PROSPECTUS SUPPLEMENT
SUMMARY
This summary highlights information contained elsewhere or
incorporated by reference in this prospectus supplement and the
accompanying prospectus. This summary does not contain all of the
information that you should consider before deciding to invest in
our Common Stock. You should read this entire prospectus supplement
and the accompanying prospectus, including the “Risk Factors”
section contained in this prospectus supplement, as well as the
other information incorporated by reference in this prospectus
supplement and the accompanying prospectus, including our
consolidated financial statements and the related notes thereto,
carefully before making an investment decision.
The Company
Turtle Beach Corporation is a leading gaming audio and accessory
brand offering a broad selection of cutting-edge, award-winning
gaming headsets for Xbox, PlayStation®, and Nintendo consoles,
as well as for PC, Mac®, and mobile/tablet
devices. For 45 years, Turtle Beach has been a pioneer and key
innovator in audio technology and is one of the most recognized
names in console gaming in North America and Europe. In 2019,
Turtle Beach acquired ROCCAT, a provider of gaming keyboards, mice
and other accessories focused in the personal computer (“PC”)
peripherals market and is expanding its product portfolio into that
large, adjacent gaming market.
Turtle Beach was incorporated in the state of Nevada in 2010 and
the Company’s stock is traded on the Nasdaq Global Market under the
symbol “HEAR.”
VTB Holdings, Inc. (“VTBH”), a wholly-owned subsidiary of Turtle
Beach and the owner of Voyetra Turtle Beach, Inc. (“VTB”), was
incorporated in the state of Delaware in 2010. VTB, the owner of
Turtle Beach Europe Limited (“TB Europe”), was incorporated in the
state of Delaware in 1975 with operations principally located in
White Plains, New York.
Gaming Accessories Business
Turtle Beach launched its first gaming headset – the X51 – in 2005
and has become the leading brand in gaming headsets. The Company
designs and markets a large assortment of audio peripherals for
Xbox, PlayStation®, and Nintendo consoles,
as well as for PC, Mac®, and mobile/tablet
devices. The acquisition of the ROCCAT brand expands Turtle Beach’s
overall portfolio significantly with over 50 core models across
console gaming headsets, PC gaming headsets, PC gaming keyboards,
PC gaming mice and other accessories. These products are
distributed internationally in North America, South America,
Europe, the Middle East, Africa, Australia, and Asia. Turtle Beach
products are sold at thousands of storefronts, including major
retailers such as Amazon, Argos, Best Buy, GAME, GameStop, EB
Games, Media Markt, Saturn, Target and Walmart.
Turtle Beach delivers a wide variety of headsets spanning multiple
price points ranging from $20 to $250, with many headsets
compatible across all major gaming platforms. We believe the price
tiers correspond to customer profiles, beginning with entry-level
gamers and progressing through casual, enthusiast, core, and
professional esports gamers. Each successive price tier
incorporates higher level features, comfort, and finish. For
example, premium headset models typically include features like
large 50mm speakers, leather-wrapped headbands and ear cushions,
memory foam, powerful amplified surround sound, active
noise-cancellation, and Bluetooth® connectivity.
Additional features include audio presets like Bass Boost and
Turtle Beach’s exclusive Superhuman Hearing® sound setting
(which may give players a competitive advantage), removable or
flip-to-mute microphones, Turtle
Beach’s proprietary ProSpecs™ glasses-friendly
design, and rechargeable long-lasting batteries.
As gaming consoles have evolved from dedicated video game platforms
to home entertainment hubs, and as mobile and tablet devices have
become popular entertainment platforms, Turtle Beach has continued
to evolve its product lineup to reflect how content is consumed.
While each Turtle Beach headset is designed for a primary platform,
such as a specific console or PC, nearly all can be used with
multiple platforms, and most are compatible with mobile/tablet
devices through a standard 3.5mm jack or Bluetooth® connectivity. This
primary platform designation, paired with readily identifiable
platform-specific packaging designs, often results in Turtle Beach
products being displayed in multiple in-store sections by retailers,
increasing the prominence of the Turtle Beach brand and its
products in physical retail locations and online. Brick and mortar
retailers often have kiosks that allow shoppers to try the headsets
and experience each headset’s specific fit, feel, and overall audio
quality.
In 2019, Turtle Beach was the leading console gaming headset
manufacturer in North America with a 43.4% dollar share of the
market, as noted in The NPD Group’s retail tracking service,
holding seven of the top 10 selling Xbox One models and five of the
top 10 selling PlayStation®4 models by revenue.
Turtle Beach’s console market share in the UK was 41.3% in 2019 as
reported by GfK Global. We believe the Company has achieved these
high global market shares by delivering high-quality products that
often include first-to-market innovations and
robust features, in addition to superior sound and unmatched
comfort—key factors that consumers look for when shopping for a
gaming headset.
Through its ROCCAT brand, Turtle Beach delivers award-winning
gaming mice, keyboards, headsets and accessories for PC gamers. PC
gaming in the U.S. has seen a resurgence in popularity the past few
years and it continues to be a main gaming platform
internationally, driven by big AAA game launches, PC-specific
esports leagues, teams and players, content creators and
influencers, cross-platform play, and more. While most games are
available on multiple platforms, gaming on PCs offers advantages
that include improved graphics, increased framerate speed and the
precision of mouse/keyboard controls, and more. Gaming mice and
keyboards are engineered to provide gamers with higher-end
performance and a superior gaming experience through benefits
including faster response times, programmable buttons and keys,
software suites to customize and control devices and settings,
improved materials and build quality, and more.