Brunswick Raises 2026 Adjusted EPS Outlook as Q3 Sales Rise 7%

Brunswick Corporation (BC) raised its 2026 adjusted earnings outlook after third-quarter sales increased across every segment and adjusted operating margins widened. The marine products company now expects adjusted earnings per share of approximately $4.65, up 42% from 2025, compared with its previous range of $4.35 to $4.75.

Third-quarter net sales rose 7% to $1.454 billion from $1.360 billion a year earlier. Adjusted diluted EPS increased 63% to $1.58, while adjusted operating earnings climbed to $146.7 million from $106.4 million. Adjusted operating margin expanded 230 basis points to 10.1%, with each segment improving its margin by at least 140 basis points.

On a GAAP basis, operating earnings were $104.0 million, compared with a $242.2 million loss in the prior-year quarter, which included substantial restructuring, exit and impairment charges. GAAP net earnings from continuing operations totaled $65.6 million, versus a $234.3 million loss a year earlier.

Free cash flow increased 26% to $140.4 million from $111.1 million. Brunswick reported $187.3 million of operating cash flow from continuing operations during the quarter and said it had repurchased $75 million of shares year to date.

Growth across all segments

Propulsion sales increased 7% to $570.5 million. Adjusted operating earnings rose 51% to $68.6 million, and adjusted operating margin expanded 350 basis points to 12.0%. Brunswick attributed the improvement to higher production volume, cost-reduction measures and tariff management, partly offset by strategic spending and inflation. U.S. outboard orders were up 11% year to date, while the U.S. outboard pipeline was about 3% lower than a year earlier and 2% lower sequentially.

Engine Parts and Accessories generated $380.9 million in sales, up 5%, marking its highest third-quarter sales since 2020. Adjusted operating earnings increased 14% to $93.6 million, with margin rising 190 basis points to 24.6%. The company cited resilient demand, a richer mix of higher-margin products, prior pricing actions and distribution share gains. U.S. parts and accessories orders increased 12% year to date.

Navico Group sales rose 6% to $197.7 million, supported by growth in electronics, power systems and performance components. Adjusted operating earnings advanced 36% to $12.0 million, while adjusted operating margin increased 140 basis points to 6.1%. Higher sales, operational improvements and prior pricing helped offset material-cost pressure.

Boat segment sales increased 9% to $394.4 million. Adjusted operating earnings doubled to $14.2 million, and adjusted operating margin expanded 160 basis points to 3.6%. Improved product mix, pricing, operating efficiencies and stability at Freedom Boat Club supported the result. Saltwater fishing sales rose 30% and aluminum freshwater sales increased 13%, while recreational fiberglass sales declined 14%.

Brunswick said Freedom Boat Club held 69% of the North American boat-club market, four percentage points higher, and member trips increased more than 3% year to date. The company’s global boat pipeline was approximately 900 units below the prior-year level, including a roughly 700-unit reduction in the U.S.

Full-year outlook and fourth-quarter considerations

Brunswick maintained its 2026 revenue outlook of $5.7 billion to $5.8 billion and expects an adjusted operating margin of approximately 8.0%. The company projects more than $400 million of free cash flow, at least $160 million of debt retirement and more than $80 million of share repurchases. The prior share-repurchase outlook was more than $50 million.

For the full year, Brunswick expects high-single-digit percentage revenue growth in Propulsion, mid-single-digit growth in Engine Parts and Accessories and Navico Group, and mid- to high-single-digit growth in Boat. Its adjusted segment margin outlook calls for an increase of more than 100 basis points in Propulsion, an Engine Parts and Accessories margin of about 20%, an increase of more than 200 basis points at Navico and more than 100 basis points in Boat.

Management identified higher material inflation, disciplined pipeline management in Propulsion and Boat, and uncertain timing for tariff refunds as factors affecting the fourth quarter. Brunswick maintained its estimate of approximately $40 million in net incremental tariff costs for 2026. It recognized about $3 million of gross IEEPA refunds in the third quarter and $33 million year to date, and expects total recognition of $60 million to $70 million, with most of the remaining amount anticipated in 2027.

The company also pointed to geopolitical instability, inflation concerns and pressure on discretionary spending and consumer confidence. Dealers were described as cautiously managing inventory, although Brunswick said most had more than 50% of their credit capacity available and pipelines remained healthy.

For the first nine months of 2026, net sales increased 9% to $4.390 billion and adjusted EPS rose 42% to $3.83. Adjusted operating margin improved to 8.6% from 7.6%. Year-to-date free cash flow declined 15% to $301.1 million, with the company highlighting roughly $100 million of incremental variable compensation reinstatement compared with the prior year.

Brunswick also announced that Aine Denari will become chief executive officer and join the board on January 1, 2027. The company said its strategy, capital-allocation priorities and Investor Day targets remain unchanged.