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- **Q3 Standout**: $1.4B revenue (+7% YoY), $111M free cash flow, and all segments growing, despite tariffs.
- **2026 Vision**: Flat to up retail growth, driven by lower rates and lean pipelines, with 25%+ EPS growth.
- **Strategic Moves**: $10M+ annual savings from boat plant consolidation, and AutoCaptain launch as first ACES commercial product.
- **Tariff Resilience**: $75M net impact for 2025, with U.S.-based manufacturing mitigating risks.
- **Share Gains**: Mercury at 49.4% U.S. outboard share, Navico gaining 140bps in distribution market share.

**【CEO Summary Section】**
- **Strong Q3 Results**: Revenue of $1.4 billion (+7% YoY), adjusted EPS of $0.97, and free cash flow of $111 million (up 166% YoY). All segments reported growth.
- **Operational Efficiency**: $355 million year-to-date free cash flow, down from $1.6 billion since 2021. Debt reduction guidance increased to $200 million for 2025.
- **Tariff Mitigation**: $75 million net tariff impact for 2025, with strategies like U.S.-based manufacturing and supply chain optimization.
- **Strategic Actions**: Plant consolidation in fiberglass boat manufacturing (Reynosa, Mexico, and Flagler Beach, Florida) to save $10+ million annually post-transition.
- **2026 Outlook**: Flat to up retail growth driven by lower interest rates, lean dealer pipelines, and differentiated products like AutoCaptain.

**【CFO Financial Commentary】**
- **Revenue Breakdown**: Propulsion (+10%), Engine Parts & Accessories (+8%), Navico (+2%), Boat (+4%).
- **Profitability**: Adjusted operating margins stable despite tariffs and variable comp reset. Boat segment margin up 65% YoY due to lower discounts and cost actions.
- **Cash Flow**: Full-year free cash flow guidance raised to >$425 million, driven by recurring revenue and working capital management.
- **Tariff Impact**: $0.70 EPS impact in Q3 from tariffs and variable comp, partially offset by higher sales and absorption.

**【Q&A Key Highlights】**
- **Retail Trends**: Q3 flat YoY, with premium/core outperforming value. 2026 outlook flat to up due to interest rate cuts and lean pipelines.
- **Inventory Management**: Global pipelines down 2,200 units YoY, with U.S. pipelines down 1,200 units. Freshness >80% of inventory.
- **Competitor Tariffs**: Japanese engine imports face 15% tariffs, benefiting Mercury's market share (49.4% U.S. outboard share).
- **Navico Performance**: Sales +2% YoY, with electronics growth and 60% aftermarket contribution. $323M intangible asset impairment due to macro challenges.
- **2026 Guidance**: Mid- to high-single-digit revenue growth, >25% EPS growth, and continued free cash flow generation.

Brunswick Corporation (BC) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

BC

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