SAN DIEGO, Aug. 6, 2020 /PRNewswire/ -- Turtle
Beach Corporation (Nasdaq: HEAR), a leading gaming audio and
accessory brand, reported record financial results for the second
quarter ended June 30, 2020.
Second Quarter Summary vs. Year-Ago Quarter:
- Net revenue increased 93% to $79.7
million ($80.1 million in
constant currency);
- Gross margin increased 480 basis points to 36.7%;
- Net income increased significantly to $8.2 million, or $0.51 per diluted share, compared to a net loss
of $2.4 million, or $(0.16) per diluted share; and
- Adjusted EBITDA increased to $12.9
million compared to $1.6
million.
Management Commentary
"Our record-setting performance in the second quarter was driven by
a combination of strong consumer demand for headsets, superior
execution that allowed us to gain market share, and our ability to
leverage operating expenses even as we invested in new growth
initiatives," said Juergen Stark,
CEO of Turtle Beach. "We couldn't be prouder of what our team has
accomplished in recent months under challenging conditions. What is
most encouraging is that we believe the demand is not simply
pulling sales forward that would otherwise have occurred later, but
is also being driven by greater overall engagement of existing
gamers as well as new and lapsed gamers joining the market as new
gaming headset users. In addition, non-gamers are buying headsets
for at-home work, school and socializing."
Stark added, "The increase in demand is not limited to console
gaming, as we saw strong increases in our award-winning ROCCAT line
of PC mice, keyboards and headsets in the quarter, which we expect
will continue, especially with the investments we are making in our
PC portfolio.
"As a result of the performance in the second quarter and our
belief that demand will remain at elevated levels through the end
of the year, we are confident that our results this year will
significantly exceed our earlier forecasts for both sales and
EBITDA. We've stepped-up our investments to capitalize on new
opportunities and, with the integration of the ROCCAT acquisition
going well, the excellent team we have here, and our strong
continued execution, we will continue to take actions to enable and
drive further expansion and growth."
Second Quarter 2020 Financial Results
Net revenue in the second quarter of 2020 increased 93% to
$79.7 million compared to
$41.3 million in the year-ago
quarter. This exceeds the previous record of $60.8 million reported in the second quarter of
2018 by 31% when demand for console headsets was fueled by battle
royale games such as Fortnite. The Company's strong performance in
the second quarter was due to increased demand from a continued
surge in gaming activity, resulting from stay-at-home orders which
increased gaming among existing gamers and caused an influx of new
and lapsed gamers. In addition, the Company's ability to
significantly increase its production and delivery capacity allowed
the Company to achieve the higher revenues and gain market share.
On a constant currency basis, revenue in the second quarter of 2020
was $80.1 million.
Gross margin in the second quarter of 2020 increased 480 basis
points to 36.7% compared to 31.9% in the second quarter of 2019.
This significant increase was due to volume-driven fixed cost
leverage, lower than normal promotional spending given surging
demand, and favorable business mix, partially offset by over
$4 million in incremental air freight
to enable retail supply.
Operating expenses in the second quarter of 2020 were
$19.3 million compared to
$15.5 million in the 2019 period,
with the increase due primarily to the inclusion of expenses
related to ROCCAT for the entire quarter in 2020 (ROCCAT was
acquired in May of 2019), additional investments to expand the PC
gaming product portfolio and ROCCAT brand, and higher
volume-related selling costs, partially offset by lower
transaction-related costs.
Net income in the second quarter of 2020 improved significantly
to $8.2 million compared to a net
loss of $2.4 million in the year-ago
quarter. The increase was due to the strong revenue performance,
higher gross margin as described above and operating expense
leverage.
Net income per share in the second quarter of 2020 was
$0.51 on 16.2 million weighted
average diluted shares outstanding, compared to a net loss per
share of $0.16 on 14.6 million
weighted average diluted shares outstanding in the year-ago
quarter. (Note: per accounting rules, in periods when the Company
reports positive net income, the diluted share count is higher than
in periods when there is a net loss.)
Adjusted net income (as defined below in "Non-GAAP Financial
Measures") in the second quarter of 2020 was $6.8 million, or $0.42 per diluted share, compared to an adjusted
net loss of $0.9 million, or
$(0.06) per share, in the
corresponding period in 2019.
Adjusted EBITDA (as defined below in "Non-GAAP Financial
Measures") in the second quarter of 2020 increased more than
eight-fold to $12.9 million compared
to $1.6 million in the year-ago
quarter.
Balance Sheet Highlights
At June 30, 2020, the Company had
$21.2 million of cash and cash
equivalents with no outstanding debt under its revolving line of
credit. This compares to $3.4 million
of cash and cash equivalents with $10.8
million of outstanding debt under its revolving credit
facility at June 30, 2019.
Increased 2020 Outlook
For the full year 2020, the Company now expects revenue to be
approximately $300 million, which is
more than 30% higher than the midpoint of its prior forecast range
of $224 million to $234 million. The annual revenue forecast
reflects continued strong consumer demand for gaming accessories
driven by new and existing gamers, as well as increased use of
headsets for non-gaming uses, followed by an anticipated further
increase in demand spurred by new console launches around the
holiday season.
Adjusted EBITDA is now expected to be approximately $30 million, or more than 160% above the midpoint
of the prior range of $9 million and
$14 million, reflecting the higher
expected revenue for the year, higher gross margin, partially
offset by expected air freight of over $10
million to enable supply and increased revenue, and an
increase in planned marketing and new product-related investments
to approximately $12 million to
expand the Company's position in the PC accessories market and
drive future growth.
Net income (loss) per diluted share is now expected to
approximate $0.85 compared to prior
guidance of a range of $(0.22) to
$0.03. Adjusted net income (loss) per
diluted share is expected to be approximately $0.80 compared to prior guidance of a range of
$(0.16) and $0.09, both reflecting the aforementioned revenue
and EBITDA forecasts. Per share figures for the full year 2020
assume approximately 16.5 million diluted shares outstanding.
Second Half Outlook
For the second half of 2020, the Company expects net revenue to be
approximately $185 million and
adjusted EBITDA to be approximately $20
million. Net income per diluted share and adjusted net
income per diluted share are both expected to be approximately
$0.50.
With respect to the Company's adjusted EBITDA outlook for the
full year 2020, a reconciliation to its net income (loss) outlook
for the same periods has not been provided because of the
variability, complexity, and lack of visibility with respect to
certain reconciling items between adjusted EBITDA and net income
(loss), including other income (expense), provision for income
taxes and stock-based compensation. These items cannot be
reasonably and accurately predicted without the investment of undue
time, cost and other resources and, accordingly, a reconciliation
of the Company's adjusted EBITDA outlook to its net income (loss)
outlook for such periods is not provided. These reconciling items
could be material to the Company's actual results for such
periods.
Conference Call Details
Turtle Beach Corporation will hold a conference call today,
August 6, 2020, at 6:00 a.m. Pacific Time (9:00 a.m. Eastern Time) to discuss its second
quarter 2020 results.
CEO Juergen Stark and CFO
John Hanson will host the call,
followed by a question and answer session.
Conference Call Details:
Date: Thursday, August 6, 2020
Time: 9:00 a.m. ET / 6:00 a.m.
PT
Toll-Free Dial-in Number: (877) 303-9855
International Dial-in Number: (408) 337-0154
Conference ID: 4756665
For the conference call, please dial-in 5-10 minutes prior to
the start time and an operator will register your name and
organization. If you have any difficulty with the conference call,
please contact Gateway Investor Relations at (949) 574-3860.
The conference call will be broadcast live and available for
replay here and via the investor relations section of the
Company's website at corp.turtlebeach.com.
A replay of the conference call will be available after
12:00 p.m. ET on the same day through
August 13, 2020.
Toll-Free Replay Number: (855)
859-2056
International Replay Number: (404) 537-3406
Replay ID: 4756665
Non-GAAP Financial Measures
In addition to its reported results, the Company has included in this earnings release
certain financial results, including adjusted EBITDA,
adjusted net income, and constant currency revenue,
that the Securities and Exchange
Commission defines as "non-GAAP financial measures." Management believes that such
non-GAAP
financial measures, when read in conjunction with the Company's
reported
results, can provide useful supplemental information
for investors analyzing period-to-period comparisons
of the Company's results. "Adjusted Net Income"
is defined as net income excluding (i) integration and transaction
costs related to the acquisition of the business and assets related
to the ROCCAT brand, (ii) the effect of the mark-to-market
requirement of the financial instrument obligation, (iii) any
change in fair value of contingent consideration and (iv) the
release of valuation allowances on deferred tax assets.
"Adjusted EBITDA" is defined by the
Company as net income (loss) before interest, taxes, depreciation and amortization, stock-based compensation (non-cash),
and certain non-recurring
items that we believe are not
representative of core operations (e.g., the
integration and transaction costs related to the acquisition of the
business and assets related to the ROCCAT brand, the mark-to-market
adjustment for the financial instrument obligation and the change
in fair value of contingent consideration). "Constant currency
revenue" is defined by the Company as revenue excluding the impacts
of fluctuations in exchange rates from prior periods. These
non-GAAP financial measures are presented because management uses
non-GAAP financial measures to evaluate the Company's operating
performance, to perform financial planning, and to determine
incentive compensation. Therefore, the Company believes that the
presentation of non-GAAP financial measures provides useful
information to, and facilitates additional analysis by, investors.
The presented non-GAAP financial measures exclude items that
management does not believe reflect the Company's core operating
performance because such items are inherently unusual,
non-operating, unpredictable, non-recurring, or non-cash.
See a reconciliation
of GAAP results to Adjusted Net Income and
Adjusted EBITDA included below for each of
the three months ended June 30, 2020 and
2019.
About Turtle Beach Corporation
Turtle Beach Corporation (corp.turtlebeach.com) is one of the
world's leading gaming audio and accessory providers. The Turtle
Beach brand (https://www.turtlebeach.com/) is known for pioneering
first-to-market features and patented innovations in high-quality,
comfort-driven headsets for all levels of gamer, making it a
fan-favorite brand and the market leader in console gaming audio
for the last decade. Turtle Beach's ROCCAT brand
(https://www.roccat.org/) combines detail-loving German innovation
with a genuine passion for designing the best PC gaming products.
Under the ROCCAT brand, Turtle Beach creates award-winning
keyboards, mice, headsets, mousepads, and other PC accessories.
Turtle Beach's shares are traded on the Nasdaq Exchange under the
symbol: HEAR.
Cautionary Note on Forward-Looking Statements
This press release includes forward-looking information and
statements within the meaning of the federal securities laws.
Except for historical information contained in this release,
statements in this release may constitute forward-looking
statements regarding assumptions, projections, expectations,
targets, intentions or beliefs about future events. Statements
containing the words "may", "could", "would", "should", "believe",
"expect", "anticipate", "plan", "estimate", "target", "goal",
"project", "intend," "forecast" and similar expressions, or the
negatives thereof, constitute forward-looking statements.
Forward-looking statements involve known and unknown risks and
uncertainties, which could cause actual results to differ
materially from those contained in any forward-looking statement.
These statements are based on management's current belief and
expectations, as well as assumptions made by, and information
currently available to, management.
While the Company believes that its expectations are based upon
reasonable assumptions, there can be no assurances that its goals
and strategy will be realized. Numerous factors, including risks
and uncertainties, may affect actual results and may cause results
to differ materially from those expressed in forward-looking
statements made by the Company or on its behalf. Some of these
factors include, but are not limited to, risks related to: the
substantial uncertainties inherent in the acceptance of existing
and future products; the difficulty of commercializing and
protecting new technology; the impact of competitive products and
pricing; the impact of the coronavirus (COVID-19) pandemic on
consumer demands and manufacturing capabilities; risks relating to,
and uncertainty caused by or resulting from, the COVID-19 pandemic;
risks associated with the expansion of our business including the
integration of any businesses we acquire and the integration of
such businesses within our internal control over financial
reporting and operations; and our liquidity. These risks may be in
addition to the other factors and matters discussed in the
Company's most recent Annual Report on Form 10-K, Quarterly Report
on Form 10-Q, and the Company's other periodic reports
filed with the Securities and Exchange Commission. Except as
required by the securities laws of the
United States, the Company does not intend to publicly
update or revise these forward-looking statements after the date of
this release whether as a result of new information, future
developments or otherwise.
All trademarks are the property of their respective owners.
Turtle Beach
Corporation
|
Condensed
Consolidated Balance Sheets
|
(in thousands, except
par value and share amounts)
|
|
Table
1.
|
|
|
|
|
|
|
|
|
|
|
|
June
30,
|
|
|
December 31,
|
|
|
|
2020
|
|
|
2019
|
|
|
|
(unaudited)
|
|
ASSETS
|
|
(in thousands, except par value and share amounts)
|
|
Current
Assets:
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
21,206
|
|
|
$
|
8,249
|
|
Accounts receivable,
net
|
|
|
37,007
|
|
|
|
44,530
|
|
Inventories
|
|
|
44,953
|
|
|
|
45,711
|
|
Prepaid expenses and
other current assets
|
|
|
10,233
|
|
|
|
4,057
|
|
Total Current
Assets
|
|
|
113,399
|
|
|
|
102,547
|
|
Property and
equipment, net
|
|
|
4,366
|
|
|
|
3,962
|
|
Deferred income
taxes
|
|
|
6,664
|
|
|
|
7,439
|
|
Goodwill
|
|
|
8,178
|
|
|
|
8,515
|
|
Intangible assets,
net
|
|
|
5,518
|
|
|
|
6,011
|
|
Other
assets
|
|
|
2,370
|
|
|
|
2,877
|
|
Total
Assets
|
|
$
|
140,495
|
|
|
$
|
131,351
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
Current
Liabilities:
|
|
|
|
|
|
|
|
|
Revolving credit
facility
|
|
$
|
—
|
|
|
$
|
15,655
|
|
Accounts
payable
|
|
|
41,694
|
|
|
|
22,511
|
|
Other current
liabilities
|
|
|
26,331
|
|
|
|
26,422
|
|
Total Current
Liabilities
|
|
|
68,025
|
|
|
|
64,588
|
|
Deferred income
taxes
|
|
|
140
|
|
|
|
153
|
|
Other
liabilities
|
|
|
2,869
|
|
|
|
3,223
|
|
Total
Liabilities
|
|
|
71,034
|
|
|
|
67,964
|
|
Commitments and
Contingencies
|
|
|
|
|
|
|
|
|
Stockholders' Equity
|
|
|
|
|
|
|
|
|
Common stock, $0.001
par value - 25,000,000 shares authorized; 14,594,731 and 14,488,152
shares issued and outstanding as of June 30, 2020 and December 31,
2019, respectively
|
|
|
15
|
|
|
|
14
|
|
Additional paid-in
capital
|
|
|
179,132
|
|
|
|
176,776
|
|
Accumulated
deficit
|
|
|
(108,870)
|
|
|
|
(113,519)
|
|
Accumulated other
comprehensive income (loss)
|
|
|
(816)
|
|
|
|
116
|
|
Total
Stockholders' Equity
|
|
|
69,461
|
|
|
|
63,387
|
|
Total Liabilities and
Stockholders' Equity
|
|
$
|
140,495
|
|
|
$
|
131,351
|
|
Turtle Beach
Corporation
|
Condensed
Consolidated Statements of Operations
|
(in thousands, except
per-share data)
|
(unaudited)
|
|
Table
2.
|
|
|
|
Three Months
Ended
|
|
|
Six Months
Ended
|
|
|
|
June
30,
|
|
|
June
30,
|
|
|
June
30,
|
|
|
June
30,
|
|
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
Net
revenue
|
|
$
|
79,680
|
|
|
$
|
41,330
|
|
|
$
|
114,687
|
|
|
$
|
86,176
|
|
Cost of
revenue
|
|
|
50,453
|
|
|
|
28,159
|
|
|
$
|
74,675
|
|
|
$
|
58,218
|
|
Gross
profit
|
|
|
29,227
|
|
|
|
13,171
|
|
|
|
40,012
|
|
|
|
27,958
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling and
marketing
|
|
|
9,559
|
|
|
|
7,550
|
|
|
$
|
17,207
|
|
|
$
|
14,431
|
|
Research and
development
|
|
|
3,001
|
|
|
|
1,734
|
|
|
$
|
5,428
|
|
|
$
|
3,190
|
|
General and
administrative
|
|
|
6,710
|
|
|
|
6,194
|
|
|
$
|
12,433
|
|
|
$
|
10,843
|
|
Total operating
expenses
|
|
|
19,270
|
|
|
|
15,478
|
|
|
|
35,068
|
|
|
|
28,464
|
|
Operating income
(loss)
|
|
|
9,957
|
|
|
|
(2,307)
|
|
|
|
4,944
|
|
|
|
(506)
|
|
Interest
expense
|
|
|
83
|
|
|
|
111
|
|
|
$
|
252
|
|
|
$
|
355
|
|
Other non-operating
expense, net
|
|
|
(1,616)
|
|
|
|
(70)
|
|
|
$
|
(1,419)
|
|
|
$
|
(1,732)
|
|
Income (loss) before
income tax
|
|
|
11,490
|
|
|
|
(2,348)
|
|
|
|
6,111
|
|
|
|
871
|
|
Income tax
expense
|
|
|
3,286
|
|
|
|
25
|
|
|
$
|
1,462
|
|
|
$
|
189
|
|
Net income
(loss)
|
|
$
|
8,204
|
|
|
$
|
(2,373)
|
|
|
$
|
4,649
|
|
|
$
|
682
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per
share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.56
|
|
|
$
|
(0.16)
|
|
|
$
|
0.32
|
|
|
$
|
0.05
|
|
Diluted
|
|
$
|
0.51
|
|
|
$
|
(0.16)
|
|
|
$
|
0.30
|
|
|
$
|
(0.06)
|
|
Weighted average
number of shares:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
14,581
|
|
|
|
14,586
|
|
|
|
14,538
|
|
|
|
14,462
|
|
Diluted
|
|
|
16,229
|
|
|
|
14,586
|
|
|
|
15,363
|
|
|
|
15,699
|
|
Turtle Beach
Corporation
|
Condensed
Consolidated Statements of Cash Flows
|
(in
thousands)
|
(unaudited)
|
|
Table
3.
|
|
|
|
Six Months
Ended
|
|
|
|
June 30,
2020
|
|
|
June 30,
2019
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
OPERATING ACTIVITIES
|
|
$
|
31,842
|
|
|
$
|
38,172
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES
|
|
|
(2,303)
|
|
|
|
(13,674)
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
Borrowings on
revolving credit facilities
|
|
|
48,426
|
|
|
|
99,453
|
|
Repayment of revolving
credit facilities
|
|
|
(64,081)
|
|
|
|
(126,036)
|
|
Proceeds from exercise
of stock options and warrants
|
|
|
59
|
|
|
|
94
|
|
Repurchase of common
stock
|
|
|
-
|
|
|
|
(1,499)
|
|
Repurchase of common
stock to satisfy employee tax withholding obligations
|
|
|
(108)
|
|
|
|
(145)
|
|
Net cash used for
financing activities
|
|
|
(15,704)
|
|
|
|
(28,133)
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
|
|
(878)
|
|
|
|
3
|
|
Net increase
(decrease) in cash and cash equivalents
|
|
|
12,957
|
|
|
|
(3,632)
|
|
Cash and cash
equivalents - beginning of period
|
|
|
8,249
|
|
|
|
7,078
|
|
Cash and cash
equivalents - end of period
|
|
$
|
21,206
|
|
|
$
|
3,446
|
|
Turtle Beach
Corporation
|
Reconciliation of
GAAP and Non-GAAP Measures
|
(in thousands, except
per-share data)
|
(unaudited)
|
|
Table
4.
|
|
|
|
Three Months
Ended
|
|
|
Six Months
Ended
|
|
|
|
June 30,
2020
|
|
|
June 30,
2019
|
|
|
June 30,
2020
|
|
|
June 30,
2019
|
|
Net Income
(Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Net Income
(Loss)
|
|
$
|
8,204
|
|
|
$
|
(2,373)
|
|
|
$
|
4,649
|
|
|
$
|
682
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments, net of
tax:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on financial
instrument obligation
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1,601)
|
|
Gain on
acquisition-related settlement
|
|
|
(1,702)
|
|
|
|
—
|
|
|
|
(1,702)
|
|
|
|
—
|
|
Change in fair value
of contingent consideration
|
|
|
223
|
|
|
|
—
|
|
|
|
238
|
|
|
|
—
|
|
Acquisition
integration costs
|
|
|
44
|
|
|
|
1,477
|
|
|
|
244
|
|
|
|
2,214
|
|
Non-GAAP
Earnings
|
|
$
|
6,769
|
|
|
$
|
(896)
|
|
|
$
|
3,429
|
|
|
$
|
1,295
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted Earnings Per
Share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP-
Diluted
|
|
$
|
0.51
|
|
|
$
|
(0.16)
|
|
|
$
|
0.30
|
|
|
$
|
(0.06)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on financial
instrument obligation
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
Gain on
acquisition-related settlement
|
|
|
(0.10)
|
|
|
|
—
|
|
|
|
(0.11)
|
|
|
|
—
|
|
Change in fair value
of contingent consideration
|
|
|
0.01
|
|
|
|
—
|
|
|
|
0.01
|
|
|
|
—
|
|
Acquisition
integration costs
|
|
|
—
|
|
|
|
0.10
|
|
|
|
0.02
|
|
|
|
0.14
|
|
Non-GAAP-
Diluted
|
|
$
|
0.42
|
|
|
$
|
(0.06)
|
|
|
$
|
0.22
|
|
|
$
|
0.08
|
|
Turtle Beach
Corporation
|
GAAP to Adjusted
EBITDA Reconciliation
|
(in
thousands)
|
(unaudited)
|
|
Table
5.
|
|
|
|
Three Months
Ended
|
|
|
|
June 30,
2020
|
|
|
|
|
|
|
|
|
|
|
|
|
Adj
|
|
|
|
|
|
|
|
|
|
As
|
|
Adj
|
|
Adj
|
|
Stock
|
|
|
|
|
Adj
|
|
|
|
Reported
|
|
Depreciation
|
|
Amortization
|
|
Compensation
|
|
Other
(1)
|
|
EBITDA
|
|
Net
revenue
|
|
$
|
79,680
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
79,680
|
|
Cost of
revenue
|
|
|
50,453
|
|
|
(593)
|
|
|
-
|
|
|
(280)
|
|
|
-
|
|
|
49,580
|
|
Gross
Profit
|
|
|
29,227
|
|
|
593
|
|
|
-
|
|
|
280
|
|
|
-
|
|
|
30,100
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
19,270
|
|
|
(435)
|
|
|
(220)
|
|
|
(1,126)
|
|
|
(63)
|
|
|
17,427
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
|
9,957
|
|
|
1,028
|
|
|
220
|
|
|
1,406
|
|
|
63
|
|
|
12,674
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
|
83
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other non-operating
expense, net
|
|
|
(1,616)
|
|
|
|
|
|
|
|
|
|
|
|
1,388
|
|
|
(228)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
tax
|
|
|
11,490
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
|
3,286
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
|
$
|
8,204
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
$
|
12,902
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months
Ended
|
|
|
|
June 30,
2020
|
|
|
|
|
|
|
|
|
|
|
|
|
Adj
|
|
|
|
|
|
|
|
|
|
As
|
|
Adj
|
|
Adj
|
|
Stock
|
|
|
|
|
Adj
|
|
|
|
Reported
|
|
Depreciation
|
|
Amortization
|
|
Compensation
|
|
Other
(1)
|
|
EBITDA
|
|
Net
revenue
|
|
$
|
114,687
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
114,687
|
|
Cost of
revenue
|
|
|
74,675
|
|
|
(1,184)
|
|
|
-
|
|
|
(338)
|
|
|
-
|
|
|
73,153
|
|
Gross
Profit
|
|
|
40,012
|
|
|
1,184
|
|
|
-
|
|
|
338
|
|
|
-
|
|
|
41,534
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
35,068
|
|
|
(877)
|
|
|
(443)
|
|
|
(2,067)
|
|
|
(343)
|
|
|
31,338
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
|
4,944
|
|
|
2,061
|
|
|
443
|
|
|
2,405
|
|
|
343
|
|
|
10,196
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
|
252
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other non-operating
expense, net
|
|
|
(1,419)
|
|
|
|
|
|
|
|
|
|
|
|
1,367
|
|
|
(52)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
tax
|
|
|
6,111
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
|
1,462
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
|
$
|
4,649
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
$
|
10,248
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Other includes
certain business acquisition costs, gain on an acquisition-related
settlement and change in fair value of contingent
consideration.
|
Turtle Beach
Corporation
|
GAAP to Adjusted
EBITDA Reconciliation
|
(in
thousands)
|
(unaudited)
|
|
Table 5.
(continued)
|
|
|
|
Three Months
Ended
|
|
|
|
June 30,
2019
|
|
|
|
|
|
|
|
|
|
|
|
|
Adj
|
|
|
|
|
|
|
|
|
|
As
|
|
Adj
|
|
Adj
|
|
Stock
|
|
|
|
|
Adj
|
|
|
|
Reported
|
|
Depreciation
|
|
Amortization
|
|
Compensation
|
|
Other
(2)
|
|
EBITDA
|
|
Net
revenue
|
|
$
|
41,330
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
41,330
|
|
Cost of
revenue
|
|
|
28,159
|
|
|
(427)
|
|
|
-
|
|
|
(93)
|
|
|
-
|
|
|
27,638
|
|
Gross
Profit
|
|
|
13,171
|
|
|
427
|
|
|
-
|
|
|
93
|
|
|
-
|
|
|
13,691
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
15,478
|
|
|
(713)
|
|
|
(159)
|
|
|
(910)
|
|
|
(1,563)
|
|
|
12,133
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
|
|
(2,307)
|
|
|
1,140
|
|
|
159
|
|
|
1,003
|
|
|
1,563
|
|
|
1,558
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
|
111
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other non-operating
expense, net
|
|
|
(70)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(70)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss before income
tax
|
|
|
(2,348)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
|
25
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss
|
|
$
|
(2,373)
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
$
|
1,628
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months
Ended
|
|
|
|
June 30,
2019
|
|
|
|
|
|
|
|
|
|
|
|
|
Adj
|
|
|
|
|
|
|
|
|
|
As
|
|
Adj
|
|
Adj
|
|
Stock
|
|
|
|
|
Adj
|
|
|
|
Reported
|
|
Depreciation
|
|
Amortization
|
|
Compensation
|
|
Other
(2)
|
|
EBITDA
|
|
Net
revenue
|
|
$
|
86,176
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
86,176
|
|
Cost of
revenue
|
|
|
58,218
|
|
|
(779)
|
|
|
-
|
|
|
32
|
|
|
-
|
|
|
57,471
|
|
Gross
Profit
|
|
|
27,958
|
|
|
779
|
|
|
-
|
|
|
(32)
|
|
|
-
|
|
|
28,705
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
28,464
|
|
|
(1,401)
|
|
|
(221)
|
|
|
(1,557)
|
|
|
(2,343)
|
|
|
22,942
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
|
|
(506)
|
|
|
2,180
|
|
|
221
|
|
|
1,525
|
|
|
2,343
|
|
|
5,763
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
|
355
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other non-operating
expense, net
|
|
|
(1,732)
|
|
|
|
|
|
|
|
|
|
|
|
1,601
|
|
|
(131)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
tax
|
|
|
871
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
|
189
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
|
$
|
682
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
$
|
5,894
|
|
|
|
(2)
|
Other includes
certain business acquisition costs and a gain (loss) on financial
instrument obligation.
|
View original content to download
multimedia:http://www.prnewswire.com/news-releases/turtle-beach-reports-record-second-quarter-2020-results-and-significantly-raises-full-year-outlook-301107289.html
SOURCE Turtle Beach Corporation