Continuing to struggle with its quarterly same-venue sales, Topgolf Callaway Brands (MODG) has lowered its Topgolf same-venue sales guidance for 2025 from down mid-single digits to down six percent to 12 percent.
As a result, the company is also lowering our full year Topgolf revenue estimates to $1,68 billion to $1,790 billion, which is $45 million lower than previous guidance.
Topgolf’s same-venue sales in Q1 2025 were down approximately 12 percent, with corporate events particularly affected. Topgolf’s Q1 seven percent revenue decline to $394 million versus Q1 of 2024, could suggest to Wall Street a few negative factors, including concerns over potential growth and consumer disposable spending, as well as continued slow down in corporate events.
Also to consider Topgolf Callaway Brands’ high net debt of $2.74 billion, which could impact financial flexibility as the company works to separate Topgolf and Callaway Golf later the year.
Despite the same-venue sales drop in Q1, Topgolf CEO Artie Starrs told Wall Street analysts the division has made “substantial progress in the focus areas, more compelling and accessible value, new and relevant experiences for our players,’’ and a streamlined corporate structure.
“Our number one priority is to drive traffic growth and improve value perception, which we believe is key as we navigate the current environment and for the long term health of the brand,’’ Starrs said. “Overall traffic in the second quarter through April is approximately flat year over year, with one to two bay traffic up low single digits. We can directly attribute this to specific new offers and meaningful improvement in our price value consumer metrics.’’
Artie Starrs (Topgolf Callaway Brands)
While traffic was positive in April, Starrs said same venue sales were down approximately 10 percent, with three-plus play down 17 percent and one-to- two play down eight percent.
“We continue to see players manage their spend, which we are addressing with targeted food and beverage offerings, which cater to group social occasions,’’ Starrs said. “In addition, our events business is pressured, as corporate spending on team outings and entertainment has reduced. It’s clear that our corporate events business is going to be challenged in the near term, and we have modified our operating structure accordingly.’’