8-K
LiveWire Group, Inc. (LVWR)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 8, 2024
LiveWire Group, Inc.
(Exact name of registrant as specified in its charter)
| Delaware | 001-41511 | 87-4730333 |
|---|---|---|
| (State or other jurisdiction<br>of incorporation) | (Commission<br> File Number) | (IRS Employer<br>Identification No.) |
3700 West Juneau Avenue, Milwaukee, Wisconsin 53208
(Address of principal executive offices, including zip code)
(650) 447-8424
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c) |
| --- | --- |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of exchange on which registered |
|---|---|---|
| Common Stock, $0.0001 par value per share | LVWR | New York Stock Exchange |
| Warrants to purchase common stock | LVWR WS | New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.02 | Results of Operations and Financial Condition. |
|---|
On February 8, 2024, LiveWire Group, Inc. (the “Company”) issued a press release (the “Press Release”) announcing the Company’s fourth quarter results for the financial period ended December 31, 2023. A copy of the Press Release is being furnished as Exhibit 99.1 to this Current Report on Form 8-K.
| Item 9.01 | Financial Statements and Exhibits. |
|---|
(a)Not applicable.
(b)Not applicable.
(c)Not applicable.
(d)Exhibits. The following exhibit is being furnished herewith:
| Exhibit No. | Description |
|---|---|
| 99.1 | Press Release of LiveWire Group, Inc. dated February 8, 2024 |
| --- | --- |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| LiveWire Group, Inc. | |
|---|---|
| Date: February 8, 2024 | /s/ Tralisa Maraj |
| Tralisa Maraj | |
| Chief Financial Officer |
2
Document
FOR IMMEDIATE RELEASE
LIVEWIRE GROUP, INC. REPORTS 2023 FOURTH QUARTER AND FULL YEAR FINANCIAL RESULTS
MILWAUKEE, WI (February 8, 2024) – LiveWire Group, Inc. (“LiveWire” or the “Company”) (NYSE: LVWR) today reported fourth quarter and full year 2023 results.
“LiveWire concluded 2023 with a strong Q4 performance, delivering on units and operating loss guidance for the full year with the successful delivery to market of S2 Del Mar®, the first model built on our S2 platform that continues to generate a positive response from the media, our retailers, and our riders. We expect 2024 to be a year highlighted by product innovation, market expansion, and continued cost improvements,” said Karim Donnez, CEO, LiveWire.
2023 Highlights and Financial Results
•Launched Del Mar, the first model built with an all-new in-house developed battery pack, power electronics, motor, telematics, and associated software
•Unit sales of 660 electric motorcycles, up double digits versus prior year
•Consolidated operating loss in line with our expectations driven by product development costs relating to S2 platform, delivery of Del Mar, a provision for an obligation for excess inventory components, and additional costs to stand up the organization as a stand-alone public company
•Ended the year with 126 retail partners globally
Fourth Quarter 2023 Summary of Results
•Unit sales of 514 electric motorcycles, with an increase in consolidated revenue of 64% versus prior year
•Consolidated operating loss increase over prior year of $4.9 million resulting primarily from costs related to increased volume and a provision for an obligation for excess inventory components
•Continued investment in developing models on the S2 platform
LiveWire Group, Inc. – Consolidated Results
| in millions* | 4th quarter | Full Year | |||||||
|---|---|---|---|---|---|---|---|---|---|
| 2023 | |||||||||
| Revenue | 15.1 | 9.2 | 64 | % | 38.0 | 46.8 | (19 | %) | |
| Operating (Loss) | (33.8) | (28.9) | 17 | % | (116.0) | (85.0) | 36 | % | |
| Net Loss | (33.1) | (22.4) | 48 | % | (109.6) | (78.9) | 39 | % |
All values are in US Dollars.
LiveWire Group, Inc. – Segment Results
| in millions*, except units | 4th quarter | Full Year | |||||||
|---|---|---|---|---|---|---|---|---|---|
| 2023 | |||||||||
| Electric Motorcycles | |||||||||
| LiveWire (units) | 514 | 69 | 645 | % | 660 | 547 | 21 | % | |
| Harley-Davidson LiveWire (units) | — | — | 0 | % | — | 50 | (100 | %) | |
| Electric Motorcycle Shipments (units) | 514 | 69 | 645 | % | 660 | 597 | 11 | % | |
| Revenue | 8.0 | 1.6 | 400 | % | 11.5 | 14.0 | (18 | %) | |
| Operating (Loss) | (34.2) | (29.7) | 15 | % | (116.6) | (89.1) | 31 | % |
All values are in US Dollars.
| in millions* | 4th quarter | Full Year | |||||||
|---|---|---|---|---|---|---|---|---|---|
| 2023 | |||||||||
| STACYC Segment | |||||||||
| Revenue | 7.1 | 7.6 | (7 | %) | 26.5 | 32.8 | (19 | %) | |
| Operating Income | 0.4 | 0.8 | (50 | %) | 0.6 | 4.2 | (86 | %) |
All values are in US Dollars.
*Amounts may not add up due to rounding
The Company’s consolidated net loss was $109.6 million for the year ended 2023 compared to $78.9 million for the year ended 2022. The increase of $30.7 million was in line with our expectations driven by a provision for an obligation for excess inventory components, increased selling, administrative and engineering expense for product development costs relating to the S2 platform, delivery of Del Mar and additional costs to stand up the organization as a stand-alone public company. The Company also had an increase of $9.1 million of non-operating mark-to-market expense resulting from the increase in the fair value of warrant liabilities year-over-year which was offset by an increase of $9.3 million in interest income.
The Company’s consolidated net loss was $33.1 million for the fourth quarter 2023 as compared to $22.4 million in the same period prior year driven by the segment results noted below, an increase of $6.7 million of non-operating mark-to-market expense related to the increase in fair value of the outstanding warrants as of December 31, 2023 as compared to December 31, 2022, offset by an increase of $1.2 million in interest income.
LiveWire Group, Inc. is comprised of two business segments:
•Electric Motorcycles – focused on the sale of electric motorcycles and related products
•STACYC – focused on the sale of electric balance bikes for kids and related products
Electric Motorcycles
Electric Motorcycle revenue increased in fourth quarter 2023 compared to the same quarter in the prior year due to sales of Del Mar units. Increased operating losses compared to the fourth quarter of 2022 were primarily related to increased costs as a result of increased volumes and a provision for an obligation for excess inventory components.
STACYC
STACYC volumes were up in the fourth quarter of 2023 compared to 2022, while revenue and operating income were down due to product mix and pricing.
2024 Financial Outlook
For the full year 2024, the Company expects:
•Electric Motorcycle sales of 1,000 to 1,500 revenue units
•Operating Loss of $115 million to $125 million
Webcast
The public is invited to attend an audio webcast from 8-9 a.m. CST. LiveWire leadership will be joining the Harley-Davidson, Inc. audio webcast to discuss our results, developments in the business, and updates to the Company’s outlook. The webcast login can be accessed at https://investor.livewire.com/news-events-1/events/default.aspx. The audio replay will be available by approximately 10:00 a.m. CST.
About LiveWire
LiveWire has a dedicated focus on the electric motorcycle sector. LiveWire’s majority shareholder is Harley-Davidson, Inc. LiveWire comes from the lineage of Harley-Davidson and is capitalizing on a decade of its learnings in the EV sector. With a dedicated focus on EV, LiveWire plans to develop the technology of the future and to invest in the capabilities needed to lead the transformation of motorcycling. www.livewire.com
Cautionary Note Regarding Forward-Looking Statements
The Company intends that certain matters discussed in this press release are “forward-looking statements” intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts contained in this press release, including statements concerning possible or assumed future actions, business strategies, events or results of operations, and any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Words or phrases such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “objective,” “ongoing,” “plan,” “potential,” “predict,” “project,” “should,” “will” and “would,” or similar words or phrases, or the negatives of those words or phrases, may identify forward-looking statements, but the absence of these words does not necessarily mean that a statement is not forward-looking. The forward-looking statements in this press release are only predictions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. These forward-looking statements speak only as of the date of this press release and are subject to a number of important factors that could cause actual results to differ materially from those in the forward-looking statements, including the risks, uncertainties and assumptions described in prior public filings titled “Risk Factors.” These forward-looking statements are subject to numerous risks, including, without limitation, the following: our history of losses and expectation to incur significant expenses and continuing losses for the foreseeable future; our limited operating history, the rollout of our business and the timing of expected business milestones, including our ability to develop and manufacture electric vehicles of sufficient quality and appeal to customers on schedule and on a large scale; our financial and business performance, including financial projections and business metrics and any underlying assumptions thereunder; changes in our strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects and plans; our ability to attract and retain a large number of customers; our future capital requirements and sources and uses of cash; our ability to obtain funding for our operations and manage costs; challenges we face as a pioneer into the highly-competitive and rapidly evolving electric vehicle industry; our operational and financial risks if we fail to effectively and appropriately separate the LiveWire business from the H-D business; H-D making decisions for its overall benefit that could negatively impact our overall business; our relationship with H-D and its impact on our other business relationships; our ability to leverage contract manufacturers, including H-D and Kwang Yang Motor Co., Ltd., a Taiwanese company (“KYMCO”), to contract manufacture our electric vehicles; retail partners being unwilling to participate in our go-to-market business model or their inability to establish or maintain relationships with customers for our electric vehicles; potential delays in the design, manufacture, financing, regulatory approval, launch and delivery of our electric vehicles; building out our supply chain, including our dependency on our existing suppliers and our ability to source suppliers, in each case many of which are single-sourced or limited-source suppliers, for our critical components such as batteries and semiconductor chips; our ability to rely on third-party and public charging networks; our ability to attract and retain key personnel; our business, expansion plans and opportunities, including our ability to scale our operations and manage our future growth effectively; the effects on our future business of competition, the pace and depth of electric vehicle adoption generally and our ability to achieve planned competitive advantages with respect to our electric vehicles and products, including with respect to reliability, safety and efficiency; our business and H-D’s business overlapping and being perceived as competitors; our inability to maintain a strong relationship with H-D or to resolve favorably any disputes that may arise between us and H-D; our dependency on H-D for a number of services, including services relating to quality and safety testing. If those service arrangements terminate, it may require significant investment for us to build our own safety and testing facilities, or we may be required to obtain such services from another third-party at increased costs; any decision by us to electrify H-D products, or the products of any other company; our expectations regarding our ability to obtain and maintain intellectual property protection and not infringe on the rights of others; potential harm caused by misappropriation of our data and compromises in cybersecurity; changes in laws, regulatory requirements, governmental incentives and fuel and energy prices; the impact of health epidemics, including the COVID-19
pandemic, on our business, the other risks we face and the actions we may take in response thereto; litigation, regulatory proceedings, complaints, product liability claims and/or adverse publicity; and the possibility that we may be adversely affected by other economic, business and/or competitive factors. Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified and some of which are beyond our control, you should not rely on these forward-looking statements as predictions of future events. The events and circumstances reflected in our forward-looking statements may not be achieved or occur, and actual results could differ materially from those projected in the forward-looking statements. Moreover, we operate in an evolving environment. Some of these risks and uncertainties may in the future be amplified by new risk factors and uncertainties that may emerge from time to time, and it is not possible for management to predict all risk factors and uncertainties. As a result of these factors, we cannot assure you that the forward-looking statements in this press release will prove to be accurate. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained herein, whether as a result of any new information, future events, changed circumstances, or otherwise. You should read this earnings release completely and with the understanding that our actual future results may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements.
Media Contact: Jenni Coats (414) 343-7902
Financial Contact: Shawn Collins (414) 343-8002
LiveWire Group, Inc.
Consolidated Statements of Operations
(In thousands, except per share amounts)
| (Unaudited) | (Unaudited) | (Unaudited) | ||||||
|---|---|---|---|---|---|---|---|---|
| Three months ended | Twelve months ended | |||||||
| December 31,<br>2023 | December 31,<br>2022 | December 31,<br>2023 | December 31,<br>2022 | |||||
| Revenue, net | $ | 15,091 | $ | 9,218 | $ | 38,023 | $ | 46,833 |
| Costs and expenses: | ||||||||
| Cost of goods sold | 20,279 | 6,942 | 43,795 | 43,929 | ||||
| Selling, administrative and engineering expense | 28,567 | 31,153 | 110,217 | 87,859 | ||||
| Total operating costs and expenses | 48,846 | 38,095 | 154,012 | 131,788 | ||||
| Operating loss | (33,755) | (28,877) | (115,989) | (84,955) | ||||
| Other income, net | — | — | — | 235 | ||||
| Interest expense related party | — | — | — | (475) | ||||
| Interest income | 2,365 | 1,214 | 10,537 | 1,191 | ||||
| Change in fair value of warrant liabilities | (1,688) | 5,033 | (4,020) | 5,033 | ||||
| Loss before income taxes | (33,078) | (22,630) | (109,472) | (78,971) | ||||
| Income tax (benefit) provision | 15 | (192) | 78 | (33) | ||||
| Net loss | $ | (33,093) | $ | (22,438) | $ | (109,550) | $ | (78,938) |
| Net loss per share, basic and diluted | $ | (0.16) | $ | (0.11) | $ | (0.54) | $ | (0.46) |
| Weighted-average shares, basic and diluted | 202,672 | 202,404 | 202,504 | 172,003 |
LiveWire Group, Inc.
Consolidated Balance Sheets
(In thousands)
| (Unaudited) | ||||
|---|---|---|---|---|
| December 31,<br>2023 | December 31,<br>2022 | |||
| ASSETS | ||||
| Current assets: | ||||
| Cash and cash equivalents | $ | 167,904 | $ | 265,240 |
| Accounts receivable, net | 4,295 | 2,325 | ||
| Accounts receivable from related party | 3,402 | 525 | ||
| Inventories, net | 32,122 | 29,215 | ||
| Other current assets | 3,004 | 4,625 | ||
| Total current assets | 210,727 | 301,930 | ||
| Property, plant and equipment, net | 38,483 | 31,567 | ||
| Goodwill | 8,327 | 8,327 | ||
| Deferred tax assets | 4 | — | ||
| Lease assets | 1,868 | 3,128 | ||
| Intangible assets, net | 1,347 | 1,809 | ||
| Other long-term assets | 6,192 | 5,044 | ||
| Total assets | $ | 266,948 | $ | 351,805 |
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||
| Current liabilities: | ||||
| Accounts payable | $ | 3,554 | $ | 7,055 |
| Accounts payable to related party | 20,371 | 5,733 | ||
| Accrued liabilities | 21,990 | 20,343 | ||
| Current portion of lease liabilities | 1,152 | 1,312 | ||
| Total current liabilities | 47,067 | 34,443 | ||
| Long-term portion of lease liabilities | 792 | 1,913 | ||
| Deferred tax liabilities | 93 | 15 | ||
| Warrant liabilities | 12,319 | 8,388 | ||
| Other long-term liabilities | 814 | 246 | ||
| Total liabilities | 61,085 | 45,005 | ||
| Shareholders' equity: | ||||
| Preferred Stock | — | — | ||
| Common Stock | 20 | 20 | ||
| Treasury Stock | (1,969) | — | ||
| Additional paid-in-capital | 339,783 | 329,218 | ||
| Accumulated deficit | (131,988) | (22,438) | ||
| Accumulated other comprehensive income | 17 | — | ||
| Total shareholders' equity | 205,863 | 306,800 | ||
| Total liabilities and shareholders' equity | $ | 266,948 | $ | 351,805 |
LiveWire Group, Inc.
Consolidated Statements of Cash Flows
(In thousands)
| (Unaudited) | ||||
|---|---|---|---|---|
| Twelve months ended | ||||
| December 31,<br>2023 | December 31,<br>2022 | |||
| Cash flows from operating activities: | ||||
| Net loss | $ | (109,550) | $ | (78,938) |
| Adjustments to reconcile net loss to net cash used in operating activities | ||||
| Depreciation and amortization | 4,993 | 4,401 | ||
| Payment of contingent consideration in excess of acquisition date fair value | — | (413) | ||
| Change in fair value of warrant liabilities | 4,020 | (5,033) | ||
| Stock compensation expense | 8,926 | 394 | ||
| Provision for doubtful accounts | 53 | 145 | ||
| Deferred income taxes | 74 | (125) | ||
| Inventory write-down | 2,719 | 1,074 | ||
| Cloud computing arrangements development costs | (473) | (4,894) | ||
| Other, net | (117) | (144) | ||
| Changes in current assets and liabilities: | ||||
| Accounts receivable, net | (2,023) | 4,156 | ||
| Accounts receivable from related party | (2,877) | (593) | ||
| Inventories | (5,626) | (21,068) | ||
| Other current assets | 1,621 | (1,283) | ||
| Accounts payable and accrued liabilities | 160 | 6,371 | ||
| Accounts payable to related party | 14,638 | 6,269 | ||
| Net cash used by operating activities | (83,462) | (89,681) | ||
| Cash flows from investing activities: | ||||
| Capital expenditures | (13,462) | (14,081) | ||
| Net cash used by investing activities | (13,462) | (14,081) | ||
| Cash flows from financing activities: | ||||
| Repurchase of common stock | (1,969) | — | ||
| Proceeds received from sale of warrants | 1,557 | — | ||
| Borrowings on notes payable to related party | — | 15,333 | ||
| Net proceeds from the Business Combination | — | 293,717 | ||
| Payment of contingent consideration up to acquisition date fair value | — | (1,767) | ||
| Transfers from Parent | — | 59,051 | ||
| Net cash provided (used) by financing activities | (412) | 366,334 | ||
| Cash and cash equivalents: | ||||
| Cash and cash equivalents—beginning of period | $ | 265,240 | $ | 2,668 |
| Net increase (decrease) in cash and cash equivalents | (97,336) | 262,572 | ||
| Cash and cash equivalents—end of period | $ | 167,904 | $ | 265,240 |
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