LiveWire’s Final Short Circuit?

From LiveWire’s (LVWR) Form 8-K filed on Oct. 26, 2026:

LiveWire announced that its CEO for the last three years, Karim Donnez, resigned on Oct. 21. Karim’s resignation is significant, as it again brings to the surface every problem ailing LiveWire right now. To understand this, let’s step back and revisit the company’s Q2 numbers. Due to laziness For some reason, InsightEV didn’t post the Q2 numbers, so now’s a good time to revisit how bad the quarter was.

On the surface, Q2 saw 267 motorcycles being sold. That is a 385% jump over Q2 2025. The problem is that most of these sales were inventory-clearing, with LiveWire offering motorcycles at steep discounts. Some of us analysts went out on a limb and said these were honest prices, but none of us considered the havoc it was wreaking on the balance sheet.

LiveWire ended the quarter with net losses of USD 18.2 million. This may look slightly better than the USD 18.8 million net loss in Q2 FY25, but it was back in gloom-and-doom territory after a slight rebound over the last two quarters.

Recall that in this quarter, LiveWire also acquired Dust Moto (I will talk about that later), but the acquisition didn’t affect the net numbers much. I see a similar trend on an operating basis.

While revenues rose to USD 3.6 million, in line with the increase in sales, operating losses stayed at USD 18 million. Over the last 12 months, LiveWire has burned through nearly USD 71 million in operating losses in its motorcycle business. The number to worry about is not the USD 18 million operating loss in Q2 FY26. The bigger worry is that over the last four years, Livewire has incurred operating losses of more than USD 400 million, and losses are rising as revenue increases.

They are likely gross-margin negative.

That number, in a way, illustrates the business’s futility and the CEO’s ineffectiveness. LiveWire had few levers to pull to cut costs and bring operating margins into acceptable territory. They had already shut down the high-cost California development facility and moved the engineers, or anyone else willing to move, to the Harley headquarters in Milwaukee. There aren’t many low-hanging apples left.

On the other hand, history shows losses increase when prices are cut (duh!). The price point at which American motorcyclists will embrace high-powered electric motorcycles is much lower than LiveWire’s current prices. The problem is that if they are likely gross-margin negative at the high price point, they would be worse off at the lower price point, so increasing sales will be extremely challenging.

The stubbornness of the losses also indicates a structural problem at Livewire. Even a significant cash injection or a sales boost to a much higher level may not reduce losses.

That’s pretty much a rock-paper-scissors situation. That also creates a big question about whether the business is really salvable.

STACYC Better than Motorcycles but Cannot Save the Company

In its infinite wisdom, Harley-Davidson clubs its kids’ and balance bikes business, STACYC, under LiveWire. The only thing in common is that both use electric powertrains.

Harley didn’t organically create STACYC. It was acquired in 2019 to bring younger riders into the Harley fold and eventually move them from kids’ bicycles to Harley-Davidson motorcycles. It sounds a little ludicrous that the strategy team really thought a kid riding a balance bike would then jump onto a Harley-Davidson without any intermediate excursions to other brands and smaller, say 125cc, motorcycles.

Compared to LiveWire, the STACYC division does a much better job, financially. Early in the decade, at the business’s peak, they were decently profitable. Since then, they have gone through a lean patch with a drastic drop in sales in 2024 and much of 2025, before resuming recovery at the end of 2025. Right now, the business is flat but nowhere near as bad as the motorcycle division.

The Need for Restructuring

I have been clear from the start that LiveWire, as a business, has little plausibility. InsightEV has covered the brand extensively and, in every write-up, questioned the future prospects.

LiveWire’s core business idea was that Hell’s Angels wannabes the typical Harley-Davidson buyers, would become climate enthusiasts and switch from their gas-guzzling V-twins to electric motorcycles.

Read that again…

Over the last five years, I have realized that American motorcyclists aren’t moving to electric motorcycles, especially high-powered, expensive ones. Europe, though more environmentally conscious, has shallower pockets, is highly fragmented, and leaves little room for LiveWire. The company’s numbers would always be challenging.

Add to that, a high cost base makes things difficult at the other end. With Harley-Davidson’s financial backing, LiveWire took a no-holds-barred approach to engineering. They ended up getting a California design base and creating multiple platforms, including the Arrow (S2) platform, which uses a structural battery pack. They focused on sound engineering, and the products were immaculate and well received.

All of that was fine, but Livewire burned through cash fast.

In real numbers, more than USD 400 million in operating losses while selling fewer than 3,000 motorcycles over four years is bad, whichever way you may want to slice the data.

Things got worse when Harley-Davidson itself ran into problems. I touched on that in May when I discussed the company’s compounding problems, now that H-D is no longer at its prime. The small bleeding wound that Livewire was would no longer be looked at with kindness, now that Harley had more group-level problems.

Cash problems…Finally

The last few times I’ve covered LiveWire, I’ve said the company, thanks to Harley’s backing, doesn’t have immediate cash problems. I think that period is quickly drawing to a close, given the very high cash burn. There is a limit to what Harley-Davidson can put in. Other significant investors like KYMCO don’t seem interested in injecting fresh equity.

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The cash position is finally becoming wobbly. Between December 2025 and June 2026, cash and equivalents dropped to USD 52.9 million, from USD 82.8 million. Operating activities used USD 26.4 million of that burn, roughly USD 4.4 million per month. At that rate, LiveWire would have less than USD 40 million in cash at the end of Sept 2026 and about USD 25 million at year-end.

Immediate restructuring was critical.

Restructuring Committee

A key part of LiveWire’s announcement is that the company has formed a restructuring committee led by a Chief Restructuring Officer. Roy Gallagher, a Senior Managing Director at Ankura Consulting Group, has been appointed as the CRO. He will be paid USD 140k per month during the restructuring exercise. Effectively, Ankura is responsible for the restructuring exercise, and other staff members from the group would be paid on an hourly basis.

As things stand, restructuring here likely means finding a buyer for the entire business or part of it.

The board also appointed two new directors, David Barse and Scott Nash. Barse is an independent director and will receive a USD 45k monthly fee while he serves, plus a $7,500 per diem in certain circumstances related to legal actions. Nash is Harley-Davidson’s General Manager of Quality and receives no additional pay.

What is likely to happen?

The restructuring committee will likely consider major changes to the business, since small changes have not turned things around. Given the two clean parts of the business (balance bikes and electric motorcycles), the committee will likely seek buyers for one or both parts. Finding a buyer for STACYC may be easier than finding one for the Livewire motorcycle business.

Either way, the process could be long and drawn out because electric mobility, for the Global North enthusiast market, isn’t exactly hot. That also means Livewire’s immediate plans for product launches and rollouts wouldn’t be affected. Despite its problematic history, Livewire has been intent on setting things right. The S4 Honcho range, 125cc-equivalent minibikes aimed at new riders, is hitting showrooms, and the bikes look good and sellable.

Dust Moto Acquisition

The other thing to look forward to is the upcoming Dust Moto motocrosser. LiveWire acquired the Colin Godby-led, Oregon-based startup in May 2026.

Dust Hightails to Livewire InsightEV · May 20, 2026 Read full story

Under the acquisition agreement, LiveWire paid USD 375k in cash and USD 500k in stock upfront, plus three annual installment payments of USD 875k each in stock. The deal also includes an earn-out opportunity of up to USD 11.25 million, also paid in stock.

The acquisition matters because, unlike any other motorcycle format, motocross works well with electric powertrains. Stark Future proves it is possible to make money with electric motocrossers. It also sets an example for others.

The Dust Hightail is a mid-level motocrosser, created to be less extreme than the Starks. This makes the motorcycle extremely fun, without the sharpness newer riders often find challenging.

No Replacement CEO Announced

While announcing Karim Donnez’s departure, LiveWire made no mention of a replacement CEO or a search for one. They have also been without a CFO since 2025. This makes it likely that the restructuring may end with the sale of assets or parts of the business. Anything that can recapitalize LiveWire, that is.