Topgolf Callaway Brands (MODG) investor relations material

Industry trends and consumer behavior

• Golf participation has surged post-pandemic, with both on-course and off-course engagement growing, and female participation reaching record highs.

• The sport is now more culturally relevant, attracting a younger, more diverse audience, and is no longer seen as elitist.

• Off-course venues like Topgolf have become significant, supporting overall industry growth and broadening access.

• Barriers such as time and expense are being addressed, making golf more accessible and appealing to new demographics.

• The customer base for golf equipment is now broader, younger, and more diverse, with a notable increase in female golfers.

Innovation and product strategy

• Product innovation remains central, with heavy investment in R&D and early adoption of AI in product design.

• The brand leads in premium golf equipment and is recognized for being approachable, especially for new and female golfers.

• Sustained leadership in U.S. golf equipment sales and significant investment in golf ball manufacturing.

• Innovation cadence is strong, with new technologies and product launches driving differentiation.

Pricing, tariffs, and cost management

• Golf equipment demand is more sensitive to innovation than price, with little impact from moderate price increases.

• Tariff costs increased from $25M to $40M due to higher rates, but mitigation efforts include supply chain efficiency, margin programs, and pricing strategies.

• Comprehensive cost reviews and vendor negotiations are underway to offset tariff impacts.