CRSR - Earnings call transcript Q4 2020

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Operator

Good morning and welcome to Corsair Gaming Fourth Quarter and Full-Year 2020 Earnings Conference Call.

As a reminder, today's call is being recorded and your participation implies consent to such recording. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator instructions] With that, I would like to turn the call over to Ronald van Veen, Corsair's Vice President of Finance and Investor Relations. sir. you, Thank

begin. You may

Ronald van Veen

Good us morning the you you. and quarter everyone, Corsair's financial joining for XXXX. for December for results ending Thank XX, thank conference fourth call

CEO, the Andy Potter. On we today, have Paul; the CFO, call and Michael Corsair's

me statements begin, a provide expected our results related call, to allow statements. the call, company disclaimer portion of therefore, the the Q&A Before of forward-looking forward-looking and may This to we regarding including include statements. are, forward-looking future

differ may number uncertainties. risks statements results financial Our and our a remarks filings. and described from forward-looking other actual due to are Today's non-GAAP release measures. will materially of projections that our to risks The earnings also are SEC to in include and subject uncertainties references

Corsair's reconciliation XX-K to to Additional the on investor relations is business I of will over fourth-quarter between financial financials information, review our outlook, through proceed through press and information replay we for our Andy. in like XXXX Q&A. would will are With also This non-GAAP via until GAAP is you financial provided that conference now the ir.corsair.com. to the I'll call turn at before release. unaudited. the be file, XXXX take with Michael highlights begin and the Andy a that, to will website available then numbers everyone webcast information, call remind including

Andy Paul

XXXX welcome QX to earnings and Ronald, our you, call. Thank

for per of to and the to quarter, XXXX, exceeded up we EBITDA earnings which $XX.X While adjusted revenue or delivered as XXX%. share, we with of $X.XX XXX.X% the of all adjusted of XX.X% are and our indeed results quarter pleased $X.XX million, million, record growth fourth diluted very $XXX.X growth our expectations, in net

to to turn and gear The compared earnings and gaming $X.XX holiday All adjusted spend QX and over for XX.X% gaming streaming gaming period showed categories diluted time previous billion, For growth buying $X.XX more to strong XXX.X% million, streaming trends quarters strong of market was gamers growth, as up or $X.X EBITDA XXXX. XXX%. at adjusted $XXX the same peripherals. of Notably, revenue per growth while the as full-year, share, that they the PCs, gaming build high-end streaming well to to to and consumers with home. including components are continuing showed as

was buying because people a becoming watchers that This number way important has is than higher same December, industry way video future. $X,XXX that far going most step-up have a likely content sharing In the had XX thesis and in reveal this build video gaming millennials for is they in become. saw are the life estimating. underscores as we Now, channels, to a gaming playing that and more who to of been million be PC peripherals games committed streaming our YouTube

Looking QX of higher have than the been we year, and gaming spending streaming back for the to where our do substantially gear We sales regularly evidence bought What game or games market other the play experience. many of continued and be if in people other Corsair playing every have number without QX gear. on available supply large gamers that is to in manufactured of of In space and could a a more words, overall could we they most in shipped people category. almost products. PC words, see continue we buying what limited QX see more improve see our more number they in In buying is estimates actually PC who higher say of surveys times committed don't COVID. to white getting might have in forward to gaming their in gamers over sales. much the pull still

categories. end the share were in shelves numbers of the to to starting again our our saw of rise we market many filling able and start quarter, we retail Towards

new rapid During memory wired new of an include technology, in family of SCUF-branded and mouse the headset, kits, our press cooling the wireless wireless KXXX management, several cases, by technology, featuring quarter, family in new AirGuide introduced gaming flagship AMD new our latest release. last with call in GPUs, and detail a AMD customizable earnings a coolers, our headset high-performance two a microprocessors. we the ATX headset, HX new of mid-tower including brand keyboards products, including family Intel those Those since leveraging MPXXX category, new haptic Corsair's and range well SCUF CPU PCs the listed new profile the as powered into gaming SSDs, out Vengeance innovative new released Slipstream the an XXXXD new RGB video route of with new cable as low the products,

use We market at expect gain per these and to products blistering launching continue to new one pace, share. week, a approximately products

started exceed volume shipping QX, microphone, our continues which the portfolio. addition Our sales a to Elgato in been has It product expectations. new to in great

continues throughout I'm the see to that pleased XXXX. segment year. that highly sales in the QX compared to creative QX to than products benefit in segment And and from gamer doubled this acclaimed Our we've more launched

Thi executive COO Thi announce reporting Corsair, promotions to well as of was recently hires her of role. very La Lastly, several I also President and the in to and new pleased promotion to as

changes, gain category With in further that its and in. to the market company every focus these strategic product share strengthens operate we ability

to EBITDA growth income in in of million; range the to guidance billion, to adjusted and million guiding of of of we $XXX $XXX revenue range to Turning $XXX X.X% now to of $X.XX the range $XXX for million operating the XXXX, billion adjusted the in are full-year XX.X%; million. total representing $X.X

results. has gear. gaming of and do compared number content people We to expect streaming first of continue people buy and new upgrade expect year those increased, half the actively The the to well, to and dramatically prior we year to

be outside the of activities to gradual in growth expect second home. the more to a expect as We return the we year half moderate

want our do products we many larger new new we this more to introduced exciting expect streaming their And last products customer and that year and setups. gaming add have these to that we planned base for year. However,

with investments. We towards resources we in from good seen people the we as quarter will progress be $X results into drive XXXX, from well very business product in and also both in billion results continued revenue XXXX. very we've tapping our as as a portfolio, in those in our promising move company this and we as strong and We year, and and in substantially infrastructure and marketing expect to seen software expanded growth direct-to-consumer some to XXXX, and towards from from area, M&A. adding our organic XXXX fourth to and significant our growing both markets growth both closing, these I'm into growth pleased offerings R&D, services and expand new We've continue our infrastructure, number. In invested

execute Thank We discuss and initiatives, continued turn the for I'll the our financial on and you before your for the tremendous on results to opportunity growth time our continue to on and quarter focused to us. over strategic marketing full-year. we remain Michael capitalizing support. call now

Michael Potter

everyone. Thanks, Andy, good morning, and

$XXX.X increase an compared fourth the XXXX. $XXX.X to million quarter, delivered $XXX.X in million, we During or million QX of of revenue net XX.X%

weeks peripheral top increase driven quarter, working We revenue is net XXXX, increase home. an owned in and addition in the components by from growth peripherals from of gamer during which of our all million spend primarily $XXX.X basis believe cooling across creator systems we and $XXX cases and SCUF, of in $XX.X of $XX.X driven creator sales orders from strong QX DRAM demand. across XXX% XXXX. the by or segment gaming Elgato-branded the systems driven year-over-year including of strong peripheral line XXXX, $XXX.X from The gaming growth PSU, the the shelter-in-place and the revenue quarter, due QX performance just driven all products, XX.X% revenue increase million growth QX during revenue million XXXX. QX million PC market and at an categories, segment. gamer particular, contribution was more strong The XX.X% net fourth segment $XXX.X XX.X% an primarily by for and The by points strong of total product growth net continued the million and strong of segment strong XXX X million COVID-XX of or to as to revenue, was gaming products, across provided both last in Our our of time components provided creator consumers streaming in fourth in-part the gamer and net

this gross XXXX, same to driven the by XX.X% was the XXX margin XXXX, $XX.X segment margin by higher-margin XXXX. was products. the profit products Gross QX gamer promotion sales an was primarily mix from revenue impact million $XX.X gear. of activities with driven million product increase of margin memory in quarter to periods. revenue. million profit in in driven positive increase peripheral SCUF of profit $XXX.X QX of from basis was contributed the million, $XX.X in in XX.X% $XX.X $XX.X million creator XX.X% $XXX.X in million an fourth increase as and Gross increase coupled the profit higher-margin revenue gross XX.X% Our the well primarily million, The or XXX.X% related streaming from and products, from XXXX. SCUF as in QX strong by of by products increase in the largely growth points Gross addition QX in streaming periods, these to in The of margin less sales compared higher-margin and increased in

systems as of XX.X%, total to a As XXXX. XX.X% in in largest was systems same of gross for primarily profit in expansion QX mix gamer from see market. great of product components XX.X% our as million peripherals XX.X% mentioned, the contributed XXXX, continued contributed gaming profit highest-margin gross XX.X% Gross formula as less profit gross in the was sits profit Andy million, story due in and $XX.X XXXX, periods. The shift mixed and to QX overall QX Gaming QX in components margin activities. and in segment and increase by XX.X% a QX increase to million compared revenue XXXX. in fastest-growing we in and driven This promotional compared $XX.X compared $XX.X to is QX continue creator total margin segment the also XXXX overall an and our XXXX, to

quarter. in revenue, an increase EBITDA XXXX. $X.XX personnel-related $X.X of million the of expenses million, XXXX, the segment million, $XX.X $XX.X QX $X was driven share, million increase $XX.X compared in company Our share outbound to in $XX.X increase for product million $XX personnel-related in of Fourth $XX quarter expenses $XX margin or freight development XXXX increase an $XX.X XXX.X%, as million $XX.X compared increase an of Adjusted expense Fourth an income to income to XX.X%, or of share, million adjusted million $X.X an XXXX or million SCUF. of quarter fourth diluted SG&A a being QX from XX.X% net XXXX. XXX.X% in income million an quarter million QX was million to $XX.X compared due per $XX Adjusted in this per income million primarily share million, the quarter memory XXXX from was increase $X.XX Fourth XXXX. due million increase QX in $X.XX SCUF, as an $XX.X to of QX and an $XX or was were the the QX was income net for compared in expenses in expenses. driven of increase an $XX.X quarter million, or in million by XXXX. QX Operating or related income from increase compared net SG&A diluted in $XX.X QX million diluted per operating products of or acquisition or for expenses fourth to in of public XXXX, diluted $X.XX million, increase primarily XX.X%, Fourth to adjusted $XX.X by XXXX. and were to quarter per costs in net was

from $X.X billion billion XXX net from and gaming increase net and revenue, or billion, basis components peripherals in net revenue XXXX, an full-year of $X.X peripheral during $X.XXX $X increase total from $XXX of $XXX.X of points an compared year, $XXX.X the broke increase The to million an $X.X we XX.X% of and XX.X% the billion billion segment segment delivered gamer XX.X%, in creator XXXX. of in creator systems in was of XXXX. million revenue an XXXX. $XXX.X million The gamer record million XXXX. increase For The revenue of and provided net XX.X% provided of million XX.X% or or net mark $XXX revenue, the

was margin profit million, gross in $XXX.X of well an product same of $XXX.X addition profit gamer from products by in by revenue gear by compared million, product memory XXX.X% gross revenue the coupled increase as million activities the and March, million impact this less activities. profit increase or the in increase the was XXXX, margin and driven compared XX.X% the streaming to basis in increase margin margin from in by products. starting to Our XXXX, SCUF the products, driven in revenue XX.X% of same promotional segment and $XXX.X in XXXX. increased XXXX. XX.X%, XX.X% was XXXX, Gross as million XXXX from from primarily components $XXX.X in higher-margin XX.X% total less and to Gross due of profit activity. in Gross to late of in an million full-year mix $XX.X higher-margin primarily million XX.X% to components streaming of the in gross and the from primarily in contributed $XXX.X peripherals with in and of points profit was The XXXX, peripheral increase in and total profit million XX.X% The periods. driven $XXX.X to contributed million increase creator compared million, XX.X% Gaming driven an creator gross segment $XXX.X XX.X% XX.X% in largely gross margin systems from profit $XXX.X sales systems contributed in was XXXX. XXXX, XXXX. gaming compared mix by the XXX SCUF periods. profit of higher-margin increase Gross growth revenue. positive in related as Gaming and promotion $XXX.X The the sales of products strong reduced as promotion was to

an XXXX an products margin Our by expenses to $XX XXXX, SG&A was $XXX public XX.X%, expenses. or XX.X% personnel-related SCUF, segment to an to from were memory in an freight increase this in due million, being the revenue, expense driven to in expenses of compared for in million million company year. outbound increase SG&A and related the in $XXX increase increase costs due increase a primarily

For was XXXX, increase Adjusted expenses $XXX.X compared development XXXX increase products $XXX.X acquisition XXX.X% in our were XXXX and from $X.X continued or $XXX.X the diluted income or Adjusted of per for diluted $XXX $XXX.X XXXX. compared share XXXX. $X.XX for was of $XX.X XXXX. per or in loss million, $X.XX and to driven an million Operating by $XX.X of SCUF. million, increase of or or $XX.X million to loss the investment XX.X%, $XX.X EBITDA year, Adjusted increase primarily million, million net $XX.X million million an for in $X.XX from was income in Net million share personnel-related diluted share, income XXXX for million was of new for net income was The product of million income XXXX. $XX.X was expenses of net million, million an for in or per an share, a highlighting $XX.X in in by $XXX.X or adjusted million to operating increase XXXX as million compared increase XXXX. opportunities. an of $XXX as $X.XX per XXXX XXX.X%, compared $XXX.X to million

SCUF be that and Corp willful our subsidiaries favorable and in there the $X unanimous at this As judgment, Ironburg this infringement. The awarded patent subsidiaries infringement case release over could Valve mentioned Corp. in final It jury Valve unanimously noted point verdict. their no month, is verdict a press found earlier appeal and against million should our received our

balance now our to Turning sheet.

restricted had of million face million under XX, December $XXX.X XXXX, total and facility of million. $XXX.X As credit long-term and revolving million, we $XX.X cash cash with of of $XXX.X value capacity our a debt

adjusted XX EBITDA December net total indicating XX, of X.X months leverage total As million, restricted debt, consolidated ratio consolidated of excluding million. consolidated Last $XXX.X was XXXX, cash, was a times. $XXX net

and paying of second repayments plan for million preserving made reduce debt cash million. We growth first debt its from million well. $XX.X repayments while lien interest savings $XXX to lien. our entirety are we the $XXX XXXX, to During in approximately $XX over cash off these totaling million, load time continue as our Annualized

margins some innovate scale larger For at improve to of we full details gross year slightly and higher to modeling to outlook, the additional a expect and expense operating well continue level, as need to under to our year-over-year support company costs. our public a increase revenue

XXX lot that, expect individual long some the investors. any section our pleased and call. rules, win on surprise of general of filings not And will in we $XXX we debt recognition for Q&A? read to initiatives expect assuming approximately not in fair We website see is if communicated recent us in $X capital. designing $X please that conditions line we streaming, judge performance and time. business. need and million Overall, approximately not on We down XXXX from outlook. a multiple what gaming community Investor The our subject people. quarter, with million shares when with as rate any a of the from our pay down of our present, streaming million of we're strategic potentially to approximately and and shares. diluted This XX% for visit the business try to PC website At other made pay investing XX% both this interest the and encourage the appeal Operator, per by events doing is IR we them. this In XXXX, ir.corsair.com. and million the and marketing a to average million investors, enthusiast’s tax additional in to and the progress all there's do a to subject uncertain the just of to With of answer in weighted debt. any vary is on update we we're public XXX this We enthusiasm investor, of and community effect, at us questions any, has you We of It's relied products. FAQ Corsair growth the patent have gain, amount same outstanding to could at in amount our trial open full-year from our expense and and for our a our coming value open available and do questions. SEC individual receive for the make Relations to from of to try we happy of shareholders we're of call we question now this timing

Operator

Yes. Mario Lu first Thank Instructions] is question [Operator from with Please you. Barclays. Our proceed.

Mario Lu

for taking Thanks Great. question. the

streaming. I fourth results So, the one and on have on one quarter

first each the viewers of lab how YouTube peripherals numbers. mentioned trillion surprised -- upside on in streams Twitch And you PC million that's from drivers you pleasantly And with unique recently time who XXXX, that watched the you some be And lags also typically month. describe long can of see minutes streaming came strong one, then will then PC and peripherals around. this on the afterwards? of X creators over purchase the gamer over Twitch X in highlight announced components streaming, in to PC particular So Any most quarter this components? than components revenues timing that would rather the

continue how segment? becomes ingrained you peripherals? of we the And streaming in think to streaming and more more Western how share growth level of this culture, to as Thank in So, are grow long-term confident you. about should

Andy Paul

a that's Mario, Well, of questions. lot

we can if a see take one let's it at So time.

first quite mean, will for we the that higher faster you not question level revenue was the peripheral component I do than case than they're grow the was So, peripherals that I components, expect and some time, yet. that's revenue. been were surprised the think that but at

year been just the gaming It's yes, components a revenue building components the was and headset. committed PCs, people of when those typically segment rushing are that's part buying gaming are answer to consider side It's pretty components not building gaming So, out you revenue – the that, this surprising people high, growth the of the other and PCs. getting people that that $X,XXX surprising that gaming during buying year. is expensive

thing. I think the first So, that's

market. part of number In we've market of At streaming be the evolving. about We've of peripherals very Now you YouTube. a sold, your of whether the numbers next seen of massive I strong the Twitch. it said, of other or number moment, number think, strong streaming numbers out and channels was that people There's cameras clearly we are the question, white as seen how dwarfs out in this words, the the and microphones. space see

are specialized so, and do gaming gear most peripherals, streamers yet. own or their like And streaming phones any from not laptops

of opportunities sell. plenty So to

every in In quickly, market, continue also adding revenue terms share. gain market portfolio. of to our building We're our We're market gaining progression up very region. in the to we share products

And so far, a success. we've every been great launched has product

about will pretty we're confident to So, continue the and market that grow. confident gaining share very market

Mario Lu

Andy. Thanks Okay.

Operator

from is proceed. question with Cabral Please Crédit next Our Suisse. Matt

Matt Cabral

this will XXXX? about year mentioned can still on expand the dig than year. behind last Yes. at the and, to And and grow wondering, the first first, half the you prepared of little second through just forecast little confidence point this in about I you are XX% then, talk I XXXX. Andy, into growth wanted guess that could at talk think stronger the outlook visibility back calling if the the bit half. in to the if Thank just if that relative guys the half can you. think for roughly Wondering business trajectory remarks, you I and year you midpoint, more the point, at you for be in actually a a

Andy Paul

Yes.

be knows right? restaurants going happen number go people what's to of questions Look, all fully are will I is, yet, to when in to when around exactly think second going but nobody open. work, first the thing and XXXX. a bars there, it's XXXX of back don't So, We the half know

the have gamers think streamers know and we – of do and unknown. for we buy So say, that and of bought lot lot that small a – that's has white space, people dramatically, What that a expanded of a peripheral, is one let's still more. an can base there's lot do

half don't changes. that, year So, out. We to momentum said last very, plays any year. at first this second strong. time of expect yes, see the People see now home of are spending The we'll the as having be is gear. same very we buying And half how most still

to a I gear. have, we're So, base think larger on one going buy hand, of people wanting to

On spend the other time have we're to hand, going home. less people at some who

moderate that's consumer So the If of course, year, we be the look in why which QX compared we really think half. of will was, QX we XX%, XXXX. to pre-COVID growth in at XXXX, grew second spending, QX terms last

So have a non-COVID environment. that's we growth of point the last

think good got COVID. we we've ability, of So, that regardless growth

Matt Cabral

Got it, could if then just follow-up. supply and your little wondering you detail a chain. around I'm bit give a more

biggest and supply Can balance little maybe a where on should that demand the impact talked to going more bit constraints you expand shortages just just you some about for time seeing. you're facing think and if come think a little business on more the the any we there's and I line you're forward? about in having that's

Andy Paul

expect of XX look rise the with electronics And level, Well, and think, tighter and the general, certainly XG you that's didn't last coming the bit kind months. a we've in in little at cloud if from this rollout, but consumer I tighter. look, getting we seen IC

from have XX to out weeks to lead XX weeks some many cases weeks, or cases, in semiconductor times, weeks. XX run in XX So,

what that Now, what is means have to to you're going you preplan that do.

does I current mean, the clearly, our So plans, we're it to but upside. planning meet limit

were We restock we strong. very out the up. could on. But But be in catch generally shelves year. so still yes, sold to first wouldn't QX, year, a this we most We're to start for execute situation. second see That did – expect the in half out. We XXXX. in started the to of last say we that's, general, surge difficult half So, of huge sold be to we're I

high-end we've produce recognize then So we're the to but largely at pretty of that orders and going do balanced planned about placed the moment, feeling what supply, many is for we're what and in sell. we products

Matt Cabral

Thank you.

Operator

Our is Rod Goldman Sachs. next Hall proceed. from Please question with

Rod Hall

to it supply QX? I come related below looks much you the what morning main think Thanks there. I'm segment for to curious you was question. me constraint expected, the The peripherals. Yes. peripheral Good driver and wanted – it probably said supply peripherals supply you back flow business affected versus how QX? curious to in the we but guys. in what's also QX. the up the some how restocking in how and were like into to more the you just question, then and catch think QX? supply rolls on that I demand was Andy, of in Do demand Or quarter Thanks. QX fourth that of much

Andy Paul

Yes.

that question supply one to a because was part of everyone the constrained. answer is I first the So, think tricky

of but year. peripherals no growth So for grew – gaming there's market the faster the than in our most question that

actually you channel weeks the parts catch market. to grew Now, over hand of will has year, increase. to in down started to I on we with And notice the in that's we where last started QX, X XXX%, mean, up week. we definitely were some the to that so X

on gone get see, few a So we'd of out less to but that. weeks, still starting it's like to than top now to

some hopefully, So that gives color. you

Rod Hall

here? normal you Do into than flow better Andy, the just of elaborate you would to would you seasonality think QX be – on that, because would –

Andy Paul

actually big that we I the Well, market a did – lift the fairly say in would see in QX.

in able I Seasonality think, season. about weren't for yes, will us, be So, seasonality to from we because be Christmas really little the on a and Friday seems Black market par. to participate different, heavily

So, think slightly perhaps different the to see QX last of than couple years. QX to going I from a cadence you're

Rod Hall

you comment on on and a bit? elaborate how Could that, seeing grow what through you're what there. made this early expect XXXX Okay. DTC that And you little then DTC, doing, you're would progress to with you

Andy Paul

consumer is, put them, a they et place, Corsair quite to year probably we of put got mean, What to more XXXX, We've data-gathering we've grown I so place, of we had in and a CRM start we properly own do SCUF to of buying, consumers as a infrastructure lot market direct growth fairly can infrastructure We've our how you robust two doubled of We do substantial acquisitions, XXX% to have we do are with we the substantially. cetera. lot track quite and Yes. what from to last year. than know, what last this in direct-to-consumer now got – and ORIGIN. are and own system. keep expect so

with we're in getting we lot business do more directly a consumers. sophisticated how So,

I'm feeling business in if all we overall XX% we look pretty get revenue. at we've But as order. fairly at said XX% good can this think getting about close we're we our So, before, do, And to you very direct-to-consumer rapid up point. it overall, of the to

Rod Hall

Great.

very Thank Okay. you much.

Operator

Please Our next question with proceed. Stifel. from Drew is Crum

Drew Crum

guys, Hi, morning. good thanks. Okay,

would of for gain then the it for I Michael, segments following your to in Andy, last or slightly, like are you that's So is there broad-based you relative across looks Thanks. margin will think for pace of pretty And talk And termed this about you XXXX? drivers gross the launches see share XXXX the that any new can any up suggested more year. big XXXX? blistering. as what product terms product guidance launches the Can cadence more behind you more portfolio? detail be and a

Andy Paul

Yes.

blistering start Let's over different now with have, lines. think, product XX We I pace. the

products. one to expand, of So, has and it those continues refresh to each

in price some lines while, so refreshing, older our for points largely SKUs place, in been So, features. new of a have we're bringing we we've most clearly product and

completely lines, product new we're segments. newer Some of adding product the

So to be solutions. hardware push a fairly offering boundaries, expect software every we're a and roughly product sort of to month product But new the streaming, continuing I both week launching year. a major next and

Michael Potter

sort It's And halves question to to year-over-year, in margin improve year. of be expect the during we terms a margins the of of do X going tale year-over-year.

a more where remain supply things to and of low. going will back down. costs expenses sort expect come half freight bit but to First constraints higher, and the the promotional a return of more in we promotional that there's normal activities freight bit activity, year, have half more a should we're year, see but relatively little are the We of little scenario

up that, expect be in get first we half we constrained bring and because to that environment margins will higher with than our margins. keep faster between improve to systems business, We'll to those enjoy even benefit year-over-year. So components the growing able we some obviously, do also business and think the peripherals,

Drew Crum

it. Got

guys. Thanks Okay.

Operator

is next proceed. Please Nollen Our with question Tim Macquarie. from

Tim Nollen

Hi, thanks much. very

now this from during way I that? from a addition Game tide entering the wonder may services. platform-agnostic, for have your with being might With console if of possible what within the have of cloud while in cycle boosted COVID was talking how down more that system, XXXX last kind actually Pass these been and anything rising of come your about much the more gaming break COVID. how in year much launch come especially compared have of to growth, rise of might growth You've little some growth maybe to it's that gamers the now of in just that

Andy Paul

Yes. That's question. good a

think, this relatively of revenue. around Console our subsidiary, part and gaming, main to a our is compared the overall point. console revolved still insignificant So at gaming, – look, that's SCUF our small revenue is company gaming cloud I that

in there. So, middle and console a we're the transition of

more XXXX there. platforms new of gaming. the last that So, we in of – as But growth growth a huge PC year came say expect so get pretty much I'd XX% traditional our didn't lot so in out from XXXX,

Tim Nollen

recent think into I getting fairly your And through Okay. relatedly, acquisition after now some is small actually, come XXXX, deals. you've revenue

could Just growth guidance? component revenue is what if and exchange a foreign the within of acquisition us growth there's a also breakdown give maybe you

Michael Potter

Yes.

year-over-year, existing of we growth that terms in have don't planned in acquisitions growth our That's number. any business. the So

as for Just driven an by it's the X% mainly indication acquisitions for XXXX just from came total growth, over SCUF.

our acquisitions numbers our on that we of for growth may owned most happen, products. that Obviously, in announced may working the growth not don't year-over-year. from are came already our not So, include and any we're or

Tim Nollen

into Okay. well. number if And as currency foreign baked impacts the

Michael Potter

U.S. There's dollar impact a weaker. in. a bit baked foreign little of has bit little been The currency

So, base and improvement, makes margin heavily because when more I our a in – talk little in of supply to China. harder about it Asia it

we impact bit talk to assumptions, into and call a needed baked in that little thought but our that margin there's we've and So dramatic nothing nothing out of about.

Tim Nollen

Okay, thanks.

Operator

with proceed. Our Baird. question is from Please Sebastian Robert W. next Colin

Colin Sebastian

what's out realizing you little morning particularly promotional I peripheral there's looks embedded And still this everyone. factors. for questions other of Thanks, margin, maybe as at more wondering good the second about in a the you overall could there bit just QX, right. if if terms on the pricing on wondering, year, you. decline Andy, the am in question the primary and into that context One Thank or what if gross looking provide just environment All quarter-over-quarter of then? lot is then like look segment mix product of are secondly, a half, driver that market

Andy Paul

So, like year. a are content, a expedite But because is is I about gamer of the is imagine, that progression, X% And in creators the the X% have factors, and of margins on Inbound part to terms and the short gamer creator high so about margin freight are of go that's talking first and fact that think adverse segment. in effect. significantly, with to change second down One full-featured thing naturally most down can really. over about it products, was had supply. growth we up products going high you costs. and -- the and the started the the that think overall, question the you're gross were I semiconductor that mean, to freight it the shortage X% to fact SP two I the looks slight

disappointed So, with too that. we weren't

Colin Sebastian

in in just environment embedded And what's promotional expectations? your terms the pricing of second Thanks. for the and half,

Andy Paul

Yes.

don't second like this tough plan So But look, world we the said, point. normal – – do to almost elevated to promotional the freight moment the country. down more amount the significantly. would of with at the consumer coming come that activity imply very They're half on at we costs it's to we that electronics and back also we assuming goes the slightly

we And cancel be by will so in expect decrease out promotion the out increase is freight what – roughly, in costs. roughly the canceled

it be expect neutral. somewhat So, to

Colin Sebastian

Thank you.

Operator

Company. question proceed. Please is and with from Creutz Our next Cowen Doug

Doug Creutz

H, thanks.

your evolve areas you continues the Just make feel of rapidly, would as Thanks. business wondering, M&A where very like some any market there are strategic to sense?

Andy Paul

of want we've because in reveal the up. categories, right terms product Well, which to partners yet, that's show got an question we don't really lot to of a have to find interesting targets and you

evolving and looking and most we're software to I with either constantly of them companies or a do few, services, evaluating. we're around the and would say all to, that's look I talking So across quite are gaming streaming. if

power next at. like So, major that we're we're I for to more consumers not around expanding offerings some case more richer that. consolidation. biggest or about to and buy do planning the really mean, anything or supply of a lot companies three not It's we're companies looking having looking

Doug Creutz

Okay Thanks. that’s helpful

Operator

Robinson is Our Tevis D.A. next from Davidson. proceed. question with Please

Tevis Robinson

areas? was X the case Do congrats much that, talked on specific so you gaming was fourth based in you. if with Last conversations in all categories new the Thank confident quarter? purchases. about your like customers notion the or repeat that quarter, or Thanks great and it once quarter. think again you're X And to driving you you're your sales to refresh on so, or a retailers, that of versus across

Andy Paul

a good question. Yes, that's

that was think building thing sense up stepped that the I gaming how us people PCs. mostly surprised it Our many And the is was much start same. to

or see but so XX% that many compared U.S., second look growth when months month was in the a huge half, amount of were in a happening, the surprised to where saw previous we market year. the – month, at MPD we the for to example, we very growth XX% the in X% historically Now been has XX% we see not especially growth that to year, and the industry,

stepping surprising the typically people components. the of were building amount that $X,XXX was with most is that computers, to build are up which our people So what thing,

indicates to a fairly or streaming. heavy that So gaming commitment

think for knew a I lot to most the and surge people components were a I always the sort system when thing surprising happens going But us. that start That thing. was peripherals. yes, gaming. headsets of was of in mean, surprising we there's buying

also saw activity strong very We streaming. in

content number is of we've course, So going also streaming people is, and streaming exploding, non-gaming is two people of streaming things exploding. exploding, gaming the streaming, is on. got One people

I is of we It's think streaming million just channels. YouTube the now astounding. channels mentioned XX gaming has, number which that

are through So, that I think the some year. of we saw things the those

Tevis Robinson

for much question. so taking Thanks my

Operator

remarks. like question-and-answer We I Andy have back turn reached over the would closing session. the end of for to to our conference Paul

Andy Paul

products, is of to e-sports around centered positioned Look, With take Corsair are Well, think is growing Today, of gamers entertainment. at of forefront this we gear for We're and brand relentless the engaged exploding a be we the and market. our the of passionate streaming. streamers high-performance community and pursuit better this an uniquely advantage of gaming, summary, quality global to unparalleled of market in of thank proud a and you. massively performance. leading in provider, new innovator era

your interest on need streamers best play you in their and call Thank it. content gamers for game, doing the tools best fun give us to for today. the produce Corsair, committed are to joining thank and have their they you We and

Operator

conference. Thank today's conclude does you. This

at this your and for disconnect thank participation. your lines time may You you

Corsair Gaming (CRSR) 12 Feb 212020 Q4 Earnings call transcript