This week, the stock of Topgolf Callaway experienced a downturn.

Over the recent days, investors have mainly kept their distance from the shares of Topgolf Callaway Brands (MODG, -0.12%). As revealed by data gathered by S&P Global Market Intelligence, as of the previous Thursday, the company's stock had dropped by approximately 13% within the week. The reason behind this decline was the disappointing quarter for the company.

A Subpar Round

Topgolf published its third-quarters results shortly after market close on Tuesday. For the period, revenue hit slightly over $1.01 billion, which was a decrease of 3% compared to the previous year. However, it surpassed the management's expectations as well as the consensus analyst estimate, according to data from Zack's.

This trend was more visible in the profit and loss section, where Topgolf suffered a significant 88% decrease in adjusted net income. This came to $4.3 million ($0.02 per share), in stark contrast to the nearly $36 million profit of the previous quarter. Despite this, it still managed to surpass the average analyst's prediction of an adjusted loss of $0.18 per share.

Topgolf was most affected by a 11.1% decrease in revenue from its active lifestyle segment, which amounted to $266 million for the quarter. Out of the three segments, only the Topgolf network of golf practice venues with video enhancement saw a growth, but it was a mere 1% increase to $453 million.

Adjustments to the Scorecard

Management reduced its full-year revenue prediction to $4.2 billion, the very lowest point of its initially anticipated range of $4.2 billion to $4.26 billion. Regarding adjusted earnings per share, expectations were also lowered to a range of $0.08 to $0.13, compared to the previous range of $0.11 to $0.21.

Following Topgolf's underwhelming performance and modified guidance, several analysts adjusted their stock price targets. Among these was influential investment bank Goldman Sachs, whose analyst Kate McShane lowered her share price target to $12 from her previous $14. She maintained her 'neutral' recommendation during this process.

Although Topgolf venues are enjoyable places to spend time, golf isn't currently a popular trend. The company could potentially benefit from a surge in golf's popularity, but I don't foresee that happening anytime soon.

In light of Topgolf's less than stellar third-quarter performance and modified guidance, investors might be hesitant to allocate more money towards finance in this company. As a result, some analysts, such as Kate McShane from Goldman Sachs, have adjusted their investing strategies and lowered their share price targets for Topgolf Callaway Brands.