TORO CO

We operate in two reportable business segments: Professional and Residential. Segment earnings for our Professional and Residential segments are defined as earnings from operations plus other income, net. Our remaining activities are presented as "Other" due to their insignificance. Operating loss for our Other activities included earnings (loss) from our wholly-owned domestic distribution company, Red Iron joint venture, corporate activities, other income, and interest expense. Corporate activities include general corporate expenditures, such as finance, human resources, legal, information services, public relations, and similar activities, as well as other unallocated corporate assets and liabilities, such as corporate facilities and deferred tax assets and liabilities. The following tables summarize net sales for our reportable business segments and Other activities:

The following tables summarize segment earnings for our reportable business segments and operating (loss) for our Other activities:

Professional Segment

Segment Net Sales

Worldwide net sales for our Professional segment for the second quarter of fiscal 2024 decreased 5.9 percent compared to the second quarter of fiscal 2023. This decrease was driven primarily by lower shipments of zero-turn mowers, partially offset by higher shipments of underground and specialty construction equipment and golf and grounds products. Worldwide net sales for our Professional segment for the year-to-date period of fiscal 2024 decreased 9.6 percent compared to the same period of fiscal 2023. This decrease was driven primarily by lower shipments of zero-turn mowers and snow and ice management products, partially offset by higher shipments of underground and specialty construction equipment and golf and grounds products.

Segment Earnings

Professional segment earnings for the second quarter of fiscal 2024 decreased 16.2 percent compared to the second quarter of fiscal 2023, and Professional segment earnings margin decreased to 19.0 percent from 21.3 percent for the second quarter of fiscal 2023. Professional segment earnings for the year-to-date period of fiscal 2024 decreased 18.3 percent compared to the same period of fiscal 2023, and Professional segment earnings margin decreased to 17.2 percent from 19.1 percent for the year-to-date period of fiscal 2023. The decrease in Professional segment earnings margin for both the second quarter and year-to-date periods of fiscal 2024 was primarily due to lower net sales volume and higher material and manufacturing costs, partially offset by productivity improvements.

Residential Segment

Segment Net Sales

Worldwide net sales for our Residential segment for the second quarter of fiscal 2024 increased 26.3 percent compared to the second quarter of fiscal 2023. The increase in Residential segment net sales was primarily driven by higher shipments to our mass channel, partially offset by lower shipments to our dealer channel. Worldwide net sales for our Residential segment for the year-to-date period of fiscal 2024 increased 8.5 percent compared to the same period of fiscal 2023. The increase in Residential segment net sales was primarily driven by higher shipments to our mass channel, partially offset by lower shipments of snow and ice management products.

Segment Earnings

Residential segment earnings for the second quarter of fiscal 2024 increased 59.0 percent compared to the second quarter of fiscal 2023, and Residential segment earnings margin increased to 10.8 percent from 8.6 percent in the second quarter of fiscal 2023. The increase in Residential segment earnings margin for the second quarter of fiscal 2024 was largely driven by net sales leverage and productivity improvements, partially offset by product mix and higher material and manufacturing costs. Residential segment earnings for the year-to-date period of fiscal 2024 decreased 1.5 percent compared to the same period of fiscal 2023, and Residential segment earnings margin decreased to 10.4 percent from 11.4 percent in the year-to-date period of fiscal 2023. The decrease in Residential segment earnings margin for the year-to-date period of fiscal 2023 was largely driven by product mix and higher material and manufacturing costs, partially offset by net sales leverage and productivity improvements.

Other Activities

Other Net Sales

Net sales for our Other activities includes sales from our wholly-owned domestic distribution company net of intersegment sales from the Professional and Residential segments to the distribution company. Net sales for our Other activities in the second quarter of fiscal 2024 increased by $3.0 million compared to the same period in fiscal 2023. Net sales for our Other activities in the year-to-date period of fiscal 2024 increased by $4.8 million compared to the same period in fiscal 2023.

Other Operating Loss

The operating loss for our Other activities for the second quarter of fiscal 2024 increased $8.2 million compared to the second quarter of fiscal 2023. The operating loss for our Other activities for the year-to-date period of fiscal 2024 increased $13.8 million compared to the same period in fiscal 2023. The increased operating losses for both the second quarter and year-to-date periods of fiscal 2024 were primarily due to higher corporate expenses and higher interest expense.