Photographer: Kent Nishimura/Bloomberg © 2024 Bloomberg Finance LP Deal Overview On August 7, 2024, Topgolf Callaway Brands Corp. (NYSE: MODG, $11.73, Market Capitalization: $2.2 billion), a prominent player in golf equipment and entertainment, announced that it is conducting a formal strategic review of its businesses, wherein the management is exploring a potential spin-off the Topgolf segment (for more information, visit spinoffresearch.com). This review includes the assessment of organic strategies to r ...

Financial Data and Key Metrics Changes - Total revenue for Q2 2024 was $1.158 billion, a 2% decrease year-over-year and 3% below expectations, primarily due to lower same venue sales at Topgolf [6][29] - Q2 adjusted EBITDA was $206 million, approximately flat compared to the previous year, exceeding expectations due to strong operational efficiencies [28][29] - Full year revenue expectations have been lowered by approximately $225 million to a range of $4.2 billion to $4.26 billion, with EBITDA outlook revised to $570 million to $590 million [6][36] Business Line Performance Changes - Topgolf revenue grew 5% to $494 million, driven by new venue openings, with operating income up 28% year-over-year [30] - Golf Equipment revenue decreased 8% year-over-year to $414 million, attributed to timing of product launches and foreign exchange headwinds [31] - Active Lifestyle segment revenue decreased 3% year-over-year, primarily due to softness in Jack Wolfskin [32] Market Data and Key Metrics Changes - Same venue sales at Topgolf declined 8% in Q2, with expectations for full year same venue sales to decline very high single digits to low double digits [9][12] - The U.S. golf market remains healthy, with Callaway holding strong market shares in various categories, while the Korean market is experiencing softness [23][24] Company Strategy and Development Direction - A formal strategic review of the Topgolf business is underway, focusing on maximizing long-term shareholder value and assessing both organic and inorganic strategies [4][5] - The company aims to continue expanding Topgolf venues, targeting an average of 10 new venues per year starting in 2025, despite current sales volatility [45] - Investments are being made to enhance digital capabilities and promotional strategies to drive traffic and improve same venue sales [13][14][62] Management's Comments on Operating Environment and Future Outlook - Management noted that persistent inflation has led to reduced consumer discretionary spending, impacting traffic at Topgolf venues [8] - The company remains confident in its ability to drive same venue sales growth over time, despite current economic challenges [17][42] - Management emphasized the importance of operational efficiencies and cost management in mitigating revenue impacts [36][42] Other Important Information - The company successfully reduced inventory by $193 million year-over-year, indicating effective inventory management [28][35] - Available liquidity increased by $136 million compared to the previous year, reflecting strong cash flow generation [28][32] Q&A Session Summary Question: Does the current same venue sales trajectory affect future unit growth at Topgolf? - Management believes it is essential to continue building venues, expecting to add an average of 10 per year starting in 2025, despite recent sales volatility [45] Question: What is the expected Q3 benefit from the APEX launch? - Management anticipates a slight benefit from launch timing in Q4 compared to Q3, with expectations for Golf Equipment to be up in the second half of the year [48][49] Question: What are the current pricing strategies at Topgolf? - Management acknowledges pricing as a concern for consumers and is focusing on selective promotions to drive traffic while protecting brand value [51][52] Question: Can you elaborate on the Topgolf strategic review? - The review is assessing all alternatives to maximize long-term shareholder value, including potential inorganic options [53][68] Question: How do the Golf Equipment and Topgolf consumers differ? - The Golf Equipment consumer is generally wealthier and less sensitive to economic downturns compared to the Topgolf consumer [56]

Poor comp sales and lowered guidance caused the stock to crumble yet again. Shares of Topgolf Callaway Brands (MODG -6.35%) slipped close to 25% this week, according to data from S&P Global Market Intelligence. The owner of Callaway, Topgolf, and TravisMathew posted weak growth for the second quarter of 2024. Suffering for many years, the stock is now down 20% year to date and 33% over the last 12 months. Here's why Topgolf Callaway stock fell yet again this week. Lower Topgolf traffic, guidance reduction T ...

Topgolf Callaway Brands (MODG) reported $1.16 billion in revenue for the quarter ended June 2024, representing a year-over-year decline of 1.9%. EPS of $0.42 for the same period compares to $0.39 a year ago. The reported revenue compares to the Zacks Consensus Estimate of $1.19 billion, representing a surprise of -2.67%. The company delivered an EPS surprise of +50.00%, with the consensus EPS estimate being $0.28. While investors closely watch year-over-year changes in headline numbers -- revenue and earnin ...

Topgolf Callaway Brands (MODG) came out with quarterly earnings of $0.42 per share, beating the Zacks Consensus Estimate of $0.28 per share. This compares to earnings of $0.39 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 50%. A quarter ago, it was expected that this maker of golf equipment and accessories would post earnings of $0.01 per share when it actually produced earnings of $0.09, delivering a surprise of 800%. Over ...

Announces Formal Strategic Review of Topgolf Including Organic and Inorganic Alternatives HIGHLIGHTS Q2 Net Income of $62 million, Non-GAAP Net Income of $83 million, and Adjusted EBITDA of $206 million were all ahead of expectations. Q2 Consolidated Revenues were down 1.9% year-over-year and full year Revenue and Adjusted EBITDA outlook lowered to a range of $4,200 - $4,260 million and $570 - $590 million, respectively. Maintained #1 U.S. model market share in Driver, Fairway Woods and Irons with Ai Smoke ...

Enter Topgolf's The Sure Thing club, designed in collaboration with Callaway engineers and made for the everyday, "just want to feel the thrill of hitting a golf ball" Player. Not for sale and only available for gameplay at Topgolf, The Sure Thing is equipped with features that basically guarantee your golf swing, is, well, a sure thing: Enormous club face: A larger club face means a better chance of making contact with the ball, resulting in less whiffs and more hits. 20° loft: Real talk – all that means i ...

Schauffele makes history and becomes the Champion Golfer of the Year with an iconic final round 65 at Royal Troon Callaway Staff Pro Xander Schauffele captured his 2nd major win at The Open Championship. Callaway's Ai Smoke Triple Diamond Drivers, Chrome Tour Golf Ball Family and new Opus Wedges have now earned 3 major wins with Xander's victories and Yuka Saso's win at the U.S. Women's Open. His Chrome Tour Golf Ball is the new gold standard in performance; it provides Xander with total performance from te ...

Chamberlin joins Topgolf from PENN Entertainment Inc. DALLAS, July 18, 2024 /PRNewswire/ -- Modern golf entertainment leader Topgolf announced today that Erin Chamberlin has been named its new Chief Operating Officer beginning July 22. Chamberlin joins the company from PENN Entertainment Inc., the largest provider of gaming entertainment in North America, where she served as a Senior Vice President of Regional Operations since 2019. In her new role, Chamberlin will be responsible for Topgolf's globally owne ...

The new Opus Platinum Wedges are a true leap forward, fusing advancements from metal injection molding (MiM), and tungsten for launch control. MiM Construction has opened the door for Callaway to deliver precision in wedge construction like never before, to dial in touch and feel where players need it. Tungsten has also been incorporated into the topline bringing the flight lower for more control and spin into greens. The designs incorporate Spin Gen Face Technology for Tour-level spin along with Tour Certi ...