Topgolf, a subsidiary of Callaway Brands Corp. (MODG), experienced a significant drop in shares, plummeting over 6% during the extended trading session on Tuesday. This decline came after the retailer reported slightly lower-than-expected quarterly revenue.
In the second quarter, the company achieved earnings of $117.4 million, equivalent to 59 cents per share. In comparison, the year-ago quarter saw earnings of $105.4 million, or 53 cents per share. After adjusting for one-time items, Topgolf earned 39 cents per share. Analysts surveyed by FactSet predicted an adjusted earnings per share of 34 cents.
Although revenue saw a significant increase of 64% to $1.18 billion from $1.12 billion the previous year, it fell just short of the FactSet expectations of $1.19 billion.
Chief Executive Chip Brewer expressed satisfaction with the company’s second-quarter performance, attributing it to the strong performance across all business segments. Brewer specifically noted market-share gains in golf equipment and the continued strength of Topgolf’s venue business.
Despite the lower-than-expected revenue, Topgolf reaffirmed its revenue guidance for 2023, projecting a range between $4.42 billion and $4.47 billion.
Overall, while Topgolf experienced a minor setback with its second-quarter revenue, it remains optimistic about future growth and its ability to maintain a strong presence in the market.