Joe Nolan

Joe Nolan inquired about the acceleration in public infrastructure contract awards, asking for a breakdown in key markets and details on fiscal year 2026 DOT budgets.

Answer

Tom Hill, Chairman and CEO, stated public demand is widespread and improving, with state DOTs maturing into increased federal and state funding. All top 10 DOTs are up for FY2026, and only 40% of IIJA funds have been spent, indicating a long tail. Ronnie Pruitt, COO, added that reauthorization historically results in larger bills, ensuring continued public strength.

Joe Nolan inquired about the drivers of growth in the Fitness business, specifically regarding advanced wearables and any updates on new user growth. He also asked if the Q4 promotional environment for the holiday season is expected to be comparable to last year.

Answer

President and CEO Cliff Pemble stated that Fitness growth was seen across both running and advanced wellness products, with strong double-digit growth in registrations and new products year-over-year, primarily driven by new users. He expects the Q4 promotional environment to be comparable to previous years, with strong promotions planned across a broad product offering.

Joe Nolan asked about the drivers of growth in the fitness business, specifically advanced wearables, and an update on new user growth. He also inquired if the Q4 promotional environment is expected to be comparable to last year, and any associated puts and takes.

Answer

Cliff Pemble, President and CEO, indicated growth across both running and advanced wellness products in fitness, with strong double-digit growth in new user registrations across all wearables, primarily from new users. He stated that the Q4 promotional environment is expected to be comparable to previous years, with strong promotions planned across a broad product lineup.

Joe Nolan inquired about the success of the Polaris Factory Authorized Clearance (FAC) program, seeking an update on promotional activity from competitors and how that might evolve into Q4 and 2026. He also asked for an update on competitor channel inventories.

Answer

CEO Mike Speetzen stated that Polaris and its next largest competitor have similar DSOs and current/non-current inventory levels, which is beneficial for the industry. He noted that Japanese competitors are moving in the right direction, with large, one-time promotional incentives largely slowing down or exiting the market. Speetzen expects the promotional environment to remain relatively flat year-over-year into 2026, assuming dealer inventories continue to improve across competitors. CFO Bob Mack added that while there's talk of lower promo, behaviors haven't demonstrated it yet, and current views suggest promo will remain flat, with potential normalization in mid-2026 if interest rates decline.