Razer has released its 2021 earnings report.

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Razer has released its 2021 earnings report

In his statement, Razer shared important points about company earnings as well as announced its 2021 financial reports.

Razer has announced its financial reports for 2021 with its statement. “As we deal with the uncertainties and challenges attributable to geopolitical tensions, the macro environment, and the ongoing COVID-19 pandemic, the negative impact that ongoing industry-wide supply chain shocks will have on shipping, logistics and our business,” said Min-Liang Tan, Razer Co-Founder and CEO. We expect it to continue in 2022. On the demand front, we have seen a slowdown in the growth momentum of our products and services since the second half of 2021 compared to the extraordinary growth in the previous year. We expect this downward trend to continue in 2022 due to the high base effect seen in 2021.” interpreted as.

“Looking forward, we will continue to invest in new growth areas and build Razer’s unique gaming ecosystem. But it will take time for these growth areas to fully materialize before they start to see fruit. This will require additional expenditure on our operating expenses and may affect short- to medium-term business performance.”

Razer’s 2021 earnings report

Highlights for FY2021 earnings

COMPANY

  • Due to the pandemic, demand in the first half of 2021 posted revenue of $1,619.6 million, growing 33.3% year-on-year, driven by increased market share for the Hardware segment and continued expansion of channels and content for the Services business.
  • Gross Margin increased from 22.3% to 24.0% year-on-year driven by continued expansion of Hardware margins, partially offset by the spike in shipping rates due to industry-wide supply chain and logistical challenges.
  • Adjusted EBITDA* (a non-GAAP measure) was $96.1 million, up 115.5% from $44.6 million in the prior year.
  • Net Profit due to revenue growth, continued gross margin expansion and productivity growth; was $43.4 million compared to $0.8 million in the prior year.

*Razer defines adjusted EBITDA as profit/(loss) from added operations with impairment and depreciation, share-based compensation expense, restructuring expense, impairment of long-lived assets, and merger and acquisition expenses.

CORE SEGMENTS

EQUIPMENT:

  • Revenue grew 34.0% year over year to $1,452.4 million.
  • Peripherals department; It remained the market leader in gaming peripherals in the US, Europe and Asia-Pacific1 regions and was strengthened by the launch of multiple products in the flagship keyboard and mouse families.
  • The Systems division maintained its position as the market leader in the US premium gaming laptop segment while growing market share in new markets outside the US2.
  • It has gone further to expand its growth categories, particularly gaming chairs, console and publisher products.

SOFTWARE:

  • Total user accounts grew 44.1% year-on-year to approximately 177.7 million, and monthly active users increased by over 30.0%.
  • This increase; Supported by increases in gaming, award-winning events and live streaming events, the products offered by the Software department to users can be attributed to strong growth.

SERVICES:

  • The Services division, comprised of Razer Gold and Razer Fintech, grew 26.6% year-on-year to reach $162.5 million for the full year 2021.
  • Gross margin of 38.5% contributed to 16.1% of the Group’s gross profit.

ESG (SUSTAINABILITY PROJECT)

  • He made sustainability the key to gaming, and reinforced that commitment by introducing a ten-year sustainability plan to protect and care for the environment through #GoGreenWithRazer in 2021.
  • The group has made significant progress in achieving its ESG goals, including:
    • Upgraded its upcoming sustainability report to GRI Core standards, one of the world’s leading sustainability reporting standards;
    • Provided transparency through the disclosure of environmental data by making its first disclosure within the scope of the Carbon Disclosure Project (“CDP”);
    • to the Science-Based Goals Initiative; Participated with a commitment to set decarbonisation targets by adhering to a climate scenario below 1.5°C by 2030 and achieving net carbon neutrality; and
    • It has incorporated climate-related risks into Razer’s enterprise risk management process by proactively recognizing and mitigating the potential impact of climate-related risks.
  • As part of the group’s effort to mobilize the community to contribute to and support sustainability initiatives, the Group partnered with Conservation International in October 2020 and launched the Sneki Snek campaign. Group as of January 2022 More than 900,000 trees saved.

APPEARANCE

MACRO CHALLENGES AND UNCERTAINTY:

  • Industry-wide supply chain challenges will continue to impact the industry.
  • Freight and logistics are expected to remain a challenge throughout the year.
  • Due to the high base effect, the slowdown in the growth momentum from the second half of 2021 is expected to continue until 2022.

NEW AREAS OF GROWTH:

  • Expanding hardware products to include furniture and other gamer lifestyle categories.
  • Razer Gold’s regional expansion continues.
  • Scaling and geographic expansion of TPV for Razer Fintech.

IMPACT ON BUSINESS PERFORMANCE:

  • Additional expenses in operating expenses.
  • New growth areas will require significant investments.
  • It will take time for new growth areas to prove their contribution to the Company.

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