Golf equipment sales for 2024 at Topgolf Callaway Brands (MODG: NYSE) decreased slightly to $1.38 billion – a drop of $5.5 million or 0.4% decrease compared to 2023. The company said the decline was due to “negative foreign currency exchange rates as revenue increased slightly on a constant currency basis.’’
Earnings from golf equipment sales, meanwhile, decreased by $9.7 million versus 2023 to $184 million. The company cited higher freight rates and “unfavorable changes’’ in foreign exchange rates as reasons for the decline.
“We remain confident in the health of our Golf Equipment category, our brand position in it, and our 2025 product lineup,’’ said company President/CEO Chip Brewer. “We expect the TravisMathew (apparel) brand to deliver year-over-year growth on both the top and bottom line and Jack Wolfskin (apparel) to return to profitability.
“At the same time, we are facing year-over-year headwinds from foreign exchange, budgeting back to target incentive compensation levels, which were not paid in 2024, and, to a lesser extent, tariffs. These will negatively impact our core business EBITDA by approximately $75 million year over year, with foreign exchange and loan impacting us by approximately $60 million on the top line and $40 million on the bottom. This will unfortunately impact our financial results this year.’’
Those last two numbers likely are one reason the company’s stock on Feb. 25 fell to a 52-week low of $6.11.
But Brewer did have some positive spin for Wall Street analysts on his Geb. 24 conference call.
“Looking further forward, post separation with Topgolf (expected later this year), we see the opportunity for further cost savings as we anticipate scaling our corporate overhead back to a level more consistent with the size of the business without TopGolf,’’ he said. “We anticipate being able to grow our Golf Equipment revenues slightly faster than the golf market overall – consistent with our long-term track record. We remain very optimistic about the future of this business.’’
Callaway Topgolf Brands after market close on Feb. 24 reported a Q4 2024 loss of $1.45 billion, on revenue of $924.4 million – an increase of three percent – primarily driven by increases in golf equipment.
The Q4 loss created a 2024 full year loss of $1.26 billion on revenue of $4.24 billion – a one percent decrease year-over-year, primarily due to decreases in the Korea business and the Jack Wolfskin Europe business as a result of soft market conditions in those markets.