AddedRisk Factors
Growth of the data center market is difficult to project and may not be sustaining, and we may not be successful in achieving our growth, revenue, or profitability objectives in the future related to it.
The 10-K against last year's
68 changes: 15 added, 2 removed, 49 reworded, 2 quiet changes
10-K 0001437749-26-004568 (2026-02-18) vs 10-K 0001437749-25-004353 (2025-02-19)
The redline
The paragraph that changed most in each section
Marked against last year's 10-K:
cut words struck through, new words highlighted and underlined.
MD&A 247 words changed in this paragraph; it is 40% similar to last year's version.
Source: Item 7, 10-K 0001437749-26-004568 vs Item 7, 10-K 0001437749-25-004353
Accounting Policies 148 words changed in this paragraph; it is 80% similar to last year's version.
Source: Item 8, Note 2 – Summary of Accounting Policies, 10-K 0001437749-26-004568 vs Item 8, Note 2 – Summary of Accounting Policies, 10-K 0001437749-25-004353
Risk Factors 98 words changed in this paragraph; it is 83% similar to last year's version.
Difficulties or delays in research, development or production of new or enhanced products or failure to gain market acceptance of new or enhanced products and technologies may reduce future sales and adversely affect our competitive position. We continue to invest in the development and marketing of new or enhanced products. There can be no assurance that we will have sufficient resources to make such investments, that we will be able to make the technological advances necessary to maintain competitive advantages or that we can recover major research and development expenses. If we do not continue to strategically advance our product portfolio to maintain our technology leadership, our competitive position could be adversely affected. Certain of our products benefit from government incentive or tax credit programs and we cannot be assured that these incentive or tax credit programs will be maintained and for how long. On July 4, 2025, the United States enacted the OBBBA, which introduced substantial tax law changes, eliminates or reduces several tax credits and incentives applicable to energy related technologies, which has and may continue to negatively impact our business in the short term. For example, in July 2024, we received a grant from the U.S. Department of Energy (DOE) to facilitate the installation of residential solar and battery storage systems for disadvantaged Puerto Rican residents that, if fully realized and not terminated early, would provide up that the DOE has elected to $120 million stop funding going forward in funds over the duration of the five-year award agreement. 2026. If we fail to make innovations, experience unexpected delays and/or quality problems in launching products, or the market does not accept our new products, our financial condition, results of operations, cash flows and liquidity could be adversely affected. In addition, as new or enhanced products are introduced, we must successfully manage the transition from older products to minimize disruption in customers’ ordering patterns, avoid excessive levels of older or obsolete product inventories and ensure that we can deliver sufficient supplies of new products to meet customers’ demands.
Source: Item 1A, 10-K 0001437749-26-004568 vs Item 1A, 10-K 0001437749-25-004353
Legal Proceedings 85 words changed in this paragraph; it is 75% similar to last year's version.
On October 28, 2022, Daniel Haak filed a putative consumer class action lawsuit against Generac Power in the Middle District of Florida. The complaint alleges breaches of warranty, tort-based, and unjust enrichment claims against Generac Power relating to the sale and performance of certain clean energy products, and seeks to recover damages, including consequential damages, that the plaintiff and putative class allegedly incurred. Additional putative class actions were filed by consumers raising similar claims and allegations in other district court cases. These putative class actions have been consolidated into a Multidistrict Litigation, In re: Generac Solar Power Systems Marketing, Sales Practices and Products Liability Litigation currently pending in the Eastern District of Wisconsin, Case No. 23-md-3078. Generac Power and plaintiffs participated in a mediation through which the Company filed their answer parties agreed to certain monetary and non-monetary terms to resolve the consolidated master complaint after matter on a classwide basis. The parties have obtained preliminary approval for the court denied the motion to dismiss on May 24, 2024. classwide settlement and will be seeking final approval. Generac Power and has reserved for the Company intend to vigorously defend against contemplated $15,000 settlement fund. Generac Power does not concede liability or any charges of wrongdoing in connection with the consolidated master complaint. proposed settlement.
Source: Item 3, via Note 18 – Commitments and Contingencies, 10-K 0001437749-26-004568 vs Item 3, via Note 18 – Commitments and Contingencies, 10-K 0001437749-25-004353
Every change, by type
Sentences and paragraphs added, removed or reworded
Sentences and paragraphs of GNRC's Risk Factors and MD&A, 10-K 2026-02-18 against 10-K 2025-02-19. Each links to the text at sec.gov.
Quiet changes are sentences kept from last year with one to four words changed, at least one of them a hedge, a modal or a qualifier (may, could, will, not, significant, material…). A year or date rolling forward is not counted.
The full word list
adverse, adversely, all, although, anticipate, anticipates, any, approximately, believe, believes, can, cannot, certain, could, expect, expects, generally, however, if, intend, intends, largely, likely, many, material, materially, may, might, most, must, never, no, not, possible, primarily, probable, should, significant, significantly, some, substantial, substantially, unlikely, will, wouldAddedRisk Factors
The increasing use and development of artificial intelligence has created significant demand for the build out of data center infrastructure, which includes backup power generation. While we believe the potential for this business is very promising, the growth and development of this rapidly evolving industry is difficult to project. Our expectations regarding this market may not prove to be accurate or the market may not be sustainable. Our operating results may fluctuate moving forward as we develop this business and expand our offering of high output diesel generators. Our expectations around growth for this market may also place significant demands on our management team and require significant capital investment as well as other resources. The technical, operational, or general contractual requirements for certain large data center customers or projects can be significant. Challenges in meeting these requirements, due to evolving project specifications or changing customer or supplier circumstances, or other issues could result in delays, increased costs, reduced revenue, or reputational harm. Any such issues with our performance under these contracts could materially impact our net sales and operating results. We may not be able to address these challenges in a cost-effective manner or at all. If we do not effectively manage our growth, we may not be able to execute on our business plan, respond to competitive pressures, or take advantage of the market opportunities. All of these could have an impact on our future objectives for growth, revenue, or profitability as well as our financial results and operations.
RewordedRisk Factors
Department of Energy (DOE) to facilitate the installation of residential solar and battery storage systems for disadvantaged Puerto Rican residents that, if fully realized and not terminated early, would provide up that the DOE has elected to $120 million stop funding going forward in funds over the duration of the five-year award agreement. 2026.
RewordedRisk Factors
For certain products we rely upon contract outside manufacturers to build these products or supply these components, including but not limited to certain clean energy products or components. components and large engines used in data center backup applications.
RewordedRisk Factors
Commitments and Contingencies” and our discussion of “Non-GAAP measures – Adjusted EBITDA” in Item 7 8 of this Annual Report on Form 10-K.
RewordedRisk Factors
Although we currently maintain product liability insurance coverage, in certain cases such insurance coverage has not and may continue to not be sufficient to cover claims or damage awards or we may not be able to obtain such insurance on acceptable terms in the future, if at all, or obtain insurance that will provide adequate coverage against potential claims.
RewordedRisk Factors
While we attempt to mitigate these risks through board oversight, hiring additional internal cyber-security professionals to manage these risks, risk mitigations, enhancing controls, due diligence, employee training and communication, third party intrusion testing, system hardening, email and web filters, regular patching, multi-factor authentication, surveillance, encryption, and other measures, we remain vulnerable to inherent risks associated with information security threats.
RewordedRisk Factors
These changes include renegotiating and terminating certain existing bilateral or multi-lateral trade agreements, such as the U.S.-Mexico-Canada Agreement, and initiating tariffs on certain foreign goods from a variety of countries and regions, most notably China. China, India, or the EU.
Show the other 29
RewordedRisk Factors
These attacks pose a risk to the security of our products, private data, systems and networks and those of our customers, suppliers and third-party service providers, as well as to the confidentiality of our information and the integrity and availability of our data. data and related systems.
Quiet changesRisk Factors
We monitor certain cyber security threats and vulnerabilities in our systems, and we have experienced viruses and attacks targeting our IT systems and networks.
AddedMD&A
Impact of residential investment cycle. The market for our residential products is affected by the residential investment cycle and overall consumer confidence and sentiment. When homeowners are confident of their household income, the value of their home and overall net worth, they are more likely to invest in their home. These trends can have an impact on demand for residential generators, solar and energy storage systems, and energy management devices. Trends in interest rates and the new housing market, highlighted by residential housing starts, can also impact demand for these products. Demand for outdoor power equipment is also impacted by several of these factors, as well as weather patterns. The existence of renewable energy mandates, investment tax credits, and other subsidies can also have an impact on the demand for solar and energy storage systems. The “One Big Beautiful Bill Act” (OBBBA) that was enacted in the United States in July 2025 accelerated the phase out of certain investment tax credits, resulting in a negative impact to the solar & storage market thereafter.
AddedMD&A
Impact of business capital investment and other economic cycles. The global market for our C&I products is affected by different capital investment cycles, which can vary widely across the different regions and markets that we serve. These cycles include non-residential building construction, durable goods and infrastructure spending, as well as investments in the exploration and production of oil & gas, as businesses or organizations either add new locations or make investments to upgrade existing locations or equipment. These trends and market conditions can have a material impact on demand for our products. The capital investment cycle may differ for the various C&I end markets that we serve, including data centers, light commercial, retail, office, telecommunications, rental, industrial, healthcare, construction, oil & gas and municipal infrastructure, among others. The market for these products is also affected by general economic conditions around the world, fluctuations in interest rates & foreign currencies, trade policies, and geopolitical matters in the various countries where we serve, as well as credit availability in those regions.
AddedMD&A
Commodity, currency, and component price levels are increasingly subject to geopolitical uncertainty, including ongoing regional conflicts, shifts in U.S. and international trade policies, and the potential for new or increased tariffs. These factors, along with increased demand from data centers, have contributed to heightened volatility in commodity prices, particularly for raw materials such as steel, copper, and aluminum. Additionally, geopolitical instability can contribute to significant fluctuations in foreign currency exchange rates which can impact our reported financial performance from our foreign operations and supply chain.
AddedMD&A
Tariffs and international trade relations. Given our global supply chain and international operations, our business is impacted by tariffs and other changes in U.S. trade policy and international trade relations. For example, starting in the first quarter of 2025, the United States government enacted additional tariffs on goods imported into the U.S. from numerous countries, and certain countries announced tariffs on U.S. goods. Some of these tariffs have been subsequently modified or delayed, and the U.S. government has also stated it is willing to negotiate with respect to the tariffs it has enacted.
AddedMD&A
We have implemented price increases across many of our product offerings and are executing a number of supply chain initiatives to attempt to mitigate the impact of these tariffs on our profitability. Despite our efforts, these tariff actions and resulting price increases have created inflationary pressures for consumers, negatively impacting demand and margins for certain of our products. As U.S. trade policy continues to evolve, we will continue to evaluate the impact of future tariffs and take actions to mitigate and/or minimize their effects.
AddedMD&A
On July 1, 2025, we amended our Term Loan A Facility and Revolving Credit Facility, extending the maturity of both to July 1, 2030, revising the Term Loan A Facility outstanding principal balance to $700,000, reducing the Revolving Credit Facility borrowing capacity to $1,000,000, and redefining the Term Benchmark to replace the Adjusted Term SOFR Rate with the Term SOFR Rate, resulting in an interest rate spread reduction of 0.10%.
AddedMD&A
On July 4, 2025, the United States signed the OBBBA into law. This legislation makes permanent several key provisions related to 100% bonus depreciation and the immediate expensing of domestic research and development costs. Under ASC 740, “Income Taxes,” the effects of changes in tax laws are reflected in the Company’s financial statements in the quarter in which the legislation was passed. We expect to realize cash tax savings as a result of provisions related to bonus depreciation and domestic research and development expensing. These changes did not have a material impact on our effective income tax rate for 2025 as the changes relate to temporary differences in basis.
AddedMD&A
On July 1, 2025, we amended our Original Tranche A Term Loan Facility and Original Revolving Facility (Prior Amended Credit Agreement), extending the maturity of both to July 1, 2030, revising the Original Tranche A Term Loan Facility outstanding principal balance to $700 million (New Tranche A Term Loan Facility), reducing the Original Revolving Facility borrowing capacity to $1 billion (New Revolving Facility) (collectively the New Credit Agreements) and redefining the Term Benchmark (as defined in the Prior Amended Credit Agreement) to replace the Adjusted Term SOFR Rate (as defined in the Prior Amended Credit Agreement) with the Term SOFR Rate (as defined in the New Credit Agreements), resulting in an interest rate reduction of 0.10%. The New Tranche A Term Loan Facility is repayable in increasing quarterly installments over time, equal to 0.625% to 2.50% of the original principal amount, beginning on October 1, 2026. The New Tranche A Term Loan Facility and the New Revolving Facility bear interest at a rate based on SOFR plus an applicable margin between 1.25% and 1.75%, both based on our total leverage ratio and subject to a SOFR floor of 0.0%. As of December 31, 2025, the interest rate for the New Tranche A Term Loan Facility and the New Revolving Facility was 5.12%.
AddedMD&A
In accordance with ASC 470-50, we capitalized $5.3 million of debt issuance costs related to this refinancing transaction. Additionally, we wrote-off certain unamortized deferred financing costs related to the Original Revolving Facility of $0.4 million and expensed $0.8 million of third-party fees as a loss on refinancing of debt.
AddedMD&A
As of December 31, 2025, there was $494 million outstanding under the Term Loan B Facility, $700 million outstanding under the New Tranche A Term Loan Facility, and there were no borrowings on the New Revolving Facility, leaving $999.3 million of unused capacity, net of outstanding letters of credit.
AddedMD&A
In our October 31, 2025 impairment test calculation, the Clean Energy reporting unit had an estimated fair value that exceeded its carrying value by approximately 20%. The carrying value of the Clean Energy goodwill was $79.0 million. Key financial assumptions utilized to determine the fair value of the reporting unit include accelerating long-term demand growth due to a confluence of factors expected to drive power prices meaningfully higher in the future, cost improvements in renewable energy and energy storage technologies which are expected to improve profit margins, the development and launch of additional products, a 3% terminal growth rate and a 13.6% discount rate. The reporting unit’s fair value would approximate its carrying value with a 100 basis point increase in the discount rate or a 210 basis point reduction in the compound annual sales growth rate and terminal growth rate.
AddedMD&A
• A provision of $104.5 million, net in the fourth quarter of 2025 for a settlement agreement (in principle) related to a certain portable generator product liability case deemed outside the ordinary course of routine litigation for the Company.
RemovedMD&A
RemovedMD&A
RewordedMD&A
The $208.7 $172.9 million net cash used in investing activities for the year ended December 31, 2024 2025 primarily represents cash payments of $136.7 $169.9 million for the purchase of property and equipment (net of $11.1 $12.2 million of capital expenditures in accounts payable as of December 31, 2024), $35.0 2025), $3.0 million for an incremental minority investment in Wallbox N.V., $2.8 the purchase of long-term investments, and $3.1 million for a minority investment in Earth Foundry Fund, $1.6 million for a tax equity investment, and $34.7 million collectively for the acquisitions of Huntington, C&I BESS, Ageto, and Wolverine. related to other investing activities.
RewordedMD&A
Dollars in thousands) 2025 2024 2023 2022 Net income attributable to Generac Holdings Inc. $159,554 $316,315 $214,606 $399,502 Net income attributable to noncontrolling interests 1,800 663 2,514 9,368 Net income 161,354 316,978 217,120 408,870 Interest expense 70,697 89,713 97,627 54,826 Depreciation and amortization 194,835 171,768 166,602 156,141 Provision for income taxes 37,706 92,460 73,180 99,596 Non-cash write-down and other adjustments (a) 6,636 4,757 (5,953) (2,091) Non-cash share-based compensation expense (b) 49,947 49,248 35,492 29,481 Transaction costs and credit facility fees (c) 3,976 5,097 4,054 5,026 Business optimization and other charges (d) 7,301 4,752 10,551 4,371 Provision for legal, regulatory, and clean energy product charges other costs (e) 157,981 10,931 38,490 65,265 Change in fair value of investment investments (f) 20,610 38,006 - - Loss on extinguishment refinancing of debt (g) 1,225 4,861 - 3,743 Other 3,274 530 696 139 Adjusted EBITDA 715,542 789,101 637,859 825,367 Adjusted EBITDA attributable to noncontrolling interests 2,648 1,175 4,687 15,087 Adjusted EBITDA attributable to Generac Holdings Inc. $712,894 $787,926 $633,172 $810,280
RewordedMD&A
Dollars in thousands) 2025 2024 2023 2022 Net income attributable to Generac Holdings Inc. $159,554 $316,315 $214,606 $399,502 Net income attributable to noncontrolling interests 1,800 663 2,514 9,368 Net income 161,354 316,978 217,120 408,870 Amortization of intangible assets 101,507 97,743 104,194 103,320 Amortization of deferred financing costs and original issue discount 2,380 3,242 3,885 3,234 Transaction costs and other purchase accounting adjustments (a) 1,797 2,717 2,089 3,588 Loss/(gain) attributable to business or asset dispositions (b) 4,295 65 (119) (229) Business optimization and other charges (c) 7,301 4,752 10,551 4,371 Provision for legal, regulatory, and clean energy product charges other costs (c) 157,981 10,931 38,490 65,265 Change in fair value of investment investments (c) 20,610 38,006 - - Loss on extinguishment refinancing of debt (c) 1,225 4,861 - 3,743 Tax effect of add backs (80,658) (40,173) (38,384) (43,638) Adjusted net income 377,792 439,122 337,826 548,524 Adjusted net income attributable to noncontrolling interests 1,800 663 2,514 9,675 Adjusted net income attributable to Generac Holdings Inc. $375,992 $438,459 $335,312 $538,849
RewordedMD&A
The increase decrease in domestic segment sales for the year ended December 31, 2024, 2025, was primarily driven by an increase a decrease in residential product sales, most notably in home standby and portable generators following as a result of the elevated significantly lower power outage activity in the second half of the year. environment together with a strong prior year comparison which included multiple major landed hurricanes.
RewordedMD&A
Dollars in thousands) 2025 2024 2023 $ Change % Change Net cash provided by operating activities $ 437,978 $ 741,301 $ 521,670 $ 219,631 42.1% (303,323) -40.9% Net cash used in investing activities (172,904) (208,712) (178,063) (30,649) -17.2% 35,808 17.2% Net cash used in financing activities (212,719) (448,835) (277,137) (171,698) -62.0% 236,116 52.6% Effect of foreign exchange rate changes on cash and cash equivalents 7,781 (3,471) 1,801 (5,272) -292.7% 11,252 -324.2% Net increase in cash and cash equivalents $ 60,136 $ 80,283 $ 68,271 $ 12,012 17.6% (20,147) -25.1%
RewordedMD&A
RewordedMD&A
The increase decrease in other expense, net in 2024 2025 was driven primarily by a $38.0 million expense for reduced loss from the change in fair value of our investment in warrants and equity securities of Wallbox N.V., N.V. and a $4.9 million loss on extinguishment of debt. decrease in interest expense, as compared to the prior year.
RewordedMD&A
Adjusted Net Income was $376.0 million for the year ended December 31, 2025 compared to $438.5 million for the year ended December 31, 2024, compared to $335.3 million for the year ended December 31, 2023, with the increase decrease primarily due to higher lower net income in the current year as outlined above, together with the impact of various add-backs in the current and prior years.
RewordedMD&A
RewordedMD&A
Acquisitions in recent years have increased our use of advanced electronic components and battery cells, as well as further expanded our commercial cells that can fluctuate in terms of pricing and operational presence outside of the United States. availability.
RewordedMD&A
The increase decrease in net cash provided by operating activities was primarily driven by higher operating earnings coupled with a larger decrease significant reduction in net working capital in the current prior year period, which did not repeat and lower operating earnings as compared to the prior year.
RewordedMD&A
During the years ended December 31, 2024 2025, and 2023, 2024, we repurchased 1,109,206 shares of our common stock for $147.9 million, and 1,046,351 shares of our common stock for $152.7 million, and 2,188,475 shares for $251.5 million, respectively.
Quiet changesMD&A
(f) Represents non-cash losses primarily from changes in the fair value of the Company's investment in Wallbox N.V. warrants and equity securities.