Investing.com -- Corsair Gaming is expected to report lower-than-expected revenue in the second-quarter, pressured by softer demand for PC gaming hardware.
For the three months ended June 30, the gaming products maker said it expects preliminary unaudited revenue to be approximately $261 million, well below Wall Street estimates of $308 million.
The weaker forecast comes as the company conceded that the "market for high-end self-built gaming PCs continues to be softer than expected," as consumers wait for new GPUs to be launched at year-end.
While the uptick in demand for entry-level market products including lower-cost GPUs and CPUs has seen good activity, the company added, the lower price of these products has lowered the average selling price for some of the component categories it sells, pointing to weaker margins.
The weakness in its components business "has been far worse this year than we and investors had anticipated," Wedbush said in a Friday note.
This weakness has resulted in disappointing results for revenue and margins, the company said, though expects a recovery in the second half of 2024 and 2025.
The challenging backdrop over past year has seen Corsair lose market share as the company opting out of cutting prices to boost demand, Wedbush said.
The challenge for Corsair over the coming weeks and months will be to "prove to investors that it did not permanently lose market share by attempting to preserve its premium status over the last year," Wedbush added.
Corsair Gaming Inc (NASDAQ:CRSR), which is down 38% year to date will report earnings on Aug. 1.