Malibu Boats Net Sales Jump 30% in Q4

Key Points

• Net sales (GAAP) jumped 30.4% to $207.0 million in Q4 FY2025, driven by a sharp rebound in unit volumes and pricing.

• Adjusted earnings per share (non-GAAP) turned positive at $0.42, compared to a $(0.40) loss in Q4 FY2025, though this missed expectations.

• Management issued a cautious outlook for fiscal 2026, guiding for flat to declining net sales and lower margins.

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Malibu Boats (NASDAQ:MBUU), a leader in performance sport boats and premium recreational watercraft, reported its fourth quarter and fiscal year 2025 earnings on Aug. 28, 2025. The most notable news was a significant rebound in GAAP sales, profitability, and margins, highlighted by a 30.4% GAAP revenue increase and a swing to positive net income (GAAP). These results surpassed management’s prior expectations. However, the company’s outlook for FY2026 remains subdued, with forecasts for net sales to be flat to down mid single digits amid continued industry headwinds. The overall quarter showed a strong operational snapback, especially as dealer inventory normalized and pricing improved.

Business overview and areas of focus

Malibu Boats designs, manufactures, and markets performance sport boats, outboard fishing boats, and luxury sterndrives under its core brands: Malibu, Axis, Pursuit, Maverick, Cobia, Pathfinder, Hewes, and Cobalt. These boats serve customers looking for water sports, fishing, and high-end cruising experiences. Core success factors include market leadership in premium sport boats, a broad brand portfolio to attract different customer segments, and a well-developed dealer network with more than 400 locations.

The company’s recent strategic priorities focus on broadening its addressable market with both high-performance and entry-level boat offerings. Innovation remains central, with new models and proprietary features like the Monsoon engine and Surf Gate technology drawing new and returning buyers. Effective dealer management and vertical integration—like in-house engine and trailer production—support operational control and pricing flexibility. Acquisitions in recent years have helped expand its footprint, though recent softness in acquired segments has affected performance.

Quarterly performance: Financial and operational trends

Q4 FY2025 results marked a sharp turnaround for Malibu Boats, with net sales (GAAP) rising 30.4% year over year as unit volumes rebounded, especially for Malibu-branded performance sport boats. Gross profit (GAAP) increased 162.1%, and gross margin (GAAP) expanded by 7.9 percentage points, reflecting improved model mix and pricing. Adjusted EBITDA reached $19.7 million, an improvement from a negative result a year ago. Adjusted earnings per share (non-GAAP) swung from a $(0.40) loss to a $0.42 profit.

Unit volume reached 1,221, up 16.8% from the prior year. The Malibu segment posted the largest gains, with net sales up 114.0% and unit volume up 78.7%. Net sales per unit—a measure that reflects average selling price (ASP)—climbed 11.6% to $169,565, as pricing strength and premium features played a bigger role in sales. Management highlighted that reduced promotional costs and a strong model mix contributed to these improvements. However, not all business segments performed equally: Cobalt and Saltwater Fishing segments experienced declines in unit volumes despite modest net sales growth due to higher ASPs, emphasizing diverging demand trends across product types.

For the full year, performance was mixed. Net sales for fiscal year 2025 decreased 2.6%, and unit volume fell 9.0%, as overall retail demand and dealer order rates remained weak for most of the year. The Malibu segment showed resilience, posting year-over-year sales growth. Cobalt segment faced a double-digit unit decline. Adjusted EBITDA declined to $74.8 million, with the margin narrowing to 9.3 % from 9.9 %—in line with prior guidance, which was reset lower last quarter based on sluggish industry conditions.

On the expense side, Malibu Boats achieved notable progress in controlling costs, as general and administrative expenses (GAAP) dropped to $18.8 million from $21.6 million in Q4 FY2024. This improved operating leverage, with general and administrative costs moving down to 9.1% of net sales. However, For FY2025, general and administrative expenses (GAAP) climbed 21.1% due to legal settlements, higher compensation, and increased incentive costs. Litigation and professional fees remain notable ongoing costs.

Innovation was a chief focus, as the company announced the introduction of 11 new models for model year 2026 across its brand family. These include high-performance Monsoon engine boats and expanded entry-level Axis sport boats—moves intended to capture both premium and first-time buyers. Pricing power was evident, with all product families reporting higher net sales per unit: Malibu segment ASP rose 19.8%, Saltwater Fishing increased 13.2%, and Cobalt gained 21.0%. The ability to drive higher ASPs reflects both product enhancements and inflation-driven price adjustments.

Dealer network health improved as inventory levels normalized during the year. Malibu Boats supported inventory reduction at its dealers, avoiding channel oversupply and lowering promotional expenses. According to management, these efforts enable dealers to enter the next fiscal year with leaner inventories and improved prospects, even as retail demand is not showing strong momentum. The Cobalt and Saltwater Fishing segments remain pressure points, driven by ongoing caution among marine dealers and concentrated market challenges.

Balance sheet metrics remained sound at the end of the fiscal year. Cash stood at $37.0 million, inventory held steady at $142.2 million, and the company reported $18.0 million in long-term debt as of June 30, 2025—newly added in the period but considered manageable given current operations. Share repurchases are expected to slow as management preserves flexibility in a cautious market.

Outlook and what to watch

Management offered a restrained financial outlook for FY2026, projecting net sales to be “flat to down mid single digits” and an adjusted EBITDA margin of 8–9%. No specific quarterly guidance was provided. This outlook signals that Malibu Boats does not expect a near-term recovery in the recreational boating industry, and that unit volumes and margins could face continued headwinds as dealer confidence and consumer demand remain subdued. Legal costs and segment-specific challenges, especially in Cobalt and Saltwater Fishing, are also likely to remain factors in the coming year.

Looking ahead, key areas to monitor include the company’s progress in innovation with its 11 new boat models and the health of its extensive dealer network. With management emphasizing operational discipline and continued investment in new products, investors will be watching for signals of retail demand stabilization and improved dealer order trends in upcoming quarters.

Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.

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