Corsair Gaming, Inc., known for its computer peripherals and hardware, announced on Monday the completion of its acquisition of the Fanatec Sim Racing product line from Endor AG. This acquisition, which officially closed on Thursday, includes not only the products but also the team at Endor AG responsible for the Fanatec brand, which specializes in high-end simulation racing equipment.
Fanatec's product range is well-regarded in the gaming community, offering force feedback steering wheels, wheelbases, pedals, shifters, and other accessories compatible with PlayStation, Xbox, and PC racing simulators. The integration of Fanatec's offerings into Corsair's portfolio is expected to enhance the company's position in the gaming peripherals market.
Corsair Gaming, headquartered in Milpitas, California, has been expanding its product lineup and market reach in recent years. The acquisition of Fanatec's sim racing line is a strategic move to diversify its offerings and tap into the growing market of esports and simulation racing.
The financial terms of the deal have not been disclosed, but the acquisition is a clear indicator of Corsair's commitment to broadening its gaming hardware spectrum.
Fanatec is a respected brand based in Landshut, Germany, with a strong presence in the sim racing community, and its integration into Corsair's suite of products is likely to be well received by enthusiasts of the genre.
In other recent news, Corsair Gaming reported a decrease in net revenue for the second quarter of 2024, dropping to $261.3 million from $325.4 million in the same quarter last year.
Despite the dip, the company's gamer and creator peripheral segment experienced a 20% year-over-year growth, attributed to successful product launches. Additionally, Corsair announced cost-saving measures, including a reduction of approximately 100 employees and cuts in external expenses.
Corsair revised its full-year 2024 outlook, expecting revenue between $1.25 billion and $1.35 billion, and adjusted EBITDA between $60 million and $75 million.
The company has also entered into an exclusive multi-year partnership with the Call of Duty franchise, integrating Corsair's family of brands with the popular gaming series. This partnership aims to provide gamers with a comprehensive gaming experience tailored to the franchise.
Corsair Gaming has also announced its definitive agreement to acquire the Fanatec Sim Racing product line from Endor AG. This strategic move marks a significant step for Corsair as it continues to diversify its product range and invest in high-growth areas of the gaming industry.
InvestingPro Insights
In light of Corsair Gaming's recent acquisition of Fanatec Sim Racing, current market metrics and analyst insights from InvestingPro provide a deeper understanding of the company's financial health and stock performance. As of the last twelve months leading up to Q2 2024, Corsair has faced challenges with a revenue decline of 0.78%, and a significant quarterly revenue drop of 19.71%. This aligns with analyst expectations of a sales decline in the current year. The company's market capitalization stands at $675.91 million, reflecting the scale of the business post-acquisition.
Despite these challenges, there are positive signs. Corsair's liquid assets exceed short-term obligations, indicating a solid liquidity position that could support integration costs and future investments. Furthermore, while the company has not been profitable over the previous twelve months, analysts predict Corsair will turn a profit this year, which could signal a turnaround as the acquisition is integrated.
Investors should note the stock's volatility and significant price drop over the past year, with a 54.35% decline in the one-year price total return. This may present a buying opportunity for those who believe in the long-term strategy of the company, especially considering that the InvestingPro Fair Value estimate is $7.12, higher than the previous close price of $6.66.
For those seeking additional insights, InvestingPro offers further tips on Corsair Gaming's stock performance and projections, with a total of 11 additional InvestingPro Tips available for review.
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