Corsair Gaming, Inc. Q3 FY2025 earnings call

• Q3 was a strong quarter with double-digit revenue growth and profit expansion. Latest product launches like the Vanguard 96 gaming keyboard, Saber Pro FPS mouse, and Valor Pro Premium controller were well-received. - Components and Systems segment revenue grew over 15% YOY driven by demand for high-performance PC builds, NVIDIA 5000 series GPUs, high-wattage PSUs, etc. The Air 5400 chassis launched and DDR5 memory broke overclocking records. - Elgato brand continues to drive the creator ecosystem with Stream Deck adoption and marketplace growth. - M&A integration with Fanatec is progressing, expanding product roadmap and global reach, with SimRacing seen as a multiyear growth driver.

In the third quarter of 2025, the Gamer and Creator Peripherals Segment contributed $112.7 million in net revenue compared to $102 million in Q3 2024. For the first 9 months of 2025, it grew to $327.3 million from $303.2 million. The Gaming Components and Systems Segment had net revenue of $233.1 million in Q3 2025 vs $202.2 million in Q3 2024. Memory products within this segment were $117.2 million in Q3 2025 vs $97 million in Q3 2024. For the first 9 months of 2025, the Gaming Components and Systems segment revenue increased to $708.4 million from $599.6 million, with memory product revenue up to $363.2 million from $303.6 million. Gross profit in Q3 2025 increased 33.6% to $93.1 million, with gross margin at 26.9% compared to 22.9% in Q3 2024. The Gamer and Creator Peripherals segment gross profit was $44.3 million in Q3 2025 vs $39 million in Q3 2024, with gross margin at 39.3% vs 38.3%. The Gaming Components and Systems segment gross profit was $48.8 million in Q3 2025 vs $30.6 million in Q3 2024, with gross margin at 20.9% vs 15.1%. Memory products in this segment had a gross margin of 16.8% in Q3 2025 vs 10.7% in Q3 2024.

• Full year 2025 net revenue expected in range of $1.425 billion to $1.475 billion. - Adjusted operating income expected in range of $76 million to $81 million. - Adjusted EBITDA projected between $85 million and $90 million. - Conservative outlook for Q4 due to tight DDR5 memory market. - Gaming and Creator Peripherals expected to grow high single digits in 2025. - Anticipate exit 2025 with solid YOY improvement in EBITDA margin.

• Unforeseen tariff costs of $12 million since May. - Tight DDR5 memory market affecting upside expectations. - Regional market variations with North American business lagging other regions in Q3.

Q: As it relates to guidance, any more color on estimated consumer spending patterns and trends through Q3 and into October?

A: Thi La noted consumer spending on DIY components and systems first, with Gaming Peripherals and Creator segment spending delayed to Q4 and 2026. North American market grew single digit vs double digit in other regions.

Q: On memory, any visibility into how long tightness could last and mitigation plans?

A: Thi La said DDR5 memory tightness expected late 2025 and first half 2026, with actions taken in Q3 to invest in inventory. Conservative outlook due to market tightness.

Q: Color on conservatism in memory guidance, worst case/best case?

A: Thi La said memory contributed meaningfully to Q3 revenue, conservatism stems from not assuming upside yet despite healthy demand.

Q: Clarification on tariff costs, anticipation for balance of year and 2026?

A: Michael Potter said $12M unmitigated tariff costs for 2025, with mitigation of almost all impact, and focus on margin portfolio and efficiencies.

Q: U.S. business lagged other regions in 3Q, thoughts on holiday quarter?

A: Thi La said North American market grew single digit in Q3, still performing better than market, focusing on gaining market share.

Q: On Elgato and Nintendo Switch 2, trends in Streamdeck or Capture Cards?

A: Thi La said Elgato 4K Capture Card launched in June saw double-digit growth with Switch 2, Streamdeck also doing well with double-digit POS growth.

Q: Divergence in growth between game titles and hardware sales, and GTA VI impact?

A: Thi La explained difference between game software revenue and hardware DIY sales, with NVIDIA 5000 series launch driving Components and Systems growth, and GTA VI expected to drive next hardware sales acceleration.

Q: Thinking about SimRacing opportunity differently post-Fanatec integration?

A: Thi La said expanding product roadmaps, entering new categories like coaching and performance tracking, and verticals like Flight sim and farm sim as new opportunities post-integration