Cherry (C3RY) Q4 2024 TU earnings summary

Executive summary

• FY 2024 revenue was EUR 110 million, below the EUR 120 million forecast, with Q4 revenue at EUR 25.8 million, down 32% year-over-year.

• Adjusted EBITDA margin for FY 2024 was -2%, missing the 3% target; Q4 adjusted EBITDA was -EUR 1.5 million.

• Free cash flow in Q4 improved to EUR 7.8 million, supported by strong trade working capital reduction.

• Major organizational restructuring included centralization of product management, sales, and marketing, and a new partner program for 2025.

• Digital Health & Solutions segment delivered over 30% year-on-year sales growth and met targets.

Financial highlights

• Group sales for 2024 were EUR 110 million, with Q4 sales at EUR 25.8 million, down 32% year-on-year.

• Adjusted EBITDA for Q4 was -EUR 1.5 million, and -EUR 2.2 million for the full year.

• Gaming & Office Peripherals revenue for 2024 was EUR 72 million, down from EUR 93 million in 2023, with Q4 revenue down 42.1% year-on-year.

• Digital Health & Solutions revenue grew to over EUR 30 million, up 32.2% year-on-year.

• Operating expenses reduced by nearly 6% year-over-year.

• Trade working capital reduced by EUR 24 million from Q2 2023 peak.

• Cash and cash equivalents fell 64.4% year-over-year to EUR 16.4 million at year-end.

Outlook and guidance

• No quantitative guidance for 2025 yet due to high uncertainty.

• Positive drivers include pricing uplift in peripherals, new partner program, and demand in digital health.

• Strategic measures in the Americas and cost-cutting program of EUR 3.5 million expected to support margin recovery.

• US tariffs on China-made products could impact 2025 margins by up to USD 1 million.