Revenue contraction and aggressive inventory clearance efforts caused gross margins to plummet to 22.0% in 2026Q1, down from peak levels of 40.1% in 2025Q4.
| Sales/Revenue | 298.19M | 319.91M | 372.77M | 258.12M | 240.17M | 366.35M | 360.09M |
| Revenue Growth % | -21.7% | -14.18% | 44.41% | 7.48% | -34.44% | 1.74% | - |
| Cost of Goods Sold | 194.98M | 200.63M | 243.78M | 182.62M | 190.98M | 237.97M | 226.31M |
| COGS % of Revenue | - | 62.71% | 65.4% | 70.75% | 79.52% | 64.96% | 62.85% |
| Gross Profit | 103.21M | 119.28M | 128.98M | 75.5M | 49.19M | 128.38M | 133.79M |
| Gross Margin % | 34.61% | 37.29% | 34.6% | 29.25% | 20.48% | 35.04% | 37.15% |
| Gross Profit Growth % | - | -7.52% | 70.83% | 53.5% | -61.69% | -4.04% | - |
| Operating Expenses | 96.56M | 99.75M | 108.95M | 91.95M | 100.67M | 107.95M | 84.62M |
| OpEx % of Revenue | - | 31.18% | 29.23% | 35.62% | 41.92% | 29.47% | 23.5% |
| Selling, General & Admin | 80.93M | 82.86M | 80.82M | 74.81M | 79.65M | 90.46M | 72.36M |
| SG&A % of Revenue | - | 25.9% | 21.68% | 28.98% | 33.16% | 24.69% | 20.09% |
| Research & Development | 17.47M | 16.89M | 17.3M | 17.14M | 19.12M | 17.49M | 12.27M |
| R&D % of Revenue | - | 5.28% | 4.64% | 6.64% | 7.96% | 4.77% | 3.41% |
| Other Operating Expenses | -524K | 0 | 10.83M | 0 | 1.9M | 0 | 0 |
| Operating Income | 6.64M | 19.54M | 20.03M | -16.44M | -51.48M | 20.43M | 49.17M |
| Operating Margin % | 2.23% | 6.11% | 5.37% | -6.37% | -21.44% | 5.58% | 13.65% |
| Operating Income Growth % | - | -2.45% | 221.81% | 68.06% | -351.97% | -58.45% | - |
| EBITDA | 18.84M | 31.97M | 31.42M | -11.6M | -45.66M | 25.74M | 54.41M |
| EBITDA Margin % | 6.32% | 9.99% | 8.43% | -4.5% | -19.01% | 7.03% | 15.11% |
| EBITDA Growth % | -53.26% | 1.74% | 370.77% | 74.59% | -277.38% | -52.69% | - |
| D&A (Non-Cash Add-back) | 12.2M | 12.43M | 11.39M | 4.84M | 5.82M | 5.31M | 5.25M |
| EBIT | 12.01M | 19.54M | 18.74M | -16.84M | -53.23M | 20.53M | 52.92M |
| Net Interest Income | -9.13M | -9.77M | -8.07M | -504K | -1.22M | -383K | -467K |
| Interest Income | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Interest Expense | 9.13M | 9.77M | 8.07M | 504K | 1.22M | 383K | 467K |
| Other Income/Expense | -4.4M | -2.74M | -9.36M | -898K | -2.97M | -282K | 3.29M |
| Pretax Income | 2.25M | 16.8M | 10.67M | -17.34M | -54.45M | 20.15M | 52.46M |
| Pretax Margin % | 0.75% | 5.25% | 2.86% | -6.72% | -22.67% | 5.5% | 14.57% |
| Income Tax | 1.06M | 1.07M | -5.51M | 338K | 5.09M | 2.43M | 13.71M |
| Effective Tax Rate % | 47.06% | 6.37% | -51.64% | -1.95% | -9.35% | 12.05% | 26.14% |
| Net Income | 1.19M | 15.73M | 16.18M | -17.68M | -59.55M | 17.72M | 38.75M |
| Net Margin % | 0.4% | 4.92% | 4.34% | -6.85% | -24.79% | 4.84% | 10.76% |
| Net Income Growth % | -92.26% | -2.79% | 191.54% | 70.31% | -436.02% | -54.26% | - |
| Net Income (Continuing) | 1.19M | 15.73M | 16.18M | -17.68M | -59.55M | 17.72M | 38.75M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| EPS (Diluted) | 0.06 | 0.77 | 0.78 | -1.03 | -3.62 | 0.97 | 2.37 |
| EPS Growth % | -95.31% | -1.28% | 175.73% | 71.55% | -473.2% | -59.07% | - |
| EPS (Basic) | - | 0.78 | 0.81 | -1.03 | -3.62 | 1.11 | 2.62 |
| Diluted Shares Outstanding | 19.5M | 20.46M | 20.83M | 17.14M | 16.45M | 18.25M | 16.36M |
| Basic Shares Outstanding | 19.5M | 20.26M | 20.02M | 17.14M | 16.45M | 15.91M | 14.8M |
| Dividend Payout Ratio | - | - | - | - | - | - | - |
Severe seasonal revenue volatility
As reported in recent financial statements, Turtle Beach experienced a sharp 34.0% year-over-year revenue decline in 2026Q1, signaling a significant deceleration from the growth observed in previous periods and highlighting the company's sensitivity to post-pandemic normalization and the absence of major gaming hardware catalysts.
The consistent revenue decay across recent quarters suggests that the company is struggling to maintain its top-line momentum in a post-pandemic environment. Investors should monitor whether this trend represents a structural loss of market share to integrated console audio solutions or merely a temporary lull in the hardware replacement cycle.
Based on the provided income statement data, gross margins plummeted to 22.0% in 2026Q1, a stark departure from the 37% to 40% range seen in prior peak periods, suggesting that promotional discounting and inventory clearance efforts are severely eroding the company's core pricing power.
The inability to sustain gross margins above 30% in recent quarters indicates that the company may be forced to sacrifice profitability to move aging inventory through retail channels. This margin compression warrants further investigation into whether the current product mix is fundamentally less profitable than historical offerings.
According to the company's income statement, operating income swung to a loss of $13.8 million in 2026Q1, demonstrating that fixed costs are not scaling efficiently with declining revenue and creating a significant drag on the company's overall financial performance during periods of lower demand.
The transition from positive operating income in 2025Q4 to a substantial loss in 2026Q1 highlights the risks inherent in the company's high-variable cost structure when volume drops. This lack of operating leverage suggests that the business model remains highly sensitive to even minor fluctuations in quarterly sales volume.
Data from the last ten quarters reveals a pattern of extreme seasonal reliance, where the company's profitability is almost entirely dependent on fourth-quarter performance, raising concerns about the long-term viability of its business model outside of the holiday gifting season as reported in recent filings.
Short-sellers would likely focus on the recurring quarterly operating losses that appear outside of the peak holiday season, which suggest that the company's core operations may not be self-sustaining on a year-round basis. This pattern implies that the business may be trapped in a cycle of seasonal inventory build-up and subsequent margin-diluting liquidation.
Quick answers to the most common questions about buying TBCH stock.
For fiscal year 2025, Turtle Beach Corporation (TBCH) reported total revenue of $319.9M. This represents a 11.2% decline compared to $360.1M in 2020.
Turtle Beach Corporation (TBCH) is profitable, generating $15.7M in net income for the fiscal year ending 2025 with a net profit margin of 4.9%.
Turtle Beach Corporation (TBCH) reported an operating income of $19.5M, resulting in an operating profit margin of 6.1%. This margin reflects the operational efficiency of the business before interest and taxes.
Turtle Beach Corporation (TBCH) generated $119.3M in gross profit for the year, representing a gross profit margin of 37.3%. This demonstrates the company's core pricing power and production efficiency.