Topgolf Callaway Brands experienced a moderation in demand for golf balls during the third quarter, along with a slowdown in same-venue sales at its Topgolf entertainment centers.
The company reported a profit of $29.7 million, or 16 cents a share, which is a decrease from $38.5 million, or 20 cents a share, in the same period last year. However, adjusted earnings were 20 cents a share, surpassing the expected 11 cents a share according to analysts surveyed by FactSet.
Moreover, the company’s revenue declined by 5.3% to reach $1.04 billion, slightly below the expected $1.05 billion.
Sales and Revenue Trends
While sales of golf equipment slipped by 1.1%, revenue from Topgolf and the company’s active-lifestyle segment both witnessed an increase of about 8%. The decline in same-venue sales at Topgolf by 3% was attributed to a surge in corporate events that occurred last year as the world recovered from the pandemic.
In response to the current market conditions, Chief Executive Chip Brewer emphasized the company’s intention to cut costs and reduce capital expenditures. These measures aim to minimize risk and ensure continued strong growth prospects.