Corsair Gaming, Inc. (Nasdaq: CRSR) (“Corsair” or the “Company”), a leading global provider and innovator of high-performance gear for gamers and content creators, today announced financial results for the quarter ended September 30, 2022.
Third Quarter 2022 Highlights
- Net revenue was $311.8 million, compared to $283.9 million in the second quarter of 2022 and
$391.1 million in the third quarter of 2021.
- Gamer and creator peripherals segment revenue was $96.8 million compared to $89.0 million in the second quarter of 2022 and $139.3 million in the third quarter of
- Gaming components and systems segment revenue was $214.9 million compared to $194.9 million in the second quarter of 2022, and $251.9 million in the third quarter of
- Operating loss was $11.0 million compared to operating loss of $55.0 million in the second quarter of 2022 and operating income of $10.8 million in the third quarter of
- Net loss per diluted share was $0.09 compared to net loss per diluted share of $0.62 in the second quarter of 2022 and net income per diluted share of $0.02 in the third quarter of
- Adjusted EBITDA was a gain of $10.1 million compared to a loss of $11.0 million in the second quarter of 2022 and a gain of $27.6 million in the third quarter of
Definitions of the non-GAAP financial measures used in this press release and reconciliations of such measures to their nearest GAAP equivalents are included below under the heading “Use and Reconciliation of Non-GAAP Financial Measures.”
Andy Paul, Chief Executive Officer of Corsair, stated, “We achieved 10% sequential revenue growth from Q2 2022 to Q3 2022, while significantly reducing our channel inventory in what remains a challenging environment. Sales out levels from our Channel to Consumers were significantly above pre-pandemic levels in almost all product lines and were above the year ago level in many of our product categories.
As we mentioned in previous quarters, the self-built PC market has been held back over the past 2 years, as high demand for GPU cards from crypto miners caused GPU prices to rise and in some cases double. Now that Crypto mining can no longer utilize graphics cards as they used to, GPU demand has since normalized resulting in a decline in prices back to standard MSRP or below. We are already seeing the positive effects of this on the market.
Additionally, in recent weeks, there have been launches of new technology platforms from Nvidia, AMD and Intel, and this has immediately accelerated the self-built PC market. This is because our enthusiast customers can now build a better and faster gaming PC for a lower cost than they could over the last 2 years.
For gaming PCs built with these new platforms there is a need for faster memory such as DDR5, larger power supplies with 1000W capability or higher, and better cooling technology, all product categories that we are expert in, and have high market share.
For peripheral and streaming product lines, we are also seeing the market pick up, and while earlier in the year we saw consumer sales levels that were 15% to 20% down from last year, in the United States we now see a recovery to almost the same levels as last years as we move through the second half of the year. Europe is clearly a weaker market than the United States and Asia, since they have low consumer confidence levels because of the war and currency pressure have caused price rises in most consumer electronics products.
Longer term we expect to further benefit from the expansion in the gaming market’s number of active consumers during the pandemic, which we believe will drive a higher spending base over the next few years.”
Michael G. Potter, Chief Financial Officer of Corsair, stated, “We remain in a challenging environment in Q4 2022, with the strengthening of the US dollar against other currencies and continued weakness in Europe being headwinds for us. Worldwide channel inventory levels improved during Q3, removing much of the overhang from orders placed due to longer lead-times in prior periods caused by the effects of the COVID pandemic. We also reduced our own inventory by about 15% quarter over quarter, as we drive our inventory to more historic normalized levels. We are starting to benefit from the cost actions we announced last quarter, along with the success of newer products we recently released, which we believe will have a significant positive effect on margins moving forward, some of which we realized in Q3 2022. We are also encouraged by the improving supply chain environment, including a significant reduction in freight rates and supply chain lead times, which are rapidly approaching the same levels as they were pre pandemic.”
Financial Outlook
For the full year 2022, we currently expect:
- Net revenue to be in the range of $1.325 billion to $1.375 billion.
- Adjusted operating income to be in the range of $20 million to $30
- Adjusted EBITDA to be in the range of $35 million to $45
Certain non-GAAP measures included in our financial outlook were not reconciled to the comparable GAAP financial measures because the GAAP measures are not accessible on a forward-looking basis. We are unable to reconcile these forward-looking non-GAAP financial measures to the most directly comparable GAAP measures without unreasonable efforts because we are currently unable to predict with a reasonable degree of certainty the type and extent of certain items that would be expected to impact GAAP measures for these periods but would not impact the non-GAAP measures. Such items may include stock-based compensation charges, depreciation and amortization, inventory write-down charges and other items. The unavailable information could have a significant impact on our GAAP financial results.
The foregoing forward-looking statements reflect our expectations as of today’s date. Given the number of risk factors, uncertainties and assumptions discussed below, actual results may differ materially. We do not intend to update our financial outlook until our next quarterly results announcement.
Recent Developments
- Commenced sales of the CORSAIR VOYAGER a1600 AMD Advantage™ Edition laptop on the CORSAIR webstore and from distributors worldwide. The CORSAIR VOYAGER a1600 features state-of-the-art AMD processor and graphics for mobile systems working in tandem using exclusive AMD smart technologies, alongside CORSAIR and Elgato software and technologies, to create a gaming and streaming experience like no
- Launched the new XENEON FLEX 45WQHD240 OLED Gaming Monitor, a flagship bendable gaming monitor created in close partnership with LG Display. Boasting the latest in W-OLED technology, the XENEON FLEX OLED offers phenomenal image quality, excellent black levels and response times, with the ability for enthusiasts to manually adjust the curvature of its 45in 21:9 aspect ratio
- Unveiled the CORSAIR K100 AIR Wireless Mechanical Gaming Keyboard, CORSAIR’s thinnest high- performance keyboard From its elegant brushed aluminum frame to its versatile connectivity options for multiple devices, the K100 AIR delivers a modern, premium experience that meets the needs of gamers and productivity focused consumers alike.
- Announced the wide-ranging compatibility of CORSAIR’s PC components with Nvidia’s newly announced 40-series graphics cards, including the revolutionary RTX 4090. From power supplies able to drive the world’s most powerful gaming systems, to stylish and capable gaming cases and a huge array of cooling options and accessories, CORSAIR offers the hardware to power, house, and cool the world’s most powerful graphics
