Is This an Overreaction to Corsair’s Earnings?

Corsair (NASDAQ:CRSR) reported earnings on August 3 before the market opened. In today’s video I look at Corsair’s earnings report and talk about some of the strong and weak points presented to investors. Here are some highlights from the video:

  1. Corsair reported 24% year-over-year (YOY) revenue growth in second-quarter 2021 earnings. The increase was driven by 40.9% YOY revenue growth in its gamer and creator peripherals segment and 17.6% YOY revenue growth in its gaming components and systems segment.
  2. One of the most prominent yellow flags investors might have is that Corsair’s adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) grew only 4% YOY even though revenue grew 24% YOY. The main reason is an increase in logistics costs, including ocean and air freight. 
  3. Corsair ended the quarter with total debt of roughly $274 million and expects to reduce its debt by $100 million in the full year 2021. Corsair also provided investors with no change in guidance and expects to see YoY revenue growth in the low teens for full-year 2021.

Click the video below for my full thoughts and analysis. 

*Stock prices used were the midday prices of August 3, 2021. The video was published on August 3, 2021.

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This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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