Acushnet Holdings Corp.

Previous wording

Voluntary Bridge to Retirement (“VBR”) Program: During the second quarter of 2025, we initiated a VBR program to reduce operating costs and bridge certain long-tenured eligible employees to retirement. As part of this program, eligible employees were offered severance in the form of salary and benefit continuation. In connection with the VBR program, during the three and six months ended June 30, 2025, we incurred restructuring costs of $6.4 million. We expect to incur additional restructuring costs associated with the VBR program of approximately $7.0 million in the third and fourth quarters of 2025. See “Notes to Unaudited Condensed Consolidated Financial Statements – Note 16 – Restructuring costs,” Item 1 of Part I to this report.

Current wording

Voluntary Bridge to Retirement (“VBR”) Program: During the second quarter of 2025, we initiated a VBR program to reduce operating costs and bridge certain long-tenured eligible employees to retirement. As part of this program, eligible employees were offered severance in the form of salary and benefit continuation. In connection with the VBR program, during the three and nine months ended September 30, 2025, we incurred restructuring costs of $2.1 million and $8.6 million, respectively. We expect to incur additional restructuring costs associated with the VBR program of approximately $5.0 million in the fourth quarter of 2025. See “Notes to Unaudited Condensed Consolidated Financial Statements – Note 16 – Restructuring costs,” Item 1 of Part I to this report.

Previous wording

FootJoy Footwear Joint Venture Deconsolidation: As previously disclosed, until 2024, the majority of our FootJoy footwear was manufactured in a facility in Fuzhou, China, owned by a joint venture in which we have a 40% interest, with the remaining 60% owned by our long-standing Taiwan-based supply partner. During 2024, FootJoy shifted footwear production volume from Fuzhou, China to a third-party facility located in Long An Province, Vietnam, which is operated by an affiliate of the same Taiwan-based supply partner. The joint venture ceased production at its Fuzhou, China facility in January 2025 and FootJoy currently contracts to manufacture substantially all of its footwear at the third-party owned Vietnam manufacturing facility. As a result of shifting our footwear manufacturing from the joint venture's Fuzhou, China facility, we are no longer the primary beneficiary of the joint venture and have deconsolidated the accounts of the joint venture from our unaudited condensed consolidated financial statements. As of June 30, 2025, we account for our investment in the joint venture under the equity method of accounting. As a result of this deconsolidation, we recognized a non-cash gain of $20.9 million during the six months ended June 30, 2025, and currently expect the investment may generate net losses in future periods. See “Notes to Unaudited Condensed Consolidated Financial Statements – Note 1 – Summary of Significant Accounting Policies,” Item 1 of Part I to this report.

Current wording

FootJoy Footwear Joint Venture Deconsolidation: As previously disclosed, until 2024, the majority of our FootJoy footwear was manufactured in a facility in Fuzhou, China, owned by a joint venture in which we have a 40% interest, with the remaining 60% owned by our long-standing Taiwan-based supply partner. During 2024, FootJoy shifted footwear production volume from Fuzhou, China to a third-party facility located in Long An Province, Vietnam, which is operated by an affiliate of the same Taiwan-based supply partner. The joint venture ceased production at its Fuzhou, China facility in January 2025 and FootJoy currently contracts to manufacture substantially all of its footwear at the third-party owned Vietnam manufacturing facility. As a result of shifting our footwear manufacturing from the joint venture's Fuzhou, China facility, we are no longer the primary beneficiary of the joint venture and have deconsolidated the accounts of the joint venture from our unaudited condensed consolidated financial statements. As of September 30, 2025, we account for our investment in the joint venture under the equity method of accounting. As a result of this deconsolidation, we recognized a non-cash gain of $20.9 million during the nine months ended September 30, 2025, and currently expect the investment may generate net losses in future periods. See “Notes to Unaudited Condensed Consolidated Financial Statements – Note 1 – Summary of Significant Accounting Policies,” Item 1 of Part I to this report.

Previous wording

Tariffs and Foreign Exchange: The U.S. government has recently implemented significant tariff measures, including a baseline universal tariff of 10% on virtually all products imported into the United States, as well as additional individualized tariffs on products imported from select trading partners, including Canada, China, Mexico, Thailand and Vietnam. As a result, we are incurring tariff costs in connection with imports from every country from which we import raw materials, component parts and finished goods, and increased U.S. tariffs have led and may continue to lead to the imposition of retaliatory tariffs by foreign jurisdictions. Additionally, the U.S. government has announced and rescinded multiple tariffs on several foreign jurisdictions, which has increased uncertainty regarding the ultimate effect of the tariffs on economic conditions. Current uncertainties about tariffs and their effects on trading relationships may further affect the costs of our imported raw materials, components parts and finished goods and increase market volatility and currency exchange rate fluctuations. We continue to monitor the economic effects of these developments and evaluate opportunities to mitigate their related impacts. See “Risk Factors,” Item 1A of Part II to this report, for additional information.

Current wording

Tariffs and Foreign Exchange: The U.S. government has recently implemented significant tariff measures, including a baseline tariff of 10% on most products imported into the United States, as well as individualized tariffs on products imported from select trading partners, including Canada, China, Mexico, Thailand and Vietnam. As a result, we are incurring incremental tariff costs in connection with importing raw materials, component parts and finished goods, and increased U.S. tariffs have led and may continue to lead to the imposition of retaliatory tariffs by foreign jurisdictions. Additionally, the U.S. government has announced and rescinded multiple tariffs on several foreign jurisdictions, which has increased uncertainty regarding the ultimate effect of the tariffs on economic conditions. Current uncertainties about tariffs and their effects on trading relationships may further affect the costs of our imported raw materials, components parts and finished goods and increase market volatility and currency exchange rate fluctuations. We continue to monitor the economic effects of these developments and evaluate opportunities to mitigate their related impacts. See “Risk Factors,” Item 1A of Part II to this report, for additional information.

Previous wording

One Big Beautiful Bill Act: On July 4, 2025, the U.S. government enacted the One Big Beautiful Bill Act, which includes, among other provisions, changes to the U.S. corporate income tax system including the allowance of immediate expensing of qualifying research and development expenses and permanent extensions of certain provisions within the Tax Cuts and Jobs Act. The legislation has multiple effective dates, with certain provisions effective in 2025 and others in future periods. We are currently assessing the impact of the legislation on our consolidated financial statements.

Current wording

One Big Beautiful Bill Act ("OBBBA"): On July 4, 2025, the U.S. government enacted the OBBBA, which includes, among other provisions, changes to the U.S. corporate income tax system including the allowance of immediate expensing of qualifying research and development expenses and permanent extensions of certain provisions within the Tax Cuts and Jobs Act. The legislation has multiple effective dates, with certain provisions effective in 2025 and others in future periods. The Company has completed its initial assessment of the enacted law and has included the impact of the enactment within its consolidated financial statements for the nine months ended September 30, 2025.

Previous wording

(1) For the three and six months ended June 30, 2025, includes $6.4 million related to the VBR program. For the six months ended June 30, 2024, includes $7.0 million related to the optimization of our supply chain.

Current wording

(1) For the three and nine months ended September 30, 2025, includes $2.1 million and $8.6 million, respectively, related to the VBR program. For the nine months ended September 30, 2024, includes $7.0 million related to the optimization of our supply chain.

Previous wording

(2) For the three and six months ended June 30, 2025, includes $3.4 million and $6.0 million, respectively, related to our information technology optimization. For the three and six months ended June 30, 2024, includes $2.8 million and $5.9 million, respectively, related to our information technology optimization.

Current wording

(2) For the three and nine months ended September 30, 2025, includes $1.8 million and $7.8 million, respectively, related to our information technology optimization. For the three and nine months ended September 30, 2024, includes $2.1 million and $8.0 million, respectively, related to our information technology optimization.

Previous wording

(4)For the three and six months ended June 30, 2025, includes $0.6 million and $1.3 million, respectively, related to the amortization of capitalized implementation costs for cloud computing arrangements. For the six months ended June 30, 2025, includes a non-cash gain of $20.9 million related to the FootJoy footwear joint venture deconsolidation. In addition, the three and six months ended June 30, 2025 and 2024 include other gains, losses or costs added back for purposes of calculating Adjusted EBITDA as defined in our credit agreement.

Current wording

(4)For the three and nine months ended September 30, 2025, includes $0.6 million and $1.9 million, respectively, related to the amortization of capitalized implementation costs for cloud computing arrangements. For the three and nine months ended September 30, 2025, includes pension settlement costs of $0.9 million related to lump-sum distributions to participants in our defined benefit plans as a result of the VBR program. For the nine months ended September 30, 2025, includes a non-cash gain of $20.9 million related to the FootJoy footwear joint venture deconsolidation. In addition, the three and nine months ended September 30, 2025 and 2024 include other gains, losses or costs added back for purposes of calculating Adjusted EBITDA as defined in our credit agreement.

Previous wording

For the three months ended June 30, 2025, net sales increased 5.4%, or 4.7% on a constant currency basis, compared to the three months ended June 30, 2024. The increase was driven by higher net sales in Titleist golf equipment, primarily due to higher average selling prices in golf clubs and higher sales volumes in golf balls, as well as higher net sales in Golf gear. These increases were partially offset by lower net sales in FootJoy golf wear in the footwear category. An increase in net sales of products that are not allocated to one of our three reportable segments also contributed to the change in net sales.

Current wording

For the three months ended September 30, 2025, net sales increased 6.0%, or 5.3% on a constant currency basis, compared to the three months ended September 30, 2024. The increase was driven by higher net sales in Titleist golf equipment, primarily due to higher average selling prices in golf clubs and sales volumes in golf balls, as well as higher net sales in Golf gear and FootJoy golf wear, primarily due to higher average selling prices across all product categories in both segments.

Previous wording

The increase in net sales in the United States was largely driven by increases in Titleist golf equipment of $20.7 million and in Golf gear of $4.8 million, partially offset by a decrease in FootJoy golf wear of $1.6 million. The increase in Titleist golf equipment was primarily driven by higher sales volumes of our GT drivers, fairways and hybrids and higher average selling prices across all golf club product categories, as well as higher sales volumes of our 2025 Pro V1 golf ball models. These increases were partially offset by lower sales volumes of second model year irons and Phantom putters. The increase in Golf gear was primarily driven by higher sales volumes in golf bags and golf gloves. The decrease in FootJoy golf wear was primarily due to lower sales volumes in footwear, partially offset by higher average selling prices in footwear and golf gloves.

Current wording

The increase in net sales in the United States was largely driven by increases in Titleist golf equipment of $13.4 million, in Golf gear of $4.8 million and in FootJoy golf wear of $2.4 million. The increase in Titleist golf equipment was primarily driven by higher average selling prices in golf clubs, as well as higher sales volumes of our 2025 Pro V1 golf ball models. In addition, higher sales volumes of our newly introduced T-Series irons and second model year SM10 wedges were more than offset by lower sales volumes of second model year drivers and fairways. The increase in Golf gear was primarily driven by higher average selling prices across all product categories. The increase in FootJoy golf wear was primarily due to higher average selling prices in golf gloves and apparel. An increase in net sales of products that are not allocated to one of our three reportable segments also contributed to the change in net sales.

Previous wording

Net sales in regions outside the United States increased 3.8%, or 2.3% on a constant currency basis driven by increases in EMEA and Rest of World, partially offset by decreases in Korea and Japan. In EMEA, the increase was primarily driven by higher net sales in Titleist golf equipment, largely due to golf balls, and higher net sales in Golf gear. In Rest of World, the increase was primarily driven by higher net sales in Titleist golf equipment. In Korea, the decrease was primarily due to lower net sales in Golf gear and FootJoy golf wear, partially offset by higher net sales of products that are not allocated to one of our three reportable segments. In Japan, the decrease was primarily due to lower net sales in FootJoy golf wear.

Current wording

Net sales in regions outside the United States increased 5.8%, or 4.0% on a constant currency basis, driven by increases in EMEA, Rest of World and Korea, partially offset by a decrease in Japan. In EMEA and Rest of World, the increases were driven by higher net sales across all reportable segments. In Korea, the increase was primarily due to higher net sales in Titleist golf equipment, largely due to golf balls. In Japan, the decrease was due to lower net sales across all reportable segments, as well as lower net sales of products that are not allocated to one of our three reportable segments.

Previous wording

Gross profit increased $20.8 million for the three months ended June 30, 2025 compared to the three months ended June 30, 2024. Gross margin increased to 49.2% for the three months ended June 30, 2025 compared to 48.8% for the three months ended June 30, 2024. The increase in gross profit was primarily the result of increases in Titleist golf equipment of $10.8 million, in Golf gear of $4.7 million and in FootJoy golf wear of $2.9 million. The increase in Titleist golf equipment was primarily due to the higher sales volumes and higher average selling prices discussed previously, partially offset by an unfavorable shift in product mix. The increase in Golf gear was primarily due to the higher sales volumes discussed previously, as well as higher average selling prices and lower distribution costs. The increase in FootJoy golf wear was primarily due to lower manufacturing costs and a favorable shift in product mix. An increase in gross profit of products not allocated to one of our three reportable segments also contributed to the change in gross profit.

Current wording

Gross profit increased $14.9 million for the three months ended September 30, 2025 compared to the three months ended September 30, 2024. Gross margin decreased to 48.5% for the three months ended September 30, 2025 compared to 49.0% for the three months ended September 30, 2024. The increase in gross profit was primarily the result of increases in Titleist golf equipment of $6.8 million, in FootJoy golf wear of $3.7 million and in Golf gear of $3.1 million. The increase in Titleist golf equipment was primarily due to the higher sales volumes and higher average selling prices discussed previously, partially offset by an unfavorable shift in product mix. The increase in FootJoy golf wear was primarily due to the higher average selling prices discussed previously and a favorable shift in product mix. The increase in Golf gear was primarily due to the higher average selling prices discussed previously. An increase in gross profit of products not allocated to one of our three reportable segments also contributed to the change in gross profit. These changes in gross profit also include higher tariff costs due to the tariff measures discussed previously.

Previous wording

Selling, general and administrative (“SG&A”) expenses increased $14.2 million for the three months ended June 30, 2025 compared to the three months ended June 30, 2024. This increase was primarily the result of increases of $4.1 million in selling expense, $3.1 million in administrative expense and $1.9 million in advertising and promotion expenses, as well as increases in other expenses, primarily due to $6.4 million in restructuring costs associated with our VBR program. The increase in selling expense was primarily due to Titleist golf equipment fitting network investments. Higher information technology-related expenses contributed to the increase in administrative expense. The increase in advertising and promotion expenses was primarily in Titleist golf equipment to support new product launches.

Current wording

Selling, general and administrative (“SG&A”) expenses increased $5.2 million for the three months ended September 30, 2025 compared to the three months ended September 30, 2024. This increase was primarily the result of increases of $4.1 million in advertising and promotion expenses and $2.8 million in selling expense, partially offset by a $1.6 million decrease in administrative expense. The increase in advertising and promotion expenses was primarily in Titleist golf equipment to support new product launches. The increase in selling expense was primarily due to investments in our product fitting networks and to enhance consumer engagement. SG&A expenses also include a $1.7 million decrease in losses on foreign exchange forward contracts. In addition, during the three months ended September 30, 2025, SG&A expenses include restructuring costs of $2.1 million related to the VBR program.

Previous wording

Interest expense, net increased $1.1 million for the three months ended June 30, 2025 compared to the three months ended June 30, 2024, primarily due to an increase in borrowings, partially offset by a decrease in interest rates.

Current wording

Interest expense, net increased $1.3 million for the three months ended September 30, 2025 compared to the three months ended September 30, 2024, primarily due to an increase in borrowings, partially offset by a decrease in interest rates, as well as an increase in interest capitalized related to our information technology optimization.

Previous wording

Income tax expense decreased $2.6 million for the three months ended June 30, 2025 compared to the three months ended June 30, 2024. Our effective income tax rate (“ETR”) was 19.9% for the three months ended June 30, 2025 compared to 23.2% for the three months ended June 30, 2024. The change in ETR was primarily driven by changes in our jurisdictional mix of earnings.

Current wording

Income tax expense increased $15.4 million for the three months ended September 30, 2025 compared to the three months ended September 30, 2024. Our effective income tax rate (“ETR”) was 37.3% for the three months ended September 30, 2025 compared to 19.3% for the three months ended September 30, 2024. The change in ETR was primarily driven by changes in our jurisdictional mix of earnings, as well as a reduced income tax benefit related to the U.S. deduction of foreign-derived intangible income resulting from the enactment of the OBBBA.

Previous wording

Net sales in our Titleist golf equipment segment increased 6.8%, or 6.1% on a constant currency basis, for the three months ended June 30, 2025 compared to the three months ended June 30, 2024, primarily driven by higher average selling prices across all golf club product categories and higher sales volumes of our 2025 Pro V1 golf ball models. In addition, higher sales volumes of our GT drivers and fairways launched in the third quarter of 2024 and GT hybrids launched in the first quarter of 2025 were more than offset by lower sales volumes of second model year irons, Phantom putters and wedges.

Current wording

Net sales in our Titleist golf equipment segment increased 5.7%, or 5.0% on a constant currency basis, for the three months ended September 30, 2025 compared to the three months ended September 30, 2024, primarily driven by higher average selling prices across all golf club product categories and sales volumes of our 2025 Pro V1 golf ball models. In addition, higher sales volumes of our T-Series irons launched in the third quarter of 2025 and SM10 wedges were more than offset by lower sales volumes of second model year drivers and fairways.

Previous wording

Operating income in our Golf gear segment increased $3.2 million, or 22.9% compared to the prior year period, largely as a result of an increase of $4.7 million in gross profit primarily driven by the higher sales volumes, higher average selling prices and lower distribution costs discussed previously. An increase in operating expenses of $1.5 million partially offset the increase in gross profit.

Current wording

Operating income in our Golf gear segment increased $3.1 million, or 75.6% compared to the prior year period, largely as a result of an increase of $3.1 million in gross profit, primarily driven by the higher average selling prices discussed previously, partially offset by higher tariff costs.

Previous wording

For the six months ended June 30, 2025, net sales increased 2.3%, or 2.9% on a constant currency basis, compared to the six months ended June 30, 2024. The increase was driven by higher net sales in Titleist golf equipment, primarily due to higher average selling prices in golf clubs and higher sales volumes in golf balls, as well as higher net sales in Golf gear. These increases were partially offset by lower net sales in FootJoy golf wear in footwear and apparel categories. An increase in net sales of products that are not allocated to one of our three reportable segments also contributed to the change in net sales.

Current wording

For the nine months ended September 30, 2025, net sales increased 3.5%, or 3.6% on a constant currency basis, compared to the nine months ended September 30, 2024. The increase was driven by higher net sales in Titleist golf equipment, primarily due to higher average selling prices in golf clubs and sales volumes in golf balls, as well as higher net sales in Golf gear, primarily due to higher average selling prices across all product categories. These increases were partially offset by lower net sales in FootJoy golf wear, primarily due to lower sales volumes in footwear, partially offset by higher average selling prices. An increase in net sales of products that are not allocated to one of our three reportable segments also contributed to the change in net sales.

Previous wording

The increase in net sales in the United States was primarily driven by increases in Titleist golf equipment of $31.0 million and in Golf gear of $5.4 million, partially offset by a decrease in FootJoy golf wear of $7.3 million. The increase in Titleist golf equipment was primarily driven by higher sales volumes of our GT drivers, fairways and hybrids, as well as higher sales volumes of our 2025 Pro V1 golf ball models and higher average selling prices in golf clubs. These increases were partially offset by lower sales volumes of second model year irons, wedges and performance model golf balls. The increase in Golf gear was primarily driven by higher sales volumes in golf gloves and golf bags and higher average selling prices across all product categories. The decrease in FootJoy golf wear was primarily due to lower sales volumes in footwear, partially offset by higher average selling prices across all product categories.

Current wording

The increase in net sales in the United States was primarily driven by increases in Titleist golf equipment of $44.4 million and in Golf gear of $10.2 million, partially offset by a decrease in FootJoy golf wear of $4.9 million. The increase in Titleist golf equipment was primarily driven by higher average selling prices in golf clubs and higher sales volumes of our 2025 Pro V1 golf ball models and GT hybrids. These increases were partially offset by lower sales volumes of second model year wedges, drivers and performance model golf balls. The increase in Golf gear was primarily driven by higher average selling prices across all product categories and higher sales volumes in golf gloves. The decrease in FootJoy golf wear was primarily due to lower sales volumes in footwear, partially offset by higher average selling prices across all product categories. An increase in net sales of products that are not allocated to one of our three reportable segments also contributed to the change in net sales.

Previous wording

Net sales in regions outside the United States increased 0.1%, or 1.5% on a constant currency basis driven by increases in EMEA and Rest of World, partially offset by decreases in Korea and Japan. In EMEA, the increase was driven by higher net sales across all reportable segments, primarily in Titleist golf equipment, due to golf balls, and in Golf gear. In Rest of World, the increase was primarily driven by higher net sales in Titleist golf equipment and products that are not allocated to one of our three reportable segments. In Korea, the decrease was largely due to lower net sales in FootJoy golf wear, primarily footwear and apparel, and Golf gear. In Japan, the decrease was primarily due to lower net sales in FootJoy golf wear across all product categories.

Current wording

Net sales in regions outside the United States increased 1.8%, or 2.3% on a constant currency basis driven by increases in EMEA and Rest of World, partially offset by decreases in Japan and Korea. In EMEA and Rest of World, the increases were driven by higher net sales across all reportable segments. An increase in net sales of products that are not allocated to one of our three reportable segments also contributed to the change in net sales in Rest of World. In Japan, the decrease was due to lower net sales across all reportable segments, primarily in FootJoy golf wear in the footwear and apparel product categories, as well as in net sales of products that are not allocated to one of our three reportable segments. In Korea, the decrease was largely due to lower net sales in FootJoy golf wear, primarily footwear, and Golf gear, partially offset by higher net sales in Titleist golf equipment.

Previous wording

Gross profit increased $15.7 million for the six months ended June 30, 2025 compared to the six months ended June 30, 2024. Gross margin was 48.6% for the six months ended June 30, 2025 and 2024. The increase in gross profit was primarily the result of increases in Golf gear of $9.2 million and Titleist golf equipment of $5.6 million. The increase in Golf gear was primarily driven by higher average selling prices and lower distribution costs. The increase in Titleist golf equipment was primarily due to the higher sales volumes and higher average selling prices discussed previously, partially offset by higher manufacturing costs.

Current wording

Gross profit increased $30.6 million for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. Gross margin was 48.6% for the nine months ended September 30, 2025 compared to 48.7% for the nine months ended September 30, 2024. The increase in gross profit was primarily the result of increases in Titleist golf equipment of $12.5 million, Golf gear of $12.3 million and FootJoy golf wear of $2.7 million. The increase in Titleist golf equipment was primarily due to the higher sales volumes and higher average selling prices discussed previously, partially offset by higher manufacturing costs. The increase in Golf gear was primarily driven by the higher average selling prices discussed previously and lower distribution costs. The increase in FootJoy golf wear was primarily driven by the higher average selling prices and a favorable shift in product mix, partially offset by lower sales volumes discussed previously. An increase in gross profit of products not allocated to one of our three reportable segments also contributed to the change in gross profit. These changes in gross profit also include higher tariff costs due to the tariff measures discussed previously.

Previous wording

SG&A expenses increased $13.5 million for the six months ended June 30, 2025 compared to the six months ended June 30, 2024. This increase was primarily the result of increases of $8.1 million in advertising and promotion expenses, $6.2 million in selling expense and $2.7 million in administrative expense. The increase in advertising and promotion expenses was primarily in Titleist golf equipment to support new product launches. The increase in selling expense was primarily due to Titleist golf equipment fitting network investments. The increase in administrative expense was primarily due to higher information technology-related and employee-related expenses. In addition, during the six months ended June 30, 2025 and 2024, SG&A expenses include restructuring costs of $6.4 million related to the VBR program and $7.0 million related to the optimization of our supply chain, respectively. These changes in SG&A expenses include the favorable impact of changes in foreign currency exchange rates.

Current wording

SG&A expenses increased $18.7 million for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. This increase was primarily the result of increases of $12.2 million in advertising and promotion expenses and $9.0 million in selling expense. The increase in advertising and promotion expenses was primarily in Titleist golf equipment to support new product launches. The increase in selling expense was primarily due to investments in our product fitting networks and to enhance consumer engagement. SG&A expenses also include a $2.2 million decrease in expense related to our distribution optimization, as well as a $5.4 million decrease in foreign currency transaction losses, offset in part by a $2.8 million increase in losses on foreign exchange forward contracts. In addition, for the nine months ended September 30, 2025 and 2024, SG&A expenses also include restructuring costs of $8.6 million related to the VBR program and $7.0 million related to the optimization of our supply chain, respectively.

Previous wording

Research and development expenses increased $2.8 million for the three months ended June 30, 2025 compared to the three months ended June 30, 2024, primarily as a result of additional expenses to support next generation product introductions.

Current wording

Research and development expenses increased $4.9 million for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, primarily as a result of additional expenses to support next generation product introductions.

Previous wording

Interest expense, net increased $1.8 million for the six months ended June 30, 2025 compared to the six months ended June 30, 2024, primarily due to an increase in borrowings, partially offset by a decrease in interest rates.

Current wording

Interest expense, net increased $3.1 million for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, primarily due to an increase in borrowings, partially offset by a decrease in interest rates, as well as an increase in interest capitalized related to our information technology optimization.

Previous wording

Other income, net increased $19.8 million for the six months ended June 30, 2025 compared to other expense, net of $0.9 million for the six months ended June 30, 2024, primarily due to a non-cash gain of $20.9 million related to the FootJoy footwear joint venture deconsolidation.

Current wording

Other income, net increased $18.4 million for the nine months ended September 30, 2025 compared to other expense, net of $1.3 million for the nine months ended September 30, 2024, primarily due to a non-cash gain of $20.9 million related to the FootJoy footwear joint venture deconsolidation. This increase in other income, net was partially offset by an increase of $1.6 million in the non-service cost component of net periodic benefit costs driven by an increase in settlement costs, partially as a result of the VBR program.

Previous wording

Income tax expense decreased $4.4 million for the six months ended June 30, 2025 compared to the six months ended June 30, 2024. Our ETR was 18.7% for the six months ended June 30, 2025 compared to 22.4% for the six months ended June 30, 2024. The change in ETR was primarily driven by changes in our jurisdictional mix of earnings.

Current wording

Income tax expense increased $11.0 million for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. Our ETR was 23.6% for the nine months ended September 30, 2025 compared to 21.6% for the nine months ended September 30, 2024. The change in ETR was primarily driven by changes in our jurisdictional mix of earnings, as well as a reduced income tax benefit related to the U.S. deduction of foreign-derived intangible income resulting from the enactment of the OBBBA.

Previous wording

Net sales in our Titleist golf equipment segment increased 4.5%, or 4.9% on a constant currency basis, for the six months ended June 30, 2025 compared to the six months ended June 30, 2024, primarily driven by higher sales volumes of our 2025 Pro V1 golf ball models and higher average selling prices in golf clubs. In addition, higher sales volumes of our GT drivers and fairways launched in the third quarter of 2024 and GT hybrids launched in the first quarter of 2025 were more than offset by lower sales volumes of second model year wedges, irons and performance model golf balls.

Current wording

Net sales in our Titleist golf equipment segment increased 4.9%, or 5.0% on a constant currency basis, for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, primarily driven by higher average selling prices in golf clubs and sales volumes of our 2025 Pro V1 golf ball models. In addition, higher sales volumes of our GT hybrids launched in the first quarter of 2025 and T-Series irons launched in the third quarter of 2025 were more than offset by lower sales volumes of second model year wedges, drivers and performance model golf balls.

Previous wording

Operating income in our Titleist golf equipment segment decreased $16.2 million, or 9.1% compared to the prior year period. The decrease in operating income resulted from higher operating expenses of $21.8 million partially offset by an increase in gross profit of $5.6 million. The increase in gross profit was primarily driven by the higher sales volumes and higher average selling prices, partially offset by higher manufacturing costs, as discussed previously. Higher operating expenses were a result of increases of $8.6 million in advertising and promotion expenses, $5.8 million in selling expense, $4.4 million in research and development expenses and $3.0 million in administrative expense.

Current wording

Operating income in our Titleist golf equipment segment decreased $13.6 million, or 5.3% compared to the prior year period. The decrease in operating income resulted from higher operating expenses of $26.8 million partially offset by an increase in gross profit of $12.5 million. The increase in gross profit was primarily driven by the higher sales volumes and higher average selling prices as discussed previously, partially offset by higher tariff and manufacturing costs. Higher operating expenses were a result of increases of $12.5 million in advertising and promotion expenses, $7.7 million in selling expense, $4.0 million in research and development expenses and $2.7 million in administrative expense.

Previous wording

Operating income in our FootJoy golf wear segment increased $1.4 million, or 4.0% compared to the prior year period. The increase in operating income resulted from lower operating expenses of $2.4 million, partially offset by lower gross profit of $1.0 million. Gross profit decreased primarily as a result of the sales volume decline, partially offset by the higher average selling prices discussed previously. Lower operating expenses were primarily a result of a decrease of $1.8 million in advertising and promotion expenses.

Current wording

Operating income in our FootJoy golf wear segment increased $5.6 million, or 15.8% compared to the prior year period. The increase in operating income resulted from lower operating expenses of $2.9 million and higher gross profit of $2.7 million. Gross profit increased primarily as a result of the higher average selling prices discussed previously and a favorable shift in product mix, partially offset by lower sales volumes as discussed previously and higher tariff costs. Lower operating expenses were primarily a result of decreases of $1.5 million in advertising and promotion expenses and $1.2 million in administrative expense.

Previous wording

Net sales in our Golf gear segment increased 5.0%, or 5.5% on a constant currency basis, for the six months ended June 30, 2025 compared to the six months ended June 30, 2024, driven by higher average selling prices across all product categories and higher sales volumes in golf gloves and golf bags.

Current wording

Net sales in our Golf gear segment increased 7.5%, or 7.7% on a constant currency basis, for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, driven by higher average selling prices across all product categories and higher sales volumes in golf gloves.

Previous wording

Operating income in our Golf gear segment increased $7.3 million, or 30.9% compared to the prior year period. The increase in operating income resulted from higher gross profit of $9.2 million, largely due to higher average selling prices and lower distribution costs discussed previously.

Current wording

Operating income in our Golf gear segment increased $10.4 million, or 37.5% compared to the prior year period. The increase in operating income resulted from higher gross profit of $12.3 million, largely due to the higher average selling prices and lower distribution costs discussed previously, partially offset by higher tariff costs.

Previous wording

As of June 30, 2025, we had $58.8 million of unrestricted cash and cash equivalents. As of June 30, 2025, 93.7% of our total unrestricted cash and cash equivalents was held by subsidiaries in regions outside of the United States. We manage our worldwide cash requirements by monitoring the funds available among our subsidiaries and determining the extent to which we can access those funds on a cost-effective basis. We are not aware of any restrictions on repatriation of these funds and, subject to foreign withholding taxes, those funds could be repatriated, if necessary. We have repatriated, and intend to repatriate, funds to the United States from time to time to satisfy domestic liquidity needs arising in the ordinary course of business.

Current wording

As of September 30, 2025, we had $88.1 million of unrestricted cash and cash equivalents. As of September 30, 2025, 97.1% of our total unrestricted cash and cash equivalents was held by subsidiaries in regions outside of the United States. We manage our worldwide cash requirements by monitoring the funds available among our subsidiaries and determining the extent to which we can access those funds on a cost-effective basis. We are not aware of any restrictions on repatriation of these funds and, subject to foreign withholding taxes, those funds could be repatriated, if necessary. We have repatriated, and intend to repatriate, funds to the United States from time to time to satisfy domestic liquidity needs arising in the ordinary course of business.

Previous wording

As of June 30, 2025, we had $383.3 million of availability under our multi-currency revolving credit facility after giving effect to $4.2 million of outstanding letters of credit. Additionally, we had $35.4 million available under certain local credit facilities of our subsidiaries.

Current wording

As of September 30, 2025, we had $416.1 million of availability under our multi-currency revolving credit facility after giving effect to $4.2 million of outstanding letters of credit. Additionally, we had $33.2 million available under certain local credit facilities of our subsidiaries.

Previous wording

During the six months ended June 30, 2025, we paid dividends on our common stock of $28.6 million to our shareholders. During the third quarter of 2025, our board of directors declared a dividend of $0.235 per share of common stock to shareholders of record as of September 5, 2025 and payable on September 19, 2025.

Current wording

During the nine months ended September 30, 2025, we paid dividends on our common stock of $42.4 million to our shareholders. During the fourth quarter of 2025, our board of directors declared a dividend of $0.235 per share of common stock to shareholders of record as of December 5, 2025 and payable on December 19, 2025.

Previous wording

During the six months ended June 30, 2025, we repurchased 1,889,313 shares of our common stock at an average price of $66.17 for an aggregate of $125.0 million. Included in this amount were 935,907 shares of our common stock repurchased from Magnus Holdings Co., Ltd. ("Magnus"), for an aggregate of $62.5 million. As of June 30, 2025, we recognized a liability of $62.5 million to purchase an additional 953,406 shares of common stock from Magnus. As of June 30, 2025, we had $327.2 million remaining under the current share repurchase authorization, of which $62.5 million was utilized on July 10, 2025, to repurchase 953,406 shares of our common stock from Magnus in satisfaction of our previously disclosed obligations under a share repurchase agreement with Magnus.

Current wording

During the nine months ended September 30, 2025, we repurchased 2,842,719 shares of our common stock at an average price of $65.96 for an aggregate of $187.5 million. Included in this amount were 1,889,313 shares of our common stock repurchased from Magnus Holdings Co., Ltd. ("Magnus"), for an aggregate of $125.0 million. As of September 30, 2025, we had $264.7 million remaining under the current share repurchase authorization.

Previous wording

During the six months ended June 30, 2025, we invested $25.1 million in capital expenditures. We expect to invest approximately $70.0 million in capital expenditures for the full year, although actual amounts may vary depending upon a variety of factors, including the timing of certain capital project implementations and receipt of capital purchases. Capital expenditures generally relate to investments to support the manufacturing and distribution of products, our go-to-market activities, as well as investments in facilities to support our global strategic initiatives.

Current wording

During the nine months ended September 30, 2025, we invested $51.3 million in capital expenditures. We expect to invest approximately $75.0 million in capital expenditures for the full year, although actual amounts may vary depending upon a variety of factors, including the timing of certain capital project implementations and receipt of capital purchases. Capital expenditures generally relate to investments to support the manufacturing and distribution of products, our go-to-market activities, as well as investments in facilities to support our global strategic initiatives.

Previous wording

In addition, during the six months ended June 30, 2025, we invested $21.2 million in capitalized implementation costs associated with the implementation of a new global cloud-based enterprise resource planning ("ERP") platform as part of our plans to integrate our operations and enhance our supply chain and finance capabilities. We expect to invest approximately $30.0 to $35.0 million in capitalized implementation costs associated with this global ERP platform for the full year.

Current wording

In addition, during the nine months ended September 30, 2025, we invested $29.7 million in capitalized implementation costs associated with the implementation of a new global cloud-based enterprise resource planning ("ERP") platform as part of our plans to integrate our operations and enhance our supply chain and finance capabilities. We expect to invest approximately $35.0 million in capitalized implementation costs associated with this global ERP platform for the full year.

Previous wording

The decrease in cash provided by operating activities was primarily driven by an increase in cash used to fund working capital. At any specific point in time, working capital is subject to many variables, including seasonality and inventory management, the timing of cash receipts and payments, vendor payment terms and fluctuations in foreign exchange rates.

Current wording

The decrease in cash provided by operating activities was primarily driven by investments in our global ERP platform, as well as an increase in cash used to fund other working capital requirements. At any specific point in time, working capital is subject to many variables, including seasonality and inventory management, the timing of cash receipts and payments, vendor payment terms and fluctuations in foreign exchange rates.

Previous wording

The increase in cash used in investing activities was primarily driven by changes in capital expenditures.

Current wording

The increase in cash used in investing activities was driven by changes in capital expenditures.