Impact of Tariffs on Product Pricing and Supply Chain
Management highlighted the recent tariff policies impacting the company's costs, estimating an approximately $30 million impact in the second half of 2025.
The company is actively mitigating tariff effects through supply chain optimization, vendor sharing, and cost reduction initiatives, aiming to offset over 50% of tariff impacts.
Tariffs have led to increased costs in gear, footwear, and apparel, prompting selective pricing actions, while golf balls, manufactured mainly in the U.S., have been less affected.
Management emphasized the rapid change in tariff rates and the importance of supply chain flexibility to adapt to evolving trade policies.
Acushnet Holdings reported Q2 2025 worldwide net sales of $720 million, a 5% increase year-over-year, driven by strength in Golf Equipment and Gear segments.
Adjusted EBITDA for Q2 was $143 million, up $12 million from the prior year, reflecting a 9% year-over-year increase.
Capital expenditures for the first half were $25 million, with full-year guidance lowered to approximately $70 million from $85 million.
Effective tax rate improved to 19.9% in Q2 from 23.2% last year, driven by jurisdictional mix changes.
For the first half of 2025, net sales increased 3% to $1.42 billion, while adjusted EBITDA decreased 1% to $282 million, in line with expectations due to investments in innovation and technology.
Gross profit in Q2 was $354 million, up $21 million from 2024, with gross margin improving by 40 basis points to 49.2%.
Interest expense rose to $15 million in Q2, up $1 million due to increased borrowings.
Inventories increased 11% compared to Q2 2024, reflecting inventory build ahead of tariff deadlines and new product launches.
Returned $154 million to shareholders through $125 million in share repurchases and $29 million in dividends.
SG&A expenses increased by $14 million in Q2, including $6.4 million in restructuring costs related to a voluntary bridge to retirement program.
Impact of Tariffs on Business Operations and Pricing Strategy
The company has implemented a multifaceted approach to managing tariffs, including diversifying suppliers, accelerating tariff cost reductions, leveraging scale for savings, driving internal cost efficiencies through automation, and implementing targeted price increases in Q3.
Tariff costs are currently impacting inventory costs immediately, but the effect on cost of goods sold (COGS) will be seen starting in Q4 due to inventory accounting methods.
Price increases to offset tariff costs are scheduled for Q3, with positive effects on net sales beginning then, but gross margins expected to decline in Q4 as tariff costs are recognized in COGS.
The company has a strong liquidity position ($656 million in total liquidity) and is managing debt levels to navigate tariff-related uncertainties.
Reenergizing the U.S. Columbia Brand Amid Tariff Uncertainty
The company is launching a new global marketing platform emphasizing Columbia's roots, humor, and signature air reference to differentiate in a crowded outdoor market.
Significant investment in demand creation through digital and social strategies, including a site redesign with enhanced mobile capabilities.
Product assortment enhancements for fall, including new collections like Amaze Puff Insulated Jacket and redesigned Rock Band, supported by elevated in-store investments.
Focus on brand perception and customer acquisition in the U.S. despite ongoing trade policy uncertainties and high tariffs, with an estimated tariff impact of $35-$40 million in 2025.
Management emphasizes patience and strategic adjustments, including cost mitigation and marketing, to restore U.S. growth over time.
Dafinchi
