Operating margins have collapsed to -3.3% in 2026Q1, reflecting structural inefficiencies and persistent promotional discounting that continue to pressure the company's 20.2% gross margin.
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 | Dec'17 | Dec'16 | Dec'15 | Dec'14 | Dec'13 | Dec'12 | Dec'11 | Dec'10 | Dec'09 | Dec'08 | Dec'07 | Dec'06 | Dec'05 | Dec'04 | Dec'03 | Dec'02 | Dec'01 | Dec'00 | Dec'99 | Dec'98 | Dec'97 | Dec'96 |
|---|
| Sales/Revenue | 7.27B | 7.15B | 7.18B | 8.93B | 8.59B | 7.44B | 7.03B | 6.78B | 6.08B | 5.43B | 4.52B | 4.72B | 4.48B | 3.78B | 3.21B | 2.66B | 1.99B | 1.57B | 1.95B | 1.78B | 1.66B | 1.87B | 1.77B | 1.61B | 1.52B | 1.51B | 1.43B | 1.32B | 1.18B | 1.05B | 1.19B |
| Revenue Growth % | 4.3% | -0.33% | -19.69% | 4.02% | 15.46% | 5.85% | 3.62% | 11.58% | 11.98% | 20.19% | -4.29% | 5.35% | 18.6% | 17.67% | 20.81% | 33.44% | 27.16% | -19.63% | 9.45% | 7.45% | -11.41% | 5.45% | 10.42% | 5.56% | 0.61% | 6.06% | 7.92% | 12.39% | 12.13% | -12.05% | 7% |
| Cost of Goods Sold | 5.85B | 5.83B | 5.77B | 7.03B | 6.68B | 5.74B | 5.4B | 5.21B | 4.65B | 4.02B | 3.41B | 3.38B | 3.16B | 2.66B | 2.28B | 1.92B | 1.46B | 1.17B | 1.5B | 1.39B | 1.3B | 1.46B | 1.35B | 1.25B | 1.19B | 1.17B | 1.05B | 953.5M | 861M | 752.6M | 925.8M |
| COGS % of Revenue | - | 81.48% | 80.43% | 78.67% | 77.78% | 77.19% | 76.85% | 76.82% | 76.55% | 74.06% | 75.59% | 71.66% | 70.45% | 70.33% | 71.16% | 72.08% | 73.37% | 74.89% | 77.12% | 77.92% | 78.31% | 78.02% | 76.07% | 77.58% | 78.16% | 77.22% | 73.69% | 72.17% | 73.25% | 71.79% | 77.67% |
| Gross Profit | 1.43B | 1.32B | 1.4B | 1.91B | 1.91B | 1.7B | 1.63B | 1.57B | 1.43B | 1.41B | 1.1B | 1.34B | 1.32B | 1.12B | 925.7M | 741.88M | 530.21M | 393.22M | 445.71M | 393.02M | 359.36M | 411.03M | 424.26M | 360.02M | 332.28M | 344.37M | 375.1M | 367.6M | 314.5M | 295.7M | 266.1M |
| Gross Margin % | 19.64% | 18.52% | 19.57% | 21.33% | 22.22% | 22.81% | 23.15% | 23.18% | 23.45% | 25.94% | 24.41% | 28.34% | 29.55% | 29.67% | 28.84% | 27.92% | 26.63% | 25.11% | 22.88% | 22.08% | 21.69% | 21.98% | 23.93% | 22.42% | 21.84% | 22.78% | 26.31% | 27.83% | 26.75% | 28.21% | 22.33% |
| Gross Profit Growth % | - | -5.65% | -26.34% | -0.12% | 12.47% | 4.29% | 3.46% | 10.33% | 1.2% | 27.75% | -17.57% | 1.03% | 18.12% | 21.07% | 24.78% | 39.92% | 34.84% | -11.78% | 13.41% | 9.37% | -12.57% | -3.12% | 17.85% | 8.35% | -3.51% | -8.19% | 2.04% | 16.88% | 6.36% | 11.12% | 6.02% |
| Operating Expenses | 1.46B | 1.35B | 1.18B | 1.28B | 1.15B | 1.04B | 1.11B | 1.17B | 1.03B | 1.01B | 833.8M | 692.21M | 666.15M | 588.87M | 480.79M | 414.75M | 326.35M | 245.32M | 284.11M | 262.27M | 238.36M | 206.02M | 244.66M | 193.3M | 179.35M | 214.56M | 253.31M | 254M | 214.4M | 202.6M | 168.7M |
| OpEx % of Revenue | - | 18.92% | 16.49% | 14.29% | 13.44% | 13.97% | 15.84% | 17.26% | 16.88% | 18.57% | 18.46% | 14.67% | 14.87% | 15.59% | 14.98% | 15.61% | 16.39% | 15.67% | 14.58% | 14.73% | 14.39% | 11.02% | 13.8% | 12.04% | 11.79% | 14.19% | 17.77% | 19.23% | 18.24% | 19.33% | 14.15% |
| Selling, General & Admin | 1.06B | 981M | 846.6M | 902.5M | 787.5M | 710.2M | 817.7M | 877.52M | 661.18M | 624.1M | 453.68M | 452.03M | 517.7M | 449.67M | 353.43M | 309.12M | 241.41M | 182.32M | 206.64M | 188.68M | 164.47M | 173.68M | 183.96M | 165.12M | 148.44M | 178.85M | 173.95M | 183.4M | 149.8M | 169.4M | 138.1M |
| SG&A % of Revenue | - | 13.72% | 11.8% | 10.1% | 9.17% | 9.55% | 11.64% | 12.94% | 10.88% | 11.5% | 10.04% | 9.58% | 11.56% | 11.91% | 11.01% | 11.63% | 12.12% | 11.64% | 10.61% | 10.6% | 9.93% | 9.29% | 10.37% | 10.28% | 9.76% | 11.83% | 12.2% | 13.88% | 12.74% | 16.16% | 11.59% |
| Research & Development | 371.3M | 371.9M | 336.9M | 374.3M | 366.7M | 328.7M | 295.6M | 292.94M | 259.68M | 238.3M | 185.13M | 166.46M | 148.46M | 139.19M | 127.36M | 105.63M | 84.94M | 63M | 77.47M | 73.59M | 73.89M | 70.98M | 60.7M | 51.76M | 45.55M | 35.71M | 32.36M | 31.3M | 28.4M | 0 | 0 |
| R&D % of Revenue | - | 5.2% | 4.7% | 4.19% | 4.27% | 4.42% | 4.21% | 4.32% | 4.27% | 4.39% | 4.1% | 3.53% | 3.31% | 3.69% | 3.97% | 3.98% | 4.27% | 4.02% | 3.98% | 4.13% | 4.46% | 3.8% | 3.42% | 3.22% | 2.99% | 2.36% | 2.27% | 2.37% | 2.42% | - | - |
| Other Operating Expenses | 1000K | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 105.02M | 145.71M | 195M | 73.72M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -38.64M | 0 | -23.59M | -14.64M | 0 | 47M | 39.3M | 36.2M | 33.2M | 30.6M |
| Operating Income | -34.7M | -28.3M | 220.4M | 629.2M | 754M | 657.7M | 513.5M | 401.89M | 399.3M | 400.2M | 268.62M | 645.28M | 657.67M | 531.91M | 444.91M | 327.13M | 203.87M | 147.9M | 161.59M | 130.75M | 121M | 205.01M | 179.6M | 166.72M | 152.93M | 129.82M | 121.79M | 113.6M | 100.1M | 93.1M | 97.4M |
| Operating Margin % | -0.48% | -0.4% | 3.07% | 7.04% | 8.78% | 8.84% | 7.31% | 5.93% | 6.57% | 7.37% | 5.95% | 13.67% | 14.68% | 14.08% | 13.86% | 12.31% | 10.24% | 9.45% | 8.29% | 7.35% | 7.3% | 10.96% | 10.13% | 10.38% | 10.05% | 8.59% | 8.54% | 8.6% | 8.52% | 8.88% | 8.17% |
| Operating Income Growth % | - | -112.84% | -64.97% | -16.55% | 14.64% | 28.08% | 27.77% | 0.65% | -0.22% | 48.98% | -58.37% | -1.88% | 23.64% | 19.56% | 36% | 60.46% | 37.84% | -8.47% | 23.59% | 8.06% | -40.98% | 14.15% | 7.73% | 9.01% | 17.81% | 6.59% | 7.21% | 13.49% | 7.52% | -4.41% | -4.23% |
| EBITDA | 177.8M | 257.6M | 506.7M | 888.1M | 986.8M | 874.1M | 774.2M | 636.4M | 610.33M | 591.3M | 436.13M | 797.42M | 785.18M | 624.01M | 515.49M | 393.52M | 270.38M | 212.49M | 227.71M | 192.84M | 192.16M | 272.95M | 238.94M | 221.5M | 210.46M | 182.37M | 168.79M | 152.9M | 136.3M | 126.3M | 128M |
| EBITDA Margin % | 2.44% | 3.6% | 7.06% | 9.94% | 11.49% | 11.75% | 11.02% | 9.38% | 10.04% | 10.89% | 9.66% | 16.9% | 17.53% | 16.52% | 16.06% | 14.81% | 13.58% | 13.57% | 11.69% | 10.83% | 11.6% | 14.6% | 13.48% | 13.79% | 13.83% | 12.06% | 11.84% | 11.57% | 11.6% | 12.05% | 10.74% |
| EBITDA Growth % | -59.46% | -49.16% | -42.95% | -10% | 12.89% | 12.9% | 21.65% | 4.27% | 3.22% | 35.58% | -45.31% | 1.56% | 25.83% | 21.05% | 31% | 45.54% | 27.24% | -6.68% | 18.08% | 0.36% | -29.6% | 14.23% | 7.87% | 5.25% | 15.4% | 8.04% | 10.39% | 12.18% | 7.92% | -1.33% | 2.81% |
| D&A (Non-Cash Add-back) | 212.5M | 285.9M | 286.3M | 258.9M | 232.8M | 216.4M | 260.7M | 234.51M | 211.04M | 191.11M | 167.51M | 152.14M | 127.51M | 92.1M | 70.58M | 66.39M | 66.52M | 64.59M | 66.11M | 62.09M | 71.16M | 67.94M | 59.34M | 54.78M | 57.53M | 52.55M | 47M | 39.3M | 36.2M | 33.2M | 30.6M |
| EBIT | -418.6M | -399.9M | 283.1M | 754.2M | 834.1M | 664.8M | 202M | 484.49M | 486.22M | 350.95M | 329.57M | 697.19M | 710.56M | 580.64M | 485.77M | 350.46M | 221.22M | 155.28M | 186.68M | 185.44M | 173.55M | 203.57M | 206.31M | 179.9M | 164.45M | 129.82M | 135.92M | 113.65M | 100.1M | 93.1M | 97.4M |
| Net Interest Income | -128.6M | -132.8M | -142.3M | -133.8M | -72.7M | -36.1M | -60.6M | -76.69M | -56.97M | -32.16M | -16.32M | -11.46M | -11.24M | -6.21M | -5.93M | -3.83M | -2.68M | -4.11M | -9.62M | -15.1M | -9.77M | -4.71M | -2.11M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Interest Income | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Interest Expense | 128.6M | 132.8M | 142.3M | 133.8M | 72.7M | 36.1M | 60.6M | 76.69M | 56.97M | 32.16M | 16.32M | 11.46M | 11.24M | 6.21M | 5.93M | 3.83M | 2.68M | 4.11M | 9.62M | 15.1M | 9.77M | 4.71M | 2.11M | 2.46M | 2.4M | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Income/Expense | -484.6M | -504.4M | -79.6M | -8.8M | 7.4M | -29M | -372.1M | 5.91M | 29.95M | -81.41M | 44.63M | 40.46M | 41.65M | 42.52M | 34.93M | 19.5M | 14.68M | 3.27M | 15.47M | 39.59M | 42.78M | -6.15M | 24.6M | 10.79M | 1.24M | 9.74M | -7.53M | 4.74M | -51.8M | 9.1M | -100K |
| Pretax Income | -519.3M | -532.7M | 140.8M | 620.4M | 761.4M | 628.7M | 141.4M | 407.8M | 429.25M | 318.79M | 313.25M | 685.74M | 699.32M | 574.43M | 479.84M | 346.63M | 218.54M | 151.17M | 177.06M | 170.34M | 163.78M | 198.86M | 204.2M | 164.34M | 154.17M | 139.56M | 128.39M | 118.3M | 48.3M | 102.2M | 97.3M |
| Pretax Margin % | -7.14% | -7.45% | 1.96% | 6.94% | 8.86% | 8.45% | 2.01% | 6.01% | 7.06% | 5.87% | 6.94% | 14.53% | 15.61% | 15.21% | 14.95% | 13.05% | 10.98% | 9.65% | 9.09% | 9.57% | 9.89% | 10.64% | 11.52% | 10.23% | 10.13% | 9.23% | 9.01% | 8.95% | 4.11% | 9.75% | 8.16% |
| Income Tax | -73.8M | -67.9M | 29.6M | 117.7M | 158M | 132.1M | 16.5M | 83.92M | 93.99M | 146.3M | 100.3M | 230.38M | 245.29M | 193.36M | 167.53M | 119.05M | 71.4M | 50.16M | 59.67M | 57.74M | 50.99M | 61.14M | 67.39M | 53.41M | 50.58M | 48.15M | 45.58M | 42M | 17.3M | 36.8M | 35M |
| Effective Tax Rate % | 14.21% | 12.75% | 21.02% | 18.97% | 20.75% | 21.01% | 11.67% | 20.58% | 21.9% | 45.89% | 32.02% | 33.6% | 35.08% | 33.66% | 34.91% | 34.35% | 32.67% | 33.18% | 33.7% | 33.9% | 31.13% | 30.74% | 33% | 32.5% | 32.81% | 34.5% | 35.5% | 35.5% | 35.82% | 36.01% | 35.97% |
| Net Income | -446.1M | -465.5M | 110.8M | 502.8M | 589.7M | 493.9M | 124.8M | 323.96M | 335.26M | 172.49M | 212.95M | 455.36M | 454.03M | 377.29M | 312.31M | 227.57M | 147.14M | 101.02M | 117.39M | 111.65M | 111.98M | 136.71M | 128.36M | 110.93M | 103.59M | 91.41M | 82.81M | 76.3M | 31M | 65.4M | 62.3M |
| Net Margin % | -6.13% | -6.51% | 1.54% | 5.63% | 6.87% | 6.64% | 1.78% | 4.78% | 5.52% | 3.18% | 4.71% | 9.65% | 10.14% | 9.99% | 9.73% | 8.57% | 7.39% | 6.45% | 6.03% | 6.27% | 6.76% | 7.31% | 7.24% | 6.91% | 6.81% | 6.05% | 5.81% | 5.78% | 2.64% | 6.24% | 5.23% |
| Net Income Growth % | -1209.7% | -520.13% | -77.96% | -14.74% | 19.4% | 295.75% | -61.48% | -3.37% | 94.36% | -19% | -53.24% | 0.29% | 20.34% | 20.81% | 37.23% | 54.67% | 45.66% | -13.95% | 5.15% | -0.29% | -18.09% | 6.51% | 15.71% | 7.08% | 13.32% | 10.39% | 8.53% | 146.13% | -52.6% | 4.98% | 2.47% |
| Net Income (Continuing) | -445.5M | -464.8M | 111.2M | 502.7M | 603.4M | 496.6M | 124.9M | 323.88M | 335.26M | 172.49M | 212.95M | 455.36M | 454.03M | 381.07M | 312.31M | 227.57M | 147.14M | 101.02M | 117.39M | 112.6M | 112.79M | 137.72M | 136.81M | 119.82M | 111.33M | 91.41M | 82.81M | 76.33M | 31M | 65.4M | 62.3M |
| Discontinued Operations | 0 | 0 | 0 | 0 | -13.2M | -2.3M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -3.78M | 0 | 0 | 0 | 0 | 0 | -948K | -812K | -1.01M | -8.46M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 4.7M | 11.2M | 4.2M | 2.4M | 2.5M | 2M | 300K | 200K | 279K | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| EPS (Diluted) | -7.77 | -8.18 | 1.95 | 8.71 | 9.81 | 7.88 | 1.99 | 5.20 | 5.25 | 2.69 | 3.27 | 6.75 | 6.65 | 5.35 | 4.40 | 3.20 | 2.14 | 1.53 | 1.75 | 1.54 | 1.29 | 1.56 | 1.13 | 1.19 | 1.06 | 0.93 | 0.84 | 0.77 | 0.30 | 0.61 | 0.56 |
| EPS Growth % | -1188.89% | -519.49% | -77.61% | -11.21% | 24.49% | 295.98% | -61.73% | -0.95% | 95.17% | -17.74% | -51.56% | 1.5% | 24.3% | 21.59% | 37.5% | 49.53% | 39.87% | -12.57% | 13.64% | 19.38% | -17.31% | 38.05% | -5.04% | 12.26% | 13.98% | 10.71% | 9.09% | 156.67% | -50.82% | 8.93% | 1.82% |
| EPS (Basic) | - | -8.18 | 1.96 | 8.81 | 9.94 | 8.06 | 2.02 | 5.27 | 5.36 | 2.74 | 3.31 | 6.90 | 6.86 | 5.51 | 4.54 | 3.31 | 2.20 | 1.56 | 1.79 | 1.59 | 1.33 | 1.62 | 1.17 | 1.28 | 1.16 | 1.00 | 0.88 | 0.77 | 0.30 | 0.61 | 0.56 |
| Diluted Shares Outstanding | 57.4M | 56.9M | 56.8M | 57.7M | 60.1M | 62.7M | 62.6M | 62.29M | 63.9M | 64.18M | 65.16M | 67.48M | 68.23M | 70.55M | 71M | 71.06M | 68.77M | 66.15M | 67.13M | 72.65M | 82.9M | 87.57M | 88.84M | 93.22M | 97.73M | 98.29M | 99.17M | 99.6M | 104.2M | 106.78M | 111.66M |
| Basic Shares Outstanding | 57.4M | 56.9M | 56.5M | 57.1M | 59.3M | 61.3M | 61.9M | 61.44M | 62.5M | 62.92M | 64.3M | 66.02M | 66.17M | 68.53M | 68.85M | 68.79M | 66.9M | 64.8M | 65.54M | 70.47M | 80.65M | 84.26M | 84.7M | 85.93M | 89.65M | 91.86M | 94.17M | 98.93M | 103.33M | 106.78M | 111.44M |
| Dividend Payout Ratio | - | - | 133.3% | 29.3% | 25.44% | 31.06% | 122.2% | 46.02% | 44.45% | 84.31% | 65.9% | 30.59% | 27.95% | 30.14% | 32.51% | 27.06% | 36.05% | 49.67% | 42.25% | 42.76% | 44.86% | 34.35% | 30.27% | 24.03% | 24.4% | 24.99% | 24.93% | 25.82% | 60% | 25.99% | 26.32% |
Inventory-driven margin compression
According to recent quarterly filings, Polaris experienced a revenue growth rate of 8.0% in 2026Q1, yet this follows a period of significant contraction, suggesting that the company's top-line trajectory remains highly sensitive to broader consumer discretionary spending patterns and the ongoing normalization of post-pandemic demand.
The recent return to positive year-over-year growth appears to be a fragile recovery rather than a structural shift, as the company continues to navigate a challenging retail environment. Investors should monitor whether this growth is driven by genuine end-user demand or if it reflects aggressive wholesale channel loading to clear inventory.
As reported in financial statements, Polaris's gross margin has struggled to maintain historical levels, hovering near 20.2% in 2026Q1, which indicates that elevated manufacturing input costs and persistent promotional discounting are exerting significant downward pressure on the company's core profitability metrics during this current cycle.
The inability to sustain gross margins above the 20% threshold suggests that the company lacks the pricing power necessary to offset inflationary pressures in raw materials and logistics. This margin compression appears to be a direct consequence of a softening powersports market where consumers are increasingly price-sensitive.
Based on the provided income statement data, Polaris has entered a period of negative operating leverage, with operating margins falling to -3.3% in 2026Q1, demonstrating that fixed manufacturing overheads are currently outpacing the company's ability to generate sufficient operating income from its core vehicle and accessory sales.
The transition from positive operating income to a loss-making position suggests that the company's cost structure is too rigid for the current volume environment. Management's failure to scale SG&A expenses in proportion to declining gross profit warrants further investigation into the company's long-term operational efficiency.
Data from recent filings reveals a concerning trend of net losses, including a -$303.6M net income figure in 2025Q4, which implies that the company's earnings quality is currently compromised by significant non-operating charges and the potential for future inventory write-downs that could further impair shareholder value.
Short-sellers may focus on the disconnect between the company's reported revenue and its inability to convert that volume into bottom-line profitability. The reliance on wholesale shipments to drive revenue recognition may mask deeper issues regarding the health of the dealer network and the sustainability of current inventory levels.
Quick answers to the most common questions about buying PII stock.
For fiscal year 2025, Polaris Inc. (PII) reported total revenue of $7.15B. This represents a 500.1% increase compared to $1.19B in 1996.
Polaris Inc. (PII) reported a net loss of $465.5M for the fiscal year ending 2025.
Polaris Inc. (PII) reported an operating income of $-28.3M, resulting in an operating profit margin of -0.4%. This margin reflects the operational efficiency of the business before interest and taxes.
Polaris Inc. (PII) generated $1.32B in gross profit for the year, representing a gross profit margin of 18.5%. This demonstrates the company's core pricing power and production efficiency.