RV Downturn Drags On: Winnebago Issues Profit Warning

Winnebago Industries has issued a profit warning due to weakening RV market demand and increased macroeconomic headwinds. The company forecasted net revenue of $775 million for the third quarter, falling short of the Bloomberg consensus estimate of $810.4 million. Adjusted earnings per share are expected to be in the range of $0.75 to $0.85, significantly lower than analysts' expectation of $1.37. The company's CEO attributed the decline to growing macroeconomic uncertainty, worsening consumer sentiment, and a cautious dealer network. Analysts noted that the challenges facing Winnebago are indicative of broader headwinds in the RV industry, which has been in a slump since interest rates increased in 2022. The RV market experienced a boom during the zero-interest-rate environment, but quickly unraveled once rates began to rise. The RV downturn is expected to end when interest rates go back down. The company's announcement will likely amplify questions about the motorized market and whether larger strategic actions need to be taken. The RV industry has been experiencing a downturn, and camper stocks and retail shops have been in a slump since rates increased.