Thank you for standing by and welcome to the Harley-Davidson 2025 second quarter investor and analyst conference call. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Shawn Collins. Thank you. Please go ahead. Thank you. Good morning. This is Shawn Collins, the Director of Investor Relations at Harley-Davidson. You can access the slides supporting today's call on the intranet at the Harley-Davidson Investor Relations website. As you might expect, our comments will include forward-looking statements that are subject to risks that could cause actual results to be materially different. Those risks include, among others, matters we have noted in today's earnings release and in our latest filings with the SEC. Joining me for this morning's call are Harley-Davidson Chief Executive Officer Jochen Zeitz, also Chief Financial Officer Jonathan Root, and we have LiveWire's Chief Executive Officer Karim Donnez. With that, let me turn it over to our CEO, Jochen Zeitz. Jochen? Thank you, Shawn. Good morning, everyone, and thank you for joining today's call. This morning, we're going to start with details on our HDFS transaction that were announced earlier today before moving on to the Q2 results. We're very pleased to share that we've entered into strategic partnerships with both KKR and PIMCO for HDFS after completing a rigorous selection process with over a dozen parties bidding for the HDFS business over three rounds. We've consistently spoken about the strategic and financial value of the HDFS business, and we are very excited to announce this transaction that clearly reinforces all of you. On our first quarter call, we laid out four key objectives that any transaction involving HDFS would need to achieve, and I'm pleased to say that we are checking the box on all of them, providing the business with a lot of flexibility in the future. First, we said it would have to reflect the significant value HDFS represents to Harley-Davidson and its shareholders. The investment in HDFS equity at approximately 1.75 times post-transaction book valuation by these two world-class investors clearly achieves that goal, illustrating HDFS's class-leading returns and corresponding significantly higher valuation to book value. Second, a transaction would have to create value over the long term with a strategic partner. We expect this transaction will accomplish that across a range of fronts. Our new strategic partners will purchase about two-thirds of HDFS future retail loan originations at a premium on an annual basis for five years. Going forward, HDFS will retain one-third of new consumer loans, and when combined with new fee streams, we expect it will significantly increase HDFS's go-forward ROE to the high 20s. With their minority equity ownership of HDFS, KKR and PIMCO are in it for the long term. Third, a transaction would have to allow us to maintain or lower our overall cost of funding. With this transaction, we are reducing our overall leverage and the perceived risk highlighted every time the business environment deteriorates, freeing up significant equity on the balance sheet and creating a long-term stable funding mechanism, all of which we believe will contribute to greater funding flexibility and lower borrowing costs. We expect this transaction to boost HDFS earnings substantially this year by $275 to $300 million in operating income. On top of the strong HDFS operating result expected this year, we believe there's a clear path to growing HDFS operating income quickly toward pre-transaction levels in an asset-light manner in future years. We plan to achieve this through the retention of only approximately one-third of annual consumer originations, as well as through new fee streams from loan originations and servicing fees and organic growth, along with the commercial finance, insurance, car products, and international partnerships that we retain. Lastly, but importantly, we were clear that the transaction could not have a negative impact on our customers or dealers. For customers, this transaction will be transparent, with HDFS continuing to originate and service both new and existing retail loans. For our dealers, HDFS will be able to continue providing dealers with service, benefits, and flexibility commensurate with what HDFS currently provides. Most importantly, this transaction will free up cash and allow additional flexibility to support demand-driving initiatives. Overall, we believe the new partnership is a big win on all levels. In addition to other significant future benefits, this transaction is expected to generate cash that will allow HDFS to pay a distribution of approximately $1.25 billion to HDI and leave HDFS well-positioned to continue to serve our customers and dealers in the best possible ways. With the cash generated from this transaction, we're planning to reduce our debt by about $450 million and to accelerate our $1 billion share buyback program announced last year with the intention to purchase $500 million in the second half of 2025. We expect this will give us the flexibility to invest up to $300 million of additional funds into future growth opportunities. The post-transaction book value multiple realized in this transaction is a significant valuation for HDFS, and we believe it will serve as a major value unlock over time as it clearly highlights the substantial undervaluation of HDMC relative to other comparable companies. To summarize, the post-transaction HDFS business's equity has been valued by our partners at around $500 million or approximately 1.75 times post-transaction book value. As a result of this transaction, HDFS intends to distribute $1.25 billion of cash to HDI, representing around 40% of our current market cap. The combined $1.75 billion of HDFS driven value compares to Harley-Davidson's current market cap of approximately $3 billion. In addition, HDI was holding $1.6 billion of cash and equivalents at the end of Q2. This transaction implies that HDMC is trading at around eight times consensus operating income compared to peers at around 14 times. Turning to HDMC and Q2, in the face of a continuously challenging commercial environment for discretionary products in particular, consolidated revenue for the second quarter declined 19%, driven primarily by a planned reduction in motorcycle shipments and soft demand. Global motorcycle retail sales were down 15% year over year, reflecting the continued impact of elevated interest rates on customer purchasing behavior, broader demand softness, and overall economic uncertainty. In response to the ongoing uncertainty and persistently higher than expected interest rates, the company will look to introduce a new efficiency program and enhance and, where possible, accelerate its existing productivity initiatives. Any efforts will leverage technology, including AI, which we expect will deliver substantial cost savings and drive further productivity gains across the business. Across our portfolio, performance was mixed depending on the segment. Touring continued to face headwinds as we left a strong model year 2024 launch of the redesigned Touring platform. That said, through the quarter, we remained disciplined in motor company-led promotions, even as competitors leaned heavily on promotional activity, an area where we have exercised greater restraint, including on our 2025 models. The newly refreshed Softail lineup is performing better in the market. Additionally, our RevMax platform, including both Adventure Touring and Sportster models, grew 16% year over year in North America. This growth was driven by several factors, including the strategic repricing of Knights to below $10,000 and an increase in consumer appreciation for the platform. Overall, in the U.S., while market share for Touring declined, we saw an increase in our overall cruiser business, as well as a modest increase in our Adventure Touring offering in a challenging overall market. As promised during the quarter, we continued to reduce dealer inventory with global levels down 28% compared to Q2 2024. This aligns with our ongoing commitment to right-size inventory and better match demand. The fluid global tariff environment and negative consumer sentiment remains a challenge for the business. However, our ongoing engagement with various governments gives us cautious optimism that future trade agreements may help limit the overall impact on our operations. The EU agreement announced this past weekend looks to be a positive step forward. In the meantime, our teams are working diligently to manage the near-term effects on 2025, while also implementing longer-term mitigation strategies to minimize potential impacts on the business. Additionally, following productive engagement with the U.S. administration, we are pleased that Harley-Davidson motorcycles have been included in the recently signed automotive tax deduction legislation, part of the broader economic bill. Under the new law, interest paid on loans for new U.S.-built motorcycle purchases up to $10,000 annually is tax deductible when all vehicle and customer eligibility criteria are met. We believe this will have a positive effect and stimulate demand as the tax incentive takes hold in the market. Turning to racing. Since 2021, we've leaned into our racing heritage, both through product development and the revival of Harley-Davidson factory racing, competing at the highest level in both the King of the Baggers and Hooligan series, where we are proud to be leading both this year. Drawing inspiration from the track to the street, in March, we introduced our first limited production race replica inspired by our King of the Baggers race bikes, the CVO Road Glide RR. This model blends elite performance with the signature craftsmanship of Harley-Davidson's CVO lineup. As expected, the 131 motorcycles priced at $110,000 generated an oversubscribed waitlist and pre-orders, underscoring the growing excitement around our racing-inspired offerings, including P&A and racing experiences, highlighting new opportunities in the future. We remain energized by the power of racing to ignite passion and are committed to leveraging it as a strategic catalyst for brand and product innovation. In that spirit, this May, we announced a landmark partnership with MotoGP, the leading global motorcycle racing championship in the world, to launch a new racing series in 2026 featuring Harley-Davidson bagger motorcycles. The 12th race championship will span six Grand Prix across Europe and North America, with each round showcasing two races on race-prepared Harley-Davidson Road Glide motorcycles. The grid will feature six to eight teams, each fielding two riders, and will be supported by Harley-Davidson factory racing. I'm pleased to say that we're in advanced stages of signing various teams following a very strong interest from many race teams. With this new series, we will be bringing a bold, high-performance expression of the Harley-Davidson brand to the global stage, celebrating our historic racing legacy while redefining its future. It promises to be a thrilling addition to the world's premier motorcycle racing landscape. Stay tuned for more. Our race team's home will soon be located at Juno Avenue, where we're making substantial investments into our historic headquarters to ensure the site is workforce-ready by year-end, complementing our already remodeled HGU building and newly built Harley-Davidson Park. As mentioned in our previous earnings call, we are planning to introduce new entry-level products in smaller displacements, as well as an iconic classic starting next year. Today, I'm pleased to confirm the launch of our first small displacement motorcycle for the U.S. and international markets, which has been in development since 2021. Inspired by our heritage and the spirit of the iconic Harley-Davidson Sprint motorcycle, this new bike embodies boldness, irreverence, and fun, capturing the rebellious energy that defines the Harley-Davidson experience. Scheduled for release in the first half of 2026 and for a presentation to our global dealer network in October of this year, I'm pleased to share that we're targeting an entry price below $6,000. We believe this motorcycle will not only be highly accessible but also profitable, marking a significant step forward in driving Harley-Davidson's future profitable growth and opening up a new path and motorcycle segment for the company in future years for its key markets. The new Harley-Davidson Sprint motorcycle will be complemented by an additional and, for the first time in an expected, profitable, iconic entry price point motorcycle in our traditional cruiser segment planned to follow soon after. All of this will be in addition to other new and exciting products we will be launching next year. Lastly, a few words about LiveWire. The company remains committed to significantly reducing cash burn and operating losses, and the LiveWire team has worked diligently to manage operating expenses across the business. In Q2, LiveWire delivered a 34% improvement in consolidated operating loss compared to Q2 2024 and reduced its use of cash and cash equivalents for the six months ended June 30 by 36% compared to the same period in 2024. We're encouraged by the progress made, and there's more to come. LiveWire continues to focus on its strategic pivot, maintaining market presence amid ongoing industry challenges while staying at the forefront of innovation, adding new high-volume segments. Today, we can confirm that LiveWire intends to launch production versions of its two latest concept models that were showcased at Harley-Davidson Homecoming earlier this month. These new mini models represent a strategic refocus in LiveWire's product portfolio, aligning with evolving customer expectations, broader EV adoption trends given the significantly changed consumer and incentive environment since we launched the brand, and fast-growing global demand for lightweight, off-road, and urban-friendly mobility solutions. These products mark an early step into new segments with more developments expected in the coming months. LiveWire has seen a tremendous response to these bikes over the past few weeks, and we look forward to formally launching them at EICMA in November. Jonathan, over to you. Thank you, Jochen, and good morning to all. While Jochen touched on many of the benefits of our new strategic partnership with KKR and PIMCO, I wanted to provide a transaction overview before I go into the Q2 results at Harley-Davidson. Harley-Davidson has agreed to sell a common equity interest in HDFS at approximately 1.75 times book value, with each partner acquiring a 4.9% stake. As part of this transaction, HDFS has agreed to sell over $5 billion of existing gross consumer retail loan receivables and residual interest in securitized consumer loan receivables at a premium to par value. As a result, we will have a benefit from the release of loan loss reserve and sale of consumer loan receivables at a premium to par value. We expect this to contribute $275 to $300 million incremental to HDFS operating income in fiscal year 2025. This will allow us to execute on our expectations to reduce approximately $4 billion of HDFS debt associated with consumer retail loan receivables. In addition, going forward on an annual basis, we expect the strategic partners to purchase around two-thirds of HDFS future retail loan originations annually for five years, also at a premium to par value. The partners will pay a fixed servicing fee of 1% and 2.5% for prime and subprime receivables purchased from HDFS, respectively. Of note, in this transaction, we are not selling any wholesale receivables. There is no direct impact on commercial lending, card products, insurance, and protection products or international beyond the equity stake mentioned. Harley-Davidson retains a controlling interest in HDFS with over 90% ownership. The transaction is expected to close in the second half of this year. In summary, we are excited to unlock significant value of HDFS for our shareholders through the sale of a minority stake while transforming HDFS into a capital-light financing business. In addition, following 2026, it is creating a path that we believe will grow HDFS operating income in the future through new loan origination fees and loan servicing fees. Naturally, we welcome that with the transaction, we will generate $1.25 billion of discretionary cash for Harley-Davidson to use while we retain full control and majority ownership of HDFS. Now, I will turn to the Q2 results at Harley-Davidson. I plan to start on page seven of the presentation where I will briefly summarize the consolidated financial results for the second quarter of 2025. I will go into further detail on each business segment. Consolidated revenue in the second quarter was down 19%, largely in line with our expectations across HDMC and HDFS, while revenue also decreased at LiveWire. Consolidated operating income in the second quarter was $112 million, driven by a decline of 69% at HDMC. Operating income at HDFS came in at down 2% relative to prior year. At the LiveWire segment, the operating loss came in at $19 million. Consolidated operating income margin in the second quarter came in at 8.6% relative to 14.9% in the second quarter a year ago, representing a 629 basis point decline, primarily due to the impacts associated with lower volume as we deliver on our commitment to help bring down dealer inventory. I plan to go into further detail on each business segment's profit and loss drivers in the next section. Second quarter earnings per share was $0.88. As said previously, in Q2, global retail was down 15%, with the North American market being down 17% and international markets down 12%. Broadly speaking, customers are continuing to seemingly take a pause or wait-and-see approach to some extent based on higher interest rates and overall macro uncertainty, both factors having a meaningful impact on our specific customer profile buying patterns. In North America, the market continued to experience lower customer traffic coming into Harley-Davidson dealerships. We also experienced this in the first quarter, even though traffic trends improved in Q2. Our conversion rates actually remain fairly solid relative to recent history. Starting in April, as greater global tariff uncertainty was introduced, it added to the overall economic uncertainty that we experienced in Q1, and it stayed with us through most of Q2. North America performance for Q2 saw a year-over-year decline, but was an improvement from the decline experienced in Q1. As we get through July, we are seeing some signs of improvement in customer traffic in dealerships in North America based on some of our most recent go-to-market initiatives, such as new marketing initiatives, targeted promotional activity, a renewed approach to strategic price changes in each family, and amplified and more creative rider testing initiatives. We are also seeing our new marketing development fund truly being embraced by our North American dealers, with impacts now showing up in market. In EMEA, retail was down 5% and experienced overall volatility due to the global tariff situation. Softail motorcycle retail was positive in Q2, up 4%, as the redesigned model year 2025 Softail models hit the market. From a country perspective, we witnessed growth in the German region and the Benelux and Nordic region. These were offset by declines in France and the UK. In Asia-Pacific, retail continued to be soft and was down 21%. This was due to intense competition in the lightweight and smaller motorcycle segments. From a product perspective, our refreshed Softail model year 2025 lineup performed fine as it hit the market in Q2, but we are optimistic for a stronger performance in the second half of the year. From a country perspective, the sharpest declines were in Japan and in China due to continued economic uncertainty. In Q2, in the total cruiser category, we experienced 6% volume growth in the U.S. and gained three points of share in the total cruiser segment, growing to 53% market share in Q2 of 2025 from 50% market share in Q2 of 2024. Moving on to dealer inventory, we believe current dealer inventory and product availability are in an improving and healthier position overall, as we are now in the midst of the 2025 riding season. Global dealer motorcycle inventories were down 28% at the end of Q2 compared to the end of Q2 of 2024. We are committed to supporting a significant year-over-year dealer inventory reduction by year-end. We are well on our way to this, as already demonstrated in the first quarter and again in the second quarter, which marks our third consecutive quarter of decreasing dealer inventory on an equivalent year-over-year basis. Looking at revenue, HDMC revenue decreased by 23% in Q2. Focusing on the key drivers for the quarter, 23 points of decline came from decreased wholesale volume at HDMC, where motorcycle shipments in the quarter were down 28%, coming in at 36,000 units compared to 50,000 units in the year-ago period. This level balances our need to be prepared for the ongoing riding season and balance against any changes in the demand environment, given recent macro headlines and uncertainty. One point of growth came from favorable year-over-year pricing net of sales incentives for 2025 model year product. One point of decline came from mix as we balanced out the delivery of motorcycle models and markets. Finally, foreign exchange impacts resulted in one point of growth to Q2 revenue relative to prior year. In Q2, HDMC gross margin was 28.6%, which compares to 32.1% in the prior year. The decrease of 350 basis points was driven by the revenue factors I just spoke about and lower operating leverage, which includes modest cost inflation of less than 1%. In order to deliver on our commitment to help bring down dealer inventory, production volumes were down commensurate with the lower wholesale shipments in Q2 of 2025. The lower production volumes resulted in a higher fixed cost per unit on motorcycles shipped in Q2 of 2025. The unfavorable impact of lower operating leverage was modestly offset by other productivity savings related primarily to supply management during the quarter. In addition, the cost of new or increased tariffs implemented in 2025 resulted in $13 million of incremental cost in the Q2 period, creating a headwind of 125 basis points to the Q2 2025 operating income margin. Operating expenses in Q2 came in $2 million higher than prior year at $237 million, which resulted in an HDMC operating margin of 5.9%, which compares to 14.7% in the prior year period. This higher OpEx was primarily driven by the planned spend for the marketing development fund I spoke of earlier and was partially offset by lower people costs, which we achieved through robust cost discipline. Turning to slide 12. In the year-to-date period, HDMC gross margin was 28.9%, which compares to 31.7% in the prior year. The decrease of 280 basis points was driven by lower volumes and lower operating leverage, partially offset by the positive impacts of pricing, mix, and foreign currency. The year-to-date results include modest cost inflation of less than 1%. In addition, the cost of new or increased tariffs implemented in 2025 resulted in $17 million of incremental cost in the year-to-date period, creating a headwind of 80 basis points to the year-to-date operating income margin. This excludes costs of $7 million to mitigate tariff impacts. Operating expenses in the year-to-date period came in $21 million lower than prior year at $436 million, which resulted in an HDMC operating margin of 8.4%, which compares to 15.4% in the prior year period. Before we turn to the next slide, I would like to update on our ongoing productivity cost program, where we were expecting to drive a $400 million improvement in productivity by 2025. As a reminder, for the cumulative three-year period of 2022 through 2024, we have achieved unlevered productivity savings of $257 million. We continue to expect to achieve another $100 million for all of 2025 and again in 2026, exceeding our Hardwire dollar target by over 10%, as mentioned in February. In the first half of 2025, we achieved $48 million of unlevered productivity, split evenly by quarter, primarily from logistics and supply chain initiatives. Turning to slide 13. The global tariff environment remains uncertain, but we wanted to provide an update. In the first half of 2025, the cost of new or increased tariffs was $17 million. This includes direct tariff exposure, Harley-Davidson importing and exporting product, as well as indirect tariff exposure from our suppliers. This excludes pricing mitigation actions, as well as any expenses to accelerate product deliveries ahead of tariffs. We do expect that the direct tariff costs will increase in the second half of the year, but the environment remains volatile. Harley-Davidson is a business very centered in and around the U.S. Three of four manufacturing plants are U.S.-based, including final assembly in York, Pennsylvania, and powertrain operations and injection molding with class-leading paint application, each in Wisconsin. We also have a U.S.-centric approach to sourcing, with approximately 75% of component purchasing coming from the U.S. All of our core products sold in the U.S. are proudly assembled in the U.S. With that in mind, we estimate our full year 2025 impact from the direct cost of new or increased tariffs to be in the range of $50 to $85 million. This has been reduced from $130 million to $175 million at Q1 release on May 1. We have a number of actions underway to mitigate the impact, and we expect this situation will remain fluid, given the uncertainty that still exists. Turning back to HDFS and its performance. At Harley-Davidson Financial Services, Q2 revenue came in at $257 million, a decrease of only 2%, driven by modestly lower retail receivables and commercial receivables. HDFS operating income was $70 million, down less than $2 million or 2% compared to last year. The small Q2 decrease was driven by lower net interest income and higher operating expenses, partially offset by lower provisions for credit losses and higher other income. The provision for credit loss expense was $6 million lower as a result of a favorable reserve change, partially offset by higher credit losses. The reserve change was $7 million favorable as compared to Q2 2024, primarily driven by a smaller increase in retail receivables during Q2 2025 compared to Q2 2024. In Q2, HDFS's annualized retail credit loss ratio was 3.25%, which compares to 3.12% in the year-ago period. Retail credit losses were $1 million higher than a year ago. In addition to the small increase in credit losses, the June 2025 annualized retail credit loss ratio was further negatively impacted by a decline in retail receivables. While delinquencies remained elevated as customers continued to be impacted by higher bike payments and general inflationary pressures, the retail credit loss is moderated thanks to improved repossession success rates and stabilizing recovery values at auction. There were no commercial finance credit losses during Q2 2025. In addition, the retail allowance for credit losses for the second quarter remained flat at 5.7% from Q1 2025. Total retail loan originations in Q2 were down 15%, while commercial financing activities were also down, decreasing 20% to $1.1 billion as a result of the significant reduction in motorcycle inventories at our Harley-Davidson dealerships. Total quarter-end net financing receivables, including both retail loans and commercial financing, was $7.3 billion, which was down 9% versus prior year. For the LiveWire segment, which is on page 17, electric motorcycles revenue decreased in the second quarter of 2025 compared to the prior year period, driven by lower unit sales of LiveWire electric motorcycles. Selling, administrative, and engineering expenses were $8 million lower compared to the prior year. LiveWire operating loss of $19 million in Q2 2025 was in line with expectations and compares to an operating loss of $28 million in the prior Q2. We now expect LiveWire's full-year operating loss to come in between $59 and $69 million. On a unit basis, LiveWire reported sales of 55 units in Q2 compared to 158 units sold in the prior Q2. The uncertain macro environment and the lack of any incentive continued to weigh on the consumer's discretionary appetite for bigger motorcycles in early-stage EV products. Wrapping up with consolidated Harley-Davidson Q2 financial results, we delivered $509 million of operating cash flow, which was down $68 million from the prior period. The decrease in operating cash flow was due to lower net income and due to working capital activity, partially offset by lower net cash outflows related to wholesale finance receivables in the first six months of 2025 as compared to the same period last year. Total cash and cash equivalents ended at $1.6 billion, which was $261 million lower than at the end of Q2 prior year. This consolidated cash number includes $29 million at LiveWire. Additionally, as part of our capital allocation strategy, we remain committed to returning capital to shareholders. Given the unexpected operating environment since early April due to the sudden and unpredictable changes in global tariff policy, we moved to the sidelines in Q2 and did not buy back any Harley-Davidson shares during Q2. We did buy back 3.4 million shares of our stock at a value of $87 million in Q1 of 2025. Given that the global tariff situation remains ongoing and uncertain, we continue to withhold our full-year 2025 financial outlook for HDMC and HDI. Following today's announcement, we expect HDFS should come in at approximately $525 to $550 million of operating income for 2025. As we move into the second half of 2025 and with the noted closing of the HDFS transaction, I will again summarize the intended uses of proceeds. We plan to increase the pace of buybacks and are working hard to deliver on our $1 billion commitment in share repurchases we announced in July of 2024. Our plan is to purchase $500 million in shares during the second half of the year, as mentioned earlier. We also plan to reduce our debt by $450 million and have a meaningful balance remaining to invest into the business. We expect this will give us the flexibility to invest up to $300 million of additional funds into future growth opportunities. With that, we will open it up to Q&A. Thank you. As a reminder, to ask a question, please press star one on your telephone keypad. To withdraw your question, please press star one again. We also ask that you limit yourself to one question and return to the queue for additional questions. Thank you. Our first question comes from Craig R. Kennison from Baird. Please go ahead. Your line is open. Hey, good morning. Thanks for taking my questions. One on the HDFS transaction. What are the components you are using to calculate that 1.75 times book value marker? I'm just not seeing it clearly in the numbers. Sure. Hi, Craig. It's Jonathan. Great question. As we look at where the 1.75 lands, it's actually the derivative of the proceeds that come in from KKR and PIMCO for their equity investment in the business. As you would flow through and take a look at kind of where the book value of the business would come in and then how the equity is associated with that book value, it kind of lines up to a 1.75 multiple. We will have more disclosures in our Ks and Qs that are coming that will help outline all of this, but it's effectively the relationship between the premium that they pay versus the post-transaction book value of HDFS. Our next question comes from Joseph Nicholas Altobello from Raymond James. Please go ahead. Your line is open. Thanks. Good morning. A couple of questions on HDFS. First, the underlying profitability of that business looks like it got better than you guys originally anticipated. What's driving that? You mentioned that you expect that business to grow and get back to its normal profitability over time, but what is the normalized profitability for that business under this new arrangement in 2026, for example? Okay. Hi, Joe. Just answering a couple of your questions. From an HDFS profit standpoint, as we think about your first question around 2025, we have seen from an overall HDFS standpoint, we disclosed what you're seeing going on relative to delinquency. We covered some of the drivers and the characteristics from a loss standpoint. We're pretty pleased in terms of the stabilization and slight improvement in used values. We use the source that we find is the most consistent and most reliable in terms of used values, which is Black Book Data. As we go through and parse the Black Book Data and take a look at that, a comfort that we're seeing is a slight improvement in used values. That's helping us as we think about what the overall HDFS business looks like. We're really pleased with what we're seeing from our dealers in terms of dealers showing up at our auctions. When we do have to repossess a unit, the dealer participation at auction for us is very helpful. That helps us from both a value perspective and also as we think about giving us another swing to have another contact point with those customers. When the used motorcycles get retailed through our Harley-Davidson dealers, that helps us too. We've seen some really nice stabilization in terms of Harley-Davidson dealer control of used. We've seen some nice stabilization and slight up in used values. We've also been very pleased about repossession rates. The HDFS team is doing a wonderful job of really driving the repossession rate in a direction that's favorable. As we put all of those underlying factors together in terms of loss characteristics, we're very pleased with the way that the business is performing on that front. That's been a trend that's improved as we've moved through the months in the year. Pretty pleased with the base level there. Sorry. Go ahead, Jochen. Yeah. Just to add to what Jonathan said, it's not just the stabilization of used values or slight improvement. It's also that the used motorcycle business actually grew in Q2 compared to the new business. Obviously, HDFS finances both used and new. That's an additional factor. Okay. Thanks, Jochen. One last point, Joe, on your question around kind of normalized earnings. If you take a look at what we've provided on page 24 of our earnings deck, we have a little longer earnings deck this quarter to try to cover details of the transaction. As you would walk through that, it starts to tell you the time that things take from a normalization standpoint. We think of normalized HDFS earnings, to answer your question directly, of about $240 to $250 million a year in operating income. Our next question comes from Tristan M. Thomas-Martin from BMO Capital Markets. Please go ahead. Your line is open. Hey, good morning. I know you mentioned that consumer traffic picked up in July, but has that translated to improved retail performance? Yeah. Tristan, I can't give you the final number for July yet, but we've seen a sequential significant improvement if you look at the North American figures. In fact, if you look back all the way from February, retail trends for new motorcycle unit sales improved every month. We expect that to continue in July as well. A significant improvement is expected. Going forward for the rest of the year, we believe we can actually come positive given the measures that we've taken in the market and easier comps compared to last year and some of the measures we've taken, Jonathan has already highlighted. July, another improvement in the U.S., and we expect that to continue until the end of the year. Our next question comes from Alexander Thomas Perry from Bank of America. Please go ahead. Your line is open. Yeah. Hi. Thanks for taking my questions here. Just a two-parted question. Can you talk through how you feel about current dealer inventories and what the target is for year-end? The timing of the model launch shift, can you talk about how you're going to sort of sequence that in? Are you planning to launch, you know, bikes this fall? Just wanted to get more color on how you're thinking about new model launch timing. Thanks. Yeah. I'll take the first question. In terms of dealer inventory, you've seen the commitment that we've made early in the year to significantly reduce dealer inventory, and that has happened across the world, including the U.S., with the marked decline that we had mentioned earlier today. As Jonathan mentioned earlier, we expect that to continue and expect a significant reduction. To what extent is difficult to say right now. It, of course, also depends on retail sales, but definitely a double-digit decline should be a target, considering that last year, last quarter of last year, we already saw a decline of about 4% in our dealer inventory. That then accelerated in terms of decline in the first and second quarter. Overall, we think that we are ending the year with very healthy levels of dealer inventory. Alex, I'll take the piece on model year shift. From a model year shift perspective, we're still working through some of the details with our dealer network in terms of exactly what it means and the timing. Truthfully, as we look at some of these things, there are differences between model year launch in the United States or North America and the rest of the globe, just as we think about where we have a preponderance of manufacturing. As we look at that carryover, think sort of a refresh of our Touring motorcycles, our Softail lineup, that all takes place beginning this fall. We have the ability to continue to drop some exciting intros throughout the year, as you have seen us do over the last couple of years. I think a great example of that is, as we look at this year, our Grey Ghost Softail, for example, that product has sold very, very well. That is something that has generated a lot of buzz, a lot of enthusiasm, and a lot of excitement across the dealer body. You'll continue to see some special iterations and special vehicles drop throughout the year. We will always be driving excitement and freshness into the dealer body. We are excited to be able to pull the model year shift forward and back into the fall. For us, that does a couple of things. It really helps us as we think about throughput and how we get everything through our network into our dealers and prepared for the coming season. It also helps us extend the season a little bit by keeping some excitement showing up in our dealership toward the end of the calendar year. Full details we're working through with our dealer partners. You will see that excitement come back into the fall. Thanks so much. Our next question comes from Stephen White Grambling from Morgan Stanley. Please go ahead. Your line is open. Hi. Thanks. This is a bit of a multi-parter on the HDFS transaction. Why was the 4.9% equity sale the right level sold? Are there any tax ramifications to think through that are incorporated into that $1.25 billion in cash unlocked, or is that a gross number? Also, how is the exchange rate into HOG stock set that's in the presentation? Thank you. Okay. Thank you, Stephen. I'll start with the 4.9% question. A really good one. Why 4.9%? As we go through and we take a look at the HDFS business, it is a pretty complex little business. We're super proud of the way that that business runs and what it generates across Harley-Davidson. One of the elements that we have to factor in from an HDFS standpoint is the fact that we have an industrial loan corporation, so Eaglemark Savings Bank. ESB is FDIC regulated. From an FDIC perspective, there are caps and covenants around ownership, the percentage of it that we would own, and then investment into the business. The 4.9% threshold is something that the FDIC has a comfort level with in terms of any sort of additional owner. We limited around the 4.9% to a high degree because of regulatory ease. When we start moving beyond that, it's not that it can't be done. It's just a little more complex in terms of the hoops that you have to jump through. That's really why the limit, you know, KKR with their 4.9% ownership and then PIMCO with their 4.9% ownership, that's the rationale for the 4.9% limit. As we think about the one and a quarter, the one and a quarter that flows up from a distribution from HDFS to the parent company, that is a pre-tax figure. Obviously, we will end up having to sort of flow through all of our normal tax planning and tax management on that front. I think in the latest quarter, you saw us probably, you know, low 20s from a tax rate perspective that we've been running at on a year-to-date basis. As we think about your last question around exchange rate, I think as you flow through that piece, we probably need to have a follow-up conversation with you just to make sure that we understand the detailed nature of your query on that front. I don't quite know what the question is, so I'll struggle to answer that one. The business is primarily the U.S. business that we're talking about, so there shouldn't be any significant exchange effects. We'll get back to that, Stephen. Just to add to what Jonathan said, the reasons you highlighted are, I think, important reasons why we've limited the sale at 4.9% from both perspectives, from the partner's perspective and our perspective. As we mentioned earlier, we had more than a dozen bids that ranged all the way from long-term committed purchases of loan receivables to an outright sale of the majority of the business. We actually could have sold the majority or all at a significant premium to book value. Given the four key objectives that I had mentioned that any transaction involving HDFS would need to achieve and that we set out already earlier in the year, we feel that this was the best possible outcome and requiring least complexity and a big win, really, on all these levels. Our next question comes from Robin Margaret Farley from UBS. Please go ahead. Your line is open. Great. Thank you. I also wanted to ask about the HDFS transaction. Kind of two-part question, I guess. One is, is the transaction assuming any kind of growth in retail sales of Harley or growth in receivables, or any kind of guarantee at all along those lines that's coming with the sale where the terms might change if certain sales or receivable or operating income thresholds aren't hit? Also, just thinking about that, what you're giving up in exchange for the 1.25%, just looking, historically, financial services, I think last year it was more than 40% of the total company earnings. Maybe it would be more than 50% this year. I know there's not guidance for the full year. Just trying to think about, can you help us quantify what earnings come out of your go-forward number in exchange for those proceeds? Thanks. Okay. Thank you, Robin. Let's start with the first part in terms of guarantees. As you would imagine, both KKR and PIMCO are pretty highly esteemed, pretty savvy investors. There are no guarantees around maintaining a certain growth rate, maintaining certain loss levels. As we take a look at the way that that's done, there aren't guarantees of any nature, kind of in answer to your question and the pieces that you hinted at. The great news is that, as Jochen touches on, as we go through this process, we kind of began with a pretty wide range of parties that were interested in the business. We narrowed that down to about a dozen or so as we got into more serious negotiations and then came down to the final two in terms of KKR and PIMCO. They have a super high degree of comfort in terms of the way that the business is run, the prudence with which the team underwrites the business, collects on everything. I think it really is a testament to the leadership that we have at HDFS and the way that that business runs. There aren't any sort of guarantees in terms of performance where we have risk or exposure from that standpoint. There's a high degree of comfort that we will continue to run the business in the way that we have, where it runs profitably through cycles. Obviously, when we look at the strength of the partners and what it means from a liquidity standpoint and a comfort level as to how we actually fund that business going forward, we are extremely happy to have each of them as engaged partners in the business. As we think about what we're giving up, the main thing is that with what we have outlined, we end up with about a third of the annual originations on our balance sheet for the retail business rather than three-thirds that we would have had previously. In exchange for the one-third that goes to KKR and the one-third that goes to PIMCO, they are obviously paying, as we have outlined, a premium to par on the retail loans that we originate. They also pay the servicing fees that we outlined in the conversation. You can see that there is a little bit of a curve to the earnings. We have the tremendous benefit from an earnings standpoint that we've outlined for 2025. On page again, let me check the exact page. On page 24 of our earnings deck, we outline what happens from an overall capital perspective and then what happens from an earnings standpoint. On the right of that page, you'll see sort of a directional earnings curve. We'll get into more details later. On the left, you see the significantly reduced capital levels inside of the business as we move forward. That's what drives the ROE benefit that Jochen spoke of. Our next question comes from James Lloyd Hardiman from Citi. Please go ahead. Your line is open. Hey, good morning. Just a quick clarification, Jochen, I think you said that you expected retail to be positive in the second half. Could you clarify that and how do we get there? My bigger picture question, the small displacement bike, right? There was some discussion of that in the prepared remarks. Obviously, there's a lot that you guys are working through today. That seems like a really big deal, particularly as we think about what's been elusive to Harley-Davidson historically, right? An entry-level bike that's both popular and profitable. If you're successful with that, that could really move the needle. Maybe speak a little bit more about how that's possible, that profitability component in particular, how have you been able to accomplish that, whereas previous generations of Harley-Davidson management have not, and what that profitability should look like going forward. Thanks. Thanks, James. Yes, going forward, we expect retail sales certainly in North America to be positive for the given reasons that we had mentioned. That's concerned. As we've seen the trends since February improve, it won't take much to achieve that, considering also the easier comps as of August. In terms of STV, I completely agree with you. This is a big step for the company, not only with our STV, but also with the iconic cruiser that we're working on, that we are going to launch thereafter, and both for the first time in a manner that we believe that we can actually make money on both of them. A price point starting at $6,000 and then adding additional price points over future years will allow us to play in a segment which, especially when you look at this year, but even last year, is the only area that really shows growth right now, which very much is a result of affordability issues that our core customers have that we need to take into consideration. This bike has been in development since 2021. It's taken time, but we feel confident that it can achieve a profitable margin. From there, obviously, we can build a profitable business in various segments that we have not or partly not competed in. The cruiser segment that we have competed in before, but as you know, that has never been a profitable business for many decades. We believe that how we've engineered this product, it will be profitable. That's a significant unlock, which is why we've mentioned it. We've mentioned it also in this call because we are going to present the small displacement vehicle to our dealers in early October. As you are very well connected, we thought we'd give you a heads up already now rather than wait until October. I don't want to go into specifics of how we feel we've accomplished that, but we have worked very hard over a long period of time and believe this is absolutely possible. We've learned a lot in the last five years, in particular, to be confident that we can achieve this finally for the company. Yes, agreed, significant unlock for the business, and especially in the current business environment. If you at some point see the business returning in the big bike segment, which has been challenged over the last almost two years, and in addition, the new fuel that we will be put on the fire with these bikes over the next few years, coupled with new product developments that will come out starting next year, this is, I think, all good news. Our last question comes from Jaime Katz from Morningstar. Please go ahead. Your line is open. Hey, good morning. Just a clarification to start. The $300 million that's going into HDFS, should we dump that into 3Q or 4Q because it's going to swing earnings pretty significantly whenever it goes in, I suppose? The other thing you guys talked about that wasn't mentioned was a new efficiency program. Is there any intel on the magnitude of that impact? Are you in the early stages, and what might you be focusing on? Thanks. Okay. Thank you, Jaime. As we look at the $300 million upside that you referenced from an HDFS perspective, we will likely end up closing the, I think we've announced we're closing in the second half of the year. Due to the sort of complexity of this, as we settle different elements of the transaction, there will probably be some elements that close in Q3 and also some elements that close in Q4. As we look at different tranches of the loans and some different buckets, it's kind of broken into those two quarters. We are going to make sure that we are clearly working with our partners, KKR and PIMCO, on the settlement of each of those pieces. More to come on that front. Jochen, I'll hand it over to you from an efficiency standpoint. Yes. Jonathan already talked about our $400 million productivity gain commitment that we've made that we will be overachieving by about 10%. We have identified new opportunities to further those productivities and increase those productivity gains, but we also see significant opportunity in a new efficiency program, details of which will be outlined in future earnings calls. We believe that especially technology, including AI, will really help drive substantial cost savings for the business and will affect the overall structure of the business going forward to drive further productivity gains across the entire business. Rest assured, the decisions that we are taking in this regard will be aligned, closely aligned with the board and then the incoming CEO. There's full alignment in the handover process and the transition process with regards to this efficiency program as well. We're not going to go into detail, but we feel confident that there are a number of activities that we can start immediately and many more to follow until the end of the year to really change the model quite significantly, also with the help of AI. There are no further questions at this time. This concludes today's conference call. Thank you all for joining. You may now disconnect.