Hello and welcome to the Acushnet Company fourth quarter 2025 earnings call. Throughout this discussion, we will make reference to non-GAAP financial measures, including items such as net sales on a constant currency basis and adjusted EBITDA. Cameron has been with our team for a while, and it's my pleasure to welcome him to his first quarterly earnings call. We appreciate your interest in Acushnet and look forward to sharing our 2025 results and future outlook today.
For the full year, Acushnet achieved net sales of $2.56 billion and adjusted EBITDA of $410 million in 2025, growth of 4% and 1.5%, respectively. As you will note from our revenue growth, the company is benefiting from recent capacity expansion projects, which will continue with a focus on cast urethane golf ball production and custom golf club assembly. In 2025, new Pro V1 posted gains across all regions, contributing to a 4% increase in golf ball net sales on the year with EMEA, Japan, and the U.S., our fastest growing markets. We are pleased with increasing demand for our AIM, or Alignment Integrated Marking golf balls.
Within equipment, 2025 was a strong year for Titleist Golf Clubs, which grew more than 7%, led by the successful launch of new T-Series irons and steady growth in metals and Scotty Cameron putters. Growth in gloves and apparel added to FootJoy's momentum and improved profitability for the year. Rounding out our portfolio, we continue to generate strong growth with our KJUS brand, up 9% on the year, led by double-digit gains in the U.S. Titleist Apparel also delivered a promising year, led by growth in China and our business in Korea.
| Metric | Period | Current guidance |
|---|---|---|
| Net sales (reported) | FY2026 | $2.625B to $2.675B |
| Net sales (constant currency) | FY2026 | up 2.5% to 4.5% vs 2025, with growth across all segments and both domestically and internationally (strength in EMEA and rest of world) |
| Adjusted EBITDA | FY2026 | $415M to $435M; midpoint adjusted EBITDA margin ~16%, flat with 2025 |
| Gross margin | FY2026 | relatively flat to 2025, slightly higher in first half and less so in the back half |
| Tariff costs | FY2026 | ~$70M assumed (reflecting environment prior to Feb 20 Supreme Court ruling; ~$40M incremental, all IEEPA) |
| SG&A | FY2026 | growth excluding ~$6M incremental ERP expense generally in line with sales growth |
| Capital expenditures | FY2026 | ~$95M (a high watermark, stepping down in subsequent years) plus ~$25M capitalized ERP costs |
| Free cash flow | FY2026 | expected to improve meaningfully and normalize toward recent run rates as 2025 one-time outflows abate |
| Net leverage | FY2026 | policy to maintain at or below 2.25x on average |
| Quarterly dividend | FY2026 | raised 8.5% to $0.255 per share (ninth consecutive annual increase) |
| First half 2026 net sales | 1H2026 | up mid to high single digits, weighted to Q2 (SM11 Vokey wedges + metals launch accelerated to June); Q1 net sales up low single digits |
| First half 2026 adjusted EBITDA | 1H2026 | up mid to high single digits, heavily weighted to Q2 |
| Metric | YoY | Note |
|---|---|---|
| Q4 2025 net sales (consolidated) | up 7% (constant currency) | primarily higher Titleist Golf Equipment sales |
| Q4 2025 Titleist Golf Equipment net sales | up 10% | higher T-Series iron and SM10 wedge volumes, partially offset by lower GT driver sales comping against last year's launch |
| Q4 2025 FootJoy net sales | up 4.5% | favorable mix shift and higher average selling prices in footwear |
| Q4 2025 golf gear net sales | down 5% | not specified |
| Q4 2025 adjusted EBITDA | down to $9.8M from $12.4M | $15M of tariff costs in the quarter (largest quarter of the year) |
| Q4 2025 gross profit | up $3M to $211M | prior-year Q4 included a ~$7M one-time PTO policy change benefit |
| FY2025 net sales (consolidated) | up 4% to $2.56B | led by Titleist Golf Equipment segment growth |
| FY2025 adjusted EBITDA | up 1.5% to $410M | strong operating segment performance offset by tariff and cost pressure |
| FY2025 Titleist Golf Equipment segment | up 6% | golf balls up 4% (new Pro V1 gains across all regions) and golf clubs up more than 7% (T-Series irons, metals, Scotty Cameron, SM10 Vokey) |
| FY2025 Titleist golf balls | up 4% | new Pro V1 posted gains across all regions; EMEA, Japan and U.S. fastest growing |
| FY2025 Titleist golf clubs | up more than 7% | successful T-Series iron launch, steady metals and Scotty Cameron putter growth, strong year-two SM10 Vokey wedges |
| FY2025 gear business | up 6% | strong Titleist Gear gains in EMEA and U.S. plus Club Glove travel product momentum |
| FY2025 FootJoy net sales | down 1% | reduced discounted/closeout sales versus last year, offset by premium mix shift |
| FY2025 KJUS | up 9% | double-digit gains in the U.S. |
| FY2025 gross profit | up 3% (+$34M) to $1.2B | higher sales volumes, higher average selling prices, favorable mix |
| FY2025 gross margin | down 60 bps to 47.7% | ~$30M of incremental tariff costs |
| FY2025 SG&A | up $32M / 4% to $833M | higher employee expense (fitting initiatives), higher A&P for product launches, higher IT expense; prior year had ~$9M one-time PTO benefit |
| FY2025 regional equipment performance | gains in all major regions, led by U.S. and EMEA; softer Japan and Korea | equipment gains in Japan/Korea offset by declines in apparel and footwear categories |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Two-year product cadence and 2026 launches (no Pro V1 launch year) | 2025 was a new Pro V1 launch year driving ball growth | 2026 is an even-year launch of full Titleist golf ball lineup (Pro V1x Left Dash, AVX, Tour Soft, Velocity), plus SM11 Vokey wedges and Scotty Cameron Mallet putters in Q1, with a new driver launch accelerated to late June from the customary Q3/early-August timing | — |
| Capacity expansion and manufacturing investment | recent capacity expansion projects benefiting revenue growth | continued focus on cast urethane golf ball production and custom golf club assembly; 2026 capex ~$95M (a high watermark) directed at golf ball capacity and worldwide club production | — |
| Fitting networks and services (club, ball, footwear, TPI) | long-standing club and ball fitting advantage | expanding global fitting networks across Titleist equipment and FootJoy (FJ Mobile Fit Lab), plus investing in Titleist Performance Institute where demand outpaces capacity | — |
| Tariffs and pricing | ~$30M tariff cost in 2025; early pricing moves in gear/wearables in 2H25 | ~$70M tariffs assumed in 2026 (~$40M incremental IEEPA); equipment price increases in 1H26 tied to new club products and a U.S./Canada Pro V1 ball pricing story; monitoring Feb 20 Supreme Court ruling and potential refund | — |
| Capital return and balance sheet | $1.1B+ returned over four years; eight prior dividend increases | 8.5% dividend increase to $0.255 (ninth straight year), ~$241M repurchase authorization remaining as of Feb 21 2026, net leverage 2.2x, refinanced senior notes to 2033 and extended revolver to 2030 | — |
| FootJoy repositioning and international wearables | footwear inventory correction post-pandemic; focus on bottom line over top line | premium performance focus (Premiere, Pro/SL, HyperFlex) raising the price floor and improving profitability; equipment growth expected in Japan and Korea with tempered wearables/footwear outlook amid tariff burden | — |