Callaway Golf has reported record financial results for its second quarter, led by Topgolf’s continued rebound from the pandemic and strong demand for new equipment from keen golfers who have not been put off by higher retail prices.
The Carlsbad-based company reported revenue of $1.12 billion, up 22 percent from the same quarter last year. Net income reached $105.4 million, or 53 cents per share. Those figures represent a 13 per cent increase over last year’s like-for-like results.
Callaway Chief Executive Chip Brewer said: “Earlier this year there was a lot of concern about a reversion in golf consumption, but clearly, halfway through the year, the data shows there has been no reversion.”
Callaway’s core club and ball business reported $452 million in revenue between April and June, also up 13 percent year-on-year. Its ‘active lifestyle” segment, which includes TravisMathew, OGIO, Jack Wolfskin and Callaway apparel and accessory brands, increased 40 per cent to record sales of $260 million.
Callaway also continued to benefit from Topgolf, its driving range/sports bar business that it acquired in March 2021 in an all-stock deal valued at more than $3 billion. Topgolf revenues increased 24 percent to $404 million in the quarter. Same venue sales — which excludes new locations — rose nearly 8 percent. Two new Topgolf venues opened in the US this year — one in El Segundo and the other in Seattle, with eight more expected to open by the end of 2022.
“Inflation has been an issue for us, as it has for most companies,” said Brewer. “But across all of our business segments, the data thus far shows we can price to largely offset it.”
The strong dollar also has pressured the company’s results by making its products more expensive in Europe, Japan and other overseas markets, which made up more than one-third of the company’s revenue last year. But Brewer noted that Callaway has managed foreign exchange headwinds before. He said the company is positioned to withstand a certain amount of economic turmoil because of its “concentration in healthy, growing business segments where consumers are both well off and passionate.”
Callaway released its results on Thursday after markets closed on the US’s New York Stock Exchange. Its shares ended down 5 cents at $23.24.