Callaway Golf Posts Strong Financial Results For Q1, But Momentum Not Likely To Last
Callaway Golf saw "market share gains across nearly all of its club and ball product lines," which propelled the company to "strong financial results for the first quarter, but concerns that the momentum won’t last sparked a sell-off" of its shares on Thursday, according to Mike Freeman of the SAN DIEGO UNION-TRIBUNE. Sales came in at $352M, up 22% "over the same quarter last year." Analysts predicted sales of $314M. Callaway during Q1 "gained market share with the release of new products, including the latest generation" of Big Bertha drivers. But Big Bertha "wasn’t the only hit." The company "sold more irons, fairway woods, golf balls and accessories such as golf gloves and bags as well." That left competitors "with too much unsold inventory on store shelves" and they are expected to "fight back in the current quarter." Compared with Q1, Callaway thinks that sales "will be flat to down" 5% in Q2 -- typically the "strongest three months in the golf business." It expects to "break-even or be slightly profitable for the quarter" (SAN DIEGO UNION-TRIBUNE, 4/25). At presstime, shares of Callaway Golf were trading at $8.70, down 2.41% from the close of business on Thursday (THE DAILY).