Patrick Industries, Inc. (PATK)

How it makes money

Revenue comes from selling physical components to original equipment manufacturers and to dealers, on a per-unit basis: Patrick earns money every time an RV, a boat or a manufactured home is built and fitted out. There is no subscription and no recurring licence — volumes track the production schedules of a handful of large OEMs. Two levers drive the top line beyond industry volumes: 'content per unit', meaning how many dollars of Patrick parts end up in each vehicle or home, and acquisitions, which the company uses routinely to add product lines and new end markets (powersports became a separate reported market after the Sportech acquisition in January 2024). A growing aftermarket business sells replacement and upgrade parts to owners.

Revenue by segment

Patrick's advantage is breadth and proximity rather than pricing power. With around 241 plants and distribution centres, many of them clustered near the RV manufacturing belt in northern Indiana, it can supply a very wide range of parts on short notice and take on more of the bill of materials of a single vehicle than smaller suppliers can. That makes it convenient to keep, but the products themselves are largely commodity building materials, the customers are far larger than Patrick, and nothing in the filing points to contracts or switching costs that would lock them in.

Everything Patrick supplies ends up inside a purchase a household can postpone: a motorhome, a boat, a side-by-side, a new manufactured home. Demand therefore follows consumer confidence, disposable income and above all the cost and availability of credit, since most of these purchases are financed. It is amplified by a second layer: Patrick sells to OEMs, and OEMs cut production harder than retail sales fall when dealers are working down inventory, so the company's volumes swing more than the underlying retail cycle. Management's own commentary on 2025 described OEMs and dealers holding disciplined production and inventory levels while waiting for a retail inflection.

Key risks

• Cyclicality and seasonality of the end markets — The company states that economic and business conditions beyond its control, including cyclicality and seasonality in the industries it sells into, could cause its operating results to fluctuate and hurt them. RV, marine, powersports and manufactured housing are all subject to cycles of growth and contraction in consumer demand.
• Dependence on the RV industry — A material percentage of sales is concentrated in the RV industry. The filing warns that declines in the level of RV unit shipments, or a slowdown in industry growth, would reduce demand for its products and hurt operating results.
• Two customers account for a combined 28% of sales — The company discloses that two RV customers accounted for a combined 28% of consolidated net sales in 2025, and states that losing either one could have a material adverse impact on its operating results and financial condition.
• Inflation and raw material costs — Operating results can be adversely affected by inflation and by changes in the cost or availability of raw materials, energy, transportation and other necessary supplies and services — a direct exposure for a business built on lumber, panels, aluminium and resins.
• Supply chain disruption — The company flags supply chain issues — including financial problems at its own manufacturers or suppliers, or a shortage of materials or manufacturing capacity — that could raise costs or delay its ability to fill orders.
• Credit availability and consumer financing — Among its risk factors the company lists the availability of credit markets and the financial condition of its customers and suppliers. Demand for the big-ticket, discretionary products Patrick supplies depends on consumers and dealers being able to finance them.

Top customers account for 28% of revenue

The 10-K states that sales to the various businesses of Forest River and Thor Industries, on a combined basis, accounted for 28% of consolidated net sales in 2025, against 29% in both 2024 and 2023. Each of the two exceeds the 10% disclosure threshold on its own. These are the two dominant RV manufacturers in North America, so Patrick's largest customers are also the buyers with the most leverage over its pricing.