Acushnet (GOLF) 2026财年第三季度业绩电话会：Titleist增长与最新业绩指引

阿舒奈特控股公司（Acushnet Holdings Corp.，NYSE: GOLF）公布了稳健的2026财年第三季度业绩。Titleist高尔夫装备业务保持良好增长动能，但被FootJoy及高尔夫配件（Golf Gear）销售下滑所抵消。管理层维持了全年营收预期，并将调整后EBITDA指引更新为4.55亿至4.70亿美元。

业绩要点

• 第三季度净销售额为6.49亿美元，按固定汇率计算同比下降1%。调整后EBITDA下降3%至1.15亿美元。
• 前九个月净销售额按固定汇率计算增长6%至22.2亿美元，而调整后EBITDA增长17%至4.68亿美元。扣除关税净退税影响后，调整后EBITDA增长8%。
• 在高尔夫球需求以及GTS金属木杆发售的推动下，Titleist高尔夫装备销售额在第三季度增长1%，今年迄今增长10%。
• 第三季度毛利率扩大110个基点至49.6%，反映出FootJoy盈利能力的改善以及鞋类产品销量的提升。
• 管理层继续预计2026年净销售额为26.5亿至26.75亿美元，目前预计调整后EBITDA为4.55亿至4.70亿美元，其中包括约3000万美元的关税净退税收益。
• 公司正在为2027年推出Pro V1以及全新铁杆和推杆做准备，同时继续投资于研发、量身定制网络、技术以及Titleist Performance Institute平台。

关键财务数据

存货同比增加6000万美元，因阿舒奈特在为2027年的产品发布做准备。截至9月，公司通过4500万美元的股息和8100万美元的股票回购，累计向股东回报约1.27亿美元。

业务与经营业绩

Titleist高尔夫装备仍是阿舒奈特的主要增长引擎。该业务部门销售额在第三季度增长1%，今年迄今增长10%。各地区的高尔夫球需求表现稳健，尽管2026年并非Pro V1新品发布年份，但在Pro V1销量增长的带动下仍实现了强劲表现。

Titleist高尔夫球杆受益于第二季度提前发售的GTS发球木杆和球道木杆，以及Vokey挖起杆和Scotty Cameron推杆的良好势头。管理层表示，GTS在专业选手和高影响力球手方面的出货量、零售动销率和采用率表现优异，足以促使其考虑提前未来铁杆产品的发布时间。

高尔夫配件营收在第三季度下降9%，但今年迄今仍增长2%。管理层将季度下滑的部分原因归咎于第四季度新的Titleist高尔夫球包和Club Glove产品发布前的发货时程安排。

FootJoy销售额在第三季度下降7%，前九个月下降2%。然而，管理层指出，平均售价提升、毛利率扩大以及尾货鞋类清仓销售处于历史低位，均表明该业务部门的盈利能力正在改善。

鞋类业务在第三季度增长超过30%，在美国以及欧洲、中东和非洲地区（EMEA）均实现强劲增长。

按地理区域划分，美国市场销售额在第三季度下降1%，但今年迄今增长6%。EMEA在第三季度增长5%，今年迄今增长8%；日本市场在第三季度略有上升，前九个月增长11%。韩国市场在第三季度下降3%，今年迄今基本持平。世界其他地区销售额在第三季度下降2%，但今年迄今增长8%。

管理层业绩指引

阿舒奈特继续预计2026全财年净销售额为26.5亿至26.75亿美元，中点处代表约4.1%的增长。按固定汇率计算，管理层预计增长率为3.3%-4.2%。

全年调整后EBITDA目前预计为4.55亿至4.70亿美元。这其中包括约3000万美元的关税净退税收益。

按中点计算，该指引意味着第四季度净销售额约为4.40亿美元，调整后EBITDA亏损约500万美元。管理层将预期亏损归因于正常季节性因素、GTS发售提前、向2027版Pro V1的产品过渡以及持续的战略投资。

公司仍预计全年自由现金流将得到显著改善，相当于调整后EBITDA的约40%-50%。全年资本支出预计约为9500万美元。

风险与关注领域

• 由于2027版Pro V1的生产过渡，以及GTS销售与收益提前转移至第二季度，预计第四季度Titleist高尔夫装备销售额将有所下降。
• 阿舒奈特正面临钨、石油基高尔夫球原材料、劳动力、医疗保健和员工福利成本上升的问题。
• 北美地区ERP系统的上线导致定制刺绣业务受到临时性干扰，对FootJoy和高尔夫配件业务造成影响。
• 第三季度部分时间的恶劣天气减少了打球时长，导致下球场打球轮次及消费者需求出现波动。
• 在这些大型市场出现疲软后，管理层对日本和韩国的服装需求保持谨慎态度。
• 由于2027年计划推出的铁杆和推杆产品接续的是包含了金属木杆和挖起杆发售的2026财年，因此预计2027财年的球杆业务增长态势将不及2026财年有利。

分析师问答环节亮点

管理层表示，资深高尔夫球手并未显著延长装备换代周期。消耗品业务保持韧性，而高尔夫球杆业务在2026财年实现了两位数的增长率。

关于2027年的毛利率，管理层表示其目标是保持或扩大毛利率水平。虽然原材料、劳动力和福利成本有所上升，但被认为是可控的，而产品层面的定价决策尚未最终确定。

阿舒奈特认为，竞争对手向两年期球杆发布周期的转变有助于形成一个更加理性的市场，减少上一代折扣产品的数量。管理层还预计这一趋势将提升量身定制（custom fitting）的重要性，而这正是公司认为的自身核心优势所在。

日本仍是管理层最大的国际市场份额增长机遇所在。公司计划扩大当地的量身定制能力，同时巩固高尔夫球和球杆业务的增长势头。在韩国，管理层打算对服装业务继续保持谨慎，同时继续支持装备业务的增长。

业绩电话会议完整文字记录

完整财报电话会议逐字稿

管理层陈述

Operator

Hello, everyone. Thank you for joining us, and welcome to the Acushnet Company 3Q '26 Earnings Call. [Operator Instructions]

I will now hand the conference over to Cameron Vollmuth, Director of Investor Relations. Please go ahead.

Cameron Vollmuth

Good morning, everyone. Thank you for joining us today for Acushnet Holdings Corp.'s Third Quarter 2026 Earnings Conference Call. Joining me this morning are David Maher, our President and Chief Executive Officer, and Sean Sullivan, our Chief Financial Officer.

Before turning the call over to David, I would like to remind everyone that we will make forward-looking statements on the call today. These forward-looking statements are based on Acushnet's current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from these expectations. For a list of factors that could cause actual results to differ, please see today's press release, the slides that accompany our presentation and our filings with the U.S. Securities and Exchange Commission.

Throughout this discussion, we will make reference to non-GAAP financial measures, including items such as net sales on a constant currency basis and adjusted EBITDA. Explanations of how and why we use these measures and reconciliations of these items to the most directly comparable GAAP measures can be found in the schedules in today's press release, the slides that accompany this presentation and in our filings with the U.S. Securities and Exchange Commission.

Please also note that references throughout this presentation to year-on-year net sales increases and decreases are on a constant currency basis, unless otherwise stated, as we feel this measurement best provides context as to the performance and trends of our business. And when referring to year-to-date results or comparisons, we are referring to the 9-month period ended September 30, 2026, and the comparable 9-month period in 2025.

With that, I'll turn the call over to David.

David Maher

Thanks, Cameron, and good morning, everyone. As always, we appreciate your interest in the Acushnet Company. I am pleased to report on a solid third quarter for Acushnet, led by strength and momentum across our Titleist Golf Equipment segment. With many golf regions winding down their playing seasons, the golf industry is structurally healthy. This week as Acushnet celebrates 10 years as a publicly traded company, it is noteworthy how vastly improved golf industry fundamentals are today as compared to a decade ago.

There are many data points which frame recent industry growth with the most compelling being 8 consecutive years of participation increases, affirming the game's enduring appeal and the meaningfully improved financial health of golf courses and golf retailers, which has led to outsized investment in facilities to meet the future needs of an evolving golfer base.

Acushnet's headlines remain growth and strength in our core Titleist Golf Equipment segment, improving profitability within FootJoy and the durability of our golf gear franchise. On top of this, there are call-outs related to the timing of our golf club business in 2026, which we will address. Overall, we are pleased with the strength of our brands, the company's healthy balance sheet and Acushnet's clear future direction as we prepare for a full slate of product launches and new initiatives scheduled for 2027.

Now moving to our third quarter and year-to-date results on Slide 4. For the quarter, Acushnet delivered worldwide net sales of $649 million, a 1% constant currency decrease from last year, driven by continued strength in Titleist Golf Equipment and healthy demand in golf balls, offset by lower sales in FootJoy and Golf Gear. Adjusted EBITDA of $115 million was down 3% in the quarter. Year-to-date, net sales of $2.22 billion were up 6% in constant currency and adjusted EBITDA of $468 million was up 17% year-over-year. Excluding the net tariff refund impacts, adjusted EBITDA is up 8% year-to-date.

Getting to our segment results, you see the continued global momentum of Titleist Golf Equipment, which was up 1% in the quarter and 10% year-to-date. We are pleased with strong demand across the Titleist golf ball lineup, which has grown in all regions led by Pro V1 which has posted volume gains in 2026 on top of last year's record launch.

Titleist Golf Clubs also remain vibrant on the strength of new GTS metals, which have benefited from their Q2 launch timing and momentum in Vokey wedges and Scotty Cameron putters. Golf Gear revenues were down 9% in the quarter and are up 2% year-to-date, led by growth in EMEA, Rest of World and the U.S. This third quarter decline is partly timing related as we prepare for launches of new Titleist golf bag and Club Glove product offerings in Q4.

And our FootJoy business was down 7% in the quarter and 2% year-to-date. As previously noted, we are focused on and making good progress towards strengthening FootJoy's underlying profitability. FJ's performance-oriented and premium product assortment is generating positive trending ASPs, expanded margins and historically low levels of closeout footwear sales, all of which are delivering improved year-on-year profitability in the segment. And lastly, our shoes business continues to build positive momentum, growing more than 30% in the quarter with strong gains in EMEA and the U.S.

Now looking at the quarter by region on Slide 5, you see the U.S. market was down 1%, driven by lower net sales in FootJoy and Golf Gear, while the Titleist Golf Equipment segment continued to grow in the U.S. Year-to-date, the U.S. was up 6%. EMEA was up 5% in the quarter, reflecting gains in Titleist Golf Equipment and Golf Gear. And through the first 9 months, EMEA is up 8% on a constant currency basis. Japan was slightly up in the quarter with gains across all reportable segments and is up 11% year-to-date.

Korea was down 3% in the quarter, driven by lower sales in FootJoy and Golf Gear. And year-to-date, Korea is about flat with healthy gains from Titleist equipment. And Rest of World was down 2% versus last year's third quarter across all reportable segments and is up 8% year-to-date.

In summary, we are pleased with Acushnet's performance, the health of the golf consumer and the direction of the company. Product lines are in great shape. Inventory positions, both owned and at retail, are in line for this time of the year, and we are enthused about our new product pipelines as we prepare for 2027.

Q4, as is often the case, will be a period of transition as we convert Pro V1 production to next-generation product and make key investments in R&D, fitting networks and our TPI performance platform to drive future growth.

Thanks for your attention this morning. I will now pass the call over to Sean.

Sean Sullivan

Thank you, David. Good morning, everyone. As highlighted, we had a solid third quarter and year-to-date performance, driven by continued momentum in Titleist Golf Equipment with healthy demand for golf balls and the success of our new GTS drivers and fairways. Third quarter net sales were $649 million and adjusted EBITDA was $115 million, down $4 million from last year's third quarter. These results were in line with our expectations following the accelerated launch of our GTS metal woods into the second quarter.

For the first 9 months of 2026, net sales increased 6% and adjusted EBITDA increased 17%, which includes an approximately $34 million benefit from net tariff refunds. Excluding that benefit, adjusted EBITDA increased 8% year-to-date. Third quarter gross profit of $322 million was up $3 million compared to last year, driven by improved profitability in FootJoy and higher sales volumes at shoes, partially offset by higher product costs in Titleist Golf Equipment.

Third quarter gross margin of 49.6% was up 110 basis points, while year-to-date gross margin was 50.5%, up 190 basis points versus prior year. On a normalized basis, year-to-date gross margin was 48.6%, flat year-over-year despite an approximately $29 million headwind from higher tariff expense.

SG&A expense of $217 million in the quarter increased $12 million from 2025, primarily due to higher IT-related expenses associated with our ERP implementation project and higher incentive compensation expense. With respect to the ERP implementation project, I am pleased to report that the company went live in the third quarter in North America and at our golf ball manufacturing operations in Thailand. While the system cutover proceeded smoothly, we experienced some temporary disruption in our custom embroidery operations, which impacted FootJoy and Golf Gear. From here, we will continue to advance the ERP implementation in phases across our remaining geographic regions.

Interest expense of $12 million in the quarter was down $3 million due to a decrease in interest rates. Our effective tax rate in Q3 was 25.5%, down from 37.3% last year, primarily driven by changes in our jurisdictional mix of earnings and a reduced income tax benefit related to the U.S. deduction of foreign-derived intangible income.

Moving to our balance sheet and cash flow highlights. Our strong balance sheet and cash flow position us well to continue executing our capital allocation strategy with a focus on investing for long-term growth while returning capital to shareholders. Our net leverage ratio at the end of Q3 using average trailing net debt was 1.9x, down sequentially. Inventories were up $60 million versus last year, and we remain comfortable with this position ahead of new product launches in 2027.

Year-to-date cash flow from operations of $319 million increased $124 million from the first 9 months of 2025, driven in part by tariff refunds received in the second quarter and a reduction in working capital requirements. Capital expenditures were $57 million in the first 9 months of 2026, reflecting our continued strategic investments in additional golf ball manufacturing capacity and increased club assembly to support the sustained demand of our products globally. We still expect full year 2026 CapEx spend to be approximately $95 million.

Through September, we returned roughly $127 million to shareholders with $45 million in cash dividends and $81 million in share repurchases. On October 15, we used $52.5 million to repurchase approximately 584,000 shares of common stock from Magnus in satisfaction of our previously disclosed obligations under our share repurchase agreement. After reflecting the October 15 settlement, we had approximately $107 million remaining under our current share repurchase authorization. Today, our Board of Directors declared a quarterly cash dividend of $0.255 per share payable on December 18 to shareholders of record on December 4, 2026.

Moving to guidance. We continue to expect full year net sales to be in the range of $2.65 billion to $2.675 billion, up approximately 4.1% at the midpoint. On a constant currency basis, we expect net sales to increase between 3.3% and 4.2%. We also now expect full year adjusted EBITDA to be $455 million to $470 million, which includes the full year net tariff refund benefit of approximately $30 million. We still expect full year free cash flow to meaningfully improve year-over-year, converting at roughly 40% to 50% of adjusted EBITDA.

This updated full year outlook reflects the strength of our year-to-date performance and our expectations for the fourth quarter. At the midpoint, the guidance implies fourth quarter net sales of approximately $440 million and an adjusted EBITDA loss of approximately $5 million. This is consistent with our seasonally lower fourth quarter earnings profile and reflects the timing of expected lower sales in Titleist Golf Equipment, including the impact of accelerating our metals launch into the second quarter, which shifted sales and earnings earlier in the year as well as the transition to the 2027 Pro V1 launch. During the fourth quarter, we also plan to continue our strategic investments in technology and fitting as well as preparing for our product launches in 2027.

Overall, we're very pleased with the performance of the business heading into the fourth quarter. The team remains focused on finishing the year strong, supporting dedicated golfers around the world and investing in our long-term strategic priorities.

With that, I will now turn the call over to Cameron for Q&A.

Cameron Vollmuth

Thanks, Sean. Ben, could we now open up the line for questions?

Operator

[Operator Instructions] Your first question from the line of Joe Altobello of Raymond James.

分析师问答

Mitchell Ingles

This is Mitchell Ingles on for Joe Altobello. To start, can you help us bridge the 2027? I'm assuming you're going to back out the $30 million IEEPA refunds, but there will probably be some SG&A spending going away as well. And on the other hand, you have raw material and freight pressure. So can you help us think about the puts and takes?

Sean Sullivan

Yes, Mitchell, happy to do that in some broad strokes. So you have it right. At the end of this year, we will have a net benefit of $30 million due to the tariff refund. So we need to normalize that as we go into next year. From an input raw material cost of sales perspective, obviously, we've got incremental costs related to some of our input costs, both in terms of golf balls and golf clubs due to the materials we use in those products. We've got to keep an eye on labor, keep an eye on health and welfare costs, which are obviously increasing certainly in the U.S. and North America.

As we look at SG&A, I don't -- we'll continue the IT and the technology investment, the investment in A&P to support product launches and our whole technology road map. So I don't know that there is anything specific to call out SG&A year-over-year if you're already normalizing for the tariff refunds and the AIP or the incentive comp impact related to that. So those are the broad strokes.

As David said, we're excited about the '27 Pro V1 launch. In the club category, we've got irons and we have putters coming, which certainly will not be as strong of a growth profile as we'll see here in '26 due to the metals and the wedge launch, given that it's an odd number year. So broadly speaking, that's how we're -- how '27 sets up as we sit here today.

Mitchell Ingles

Great. That's helpful. And then as a follow-up, can you give an update on the GTS launch? How is demand tracked versus your expectations? And what you're seeing in terms of sell-through and custom fitting?

David Maher

Yes, Mitchell, we're really pleased with the launch on a variety of levels, starting with tour adoption and adoption across the pyramid of influence. As you know, we went early. We -- the team did a nice job getting our fitting tools out in the second quarter, and I think we went live in June. So as we sit here today in November, we're very pleased with, a, the product; and b, the decision to go early, both in terms of sell-through and our shipments into the market. So I think as we indicated on prior calls, this idea of moving launches earlier in the year, the first example being GTS has been a real positive experience. So we're real pleased with GTS, and we're thinking along those same lines for irons.

Operator

Your next question from the line of Simeon Gutman of Morgan Stanley.

Simeon Gutman

First, a short-term question. Rounds played, it looks a little, I don't know, choppy volatile week, at least coming into September. We haven't seen October yet. Normal noise, the health of the consumer, health of the game, where does it stand right now?

David Maher

Yes. Simeon, I think you summed it up. It was a bit of a choppy quarter. And if you look at golf playable hours, it would show that golf playable hours were down, I think, 6%, 8% in the key third quarter months. Rounds of play weren't down quite that much. So the way we think about it and really U.S. commentary first, net rounds are still tracking ahead for the year. We got through periods in the third quarter of heavy rains, heavy heat.

The latest we saw for October was that golf playable hours were about flat. But net-net, I think we're coming off a 6-, 7-year run of increases, maybe more like 5-, 6-year run of rounds played increases. 2026 still tracking at or maybe slightly above last year despite some choppy weather. But -- and we saw it in our business. When weather was good, people were playing, we'd see upticks; weather was poor, we saw rounds declines and some downticks. But I think you summed it up well. It was a bit choppy.

As we look around the world, similar profile. If we've got U.S. rounds up slightly, we've got Rest of World rounds down slightly, but it's a mixed bag. They're up in Korea. They're up in Australia and New Zealand. They're up in China, but they're down in some other markets, all in the low single-digit ranges. And again, I think it's as much commentary on weather. But as we step back from that, we still -- we're enthused about the games underlying demand. And again, I think that's reflected in our performance. That's reflected in the overall rounds of play trends, and we do accept that you're just going to see some weather swings like we saw in the third quarter.

Simeon Gutman

Got it. And my follow-up is how do you -- how are you looking at replacement cycles? Are they elongating? And are there differences in uptake from green grass versus some of the big box stores?

David Maher

Yes. We've said previously that when things slow down in the economy, we would expect consumables to hold up quite well and durables to maybe see some elongated product life cycles. We have not seen that at this stage, and it leads me to comment on the resilience and durability of our dedicated golfer, right? They're playing, they're avid, they're active. They're taking lessons. They're spending on performance equipment.

So -- and the other point I would make is we've counter to if there's an elongated life cycle purchase cycle, we're going a little bit the other way in part by us entering the second quarter, which was a really good move for our club business. And again, as I noted earlier, we think that's a trend you'll see play out over the next couple of years with iron launches. So I haven't seen anything yet. Consumables is in very good shape. And obviously, our results, our club business this year, up double digits, suggest that our golfer is staying with their pre-existing conversion cycles.

Operator

Your next question from the line of Gregory Miller of Truist Securities.

Gregory Miller

First question I'd like to ask you is about green fees. They are rising. And I'm curious if you're seeing any impact to rounds played or sport interest as a result.

David Maher

Yes, that's a great question. We talk about it often because it's a surprising number, and we point to data from the NGF average cost of a round and they normalize based on an average of peak and off-peak times. This is public golf average cost of a round is $47. It's up 4% versus last year, and it's up 29% versus, I guess, 6, 7 years ago. So there is affordable golf out there. But on the other side of it, we all know in major markets, big cities, it's maybe a little bit of a different story.

So when we look at rounds of play data, public, private, there doesn't seem to be a skewing or a backlash to pricing. The biggest influencer as we've seen this year and talked about earlier has been weather. So it is and will and should always be a watch out for the industry. But at the moment, we have not seen pushback. Again, the pushback on rounds has been largely weather. And it is a surprising stat for a lot of people to -- when they hear that the average cost of a round is $47.

Gregory Miller

And I do look at the national data from the U.S. as well, but I don't -- I frankly don't have as much color of what's going on internationally in terms of green fees. And wondering if you could also speak to that as well.

David Maher

Yes. Generally speaking, it's a little bit like the U.S. in that it depends. Big cities, you're going to see higher costs. Seoul, Tokyo, Japan, Korea, the cost of play is higher, always has been. Across Europe, you've got really 2 versions. You've got local play and you've got tourism play. Tourism play cost of those rounds have spiked, but local play has been more normalized. So it's a similar watch out, but we have not seen it reach a level where it's prompting folks to not play or play less golf.

Operator

Your next question from the line of Matthew Boss of JPMorgan.

Matthew Boss

So David, any recent change in buying behavior that you've seen from customers in the U.S. versus overseas? And could you just walk through puts and takes on fourth quarter revenues or any change relative to your initial plan? And last, just if we're taking a step back, how do you feel about your product and innovation pipeline into '27 at this point?

David Maher

Okay, Matt. Maybe Sean and I will tackle that one together. But I'll start with what we've seen from the consumer. Any time you have weather and rounds declines, you're going to see some dips. We saw that. The quarter best described as a bit choppy. But a lot of upticks within that choppiness when weather was decent.

So our consumer -- and again, it's this dedicated golfer, they're avid. They're resilient. They're passionate. They are alive and well, not to say that all of them are unaffected by whether it's interest rates or gas prices. But by and large, the first thing we're going to point to is rounds of play, and that speaks to their avidity and their commitment to the game and then what flows from that is their spending. So I would say steady state over the last several months with ups and downs as much weather related.

And I'm not sure I have any meaningful callouts outside the U.S. that would counter that. So again, it really -- it speaks to this sustainability and durability of Acushnet's core consumer. We're very sensitive to it. We're very aware of it. We understand what's happening broadly with inflation and watch carefully and closely as to what that might do to consumers and their interest in our products.

But at the moment, as we really enter -- we're in a shoulder season, we're soon to enter the snowbelt season where a lot of our play really comes from a handful of open Sunbelt markets. We're pleased with the state of our consumer and the durability of our consumer.

Sean is going to hit part 2.

Sean Sullivan

Yes, Matt. Just on Q4 and just stepping back the full year, I think it's playing out largely as we had expected. I think, again, strong year from golf equipment, strong performance in golf balls in a non-Pro V1 launch year. So when we think about Q4 for Titleist Golf Equipment, we're obviously expecting to be down given the transition to Pro V1 2027. Obviously, with the accelerated club launch, we're going to see a year-over-year decline in golf clubs.

From a FootJoy perspective, the -- as David said, the profit focus in FootJoy is intact, and you'll see that in the Q in the full year. In terms of the profitability portrait in golf gear, third quarter soft, but just timing. So overall, I think the full year will have a nice outcome there. So -- and I called out in my script. I think if not for some of the disruption to FootJoy and golf gear on the custom side, I think the sales -- due to the ERP implementation, I think the sales profile for the year is largely in line with our expectations. So very pleased with that.

David Maher

Yes. Matt, I'll wrap it up with commentary on our pipeline. And I'll begin with, as we both stated, the inventory in -- at retail and in our facilities is in really good shape. So we like our state of readiness for the holidays. And behind that, we like our steady state of readiness for new product launches. It's Pro V1 year. So that's a boost to the ball business. We've got some exciting things happening in irons and putters. So we're enthused there. We've got some good momentum happening in footwear and gear.

And apparel, we're just cautious about -- we're always cautious about largely, that's an Asia comment. We've seen softness over the last couple of years in Korea and Japan and not that we expect that to persist a whole lot longer, but we're just conservative about those very large apparel markets.

So real pleased with the state of our innovation pipeline. We got some exciting things happening at TPI in terms of that side of the business. So overall, we're investing. And as Sean talked about, part of our Q4 guide implies that we're going to continue to make some investments. I called it out. It's in R&D. It's in our fitting networks, it's in TPI. And that's really to drive future growth. So we are right where we want to be at this time of year and feel really good about what's to come in 2027.

Matthew Boss

Sean, just as a follow-up to that, on the drivers of gross margin expansion that you saw this year, any change or considerations we should think about for next year gross margin as we think or start to size up input costs, freight and pricing power?

Sean Sullivan

Yes. Again, a little early, Matt, to talk overall. But clearly, we're pleased that we're on a trajectory for '26 to -- on a normalized basis, excluding tariff -- the net tariff impact that we're going to see gross margin expansion. So slightly better. I talked about it in my comments about FootJoy and some other aspects driving that. And I think in one of the earlier questions, we haven't finalized the pricing grid for every product and every launch next year. So I'll leave that to the side.

But from a cost of goods sold perspective, I think tariff, unless there's a change, I would expect that to be effectively flat year-over-year. We certainly are seeing rising input costs in tungsten and some of the oil-based input costs to balls and the manufacturing of balls, health and welfare, labor, et cetera. So again, the goal here is to meet or expand the gross margin profile. There are certainly headwinds. Like I said, we haven't finalized the pricing decisions across every product launch for next year.

So overall, I think those are the things. I think they're all manageable, Matt, and we'll have more to say certainly in February on the call.

Operator

Your next question from the line of Jeff Lick of Stephens.

Tom Wendler

This is Tom Wendler on for Jeff Lick at Stephens. Congrats on a nice quarter. First question from us, as more competitors move towards the 2-year product launch cycle, how do you think that changed the overall golf club market? And what does that mean for your positioning?

David Maher

Yes. So we're certainly aware that our competitors are moving in a 2-year direction, we think is prudent. We've been there a long time and continue to stay there. What I think it means longer term is it invites a healthier marketplace. You're going to have less periods of discounted prior generation product in the market and you're going to have more periods where it's principally about performance rather than generation new versus generation old. So high level, see it as a step towards an even more rational golf marketplace. And if we go back 10 years, it was going the other direction. Product life cycles were less than a year, and it was very murky and complicated and messy.

So I think it results in a cleaner marketplace. I think it ultimately benefits Acushnet over the long term. And I think the final piece of that is it's going to really force and require a commitment to fitting, which is one of our core strengths. So high level, that's how we think about it.

Tom Wendler

Awesome. And then just following up on the fitting comments. You invested fitting over the last few years. Are you seeing those investments change how often golfers are buying equipment or the type of products that they are buying? And how important is fitting becoming in the overall golf club market?

David Maher

Yes. So we jumped into fitting in the early '90s, and we've been public for 10 years. But since the early '90s, we've been talking about building out and expanding our fitting network. And whether it's in the U.S. or whether it's globally, it's that important to our business. We believe the for golfers to get the very best out of Titleist equipment. They need to be fit. So it's really a core strategy of ours. It applies principally to clubs and balls. We started talking a year or 2 ago about FitLab and a fitting process for footwear.

So yes, it's a core -- it's a core strategy of the company. And at the heart of it is, we believe great product plus a great fitting is going to help golfers play their very best. And we also believe for our target consumer, you need both. So a key, key part of our business for a long, long time, and I expect for years to come, you'll continue to hear us talking about investing, strengthening, building out and growing our fitting capabilities.

Operator

Your next question from the line of Noah Zatzkin of KeyBanc Capital Markets.

Noah Zatzkin

When I look at geographic constant currency performance year-to-date, relatively stronger performance in Japan and Korea. So maybe if you could just provide kind of a quick update on those markets and how you think about the share opportunity looking ahead internationally.

David Maher

Yes. Noah, I'll do a quick flyover of Japan and Korea. But really pleased with our team's performance this year. I think we're up double digit, up 11%, really led by balls and clubs. Footwear and gloves are in pretty good shape in Japan as well. Apparel has been soft. I think I've talked about that. Rounds of maybe down slightly, but I think about rounds as being ballpark flat. So very pleased with our momentum. And as I've said on prior calls, we see Japan as our biggest market share gain growth opportunity, and that's as much commentary on where we are and the competitiveness of the market. And also back to my earlier comments, it's the least evolved of our fitting markets. So one of our unlocks in Japan will be to continue to activate and expand our fitting capabilities. But nice year in Japan.

Korea, rounds of play are up a little bit versus last year. We feel really good about that as just an overall sign of market health. Our business down slightly, and that warrants a comment. Nice growth in Titleist Equipment, balls and clubs, and that's a theme we've talked about across regions. Balls and clubs are having a good year in every region.

Similar to Japan, footwear and gloves are in good shape. If there's softness, it's apparel and the apparel market in Korea is really outsized. It's a very, very large marketplace. We think it's after a couple of year period of correction, it's largely stabilizing. But as we think about the future, I feel really good about our business in Korea. We're going to take a cautious view towards apparel and keep fueling our ball and club momentum.

Noah Zatzkin

Very helpful. And then maybe just a housekeeping question. I think net tariff refunds were a $38 million benefit through second quarter, and I think the benefit sits at $33.8 million as of the end of 3Q. So is the delta there in timing of incentive comp hitting in 3Q? Or am I thinking about that wrong?

Sean Sullivan

No, you're thinking about it right, and we'll have another one in Q4, right, as we true up the net $30 million.

David Maher

Thanks, everyone. As always, we appreciate your interest in the company, and wish you all a great holiday season and look forward to reporting back when we're on our February call. Thanks again.

Operator

This concludes today's call. Thank you for attending. You may now disconnect.