Turtle Beach (HEAR) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue reached $76.5 million, up 59% year-over-year, driven by PDP integration, organic growth, and strong product demand.

• Gross margin improved by 540 basis points to 30.2% (34% excluding one-time charges), reflecting cost optimization and new product launches.

• Adjusted EBITDA for Q2 was $3.0 million, a turnaround from a $5.7 million loss in Q2 2023.

• Net loss narrowed to $7.5 million ($0.35 per share) from $15.9 million ($0.93 per share) in Q2 2023.

• Announced the retirement of CFO John Hanson and completed the largest share repurchase in company history: $15.2 million in Q2.

Financial highlights

• Q2 2024 revenue: $76.5 million (up 59% YOY); organic growth excluding PDP was 15%.

• Gross margin: 30.2% (GAAP), 34% (adjusted for non-recurring items); Q2 gross profit: $23.1 million.

• Adjusted EBITDA: $3.0 million in Q2 2024 vs. $(5.7) million in Q2 2023.

• Net loss: $7.5 million in Q2 2024 vs. $15.9 million in Q2 2023; diluted EPS: $(0.35) vs. $(0.93).

• Net debt at June 30, 2024: $61.2 million (borrowings $73.6 million, cash $12.5 million); inventory: $73.3 million.

Outlook and guidance

• Full-year 2024 revenue guidance maintained at $370–$380 million, representing 43–47% growth over 2023.

• Full-year adjusted EBITDA guidance raised to $53–$56 million, up from $51–$54 million.

• Guidance includes PDP contributions from March 13, 2024.

• Long-term targets: 10%+ revenue CAGR, mid-high 30s gross margin, 15%+ adjusted EBITDA margin.