Golf One Media

Topgolf Callaway Stock Price Dips

by | Nov 9, 2023 | BUSINESS

Topgolf Callaway Brands (NYSE: MODG) reports Q3 nine-month revenue at $3.4 billion, a nearly seven percent increase compared to the same period in 2022. YTD earnings drop 25% to $231 million.

On Nov.8, however, it revised its full-year g $4.235B- $4.260B  (consensus of $4.41B) compared to previous guidance of $4.430B to $4.470B. The revised guidance caused Topgolf Callaway Brands stock today to dip to a 52-week low of $10.11 in early morning trading

Topgolf Callaway Brands President/CEO Chip Brewer said the company is  “taking decisive action” to both costs, and capital expenditures and to drive additional synergies.

“All of this is aimed at de-risking future performance while maintaining our strong growth prospects,” Brewer said. “We remain on plan to deliver positive free cash flow for the total company and Topgolf this year and we are confident that we will continue to profitably grow our business this year and going forward.”

Golf equipment revenue declined one percent to $293 million, primarily due, according to the company, to an expected shift in equipment launch timing from Q3 to Q4 this year, softness in Asia, and a five percent decline in golf ball sales. The decline on ball sales, according to company CFO Brian Lynch, was due to the retail channel inventory catch-up in golf balls in Q3 2022.

Golf equipment operating income was $35 million, a decrease of $14 million compared to the prior year, due, Lynch said, due to less launch products in Q3 this year versus last year, a return to normal promotional levels, and lower production volumes this year versus 2022 and thus, less fixed cost absorption.

Topgolf revenue increased eight percent to $448 million, driven by the addition of nine new venues since Q3 2022 and partially offset by a decline of approximately three percent in same-venue sales during the quarter. Topgolf segment operating income increased 65 percent yearly to $39 million.

topgolfcallawaybrands.com

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About the Author

<a href="https://golfonemedia.com/author/steve_pike/" target="_self">Steve Pike</a>

Steve Pike

Steve “Spike” Pike is a lifelong journalist whose career covers Major League Baseball, the NFL, and college basketball. For the past 26 years, Spike has been one of the more respected voices in the golf and travel industries, working for such publications as Golfweek, Golf World, and Golf Digest for The New York Times Magazine Group. In 1998, Spike helped launch the PGA.com website for the PGA of America. As a freelance travel and golf writer, Spike’s travels have taken him around the world. He has played golf from Pebble Beach to St. Andrews, walked the Great Wall of China, climbed an active volcano in the Canary Islands, been on safari in South Africa, and dived with sharks off Guadalupe, Baja California. Steve lives in Delray Beach, Fla, and posts his golf and travel content on his website at spikeongolfandtravel.com. He can be reached at spikee41@hotmail.com.