Acushnet Holdings Corp. (GOLF) Q4 2025 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call reflects a positive outlook with strong demand in key markets, especially the U.S., and strategic pricing. Despite tariff impacts, the company anticipates growth in club volumes and equipment sales in Japan. The focus on premium products and consumer willingness to pay higher prices further supports a positive sentiment. However, flat gross margins and tariff challenges slightly temper the outlook. Given the company's market cap and the overall sentiment, a 2% to 8% stock price increase is expected over the next two weeks.
Key Financial Performance
Net Sales (Full Year 2025) $2.56 billion, a growth of 4% year-over-year. This growth was driven by investments in product development, precision manufacturing, and fitting, particularly in the Titleist Golf Equipment segment.
Adjusted EBITDA (Full Year 2025) $410 million, a growth of 1.5% year-over-year. The increase was attributed to higher sales volumes and operational efficiencies.
Titleist Golf Equipment Segment (Full Year 2025) 6% growth year-over-year. This was due to investments in product development, precision manufacturing, and fitting, as well as the success of new product launches like T-Series irons and SM10 wedges.
Golf Ball Net Sales (Full Year 2025) 4% increase year-over-year. Growth was driven by the success of the New Pro V1 and increasing demand for alignment integrated marking golf balls, with EMEA, Japan, and the U.S. being the fastest-growing markets.
Titleist Golf Clubs (Full Year 2025) 7% growth year-over-year. This was led by the launch of new T-Series irons, steady growth in metals and Scotty Cameron putters, and strong results from the Vokey wedge franchise.
Acushnet Gear Business (Full Year 2025) 6% growth year-over-year. Growth was driven by strong increases in Titleist Gear in EMEA and the U.S., as well as growing momentum for Club Glove travel products.
FootJoy Sales (Full Year 2025) 1% decline year-over-year. The decline was mainly due to reduced discounted sales compared to the previous year, although there was a favorable mix shift towards premium high-performance footwear franchises.
Shoes Brand (Full Year 2025) 9% growth year-over-year. This was led by double-digit gains in the U.S.
Titleist Apparel (Full Year 2025) Growth led by increases in China and Korea.
Gross Profit (Full Year 2025) $1.2 billion, a 3% increase year-over-year. The increase was due to higher sales volumes, higher average selling prices, and favorable mix, although gross margin fell by 60 basis points due to incremental tariff costs of approximately $30 million.
SG&A Expense (Full Year 2025) $833 million, a 4% increase year-over-year. The increase was primarily due to higher employee expenses, A&P expenses related to product launches, and higher IT-related expenses.
Free Cash Flow (Full Year 2025) $120 million, down from $170 million in 2024. The decline was due to increased inventory levels, additional spend related to the ERP system implementation, and a voluntary retirement program.
Capital Expenditures (Full Year 2025) $74 million, in line with 2024.
Dividend and Share Repurchases (Full Year 2025) $268 million returned to shareholders, consisting of $56 million in cash dividends and $212 million in share repurchases.
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Operating Highlights
Titleist Golf Equipment: Achieved 6% growth in 2025 due to investments in product development, precision manufacturing, and fitting. New Pro V1 golf balls contributed to a 4% increase in net sales, with strong demand in EMEA, Japan, and the U.S. Successful launches of T-Series irons and SM10 wedges drove growth.
FootJoy: Sales decreased by 1% in 2025 due to reduced discounted sales. However, there was a favorable mix shift towards premium high-performance footwear franchises like Premiere and HyperFlex.
Titleist Gear: Increased 6% in 2025, with strong performance in EMEA and the U.S. Club Glove travel products also gained momentum.
Titleist Apparel: Delivered growth led by China and Korea.
Regional Performance: Strong gains in the U.S. and EMEA markets, with softer conditions in Japan and Korea. Golf ball and golf club sales were strong, but apparel and footwear categories faced challenges in Japan and Korea.
Global Golf Industry: Worldwide rounds of golf increased by 2% in 2025, with growth in EMEA, the U.S., and Japan. The number of golfers in the U.S. also increased.
Operational Efficiencies: Expansion of automated custom imprinting capabilities improved efficiency and reduced lead times. Investments in golf equipment R&D and capacity expansion supported growth.
ERP System Implementation: Ongoing implementation of a global cloud-based ERP system to enhance customer service, supply chain, and finance capabilities.
Dividend Increase: Board approved an 8.5% increase in quarterly dividend payout for 2026, marking the ninth consecutive annual increase.
Capacity Expansion: Strategic investments in golf ball manufacturing and club production facilities to meet demand.
New Product Launches: Plans for new driver launch in June 2026, earlier than usual. New Vokey SM11 wedges and Scotty Cameron mallet putters launched in Q1 2026.
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Risk or Challenges
Tariff Costs: Incremental tariff costs of approximately $30 million in 2025 negatively impacted gross margins. The company expects approximately $70 million of tariff costs in 2026, which could further strain profitability.
Economic Uncertainty: Continued economic uncertainty, including the impact of tariffs, poses challenges to the company's financial performance and strategic execution.
Inventory Management: Inventory levels increased by $33 million in 2025 due to higher tariff costs and increased inventory to support product launches, which could lead to potential inefficiencies or excess inventory risks.
ERP System Implementation: The ongoing implementation of a new global cloud-based ERP system is expected to incur approximately $6 million in incremental operating expenses in 2026, which could temporarily impact operating margins.
Regional Market Challenges: Softer market conditions in Japan and Korea, particularly in the apparel and footwear categories, offset gains in other regions, indicating regional market risks.
Debt and Interest Expense: Interest expense increased by $6 million in 2025 due to higher borrowings, and a $17 million charge from debt extinguishment was recognized, which could impact financial flexibility.
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Guidance & Outlook
Revenue Projections: Full year 2026 net sales are projected to be between $2.625 billion and $2.675 billion on a reported basis, with constant currency growth expected between 2.5% and 4.5% compared to 2025.
Adjusted EBITDA: Full year 2026 adjusted EBITDA is expected to be between $415 million and $435 million, with an adjusted EBITDA margin of approximately 16%, flat with 2025.
Tariff Costs: The company expects approximately $70 million of tariff costs in 2026, reflecting the tariff environment in place prior to the Supreme Court's February 20 ruling.
Capital Expenditures: Capital expenditures in 2026 are expected to be approximately $95 million, primarily for investments in golf ball manufacturing capacity and increased club production. This is considered a high watermark, with spending expected to step down in subsequent years.
Free Cash Flow: Free cash flow in 2026 is expected to improve meaningfully versus 2025 and normalize back towards recent run rates, reflecting the absence of several one-time cash outflows incurred in 2025.
First Half 2026 Performance: Reported first half 2026 net sales are expected to be up mid- to high single digits compared to the first half of 2025, with growth primarily from Titleist Golf Equipment. Adjusted EBITDA for the first half is also expected to increase mid- to high single digits year-over-year.
Strategic Investments: The company plans to prioritize strategic capacity expansion, build-out of global fitting networks for golf equipment and footwear, expansion of B2B and D2C capabilities, and enhancement of the Titleist Performance Institute in 2026.
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Shareholder Return Plan
Dividend and Share Repurchases in 2025: Acushnet returned $268 million to shareholders, consisting of $56 million in cash dividends and $212 million in share repurchases.
Historical Shareholder Returns: Over the past 4 years, Acushnet has returned more than $1.1 billion to shareholders.
Dividend Increase for 2026: The Board of Directors approved an 8.5% increase to the quarterly dividend payout in 2026, raising it to $0.255 per share. This marks the ninth consecutive annual dividend increase since 2017.
Share Repurchase Authorization: As of February 21, 2026, the remaining amount on the share repurchase authorization was approximately $241 million.
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Key Q&A
Q:Can you comment on your innovation pipeline for the new driver and new wedge launches in 2026?
A:The 2026 product calendar will follow the typical two-year product cycle, similar to 2024. However, the new driver launch has been accelerated to late June instead of early August. Details about the product are still under wraps as they have not been shared with trade partners yet.
Q:Can you provide more color on your expectations for the U.S. market in 2026, particularly regarding volume versus price?
A:The U.S. market is considered the healthiest globally, driven by a strong consumer base and increased rounds of play (up 25% over the last 5-6 years). Inventory levels are currently appropriate, and the market is expected to see good growth in club volumes in 2026 compared to 2024, despite flat-to-down volumes in the ball business during non-Pro V1 launch years.
Q:Can you provide an update on the FootJoy business and the Japan and Korea markets?
A:FootJoy has focused on premium performance products and rationalized lower price points, leading to slower top-line growth but improved bottom-line performance. In Japan and Korea, equipment sales (balls and clubs) have been strong, but wearables and footwear have been softer. Japan is expected to see growth in equipment in 2026, while Korea is expected to remain flat or improve slightly.
Q:Is the pricing environment still firm across all categories, and how is the consumer responding to higher prices?
A:The pricing environment remains firm, with price increases in equipment expected in the first half of 2026. The company is careful with pricing and focuses on demonstrating value through improved products and experiences. Early indications suggest consumers are willing to pay higher prices for innovation.
Q:What drove the 19% club growth in the quarter, and why didn’t it flow through to the EBITDA line?
A:The 19% club growth was driven by strong demand and execution, particularly for the T-Series irons. However, the impact of tariffs, especially in Q4, affected the EBITDA line.
Q:What are your top priorities for capturing additional market share in the equipment category in 2026?
A:The focus is on delivering high-quality products, providing a world-class fitting experience, and working closely with trade partners to educate and connect with golfers. Early feedback on new product launches is limited due to the seasonality of the golf industry.
Q:What are your expectations for gross margins in 2026, and how do they compare to 2025?
A:Gross margins in 2026 are expected to be relatively flat compared to 2025, despite higher input costs and tariffs. Margins may be slightly higher in the first half of the year compared to the second half.
Q:What is the pricing landscape across the industry, and how does it position you relative to competitors?
A:The industry has seen price increases, particularly in equipment, starting in 2026. The company believes its premium positioning and focus on product quality and golfer experience give it a strong position in the market.
Q:What are the trends in the health of the sport across international markets?
A:Rounds of golf were up in most regions in 2025, with the U.S. showing the strongest consumer base. Japan and Korea were flat but healthy, with growth in equipment offset by softness in wearables and footwear.
Q:Why was there a difference between the first and second half of U.S. rounds of golf in 2025?
A:The difference was primarily due to weather, with poor weather in the Southeast slowing rounds in the first half, followed by normalization in the second half.
Q:What is driving the persistent increase in rounds of golf over the last several years?
A:The increase is driven by growth in women and junior golfers, as well as a strong avid golfer base. Rounds of golf have increased by approximately 23% since 2019, with nearly 1 billion rounds played globally in 2025.
Q:How is consumer behavior in the golf ecosystem, particularly regarding the bifurcated consumer?
A:The dedicated golfer, characterized as middle class plus, remains resilient and willing to invest in premium products that improve their game. The company focuses on premium performance products to cater to this demographic.
Q:Why is G&A growth expected to be in line with revenue in 2026, despite prior expectations of leverage?
A:While some leverage has been achieved, incremental expenses and investments in growth have led to G&A growth being in line with revenue.
Q:What are the plans for addressing tariffs in 2026, and how might they impact advertising and promotional expenses?
A:The company is monitoring the tariff situation and has taken steps to offset costs through pricing, vendor cost sharing, and operational efficiencies. Advertising and promotional expenses are not being reduced and will continue to support long-term growth.
Q:Review of Unclear Management Responses
A:Management avoided providing specific details about the 2026 product calendar, particularly regarding the new driver and wedge launches, as they have not yet shared the product story with trade partners. Additionally, feedback on new product launches was limited due to the seasonality of the golf industry, and no clear timeline was provided for filing for tariff refunds.
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Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
Acushnet ability
Acushnet gear
BB DC
DC capability
ERP system
FJ
PTO policy
Premiere
SM wedge
Scotty
Titleist Institute
Titleist launch
Titleist segment
acceleration metal
capability efficiency
capacity expansion
capital dividend
change benefit
confidence Acushnet
custom
driver
focus
future
golf industry
implementation
investment golf
investment product
launch timing
metal launch
policy change
product development
GOLF Transcript
Acushnet Holdings Corp. (GOLF) Q1 2026 Earnings Call Transcript
Positive5-6
The earnings call summary highlights strong financial performance with increased net sales, adjusted EBITDA, and net income, alongside improved gross margins. These positive financial metrics suggest robust operational health. However, the lack of discussion on strategic initiatives or returns, and the acknowledgment of currency fluctuation risks, provide some caution. Given the company's market cap, the positive financial results are likely to have a moderate positive impact on the stock price, leading to a prediction of a 2% to 8% increase over the next two weeks.
Acushnet Holdings Corp. (GOLF) Q4 2025 Earnings Call Transcript
Positive2-26
The earnings call reflects a positive outlook with strong demand in key markets, especially the U.S., and strategic pricing. Despite tariff impacts, the company anticipates growth in club volumes and equipment sales in Japan. The focus on premium products and consumer willingness to pay higher prices further supports a positive sentiment. However, flat gross margins and tariff challenges slightly temper the outlook. Given the company's market cap and the overall sentiment, a 2% to 8% stock price increase is expected over the next two weeks.
Acushnet Holdings Corp. (GOLF) Q3 2025 Earnings Call Transcript
Unknown11-5
The earnings call presents a mixed picture: strong sales growth in key segments and successful product launches are offset by increased tariff impacts, higher expenses, and a significant rise in the effective tax rate. The Q&A section reveals some uncertainties, such as tariff mitigation and unclear guidance on sales growth specifics. Despite positive shareholder returns and stable inventory levels, the overall sentiment remains neutral due to these mixed signals and potential headwinds, suggesting a stock price movement within the -2% to 2% range.
Acushnet Holdings Corp. (GOLF) Q2 2025 Earnings Call Transcript
Positive8-8
The earnings call reveals positive financial performance with increased net sales and gross profit, alongside improved gross margins. Despite a slight decline in adjusted EBITDA due to strategic investments, the guidance remains optimistic, especially with strong product launches and stabilization in key markets like Japan and Korea. The Q&A section shows management's proactive approach to tariffs and pricing strategies, maintaining customer satisfaction. Shareholder returns are robust, with significant repurchases and dividends, indicating confidence in future growth. Considering the market cap and overall sentiment, a positive stock price movement of 2% to 8% is expected.
GOLF Slides
GOLF Report
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