BRUNSWICK CORP (BC) Business

Item 1. Business

References to "we," "us," "our," the "Company," "Brunswick," and "Brunswick Corporation" refer to Brunswick Corporation and its consolidated subsidiaries unless the context specifically states or implies otherwise.

Brunswick Corporation is a global leader in marine recreation, delivering innovation that transforms experiences on the water and beyond. Our unique, technology-driven solutions are informed and inspired by deep consumer insights and powered by our belief that “Next Never Rests."™ We design, manufacture, and market recreational marine products, including leading marine propulsion products and boats, as well as parts and accessories for the marine and RV markets, and we operate the world's largest boat club. We are dedicated to global industry leadership, to being the best and most trusted partner to our many customers, and to building synergies and ecosystems that enable us to challenge convention and define the future. Incorporated in Delaware on December 31, 1907, Brunswick has traded on the New York Stock Exchange for over 100 years.

Our strategy is focused on:

•Enhancing our unique, cycle resistant portfolio of industry-leading brands across multiple marine categories;

•Understanding and addressing the changing needs and behaviors of global boating participants;

•Investing in innovative, global product leadership and leveraging our leading brands to meet consumer needs;

•Providing customers industry-leading quality and customer support;

•Delivering distinctive, elevated ownership and shared-access experiences that expand boating participation;

•Being the partner of choice to our customers by offering integrated technical and business solutions;

•Engaging consumers with the richest, most intuitive digital experiences;

•Leading the industry in innovative technologies, including artificial intelligence and Autonomy, Connectivity, Electrification, and Shared-Access (ACES) applications;

•Unlocking unique and profound enterprise synergies;

•Investing in increasing global business resiliency through supply chain and operations improvements;

•Being an acknowledged marine industry leader in sustainability; and

•Being an employer of choice through our clear purpose and culture of inclusiveness.

These strategies support our aim to create exceptional experiences, expand participation in recreational boating, deliver industry-transforming technology, and leverage our leading businesses to grow earnings and enhance shareholder value across an array of market conditions. Our integrated business strategy is supported by a balanced capital strategy that includes critical investments in furthering our market leadership position through product and technology innovation, while also managing debt levels and maturities, maintaining strong cash and liquidity positions, and continuing to return capital to shareholders through dividends and moderate share repurchases.

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Key brands associated with each of our segments are listed below.

Refer to Note 5 – Segment Information in the Notes to Consolidated Financial Statements for additional information regarding our segments.

Propulsion Segment

The Propulsion segment, which we believe is a world leader in the manufacturing and sale of recreational marine engines and propulsion systems, had net sales of $2,177.2 million in 2025. The Propulsion segment designs, manufactures, and sells engines, controls, rigging, and propellers globally to over 900 boat builders (both independent and Brunswick's Boat segment) and a network of more than 9,000 marine dealers and distributors, specialty marine retailers, marine service centers, and various local, state, and federal governmental agencies. White River Marine Group, LLC (including Tracker and Ranger Boats) and Brunswick Boat Group are significant customers.

Propulsion segment engines are designed for use in recreational, commercial, and racing applications. Mercury designs and sells four-stroke outboard engine models ranging from 2.5 to 600 horsepower; Mercury Marine and Mercury Racing manufacture gas and diesel inboard and sterndrive engine models ranging from 115 to 1,550 horsepower. Mercury Marine also manufactures two-stroke, non-DFI (direct fuel injection) engines for certain markets outside the United States and Avator™ electric propulsion systems in models ranging from 7.5e to 110e. The Propulsion segment also includes Fliteboard premium electric eFoil systems.

Engine P&A Segment

The Engine Parts & Accessories (Engine P&A) segment had net sales of $1,217.5 million in 2025. Engine P&A sells products such as engine parts and consumables including oils and lubricants, electrical products, boat parts and systems, and also includes our marine parts and accessories distribution businesses.

Engine P&A products are designed for and sold mostly to aftermarket retailers, dealers, distributors, and original equipment manufacturers (OEMs) (including Brunswick Boat segment brands) for both marine and non-marine markets. The Engine P&A distribution businesses are leading distributors of Brunswick and third party marine parts and accessories throughout North America, Europe, and Asia-Pacific, offering same-day or next-day delivery service to a broad array of marine service facilities.

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Navico Group Segment

The Navico Group segment, which had net sales of $800.4 million in 2025, designs, develops, manufactures, and markets products and systems for the recreational and commercial marine, RV, specialty vehicle, mobile, and industrial markets, as well as aftermarket channels. Navico Group creates connected ecosystems encompassing marine electronics, electrification and power components, and digital switching components. Navico Group sells its products to aftermarket distributors and retailers as well as OEMs. White River Marine Group, LLC, Brunswick's Engine P&A distribution businesses, and Brunswick Boat Group are significant customers.

Boat Segment

The Boat segment consists of the Brunswick Boat Group (Boat Group), which manufactures and distributes recreational boats, and the Business Acceleration business. We believe that the Boat segment, which had net sales of $1,525.2 million during 2025, is a world leader in the manufacture and sale of recreational boats. The Boat segment manages Brunswick's boat brands, evaluates and optimizes the Boat segment's boat portfolio and strategy, promotes recreational boating services and activities to enhance the consumer experience and dealer profitability, including through its Business Acceleration initiatives, and speeds the introduction of new technologies into boat manufacturing and design processes.

The Boat segment procures substantially all of its engines from Brunswick's Propulsion segment, and boats typically incorporate a significant volume of parts and accessories supplied by the Engine P&A and Navico Group segments. The Boat Group sells its products through a global network of more than 1,300 dealers and distributors, with some operating in more than one location and some carrying more than one of our boat brands. The Boat Group's largest dealer, MarineMax, Inc., is a significant external customer that carries a number of the Boat Group's product lines and has multiple locations.

Included within the Boat segment is the Business Acceleration business, which is dedicated to developing emerging and disruptive business models, focusing on services and subscriptions, and engaging the next generation of diverse boaters. Business Acceleration businesses accounted for 14 percent of Boat segment net sales in 2025.

Business Acceleration's Freedom Boat Club (FBC) is the world's largest boat club network. FBC operates in approximately 440 locations across the U.S., Canada, Australia, New Zealand, and Europe, and has over 60,000 memberships. Members pay an upfront initiation fee and ongoing monthly dues in exchange for gaining shared access to their local club’s diverse fleet of boats and reciprocal privileges at all other FBC locations. Business Acceleration also operates a variety of other businesses, including dealer and retail financing; retail extended warranty and insurance businesses; Boateka, a certified pre-owned boat platform; and other marine services businesses.

Financing Services

Through our Brunswick Financial Services Corporation subsidiary, we own a 49 percent interest in a joint venture, Brunswick Acceptance Company, LLC (BAC). Under the terms of the joint venture agreement (JV Agreement), BAC provides secured wholesale inventory floor plan financing to our boat and engine dealers as well as FBC franchisees. A subsidiary of Wells Fargo & Company owns the remaining 51 percent.

The JV Agreement contains a financial covenant that conforms to the maximum leverage ratio test in the Credit Facility described in Note 14 – Debt in the Notes to Consolidated Financial Statements. The JV Agreement contains provisions allowing for the renewal of the JV Agreement or the purchase of the other party's interest in the joint venture at the end of its term. Alternatively, either partner may terminate the JV Agreement at the end of its term. Refer to Note 8 – Financing Joint Venture in the Notes to Consolidated Financial Statements for more information about our financial services offered through BAC.

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Many dealers secure floor plan financing from BAC, and, to a lesser extent, from other third party financing companies, enabling them to stock product in advance of the peak selling season and providing stable channels for our products. Brunswick provides risk mitigation to BAC and other finance companies in the form of inventory repurchase commitments, under which we are obligated to repurchase inventory in the event of a dealer's default. This risk mitigation is reflected in our estimate of repurchase liabilities. Our business units, along with BAC, maintain active credit operations to manage this financial exposure, and we continually seek opportunities to sustain and improve the financial health of our various distribution channel partners. Refer to Note 11 – Commitments and Contingencies in the Notes to Consolidated Financial Statements for further discussion of these arrangements.

In addition to floor plan financing, Business Acceleration’s financial services business provides extended service contracts and related programs through Brunswick Product Protection; risk management and insurance support through a wholly owned captive insurance, Brunswick Strategic Insurance Group; and a digital retail finance solution, Brunswick Finance. Brunswick Finance aims to simplify the consumer's purchase process from the pre-qualification application through underwriting, finalizing agreements, and e-signing for loans.

Distribution

We utilize independent distributors, dealers, and retailers (Dealers) for the majority of our boat sales, sales of parts and accessories, and some sales of marine engines. We have over 20,000 active Dealers serving our business segments worldwide. Our Dealers typically carry one or more product categories and are independent companies or proprietors that range in size from small, family-owned businesses to a large, publicly traded corporation with substantial revenues and multiple locations. Some Dealers sell our products exclusively, while a majority also carry competitor and complementary products. We partner with our Dealer network to improve quality, service, distribution, and delivery of parts and accessories to enhance the boating customer's experience.

Besides our network of independent Dealers, we sell parts and accessories to boat builders and operate our own wholesale parts and accessories distribution companies, which are leading distributors of marine parts and accessories with a network of warehouses located throughout the markets they serve, offering same or next-day delivery to a broad array of marine service facilities and Dealers. In addition, we operate a boat dealer in the Southeastern U.S. with four locations selling boats and parts and accessories.

Technology and Innovation

We believe Brunswick is uniquely positioned to define the future of the global marine industry. We are continuously and consistently innovating the future of recreational boating through frequent releases of new products, features, and functions; delivering intuitive and seamless solutions; advancing artificial intelligence-enabled approaches; and growing service, connectivity, autonomy, and alternative participation capabilities and businesses. To support our goal, we have established cross-functional and cross-business investments and initiatives, and hire leaders with strong technology experience.

In 2025, Navico Group's Simrad brand announced the launch of the Simrad AutoCaptain™ Autonomous Boating System, a revolutionary advancement in marine technology featuring full auto-docking capabilities, including docking, undocking, and short distance maneuvering. Simrad also unveiled the groundbreaking AutoTrack™ feature for the HALO 2000 and HALO 3000 radar systems, with the ability to automatically detect, track, and prioritize moving vessels and other targets, significantly enhancing situational awareness and on-water safety.

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Highlights of other 2025 innovative products and awards include:

•Mercury Racing unveiled its latest R-Series outboard expansion – new 300R and 200R outboards with a 15-inch HD (Heavy Duty) midsection.

•Lund Boats unveiled its all-new Heavy Gauge series, a rugged, purpose-built line of aluminum fishing boats engineered to perform in the most demanding conditions.

•Bayliner introduced its latest innovation, the all-new C21, which won the Moteur Boat of the Year Award in the under 7-meter category, and the Best of Boats Award in the Best for Beginners category.

•The Sea Ray SDX 270 Surf won a prestigious European Powerboat of the Year 2026 award.

•Freedom Boat Club's Mobile App officially launched on the Google Play Store, expanding access to Android users across North America.

•Boating Industry Magazine awarded the 2025 Top Product Award to these Brunswick products:

◦Sea Ray SDX 250 Outboard

◦Simrad Recon trolling motor

◦Boston Whaler 330 Vantage

◦Mercury Marine 75e and 110e Avator electric outboards, and

◦Navan S30.

International Operations

Non-U.S. sales are set forth in Note 2 – Revenue Recognition and Note 5 – Segment Information in the Notes to Consolidated Financial Statements and are also included in the table below, which details our non-U.S. sales by region:

We transact a portion of our sales in non-U.S. markets in local currencies, while a meaningful portion of our product costs are denominated in U.S. dollars as a result of our U.S. manufacturing operations. As a result, the strengthening or weakening of the U.S. dollar affects the financial results of our non-U.S. operations.

Propulsion non-U.S. sales comprised approximately 45 percent of our non-U.S. sales in 2025. Engine P&A non-U.S. sales comprised approximately 20 percent of our non-U.S. sales in 2025. Navico Group non-U.S. sales comprised approximately 18 percent of our non-U.S. sales in 2025. Boat non-U.S. sales comprised approximately 17 percent of our non-U.S. sales in 2025.

Raw Materials and Supplies

From a global supplier base that includes a significant number of U.S. suppliers, we purchase a wide variety of raw materials, parts, and components, including commodities such as aluminum, copper, resins, oil, and steel, as well as finished components such as boat windshields. The cost and availability of these inputs are subject to fluctuations driven by market conditions, inflation, tariffs, and other global economic and trade dynamics. In 2025, our operations experienced intermittent supply‑chain uncertainty and disruptions, which, in some cases, affected pricing, lead times, and availability.

Our global procurement teams actively manage these risks by working to secure adequate supply, leverage purchasing scale across our divisions, improve cost efficiencies, and mitigate the impact of tariffs and other trade‑related costs. These mitigation efforts may include supplier diversification, sourcing adjustments, pricing actions, and contractual approaches designed to reduce or share tariff exposure where practicable. In addition, we

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seek to mitigate commodity price risk on certain raw material purchases through the use of fixed‑price contracts or derivative instruments intended to reduce our exposure to changes in commodity prices.

Intellectual Property

We own intellectual property, including patents, trademarks, and trade secrets, related to our current and future products and production methods, in the U.S. and certain other countries. By law, patents have a limited term, so our patents expire over time. Our trademarks and trade secrets have potentially indefinite lives. We consider our collection of intellectual property to be a valuable asset that is important to our competitive position. As of December 31, 2025, we own more than:

•1,200 active U.S. patents;

•500 pending U.S. patent applications;

•750 active foreign patents;

•200 pending foreign patent applications;

•360 U.S. registered trademarks; and

•2,000 foreign registered trademarks.

We invest substantial resources in acquiring, maintaining, and defending our intellectual property rights, and we expect to continue to do so. When feasible, we seek patent protection on products and production methods that are under development, and in areas of possible future development. We require employees who will develop intellectual property, or who have access to intellectual property, to sign confidentiality and intellectual property assignment agreements. We invest in physical and IT security programs to prevent theft and inadvertent disclosure of trade secrets. In addition to "Brunswick," our primary trademarks include Mercury Marine, Boston Whaler, Lund, and Sea Ray.

Market and Competitive Conditions

Demand for our products is typically seasonal, with sales generally highest in the second quarter of the calendar year. Strong competition exists in most of our product groups, but no single enterprise competes with us in all product groups. In each product area, competitors range in size from large, highly-diversified companies to small, single-product businesses. We also indirectly compete with businesses that offer alternative leisure products or activities. The following summarizes our competitive position in each segment:

Propulsion. The marine engine market is highly competitive among several major international companies, including outboard engine manufacturers based in Japan and several smaller companies. Our competitive advantage is a function of product features, technology, quality and durability, breadth of product line, performance, distribution, and manufacturing capabilities, along with effective promotion, after-sales service, and distribution.

Engine P&A. The marine parts and accessories market is highly competitive and fragmented. Our competitive advantage in this market includes our product breadth and quality, proprietary parts and technology, global distribution network, extensive portfolio of recognized brands, sales team, delivery timing, and service.

Navico Group. Navico Group competes in the marine, RV, and specialty vehicle parts and accessories markets, which are also highly competitive and fragmented. Our competitive advantage in these markets includes our extensive portfolio of recognized brands, proprietary technology, integrated solutions, product quality, sales team, and service offering.

Boat. Although there are many boat manufacturers, few manufacturers compete in the breadth of categories or geographies in which our Boat segment competes. We compete on the bases of product features, technology, quality, brand strength, dealer service, pricing, performance, value, durability, and styling, along with effective promotion and distribution. In addition, Freedom Boat Club competes on number and quality of locations, pricing, and service.

Climate Change and Environmental Compliance

Our customers rely on clean air and water to enjoy our products and services. We are committed to practices and policies designed to help protect the environment and the well-being of our employees, customers, and the public. We strive to improve energy efficiency, reduce the cost of energy, and minimize the carbon emissions of our

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operations, supply chain, and product portfolio with environmental sustainability efforts integrated into our business strategy and operations. We seek to comply with applicable environmental regulatory and industry regulations and standards.

Sustainability accomplishments for 2025 include:

•Activation of two additional on-site solar arrays, for a total of 11 facilities;

•Completion of a heat recovery and reuse system at a Mercury Marine facility in Fond du Lac, Wisconsin;

•Attainment of zero waste-to-landfill status at Navico Group facilities in Wisconsin and the United Kingdom;

•Implementation of wood alternatives that include recycled plastic in Lund and Thunder Jet brand boats;

•Execution of a project to streamline distribution logistics for Navico Group products sold in Asia; and

•Transition to digital product manuals for the Princecraft brand.

For more information on our sustainability strategy, programming, data, recognitions, and goals, we refer you to our annual Sustainability Report (which is not incorporated by reference herein), available on our website at https://www.brunswick.com/corporate-responsibility/sustainability.

For further information, refer to Section 1A, Risk Factors, for a discussion of risks related to environmental compliance and to Note 11 – Commitments and Contingencies in the Notes to Consolidated Financial Statements for a description of certain environmental proceedings.

Human Capital Resources

Brunswick is dedicated to creating an inspiring and welcoming work environment that attracts, develops, and retains top talent. We designed our Employee Value Proposition (EVP) to reflect the shared values that allow our employees to continue to transform the marine industry. The EVP is built around five key behaviors:

•Innovative: Encourages creativity and problem-solving

•Driven: Focuses on achieving goals and continuous improvement

•Exceptional: Strives for excellence in all endeavors

•Authentic: Promotes genuine care and respect for one another

•United: Emphasizes collaboration and teamwork

We thoughtfully incorporate the EVP into various aspects of our business, and the EVP serves as a cultural anchor behind our purpose and strategy.

Employee Information

As of December 31, 2025, we employed approximately 14,000 employees, 95 percent of whom were full-time. Our employee base is approximately 60 percent hourly and 40 percent salaried. Temporary and contingent employees (including interns and co-ops) and contractors accounted for approximately 600 additional workers.

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Approximately 1,800 of our U.S. employees belong to labor unions and approximately 1,000 additional employees are members of international unions or work councils. We believe that our relationships with employees, unions, and work councils remain stable.

Health and Safety

Employee health and safety are top priorities. We seek to proactively identify and address potential safety risks in our business and operations. Our goal is to achieve zero work-related incidents and injuries. We maintain a Safety Management System (SMS) to formally address safety risks throughout the workplace and use our SMS to manage potential work-related hazards that pose a risk of high consequence of potential injury. Implementing processes and systems that meet our SMS criteria is designed to result in less frequent and less severe work-related incidents and injuries, while meeting or exceeding applicable regulatory requirements.

Our recordable and lost-time incident rates* from 2023 to 2025, recorded as of December 31, 2025, are as follows:

*Recordable Rate is the rate of injuries involving treatment beyond first aid per 100 employees; Lost-Time Incident Rate is the rate of injuries per 100 employees in which an employee was not able to work at least one day.

Our global recordable incident rate is considerably lower than the benchmarks of the U.S. Bureau of Labor Statistics for similar businesses and operations. Additionally, we reported no occupational fatalities in 2025.

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Compensation and Benefits

Our compensation philosophy is to encourage performance that creates sustainable, long-term shareholder value; motivates achievement of financial and strategic goals; attracts, retains, and motivates talent; and reinforces our pay-for-performance culture. We are committed, and strive to ensure, that employees are paid equitably for their work, regardless of their gender, race/ethnicity, or age.

We offer market-competitive salaries and wages including incentive bonus opportunities for managers and senior individual contributors, an equity incentive program for director-level positions and above, and a discretionary retirement contribution dependent on Company performance. We also provide a range of benefits (varying by country) that includes paid time off, healthcare coverage, wellness initiatives, and financial savings and protection programs.

Learning and Development

We support career advancement and create a rewarding environment for employees to learn, grow, and perform at their best. We provide opportunities for continuous learning and development, skill building, mentoring, and tuition reimbursement. We recognize the challenges of competing for top talent, particularly in technical fields, and strive to offer our employees career-specific tools, skilled apprenticeship programs, and robust on-the-job training opportunities. Our technical career tracks provide development for engineers and technology personnel who will shape our future ACES initiatives. We also incentivize innovation through a long-established inventor recognition award program.

Our employee development activities include a standard annual performance feedback and management process that engages employees at every stage to continue their professional growth. We also prioritize succession planning to foster internal promotion to key positions, ensuring a strong pipeline of talent to meet future business needs.

Engagement, Inclusion, and Belonging

During 2025, Brunswick again completed a global employee engagement survey, in which approximately 79 percent of employees participated. Insights from the survey will be used to develop action plans at the manager, facility, division, and corporate level to further enhance employee satisfaction and positive connections to Brunswick.

We view inclusion and belonging as strategic business initiatives. Three of our Executive Officers are female. We maintain five employee resource groups (ERGs): Women on Water, Brunswick Black Professionals Network, Asians and Pacific Islanders in Marine, Organization for Hispanic/Latinos for Leadership and Advancement, and Brunswick Veterans Network. These ERGs are self-organized, open to all employees, and focused on cultivating a sense of belonging and inclusion at Brunswick. Each ERG strives to support all of our employees by deepening engagement, unifying and connecting communities, and fostering individual growth.

Ethics and Human Rights

We believe our strong compliance culture plays a central role in our success. The Integrity Playbook, Brunswick’s code of conduct, serves as the foundation of our Ethics Program. In 2025, 97 percent of our active global salaried population completed our annual code of conduct training. In addition, we maintain a global ethics hotline for anyone to ask questions or raise concerns, including anonymously, and we forbid retaliation for good faith reports.

We are committed to upholding human rights in all respects of our operations, as set forth in our global Human Rights Policy, Integrity Playbook, and Supplier Code of Conduct. We prohibit all forms of child labor and forced, bonded, or indentured labor, and human trafficking in our operations and supply chain.

Please see our Sustainability Report (which is not incorporated by reference herein), available on our website, for additional information about our human capital management programs.

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Available Information

Brunswick maintains an Internet website at http://www.brunswick.com that includes links to our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and any amendments to those reports, and Proxy Statements (SEC Filings). The SEC Filings are available without charge as soon as reasonably practicable following the time that they are filed with, or furnished to, the SEC. Shareholders and other interested parties may request email notification of the posting of these documents through the Investors section of our website. Brunswick’s SEC Filings are also available on the SEC’s website at http://www.sec.gov.