Turtle Beach (HEAR) 6 Aug 212021 Q2 Earnings call transcript

Good afternoon, ladies and gentlemen, and welcome to the Turtle Beach Second Quarter 2021 Conference Call. Delivering today's prepared remarks are Chairman and Chief Executive Officer, Juergen Stark; and Chief Financial Officer, John Hanson.

Following their prepared remarks, the management team will open up the call for any questions.

Before we go any further, I would like to turn the call over to Alex Thompson of the Gateway Investor Relations, Turtle Beach IR Adviser, as he reads the company's safe harbor that provides important cautions regarding forward-looking statements. Alex, please go ahead.

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audio We yet. our Air Turtle PC top brands. also premium all-new gaming our patent mix announced wireless and PC engineering of among which Air expertise ROCCAT's award-winning ROCCAT's elevates wireless it's the Pro design has and headset best our Syn offering gaming perfect Syn German The further with technologies, become headsets, Beach's Pro and

market these PC expanding gaining portfolio rose versus our and Cone going share PC the U.S. the mice, that by excited in gaming half billion our of illustrate of XX% XXX% expanding fantastic membrane PC Magma impact retailers sales XXXX in sales mechanical about ROCCAT the time. $X.X is grew These XXXX. hit keyboards, accessories line in PC NPD demand products. quarter. approximately and like that high award-winning headsets, same progress mice reported the as of and during Pro well. all-new of that the pyro accessories Our We're keyboards first Rocket in approximately really of products really numbers

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analog microphone in entering the fans the price best Next, with long-awaited multiple team which and at products the first King Bee this multiple is market II level excited. we're the our is II $X.X release of musicians King XLR as microphone, streaming about global Bee of and amongst in points. billion and of microphone all-new redefining the USB announced digital the performance team quality already year. Neat acoustic artists very known excited category, recording and We're microphones the launching in the well microphones Neat and analog

console new announced done categories, strong They we've integrate upgrade entry great our hardware. to console amazing users entry immersive know across addition audio gamers. competitive, products controller. to and game us flight their with product with into our to is and designed with great our new patented into while controller how products The natural brand fit that gaming make gamers playing controllers is adding and experience our We've our that and the for market deliver audio more we capabilities Recon In more a simulation controller. we existing our a unique millions of given headset our enable to

the controller for hearing gamers helps been have exclusive providing huge rave and demonstrated reaction controller roughly superhuman with win. $XXX the course, positive, headset, and The is market Recon million. advantages base. has significant We game The controllers Superhuman a recent reviews. includes competitive installed in the have patented third-party very games. which received that Of estimate Hearing as controllers pad any capability, our headsets a but our works study

So a big opportunity for us. that's

and demand records despite realism Simulation our into I Xbox. the and announced saw flight also coming on we year. simulation. would on the both Indeed, semiconductor with experienced and that it the a earnings Microsoft where PlayStation PC and demonstration and difference be a to cards the and commented market to it for Once these change would between System from graphics happened the games benefit flight prerelease last Sim a this also was consoles high for Flight point constraints. that drive early consoles. simulation new a that clear. that We entry last step VelocityOne Xbox year Flight step the XXXX controller greatly racing in level advancements call to PCs difficult be with with setting upcoming I learned our year new believe opportunity year, for realism also our consoles of reality of the notice has that the can launched ago improvement change be Xbox

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and to sign-ups these simulation confident flight product us as that's I'm certainly billion racing which Over an be Together, e-mail additional two the XX,XXX will is So, category adds products, tag. already including for million in this will market, start. $X excellent market into another move. categories a great The not controller new $XXX addressable notification in prove to add branch future well.

by to revenues could launching So, large expanding grown in I $XXX it two microphones revenues PC outside next PC expanding the million portfolio Adding we portfolio just historical exciting simulation hardware into console our we've and years, at ROCCAT year. over this markets, accessories of in approach even together, or core headset in our all we game that the controller into our be gaming when business is Neat category. year. since And look now significantly expect

technology progress and the our on rest excellent delivering accessories expect being products well after in out more leader, our to and how innovations. strategic some our I'll how results leveraging with QX thoughts year gaming covers a cutting-edge are We gaming of play decade-plus the John our of on the provide to goals and we on the John? high-quality financial gaming market, way detail.

afternoon, and Hey, thanks, Juergen, good everyone.

excellent to noted, our quarter, of XXXX. quarter second are the exceeding Jorgen during pleased As report guidance we another internal

also $XX.X is particularly XXXX Given performance revenue given was year-to-date the peers. the million, and which dynamics alongside outpaced XXXX, our second providing quarter quarterly our XX% relevant of unusual This flat million QX of are to far year for we the ago quarter record second in quarter. roughly the XXXX revenue in in XXXX, growth $XX.X our Net summary.

ocean leverage to year changes of XXXX. quarter Lower great million a compared more more second mix, with $XX.X and XX.X% in in air freight of us XXXX half expenses a higher costs compared in and normalized up start XXXX. to was fixed in a land-based Gross return First were revenue XX% offset same ago second Operating XX.X% cost freight the quarter $XX.X and margin the quarter XXXX to second the of providing slightly period, of million costs. reported compared the promotional were to year. business net in of by spend level was to the our quarter

Our revenues XXXX. business is than higher on track for XX%

in Adjusted ago our aforementioned enter million PC business to XXXX second million our launches market our productively the OpEx heavily also big larger support $X QX than business. to and are to the So categories. and increases product in was the a and of investments reflecting $XX.X to just quarter, marketing these year investing We're resources normal larger to the quarter of EBITDA categories the were new stream accessory product more infrastructure and of given the in driver expenses new weighted expand required the business discussed. compared we accommodate

$X.X adjusted period. XX% net GAAP year income was up $X.X half compared First XXXX ago year EBITDA compared to to in million was the in the quarter. second ago of million quarter the

the diluted through of credits, million in XXX% ago share the or of effective ago quarter recognition was per full year $XX.X rate $X.XX the expect and net per we includes weighted to diluted operations per tax intentional $X.X quarter I'll XXXX second income of income the of per million in up ensure quarter. on weighted quarter. XX.X of share in to share the $X.XX period. our for million which income Cash increase year million the was half year compared to second a XX%. a to compared outstanding in the XXXX $XX.X of share shares charges to GAAP quarter million discuss Adjusted to momentarily. approximately net $X.XX average second diluted was of supply the big the customers, XX.X in XXXX. $X.XX compared certain diluted shares driver XXXX to QX XXXX tax million is net A $X.X income flow First ago change outstanding or will inventory share which year here of compared net flow the second in a average on was from quarter

balance sheet. to turning Now the

cash equivalents million credit That's debt, million compared XX, a XXXX. XXXX as from million the As improvement of and net June on XX, $XX.X no XXXX. as of including Inventories December June on XX, had our borrowings XXXX, million cash were and $XX of revolving X to $XX of end $XX of XXXX, June million June $XX with we XX, line.

help QX year's other semiconductor chain increase this were to global unusually global inventory bottlenecks start, low. ending and ensure To potential and last year operational freight risks. intentional of was Now logistics our light but shortages, an supply levels supply in inventory strategy

Jorgen? back retailers We supply. ensure some continue the to for seen help have and earlier over to own additional to now comments. also to I'll expect turn Juergen see call And their ordering

Thanks, John.

as presentation see continue earnings rich gaming these a of We long-term with trends. benefiting multiple tailwinds. has from a market opportunities good The summary and to

So, the as strategy business, we of we're executing focused tailwinds. advance our advantage our on take to maximum

very As I mentioned, well. tracking we're

U.S. we're the evidenced new top First, demand continue as the $X.X XX strong the gaming ability to lead continuing. to and headset, innovation products to billion by in revenue the XX headsets console see With Recon of XXX drive continuing we the category.

fact the they excited consoles will how that new both Moving as announced us shortages has despite the forward, Xbox recede. sales see of PlayStation supply shortages record perform and to those

we're Second, I've it times already up we're but in roughly and ROCCAT drive that net and $XX products progress, some closed expanding portfolio generated getting accessories that XXXX continuing of at deliver end fact covered ROCCAT our PC an will and million have here's sums compelling deal nicely. just already unique rapidly growth. to examples gaming interesting more than the seven price and We really the of the May purchase started. revenues, our

We'll entering Third, mic microphones, we through billion upcoming categories new need before of addressable controllers mics. $X.X $X launch time soon of the entered over and organically, M&A. with new billion acquisition market. and/or professional first simulation for of portfolio gaming - with another and in as game And enabling our we're streaming addition the of organically global we've I described entered in hardware, addressable market products

billion billion. I Back to that headset Importantly, acquisition, XXXX, essentially $X.X console stated in to revenues when two goal million we ROCCAT products incremental $XXX our markets first reach over in the now in we've from our last business. cover the outside core increased announced the our that was years, $X

As hit I before, year, a target already to mentioned a anticipated. that or have had so possibility earlier we than year we next

$XXX the these maintaining our guidance. as into million of have we great extent and been are In the that see the logistics that dynamic challenges strategy how on of widely outlook year situation. working, to variables remainder we playing very again, a Despite semiconductors and these we continued is we the revenue illustration the and a out, note challenges factored possible, terms given of our publicized,

the make accessories in plans to PC constraints semiconductor are headset come new console our difference. the above several the and back holding and focused up categories are products, While our

and specific the we XX% peers I revenue our by based of EBITDA response believe this console and very maintaining this EBITDA we're the year margin and for this in size. significantly rest supply to competitors the $XX a a excellent when growth rapid sell-through our than posted our just more as position includes somewhat outpaced example. $XXX We're also In market year we posted a XXX% year-over-year U.S. factor growth. So, continue we're over from guidance particularly of X% the increased headset to a QX, to where XXXX, our we last given target at reaffirming in favorably of revenue million, pleased and our outperformed be on where execution. growing X, considering particular, target compares that our million smaller operational XX% peers, do and market to

are significant adjusted and constraints ocean will freight and how maintaining bottlenecks mitigate to shortages and the our are on will cost, global EBITDA inland the and maintaining months costs, of logistics. EBITDA significant depend while the outlook, reflecting freight coming of we which outlook, shipping extent partially our This we're ability temporary evolves forecasting create incremental land-based in containers, We situation adjusted on incremental the least our impacts. at capacity

issues side, are could shortages, broadly. with and impacting competitive produce promotional know flip And the On combined these our levels. may industry lower spending we which supply issues in result semiconductor more

So strive there well and as to puts we our we guidance our the market, unusual light past. and execute done are as And in operational of holding challenges always, in the dynamics we've when in are EBITDA takes.

expecting to be For the revenue adjusted second approximately half we're and of to $XXX million. be $XX million the year, approximately EBITDA

outperformance more build we XXXX like and cause to than contributed the of a particularly to ensure This to which QX continue in did, looked seen mentioned, own QX retailers to last unusual year. to significant to expect have supply. just continue like I XXXX inventory and As given earlier and have phasing, QX order quarterly their our likely market, will QX,

annual in individual continue comparing than by said, annual roughly years. progress investors rather trying to we focus unusual to on towards That quarters of recommend revenue that we gauge for XX% our estimate our be QX. two results to So

always, Of the totals. the given shipments half late split September QX, and second October into around could revenue QX move impacting course, as without of velocity high

focused we pleased delivering rate time company where very growth positioned and with of XX% remain on EBITDA the margins. category-leading driving over are today, while revenue We XX% goal is to our

our well growing we're formula goals, financial tracking on how a think we for great Given and shareholder value. that's strategic

global Delivering continued supply Finally, of chain team's as the their our ability these state constantly questions. world the Beach filled entire of what to their I'm Turtle for thank that we're given and strong drives challenges. unusual a I'm for execution. ready situation, the our to with the with another continually of grateful well I result is these and talent very want to our challenges team as people impressed days and Operator, focus quarter overcome is products us forward. quality dedication take now and as

Thank you, Drew Stifel. with Our first sir. [Operator will from question come Instructions] Crum

proceed. Please Your line open. is

guys. thanks. Okay, Good Hey, afternoon.

called Juergen, So, you out the…

Hi, Drew.

Hi.

the what normalizing? the the out semiconductor whether impact a is And called anticipate company's And the when it's on there then sales, business. way an You you have exposure is supply-demand follow-up. Is would percentage size imbalance a to of a shortage then having this? to I

Sure.

categories because cases, tough in constraining as on the as changing our to to - It's A wireless promotional we've, multiple holding headsets of stocking some products. basically been So, advance are sales of in semiconductors But in to already a so because of It and giving bit than categories. then ourselves off literally stockouts including powered the revenue issues passive terms it semiconductors, started affects products avoid out and passive of products electronics very extent, lot activities of in I in and we in fall we've been we for and quite last result. that headsets that all believe it's responding, on driving some those quantify rather pulses more year. everybody affecting knows, the expect some ball and out. sales the hard expected essentially. and are that can continue quantify supply example, a will

to important in anticipated $ note, constraints - also the We supply million. we've the XXX

logistics, the early half from depend how will last guidance and we're and we out semiconductors in and the earnings despite So of then early for revenue also constraints the year the come how that the call the play second how had in updated on frankly, year. moves that holding proceed in to

expect essentially. expecting we're XXXX. we continue long - how planning Right now, it into asked accordingly to also semiconductor You that's And to we're Yes. constraints continue

Okay. you you to follow-up, number get you Is share that a EBITDA And us mentioned that range on then with to industry-leading there my margins. aspire specific adjusted a metric? or can

category-leading was company XX% goal peer good in We upped continue going Yes. at the is XX%. think our EBITDA felt hit to to We future competitive and it space. try financial while margin And last industry-leading call. which think And started that's as our planning, our EBITDA we to peers EBITDA business XX% We range. the to target earnings a in will forward, that EBITDA increased for comp investing we the good in a or drive public very year margin, our I very margin. growth. a that's

However, operating to as coming over and EBITDA should up we that we do years margin get grow creep time. the modestly expect, over that leverage continue

it. Got

Okay. Thanks, guys.

Thanks, Drew.

Argento question The Mark in from queue next Lake Street. from the comes

and Please Your Jorgen Argento Q Mark line is - open. John. proceed. Hey,

down non-console revenue little you you're thinking Could headset ones XX Just incremental bit that again us million out in the in here. going months. as you $XXX you've other could PC that Is predominantly a break terms you're The couple actually for be segments? quick achieve a the think of move do categories the well? to of and it overall needle could got Mike accessories? some you into Or potentially

Yeah. question. Good

that sim the at products, in new. that. next expanded and like Mics Consumers those again, will expect year. is essentially the start the testament given a kind also years. of That $XXX expand both well, That that all That to a going would products, next is over new category. already. grow category the very great be got in well. goal year, We coming others. the also two to category PC that's But each now are portfolio have the also strategy a are of of expected flight categories. I So working single hadn't first the to portfolio. year majority million, right shot that has Controllers or the head in of products PC with a will the we've portfolio

be it. astounding, part will that We've sign-ups a of on Xbox the given Flight continued to the tell we've I sim has It's for flight on our indication you forecast think notification controllers. and the rapidly, smaller But clear when the sim. particularly just it's to this will I SIM, a comes of I XX,XXX on it controllers, forecast grow mentioned $XXX increased it's increased especially for product, e-mail that but So year market that recently flight as has. year a

so could meaningful next those be contributors year. And

Or And you appreciate on of back said forward? does up for rate in that housekeeping, this color. you then super year. the just I That's more going XXXX? that kind tax new bump helpful expect you rate, XX% the anticipate John, that. Do is

to up Yes, bump it at here this year. this level I point, more would to after XX% to back expect the

Great. And last just then one. one

something strategy, it going more a you do maybe to organically kind strategy organ acquisitions could platform, to been would tuck-ins? to anticipate be you your leverage tuck-in the chunky look find of terms if In more little of more distribution. Do continue historically and target? grow, you a the that's good Or then the M&A

we where We the be be in hard that SIM with indicator medium say, If team price would sized, the would we'll tuck-in to generated well That's at categories. a pretty controllers. we years Mark. do I to it ROCCAT find, revenues the purchase and things product buy those do Xx in a two hired already acquisition, organically, then decades and would Flight our a the fair I and has slightly to can of game, ability point acquisition. which for small I of everything would leverage and just though, over as more versus us experience we've is good is have say

selective. for is calls, build - very prior business the And stuff. fair in comment don't smaller they really good big right, reiterate to good team a The we're team's has to generate not made to the off But got spend. return for the be got M&A. good big If If and and attractive any I'll right. just to will to reputation economics be we looking pursue game. got can So right and we existing everything products, I - they're an quality have acquisition we're I us culture be a be have and a

Thanks, good on a guys. Great. Congrats quarter.

Great. Thanks, Mark.

Forte question the from with And next D.A. Davidson. comes Tom

Your proceed. Please line is open.

Thanks. quarter. Congrats the Great. on

high Just granular semi questions level. one more and two

So I'll start two. with the

you tip the the supply quarter - it's do chain the like the can feel transitory? inflation higher of Juergen, and that said of then on quarter? the better first or gotten how and that about So on just to you talk And then I is is do front, second challenges, talk you I And when about shortages second kind you between sound you or the think related apologize much logistics directionally, permanent? like there. costs do the containers. it's it's Or think worse

those. of address freight, variety a there Great. issues. of On I'll are both Tom,

First are are U.S. up the all, imports like imports something U.S. significant up China of into into or the XX%. Asian

capacity So that's already shipping of a strain of of on containers ports. and

Second problem COVID occasionally time. and are to are least unloaded ports bottlenecked, down shut those periods for reduced ocean loaded parts is to get getting having freighters are at that or of facing because capacity and wait by

essentially as X now impact as inventory But way, in business, weeks. sitting X work by ships to waiting take unloaded them. creates that that get weeks an soon because used expect containers period, you'd a also that those That's to and take the might here up something X on everybody's So or ties in reloaded. waiting on process get products don't

cost have the containers. those two, factor. So in a month last in major the major, a factors rapid of or increase driven That's

thing that second congested. also The rail is is

So congested is where at down. rail sometimes inland highly shutting freight point the yards are

having And other containers to ways doing businesses to that, it's get we're into our more we're our other many but expensive. So like warehouses. find just

the into things second half these situation annual and The is factor forecast. to dynamic. the tried we've So very forecast

over a working As usual, of working operationally got team to already for all believe ways have levels, I to - optimize that is mitigate all that. expenses, been to inventory we've find and months

So we've to That's be held in we could that and supply stock the reduction also a some and to positive, there outperform our and that drive could that freight by EBITDA semiconductor. guidance, the frankly, sim out levels also, a in EBITDA. knowing way, competitors the on extent promotional advantages

follow-up. my I've Great.

last have months. Tom, semiconductors, We see right the over now. stable been Yes, relatively better getting don't it

terms expectations are of to assure actually engineering supply... we're our an - we're in exercise to effort, in tracking semiconductors, we needed what would flexibility continued the we order help swap out we to to get We is And by continuing which where getting. thought way,

right. then might when important any entered are be the as know observations but about the new beamers of the may historical. faster market there And at the think on early, we I they behaviors, class Excel thoughts than way rate purchases, it that that during pandemic, historical same

thoughts high-level any there? Just

Sure.

own the investors a planning. interested insights another year we into headset console help, survey like market, and our and to So, in frankly and inform I we gaming are forecasting our done business know always have once analysts do

The high sense. little that into the high prepared But It's shown is entered. - first has which with this, top interesting it that levels they're revenue-producing think is high the including I the have towards frankly, products common mentioned have we not weighted - a well. as thing wireless the remarks, gamers the products. bit better very we're gaming, I indicates in more seeing And new fact more As entry that modification surprising. say, and is our of that good who - these of half with products, gamers level, briefly there's entry-level products new X at XX of survey these in only United in the the of the level upgrading come opportunities States, these year, being future a creates would

Juergen. Great. Thank you,

Thanks, Tom.

Thanks, Tom.

Jack comes Aarde Maxim The question with in Vander next queue the from Group.

Please proceed. Your line open. is

results, the taking Great. Congrats my on for solid Thanks yet again. questions. guys,

there's core already like the console a year. initial initial I million to business. that hit question outside next following with sounds hit have it revenue you this, going if on that to Jorgen, a that, So but of up - headset or just know chance you're $XXX target your

Or and from Like be does out? the and So achieve first, ex the out My impressive or flight target play to require $XXX that's But new you your congrats, question of is outperformance yet play it Is in that's what say I'd is a thoughts performance product breakout if is here. most the like sure new there's next controller launch multiple announced? to were by needs that product it what year, - do just execution. there? million simulator like I'm factor? or could scenario to product that that think lines? another to are existing businesses scenarios your Xbox you likely sales the What

Sure.

particularly is say, What for how would expectations given higher have roughly flights we to ourselves is PC, need record we the with we come got continue We and for even kind we've and to have, surprised very and of PC in year. could to sell, and for $XXX would to in really categories as controllers penciled find or that breakthrough track could, in I perform a needed million no in So our performance there's tracking of reasonable mics, those and they grow flight than next year. and especially where well be major forecasts. next sim, controllers flights to kind over near

Excellent.

target, a multiyear growth doesn't your come the it kind hitting Okay. I that follow-up, matter plan. from. revenue, non-console That's could of million-plus revenues And revisit where $XXX of helpful. And separately, then revenue target just your if long-term regardless

just stick any update remain target. outlook maybe Do with long-term confident that? you is shaping and that that there for your also is then up? you on How XXXX revenue for initially Just

Sure.

So XX% XX%. our X-year long-term of revenue is revenue of a growth delivered goal Through the we've XXXX, XX%. to end CAGR

So we're sweet the right like spot. in tracking

certainly provide we're way, EBITDA an X Our with for XX% It's that going too And to this years lower to in continue to in XXXX are but on over growth. a to off targeting of higher And So of sweet XX%. CAGR, very years Historically, yet. to is goals. on the still our update XX% XXXX, early, to be go year. and we're spot by all lot be revenue growth but doing that we - continue that, not and again, will well

hear. for helpful good it historical Thanks. context. Yeah. to That's me. That's That's a

Jack. Thanks,

Thanks. Yeah.

from Thank your is you. line proceed. Martin Please And And Yang the question is Oppenheimer. with open.

My is, increase year, the controllers? sales products, with this and be associated around afternoon, Good in question the much us some Juergen. more new how microphone maybe will afternoon, particularly first OpEx the John. Good give maybe can new the and you rocket, on marketing investment details the

Martin. Sure,

business up remarks. be over in the - up. while business the can't lot higher as last XXXX. catch the this primary So And we've you we fact run the is year The the just that will grew a year, OpEx driver is stated XX% rate

You people in place. can't get

You systems to from revenue place in now million. has X $XXX to can't gone $XXX million business in and infrastructure resources to handle tracking in get that and a years

hard our it'd than because and So headset way. in that's Sales this new much don't we rest Operations is core leverages the organizations. the at integrated. be break - business of multiple biggest any dedicated is the break integrated, run fully to the an out out, categories expenses driver. of fully marketing between frankly, very to other integrated specific of everything is engineering, business and point

business, so can't go given of it's of And a normal we part specific our just targeted than and is break operations we growth other out. campaigns, this marketing that it kind investing as really again, core

activities? you or comment sense. makes we And expect or should most product category which - on can in you Yes, maybe the marketing promotional your do growth

got we're I to are a categories, mean, PC which keyboards, well efforts in including is going in would because hard in in which countries business, general, business, that It's category growing putting that's Again, - headsets, - very Asia. X - it global the be key mice, some

the is marketing marketing launch would also spend one - get why lot share. it. normally QX the behind to some new categories, released it the we that We've have would would. That's way about of than So biggest products. we to new that product each needs get really But higher than a the think of had somewhat

consumers given you going. portfolio and be the sales point the of by drive and of provide continue product driven products really get when marketing top So share. everybody to are On number That's to at the a gets releases, fair communicate in that their to in development. to to the the launching investments any going at time, got brand that, our

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Yes. Got it.

sort this to drivers we for one spending you promotional can year severe other is in early think seeing alluded lift? margin your a answers, if of competitors that where shortages, I potential more see So any are potential potential scale of your to a there

Sure.

than there much incremental mid-XXs, the freight margin. with incremental also costs very year and fact come QX projecting costs, will range very which that our for anticipated the will be the everybody around in strong for started target gross spend those, we're The normal. be the as but year we less promotional we've in mid-XXs, can, well so which is So in as XX%, to

came in higher margins. higher QX with and So

and when So target be for when My we've comment past, start related tracking fact our that desired products was - year, was right the short average about you last not the that that of we're an QX band. out, get all in seen example, to supply, what supply the to in less of it to could happen QX, promotional level. there in not on the is everybody to counting on but during incremental that benefit and runs We're able QX. timing depending promotions, who's certainly

one that's higher that margin contributor a we to offset So freight would of add a believe positive - help will what costs. be be incremental

more Should Last XXXX? for you. new into Thank we entries product me. expect question in categories

it quite been consoles you so launch, some very find feel But wait work launch new looking. controllers PC on we the time. the console. wanted doesn't we're I about We good new the Well, controller category until have a at to for looking out do and after

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to the right a don't it be have a that the happen in an we market that consumers the the that. growing use flight get see, rapidly try itself which at opportunity add I if we're are - by products to That additional coming to in retail, more there'll that expand looking opportunity. common or have another mean into doesn't would and all racing in of next need $XXX portfolio that, continue coming is now adjacent do categories, to not look ones two. common to sim, we potential categories we top year other million but But So pressing On as extension. we may we're continue us feel be natural simulation, to

results. Thank all Congrats answers. No. good on for you

Thanks, Martin.

Thank you.

back would session. for Stark to I our question-and-answer the concludes remarks. over call closing this Currently, like to Mr. now any turn

analysts, Thank is the summer and day, enjoying report investors safe in you staying a look months here. very everyone. speaking everyone with and We we again, great November. Thank QX you. Have our much. forward hope our our to We

conclude today's and will gentlemen, Ladies teleconference. this

Thank this disconnect for may time. your you lines your participation. You at