Brunswick’s first quarter results reflected a resilient portfolio, with performance surpassing Wall Street’s expectations despite a challenging macroeconomic environment and a double-digit year-over-year sales decline. Management attributed the outcome to steady demand in premium boat brands, ongoing cost reduction measures, and a growing contribution from recurring revenue streams, such as engine parts and accessories and Freedom Boat Club. CEO Dave Foulkes noted, “Our recurring revenue businesses and channels contributed nearly 60% of our first-quarter adjusted operating earnings,” highlighting the stability of these segments even as entry-level products faced softness.
Is now the time to buy BC? Find out in our full research report (it’s free).
Brunswick (BC) Q1 CY2025 Highlights:
- Revenue: $1.22 billion vs analyst estimates of $1.13 billion (10.5% year-on-year decline, 8% beat)
- Adjusted EPS: $0.56 vs analyst estimates of $0.22 (significant beat)
- Adjusted EBITDA: $142.2 million vs analyst estimates of $102.6 million (11.6% margin, 38.5% beat)
- The company dropped its revenue guidance for the full year to $5.2 billion at the midpoint from $5.4 billion, a 3.7% decrease
- Management lowered its full-year Adjusted EPS guidance to $3.25 at the midpoint, a 23.5% decrease
- Operating Margin: 4.6%, down from 8.1% in the same quarter last year
- Market Capitalization: $3.65 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions Brunswick’s Q1 Earnings Call
- Mike Swartz (Truist Securities) asked for clarity on guidance range drivers. CFO Ryan Gwillim detailed that the high end assumes tariff moderation or better mitigation, while the low end reflects sustained tariffs and volume declines.
- James Hardiman (Citi) questioned Q2 guidance and second-half assumptions. Gwillim explained that tariff impacts and volume uncertainties are weighted more heavily in Q2, but noted improved operational efficiency could offset some headwinds in the second half.
- Craig Kennison (Baird) inquired about streamlining entry-level boat offerings. CEO Dave Foulkes confirmed model reductions are underway in weaker segments, emphasizing a shift in focus to higher-margin and growth categories rather than brand-level exits.
- Megan Clapp (Morgan Stanley) asked about premium segment resilience amid capital market volatility. Foulkes said premium brands remain in a relatively strong position, with pipeline inventory lean and dealer health steady.
- Yance Hsu (BNP Paribas) sought details on tariff mitigation actions. Foulkes described ongoing efforts in pricing, supply base migration, and product classification, highlighting long-term reduction of China-sourced components as a key strategy.
Catalysts in Upcoming Quarters
In upcoming quarters, the StockStory team will be watching (1) the effectiveness of tariff mitigation strategies and their impact on margins, (2) retail and dealer demand trends—particularly in premium versus entry-level segments, and (3) continued momentum from new product launches in propulsion and aftermarket businesses. Execution on cost controls and recurring revenue growth will also be central to our analysis.
Brunswick currently trades at $55.47, up from $45.23 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free).
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