Core Viewpoint - Turtle Beach Corporation has entered into a definitive agreement to repurchase 694,926 shares of common stock from Diversis Capital for approximately $10 million at a price of $14.41 per share, reflecting the company's confidence in its long-term value creation strategy [1][3]. Group 1: Share Repurchase Details - The share repurchase involves 694,926 shares at a total cost of about $10 million, executed at the 30-day volume weighted average price of $14.41 per share [1]. - Simultaneously, The Donerail Group acquired 693,962 shares from Diversis at the same price, resulting in Diversis owning approximately 10% of Turtle Beach's common stock post-transaction [2]. - The remaining shares owned by Diversis will be subject to a new 90-day lock-up agreement [2]. Group 2: Management Commentary - The CEO of Turtle Beach expressed confidence in the company's strategy and long-term value creation, emphasizing the alignment of the repurchase with capital allocation priorities [3]. - A managing partner from The Donerail Group highlighted the significant transformation of Turtle Beach over the past two years and expressed excitement about increasing their investment [3]. Group 3: Financial Context - The repurchase was executed under the company's existing $75 million authorization and aligns with its credit agreement and capital return framework [3]. - The recent refinancing of Turtle Beach's debt facilities provided the necessary flexibility to carry out this transaction, demonstrating the company's commitment to utilizing share repurchases to enhance shareholder value [3]. Group 4: Company Overview - Turtle Beach Corporation is a leading provider of gaming accessories, known for its best-selling gaming headsets and top-rated gaming peripherals [4]. - The company has established itself as a market leader in console gaming audio for over a decade, with a strong reputation among gamers and a broad range of innovative products [4].

Turtle Beach (HEAR) FY Conference Summary Company Overview - **Company**: Turtle Beach - **Industry**: Gaming Accessories Key Points and Arguments Business Performance and Strategy - The CEO highlighted significant changes in Turtle Beach's business model over the past two years, focusing on improving performance and adapting to market dynamics [3][4] - The company has rationalized its SKUs, emphasizing higher productivity and margin products, and optimized its distribution channels [3][4] - The acquisition of PDP, a leader in the controller space, has diversified Turtle Beach's offerings beyond headsets, which historically accounted for 95% of the business [4][5] Market Trends and Growth Opportunities - The current gaming cycle, including the launch of Nintendo's Switch 2 and the anticipated release of GTA 6, is expected to drive accessory purchases [5][6][8] - The company is well-positioned to capitalize on upcoming hardware releases from Microsoft and Sony, which could further stimulate growth [7][8] - Despite a challenging first half of the year, the company anticipates a recovery in the second half, with a projected decline of about 10% in key categories in the U.S. [12][13] Supply Chain Management - Turtle Beach has proactively developed manufacturing capabilities in Vietnam to mitigate the impact of tariffs on production costs, with an expected 85% of production to be based in Vietnam post-Q2 2025 [9][10] - The company bulked up on inventory to counteract tariff impacts, which has helped maintain competitiveness [11] Financial Outlook - The company reiterated its revenue guidance for 2025, despite experiencing a 15-17% decline in key categories year-to-date [12][13][21] - Gross margins improved to 32.2% in Q2, with expectations to reach mid to high thirties in the latter half of the year due to better product mix and cost management [24][25] Competitive Landscape - The competitive environment is intensifying, but Turtle Beach maintains a leadership position in audio and controller markets due to its R&D investments [19][20][33] - The company is focused on leveraging new technologies and product refreshes to stay ahead in the premium headset category [33][36] R&D and Marketing Balance - Turtle Beach invests approximately 5% of its revenue back into R&D, which has led to successful product launches and technological advancements [38][39] - The marketing team has undergone significant changes, including brand refreshes and integration of acquired products, to enhance consumer engagement [40] Capital Allocation Strategy - The company has successfully refinanced its debt, reducing costs and improving cash flow generation, with a focus on three pillars: organic investment, M&A, and share repurchases [42][45] - The acquisition of PDP has been transformative, and the company remains open to further M&A opportunities across all product categories [47][48] Future Outlook - The CEO expressed optimism about the gaming industry's growth potential, particularly with the upcoming hardware cycles and the need for gamers to upgrade their accessories [49][50] - The company anticipates a multi-year growth cycle driven by high gamer engagement and the replacement of pandemic-era purchases [50][51] Additional Important Insights - The company is adapting its product designs and marketing strategies to align with macro trends in gaming, focusing on large franchise games and community engagement [41][42] - The competitive landscape for headsets is evolving, with consolidation in the market, but Turtle Beach is well-positioned to leverage its expertise and technology [33][36]

Company Overview - Turtle Beach Corporation is a leading gaming accessories brand known for designing best-selling gaming headsets, top-rated game controllers, award-winning PC gaming peripherals, and groundbreaking gaming simulation accessories [3] - The company has been a market leader in console gaming audio for over a decade and acquired Performance Designed Products LLC in 2024 [3] - Turtle Beach's shares are traded on the Nasdaq Exchange under the symbol TBCH [3] Upcoming Events - CEO Cris Keirn will host a fireside chat on August 12 at 2:55 p.m. ET during the Oppenheimer 28th Annual Technology, Internet & Communications Conference [2] - Management will be available for meetings during the conference, and a live webcast of the event will be accessible through the "Events & Presentations" section of the company's website [2] Investor Relations - A replay of the webcast will be available on the investor relations website for 90 days following the event [2]

Financial Data and Key Metrics Changes - The company reported second quarter revenue of $56.8 million, reflecting a decrease due to dampened market conditions in the gaming accessories industry [11] - Gross margins improved to 32% from 30% in the prior year, demonstrating effective cost optimization initiatives despite lower revenue [11][12] - Adjusted EBITDA loss for the second quarter was $3 million, with expectations for a notable increase in adjusted EBITDA in the second half of the year, guiding for a full year range of $47 million to $53 million [13][14] Business Line Data and Key Metrics Changes - The company has seen improvements in year-on-year market comparisons in Q2, particularly in the headset and third-party controller markets, which were down mid-teens year-to-date compared to over 20% at the end of Q1 [10][25] - The launch of Nintendo Switch 2 has driven strong sales in related accessories, indicating a positive trend in the gaming accessories market [10][29] Market Data and Key Metrics Changes - The overall gaming accessories market is expected to remain down for the full year 2025, but improvements are anticipated in the second half of the year, setting the stage for strong growth in 2026 [10][11] - The company noted that less than 15% of total U.S. supply will be produced in China after Q1, up from approximately 10% previously discussed [7] Company Strategy and Development Direction - The company is focused on three primary objectives: delivering Q2 results, advancing capital allocation strategies including stock buybacks, and refinancing credit facilities to strengthen capital structure [5][9] - The capital allocation strategy emphasizes investments in organic growth, share repurchases, and accretive mergers and acquisitions [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strengthened strategic positioning and opportunities ahead as the outlook for gaming accessories improves [19] - The macroeconomic environment has tracked closely to expectations, with improvements driven by successful product launches like the Nintendo Switch 2 [24][26] Other Important Information - The company successfully repurchased approximately $5 million of stock at an average price of $13.47 as part of its $75 million share repurchase program [8][16] - A comprehensive refinancing of the term loan and credit facility was completed, resulting in a reduced interest rate and enhanced operational flexibility [9][15] Q&A Session Summary Question: Reflection on changes since the last quarterly call regarding the U.S. economy, tariffs, and game title releases - Management noted that the macroeconomic pressures remain but improvements are expected, particularly driven by the successful launch of Nintendo Switch 2 [24][26] Question: Lift in sales of Nintendo-related products - Management confirmed strong sales in June for Nintendo-related accessories, indicating a positive trend following the hardware release [29] Question: Improvement in market conditions across product lines - Management indicated that improvements were seen across gaming accessories, particularly in controllers and headsets, with expectations for continued improvement in the back half of the year [34]

SECOND QUARTER 2025 EARNINGS PRESENTATION NASDAQ: TBCH | AUGUST 7, 2025 SAFE HARBOR STATEMENT & IMPORTANT INFORMATION Forward-Looking Information and Statements This presentation, including the appendix, includes forward-looking information and statements within the meaning of the federal securities laws. Except for historical information contained in this release, statements in this release may constitute forward-looking statements regarding assumptions, projections, expectations, targets, intentions or be ...

Core Insights - Turtle Beach Corporation reported a net revenue of $56.8 million for the quarter ended June 30, 2025, reflecting ongoing execution in a challenging economic environment [1][8] - The company achieved a gross margin of 32.2%, an increase of 200 basis points compared to the prior year, despite facing tariff impacts [2][5] - The net loss for the quarter was $2.9 million, a significant improvement from a net loss of $7.5 million in the prior year [2][8] - Adjusted EBITDA for the quarter was ($3.0) million, indicating ongoing challenges but showing resilience in operations [2][8] Financial Performance - The company reiterated its full-year guidance for revenue in the range of $340 million to $360 million and Adjusted EBITDA between $47 million and $53 million [8][9] - Turtle Beach's gross margin improved year-over-year, despite an approximate 150 basis point negative impact from tariffs [5][8] - The company reported a year-over-year reduction in net loss, indicating improved operational efficiency and cost management [2][8] Debt Refinancing - Turtle Beach successfully refinanced its existing debt facilities, lowering the cost of capital on the prior term loan by approximately 450 basis points, resulting in annual dollar cost savings of over $2.0 million [3][6] - The new $150 million facility includes a $90 million revolving credit facility and a $60 million term loan, enhancing financial flexibility [6][8] Share Repurchase Program - In the second quarter, Turtle Beach repurchased $5.0 million of common stock under a $75 million share repurchase agreement, demonstrating a commitment to returning capital to shareholders [7][8] - The company plans to remain opportunistic in share buybacks moving forward, supported by enhanced financial flexibility from the recent refinancing [7][8] Market Outlook - The CEO expressed optimism about market improvements in the gaming accessories space, indicating that the company is well-positioned to capitalize on key industry growth drivers into 2026 [5][8] - The company’s strategic actions in cost optimization and production adaptation have significantly mitigated tariff impacts, supporting a positive outlook for revenue and profitability recovery [5][8]

Core Viewpoint - Turtle Beach Corporation has successfully completed a comprehensive refinancing of its credit facilities, which strengthens its capital structure and enhances financial flexibility [1][4]. Group 1: Refinancing Details - The company entered into a new senior secured credit facility totaling $150 million, which includes a $90 million revolving credit facility and a $60 million term loan [2]. - The new facility replaces previous debt arrangements and will be utilized for ongoing working capital and general corporate purposes [2]. - Borrowings under the new facility will have an interest rate based on the Secured Overnight Financing Rate (SOFR) plus an applicable margin, with an initial rate of SOFR plus 325 basis points, a reduction of approximately 450 basis points compared to the prior term loan [3]. Group 2: Strategic Implications - The refinancing is viewed as a significant milestone in the execution of the company's strategy, providing a financial foundation for future growth and commitments to shareholders [4]. - The new loans feature improved pricing and extended maturity, maturing on August 1, 2028, which significantly reduces the company's cost of capital [3][4]. Group 3: Company Overview - Turtle Beach Corporation is a leading provider of gaming accessories, known for its best-selling gaming headsets, top-rated game controllers, and award-winning PC gaming peripherals [4]. - The company acquired Performance Designed Products LLC in 2024, further expanding its product offerings [4]. - Turtle Beach's shares are traded on the Nasdaq Exchange under the symbol TBCH [4].

Core Viewpoint - Turtle Beach Corporation will report its financial results for the second quarter of 2025 on August 7, 2025, after the market closes [1] Group 1: Financial Reporting - The financial results will be discussed in a conference call and audio webcast at 4:30 p.m. ET / 1:30 p.m. PT on the same day [2] - The call will be hosted by the CEO Cris Keirn and CFO Mark Weinswig [2] Group 2: Conference Call Information - The live webcast will be accessible on the Company's "Events & Presentations" page [3] - Participants can join the call by dialing 1-844-826-3035 or 1-412-317-5195, with a recommendation to call in 15 minutes early [3] Group 3: Replay Information - A telephone replay of the call will be available until August 21, 2025, accessible by dialing 1-844-512-2921 or 1-412-317-6671 with passcode 10200768 [4] - A replay of the webcast will also be available on the investor relations website for a limited time [4] Group 4: Company Overview - Turtle Beach Corporation is a leading provider of gaming accessories, known for its best-selling gaming headsets and top-rated game controllers [5] - The Company has been a market leader in console gaming audio for over a decade and acquired Performance Designed Products in 2024 [5] - Turtle Beach's shares are traded on the Nasdaq Exchange under the symbol TBCH [5]

Market Position and Brand Strength - Turtle Beach is the best-selling gaming headset brand for the past 15 years[6] - The company is a top 5 gaming accessory leader in the $11 billion global gaming accessories market[6] - Turtle Beach has over 400 patents and is a leading innovator in gaming accessories[8] - The brand has the highest headset brand loyalty among active PC and/or console headset owners in the U S[9] Financial Performance and Growth - Q4 2024 revenue reached a record of $146 1 million, a 47% increase year-over-year[61] - 2024 revenue reached a record of $372 8 million, a 44% increase year-over-year[63] - Adjusted EBITDA for 2024 grew nearly $50 million to $56 4 million[64] - The company repurchased $27 8 million in common shares during 2024[65] Market and Product Strategy - The total addressable market for gaming headsets is roughly $2 9 billion[37] - The total addressable market for PC gaming peripherals is roughly $3 9 billion[50] - The market for PC/console flight sim hardware adds over $414 million in global market opportunity, and racing sim adds another $753 million[54]

Core Viewpoint - Turtle Beach Corporation has secured a waiver under its existing debt agreement, allowing for share repurchases of up to $5 million before June 30, 2025, as part of a new $75 million authorization, reflecting confidence in its balance sheet and long-term outlook [1][2] Financial Actions - The company will pay down $5 million of its outstanding term loan debt facility as part of the amendment to its debt agreement [1] - Discussions are ongoing to refinance the outstanding loan balance on improved terms, with updates to be provided at an appropriate time [2] Company Overview - Turtle Beach Corporation is a leading provider of gaming accessories, known for its best-selling gaming headsets, top-rated game controllers, and award-winning PC gaming peripherals [3] - The company acquired Performance Designed Products LLC in 2024, further expanding its product offerings [3] - Turtle Beach's shares are traded on the Nasdaq Exchange under the symbol TBCH [3]