Brunswick delivered full-year net sales of $5.4 billion in 2025, marking the first annual increase in three years, up 2% year-over-year. Adjusted EPS for the full year was $3.27, reflecting continued tariff headwinds in the fourth quarter. Retail boat unit sales in the U.S. declined about 9% in 2025, but Brunswick’s global retail unit sales fell only 5%, driven by strength in premium and core categories, which represent roughly 75% of the company’s portfolio and 90% of its gross margin. Dealer inventories remained very low at year-end, with new model-year product accounting for the majority of stock on hand. Brunswick noted that its global order backlog equaled 79% of the first-quarter wholesale forecast, up 13 percentage points from a year earlier, positioning the company well for early 2026 shipments.

Brunswick generated $442 million in free cash flow for 2025, a 56% increase over the prior year and the third-highest annual free cash flow in company history. This robust cash generation enabled an $80 million share repurchase program, a dividend increase, and the retirement of approximately $240 million of debt. In the fourth quarter alone, free cash flow reached $88 million, reflecting normalized working capital levels and ramped production. The company ended 2025 with $1.3 billion of liquidity, including an undrawn revolving credit facility, and converted $300 million of long-term debt into commercial paper in December. Ongoing balance sheet actions are expected to reduce interest expense by about $40 million in 2026.

In the propulsion segment, sales rose 23% in Q4 with double-digit growth across outboards, sterndrives and pontoon engines, driving significant earnings and margin expansion despite tariff and compensation headwinds. Mercury Marine maintained its leadership with a 47% U.S. retail outboard market share at year-end, up 70 basis points in H2, and achieved wholesale share gains of over 400 basis points in Q4 and 900 basis points in December. The Navico Group posted its second consecutive quarter of sales growth, up 4%, while expanding adjusted operating margin by 180 basis points through improved operational execution. Brunswick Boat Group saw Q4 sales rise 11% and adjusted operating margin expand 290 basis points on pricing actions and reduced discounting. Freedom Boat Club grew to 442 global locations with member trips exceeding 640,000, up 5%.

For 2026, Brunswick guided to revenues of $5.6 billion to $5.8 billion, adjusted operating margin of 7.5% to 8% and adjusted EPS of $3.80 to $4.40. The outlook assumes a flat to modestly up U.S. retail boat market, stable boating participation and wholesale shipments closely matching retail demand. The company expects free cash flow in excess of $350 million, despite more than $100 million of cash outflows tied to variable compensation earned in 2025. Incremental tariff headwinds are projected at $35 million to $45 million, net of mitigation actions. For Q1, Brunswick anticipates adjusted EPS of $0.35 to $0.45, reflecting front-loaded tariff costs and early-year product investments.