Turtle Beach Corporation Q4 FY2025 earnings call

Cris Keirn mentioned navigating external pressures like tariff impacts and market softness, made operational progress, gained share on Turtle Beach headset brand, and looked ahead to game launches like Grand Theft Auto 6. Highlighted 2025 achievements: implemented cost optimization for gross margin expansion, navigated tariff environment, strengthened balance sheet via refinancing and share repurchases. Also discussed strategic assessment of acquisitions, capital allocation priorities, and board updates

Fourth quarter net revenue was $118 million, down 19% year over year. Fourth quarter gross margins reached 40.1%, up nearly 310 basis points year over year. Full-year 2025 net revenue was $319.9 million, down 14% year over year. Full-year gross margins were 37.3%, an improvement of 270 basis points year over year and the highest annual level since 2018

Expects 2026 full-year revenue to be in the range of $335 million to $355 million, up 8% at midpoint from 2025. Full-year 2026 adjusted EBITDA expected to be in the range of $44 million to $48 million. Anticipates majority revenues in second half, with first quarter expected to realize 13%-14% of full-year revenues, double-digit revenue growth in second quarter

Risks include industry dynamics changes, potential product launch delays, supply chain issues like memory shortages that could impact console refresh cycle and thus business performance

Q: Anthony Stoss asked about racing sim products and 50% more products in 2026, and guidance related to GTA 6.

A: Cris Keirn responded on racing sim performance, product launch across categories, and GTA 6 impact on 2026 guidance.

Q: Martin Yang inquired about cost structure for 2026 and new product pace sustainability.

A: Cris Keirn talked about gross margin expectations, OpEx structure, and sustainability of new product pace.

Q: Sean McGowan followed up on gross margin, G&A spending, retail inventories, and timing phasing.

A: Mark Weinswig and Cris Keirn addressed gross margin outlook, G&A spending, retail inventories, and timing phasing.

Q: Andrew Crum asked about leverage threshold for share repurchases and drivers of optimism beyond GTA 6.

A: Cris Keirn mentioned leverage range and multiple factors driving optimism.

Q: Jacques Vandermeerade asked about pricing/promotional strategies and EPS read-through.

A: Cris Keirn and Mark Weinswig responded on pricing, promotions, and EPS expectations