Cherry AG reports results for third quarter and first 9 months 2022

Cherry AG reports results for third quarter and first 9 months 2022


Cherry AG / Key word(s): Interim Report/9 Month figures
Cherry AG reports results for third quarter and first 9 months 2022

15.11.2022 / 08:00 CET/CEST
The issuer is solely responsible for the content of this announcement.

Cherry AG reports results for third quarter and first 9 months 2022

Group revenue of EUR 98.0 million for the first 9 months of 2022, down by 20.6% (9M/2021: EUR 123,4 million)
Adjusted EBITDA margin of 13.9% for the first 9 months of 2022 (9M/2021: 29.6%), down due to shifts in the product mix as well as short-term burdens
PROFESSIONAL business area continues to grow in first 9 months of 2022 by 4.3% to EUR 62.8 million (9M/2021: EUR 60.2 million) based on strong Peripherals business and solid Digital Health business
GAMING business area with EUR 35.1 million revenues for first 9 months of 2022 still burdened by currently unfavorable market conditions, 44.4% decline in revenues (9M/2021: EUR 63.2 million)
Updated revenue forecast for current fiscal year between EUR 130 million and EUR 140 million with adjusted EBITDA margin between 13% and 15% confirmed


Munich, November 15, 2022 – Cherry AG [ISIN: DE000A3CRRN9] today published its unaudited condensed consolidated financial statements for the third quarter and the first 9 months of 2022 and confirmed its preliminary figures and updated forecast for the full year 2022.

"Despite the current unfavorable market conditions, our increasingly strong Peripherals business has ensured further growth in the PROFESSIONAL business area," said Rolf Unterberger, CEO of Cherry AG, commenting on Cherry's business performance in the first 9 months of 2022. "The foundation for this, in addition to our targeted portfolio expansion, is the systematic expansion of our sales footprint, particularly via e-commerce. In contrast, the GAMING business area continued to be impacted by supply chain disruptions, high inventory levels and currently low demand for MX keyboard switches. In the medium and long term, however, we continue to see very good growth prospects with our supplemented and modernized product portfolio, driven by the major trends in gaming, mobile working and the digitization of healthcare."

“With the recent update of the full-year guidance, we take into account the current market environment for our business activities,” adds Bernd Wagner, CFO of Cherry AG. “At the same time, we are taking various measures to improve our operating performance for the future in order to continue our profitable growth course.”

Business performance in the third quarter of the current fiscal year largely reflected the developments observed over the course of the first six months and continued to be hampered by adverse economic and geopolitical conditions. High inflation rates in key sales regions, particularly in Europe and the USA, as well as fears of a global recession triggered by the COVID-19 pandemic and the war in Ukraine led to a high level of economic uncertainty.

Cherry recorded a 20.6% decline in Group revenue to EUR 98.0 million (9M/2021: EUR 123.4 million). The gross margin decreased by 9.3 percentage points to 31.9% of Group revenue, compared to 41.2% one year earlier. The main factors driving the lower margin were product mix effects, lower capacity utilization, and higher material and logistics costs. Moreover, non-recurring items had a negative impact on the gross margin during the period under report.

Research and development costs increased by 29.6% year on year to EUR 6.2 million (9M/2021: EUR 4.8 million), corresponding to an R&D ratio of 6.3% (9M/2021: 3.9%), reflecting higher expenditure on the development of new products for targeted portfolio expansion, mainly in the Digital Health business unit. In conjunction with the continued strategy of achieving organic growth, marketing and selling expenses rose by 23.1% to EUR 13.9 million (9M/2021: EUR 11.3 million), resulting in a selling expense ratio of 14.2% (9M/2021: 9.2%). The increase was mainly driven by start-up and implementation expenses incurred in conjunction with the implementation of a joint e-commerce strategy by the Gaming Devices and Peripherals business units, particularly in the areas of consulting, IT, personnel, and recruitment. In contrast, administrative expenses decreased by 28.9% to EUR 10.4 million in the same period (9M/2021: EUR 14.6 million), giving an administrative expense ratio of 10.6% (9M/2021: 11.9%). The lower percentage was mainly due to costs incurred during the preparation of the IPO and for the introduction of share-based remuneration in the previous year, although additional savings were also achieved through pro-active cost management measures during the period under report.

Taking into account other operating income and expenses of EUR -0.6 million (net expense), the operating profit before interest and taxes (EBIT) for the first three quarters of the current fiscal year amounted to EUR 0.2 million (9M/2021: EUR 20.1 million), which corresponds to a positive EBIT margin of 0.2% (9M/2021: 16.3%).

Adjusted EBITDA amounted to EUR +13.6 million (9M/2021: EUR +36.5 million), the resulting adjusted EBITDA margin declined by 15.7 percentage points to 13.9% year on year (9M/2021: 29.6%). Overall, net expenses of EUR 1.9 million were adjusted.

The PROFESSIONAL business area's share of total revenue increased to 64.1% (9M/2021: 48.8%), while the GAMING business area's share decreased correspondingly to 35.9% (9M/2021: 51.2%).

The PROFESSIONAL business area continued to perform well, despite the current unfavorable economic conditions. Accordingly, revenue increased by 4.3% to EUR 62.8 million year on year (9M/2021: EUR 60.2 million). The expansion of our e-commerce activities via Amazon made it possible to exploit initial market potential in the Peripherals business unit. Revenue generated with office peripherals grew by 4.4% to EUR 43.9 million (9M/2021: EUR 42.0 million). The Digital Health business unit also performed positively, with revenue up by 4.1% to EUR 18.9 million (9M/2021: EUR 18.2 million). Adjusted EBITDA for the PROFESSIONAL business area fell by 22.8% to EUR 9.8 million (9M/2021: EUR 12.7 million). The adjusted EBITDA margin came in at 15.7% compared to 21.1% one year earlier.

In the GAMING business area, revenue generated by the Components business unit fell by 60.8% to EUR 17.7 million (9M/2021: EUR 45.3 million) due to the above-mentioned factors. Demand for the new ULP technology switches exceeded the currently available production capacity. The Gaming Devices business unit, on the other hand, generated revenue of EUR 17.4 million, only slightly below the previous year's figure of EUR 17.8 million (-2.5%), despite the prevailing adverse market conditions. At EUR 3.8 million, adjusted EBITDA for the GAMING business area was 84.1% down on the previous year (9M/2021: EUR 23.8 million). The adjusted EBITDA margin came in at 12.3% compared to 24.8% one year earlier.

Total assets rose slightly by 0.8% to EUR 414.1 million as of September 30, 2022 and were thus at a similar level to December 31, 2021 (EUR 411.0 million). During the same period, current assets increased by EUR 2.4 million or 1.4% to EUR 179.1 million. Equity fell by EUR 1.7 million to EUR 291.4 million during the reporting period. Subscribed capital and capital reserves decreased overall by EUR 5.2 million as a result of the "Share Buyback Program 2022". By September 30, a total of 650,212 treasury shares had already been bought back which are available, among other things, as a potential purchase price component for M&A transactions. Current liabilities went up by EUR 9.1 million to EUR 42.2 million, mainly reflecting temporary fluctuations in delivery dates and payment terms.

Cash flow from operating activities for the nine-month period fell by EUR 2.3 million and finished at a net negative amount of EUR -0.8 million. Cash flow from investing activities was a net negative amount of EUR -9.3 million, similar to one year earlier (EUR -9.9 million).

Cash and cash equivalents decreased by EUR 18.4 million to EUR 91.3 million during the period under report, mainly reflecting the EUR 19.2 million increase in inventories on the one hand and the EUR 5.2 million utilized in connection with the share buyback program through September 30, 2022.

On November 7, 2022, the Management Board updated its original forecast for the current fiscal year with the publication of insider information pursuant to Article 17 of the Market Abuse Regulation (MAR). Accordingly, for the fiscal year 2022, the Management Board expects Group revenue of between approximately EUR 130 million and EUR 140 million (previously: between approximately EUR 150 million and EUR 170 million) with an adjusted EBITDA margin of 13% to 15% (previously: 14% to 19%).

In view of the increasing worldwide slowdown in economic growth and rising inflation driven by the war in Ukraine, the ongoing supply chain disruptions resulting from the lockdowns in China, high inventory levels at customers and distributors, and the accompanying lower demand for certain types of mechanical keyboard switches, the Management Board now expects a strong decrease in revenue for the full year in the GAMING business area (previous forecast: low revenue growth) and revenue growth of between 8% and 10% in the PROFESSIONAL business area (previously: revenue growth in the low double-digit percentage range).

The unaudited interim report for the third quarter and first 9 months of 2022 is available on Cherry's website at



About Cherry

Cherry AG [ISIN: DE000A3CRRN9] is a global manufacturer of high-end switches for mechanical keyboards and computer input devices such as keyboards, mice and headsets for applications in the gaming & e-sports, office & hybrid workplaces, industry and healthcare sectors. Since its founding in 1953, Cherry has been synonymous with innovative, high-quality products designed specifically to meet diverse customer needs.

Cherry has its operational headquarters in Auerbach in the Upper Palatinate (Bavaria) and employs over 500 people in production facilities in Auerbach, Zhuhai (China) and Vienna (Austria) as well as in several sales offices in Auerbach, Pegnitz, Munich, Paris, Kenosha (USA), Taipei and Hong Kong.

More information is available online at:


Dr. Kai Holtmann

Investor Relations

Einsteinstraße 174, c/o Design Offices Bogenhausen, 81677 Munich, Germany

Postal address: Cherrystrasse 2, 91275 Auerbach, Germany

T +49 (0)175-1971503

F +49 (0)9643 20 61-900



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Language: English
Company: Cherry AG
Einsteinstraße 174, Design Offices Bgh
81677 München
Phone: +4996432061100
Listed: Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Hanover, Munich, Stuttgart, Tradegate Exchange
EQS News ID: 1487217

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1487217  15.11.2022 CET/CEST