, 2025, on a retrospective basis.

The adoption of this standard had no material impact on our results of operations, financial condition, or cash flows.

Refer to Note 9 "Income Taxes," for the additional disclosures required under this standard.

In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses.

1 unchanged sentence

The updated guidance is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027.

We expect to implement these new standards by their effective dates, and do not expect their adoption to have an impact on our results of operations, financial condition or cash flows.

Business Acquisitions and Investments

Super ATV, LLC (“SuperATV”)

On October 4, 2022, Dorman acquired 100 % of the issued and outstanding equity interests of SuperATV (the “Transaction”), for aggregate consideration of $ 509.8 million (net of $ 6.8 million cash acquired), plus a potential earn-out payment to the sellers of SuperATV not to exceed $ 100 million in the aggregate, subject to the achievement by SuperATV of certain revenue and gross margin targets in the years ended December 31, 2023 and December 31, 2024.

See Note 11, "Commitments and Contingencies," for additional information on contingent consideration associated with the Transaction.

In the year ended December 31, 2023, we received $ 0.3 million in cash as proceeds from the closing net working capital adjustments.

SuperATV is 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.

The Transaction was funded in cash through the refinancing of our existing credit facility discussed further in Note 7, "Long-Term Debt."

The Transaction was accounted for as a business combination under the acquisition method of accounting.

We have allocated the purchase price to tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values.

Our purchase price allocation for SuperATV assets acquired and liabilities assumed was complete as of September 30, 2023.

The table below details the fair values of the assets acquired and the liabilities assumed at the acquisition date:

(in thousands)

Accounts receivable $ 3,317

Inventories 90,428

Prepaids and other current assets 5,293

Property, plant and equipment 23,776

Goodwill 247,474

Identifiable intangible assets 157,500

Operating lease right-of-use assets 11,661

Other Assets 3,001

Accounts payable ( 7,436 )

Accrued compensation ( 2,086 )

Accrued customer rebates and returns ( 1,609 )

Other current liabilities ( 8,726 )

Long-term operating lease liabilities ( 9,508 )

Other long-term liabilities ( 3,307 )

Net cash consideration 509,778

The financial results of the Transaction have been included in the consolidated financial statements from the date of acquisition.

The net sales and net income of SuperATV included in the consolidated financial statements for the year ended December 31, 2022 were $ 49.6 million and $ 2.3 million, respectively.

The unaudited pro forma information for the periods set forth below gives effect to the Transaction as if it had occurred as of December 26, 2021 the beginning of the fiscal 2022 period.

The pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that would have been achieved had the acquisition been consummated as of that time.

For the Year Ended

(in thousands, except per share data, unaudited) December 31, 2022

Net sales $ 1,888,379

Net income $ 130,375

Diluted earnings per share $ 4.13

The fiscal 2022 unaudited pro forma net income set forth above was adjusted to exclude the impact of acquisition date fair value adjustments to inventory and to remove acquisition-related transaction costs.

We expect to implement this new standard by its effective date, and do not anticipate that its adoption will have an impact on our results of operations, financial condition, or cash flows.

Inventories were as follows:

13 unchanged sentences

Total 475,294 436,815

Less-accumulated depreciation and amortization ( 272,316 ) ( 240,638 )

accumulated depreciation and amortization ( 306,517 ) ( 272,316 )

Property, plant, and equipment, net $ 168,777 $ 164,499

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We have made certain accounting policy elections and are using certain practical expedients permitted under GAAP, as follows:

• Include both lease and non-lease components as a single lease component, as non-lease components of contracts have not historically been material.

• Account for leases with terms of one year or less as short-term leases and, as such, are not included in the right-of-use assets or lease liabilities.

• Including both lease and non-lease components as a single lease component, as non-lease components of contracts have not historically been material.

• Accounting for leases with terms of one year or less as short-term leases and, as such, they are not included in the right-of-use assets or lease liabilities.

As of December 31, 2025, and 2024, there were no material variable lease costs or sublease income.

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Balance at December 31, 2023 $ 313,704 $ 57,876 $ 72,309 $ 443,889

Measurement period adjustments — — — 233

Goodwill acquired — — 1,167 1,167

Foreign currency translation — ( 2,170 ) — ( 2,170 )

Reporting unit reorganization 313,704 57,876 72,309 —

Balance at December 31, 2024 313,704 55,706 73,476 442,886

Goodwill acquired — — 1,167 1,167

Measurement period adjustment — — 154 154

Foreign currency translation — 1,000 — 1,000

Goodwill impairment charge — ( 56,706 ) — ( 56,706 )

Balance at December 31, 2025 (1)

$ 313,704 $ — $ 73,630 $ 387,334

(1) Accumulated impairment losses were $ 56.7 million as of December 31, 2025, all within the Heavy-Duty segment.

As discussed in Note 1, "Summary of Significant Accounting Policies", to the Consolidated Financial Statements, we perform our annual goodwill impairment analysis in the fourth quarter of each year.

We determined fair values for each of the reporting units using a combination of the income approach and market approach.

Under the income approach, fair value is determined based on the present value of estimated future cash flows, discounted using a risk-adjusted rate.

We use our internal forecasts to estimate future cash flows and

include an estimate of long-term future growth rates based on our expectation for the long-term outlook for each business.

Actual future results may differ materially from those assumed in our forecasts.

We derive our discount rates using a capital asset pricing model and analyze published rates for industries relevant to our reporting units to estimate the cost of equity financing.

We use discount rates that are commensurate with the risks and uncertainty inherent in the respective businesses and in our internally developed forecasts.

Discount rates used in our annual reporting unit valuations for the year ended December 31, 2025, ranged from 11.5 % to 14.5 %.

Under the market approach, metrics of publicly traded companies of comparable businesses are utilized.

The selection of comparable businesses is based on the markets in which the reporting units operate, giving consideration to their risk profiles, size, geography, and diversity of products and services.

Based on the results of our annual impairment test, the fair values of each of our reporting units exceeded their carrying values except for the Heavy Duty reporting unit.

Our forecasted future cash flows in the Heavy Duty reporting unit have continued to deteriorate, driven by the continued market pressures that have persisted across the heavy-duty trucking industry domestically.

These challenges resulted in downward revisions to our projected earnings and cash flow forecasts within our Heavy Duty business.

As a result, we recorded an impairment charge of $ 56.7 million, representing the balance of goodwill in our Heavy Duty reporting unit as of the measurement date.

Intangible Assets

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The CODM uses income from operations to assess segment performance.

The CODM utilizes this measure for each segment in the annual budget and forecasting cycles and considers performance against established targets for purposes of allocating Company resources to each segment and in the determination of compensation for certain Contributors.

We measure segment income from operations based on income from operations excluding acquisition-related intangible assets amortization, acquisition-related transaction and other costs, and other special charges.

43 unchanged sentences

Pretax reduction in workforce costs ( 147 ) ( 4,973 ) —

Goodwill impairment charge ( 56,706 ) — —

Interest expense, net ( 28,575 ) ( 39,727 ) ( 48,061 )

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The Lewisberry lease expires December 31, 2027.

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.

Each lease is a non-cancelable operating lease, was renewed in October 2022 in connection with the acquisition of Super ATV, LLC, a leading supplier to the powersports aftermarket ("SuperATV"), and will expire on October 31, 2027.

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We are a partner in a joint venture with one of our suppliers and own a minority interest in two other suppliers.

Aggregate purchases from both of these companies were $ 18.4 million, $ 22.7 million, and $ 24.9 million in the years ended December 31, 2024, 2023, and 2022, respectively.

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.

The components of the provision for income taxes are as follows:

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Provision for income taxes $ 71,251 $ 66,248 $ 39,244

The following is a reconciliation of income taxes at the statutory tax rate to the Company's effective tax rate:

A reconciliation of the provision for income taxes to the amount computed by applying the 21% statutory U.S.

federal income tax rate to income before income taxes after the adoption of ASU 2023-09 is as follows:

For the Year Ended December 31,

(in thousands, except percentage data) 2025 2024 2023

U.S federal statutory tax rate $ 57,843 21.0 % $ 53,813 21.0 % $ 35,386 21.0 %

State and local income tax, net of federal income tax effect (1)

7,159 2.6 % 6,219 2.4 % 3,255 1.9 %

Federal taxes at statutory rate 21.0 % 21.0 % 21.0 %

State taxes, net of federal tax benefit 2.4 2.1 2.5

Uncertain tax positions 2.9 0.2 0.3

Research and development tax credit ( 0.5 ) ( 0.7 ) ( 0.7 )

Federal permanent items — 0.3 ( 0.2 )

Effect of foreign operations 0.1 0.3 —

Foreign tax effects 1,298 0.5 % 311 0.1 % 550 0.3 %

Effect of cross-border tax laws ( 979 ) ( 0.4 ) % ( 891 ) ( 0.3 ) % ( 380 ) ( 0.2 ) %

Tax credits ( 1,450 ) ( 0.5 ) % ( 1,584 ) ( 0.6 ) % ( 1,304 ) ( 0.8 ) %

Nontaxable or nondeductible items:

Goodwill impairment charge 5,845 2.1 % — — % — — %

Other 1,099 0.4 % 813 0.3 % 825 0.5 %

Changes in unrecognized tax benefits 741 0.3 % 7,497 2.9 % 598 0.4 %

Other adjustments ( 305 ) ( 0.1 ) % 70 0.1 % 314 0.2 %

Effective tax rate $ 71,251 25.9 % $ 66,248 25.9 % $ 39,244 23.3 %

(1) The state and local jurisdictions that contribute to the majority (greater than 50%) of the tax effect in this category include California, Pennsylvania and Tennessee.

The amounts of cash income taxes paid were as follows:

(in thousands) For the Year Ended December 31,

2025 2024 2023

Federal $ 56,700 $ 50,195 $ 27,022

State and local 10,064 4,859 6,926

Foreign 1,868 1,651 1,517

Income taxes paid, net of amounts refunded $ 68,632 $ 56,705 $ 35,465

No state and local or foreign jurisdictions exceeded 5 percent of total income taxes paid (net of refunds) in any period presented.

At December 31, 2025, we had $ 10.5 million of unrecognized tax benefits, all of which would affect our effective tax rate if recognized.

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We recognize interest and penalties related to unrecognized tax benefits in income tax expense.

The total amount of interest and penalties related to unrecognized tax benefits recorded within tax expense was $ 3.1 million for the year ended December 31, 2024, and was immaterial for the year ended December 31, 2023.

The total amount of interest and penalties related to unrecognized tax benefits recorded within tax expense was $ 0.7 million and $ 3.1 million for the years ended December 31, 2025, and 2024, respectively.

As of December 31, 2025, accrued interest and penalties related to unrecognized tax benefits were $ 4.2 million.

The Company does not anticipate material changes in the amount of unrecognized income tax benefits over the next year.

Deferred income taxes result from timing differences in the recognition of revenue and expense between tax and financial statement purposes.

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Management has determined it was necessary to establish a valuation allowance against the foreign tax credits, various state tax credits, and a capital loss carryforward.

Based on our history of taxable income and our projection of future earnings, we believe that it is more likely than not that sufficient taxable income will be generated in the foreseeable future to realize the remaining net deferred tax assets.

During 2024, we increased the valuation allowance against the deferred tax assets noted above by an immaterial amount.

As of December 31, 2024, the Company has tax-effected net operating loss carryforwards of $ 0.2 million and $ 0.1 million for U.S.

federal and state jurisdictions, respectively.

Tax-effected federal net operating losses of $ 0.1 million begin to expire in 2036 .

The remaining federal net operating losses do not expire.

The state net operating loss carryforwards expire in various years starting in 2037 .

During 2025, we decreased the valuation allowance against the deferred tax assets noted above by an immaterial amount.

We file income tax returns in the United States, Canada, China, India, and Mexico.

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Acquisitions.

We have contingent consideration related to prior acquisitions due to the uncertainty of the ultimate amount of any payments that will become due as earnout payments if performance targets are achieved.

If the remaining performance targets for the acquisitions are fully achieved, the maximum additional contingent payments to be made under the transaction documents would be $ 102.0 million in the aggregate.

As of December 31, 2024 and December 31, 2023, we estimated that zero payments are expected to become due in connection with the acquisitions, and therefore accrued no liability.

We have contingent consideration related to a prior acquisition due to the uncertainty of the ultimate amount of any payments that will become due as earnout payments if performance targets are achieved.

If the remaining performance targets for the acquisition are fully achieved, the maximum additional contingent payments to be made under the transaction documents would be $ 2.0 million in the aggregate.

As of December 31, 2025, and December 31, 2024, we estimated that zero payments are expected to become due in connection with the acquisition, and therefore accrued no liability.

For the year ended December 31, 2023, we recorded a net decrease of $ 20.0 million to the contingent consideration liability for a prior acquisition, comprising a $ 20.5 million decrease in fair value based on the modeling of a range of performance outcomes relative to the achievement of targets established in the purchase agreement, partially offset by $ 0.5 million of accretion on the liability resulting from the passage of time.

The net benefit was included in selling, general and administrative expenses in the Condensed Consolidated Statements of Operations.

For the year ended December 31, 2022, we recorded a charge of $ 1.8 million in connection with earnout provisions under a prior acquisition, with the charge included in selling, general and administrative expenses in the Condensed Consolidated Statements of Operations.

During the year ended December 31, 2022, we paid $ 1.8 million to fully settle this earnout provision associated with the prior acquisition.

The net benefit was included in selling, general, and administrative expenses in the Condensed Consolidated Statements of Operations and Comprehensive Income.

Other Contingencies .

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In most instances, our contract with a customer is the customer’s purchase order.

Upon acceptance of the purchase order, a contract exists with a customer, as a sales agreement indicates the approval and commitment of the parties, identifies the rights of both parties, identifies the payment terms, and has commercial substance.

Upon acceptance of the purchase

order, a contract exists with a customer, as a sales agreement indicates the approval and commitment of the parties, identifies the rights of both parties, identifies the payment terms, and has commercial substance.

At this point, we believe it is probable that we will collect the consideration to which we will be entitled in exchange for the goods transferred to the customer.

For certain customers, we may also enter into a sales agreement that outlines pricing considerations as well as the framework of terms and conditions that apply to future purchase orders for that customer.

In these situations, our contract with the customer is both the sales agreement as well as the specific customer purchase

In these situations, our contract with the customer is both the sales agreement as well as the specific customer purchase order.

As our contract with a customer is typically for a single transaction or customer purchase order, the duration of the contract is typically one year or less.

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We have concluded that our estimates of variable consideration are not constrained according to the definition in the standard.

All of our revenue was recognized under the point-of-time approach during the years ended December 31, 2024, 2023, and 2022.

All of our revenue was recognized under the point-in-time approach during the years ended December 31, 2025, 2024, and 2023.

Also, we do not have significant financing arrangements with our customers.

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Net Sales $ 2,130,319 $ 2,009,197 $ 1,929,788

During the year ended December 31, 2024, two customers each accounted for more than 10% of net sales, and for the years ended December 31, 2023 and 2022, three customers each accounted for more than 10% of net sales.

In the aggregate, these customers accounted for 39 %, 44 %, and 49 % of net sales in the years ended December 31, 2024, 2023, and 2022, respectively.

During the years ended December 31, 2025, and December 31, 2024, two customers each accounted for more than 10% of net sales, and in the aggregate, these two customers accounted for 40 % and 39 % of net sales, respectively.

For the year ended December 31, 2023, three customers each accounted for more than 10% of net sales, and in the aggregate, these three customers accounted for 44 % of net sales.

Sales to these customers are included in the Light Duty segment.

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Prior to May 16, 2018, we issued stock compensation grants under our 2008 Stock Option and Stock Incentive Plan.

On May 16, 2018 , our shareholders approved our 2018 Stock Option and Stock Incentive Plan (the “2018 Plan” or the “Plan”), which supersedes our 2008 Stock Option and Stock Incentive Plan.

All future stock compensation grants will be issued under the 2018 Plan.

On May 16, 2018 , our shareholders approved our 2018 Stock Option and Stock Incentive Plan (the “2018 Plan” or the “Plan”), which superseded our 2008 Stock Option and Stock Incentive Plan.

Under the terms of the Plan, our Board of Directors may grant up to 1,200,000 shares of common stock in the form of shares of restricted stock, restricted stock units, stock appreciation rights, and stock options, or combinations thereof, to officers, directors, employees, consultants, and advisors.

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Compensation cost related to those performance-based RSAs was recognized over the performance period and was calculated using the closing price per share of our common stock on the grant date and an estimate of the probable outcome of the performance conditions as of the reporting date.

In 2019, we introduced performance-based RSAs that vest based on our total shareholder return ranking relative to the S&P Mid-Cap 400 Growth Index over a three-year performance period (market condition).

For those awards containing a market condition, compensation cost is recognized on a straight-line basis over the performance period and is calculated using the simulated fair value per share of our common stock based on the application of a Monte Carlo simulation model.

This valuation technique includes estimating the movement of stock prices and the effects of volatility, interest rates, and dividends.

We issue RSUs to certain employees and members of our Board of Directors.

For time-based RSUs, compensation cost is recognized on a straight-line basis over the vesting period and is calculated using the closing price per share of our common stock on the grant date.

Performance-based RSUs granted starting in the year ended December 31, 2024 included certain grants that vest based on our total shareholder return ranking relative to the Nasdaq US Benchmark Auto Parts Index over a three-year performance period (market condition), and other grants that vest based upon achievement of return on invested capital targets over a three-year performance period (performance condition).

For performance-based RSUs with a market condition, compensation cost is recognized on a straight-line basis over the performance period and is calculated using the simulated fair value per share of our common

stock based on the application of a Monte Carlo simulation model as discussed in the paragraph above.

Performance-based RSUs that were granted in 2020 through 2023 vest based on our total shareholder return ranking relative to the S&P Mid-Cap 400 Growth Index over a three-year performance period (market condition).

Beginning in the year ended December 31, 2024, performance-based RSUs included certain grants that vest based on our total shareholder return ranking relative to the Nasdaq US Benchmark Auto Parts Index over a three-year performance period (market condition), and other grants that vest based upon achievement of return on invested capital targets over a three-year performance period (performance condition).

This valuation technique includes estimating the movement of stock prices and the effects of volatility, interest rates, and dividends.

For performance-based RSUs with a performance condition, compensation cost is recognized over the performance period and is calculated using the closing price per share of our common stock on the grant date and an estimate of the probable outcome of the performance conditions as of the reporting date.

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Treasury security with terms equal to the expected time of exercise as of the grant date.

There were no stock options granted in 2024.

There were no stock options granted in 2025 or 2024.

The following table summarizes the weighted-average valuation assumptions used to calculate the fair value of options granted and the associated weighted-average grant-date fair values:

3 unchanged sentences

Risk-free interest rate 4.3 %

Expected life of options 5.3 years 5.3 years

Expected life of options 5.3 years

Weighted-average grant-date fair value $ 35.93

8 unchanged sentences

Exercised ( 24,297 ) $ 61.68 – $ 82.94

Expired ( 7,488 ) $ 81.91 – $ 101.45

Canceled ( 4,521 ) $ 82.94 – $ 101.45

Balance at December 31, 2023 311,217 $ 61.68 – $ 111.53

Granted 79,404 $ 86.63 – $ 91.28

Exercised ( 65,180 ) $ 61.68 – $ 111.53

4 unchanged sentences

Expired ( 3,352 ) $ 86.71 – $ 96.36

Canceled ( 4,520 ) $ 91.28 – $ 101.45

Balance at December 31, 2025 191,677 $ 61.68 – $ 111.53

8 unchanged sentences

Employee Stock Purchase Plan (the “ESPP”), which makes available 1,000,000 shares of our common stock for sale to eligible employees.

The purpose of the ESPP, which is qualified under Section 423 of the Internal Revenue Service Code of 1986, as amended, is to encourage stock ownership through payroll deductions and limited cash contributions by our employees.

The purpose of the ESPP, which is qualified under Section 423 of the Internal Revenue Code of 1986, as amended, is to encourage stock ownership through payroll deductions and limited cash contributions by our employees.

These contributions are used to purchase shares of the Company’s common stock at a 15 % discount from the lower of the market price at the beginning or end of the purchase window.

18 unchanged sentences

Under that program, and subsequent authorizations (the “Existing Program”), the Board authorized the repurchase of up to $ 600 million of our outstanding common stock through December 31, 2024.

At December 31, 2024, $ 134.6 million was available for repurchase under this program.

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.

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”).

The New Program will operate just as the Existing Program had operated in that share repurchases may be made from time to time depending on market conditions, share price, share availability, and other factors at the Company’s discretion.

The New Program, similar to the Existing Program, will not obligate the Company to acquire any specific number of shares.

At December 31, 2025, $ 459.4 million was available for repurchase under the New Program.

The New Program operates just as the Existing Program had operated in that share repurchases may be made from time to time, depending on market conditions, share price, share availability, and other factors at the Company’s discretion.

The New Program, similar to the Existing Program, does not obligate the Company to acquire any specific number of shares.

The following table summarizes the repurchase and cancellation of common stock :

5 unchanged sentences

401(k) Retirement Plans .

We have a 401(k) plan that cover substantially all of our employees as of December 31, 2024.

We have a 401(k) plan that covers substantially all of our employees as of December 31, 2025.

Annual company contributions are discretionary in nature, in accordance with the

16 unchanged sentences

Diluted $ 6.64 $ 6.14 $ 4.10

Subsequent Events (Unaudited)

On February 20, 2026, the U.S.

Supreme Court ruled that the International Emergency Economic Powers Act (“IEEPA”) does not authorize the President of the U.S.

to impose tariffs, thereby invalidating prior IEEPA-based tariff programs previously announced by the current U.S.

Administration.

Following the decision, the President issued an Executive Order directing that the collection of such IEEPA-based duties end “as soon as practicable.”

Although the Supreme Court ruling may allow importers to claim refunds of such previously paid IEEPA-related duties, no refund mechanism has been established, and recovery may require administrative proceedings or litigation, with timing and outcomes uncertain.

On the same date, the U.S.

Administration announced new temporary global tariffs under Section 122 of the Trade Act of 1974 to take effect February 24, 2026.

The Company is assessing the effects of these developments.

No asset or gain related to potential tariff refunds has been recognized due to uncertainty regarding eligibility, amount, and timing.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data