Malibu Boats Reports 5.1% Decline in Q2 Fiscal 2025 Net Sales

Malibu Boats, Inc. reported a decline in financial performance for the second quarter of fiscal 2025, with net sales of $200.3 million, down 5.1% from $211.1 million in the same period last year. The company's gross profit remained relatively stable at $37.4 million, resulting in a gross margin of 18.7%, an increase from 17.8% in the prior year. However, net income fell significantly to $2.4 million, a 76.1% decrease compared to $10.1 million in the previous year. The decline in profitability was attributed to lower unit volumes and increased operating expenses, particularly in general and administrative costs, which rose by 71.9% to $26.5 million.

In the six months ending December 31, 2024, Malibu Boats experienced a more pronounced decline, with net sales dropping 20.4% to $371.9 million from $466.9 million in the same period of the previous year. The decrease was driven by a 26.9% reduction in unit volumes across all segments, primarily due to decreased wholesale shipments and a shift in dealer inventory strategies. The Malibu segment saw a 28.3% decline in sales, while the Saltwater Fishing segment's sales decreased by 23.1%. The Cobalt segment was the only one to report a slight increase in sales, up 3.0%.

Strategically, Malibu Boats has been focusing on enhancing its product offerings and dealer network. The company has recently launched new models and improved distribution channels, aiming to capture a larger market share in the recreational boating industry. As of December 31, 2024, Malibu Boats operated through a dealer network of over 400 locations globally. The company has also initiated a stock repurchase program, authorizing the repurchase of up to $50 million of its Class A Common Stock and LLC Units, reflecting its commitment to returning capital to shareholders.

Operationally, Malibu Boats reported a decrease in customer engagement, with total unit sales falling to 1,222 for the three months ended December 31, 2024, down from 1,373 in the same period last year. The company noted that the recreational powerboat industry continues to face challenges from macroeconomic factors, including high interest rates and fluctuating consumer demand. As a result, Malibu Boats anticipates that dealers will further reduce their inventories in fiscal 2025, which may impact future sales.

Looking ahead, Malibu Boats remains cautious about the retail market's trajectory, expecting continued declines in fiscal 2025. The company plans to leverage its strong brand portfolio and innovative product pipeline to navigate these challenges. However, it acknowledges that external factors such as inflation, supply chain disruptions, and competitive pressures could significantly influence its operational performance and market position in the coming months.