NYSE$CALY

Callaway Golf Company · Q1 2022 earnings

Q1 2022 earnings · · Investor relations

Briefing

Callaway Golf Company reported record first quarter 2022 results, driven by strong demand, improved supply, and strength across all segments.

Callaway Golf Company announced record first quarter 2022 results with consolidated net revenues increasing by $388.6 million (+59.6% compared to Q1 2021) to $1,040.2 million. GAAP net income was $86.7 million and non-GAAP net income was $70.9 million. The company increased its full year 2022 revenue outlook to $3,935 million - $3,970 million and Adjusted EBITDA outlook to $535 million - $555 million.

  • Q1 2022 consolidated net revenues increased $388.6 million (+59.6% compared to Q1 2021) to $1,040.2 million
  • Q1 2022 GAAP net income of $86.7 million and non-GAAP net income of $70.9 million
  • Q1 2022 total segment operating income margin improved 140 basis points on a pro forma basis, which includes Topgolf results for the full three-month period
  • Q1 2022 Adjusted EBITDA increased $42.0 million (+32.9% compared to Q1 2021) to $169.8 million

Headline financials

Total Revenue

$1.04B

Previous: $652M+59.6%
EPS (adj)

$0.36

Previous: $0.62-41.9%
Capital Expenditures

-$124M

Previous: -$28.8M-331.3%
Free Cash Flow

-$37.6M

Previous: $244M-115.4%
Net Income

$86.7M

Previous: $272M-68.2%
Operating Income

$94.3M

Previous: $76.1M+23.9%
Gross Profit

$94.3M

Previous: $76.1M+23.9%
Cash & Equivalents

$245M

Previous: $397M-38.3%
Total Assets

$8.08B

Previous: $7.11B+13.7%
Stock-Based Comp

$13.8M

Previous: $4.6M+200.0%

Revenue & EPS history

Topgolf Callaway · Revenue · Quarterly

$1.04B

Q1 2022+59.6%vs Q1 2021
Beat estimate in 9 of 15 quarters(60%)
ActualEstimate

Revenue by segment

Topgolf Callaway · $790M total across 2 segments · Q1 2022

  • Golf Equipment
    $468M+24.2%
  • Topgolf
    $322M+247.6%

Forward guidance

The company provided full year and second quarter 2022 outlook. Second quarter 2022 net revenues estimate assumes all segments continue to outperform 2021. Second quarter 2022 Adjusted EBITDA estimate assumes profit margins continue to largely outrun any input, freight and foreign exchange pressures the Company is experiencing, as volume, price and continuing efficiencies are continuing to offset those pressures.

Tailwinds

  • Full year 2022 net revenues estimate assumes Topgolf segment revenue of approximately $1.56 billion.
  • Golf Equipment segment revenue increasing approximately 10% year-over-year.
  • Apparel, Gear and Other segment revenue reaching approximately $1 billion.
  • Topgolf full year same venue sales are expected to grow at mid-to-high single digits compared to 2019.
  • The Company is increasing its full year 2022 Adjusted EBITDA guidance by $42.5 million at the midpoint of guidance.

Headwinds

  • Ongoing impact of COVID-19.
  • Changes in foreign currency effects, which are estimated to have a negative full year impact on net revenues of $115 million compared to 2021 and $39 million on second quarter net revenues compared to second quarter 2021
  • Freight costs and other inflationary pressures.
  • The Company is currently unable to predict with a reasonable degree of certainty the type and extent of certain items that would be expected to impact net income in the future but would not impact Adjusted EBITDA.
  • Actual results may differ materially from those estimated or anticipated as a result of various risks and unknowns.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q1 2022

Historical avgQ1 2022

-0.1%

Avg return

Earnings day

-1.6%

Avg return

5 days after

+1.5%

Avg return

30 days after

50%

32 / 64 earnings

Positive

+18.7%

Q3 2013

Best reaction

-20.8%

Q3 2023

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-0.1%+6.3%+0.1%
Q3 2025+14.4%+14.3%+24.2%
Q1 2025-17.2%-11.4%+0.0%
Q4 2024-0.3%-2.5%+3.0%
Q3 2024-11.3%-11.6%-17.1%
Q2 2024-14.5%-18.4%-27.1%
Q1 2024-8.2%-8.0%-7.6%
Q4 2023+5.6%+3.6%-6.3%
Q3 2023-20.8%-22.9%-1.6%
Q2 2023-9.8%-10.6%-12.6%
Q1 2023-13.9%-20.9%-11.4%
Q4 2022-4.0%-1.1%-6.6%
Q3 2022+5.5%+6.2%+23.6%
Q2 2022-2.0%-5.9%-5.8%
Q1 2022+8.1%+18.2%+22.2%
Q4 2021-9.6%-1.7%-10.9%
Q3 2021+2.0%+0.7%-2.9%
Q2 2021-4.2%-11.4%-16.7%
Q1 2021+8.9%+8.6%+14.9%
Q4 2020-2.3%-4.7%-1.6%
Q3 2020+5.5%-2.3%+34.6%
Q2 2020-6.9%-5.7%+2.9%
Q1 2020+2.8%-9.2%+28.4%
Q4 2019-6.7%-3.7%-38.3%
Q3 2019-1.5%-3.5%+1.2%
Q2 2019+10.6%+8.3%+5.3%
Q1 2019-5.2%-5.2%-6.9%
Q4 2018-4.2%-6.6%+3.6%
Q3 2018-2.5%-4.4%-12.3%
Q2 2018+13.1%+13.3%+18.7%
Q1 2018+7.5%+3.2%+13.8%
Q4 2017+3.6%+4.4%+8.8%
Q3 2017+3.4%+1.0%+0.1%
Q2 2017+7.1%+3.5%+9.2%
Q1 2017+7.7%+6.6%+7.8%
Q4 2016-8.4%-7.7%-7.5%
Q3 2016+11.5%+16.0%+18.1%
Q2 2016+0.1%+2.5%+9.3%
Q1 2016-0.6%
Q4 2015+4.6%
Q3 2015+7.5%
Q2 2015+8.0%
Q1 2015+0.6%
Q4 2014+4.9%
Q3 2014+12.1%
Q2 2014-8.5%
Q1 2014-7.7%
Q4 2013-6.4%
Q3 2013+18.7%
Q2 2013+6.1%
Q1 2013+3.7%
Q4 2012+0.2%
Q3 2012-7.6%
Q2 2012+3.7%
Q1 2011-12.2%
Q1 2012+5.5%
Q4 2009-0.3%
Q4 2011-0.3%
Q3 2011+2.0%
Q3 2010+2.0%
Q4 2010-1.4%
Q2 2011-1.4%
Q2 2010-1.4%
Q1 2010+0.6%

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