Wed, Jun 18, 7:08 PM (25 days ago)
**Summary of American Honda Finance Corporation (AHFC) 10-K Filing for Fiscal Year Ended March 31, 2025** **Company Overview:** American Honda Finance Corporation (AHFC) is a wholly-owned subsidiary of American Honda Motor Co., Inc. (AHM), which is a subsidiary of Honda Motor Co., Ltd. (HMC). AHFC provides various forms of financing to authorized independent dealers of Honda and Acura products and their customers in the United States and Canada. **Financial Performance:** - **Revenue:** $9,489 million for fiscal year 2025, up from $8,405 million in 2024. - **Net Income:** $1,177 million for fiscal year 2025, up from $1,099 million in 2024. - **Earnings per Share (EPS):** Not explicitly stated, but net income attributable to AHFC was $1,110 million for fiscal year 2025. - **Operating Expenses:** General and administrative expenses were $597 million for fiscal year 2025. - **Provision for Credit Losses:** $306 million for fiscal year 2025. - **Early Termination Loss on Operating Leases:** $136 million for fiscal year 2025. **Strategic Overview:** AHFC focuses on supporting the sale of Honda and Acura products and maintaining customer and dealer satisfaction and loyalty. The company seeks to maintain competitive cost of funds, efficient operations, and effective risk and compliance management. **Future Outlook:** AHFC's future performance will depend on the volume of Honda and Acura sales, the portion of those sales that AHFC finances, the cost of funds, competition from other financial institutions, consumer credit defaults, and used motor vehicle prices. The company's liquidity is largely dependent on access to credit markets. **Risk Factors:** - **Market Risks:** Interest rate and foreign currency risks are managed using derivative instruments. - **Credit Risk:** Managed through underwriting standards, pricing contracts for expected losses, and collection efforts. - **Operational Risks:** Includes cybersecurity breaches, natural disasters, and supply chain disruptions. - **Regulatory Risks:** Subject to various U.S. and Canadian regulations, which could increase compliance costs. **Financial Condition:** - **Liquidity:** AHFC maintains a diversified funding strategy, including commercial paper, medium-term notes, bank loans, and asset-backed securities. - **Debt:** Total outstanding debt was $62,547 million as of March 31, 2025. - **Cash and Cash Equivalents:** $4,052 million as of March 31, 2025. **Market Position Changes:** AHFC competes with national, regional, and local finance companies, commercial banks, credit unions, savings and loan associations, online banks, and other captive finance companies. The company's ability to maintain and expand its market share depends on offering competitive pricing, quality of credit accepted, flexibility of loan terms, quality of service, and strong dealer relationships. **Amendments:** Not applicable, as this is a standard annual filing with no significant amendments noted.