Callaway Golf Company (CALY) Q1 2025 earnings summary

Executive summary

• Q1 2025 consolidated net revenue was $1,092.3 million, down 4.5%–5% year-over-year but ahead of expectations, with Adjusted EBITDA and segment operating income outperforming guidance.

• Announced intent to separate into two independent companies: Callaway (golf equipment and active lifestyle) and Topgolf (venue-based golf entertainment), targeting completion in the second half of 2025.

• Entered agreement to sell Jack Wolfskin business for $290 million in cash, expected to close late Q2 or early Q3 2025, aiming to enhance business focus and liquidity.

• Golf Equipment segment saw strong performance, benefiting from cost reduction, margin improvement initiatives, and the Elyte Driver launch.

• Available liquidity increased 12% year-over-year to $805 million.

Financial highlights

• Q1 2025 net revenue: $1,092.3 million (down 4.5%–5% year-over-year); Adjusted EBITDA: $167.3 million (up 4%).

• GAAP net income: $2.1 million; non-GAAP net income: $20.3 million; diluted EPS: $0.01 (GAAP), $0.11 (non-GAAP).

• Q1 total segment operating income up 9.7% to $120.3 million.

• Inventory decreased $49 million year-over-year to $653.9 million, reflecting Jack Wolfskin reclassification.

• Cash and cash equivalents at quarter end: $317.0–$322.7 million.

Outlook and guidance

• Full-year 2025 consolidated net revenue guidance: $4.0–$4.185 billion; Adjusted EBITDA: $415–$505 million.

• Topgolf revenue expected at $1.68–$1.79 billion; same venue sales projected down 6%–12%; Adjusted EBITDA guidance maintained.

• Q2 2025 revenue expected at $1.075–$1.115 billion; Adjusted EBITDA at $139–$159 million.

• Guidance includes $25 million EBITDA impact from incremental tariffs and assumes current FX rates.

• Free cash flow expected to be positive for both the total company and Topgolf in 2025.