Cherry (C3RY) Q1 2026 earnings summary

Executive summary

• Revenue declined 17.8% year-over-year to EUR 20.8 million in Q1 2026, mainly due to weak demand in Gaming & Office Peripherals and ongoing strategic realignment.

• Adjusted EBITDA improved to EUR -0.6 million (margin -2.9%) from EUR -2.0 million (margin -8.0%) in Q1 2025, reflecting cost discipline and improved gross margin quality.

• Major milestones include improved OPEX control, positive free cash flow, and the launch of Project Blossom targeting EBIT break-even in 2027.

• Net loss narrowed to EUR -4.0 million from EUR -5.8 million year-over-year, driven by reduced operating costs and lower depreciation.

• Peripherals transformation is underway, with divestment of DH & S progressing and organizational streamlining in focus.

Financial highlights

• Q1 2026 group revenue was EUR 20.8m, down 18% year-over-year from EUR 25.3m, mainly due to extraordinary items and FX headwinds in Peripherals.

• Gross margin increased to 46.7% from 43.7% year-over-year, reflecting better pricing and product mix.

• Like-for-like, DH & S revenue more than tripled after excluding divested hygiene KB business.

• Free cash flow swung positive to EUR 1.1m, a year-over-year improvement of EUR 10m.

• Cash and cash equivalents at quarter-end were EUR 4.7m, down from EUR 5.6m at year-end 2025.

Outlook and guidance

• No updated forecast issued; management cites ongoing M&A process and incomplete 2025 financials as reasons for withholding guidance.

• Project Blossom targets EUR 8m in additional cost reductions and EBIT break-even by 2027.

• DH & S segment is well-positioned in the German e-health market, with recurring revenue and strong regulatory-driven demand.

• Peripherals business transformation aims for a leaner, scalable model with higher margins and cash generation.

• Management expects to provide full-year guidance after closing ongoing M&A processes.