crsr-8k_20210803.htm
false 0001743759 0001743759 2021-08-03 2021-08-03

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 3, 2021

 

CORSAIR GAMING, INC.

(Exact name of Registrant as Specified in Its Charter)

 

 

Delaware

001-39533

82-2335306

(State or other jurisdiction

of incorporation)

(Commission File Number)

(IRS Employer

Identification Number)

47100 Bayside Pkwy

Fremont, California 94538

 

 (Address of principal executive offices, including Zip Code)

Registrant’s telephone number, including area code: (510) 657-8747

Not Applicable

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange on which registered

Common Stock, $0.0001 par value per share

 

CRSR

 

The Nasdaq Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 

 

 

 

 


 

 

Item 2.02 Results of Operations and Financial Condition

 

On August 3, 2021, Corsair Gaming, Inc. (“Corsair” or the “Company”) issued a press release announcing certain of its financial results for the quarter ended June 30, 2021. The full text of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K. Attached hereto as Exhibit 99.2 is a presentation regarding the Company's fiscal quarter ended June 30, 2021.

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit

Number

 

Description

99.1

 

Press Release dated August 3, 2021

99.2

 

Investor Presentation dated August 3, 2021

104

 

Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

The information in this Current Report on Form 8-K and the Exhibit 99.1 and Exhibit 99.2 attached hereto shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended. The information contained herein and in the accompanying exhibit shall not be incorporated by reference into any filing with the U.S. Securities and Exchange Commission made by Corsair Gaming, Inc., whether made before or after the date hereof, regardless of any general incorporation language in such filing.

 

1


 

 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

 

CORSAIR GAMING, INC.

 

 

 

 

Date: August 3, 2021

 

By:

/s/ Michael G. Potter

 

 

 

Michael G. Potter

 

 

 

Chief Financial Officer

(Principal Financial Officer)

 

2

crsr-ex991_6.htm

Exhibit 99.1

 

 

Corsair Gaming Reports Second Quarter 2021 Financial Results

Reports Record Second Quarter Revenue and Profit

 

FREMONT, CA, August 3, 2021Corsair Gaming, Inc. (NASDAQ:CRSR) (“Corsair”), a leading global provider and innovator of high-performance gear for gamers and content creators, today announced financial results for the second quarter ended June 30, 2021.

 

Second Quarter 2021 Highlights

 

 

Net revenue was $472.9 million, an increase of 24.3% year-over-year. Gamer and creator peripherals segment net revenue was $155.2 million, an increase of 40.9% year-over-year. Gaming components and systems segment net revenue was $317.7 million, an increase of 17.6% year-over-year.

 

Gross profit was $130.4 million, an increase of 24.1% year-over-year, with gross margin of 27.6%, flat year-over-year. Gamer and creator peripherals segment gross profit was $54.6 million, an increase of 41.0% year-over-year. Gaming components and systems segment gross profit was $75.7 million, an increase of 14.2% year-over-year.

 

Operating income was $34.7 million, a decrease of 4.7% year-over-year.

 

Adjusted operating income was $49.3 million, an increase of 3.9% year-over-year.

 

Net income was $27.7 million, or $0.28 per diluted share, compared to net income of $22.6 million in the same period last year, or $0.26 per diluted share.

 

Adjusted net income was $35.7 million, or $0.36 per diluted share, compared to adjusted net income of $32.3 million in the same period last year, or $0.37 per diluted share.

 

Adjusted EBITDA was $51.6 million, an increase of 4.0% year-over-year, with adjusted EBITDA margin of 10.9%, a decrease of 210 basis points year-over-year.

 

As of June 30, 2021, we had cash and restricted cash of $138.6 million, $48.6 million capacity under our revolving credit facility and total long-term debt of $270.0 million.

 

Cash flows from operations was $31.6 million, which decreased from $73.6 million in the same period last year.

 

Definitions of the non-GAAP financial measures used in this press release and reconciliations of such measures to their nearest GAAP equivalents are included below under the heading “Use and Reconciliation of Non-GAAP Financial Measures.”

 

“I am pleased with our performance in the second quarter, where we delivered year-over-year revenue growth of 24%.  Our results highlight the strength of the underlying fundamentals of our business, as gamers continue to purchase and upgrade their gear, even as entertainment outside of the home and travel began to open back up.  We experienced growth in every category despite key components shortages, such as graphics cards for enthusiasts to build gaming PCs, logistics issues and port delays,” stated Andy Paul, Chief Executive Officer of Corsair.

“The mid-point of our full-year outlook calls for run-rate revenue of $2 billion compared to our pre-IPO revenue of $1.1 billion in 2019 which shows our strong improvement since then.  We are investing in


R&D, marketing and infrastructure as we remain focused on expanding our resources.  As an example, we are extremely excited by the recent launch our first camera, which has received an overwhelmingly positive response from the creator community.  We have launched over 75 new products so far this year, which is an astounding pace of innovation,” concluded Andy Paul, Chief Executive Officer of Corsair.

“We utilized our increased cash flow to repay an additional $25 million in debt during the second quarter, and we remain focused on further optimizing our capital structure and exploring options to reduce the carrying cost of our debt. During the second quarter, we experienced higher than expected costs for logistics, and we expect logistics costs to remain elevated in the third quarter. Shutdowns from the ongoing pandemic in several large regions we operate in also negatively impacted our operations. We are also continuing to invest in future growth to maintain our high new product launch rate,” said Michael G. Potter, Chief Financial Officer of Corsair.

 

Financial Outlook

 

For the full year 2021 our outlook remains unchanged from Q1 2021 at:

 

 

Net revenue to be in the range of $1.9 billion to $2.1 billion.

 

Adjusted operating income to be in the range of $235 million to $255 million.

 

Adjusted EBITDA to be in the range of $245 million to $265 million.

 

Certain non-GAAP measures included in our financial outlook were not reconciled to the comparable GAAP financial measures because the GAAP measures are not accessible on a forward-looking basis. We are unable to reconcile these forward-looking non-GAAP financial measures to the most directly comparable GAAP measures without unreasonable efforts because we are currently unable to predict with a reasonable degree of certainty the type and extent of certain items that would be expected to impact GAAP measures for these periods but would not impact the non-GAAP measures. Such items may include stock-based compensation charges, public offering related charges, depreciation and amortization, and other items. The unavailable information could have a significant impact on our GAAP financial results.

 

The foregoing forward-looking statements reflect our expectations as of today's date. Given the number of risk factors, uncertainties and assumptions discussed below, actual results may differ materially. We do not intend to update our financial outlook until our next quarterly results announcement.

 

Please see “Use and Reconciliation of Non-GAAP Financial Measures” below for a discussion on how we calculate the non-GAAP measures presented herein and a reconciliation to the most directly comparable GAAP measure.

 

Recent Developments

 

 

On July 15, 2021, Corsair under its Elgato brand announced the Facecam, a new premium webcam, alongside three more new products for content creators, including the Wave XLR, which is an XLR to USB Type-C microphone interface and digital audio mixer, and Wave Mic Arm and Wave Mic Arm LP, two fully adjustable boom arms for optimal desktop microphone positioning.  Facecam features a high quality multi-layer glass lens and Sony sensor plus software to adjust


 

contrast, white balance and exposure. Facecam outputs true Full HD at 1080p60fps without artifacts thanks to an advanced image engine that outputs uncompressed video.  

 

On June 29, 2021, Corsair announced a new series of full-tower ATX cases: the Corsair 7000D AIRFLOW and the Corsair iCUE 7000X RGB. With the launch of the 7000 Series, ORIGIN PC is adding the 7000D AIRFLOW and 7000X RGB cases to its award-winning line of GENESIS custom PCs. Boasting some of the highest-end hardware, from Intel Core™ i9 and AMD Ryzen™ CPUs to NVIDIA® GeForce RTX™ 30-Series graphics, ORIGIN PC’s GENESIS line of desktops combines superpowered specs with maximum customization.

 

On May 13, 2021, Corsair announced the launch of its flagship VIRTUOSO family of premium gaming headsets: the VIRTUOSO RGB Wireless XT. Connecting via hyper-fast SLIPSTREAM WIRELESS and Bluetooth® for simultaneous dual-wireless connections, in addition to high-fidelity USB and universal 3.5mm wired connection options, the VIRTUOSO RGB Wireless XT combines exquisite sound quality, comfort, and versatility.

 

On May 6, 2021, Corsair announced the launch of its 5000D RGB Hydro X Edition and 5000X RGB Signature Series Mid-tower cases. Whether PC enthusiasts choose the 5000D RGB Hydro X Edition with the brand-new XD7 RGB distribution plate system or the attention-grabbing designs of the 5000X RGB SIGNATURE SERIES, there are now more options to make the Corsair 5000 Series the starting point for a standout PC.

 

Conference Call and Webcast Information

 

We will host a conference call to discuss the second quarter 2021 financial results on August 3, 2021, at 5:30 a.m. PT. The conference call can be accessed live over the phone by dialing 1-855-327-6838, or for international callers 1-604-235-2082. A replay will be available from 8:30 a.m. PT on August 3, 2021 through August 10, 2021, by dialing 1-844-512-2921, or for international callers 1-412-317-6671. The replay passcode is 10015620.

 

The call will also be webcast live from our investor relations website at https://ir.corsair.com. Following completion of the call, a recorded replay of the webcast will be available on the website.

 

About Corsair Gaming, Inc.

 

Corsair Gaming, Inc. (NASDAQ:CRSR) is a leading global developer and manufacturer of high-performance gear and technology for gamers, content creators, and PC enthusiasts. From award-winning PC components and peripherals to premium streaming equipment and smart ambient lighting, Corsair delivers a full ecosystem of products that work together to enable everyone, from casual gamers to committed professionals, to perform at their very best.

 

Corsair also sells gear under our Elgato brand, which provides premium studio equipment and accessories for content creators, SCUF Gaming brand, which builds custom-designed controllers for competitive gamers, and ORIGIN PC brand, a builder of custom gaming and workstation desktop PCs and laptops.

 

Forward Looking Statements

 

Except for the historical information contained herein, the matters set forth in this press release are forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, including, but not limited to, our estimated full year 2021 net revenue, adjusted operating income and adjusted EBITDA; the strength of our underlying fundamentals; ; and whether we will be able to optimize our capital structure, reduce the carrying cost of debt and continue


to reduce our existing debt. Forward-looking statements are based on our management’s beliefs, as well as assumptions made by, and information currently available to them. Because such statements are based on expectations as to future financial and operating results and are not statements of fact, actual results may differ materially from those projected. Factors which may cause actual results to differ materially from current expectations include, but are not limited to: the impact the COVID-19 pandemic will have on demand for our products as well as its impact on our operations and the operations of our manufacturers, retailers and other partners, and its impact on the economy overall, including capital markets; our ability to build and maintain the strength of our brand among gaming and streaming enthusiasts and our ability to continuously develop and successfully market new gear and improvements; the introduction and success of new third-party high-performance computer hardware, particularly graphics processing units and central processing units as well as sophisticated new video games; the risk that we are not able to compete with competitors and/or that the gaming industry, including streaming and eSports, does not grow as expected or declines; the loss or inability to attract and retain key management; delays or disruptions at our or third-parties manufacturing and distribution facilities; currency exchange rate fluctuations or international trade disputes resulting in our gear becoming relatively more expensive to our overseas customers or resulting in an increase in our manufacturing costs; the impact of the coronavirus on our  business; general economic conditions that adversely effect, among other things, consumer confidence and spending; and the other factors described under the heading “Risk Factors” in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2021 to be filed with the Securities and Exchange Commission (SEC) on or about the date hereof and our subsequent filings with the SEC. Copies of each filing may be obtained from us or the SEC. All forward-looking statements reflect our beliefs and assumptions only as of the date of this press release. We undertake no obligation to update forward-looking statements to reflect future events or circumstances. Our results for the quarter ended June 30, 2021 are not necessarily indicative of our operating results for any future periods.

 

Use and Reconciliation of Non-GAAP Financial Measures

 

To supplement the financial results presented in accordance with GAAP, this earnings release presents certain non-GAAP financial information, including Adjusted Operating Income, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income and Adjusted Net Income Per Share. These are important financial performance measures for us, but are not financial measures as defined by GAAP. The presentation of this non-GAAP financial information is not intended to be considered in isolation of or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.

 

We use Adjusted Operating Income, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income and Adjusted Net Income Per Share to evaluate our operating performance and trends and make planning decisions. We believe that these non-GAAP measures help identify underlying trends in our business that could otherwise be masked by the effect of the expenses and other items that we exclude in such non-GAAP measures. Accordingly, we believe that Adjusted Operating Income, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income and Adjusted Net Income Per Share provide useful information to investors and others in understanding and evaluating our operating results, enhancing the overall understanding of our past performance and future prospects, and allowing for greater transparency with respect to the key financial metrics used by our management in our financial and operational decision-making. We also present these non-GAAP financial performance measures because we believe investors, analysts and rating agencies consider them useful in measuring our ability to meet our debt service obligations.

 

Our use of these terms may vary from that of others in our industry. These non-GAAP financial measures should not be considered as an alternative to revenues, operating income, net income, cash provided by


operating activities, or any other measures derived in accordance with GAAP as measures of operating performance or liquidity. Reconciliations of these measures to the most directly comparable GAAP financial measures are presented in the attached schedules.

 

We calculate these non-GAAP financial measures as follows:

 

 

Adjusted operating income, non-GAAP, is determined by adding back to GAAP operating income the acquisition accounting impact related to recognizing acquired inventory at fair value, change in fair value of contingent consideration for business acquisition, non-cash inventory impairment, stock-based compensation, intangible asset amortization, certain acquisition-related and integration-related expenses, non-deferred costs associated with the IPO, secondary offering costs, and debt modification costs.

 

Adjusted net income, non-GAAP, is determined by adding back to GAAP net income the acquisition accounting impact related to recognizing acquired inventory at fair value, change in fair value of contingent consideration for business acquisition, non-cash inventory impairment, stock-based compensation, intangible asset amortization, certain acquisition-related and integration-related expenses, non-deferred costs associated with the IPO, secondary offering costs, debt modification costs, loss on extinguishment of debt, and the related tax effects of each of these adjustments.

 

Adjusted net income per diluted share, non-GAAP, is determined by dividing adjusted net income, non-GAAP by the respective weighted average shares outstanding, inclusive of the impact of other dilutive securities.

 

Adjusted EBITDA is determined by adding back to GAAP net income the acquisition accounting impact related to recognizing acquired inventory at fair value, change in fair value of contingent consideration for business acquisition, non-cash inventory impairment, stock-based compensation, certain acquisition-related and integration-related expenses, non-deferred costs associated with the IPO, secondary offering costs, debt modification costs, intangible asset amortization, depreciation and amortization, interest expense (including loss on extinguishment of debt) and tax expense.

 

Adjusted EBITDA margin is determined by dividing adjusted EBITDA by net revenue for the respective periods.  

 

We encourage investors and others to review our financial information in its entirety, not to rely on any single financial measure and to view these non-GAAP financial measures in conjunction with the related GAAP financial measures.

 

Source: Corsair Gaming, Inc.

 

Investor Relations Contact:

Ronald van Veen

ir@corsair.com

510-578-1407

 

Media Contact:

Adrian Bedggood

adrian.bedggood@corsair.com

510-657-8747

+44-7989-258827


Corsair Gaming, Inc.

Condensed Combined Consolidated Statements of Operations

(Unaudited, in thousands, except per share amounts)

 

 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net revenue

 

$

472,903

 

 

$

380,407

 

 

$

1,002,317

 

 

$

688,925

 

Cost of revenue

 

 

342,552

 

 

 

275,343

 

 

 

711,638

 

 

 

505,239

 

Gross profit

 

 

130,351

 

 

 

105,064

 

 

 

290,679

 

 

 

183,686

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales, general and administrative

 

 

80,169

 

 

 

56,827

 

 

 

158,022

 

 

 

110,556

 

Product development

 

 

15,469

 

 

 

11,827

 

 

 

30,655

 

 

 

23,383

 

Total operating expenses

 

 

95,638

 

 

 

68,654

 

 

 

188,677

 

 

 

133,939

 

Operating income

 

 

34,713

 

 

 

36,410

 

 

 

102,002

 

 

 

49,747

 

Other (expense) income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

(4,508

)

 

 

(9,572

)

 

 

(9,454

)

 

 

(18,946

)

Other (expense) income, net

 

 

(175

)

 

 

11

 

 

 

(2,600

)

 

 

(52

)

Total other expense, net

 

 

(4,683

)

 

 

(9,561

)

 

 

(12,054

)

 

 

(18,998

)

Income before income taxes

 

 

30,030

 

 

 

26,849

 

 

 

89,948

 

 

 

30,749

 

Income tax expense

 

 

(2,285

)

 

 

(4,249

)

 

 

(15,480

)

 

 

(6,932

)

Net income

 

$

27,745

 

 

$

22,600

 

 

$

74,468

 

 

$

23,817

 

Net income per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.30

 

 

$

0.27

 

 

$

0.81

 

 

$

0.28

 

Diluted

 

$

0.28

 

 

$

0.26

 

 

$

0.74

 

 

$

0.28

 

Weighted-average shares used to compute

    net income per share

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

92,792

 

 

 

84,098

 

 

 

92,374

 

 

 

84,089

 

Diluted

 

 

100,074

 

 

 

86,333

 

 

 

100,145

 

 

 

86,201

 

 


 

Corsair Gaming, Inc.

Segment Information

(Unaudited, in thousands, except percentages)

 

 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

 

 

2021

2020

 

 

2021

 

 

2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gamer and Creator Peripherals

 

$

155,157

 

 

$

110,115

 

 

$

331,069

 

 

$

185,976

 

Gaming Components and Systems

 

 

317,746

 

 

 

270,292

 

 

 

671,248

 

 

 

502,949

 

    Total Net Revenue

 

$

472,903

 

 

$

380,407

 

 

$

1,002,317

 

 

$

688,925

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross Profit:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gamer and Creator Peripherals

 

$

54,634

 

 

$

38,743

 

 

 

123,500

 

 

$

60,876

 

Gaming Components and Systems

 

 

75,717

 

 

 

66,321

 

 

 

167,179

 

 

 

122,810

 

        Total Gross Profit

 

$

130,351

 

 

$

105,064

 

 

$

290,679

 

 

$

183,686

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross Margin:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gamer and Creator Peripherals

 

 

35.2

%

 

 

35.2

%

 

 

37.3

%

 

 

32.7

%

Gaming Components and Systems

 

 

23.8

%

 

 

24.5

%

 

 

24.9

%

 

 

24.4

%

    Total Gross Margin

 

 

27.6

%

 

 

27.6

%

 

 

29.0

%

 

 

26.7

%

 



 

Corsair Gaming, Inc.

Condensed Combined Consolidated Balance Sheets

(Unaudited, in thousands)

 

 

 

June 30,

2021

 

 

December 31,

2020

 

 

 

 

 

 

 

 

 

 

Assets

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and restricted cash

 

$

138,320

 

 

$

133,338

 

Accounts receivable, net

 

 

258,789

 

 

 

293,629

 

Inventories

 

 

273,399

 

 

 

226,007

 

Prepaid expenses and other current assets

 

 

61,465

 

 

 

37,997

 

Total current assets

 

 

731,973

 

 

 

690,971

 

Property and equipment, net

 

 

16,034

 

 

 

16,475

 

Goodwill

 

 

314,205

 

 

 

312,760

 

Intangible assets, net

 

 

243,711

 

 

 

259,317

 

Restricted cash, noncurrent

 

 

231

 

 

 

230

 

Other assets

 

 

72,250

 

 

 

34,362

 

TOTAL ASSETS

 

$

1,378,404

 

 

$

1,314,115

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

$

261,656

 

 

$

299,636

 

Other liabilities and accrued expenses

 

 

232,373

 

 

 

205,745

 

Total current liabilities

 

 

494,029

 

 

 

505,381

 

Debt, net

 

 

270,013

 

 

 

321,393

 

Deferred tax liabilities

 

 

30,983

 

 

 

29,752

 

Other liabilities, noncurrent

 

 

53,693

 

 

 

20,199

 

TOTAL LIABILITIES

 

 

848,718

 

 

 

876,725

 

Stockholders’ Equity:

 

 

 

 

 

 

 

 

Common stock and additional paid-in capital

 

 

456,019

 

 

 

438,676

 

Retained earnings (accumulated deficit)

 

 

71,655

 

 

 

(2,813

)

Accumulated other comprehensive income

 

 

2,012

 

 

 

1,527

 

Total Stockholders’ Equity

 

 

529,686

 

 

 

437,390

 

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

 

$

1,378,404

 

 

$

1,314,115

 

 

 



 

Corsair Gaming, Inc.

Condensed Combined Consolidated Statements of Cash Flows

(Unaudited, in thousands)

 

 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash flows from operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

27,745

 

 

$

22,600

 

 

$

74,468

 

 

$

23,817

 

Adjustments to reconcile net income to net cash

   provided by operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   Stock-based compensation

 

 

4,768

 

 

 

1,550

 

 

 

7,844

 

 

 

2,655

 

   Depreciation

 

 

2,502

 

 

 

2,206

 

 

 

4,938

 

 

 

4,364

 

   Amortization of intangible assets

 

 

8,712

 

 

 

8,392

 

 

 

17,414

 

 

 

16,839

 

   Debt issuance costs amortization

 

 

515

 

 

 

703

 

 

 

1,052

 

 

 

1,282

 

   Loss on debt extinguishment

 

 

358

 

 

 

392

 

 

 

797

 

 

 

392

 

   Deferred income taxes

 

 

(2,183

)

 

 

(1,537

)

 

 

(5,188

)

 

 

(1,531

)

   Other

 

 

(250

)

 

 

236

 

 

 

1,066

 

 

 

738

 

   Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

      Accounts receivable

 

 

45,924

 

 

 

(55,723

)

 

 

32,508

 

 

 

(18,291

)

      Inventories

 

 

(45,387

)

 

 

926

 

 

 

(58,895

)

 

 

1,071

 

      Prepaid expenses and other assets

 

 

(5,226

)

 

 

(1,149

)

 

 

(9,645

)

 

 

5,163

 

      Accounts payable

 

 

(10,674

)

 

 

58,761

 

 

 

(37,662

)

 

 

15,228

 

      Other liabilities and accrued expenses

 

 

4,825

 

 

 

36,251

 

 

 

30,700

 

 

 

23,881

 

         Net cash provided by operating activities

 

 

31,629

 

 

 

73,608

 

 

 

59,397

 

 

 

75,608

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   Acquisition of business, net of cash acquired

 

 

 

 

 

 

 

 

(1,684

)

 

 

 

   Payment of deferred and contingent consideration

 

 

 

 

 

 

 

 

(4,353

)

 

 

 

   Purchase of property and equipment

 

 

(2,858

)

 

 

(1,159

)

 

 

(4,894

)

 

 

(3,006

)

         Net cash used in investing activities

 

 

(2,858

)

 

 

(1,159

)

 

 

(10,931

)

 

 

(3,006

)

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   Repayment of debt

 

 

(25,000

)

 

 

(12,626

)

 

 

(53,000

)

 

 

(13,820

)

   Payment of other offering costs

 

 

 

 

 

(154

)

 

 

 

 

 

(269

)

   Proceeds from issuance of shares through employee

      equity incentive plans

 

 

9,281

 

 

 

965

 

 

 

9,466

 

 

 

965

 

   Payment of taxes related to net share settlement of

      equity awards

 

 

(7

)

 

 

 

 

 

(7

)

 

 

 

         Net cash used in financing activities

 

 

(15,726

)

 

 

(11,815

)

 

 

(43,541

)

 

 

(13,124

)

Effect of exchange rate changes on cash

 

 

(76

)

 

 

198

 

 

 

58

 

 

 

(110

)

Net increase in cash and restricted cash

 

 

12,969

 

 

 

60,832

 

 

 

4,983

 

 

 

59,368

 

Cash and restricted cash at the beginning of the period

 

 

125,582

 

 

 

50,483

 

 

 

133,568

 

 

 

51,947

 

Cash and restricted cash at the end of the period

 

$

138,551

 

 

$

111,315

 

 

$

138,551

 

 

$

111,315

 

 

 

 



 

Corsair Gaming, Inc.

GAAP to Non-GAAP Reconciliations

 

Non-GAAP Operating Income Reconciliations

(Unaudited, in thousands, except percentages)

 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Income - GAAP

 

$

34,713

 

 

$

36,410

 

 

$

102,002

 

 

$

49,747

 

Acquisition accounting impact related to recognizing acquired

   inventory at fair value

 

 

 

 

 

(27

)

 

 

 

 

 

394

 

Change in fair value of contingent consideration for business

   acquisition

 

 

21

 

 

 

 

 

 

93

 

 

 

 

Non-cash inventory impairment

 

 

518

 

 

 

 

 

 

518

 

 

 

 

Stock-based compensation

 

 

4,768

 

 

 

1,550

 

 

 

7,844

 

 

 

2,655

 

Intangible asset amortization

 

 

8,712

 

 

 

8,392

 

 

 

17,414

 

 

 

16,839

 

Acquisition-related and integration-related costs

 

 

538

 

 

 

774

 

 

 

746

 

 

 

1,750

 

Non-deferred IPO and secondary offering costs

 

 

 

 

 

316

 

 

 

1,031

 

 

 

754

 

Debt modification costs

 

 

 

 

 

 

 

 

 

 

 

288

 

Adjusted Operating Income - Non-GAAP

 

$

49,270

 

 

$

47,415

 

 

$

129,648

 

 

$

72,427

 

As a % of net revenue - GAAP

 

 

7.3

%

 

 

9.6

%

 

 

10.2

%

 

 

7.2

%

As a % of net revenue - Non-GAAP

 

 

10.4

%

 

 

12.5

%

 

 

12.9

%

 

 

10.5

%

 

 

Non-GAAP Net Income and Net Income Per Share Reconciliations

(Unaudited, in thousands, except per share amounts and percentages)

 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income - GAAP

 

$

27,745

 

 

$

22,600

 

 

$

74,468

 

 

$

23,817

 

Acquisition accounting impact related to recognizing acquired

   inventory at fair value

 

 

 

 

 

(27

)

 

 

 

 

 

394

 

Change in fair value of contingent consideration for business

   acquisition

 

 

21

 

 

 

 

 

 

93

 

 

 

 

Non-cash inventory impairment

 

 

518

 

 

 

 

 

 

518

 

 

 

 

Stock-based compensation

 

 

4,768

 

 

 

1,550

 

 

 

7,844

 

 

 

2,655

 

Intangible asset amortization

 

 

8,712

 

 

 

8,392

 

 

 

17,414

 

 

 

16,839

 

Acquisition-related and integration-related costs

 

 

538

 

 

 

774

 

 

 

746

 

 

 

1,750

 

Non-deferred IPO and secondary offering costs

 

 

 

 

 

316

 

 

 

1,031

 

 

 

754

 

Debt modification costs

 

 

 

 

 

 

 

 

 

 

 

288

 

Loss on debt extinguishment

 

 

358

 

 

 

392

 

 

 

797

 

 

 

392

 

Non-GAAP income tax adjustment

 

 

(6,970

)

 

 

(1,717

)

 

 

(9,059

)

 

 

(3,432

)

Adjusted Net Income - Non-GAAP

 

$

35,690

 

 

$

32,280

 

 

$

93,852

 

 

$

43,457

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted Net income per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  GAAP

 

$

0.28

 

 

$

0.26

 

 

$

0.74

 

 

$

0.28

 

  Adjusted, Non-GAAP

 

$

0.36

 

 

$

0.37

 

 

$

0.94

 

 

$

0.50

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares used to compute diluted net income per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  GAAP

 

 

100,074

 

 

 

86,333

 

 

 

100,145

 

 

 

86,201

 

  Adjusted, Non-GAAP

 

 

100,074

 

 

 

86,333

 

 

 

100,145

 

 

 

86,201

 

 


 

Corsair Gaming, Inc.

Adjusted EBITDA Reconciliations

(Unaudited, in thousands, except percentages)

 

 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income - GAAP

 

$

27,745

 

 

$

22,600

 

 

$

74,468

 

 

$

23,817

 

Acquisition accounting impact related to recognizing acquired

   inventory at fair value

 

 

 

 

 

(27

)

 

 

 

 

 

394

 

Change in fair value of contingent consideration for business

   acquisition

 

 

21

 

 

 

 

 

 

93

 

 

 

 

Non-cash inventory impairment

 

 

518

 

 

 

 

 

 

518

 

 

 

 

Stock-based compensation

 

 

4,768

 

 

 

1,550

 

 

 

7,844

 

 

 

2,655

 

Acquisition-related and integration-related costs

 

 

538

 

 

 

774

 

 

 

746

 

 

 

1,750

 

Non-deferred IPO and secondary offering costs

 

 

 

 

 

316

 

 

 

1,031

 

 

 

754

 

Debt modification costs

 

 

 

 

 

 

 

 

 

 

 

288

 

Intangible asset amortization

 

 

8,712

 

 

 

8,392

 

 

 

17,414

 

 

 

16,839

 

Depreciation

 

 

2,502

 

 

 

2,206

 

 

 

4,938

 

 

 

4,364

 

Interest expense (includes loss on debt extinguishment)

 

 

4,508

 

 

 

9,575

 

 

 

9,454

 

 

 

18,946

 

Tax expense

 

 

2,285

 

 

 

4,249