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Corsair Gaming Reports Q2 2022 Financial Results

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Corsair Gaming, Inc. ("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 June 30, 2022. Andy Paul, Chief Executive Officer of Corsair, stated, "Headwinds from Q1 persisted through Q2, which is seasonally the lowest quarter for us, with macro-economic headwinds affecting consumer spending on gaming gear, especially in Europe combined with global inflation, the continued Russia and Ukraine conflict, and high freight costs. This resulted in a buildup of inventory both in our warehouses as well as in the retail channel, thus causing our channel partners to delay ordering while they clear this stock.

Despite the challenging environment, we continue to see positive underlying growth trends in the gaming hardware sector, and we see spending levels significantly above pre -pandemic levels. We are also starting to see more enthusiasts building gaming PCs again as graphics cards are now more readily available at reasonable prices. We saw very positive signs during Amazon Prime week, with component activity significantly higher than in 2021, both in Europe as well as in the United States. While we are disappointed with the lower results in Q2, we are very pleased to see positive market activity recently and with our channel inventory moving back into line during Q2 and Q3 2022, we expect demand for our products to recover well as we finish the year and look forward to an exciting 2023."




Second Quarter 2022 Highlights
  • Net revenue was $283.9 million, in line with the Company's preliminary revenue provided on July 21, 2022. Net revenue was $380.7 million in the first quarter of 2022 and $472.9 million in the second quarter of 2021. The sequential and year-over-year declines reflect the adverse impact of macro-economic headwinds affecting consumer spending on gaming gear, especially in Europe, and a channel inventory correction.
  • Gamer and creator peripherals segment revenue was $89.0 million compared to $134.1 million in the first quarter of 2022 and $155.2 million in the second quarter of 2021.
  • Gaming components and systems segment revenue was $194.9 million compared to $246.5 million in the first quarter of 2022, and $317.7 million in the second quarter of 2021.
  • Operating loss was $55.0 million compared to operating loss of $2.5 million in the first quarter of 2022 and operating income of $34.7 million in the second quarter of 2021.
  • Net loss per diluted share was $0.62 compared to net loss per diluted share of $0.05 in the first quarter of 2022 and net income per diluted share of $0.28 in the second quarter of 2021.
  • Adjusted EBITDA was a loss of $11.0 million compared to $15.4 million in the first quarter of 2022 and $51.6 million in the second quarter of 2021.

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."

Michael G. Potter, Chief Financial Officer of Corsair, stated, "We have already taken actions to adjust to the lower revenue level in the first half of 2022 and our expectations for the remainder of the year. We have proactively taken actions to reduce operating expenses and we have adjusted product ordering and took a $19.5 million reserve against potential inventory overhangs. We believe our business fundamentals remain strong with a positive long-term outlook, and we continue to believe the self-built gaming PC market will begin to accelerate in the second half of 2022. Despite the headwinds we have been facing, we have continued to invest in product development and have and will continue to release innovative and what we believe to be industry leading products."

Financial Outlook
For the full year 2022, we currently expect:
  • Net revenue to be in the range of $1.35 billion to $1.45 billion.
  • Adjusted operating income to be in the range of $35 million to $50 million.
  • Adjusted EBITDA to be in the range of $50 million to $65 million.

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
  • Unveiled Corsair's innovative first gaming and streaming laptop, the CORSAIR VOYAGER a1600 AMD Advantage Edition. Combining a powerful AMD Ryzen 6000 Series processor, AMD Radeon RX 6800M mobile graphics with CORSAIR and Elgato's vast ecosystem of exclusive software and technologies, the CORSAIR VOYAGER a1600 AMD Advantage Edition laptop was designed for aspiring content creators, avid gamers, full-time streamers and more.
  • Announced VENGEANCE RGB DDR5, the newest addition to Corsair's lineup of cutting-edge DDR5 memory optimized for the latest gaming PCs and workstations to deliver sensational DDR5 performance with stunning RGB style.
  • Announced it is working with NVIDIA to integrate key features from NVIDIA Broadcast into CORSAIR iCUE, Elgato Wave Link, and Elgato Camera Hub software. For owners of NVIDIA GeForce RTX graphics cards, NVIDIA Broadcast AI effects enhance microphones and cameras in real-time to improve the gaming, streaming, and video conferencing experience, all controllable from CORSAIR and Elgato software interfaces.
  • Expanded its CORSAIR XENEON family of gaming monitors with two new additions: the CORSAIR XENEON 32UHD144 and XENEON 32QHD240, with stunning UHD 4K resolution gaming or QHD at an incredibly smooth 240 Hz refresh rate, both monitors deliver the beautiful design, brilliant display, and innovative technologies.

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Am I reading this report right? They seem to have losses for the last 2 quarters. And even Q4 2021 was not that great on the EPS side.
 
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Am I reading this report right? They seem to have losses for the last 2 quarters. And even Q4 2021 was not that great on the EPS side.
Pretty much, yeah.
 

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Am I reading this report right? They seem to have losses for the last 2 quarters. And even Q4 2021 was not that great on the EPS side.

Corsair have been rough for a very very long time, maybe as far back as even 2015 when the first rumblings started coming out that they were looking for a buyer. Either the market got too competitive and they couldnt adapt and overcome or the quality of their products dropped and/or they stopped bringing out newer products that were good and competitively priced.

Lots of articles about their financial difficulties and looking for a buyer for the business have been scrubbed from the internet though it seems. I remember reading a fair few articles about their search for a buyer last year but google doesnt show much about it.

Only thing i can find is a 2017 article about them having a possible buyer though im not sure if that deal followed through.


Though with that said....

"The Independent Director Of Corsair Gaming, Inc. (NASDAQ:CRSR), Samuel Szteinbaum, Has Just Spent US$1.1m Buying 51% More Shares"



It seems that a lot of investment firms are buying up shares in corsair currently. So something is definitely happening...


Might be a good time to buy some shares

1659713831715.png
 
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Their stock on the stock market began showing from October 2020, that's fairly recent. You should also have in mind that the whole stock market has lost a ton, including very good IT companies, so corsair being down is no surprise at all. Especially given their woes for the last 5 years, I would actually expect it if anything and not be surprised by it (given the situation of them trying to find a buyer).
 
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When all you have for engineering chops is just pasting your brand onto OEMs and hoping for the best...Good luck IMO.
 
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When all you have for engineering chops is just pasting your brand onto OEMs and hoping for the best...Good luck IMO.
That's not at all what Corsair does, regardless of what you think.
That said, they could do with some people that had some fresh ideas.
 
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it's not because of the invasion, it's not because of the competition. What made Corsair lost so much was the lack of decent, affordable products, their software is full of useless bloat that no one uses, streaming related products is too niche (and expensive), lackluster quality on certain "premium" products and whatnot.
 
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Holy sh**

I guess it was the first time me seeing a proper comma before double and :D
 
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Their own fault IMO. Shouldn't have gotten so expensive, shouldn't have gotten propietary crap for their pc components, etc.
 

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Only thing that is good from corsair are PSU. Anything else in my opinion is meh.
 
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They do make a lot of decent stuff, however I like this

"Headwinds from Q1 persisted through Q2, which is seasonally the lowest quarter for us, with macro-economic headwinds affecting consumer spending on gaming gear, especially in Europe combined with global inflation, the continued Russia and Ukraine conflict, and high freight costs. This resulted in a buildup of inventory both in our warehouses as well as in the retail channel, thus causing our channel partners to delay ordering while they clear this stock."

No mention on competition or product pricing. Some things such as their RGB fans, a 3-pack in Canada is $120, while a 3-pack of bitfenix is $40. I have no idea if there is that level of quality difference justifies it as I have never read reviews or anything, but for budget conscious people that 3x cost would have to be justifiable somehow.
 
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That's not at all what Corsair does, regardless of what you think.
That said, they could do with some people that had some fresh ideas.
In my opinion, Corsair is in an overcrowded space and it is struggling to differentiate themselves from competition. I am not sure if they did ok/ well during the pandemic period, but most big players like Asus, MSI, Gigabyte (to name a few) are also joining the party of offering gaming monitors, mouse, keyboard, PC fans, PC case, full PCs, etc. Which I think further dilutes any advantage that Corsair offers. From here, I feel there is a higher chance for them to slide further than gain any meaningful traction. If Q1 and 2 are bad, I don't think Q3 will be any better. Q4 should generally generate the most sale but I suspect it will be comparatively weaker as compared to last year. I feel some consolidation may be necessary.
 
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In my opinion, Corsair is in an overcrowded space and it is struggling to differentiate themselves from competition. I am not sure if they did ok/ well during the pandemic period, but most big players like Asus, MSI, Gigabyte (to name a few) are also joining the party of offering gaming monitors, mouse, keyboard, PC fans, PC case, full PCs, etc. Which I think further dilutes any advantage that Corsair offers. From here, I feel there is a higher chance for them to slide further than gain any meaningful traction. If Q1 and 2 are bad, I don't think Q3 will be any better. Q4 should generally generate the most sale but I suspect it will be comparatively weaker as compared to last year. I feel some consolidation may be necessary.
Yeah, they're getting more and more competition and not coming up with unique enough products of their own.
I guess they believe they can sell on their name alone, but that's no longer the case.

They don't even sell anything else now. Didn't see Corsair keyboards in retail since few years
Where do you live? Saw a bunch of them in retail just the other day.
 
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