Turtle Beach reiterates $340M–$360M revenue guidance for 2025 as product innovation drives holiday momentum

Earnings Call Insights: Turtle Beach Corporation (TBCH) Q3 2025

MANAGEMENT VIEW

* CEO Cristopher Keirn highlighted that "Turtle Beach delivered another quarter of solid execution against our strategic priorities with results that met our expectations in the face of the ongoing challenges in the gaming accessories market." He reported $80.5 million in revenue for the quarter and noted gross margins improved by nearly 120 basis points year-over-year, now over 37%. Keirn attributed this to operational discipline, cost management, successful tariff mitigation, and partner negotiations.
* Keirn emphasized the recently completed refinancing of the term loan and credit facility, stating it "strengthened our balance sheet, lowered our cost of capital and extended our maturity profile." The refinancing cut the term loan interest rate by more than 450 basis points.
* Keirn detailed $10 million in share repurchases during the quarter, bringing year-to-date buybacks to $17 million. He affirmed that "share repurchases remain an important part of our strategy."
* The CEO reported more than 40 new product launches since Q2 across headsets, controllers, simulation gear, and PC peripherals. Keirn described the company as a "comprehensive gaming accessories leader with the added advantage of official partnerships with all 3 major console platforms."
* CFO Mark Weinswig stated, "Revenue for the third quarter was $80.5 million, in line with expectations. Our gross margin of 37.4% is a year-over-year improvement of nearly 120 basis points, reflecting the benefits of our ongoing cost optimization initiatives and tariff mitigation strategies."

OUTLOOK

* Management reiterated full year 2025 revenue guidance of $340 million to $360 million and adjusted EBITDA guidance of $47 million to $53 million. Keirn said, "We are reiterating our full year 2025 revenue and adjusted EBITDA guidance ranges."
* Keirn pointed to drivers for 2026, including the launch of GTA 6, new AAA games, continued Switch 2 momentum, and an anticipated accessory replacement cycle as setting the stage for a "new multiyear growth cycle in gaming."

FINANCIAL RESULTS

* Weinswig reported operating expenses for the quarter at $24.7 million, which is 30.7% of revenue. Net income for the quarter was $1.7 million, including a onetime noncash write-off of $1.9 million related to refinancing.
* Adjusted EBITDA was $11 million for the third quarter. The cash position at September 30 was $12 million, with total debt at $90 million, resulting in net debt of $78 million.
* Weinswig indicated, "We expect to see significant improvement in our operating cash flow over the next 2 quarters as we benefit from the seasonal dynamics of the holiday period."

Q&A

* Rian Bisson, Craig-Hallum: Asked about the accessory refresh cycle and consumer spending trends for Q4. Keirn responded that "the refresh is, I would say, delayed" but the market is "trending well to that 10% to 12% down" for the year, with the refresh cycle likely to drive growth in 2026.
* Bisson followed up on simulator products. Keirn replied, "race category in general is up year-over-year. Flight sim is very similar to the other categories... down kind of low teens year-over-year."
* Andrew Crum, B. Riley: Inquired about the impact of GTA 6 being postponed. Keirn explained, "We saw that as well. ... We'll factor that into our 2026 guide. ... There's many other things happening in the gaming industry... that really have us excited about what's going on in gaming."
* Crum also asked about gross margin sustainability amid tariffs and holiday promotions. Weinswig answered, "We have seen continuous improvement in our gross margins... we're excited about what the gross margins could be" for Q4.
* Sean McGowan, ROTH Capital: Asked about further tariff mitigation potential. Keirn said, "I wouldn't say that we've exhausted everything we can do there... I'm highly confident in our team's ability to do that."
* Jack Codera, Maxim Group: Queried consumer strength by price point. Keirn noted, "We're seeing a strong response from premium consumers... Some of the lower price points and some of the mids are where we start to see a little bit of challenges."

SENTIMENT ANALYSIS

* Analysts pressed on market recovery, refresh cycles, tariffs, and consumer demand, reflecting a neutral to slightly positive tone, with a focus on near-term risks and future growth drivers.
* Management maintained a confident and upbeat tone, highlighting operational achievements, successful refinancing, and product innovation. Keirn repeatedly expressed confidence in the company’s positioning and future, stating, "I'm confident that Turtle Beach is exceptionally well positioned."
* Compared to the previous quarter, management's tone remained confident, with a continued emphasis on margin discipline and growth prospects. Analysts' sentiment was similarly focused on market uncertainties but acknowledged progress on key initiatives.

QUARTER-OVER-QUARTER COMPARISON

* Guidance for full-year revenue and adjusted EBITDA was reiterated, consistent with the previous quarter.
* Gross margin improvement was highlighted in both quarters, with Q3 showing a further increase and explicit success in tariff mitigation.
* The pace of product launches accelerated in Q3, with over 40 new products announced since Q2. Share repurchases increased from $5 million in Q2 to $10 million in Q3.
* Analysts' questions shifted slightly toward the sustainability of gross margin improvements and the impact of high-profile game releases being delayed.
* Management’s confidence remained steady, with expanded commentary on new product lines and strategic initiatives.

RISKS AND CONCERNS

* Management identified continued challenges in the gaming accessories market, with the accessory refresh cycle described as "delayed."
* Tariff-related cost pressures persist, although management detailed multiple mitigation strategies, including shifting production, partner negotiations, and selective price increases.
* Analysts raised concerns about sustainability of gross margins, consumer strength at lower price points, and the impact of delayed game launches on demand.

FINAL TAKEAWAY

Turtle Beach management underscored sustained progress on operational execution, margin expansion, and strategic capital allocation, all supported by robust product innovation across gaming categories. Despite headwinds in the broader accessories market and moving timelines for key game launches, the company reinforced its 2025 revenue and EBITDA outlook while emphasizing its readiness to capitalize on the anticipated multiyear growth cycle in gaming, especially as new products and platforms gain traction heading into the holiday season and 2026.

Read the full Earnings Call Transcript [https://seekingalpha.com/symbol/tbch/earnings/transcripts]

MORE ON TURTLE BEACH

* Turtle Beach Corporation (TBCH) Q3 2025 Earnings Call Transcript [https://seekingalpha.com/article/4839730-turtle-beach-corporation-tbch-q3-2025-earnings-call-transcript]
* Turtle Beach: Deserving Of A Downgrade Given The Bearish Outlook For The Coming Quarters [https://seekingalpha.com/article/4823888-turtle-beach-deserving-of-a-downgrade-given-the-bearish-outlook-for-the-coming-quarters]
* Turtle Beach: Poised For A Cyclical Rebound [https://seekingalpha.com/article/4823608-turtle-beach-poised-for-a-cyclical-rebound]
* Turtle Beach Q3 2025 Earnings Preview [https://seekingalpha.com/news/4515830-turtle-beach-q3-2025-earnings-preview]
* Seeking Alpha’s Quant Rating on Turtle Beach [https://seekingalpha.com/symbol/TBCH/ratings/quant-ratings]