Start here if you're new
what it is
It runs Topgolf venues, sells Callaway clubs, and moves golf apparel so you can spend money before, during, and after a round.
how it gets paid
Last year Topgolf Callaway made $2.1B in revenue. Topgolf was the main engine at $0.90B, or 43% of sales.
why it's growing
Revenue grew 460.6% last year. Gross margin was 42.1%, which tells you the products still carry decent markup even while total profitability stays weak.
what just happened
The quarter was about $368M in revenue and a loss that matched consensus, which is another way of saying nobody was surprised.
At a glance
B balance sheet — gets the job done, barely
45/100 earnings predictability — expect surprises
40.8x trailing p/e — you're paying up for this one
5.5% return on capital — nothing to write home about
xvary composite: 47/100 — below average
What they do
It runs Topgolf venues, sells Callaway clubs, and moves golf apparel so you can spend money before, during, and after a round.
This company wins when it keeps you inside one golf wallet. Topgolf was 43% of 2024 sales, Golf Equipment was 33%, and Active Lifestyle was 24%, so your night out, your clubs, and your shirt can all come from the same place. That mix is vertical integration (one company serving you at every step) → plain English: one brand meets you everywhere you golf → so what: leaving gets annoying when the range, the bag, and the gear rack all point to the same logo.
How they make money
$2.1B
annual revenue · their business grew +460.6% last year
Topgolf
$0.90B
Golf Equipment
$0.69B
Active Lifestyle
$0.50B
The products that matter
golf entertainment venues
Topgolf
$903M · 43% of revenue
This is the largest segment at $903M, or 43% of sales. It is the growth story investors talk about most, so it has to do more than just stay big.
43% of revenue
clubs and golf balls
Golf Equipment
$693M · 33% of revenue
At $693M, this is one-third of the business. It gives you scale in golf hardware, but it also means CALY is still tied to equipment demand, not just venue traffic.
33% of revenue
apparel and accessories
Active Lifestyle
$504M · 24% of revenue
This $504M segment is 24% of sales. It adds diversification, but it also exposes you to discretionary spending outside the Topgolf narrative.
24% of revenue
Key numbers
$1.1B
Topgolf sale
The company sold 60% of Topgolf for $1.1B. Plain English: it monetized the crown jewel without fully giving it up. So what: balance-sheet pressure eased.
6.2%
operating margin
Operating margin → profit left after running the business → so what: 6.2% is slim for a company with venue exposure and debt.
$1.2B
long-term debt
Debt is 31% of capital. Plain English: a lot of the business is financed with borrowed money. So what: weak traffic hurts more.
5.5%
return on capital
Return on capital → profit earned on money invested → so what: 5.5% says this business is not squeezing much cash from its assets.
Financial health
B
strength
- balance sheet grade B — adequate — nothing special
- risk rank 4 — safer than 20% of stocks
- price stability 20 / 100
- long-term debt $1.2B (31% of capital)
- net profit margin 5.1% — keeps 5 cents of every dollar in revenue
- return on equity 6% — $0.06 profit for every $1 investors have put in
B — functional but not a standout on the balance sheet.
Total return vs. market
You invested $10,000 in CALY 3 years ago → it's now worth $6,360.
The index would have given you $14,770.
source: institutional data · total return
What just happened
beat estimates
The quarter was about $368M in revenue and a loss that matched consensus, which is another way of saying nobody was surprised.
Revenue fell 1% vs. prior year to $368M. Consensus showed EPS of -$0.25 versus -$0.25 expected, while the filing showed GAAP EPS of -$2.27, so you should treat adjusted and reported profit as very different stories.
$368M
revenue
$0.25
eps
42.1%
gross margin
the number that mattered
Gross margin was 42.1%, which tells you the products still carry decent markup even while total profitability stays weak.
-
topgolf callaway has completed the sale of a majority stake of topgolf to leonard green & partners.
-
the company sold a 60% stake in topgolf to the private equity fund manager for $1.1 billion.the deal positions both companies to be separate, focused, pure-play businesses that should strive in their respective spaces.
-
the move also maintains strong marketing through a strategic partnership.
-
it also allows callaway to continue to profit from future value creation in topgolf thanks to its 40% stake in the business.in connection with the closing, the company repaid roughly $1.0 billion of outstanding debt and plans to pay off additional debt in the coming quarters. the board of directors also authorized the repurchase of up to $200 million of the company’s common stock. as a result of the transaction, the core golf company was set to be renamed callaway golf company shortly after this issue went to press.
-
also, the ticker symbol was to be changed from modg to caly.
source: company earnings report, 2026
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What could go wrong
The #1 risk is simple: Topgolf stays a 43% of revenue business without lifting companywide returns above 5.5%.
med
venue economics stay heavy
Topgolf is already the largest segment at $903M and 43% of revenue. If it remains capital-intensive without producing better companywide returns, the headline growth story does not convert into shareholder returns.
Impact: the market keeps seeing CALY as a complicated operator instead of a clean growth business.
med
thin margins meet real leverage
CALY carries $1.2B of long-term debt, equal to 31% of capital, while net profit margin is just 5.1%.
Impact: there is less room for execution mistakes when the balance sheet is fine but not bulletproof.
med
discretionary demand softens
Golf Equipment and Active Lifestyle together account for 57% of revenue. If consumers pull back on clubs, apparel, or accessories, CALY feels it outside the Topgolf story too.
Impact: you are exposed to both venue traffic risk and traditional consumer-spending risk at the same time.
med
profitability remains inconsistent
Earnings predictability sits at 45 / 100, and the FY2026 EPS estimate is a loss of $0.25 per share. That is not the setup for a smooth rerating.
Impact: a stock on 40.8x trailing earnings can get repriced fast when earnings are hard to trust.
If Topgolf traffic holds and margins rise above 6.2%, the story works. If not, you are left with a leveraged brand roll-up and a very jumpy stock.
source: institutional data · regulatory filings · risk analysis
Pay attention to
segment mix
Topgolf is already 43% of revenue
That makes the venue business the center of the story. If CALY improves, this is probably where it starts.
balance sheet
$1.2B of long-term debt against a 5.1% net margin
Those two numbers belong next to each other. Thin profits make leverage matter more.
institutional flow
net selling has lasted two straight quarters
114 buyers versus 137 sellers in 3Q2025 is not panic. It is also not support.
data quality
the target and range data is messy
The stock shows $14.17 against a 52-week range capped at $13, and the target set lists a midpoint below the stated low. Treat the target block as a clue, not a verdict.
Analyst rankings
earnings predictability
45 / 100
In human-speak, analysts do not see this as a smooth quarterly story.
balance sheet
B
The finances are workable, but not good enough to make the operating questions disappear.
price stability
20 / 100
This stock moves like a debated turnaround, not a quiet hold-forever compounder.
source: institutional data
Institutional activity
institutions have been net selling for 2 consecutive quarters — 114 buyers vs. 137 sellers in 3q2025. total institutional holdings: 0.2B shares. net selling for 2 quarters.
source: institutional data
Price targets
3-5 year target range
$5
$18
$14
current price
$11
target midpoint · 22% from current · 3-5yr high: $25 (+75% · 16% ann'l return)
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