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Acushnet Holdings Corp. (GOLF)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 net sales rose 7.8% year over year to $445.2M; Adjusted EBITDA improved to $12.4M from a $(1.5)M loss in Q4 2023, while diluted EPS was $(0.02) versus $(0.41) in the prior year .
  • Reported gross margin was 46.7%, up ~300 bps year over year; management noted ~150 bps of the improvement was a one-time PTO policy change benefit excluded from Adjusted EBITDA .
  • Management raised the quarterly dividend 9.3% to $0.235 per share and authorized an additional $250M for share repurchases (total authorization now $1.25B); 442,867 shares were repurchased in Q4 for $30.0M .
  • 2025 outlook introduced: net sales of $2.485–$2.535B (including ~$35M FX headwind) and Adjusted EBITDA of $405–$420M; outlook excludes potential new tariffs (10% China tariff would be a ~$7M headwind) .
  • Potential stock catalysts: continued momentum in Titleist GT metals and new Pro V1/Pro V1x launch, dividend increase, larger buyback, and a clear 2025 framework with margin resilience commentary .

What Went Well and What Went Wrong

  • What Went Well

    • Titleist golf equipment grew 7.3% in Q4, driven by GT drivers/fairways and higher ASPs; Golf gear rose 17.3% on travel products and gloves .
    • Gross margin expanded to 46.7%; management cited normalized supply chain, moderating freight/distribution costs, and strength in equipment as drivers (ex-PTO benefit) .
    • CEO emphasized strong product cadence and brand momentum: “Titleist golf equipment posted healthy gains, driven by the successful introduction of GT metals and SM10 wedges and continued golf ball success led by Pro V1, Pro V1x and AVX” .

  • What Went Wrong

    • Japan declined across all reportable segments; outside the U.S. net sales rose but were offset by Japan weakness in Q4 .
    • SG&A increased for the year, reflecting investments (global fitting, IT, A&P) and restructuring costs related to footwear manufacturing transition to Vietnam; interest expense also increased .
    • FootJoy remains in a multi-quarter normalization after industry-wide softness; while Q4 FootJoy was up 2.0%, management continues SKU rationalization and premium focus amid prior international inventory corrections .

Financial Results

MetricQ4 2023Q2 2024Q3 2024Q4 2024
Revenue ($USD Millions)$413.0 $683.9 $620.5 $445.2
Diluted EPS ($USD)($0.41) $1.11 $0.89 ($0.02)
Adjusted EBITDA ($USD Millions)$(1.5) $131.0 $107.4 $12.4
Adjusted EBITDA Margin %(0.4)% 19.2% 17.3% 2.8%

Gross Margin Trend (Reported)

MetricQ2 2024Q3 2024Q4 2024
Gross Margin %54.4% 54.4% 46.7%

Q4 Segment Net Sales ($USD Millions)

SegmentQ4 2023Q4 2024YoY Change
Golf balls$139.6 $140.5 +0.6%
Golf clubs$108.8 $126.0 +15.8%
Titleist golf equipment (total)$248.4 $266.5 +7.3%
FootJoy golf wear$95.5 $97.4 +2.0%
Golf gear$32.3 $37.9 +17.3%

Q4 Regional Net Sales ($USD Millions)

RegionQ4 2023Q4 2024YoY Change
United States$226.2 $245.8 +8.7%
EMEA$48.2 $57.0 +18.3%
Japan$31.2 $25.3 (18.9)%
Korea$60.5 $64.8 +7.1%
Rest of World$46.9 $52.3 +11.5%

Q4 Operating Metrics ($USD Millions)

MetricQ4 2023Q4 2024
SG&A$183.9 $193.1
R&D$17.6 $16.3
Interest Expense (net)$11.1 $12.3
Gross Profit$180.3 $207.7

Other KPIs and Actions

  • Quarterly dividend increased to $0.235 per share, payable Mar 21, 2025; shares outstanding were 59,928,969 as of Feb 21, 2025 .
  • Q4 repurchases: 442,867 shares at $67.69 average ($30.0M); authorization increased by $250M to total $1.25B .
  • Net leverage ratio at year-end 2024 was 1.8x; inventories down ~$40M (~6%) vs year-end 2023; 2024 CapEx was ~$75M .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Net Sales (reported)FY 2025N/A$2.485–$2.535B; includes ~$35M FX headwindIntroduced
Adjusted EBITDAFY 2025N/A$405–$420MIntroduced
Adjusted EBITDA MarginFY 2025N/A~16.4% at midpointIntroduced
SG&A growth vs salesFY 2025N/ASG&A growth expected higher than sales growthNew qualitative guide
CapExFY 2025N/A~$85MNew
ERP capitalized costsFY 2025N/A$15–$20MNew
First-half net salesH1 2025N/AUp low single digits YoYNew
Q1 FX headwindQ1 2025N/A~$10–$15M headwindNew
Tariffs (China 10%)FY 2025N/AExcluded; would be ~$7M headwindNew disclosure
Dividend per shareQ1 2025 dividend$0.215 (Q4 2024) $0.235Raised
Share repurchase authorizationAs of Feb 13, 2025N/A+$250M to total $1.25BIncreased

Earnings Call Themes & Trends

TopicQ2 2024 (Q-2)Q3 2024 (Q-1)Q4 2024 (Current)Trend
Product performance (Titleist GT metals, Pro V1)Teased GT launch; strong tour validation; ball momentum despite competitive launches GT drivers/fairways drove +18% clubs; ball inventories lowered ahead of 2025 launch Equipment strength continues; new Pro V1/Pro V1x launch underway with 77% tour usage Building momentum into 2025
FootJoy footwear/apparelU.S. normalized; ex-U.S. inventories lagging; premium apparel in Korea correcting FootJoy down; holidays promotional caution; inventories improving FootJoy +2.0% in Q4; SKU rationalization; premium focus (Premier, HyperFlex, Quantum) Normalizing; profitability focus
Supply chain & ERPBall plant capacity/throughput investments; supply chain readiness for GT Distribution efficiencies; back-half margin stability Footwear moved from China to Vietnam; multi-year global cloud ERP implementation Structural efficiency investments
Gross margin driversMix and manufacturing efficiencies; limited promotions Clubs mix drove margin; steady promotional environment 46.7% margin; normalized freight/distribution; PTO benefit 150 bps Improving, albeit lower in Q4 seasonally
Regional trendsU.S. strong; EMEA weather headwinds; Asia apparel soft U.S. +6%; Japan/Korea/ROW up; EMEA down; balls lower as pipeline reset U.S./EMEA/Korea/ROW up; Japan down; cautious on Korea premium apparel U.S. robust; Japan soft; Korea mixed
Tariffs/macroFX headwinds; cautious on Asia apparel Cautious quarterly cadence; FX effects 2025 guide excludes tariffs; 10% China tariff ≈ $7M headwind; limited Canada/Mexico exposure Risk disclosed; mitigation actions underway

Management Commentary

  • “Acushnet experienced another positive year in 2024, delivering 4% full year constant currency sales growth and adjusted EBITDA growth of 7.5%... Titleist golf equipment posted healthy gains, driven by the successful introduction of GT metals and SM10 wedges and continued golf ball success led by Pro V1, Pro V1x and AVX models” .
  • “Looking to 2025, we are excited about the launch of new Titleist Pro V1 and Pro V1x golf balls... The golf industry is healthy, with record rounds of play in the U.S. in 2024” .
  • CFO: “Reported gross margin of 46.7% was up 300 basis points. The impact from the onetime PTO benefit was 150 basis points on gross margin for the quarter” .
  • Strategic investments: global fitting network expansion, B2B/D2C reach, and a new cloud-based global ERP to drive scalability and supply chain/finance capabilities .
  • Footwear supply chain: completed transition from China to Vietnam to enhance product development and supply durability .

Q&A Highlights

  • Gross margin drivers: Normalized supply chain and moderating freight/distribution contributed to Q4 margin expansion, beyond the one-time PTO benefit .
  • 2025 investments: SG&A growth to outpace sales given outsized 2025 initiatives (ERP, global fitting); margins expected consistent to expanding vs 2024 .
  • Segment growth cadence: Pro V1 launch drives first-half ball growth; club growth more weighted to Q2 (GT1 drivers/fairways, GT hybrids, Cameron putters) .
  • Tariffs: 2025 outlook excludes potential U.S. tariff impacts; 10% China tariff ≈ $7M headwind; company pursuing supply chain and pricing mitigation .
  • Korea: Equipment outlook solid; premium apparel market correcting; macro/political pressures monitored .

Estimates Context

  • Wall Street consensus (S&P Global) for Q4 2024 EPS and revenue was unavailable due to retrieval limits at time of request. Values unavailable — estimates would normally be sourced from S&P Global (Capital IQ).
  • Implication: With top-line growth and margin improvement, sell-side updates may focus on the durability of equipment strength and FootJoy profitability normalization; however, specific beat/miss vs consensus cannot be assessed here without SPGI data.

Key Takeaways for Investors

  • Equipment strength continues: Titleist GT metals and Pro V1/Pro V1x underpin 2025 growth; Q4 equipment +7.3% and gear +17.3% indicate resilient demand and pricing power .
  • Margin quality: Q4 gross margin expansion reflects structural improvements (normalized freight/distribution) beyond one-time PTO; management guides for consistent/expanding gross margins in 2025 .
  • Capital returns: Dividend raised to $0.235 and buyback authorization lifted to $1.25B; Q4 repurchases totaled $30M, reinforcing confidence in cash generation .
  • 2025 framework: Net sales $2.485–$2.535B and Adjusted EBITDA $405–$420M despite ~$35M FX headwind; SG&A investment higher near-term for long-term operating leverage (ERP, fitting, digital) .
  • Risk watch: Japan softness and Korea premium apparel correction continue; tariff uncertainty remains excluded from guidance (10% China tariff ≈ $7M headwind) .
  • Tactical: Near-term revenues weighted to Q2 with club launches; Q1 faces FX headwind; FootJoy strategy prioritizes margin via premium mix and SKU rationalization .
  • Structural narrative: Industry participation and rounds remain healthy; dedicated golfer focus and fitting-led model should sustain share and pricing discipline into 2025 .