Acushnet Holdings Corp’s Q1 2025 Earnings: Navigating Growth Amid Global Crosscurrents

As acushnet holdings corp. (NYSE: GOLF) prepares to report its first-quarter 2025 results on May 7, investors are closely watching how the golf equipment and apparel leader is navigating a year marked by currency headwinds, shifting consumer preferences, and geopolitical uncertainties. The company’s ability to sustain momentum in its core Titleist brand while addressing challenges in FootJoy will be critical to its ability to meet—or exceed—its 2025 guidance.

A Strong 2024 Base, But Challenges Loom

Acushnet closed 2024 on a solid note, reporting $2.46 billion in net sales, a 4% constant currency increase, driven by Titleist’s 7% sales growth in golf equipment. The Pro V1 golf ball and new club launches were key drivers, while FootJoy’s gear segment delivered double-digit growth. However, the FootJoy apparel division struggled, posting a 2% annual sales decline due to weak international footwear sales—a trend that remains a concern.

The company’s 2025 guidance reflects cautious optimism. It projects $2.485 billion to $2.535 billion in sales, with a $35 million drag from foreign currency fluctuations, and expects adjusted EBITDA of $405 million to $420 million. Management also emphasized operational discipline, noting margin improvements from normalized supply chains and reduced freight costs.

Q1 2025 Outlook: Balancing Seasonality and Risks

Analysts estimate Q1 sales of $697.7 million, a 1.4% decline from the prior-year period, driven by typical winter seasonality in golf demand. However, the EPS estimate of $1.36 (down 8% year-over-year) highlights potential margin pressures, though Acushnet has historically outperformed earnings expectations.

Key Risks and Opportunities

1. Foreign Exchange and Tariffs: The $35 million forex headwind is already factored into guidance, but further currency volatility or retaliatory trade actions could disrupt supply chains.
2. FootJoy’s Turnaround: The footwear segment’s global sell-through issues must be addressed through product innovation or market-specific strategies.
3. Margin Resilience: Gross margins are expected to stabilize or expand, but operational investments in fitting networks and digital commerce may weigh on short-term profitability.

Strategic Leverage Points

• Product Launches: The Pro V1’s front-loaded growth in 2025 and new club launches could boost Q2 momentum.
• Global Expansion: Acushnet’s focus on emerging markets (e.g., Asia-Pacific) and premiumization in equipment sales offers long-term upside.
• Dividend Discipline: The 9% dividend hike underscores financial health, with a payout ratio of ~40% of earnings seen as sustainable.

Conclusion: A Golf Swing With Mixed Lies

Acushnet’s Q1 results will serve as a litmus test for its ability to balance growth and margin management in a volatile environment. While the company’s leadership in Titleist positions it well for equipment demand, FootJoy’s struggles and macroeconomic headwinds pose near-term hurdles.

Investors should prioritize two key metrics: FootJoy’s sales recovery and margin expansion trends. If Acushnet can stabilize its apparel division and achieve the high end of its EBITDA guidance ($420 million), the stock could regain momentum, supported by a 14.7x forward P/E ratio—modest compared to its 5-year average of 16.8x.

The path to success hinges on execution in 2025: leveraging product cycles, mitigating forex risks, and proving that FootJoy’s challenges are temporary. For now, the market’s patience appears limited, with shares down 14% year-to-date—a gap that could narrow if Q1 earnings reflect resilience in the face of adversity.

Final Call: Acushnet’s story remains tied to its dual brand engine. Investors should weigh near-term risks against its long-term market dominance—the swing is still in progress.