Brunswick 2025 Q2 Earnings Misses Targets as Net Income Drops 40.7%

Brunswick (BC) reported its fiscal 2025 Q2 earnings on Jul 30th, 2025. The total revenue of Brunswick increased slightly by 0.2% to $1.45 billion, compared to $1.44 billion in the same quarter of the previous year. However, the company faced challenges in earnings, with a decline in EPS and net income. Brunswick's EPS dropped 39.9% to $0.89, falling short of expectations, and net income decreased by 40.7% to $59.3 million. The company has adjusted its guidance, projecting full-year sales of $5.2 billion and adjusted EPS of $3.25.

Revenue

Brunswick's revenue for Q2 2025 was $1.45 billion, marking a modest increase from the previous year's $1.44 billion in the same period. The propulsion segment recorded $598.20 million, while engine parts and accessories contributed $337.80 million. The Navico Group's revenue was $180.70 million, and the total marine segment accounted for $405.40 million. The boat segment also matched this figure. Corporate/Other segments reported no revenue, and segment eliminations were recorded as $-96.90 million.

Earnings/Net Income

Brunswick's EPS declined 39.9% to $0.89 in 2025 Q2 from $1.48 in 2024 Q2. Meanwhile, the company's net income declined to $59.30 million in 2025 Q2, down 40.7% from $100 million reported in 2024 Q2. The significant drop in earnings reflects a challenging quarter for Brunswick.

Price Action

The stock price of Brunswick dropped 3.55% during the latest trading day, decreased 8.55% over the past full trading week, but increased by 6.42% month-to-date.

Post-Earnings Price Action Review

The investment strategy of purchasing Brunswick stock when earnings exceed expectations and selling after 30 days yielded a 15.03% return. This was significantly lower than the benchmark return of 86.38%. Despite having a maximum drawdown of 0.00% and a Sharpe ratio of 0.14, the strategy's CAGR stood at 3.01%, indicating modest growth. With a volatility of 21.03% and no maximum drawdown, it demonstrated a relatively low-risk profile. Nevertheless, its absolute performance was poor compared to the broader market, highlighting the strategy's underperformance.

CEO Commentary

David Foulkes, Chief Executive Officer, emphasized that Brunswick Corporation delivered strong second-quarter results despite challenging macro conditions and weather issues, achieving sales of $1.4 billion and EPS of $1.16. He noted that the propulsion business experienced robust growth, driven by strong OEM orders and continued market share gains. Foulkes highlighted the company's commitment to ongoing operational efficiencies, cost control, and rationalization efforts to enhance profitability. He expressed cautious optimism regarding the second half of the year, supported by improving retail trends in July and strategic inventory management.

Guidance

Brunswick Corporation projects full-year sales of approximately $5.2 billion and adjusted EPS of around $3.25 for 2025. The free cash flow guidance has been raised to over $400 million for the full year, with an increased debt reduction target of $175 million. The company anticipates continued challenges from tariffs but maintains confidence in achieving its financial targets due to operational strengths and positive market momentum.

Additional News

Recently, Brunswick declared a quarterly dividend of $0.43 per share, payable on September 15, 2025, to shareholders of record as of August 20, 2025. This reaffirms the company's commitment to shareholder returns. Additionally, Brunswick completed another tranche of share repurchases, totaling over 22.4 million shares bought back for more than $1.55 billion under its 2019 plan. These actions underscore Brunswick's active capital return strategy amid challenging market conditions, with a focus on maintaining shareholder confidence despite ongoing cost pressures and demand fluctuations.