Winnebago Industries has adjusted its full-year earnings outlook amid a surprising fiscal first-quarter loss attributed to subdued consumer demand and a cautious dealer network. The outdoor lifestyle product manufacturer now anticipates adjusted earnings in the range of $3.10 to $4.40 per share for fiscal 2025, slightly down from its previous projection of $3 to $4.50.
The current consensus among analysts on FactSet stands at a non-GAAP EPS of $3.38. In Friday's trading, the stock dipped 1.7%. "Although the first half of the fiscal year comes with its typical seasonality and challenging market conditions, we are prepared to capitalize on the anticipated rise in demand as the recreational vehicle and marine markets enter the spring selling season," commented Chief Executive Michael Happe.
The company continues to forecast revenue between $2.9 billion to $3.2 billion, in line with the Street's expectation of approximately $2.99 billion. For the quarter ending in November, Winnebago reported an adjusted loss of $0.03 per share, a stark contrast to earnings of $0.95 from the previous year, significantly missing the Street's expectation of $0.20 EPS.
Revenue saw a decline of 18%, totaling $625.6 million and falling short of analysts' estimates of $672.2 million, mainly due to lower unit volume and an average selling price reduction associated with the product mix. The RV and marine operating environment faced continuing challenges in the first quarter, characterized by reduced consumer demand and a hesitant dealer network reluctant to commit to new orders with the winter season approaching, noted Happe.
Sales within the towable RV division dropped by 23%, amounting to $254 million, while the motorhome RV sector decreased by 19%, generating $271.7 million. Both segments suffered from diminished volumes, as reported by Winnebago. Conversely, revenue from marine operations showed improvement, rising to $90.5 million from $87.3 million in the same quarter last year, driven by price increases and higher unit volume.
Although revenue and margins in the RV segments decreased year over year, Happe expressed satisfaction with the marine segment's performance, highlighting both top-line and margin growth sequentially and year-over-year. The company anticipates continued challenges in its second quarter but remains optimistic about its long-term growth potential.
"From an industry perspective, encouraging retail trends in October, alongside increasing consumer confidence and ongoing inventory management efforts at the dealer level, represent positive indicators of strengthening demand and a more balanced market environment," added the CEO..