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sair Gaming(CRSR) - 2025 Q1 - Earnings Call Transcript
2025-05-06 22:02
Financial Data and Key Metrics Changes - The company reported Q1 2025 net revenue of $369.8 million, a 10% increase from $337.3 million in Q1 2024 [6][18] - Gross profit for Q1 2025 was $102.4 million, up from $86.6 million in Q1 2024, with gross margin increasing to 27.7% from 25.7% [20][22] - Adjusted operating income for Q1 2025 was $20.6 million compared to $15.4 million in Q1 2024, while adjusted EBITDA rose to $22.6 million from $18 million [22][23] Business Segment Data and Key Metrics Changes - The Gamer and Creator Peripheral segment generated $112 million in net revenue, up from $107 million in Q1 2024 [19] - The Gaming Components and Systems segment contributed $257.8 million in net revenue, compared to $230.3 million in Q1 2024 [19] - Memory products revenue increased to $141.1 million in Q1 2025 from $124.9 million in Q1 2024 [19] Market Data and Key Metrics Changes - European markets accounted for 37.2% of Q1 2025 revenues, down from 38% in Q4 2024, while the APAC region increased to 11.3% from 9.1% [18] - The company noted strong demand for components and memory products as enthusiasts build new gaming PCs based on new high-performance GPUs [8][10] Company Strategy and Development Direction - The successful integration of Fanatec is expected to enhance product availability and customer experience, driving incremental revenue [6][7] - The company is focused on leveraging artificial intelligence to improve customer service and operational efficiency, viewing it as a significant growth driver [11][12] - The company maintains a flexible manufacturing strategy to adapt to global trade dynamics and mitigate tariff impacts [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the demand for gaming PCs despite potential economic slowdowns, noting that home entertainment tends to be less affected during recessions [9][33] - The company is cautious about the impact of tariffs on semiconductor products but believes that the current situation may not significantly affect consumer demand [9][10] - The company did not reaffirm full-year 2025 financial guidance due to uncertainties surrounding tariffs but plans to provide updates as visibility improves [24] Other Important Information - The company ended Q1 2025 with a cash balance of $102.5 million and reduced debt to $149 million, down $25 million from the prior quarter [24] - Inventory at the end of Q1 2025 was $276.8 million, reflecting a strategic investment in categories expected to support growth [24] Q&A Session Summary Question: Changes in confidence regarding the hardware refresh cycle around new NVIDIA GPUs - Management indicated that the demand for GPUs and CPUs will significantly influence the decision to build gaming PCs, with tariffs potentially impacting demand [27][28] Question: Drivers of growth in peripherals and components segment - The growth in peripherals was primarily driven by the Fanatec acquisition, while the components segment was limited by the availability of cards rather than tariff-related demand [35][36]
sair Gaming(CRSR) - 2025 Q1 - Quarterly Report
2025-05-06 21:35
PART I. FINANCIAL INFORMATION [Item 1. Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) Corsair's Q1 2025 unaudited financials show net revenue of $369.8 million, a net loss of $10.3 million, and positive operating cash flow of $18.8 million [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q1 2025 saw net revenue rise 9.6% to $369.8 million, gross profit increase to $102.4 million, and net loss improve to $10.5 million Q1 2025 vs Q1 2024 Statement of Operations Highlights (in thousands, except per share amounts) | Metric | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Net revenue | $369,750 | $337,257 | 9.6% | | Gross profit | $102,362 | $86,639 | 18.2% | | Operating loss | $(2,263) | $(10,219) | 77.9% improvement | | Net loss attributable to Corsair | $(10,459) | $(11,565) | 9.6% improvement | | Diluted EPS | $(0.10) | $(0.12) | 16.7% improvement | [Condensed Consolidated Balance Sheets](index=7&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, total assets reached $1.24 billion, with cash at $99.8 million and long-term debt reduced to $136.4 million Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash | $99,843 | $107,011 | | Accounts receivable, net | $219,216 | $218,648 | | Inventories | $276,837 | $259,979 | | Total current assets | $633,359 | $623,388 | | Total assets | $1,239,457 | $1,235,829 | | Accounts payable | $240,114 | $207,215 | | Long-term debt, net | $136,391 | $161,310 | | Total liabilities | $616,165 | $616,377 | | Total stockholders' equity | $608,757 | $604,303 | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Q1 2025 operating cash flow turned positive at $18.8 million, with $22.3 million used in financing activities, including debt repayment Cash Flow Summary (in thousands) | Cash Flow Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash from operating activities | $18,750 | $(26,317) | | Net cash used in investing activities | $(3,072) | $(1,479) | | Net cash used in financing activities | $(22,254) | $(19,949) | | Net decrease in cash | $(7,102) | $(48,381) | | Cash at end of period | $102,529 | $130,183 | [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail accounting policies, segment reporting, Fanatec acquisition adjustments, debt structure, and a valuation allowance on U.S. deferred tax assets - The company operates in two reportable segments: Gamer and Creator Peripherals and Gaming Components and Systems[24](index=24&type=chunk)[30](index=30&type=chunk) - The purchase price allocation for the Fanatec acquisition was adjusted in Q1 2025, resulting in the recognition of **$0.3 million in goodwill** and the reversal of a **$2.6 million bargain purchase gain** recognized in 2024[41](index=41&type=chunk)[42](index=42&type=chunk)[44](index=44&type=chunk) - As of March 31, 2025, the company had an outstanding Term Loan with a principal balance of **$149.0 million**, maturing in September 2026[55](index=55&type=chunk) - A full valuation allowance was recorded against U.S. federal and state deferred tax assets in 2024 due to a cumulative loss position, impacting the effective tax rate[79](index=79&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=27&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 2025 revenue growth of 9.6%, gross margin improvement, segment performance, and strong liquidity, while addressing macroeconomic challenges [Results of Operations](index=32&type=section&id=Results%20of%20Operations) Q1 2025 net revenue grew 9.6% to $369.8 million, gross margin expanded to 27.7%, and SG&A expenses increased 8.4% - Net revenue increased **9.6% YoY**, driven by an **11.9% increase** in Gaming Components and Systems and a **4.7% increase** in Gamer and Creator Peripherals[118](index=118&type=chunk) - Gross margin improved by **200 bps to 27.7%**, attributed to better product mix, lower product costs, and reduced costs for processing inventory returns[119](index=119&type=chunk) - SG&A expenses increased by **$6.8 million (8.4%)** due to higher distribution, marketing, stock compensation, and bad debt expenses, partially offset by a **$5.2 million decrease** in legal and professional fees[121](index=121&type=chunk) - Other expense included a **$2.6 million reversal** of a bargain purchase gain from the Fanatec Acquisition that was recognized in the prior year[125](index=125&type=chunk) [Segment Results](index=36&type=section&id=Segment%20Results) Gamer and Creator Peripherals revenue grew 4.7% to $112.0 million, while Gaming Components and Systems revenue increased 11.9% to $257.8 million Net Revenue by Segment (in thousands) | Segment | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Gamer and Creator Peripherals | $111,973 | $106,973 | 4.7% | | Gaming Components and Systems | $257,777 | $230,284 | 11.9% | | **Total Net Revenue** | **$369,750** | **$337,257** | **9.6%** | Gross Profit and Margin by Segment | Segment | Q1 2025 Gross Profit | Q1 2025 Gross Margin | Q1 2024 Gross Profit | Q1 2024 Gross Margin | | :--- | :--- | :--- | :--- | :--- | | Gamer and Creator Peripherals | $46,414 | 41.5% | $43,643 | 40.8% | | Gaming Components and Systems | $55,948 | 21.7% | $42,996 | 18.7% | | **Total Gross Profit** | **$102,362** | **27.7%** | **$86,639** | **25.7%** | [Liquidity and Capital Resources](index=38&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity includes $102.5 million cash and $99.8 million available credit, with $18.8 million generated from operations and reduced Term Loan balance - Principal sources of liquidity as of March 31, 2025, were **$102.5 million** in cash and restricted cash, and **$99.8 million** available under the Revolving Facility[135](index=135&type=chunk) Cash Flow Summary (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash from Operating activities | $18,750 | $(26,317) | | Net cash used in Investing activities | $(3,072) | $(1,479) | | Net cash used in Financing activities | $(22,254) | $(19,949) | - The company prepaid **$21.9 million** of its Term Loan principal in Q1 2025, reducing the outstanding principal to **$149.0 million**[146](index=146&type=chunk)[147](index=147&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=44&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces market risks from interest rate fluctuations on its variable-rate Term Loan and foreign currency exposure on 20.6% of net revenue - The company is exposed to interest rate risk on its **$149.0 million** variable-rate Term Loan; a **100 basis point** change would impact annual interest expense by about **$1.5 million**[162](index=162&type=chunk) - Foreign currency risk exists as **20.6%** of Q1 2025 net revenue was denominated in foreign currencies, mainly the Euro and British Pound[163](index=163&type=chunk) - The company uses foreign currency forward contracts to hedge against currency fluctuations, with an outstanding notional principal of **$33.6 million** as of March 31, 2025[164](index=164&type=chunk) [Item 4. Controls and Procedures](index=45&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal controls - Management concluded that as of March 31, 2025, the company's disclosure controls and procedures were effective at providing reasonable assurance[169](index=169&type=chunk) - No material changes to the internal control over financial reporting occurred during the quarter ended March 31, 2025[170](index=170&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=46&type=section&id=Item%201.%20Legal%20Proceedings) The company does not anticipate any material adverse effects on its financials from current legal proceedings incidental to business - The company does not expect any current legal proceedings to have a material adverse effect on its business, results of operations, or financial condition[173](index=173&type=chunk) [Item 1A. Risk Factors](index=46&type=section&id=Item%201A.%20Risk%20Factors) A new risk factor addresses potential adverse impacts from changes in trade policies and tariffs, which could increase costs and disrupt supply chains - A new risk factor has been added concerning changes in trade policy and the imposition of tariffs by the U.S. and other countries[175](index=175&type=chunk) - Tariffs and retaliatory actions could increase product costs, limit raw material availability, disrupt the supply chain, and adversely affect sales, costs, and gross margins[176](index=176&type=chunk)[177](index=177&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=46&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales of equity securities or use of proceeds to report during the period - There were no unregistered sales of equity securities during the period[178](index=178&type=chunk) [Item 6. Exhibits](index=48&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including CEO/CFO certifications and XBRL data files - The exhibits filed with this report include CEO and CFO certifications (Exhibits 31.1, 31.2, 32.1) and XBRL data files[183](index=183&type=chunk)
sair Gaming(CRSR) - 2025 Q1 - Earnings Call Transcript
2025-05-06 21:00
Financial Data and Key Metrics Changes - The company reported Q1 2025 net revenue of $369.8 million, a 10% increase from $337.3 million in Q1 2024 [17] - Gross profit for Q1 2025 was $102.4 million, up from $86.6 million in Q1 2024, with gross margin increasing to 27.7% from 25.7% [18][19] - Adjusted operating income for Q1 2025 was $20.6 million compared to $15.4 million in Q1 2024, while adjusted EBITDA rose to $22.6 million from $18 million [21] Business Line Data and Key Metrics Changes - The Gamer and Creator Peripheral segment generated $112 million in net revenue, up from $107 million in Q1 2024 [18] - The Gaming Components and Systems segment contributed $257.8 million in net revenue, compared to $230.3 million in Q1 2024 [18] - Memory products revenue increased to $141.1 million in Q1 2025 from $124.9 million in Q1 2024 [18] Market Data and Key Metrics Changes - European markets accounted for 37.2% of Q1 2025 revenues, down from 38% in Q4 2024, while the APAC region increased to 11.3% from 9.1% [17] - The company noted strong year-over-year growth in the components market, where it maintains a leadership position [15] Company Strategy and Development Direction - The successful integration of Fanatec is expected to enhance product availability and customer experience, driving incremental revenue [5][6] - The company is focused on leveraging artificial intelligence to improve customer service and operational efficiency, viewing it as a significant growth driver [11][12] - Corsair aims to capture market share by adapting quickly to changes in the market and policy environment, particularly regarding tariffs [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about consumer demand for gaming PCs despite potential tariff impacts, noting that home entertainment tends to be less affected during recessions [9][10] - The company is cautious about the economic environment but believes it is well-positioned to navigate challenges due to its flexible manufacturing strategy [14][15] - There is uncertainty regarding full-year 2025 financial guidance due to potential new tariffs, with plans to provide updates as visibility improves [23] Other Important Information - The company ended Q1 with a cash balance of $102.5 million and reduced debt to $149 million, enhancing financial flexibility [23] - Inventory levels increased to $276.8 million, reflecting strategic investments in key categories [23] Q&A Session Summary Question: Confidence in hardware refresh cycle around new NVIDIA GPUs - Management indicated that demand for gaming PCs is closely tied to GPU and CPU costs, with potential tariffs on semiconductors being a significant factor [28] - Early signs show that consumers are starting to build with new NVIDIA 50 series cards, although availability has been limited [29][31] Question: Growth drivers in peripherals and components segment - The growth in peripherals was primarily driven by the successful integration of Fanatec, while the components segment was limited by card availability rather than tariff concerns [34]
sair Gaming(CRSR) - 2025 Q1 - Earnings Call Presentation
2025-05-06 20:12
Financial Performance - Corsair's Q1 2025 net revenue reached $369.8 million, a 9.6% increase year-over-year compared to $337.3 million in Q1 2024[40] - The company's gross profit for Q1 2025 was $102.4 million, representing an 18.1% increase from $86.6 million in Q1 2024[40] - Adjusted EBITDA for Q1 2025 was $22.6 million, a 25.6% increase compared to $18.0 million in Q1 2024[40] - Adjusted earnings per share (diluted) increased by 22.2% to $0.11 in Q1 2025, compared to $0.09 in Q1 2024[40] Segment Results - Gaming Components and Systems segment net revenue was $257.8 million in Q1 2025, an 11.9% increase year-over-year from $230.3 million in Q1 2024[41] - Gamer and Creator Peripherals segment net revenue reached $112.0 million in Q1 2025, a 4.7% increase compared to $107.0 million in Q1 2024[41] - Gross profit margin for the Gamer and Creator Peripherals segment was 41.5% in Q1 2025[41] Market Trends and Partnerships - US NPD data indicates a 20% year-over-year growth in the component and memory categories for March 2025[23] - Corsair has established partnerships with Call of Duty: Warzone, Porsche, and Bentley to enhance brand visibility and market reach[17, 18] FANATEC Integration - The Sim Racing category global TAM is estimated at over $1 billion and is expanding at a double-digit annual growth rate[24]
sair Gaming(CRSR) - 2025 Q1 - Quarterly Results
2025-05-06 20:04
[Financial Performance and Outlook](index=1&type=section&id=Financial%20Performance%20and%20Outlook) This section provides an overview of Corsair's financial results, management's perspective, and recent product developments [First Quarter 2025 Financial Highlights](index=1&type=section&id=First%20Quarter%202025%20Select%20Financial%20Metrics) Corsair reported strong growth in the first quarter of 2025, with net revenue increasing **9.6%** year-over-year to **$369.8 million**, driven by growth in both the Gamer and Creator Peripherals and the Gaming Components and Systems segments. The company's net loss narrowed to **$10.1 million** from **$12.5 million** in the prior-year quarter, while adjusted net income and adjusted EBITDA both saw significant increases, reaching **$12.3 million** and **$22.6 million**, respectively Q1 2025 Key Financial Metrics vs. Q1 2024 | Financial Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Net Revenue | $369.8M | $337.3M | +9.6% | | Net Loss (attributable to common shareholders) | ($10.1M) | ($12.5M) | Improved | | Diluted Net Loss per Share | ($0.10) | ($0.12) | Improved | | Adjusted Net Income | $12.3M | $9.5M | +29.5% | | Adjusted Diluted Net Income per Share | $0.11 | $0.09 | +22.2% | | Adjusted EBITDA | $22.6M | $18.0M | +25.6% | Q1 2025 Segment Net Revenue vs. Q1 2024 | Segment | Q1 2025 Net Revenue | Q1 2024 Net Revenue | Change | | :--- | :--- | :--- | :--- | | Gamer and Creator Peripherals | $112.0M | $107.0M | +4.7% | | Gaming Components and Systems | $257.8M | $230.3M | +12.0% | [Management Commentary and Business Outlook](index=1&type=section&id=Management%20Commentary%20and%20Business%20Outlook) Management expressed satisfaction with Q1 performance, highlighting the successful initial integration of Fanatec and a rebound in the Gaming Components segment. The company is proactively managing tariff risks by diversifying its supply chain, with only **19%** of U.S. imports sourced from China in Q1. While optimistic about continued momentum in the self-built PC market, Corsair is not reaffirming its full-year 2025 guidance due to tariff uncertainties. The company also noted the growing importance of AI as a growth driver and its efforts to strengthen the balance sheet - The initial integration of Fanatec into Corsair's e-commerce, supply chain, and customer support infrastructure was a key milestone, receiving an enthusiastic consumer response[4](index=4&type=chunk) - Corsair has a highly adaptable supply chain to mitigate tariff impacts. In Q1 2025, only **19%** of U.S. imports were from China, and this is expected to decrease. Manufacturing can be shifted to alternative locations within **two to four quarters** if necessary[7](index=7&type=chunk) - Due to uncertainty from newly announced tariffs, the company is not reaffirming its full-year 2025 guidance at this time but remains on track to achieve it if current conditions hold[7](index=7&type=chunk) - AI is becoming a significant growth driver, with Elgato already shipping AI-enhanced tools and customer support leveraging AI-driven systems[7](index=7&type=chunk) - The company has strengthened its balance sheet by reducing debt and enhancing liquidity, enabling strategic investments in innovation and long-term growth[7](index=7&type=chunk) [Recent Developments](index=2&type=section&id=Recent%20Developments) Corsair has recently launched several new products and expanded partnerships. This includes new HXi Series power supplies designed for the latest high-power GPUs from NVIDIA and AMD. The company also expanded its Custom Labs platform to include collaborations with major gaming franchises like Call of Duty and Starfield. Additionally, the Fanatec brand launched a new premium Porsche-licensed steering wheel - Launched HXi Series platinum power supplies with dual 12V-2x6 cables, designed to power demanding GPUs like the **NVIDIA® RTX 50 series** and **AMD® 9070 series**[9](index=9&type=chunk) - Expanded the Custom Labs platform with new options from the Call of Duty and Starfield franchises across multiple product categories[13](index=13&type=chunk) - The Fanatec brand launched the officially licensed CSL Elite Steering Wheel Porsche Vision GT, featuring a new premium microfiber fabric called Tactaris[13](index=13&type=chunk) [Financial Statements](index=6&type=section&id=Financial%20Statements) This section presents Corsair's consolidated financial statements, including statements of operations, segment information, balance sheets, and cash flows [Condensed Consolidated Statements of Operations](index=6&type=section&id=Corsair%20Gaming%2C%20Inc.%20Condensed%20Consolidated%20Statements%20of%20Operations) For the first quarter of 2025, Corsair's net revenue grew to **$369.8 million** from **$337.3 million** in the prior-year period. Gross profit increased to **$102.4 million**, up from **$86.6 million**. The company significantly reduced its operating loss to **$(2.3) million** compared to **$(10.2) million** in Q1 2024. Consequently, the net loss attributable to common shareholders improved to **$(10.1) million**, or **$(0.10) per share**, from **$(12.5) million**, or **$(0.12) per share**, year-over-year Q1 2025 Statement of Operations Highlights (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net revenue | $369,750 | $337,257 | | Gross profit | $102,362 | $86,639 | | Operating loss | $(2,263) | $(10,219) | | Net loss attributable to common stockholders | $(10,067) | $(12,540) | | Net loss per share, diluted | $(0.10) | $(0.12) | [Segment Information](index=7&type=section&id=Corsair%20Gaming%2C%20Inc.%20Segment%20Information) In Q1 2025, both of Corsair's segments showed year-over-year growth. The Gamer and Creator Peripherals segment's net revenue increased to **$112.0 million** with a gross margin of **41.5%**. The larger Gaming Components and Systems segment saw a more substantial revenue increase to **$257.8 million**, with its gross margin expanding significantly to **21.7%** from **18.7%** in the prior year, contributing to an overall company gross margin of **27.7%** Q1 2025 Segment Performance vs. Q1 2024 | Segment & Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Gamer and Creator Peripherals** | | | | Net Revenue | $111.97M | $106.97M | | Gross Profit | $46.41M | $43.64M | | Gross Margin | 41.5% | 40.8% | | **Gaming Components and Systems** | | | | Net Revenue | $257.78M | $230.28M | | Gross Profit | $55.95M | $43.00M | | Gross Margin | 21.7% | 18.7% | | **Total Company** | | | | Total Net Revenue | $369.75M | $337.26M | | Total Gross Margin | 27.7% | 25.7% | [Condensed Consolidated Balance Sheets](index=8&type=section&id=Corsair%20Gaming%2C%20Inc.%20Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, Corsair's balance sheet showed total assets of **$1.24 billion**. Cash and restricted cash stood at **$102.5 million**. Inventories increased to **$276.8 million** from **$260.0 million** at the end of 2024. The company continued to de-lever, with long-term debt, net, decreasing to **$136.4 million** from **$161.3 million** over the quarter. Total stockholders' equity remained stable at **$608.8 million** Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and restricted cash | $102,282 | $109,385 | | Inventories | $276,837 | $259,979 | | Total assets | $1,239,457 | $1,235,829 | | Long-term debt, net | $136,391 | $161,310 | | Total liabilities | $616,165 | $616,377 | | Total stockholders' equity | $608,757 | $604,303 | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Corsair%20Gaming%2C%20Inc.%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the three months ended March 31, 2025, Corsair generated **$18.8 million** in cash from operating activities, a significant turnaround from the **$26.3 million** used in the same period of 2024. This improvement was driven by better net loss and favorable changes in working capital, particularly accounts payable. The company used **$22.3 million** in financing activities, mainly for a **$25.0 million** debt repayment. Overall, cash and restricted cash decreased by **$7.1 million** during the quarter Q1 2025 Cash Flow Summary (in thousands) | Cash Flow Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $18,750 | $(26,317) | | Net cash used in investing activities | $(3,072) | $(1,479) | | Net cash used in financing activities | $(22,254) | $(19,949) | | **Net decrease in cash and restricted cash** | **$(7,102)** | **$(48,381)** | [Non-GAAP Financial Measures](index=4&type=section&id=Non-GAAP%20Financial%20Measures) This section explains Corsair's use of non-GAAP financial measures and provides reconciliations to their GAAP equivalents [Use of Non-GAAP Financial Measures](index=4&type=section&id=Use%20and%20Reconciliation%20of%20Non-GAAP%20Financial%20Measures) Corsair utilizes non-GAAP financial measures, including adjusted operating income, adjusted net income, and adjusted EBITDA, to supplement its GAAP-based financial results. The company believes these measures offer investors a clearer understanding of its core operating performance by excluding certain non-cash or non-recurring expenses such as amortization, stock-based compensation, acquisition costs, and restructuring charges. These metrics are used internally by management for performance evaluation and planning - The company presents non-GAAP financial information as it believes these measures help identify underlying business trends that could be masked by excluded expenses[16](index=16&type=chunk) - Key adjustments to derive non-GAAP figures include backing out amortization, stock-based compensation, one-time legal costs, acquisition and integration costs, and restructuring charges[18](index=18&type=chunk)[21](index=21&type=chunk) [GAAP to Non-GAAP Reconciliations](index=10&type=section&id=GAAP%20to%20Non-GAAP%20Reconciliations) In Q1 2025, Corsair's non-GAAP metrics showed significant improvement over their GAAP counterparts and the prior year. The GAAP operating loss of **$(2.3) million** was adjusted to a non-GAAP operating income of **$20.6 million**. The GAAP net loss of **$(10.3) million** reconciled to a non-GAAP adjusted net income of **$12.3 million**. Adjusted EBITDA increased to **$22.6 million** from **$18.0 million** year-over-year, with the adjusted EBITDA margin expanding to **6.1%** from **5.3%** Q1 2025 GAAP to Non-GAAP Reconciliation Highlights (in thousands) | Metric | Q1 2025 GAAP | Q1 2025 Non-GAAP | Q1 2024 Non-GAAP | | :--- | :--- | :--- | :--- | | Operating Income (Loss) | $(2,263) | $20,636 | $15,398 | | Net Income (Loss) | $(10,317) | $12,319 | $9,516 | | Adjusted EBITDA | N/A | $22,643 | $18,024 | Q1 2025 Margin Comparison | Margin | GAAP | Non-GAAP | | :--- | :--- | :--- | | Operating Margin | -0.6% | 5.6% | | Adjusted EBITDA Margin | N/A | 6.1% |
Enthusiast Gaming Launches New Season of its Content Creator Competition, Rising Stars
Newsfilter· 2025-03-06 12:00
Core Insights - Enthusiast Gaming Holdings Inc. announced a new season of Rising Stars, an interactive campaign that offers a $100,000 contract to a grand prize winner to join Luminosity Gaming as a content creator [1] - The campaign aims to support smaller gaming content creators through creative challenges, culminating in a virtual livestream finale featuring notable Luminosity content creators [2][5] - The entire season is sponsored by Elgato, with additional support from various brands, enhancing brand visibility and engagement [4] Company Strategy - Luminosity Gaming focuses on livestreamed content creation, engaging millions of viewers monthly and fostering passionate communities [3] - The initiative is part of a broader strategy to enhance brand consideration and product awareness for sponsors while celebrating diverse voices in the gaming community [6] - The submission window for Rising Stars opened on March 1st and will close on March 7th, encouraging aspiring creators to participate [6] Industry Context - Enthusiast Gaming positions itself as a leading gaming media and entertainment company in North America, connecting video game enthusiasts and esports fans [7] - The company leverages its core pillars—creators, content, communities, games, and experiences—to create integrated brand solutions targeting Gen Z and Millennial audiences [7]
sair Gaming(CRSR) - 2024 Q4 - Annual Report
2025-02-26 21:45
Business Risks and Market Conditions - The company faces significant risks that could adversely affect its business, reputation, financial condition, and future prospects[60]. - The company operates in a highly competitive market characterized by rapid technological change and aggressive price competition, which could lead to a loss of market share[68]. - Economic conditions, including high inflation and reduced consumer spending, may adversely affect demand for high-performance gaming products[88]. - The war between Russia and Ukraine may prolong GPU shortages due to resource supply disruptions[84]. - Cloud computing adoption could diminish demand for high-performance gaming hardware, posing a risk to the business[87]. - The company faces geopolitical risks due to the concentration of manufacturing in China, Taiwan, and Southeast Asia[108]. - The ongoing wars in Ukraine and the Middle East have contributed to significant market disruptions and volatility in commodity prices[96]. - The company faces risks related to international operations, including political and economic instability, which may harm its business[138]. Sales and Revenue Trends - Sales are influenced by the introduction and success of new high-performance computer hardware, particularly GPUs and CPUs, as well as sophisticated new video games[66]. - The company experienced a decrease in demand for products in the Gaming Components and Systems segment due to a slowdown in the self-built PC market in 2024, with expectations for demand to pick up with the next substantial GPU launch in 2025[66]. - The gaming industry’s growth, including live game streaming and esports, is crucial for the company’s growth prospects, with any decline potentially harming the business[73]. - Seasonal fluctuations in sales are expected, with total unit shipments typically highest in Q3 and Q4, and lowest in Q1 and Q2[81]. - Net revenue for 2024 was $1,316.4 million, a decrease of 9.8% from $1,459.9 million in 2023[255]. - Net revenue decreased by $143.5 million, or 9.8%, in 2024 compared to 2023, primarily due to a 20.8% decrease in sales for the Gaming Components and Systems segment, partially offset by a 19.7% increase in the Gamer and Creator Peripherals segment[281]. Product Development and Innovation - The competitive position and success depend on the ability to build and maintain brand strength among gaming enthusiasts, with a focus on continuous innovation and marketing efforts[61]. - The introduction of new and enhanced computer games is essential for sustaining consumer interest in gaming, which directly impacts the demand for the company’s products[67]. - The need for continuous product development increases the risk of defects, which could lead to increased warranty costs and damage to reputation[107]. - Product development expenses were $67.5 million and $65.3 million for the years ended December 31, 2024 and 2023, representing 5.1% and 4.5% of net revenue respectively[118]. - The company launched 78 new products in 2024, which positively impacted net revenue[262]. Supply Chain and Manufacturing - Supply chain issues, including raw material scarcity, could lead to increased costs and delays in product production, adversely affecting financial performance[78]. - The company relies on a limited number of suppliers for DRAM ICs, which poses risks if supply is disrupted[95]. - The company has limited manufacturing facilities and depends on third-party manufacturers, which may lead to product shortages and quality control issues[103]. - The company’s operations are subject to the U.S. Foreign Corrupt Practices Act and other anti-corruption laws, with potential severe consequences for violations[217]. Financial Performance and Costs - Gross margin improved to 24.9% in 2024 from 24.7% in 2023, compared to 21.6% in 2022[255]. - The company reported a net loss of $85.2 million in 2024, compared to a net loss of $2.6 million in 2023[255]. - Cash and restricted cash decreased to $109.6 million in 2024 from $178.6 million in 2023[256]. - Sales, general and administrative (SG&A) expenses increased by $24.7 million, or 8.7%, in 2024, driven by a $9.3 million rise in distribution costs and an $8.9 million increase in legal and professional service expenses[284]. - Total operating expenses increased to $377,551 thousand in 2024 from $350,574 thousand in 2023[280]. Customer and Market Relationships - The company relies on effective customer support to maintain customer loyalty and resolve product-related issues, which is critical for brand marketing[62]. - Sales to Amazon represented 30.9% and 30.7% of net revenue in 2024 and 2023, respectively, with the top ten customers accounting for 53.1% and 55.4% of net revenue[102]. - The company relies on third-party ecommerce service providers for online sales, and any failure in their performance could negatively impact sales and reputation[173]. Regulatory and Compliance Issues - The company is subject to complex customs and tariff regulations that could increase costs and affect margins[116]. - The company is subject to various federal and state regulations, and noncompliance could result in significant penalties and harm to its business[214]. - The company has implemented internal controls to promote compliance with anti-corruption laws, but risks remain from employee actions that could lead to investigations[219]. - Compliance with evolving data privacy regulations, such as the California Consumer Privacy Act, poses challenges and potential risks to the company's operations[157]. Ownership and Governance - The company is controlled by a single stockholder, EagleTree, which may have different interests than other stockholders[61]. - EagleTree beneficially owned approximately 53.7% of the common stock as of December 31, 2024, allowing it to control the company's affairs[189]. - The company is classified as a "controlled company" under Nasdaq rules, which allows it to rely on exemptions from certain corporate governance requirements[192]. - The company has anti-takeover provisions in its amended and restated certificate of incorporation that could delay or prevent changes in control or management[201].
sair Gaming(CRSR) - 2024 Q4 - Earnings Call Presentation
2025-02-13 01:41
Q4 AND FY2024 UPDATE February 12, 2025 DISCLAIMER Forward Looking Statements This presentation contains express and implied forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements regarding the Company's financial outlook for the full year 2025; market headwinds and tailwinds, including its expectations regarding the gaming market's continued growth; new product launches, the entry into new product categories and demand ...
sair Gaming(CRSR) - 2024 Q4 - Earnings Call Transcript
2025-02-13 01:40
Financial Data and Key Metrics Changes - Q4 2024 net revenue was $413.6 million, a decrease from $417.3 million in Q4 2023 [24] - Full year 2024 net revenue was $1,316.4 million, down from $1,459.9 million in 2023 [24] - Q4 2024 adjusted EBITDA was $33.1 million compared to $33.7 million in Q4 2023 [32] - Full year 2024 adjusted EBITDA was $54.7 million, down from $95.1 million in 2023 [32] - Q4 2024 net income attributable to common shareholders was $1.3 million or $0.01 per diluted share, compared to $6.2 million or $0.06 per diluted share in Q4 2023 [31] Business Line Data and Key Metrics Changes - Gamer and Creator Peripherals segment revenue in Q4 2024 was $169.6 million, up from $136.8 million in Q4 2023 [25] - Gaming Components and Systems segment revenue in Q4 2024 was $244.1 million, down from $280.5 million in Q4 2023 [26] - Memory products revenue in Q4 2024 was $126.3 million, down from $145.5 million in Q4 2023 [26] - Gross profit for the Gamer and Creator Peripherals segment was $63.9 million in Q4 2024, compared to $50.9 million in Q4 2023 [27] Market Data and Key Metrics Changes - European markets contributed 38% of Q4 2024 revenues, slightly down from 38.4% in Q3 2024 [25] - APAC region contributed 9.1% of Q4 2024 revenues, down from 10.3% in Q3 2024 [25] Company Strategy and Development Direction - The company is focused on integrating the Fanatec sim racing business and expanding its footprint in the sim racing market [10][12] - Corsair aims to capitalize on the anticipated demand from the new GPU launches and the upcoming release of GTA 6 [9][10] - The company plans to continue investing in innovation and reducing operating costs while strengthening its balance sheet [23] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, citing strong demand for high-end components and the successful integration of Fanatec [10][12] - The company expects revenue growth to improve in 2025, with a range of $1.4 billion to $1.6 billion projected [38] - Management noted that the impact of new tariffs has been considered in their guidance, with a focus on mitigating risks [70][74] Other Important Information - The company announced that Andy Paul will retire at the end of Q2 2025, with Thi La set to become the new CEO [17][18] - The company ended Q4 with a cash balance of $109.6 million and $174 million of debt, down $25 million year-over-year [33][34] Q&A Session Summary Question: Is the Fanatec acquisition on track to be completed by the second quarter? - The integration is largely complete, focusing on customer service and logistics improvements [43][44] Question: How have partnerships with Activision and Apple impacted the business? - Significant traffic increase was noted on the website following the Call of Duty: Black Ops 6 launch, indicating a valuable marketing relationship [49][50] Question: What is the expected cadence for the GPU refresh and its impact on revenue? - Anticipation for the GPU refresh is high, with a gradual pickup in sales expected throughout the year [60][62] Question: How does the company view its position regarding tariffs compared to competitors? - The company has mitigated tariff impacts effectively and feels comfortable with its current guidance [74] Question: How beneficial is NVIDIA's AI services business for Corsair? - The company has not targeted data centers but sees potential demand from individuals building workstations for AI models [87][89]
sair Gaming(CRSR) - 2024 Q4 - Annual Results
2025-02-12 21:05
Revenue Performance - Net revenue for Q4 2024 was $413.6 million, a slight decrease from $417.3 million in Q4 2023, with a 20% year-over-year growth in the Gamer and Creator Peripherals segment[5]. - Full year 2024 net revenue totaled $1,316.4 million, down from $1,459.9 million in 2023, with Gamer and Creator Peripherals segment revenue increasing to $472.7 million from $394.9 million[5]. - Net revenue for Q4 2024 was $413.6 million, a decrease of 0.2% from $417.3 million in Q4 2023[23]. - The segment of Gaming Components and Systems generated $244.1 million in revenue, down from $280.5 million in Q4 2023[25]. Profitability - Net loss attributable to common shareholders for 2024 was $99.2 million, or $0.95 per diluted share, compared to a net income of $3.2 million, or $0.03 per diluted share in 2023[5]. - Adjusted EBITDA for Q4 2024 was $33.1 million, slightly down from $33.7 million in Q4 2023, while full year adjusted EBITDA decreased to $54.7 million from $95.1 million in 2023[5]. - Operating income for Q4 2024 was $5.9 million, down from $12.1 million in Q4 2023, while the total operating expenses rose to $102.3 million from $90.6 million[23]. - Net loss attributable to Corsair Gaming, Inc. was $2.3 million in Q4 2024, compared to a net income of $7.0 million in Q4 2023[23]. - Net income for the three months ended December 31, 2024, was $2,728,000, a decrease of 64% compared to $7,576,000 for the same period in 2023[29]. - Adjusted Operating Income for the three months ended December 31, 2024, was $31,725,000, representing 7.7% of net revenue, compared to $31,792,000 or 7.6% in the same period of 2023[31]. - The diluted net income per share for the three months ended December 31, 2024, was $0.01, down from $0.06 in the same period of 2023[34]. - The company reported a net loss attributable to common stockholders of $99,175,000 for the year ended December 31, 2024, compared to a net income of $3,187,000 in 2023[34]. Cash Flow and Assets - Cash and restricted cash decreased to $109.4 million from $178.3 million year-over-year[27]. - Net cash provided by operating activities for the three months ended December 31, 2024, was $55,555,000, slightly down from $57,093,000 in the same period of 2023[29]. - The company reported a net cash increase of $48,025,000 for the three months ended December 31, 2024, compared to an increase of $30,794,000 in the same period of 2023[29]. - The net cash used in investing activities for the year ended December 31, 2024, was $52,705,000, compared to $26,981,000 in 2023[29]. - Total assets decreased to $1.236 billion as of December 31, 2024, from $1.357 billion a year earlier[27]. - Corsair Gaming's total liabilities decreased to $616.4 million from $663.5 million year-over-year[27]. Segment Performance - The Gamer and Creator Peripherals segment's gross profit now exceeds that of the Gaming Components and Systems segment, indicating a shift in profitability focus[6]. - The company reported a gross profit of $63.9 million from Gamer and Creator Peripherals, up from $50.9 million in Q4 2023, indicating a gross margin of 37.7%[25]. - Gross profit increased to $108.2 million in Q4 2024, up from $102.7 million in Q4 2023, resulting in a gross margin of 26.2% compared to 24.6%[25]. Future Outlook - Corsair expects revenue for 2025 to be in the range of $1.4 billion to $1.6 billion, with adjusted EBITDA projected between $80 million and $100 million[11]. - The company anticipates a rebound in demand for high-performance gaming gear, driven by new GPU launches and a growing market for PC upgrades[8]. - Corsair's recent acquisition of Fanatec is expected to contribute to revenue growth, with new products like the ClubSport GT Cockpit being introduced[6]. - The company plans to continue organic growth alongside strategic acquisitions in high-value peripherals[6]. - Corsair's K65 Wireless keyboard and M75 Gaming mouse have been selected by Apple for retail, enhancing brand visibility and market reach[12].