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- **Revenue Growth**: Q3 revenue up 3% YoY to $934M, driven by 4% Golf Equipment and 4% Topgolf growth.
- **Tariff Impact**: $12M incremental Q3, full-year $40M. CFO warns 2026 impact could exceed $40M.
- **Topgolf Turnaround**: 1-2 Bay same-venue sales +2.4% Q3, 3+ Bay stabilizing. Food/beverage attach rate improving.
- **Guidance Update**: Full-year EBITDA raised to $490-510M, Topgolf EBITDA $295-305M.
- **Strategic Focus**: Golf Equipment innovation (AI, DSPD products), Topgolf value initiatives (Sunday/Monday pricing), and separation preparation.

**【CEO Summary Section】**
- Total Q3 revenue exceeded expectations, growing 3% YoY to $934 million, driven by 4% growth in Golf Equipment and 4% in Topgolf segments.
- Golf Equipment revenue up 4% YoY ($305M), with gains in clubs (+4%) and balls (+6%). Topgolf revenue rose 4% YoY ($472M), driven by 1% same-venue sales growth and 6 new venues.
- Tariffs added $12M incremental cost in Q3, with full-year impact forecast at $40M. CEO emphasizes strategic cost management and innovation to offset tariff pressures.
- Topgolf achieved positive same-venue sales (1-2 Bay) for first time, up 2.4% Q3, with traffic growth mid-teens. 3+ Bay sales remain down but stabilizing.
- Golf Equipment market share gains, with golf ball US share hitting 22.6% on-course. New products like Elite Triple Diamond driver and Chrome Tour ball receive industry accolades.

**【CFO Financial Commentary】**
- Q3 adjusted EBITDA $115M (-$4M YoY), impacted by $12M tariffs. Golf Equipment operating income $23M (-$4M YoY), Active Lifestyle $14M (-$4M YoY), Topgolf EBITDA $84M (flat YoY).
- Full-year guidance raised: Revenue $3.90-3.94B (+$60M midpoint), EBITDA $490-510M (+$40M). Topgolf revenue $1.77-1.79B (+$40M), EBITDA $295-305M (+$20M).
- Q4 outlook: Revenue $763-803M vs. $810M 2024, EBITDA $13-33M vs. $83M. Headwinds include tariffs, calendar change, and 3+ Bay mix.
- Liquidity strong: $1.25B cash (vs. $861M 2024), net debt $2.23B (-$310M YoY). Free cash flow positive for both businesses.

**【Q&A Highlights】**
- **Golf Equipment Pricing Power**: CEO notes consumer price inelasticity, with differentiated products (e.g., AI-driven drivers) enabling potential price hikes to offset tariffs.
- **Topgolf Trends**: 1-2 Bay traffic up high teens Q3, 3+ Bay stabilizing. Food/beverage attach rate improving, with new menu items and Toast POS system boosting spend per visit.
- **2026 Outlook**: CEO cautious on 2026 tariff impact ($40M+), but optimistic on product pipeline (Chrome Tour ball launch) and Topgolf initiatives (Play More subscription, mobile ordering pilots).
- **Separation Progress**: CEO reaffirms commitment to Topgolf separation, with 3 new venues planned for 2026 and search for Topgolf CEO progressing.
- **Tariff Mitigation**: CFO expects $40M+ tariff impact 2025, with cost savings and pricing actions to partially offset. No further headcount reductions planned beyond 300 already announced.


Topgolf Callaway Brands Corp.(MODG)-20251107-2025 Q3 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

MODG

MODG fundamentals

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