Turtle Beach Corporation (TBCH) Q3 2025 Earnings Call Transcript
Revenue $80.5 million, in line with expectations, reflecting solid execution against strategic priorities despite challenges in the gaming accessories market.
Gross Margin 37.4%, a year-over-year improvement of nearly 120 basis points due to cost optimization initiatives and tariff mitigation strategies.
Operating Expenses $24.7 million, representing 30.7% of revenue compared to $27.7 million or 29.4% in the prior year period. The reduction was driven by lower sales and integration-related activities, partially offset by investments in internal systems and infrastructure.
Net Income $1.7 million, which includes a onetime noncash write-off of $1.9 million for previously capitalized fees related to refinancing.
Adjusted EBITDA $11 million, reflecting strong performance at the current revenue level.
Cash Position $12 million as of September 30th, with total debt at $90 million, resulting in net debt of $78 million.
Interest Savings Annual interest savings of over $2 million due to refinancing, which lowered the term loan interest rate by approximately 450 basis points.
Share Repurchases $10 million of stock repurchased during the quarter, bringing year-to-date repurchases to $17 million, demonstrating confidence in the business and commitment to shareholder value.
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Roth Capital Reaffirms Buy Rating for Turtle Beach, Adjusts Price Target to $20
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Turtle Beach (TBCH) Falls Short of Q3 Earnings and Revenue Projections
Earnings Performance: Turtle Beach (TBCH) reported quarterly earnings of $0.08 per share, missing the Zacks Consensus Estimate of $0.15, and showing a decline from $0.16 per share a year ago. The company has surpassed consensus EPS estimates twice in the last four quarters.
Revenue Results: The company posted revenues of $80.46 million for the quarter, slightly missing the Zacks Consensus Estimate and down from $94.36 million year-over-year. Turtle Beach has only topped revenue estimates once in the last four quarters.
Stock Outlook: Turtle Beach shares have decreased by 8.3% since the start of the year, contrasting with the S&P 500's 15.6% gain. The stock currently holds a Zacks Rank #3 (Hold), indicating expected performance in line with the market.
Industry Context: The Computer - Peripheral Equipment industry ranks in the top 11% of Zacks industries, suggesting a favorable outlook. Investors are advised to monitor earnings estimate revisions, which can significantly influence stock performance.
