Good morning, everyone. Today we have the pleasure to host Cris Keirn at our annual consumer conference. In the next 30 minutes or so, we'll go through key topics for the company, as well as the gaming accessory industry. Thank you for everyone for participating in today's annual fireside chat with the CEO of Turtle Beach, Cris Keirn. Thank you for coming here, Cris. Thank you, Martin, and appreciate the time today. Great. I would like to start with a couple of questions regarding the product and gaming cycle we're in. Everyone knows we're heading into a few very exciting hardware and game launches in the next 12 months. First on hardware, particularly Nintendo Switch 2, how should we think about the timing of the new console release and impact on your licensed accessory sales? Is it immediate, or is there a period between the console sales scaling up and your accessory sales picking up? Sure. We're really excited about the upcoming gaming cycle. Really, Switch 2 is a big part of that. There's many things to really look forward to here over the next couple of years, really, for gaming. To your question about Switch 2 and the timing of accessories, typically, and we see this historically, when a new console launches, new piece of hardware, first-party accessories do quite well at the beginning of those cycles. We expect that to occur this time as well. Over time, third-party accessory manufacturers like ourselves and others build up our portfolio. We really look for complementary products to what first-party is doing. We see that grow over time. Certainly, we expect this to be very much like the last cycle, where it is a multi-year benefit for third-party manufacturers and some really, really exciting content coming out from Nintendo when you look at what they are doing with Switch 2. We are super excited about what that looks like going forward. There are, as you mentioned, some other catalysts for the gaming space over the next couple of years. Everyone is extremely excited for GTA VI, which is now going to be in May next year. That is one of those games that drives a massive amount of engagement with gamers. That is always a benefit for folks like us. Looking forward beyond that, we do expect over the next several years to see a new console cycle from some of the other platforms with Sony and Microsoft. Lots of great things coming up for us to look forward to. Got it. You talked a little bit about first-party accessory sales doing well initially, and then your accessories, third-party, doing on a multi-year ramping up on a multi-year basis. Can you maybe double-click on the categories of accessories, maybe address Nintendo and then maybe other platforms individually? What are the type of accessories that historically have a bigger presence from the first party? How do you differentiate, and where do you find the most growth for the third-party accessories? Sure. All the first parties, they do a great job as well with their accessory programs and portfolios. When we collaborate with them on what types of products to bring out and the timing of those to bring out, we're always looking for something that can add excitement and add a new experience for gamers that maybe others aren't addressing and find things that are very complementary. We really value the inputs from our first-party partners on those. We would expect to see, just like any other console cycle, new products be rolling out throughout the life cycle of the console. For Nintendo Switch 2, in particular, we are excited about the audio features that they've brought in and with some of the great online playing capacity that Switch 2 has versus the prior generation. That's one area that we're very excited about. Nintendo's got such great content. You look at some of the new titles they have coming out, and I'm sure they've got more planned in the future. It's going to give us opportunities to work with them and find ways to bring those smiles to gamers with some really great accessories. Same with the other platforms. We always look for opportunities to create products that are differentiated. We're always driving as much innovation as possible into really every price point that we offer. That's one of the things that sets Turtle Beach apart, we believe, is that no matter what price point you're buying, we want to offer the gamer the absolute best experience that they can get, new technology, new developments, really looking at the way that they game and designing products that are going to enhance their experience. That really applies across all platforms, including PC. It's really at the core of the innovations that the team here is driving. Got it. Also referencing your earlier comment regarding GTA VI and that as a potential catalyst for hardware or accessory growth, overall, when you look at gaming software, is there any type of game or key characteristic of games that could give you a bigger uplift in sales? How do we identify those games that are particularly beneficial to Turtle Beach? Sure. First and foremost, we're looking for games that are driving engagement. Gamer engagement is one of the key factors that drives accessories purchases, that along with new technology and new experiences that we can bring to those accessories. When you're looking at genres, there's so many genres that can drive gaming purchases. In particular, those high-engagement games, so GTA VI is a perfect example of that. GTA V, 12 years after its release, is still a massive game for players out there, tons of engagement, tons of hours of play. That drives accessories purchases because the more someone's playing, if they're logging multiple hours a day gaming, they're looking for the best experience they can have with their controller, with their headset, with any of their accessories, really. Anything driving engagement is really the first thing that we look for anticipating what the demand will look like coming up. In particular, from a genre perspective, first-person shooters also do quite well historically driving because of the features that are in those types of games and the audio cues that you can get from different aspects of the game to give you an advantage. Those are the types of games that really drive, whether it's a headset purchase or a controller purchase or a specialty controller purchase. We're very pleased to see what Fortnite's been able to do with Fortnite Festival. As an example of a genre that was kind of there before with Walkman and all those types of games, it has really resurged here with what Epic's been able to do with Fortnite. We're seeing some really good results for our Riffmaster guitar, as an example, with Fortnite Festival. Again, that's driving engagement. It's driving gamers to really look at their accessories and look how they can upgrade and have a better experience. Got it. Speaking of engagement, there are newer gaming platforms such as Roblox oriented to a younger audience, but engagement's typically very, very high. Are you thinking of developing more special products for those, or do you already have a product in your portfolio to address those newer platforms? Sure. You look at the engagement on those types of free-to-play, very large kind of open-world games. We have seen increases, particularly for those big titles in the last few years, particularly since the pandemic. A couple of examples of what we've been driving in that space, we've got licensed Minecraft controllers as an example that has done very, very well. People are looking for that unique sort of even collectible aspect of their accessory for a game that they love. We are always working with partners to try to find those opportunities and really cycle those through. It is always something new, something fresh, always driving new demand. Got it. Speaking of marketing and promotions, how do you plan your marketing activity and promotions specific to either hardware or game releases? Can you overall talk about your general approach? Sure. Yeah, each opportunity there is something that we look to see how can we maximize all the great things that are going on around the gaming industry. That's the great part about this space is there's always something out there that people are looking forward to, right? That people are, whether it's a hardware launch or it's a new accessory launch or it's a new title that's coming out, or in the case of something like Fortnite, a whole new genre that can drive those really large spikes that we've seen historically in gaming demand. The key for us, and what we're always looking ahead, is to try to find the best ways to reach those gamers. There's certainly a lot that we're doing on social media. There's a lot that we're working with our influencers. We've got a great set of influencers out there. Really looking for people that are playing and addressing and creating content for any new title that's coming out. We look at that cadence. There are certain that are sort of evergreen titles that we always are looking to engage with. We also look to try to time it with these nice spikes in demand throughout the year. Got it. I want to maybe touch on overall life cycles of your hardware, maybe a further breakdown into headsets and gaming controllers. Do you see any visible patterns of hardware renewal or upgrade in the past few years? Can you maybe comment on where we are in those cycles? This is a really, really interesting topic. I'm glad you asked about this, Martin, because we're seeing something a little different right now than we've seen historically on the replacement cycle for accessories. Typically, historically, it's been pretty consistent on about a two, pushing sometimes a 2.5, three-year replacement cycle for accessories. What drives that is a couple of things. First is the gamer engagement that we talked about, as there's new games coming out, if there's a big surge in engagement, people go out and they buy new accessories. The other piece is the replacement cycle for accessories themselves, either just through wear or through new tech that's coming out that people are like, "Hey, they want the best battery life they can get." There has been a lot of improvements in technology that have really allowed us to massively increase the battery life that we offer on our products over the last several years. That drives people to go out and replace. What we saw is during the pandemic, this is 2020, 2021, massive demand for gaming accessories and a lot of engagement on gaming. We have not really seen a full replacement cycle on those purchases. That is something that I think as you look at the next couple of years and what is going to be coming up in gaming, that is a big opportunity for everybody in the space, us included, to be able to really capitalize on the replacement for those because we are past that two- to three-year window right now. When you look back at 2024, we did start to see some of those replacements come in. We had a year where accessories were up, kind of low- to mid-single digits, but the overall gaming category was a little down last year. We saw that accessory start to pop. We ran into a bit of a hurdle here in Q1 with everything that is going on from a macro perspective that is having an impact on the gaming accessory space, as we talked about in our earnings call. We've seen sort of a pause in that surge that started on the replacement cycle. There is an opportunity here really starting now with the launch of new hardware and getting into some of these great games where you're going to see that engagement come back up and you're going to see the replacement cycle on top of that engagement. We are really excited about what that's going to mean for the industry and what that's going to mean for Turtle Beach with some great new products that we've got in the market and some new products coming up. Got it. So overall, the framing for the next 12- 18 months is that you have more new hardware platform with hardware renewals plus more exciting games coming up, and then you have the pent-up demand for accessory renewal. Yeah, all those factors combined is why we're really excited about what's ahead and feeling that there's opportunities there for us on the upside if we start to see some of these start to kick in individually. When you get the combined effect of what you just mentioned there, it could really lead to a nice lift. We do expect to see that lift in 2026. With those combined factors, we expect a very strong year for gaming and for accessories. Got it. Sounds good. Next, a couple of questions. I wanted to touch on the topic of M&A and capital allocation, and especially all M&A. We saw really good positive results from your acquisition of PDP. Can you remind us of the source of deal synergy and where did you see the upside surprises coming from? I know you reported a stronger-than-expected synergy from the PDP acquisition. Totally. The PDP acquisition has been such a positive and transformational change for the company. I really give the credit to the team for the massive amount of execution and the excellent work that they've done to really maximize the impact of that acquisition. We acquired PDP in March of last year. We believed when we did the acquisition that there was a couple of really key aspects we really liked about this acquisition. Number one is that it does give us some scale. That's one of the things historically that Turtle Beach has struggled with is that we are a smaller player in the space, even though we have a leading market position. It's something where if we can add scale and bring those customers along that journey with us, it can be extremely accretive for the company. The broadening of our categories by bringing PDP and their strength in controllers and specialty controllers and some of those other categories where Turtle Beach does not have as much of a presence has really enabled us to broaden our product portfolio first and foremost and give us a much more balanced contribution to our overall revenue. I have been with Turtle Beach now for 12 years. When I first joined, it was 95%+ headsets. It was almost completely headsets. Over the last several years, and particularly with PDP, we are now trending more towards like a 60/40 split between headsets at roughly 60% contribution to our revenue and all other categories trending towards 40%. That is largely due to the PDP acquisition. It has really given us a nice broad base to build from and additional scale. With that scale, and you mentioned the synergies there, we've really been able to drive some really good leverage on our operating costs. We anticipated we would get around $10 million-$12 million of synergies from that deal. We're trending right now at $13 million+. We've gotten some great benefits from the tariff perspective as well. As we look at our strategy for tariffs, having those additional manufacturing options for us with the PDP deal has also helped to enable some of the great work that the teams have been able to do around our manufacturing strategy, realizing cost improvements and driving our tariff strategy. We've got all these benefits from the combined company and particularly the expertise that came along with PDP. are a lot of longtime gamers, really, really skilled folks that came over with the acquisition that have really helped to bolster our team. As I look ahead to what we are going to be offering in the future from a product perspective and some of the technology that we are able to offer, I am really, really pleased with how that acquisition has gone and what it means for the future of the company. Got it. So it seems like PDP has set a very high bar for you on potential deals you will look for or get out of. How does overall inform you or update your view on future M&A activities? I think it's a great example of what's possible. It's something where there has been some consolidation going on in the industry, and I believe that will continue. I think that there's opportunities for us to take all the learnings that we have from PDP and other acquisitions that we've done and really apply those to any future deals that we would consider. When you look at our capital allocation strategy, there's multiple pillars. Obviously, we're going to continue to invest in our core business to drive the share gains that we've been able to see and to drive this support over the next couple of years for this great industry that's out there. Another one is M&A. We'll continue to assess and consider additional M&A to drive growth. That was a lot of the demonstration of that success was seen in Q1, where we were up 14% year- over- year on revenue because of the benefit of having PDP in our Q1 for the full quarter versus a couple of weeks last year. Those types of contributions, if we can continue to do meaningful and accretive M&A, that's one opportunity for the company to continue to grow. The third use of capital would be with our share buyback program. We were very aggressive with our buybacks last year. We bought back nearly $30 million worth of our own stock over the last year. It is something that we just also approved a new buyback program for $75 million, up to $75 million of stock over the next two years. When you look at our multiples and you look at what we're anticipating and where we're trading relative to some of our peers, we feel that the company is a strong value and will continue to be opportunistic in our capital allocation approach between those sort of three pillars of our investing in the company, looking at M&A, and then also potentially share buybacks. Got it. Relating to that topic of continuing to protect the value of the company through optimistic buyback, how do investors get comfortable with your level of cash flow generation? Where do you think is the sustainable level of profit and cash flow? Yeah, when you look at our EBITDA for this year, our revised guidance, we've guided to about $15 million of EBITDA. We've got very low capital requirements for the business. That's historically true, and we believe will continue to be true moving forward. We've also got a lot of NOLs that we can utilize for taxes this year as an example. Our cash flow on that $50 million, we anticipate to be in the mid-30s, which is very, very strong. Moving forward, as those NOLs expire next year, we'll be paying more taxes, or we anticipate that we will be. The capital requirements for the business will remain very low. As we get better leverage on our fixed costs, we do anticipate that we'll see strong EBITDA margins and strong cash flow moving forward in 2026 and beyond. Part of that adjustment, based on where the markets are heading, and we do anticipate the markets will continue to improve throughout the year. Based on where Q1 was, we did adjust our guidance down from $70 million of EBITDA to $50 million of EBITDA to account for that in 2025. We anticipate, obviously, we have not guided for 2026 yet, but we do anticipate that the fixed cost leverage that you saw in our original guidance, we would be getting those same benefits as we add revenue and as we add EBITDA in the future. You referenced this year's guidance for EBITDA and then mid-30s for cash flow. Do you think the relationship between the two, when we talk about is EBITDA flow through to cash flow, to stay at a similar, I think that implies like 60-70% flow through, do you think that relationship will hold in the future? Yeah, I think the only thing that will degrade that slightly will be taxes potentially as those NOLs expire. That impact would come in on top. Otherwise, from a structure of the business and from the leverage that we're able to get on our costs, this is something that we are extremely focused on. I think, again, I'm very proud of how the team has executed on this. We've got three pillars to our internal strategy. It's innovation, execution, and it's growth. You have to have all three, really. When we're looking at driving and driving the success of the business, the execution piece is something that, again, when we're looking at M&A, when we're looking at buybacks, when we're looking at investments, we need to make sure that it's accretive and it's profitable. The team has done a great job in maintaining that focus. That is a focus that we'll continue to maintain moving forward. If we double-click on the tax, when should we expect the tax to, how will tax increase over the years? Is there a meaningful step up that we should expect in the, let's say, in the near term or medium term? Yeah, I think we'll have a better idea of that as this year kind of goes on and we see how things develop. We do anticipate that we'll have NOLs that we can use really through at least the end of this year. It's really in 2026 where that would begin to impact. I think we'll have more information on that coming as we see how this year kind of plays out. Got it. I also want to touch on the revenue seasonality a little bit. We discussed console cycles and very big games launching in coming years, especially around May where GTA VI is scheduled to release. Assuming no further delays, how will those events affect your seasonality and maybe give you different patterns comparing to historical average? This year in 2025, we think it's going to be fairly close to historical averages. Aside from Switch 2, which is going to drive a nice bump and a nice lift for the whole industry, we think seasonally accessories will be roughly in a fairly normal year, let's say, for 2025. I do believe in 2026, you're going to see a bit of a change with GTA VI. That's going to drive lift probably similar to what you would see even on a console launch kind of for the entire accessories categories. It's going to be very interesting to see how GTA VI rolls out. It's going to be one of the biggest games ever. That can have a very large impact on accessory purchases. We are trying to prepare for that. I think the seasonality in 2026 will look different because of that launch and because you also have a full year then of Switch 2 in the market and all the things that that will be driving for accessories. We are keeping a close eye on it. I think for 2025, I think it is fair to, we have given a little bit of color on how Q2 is going to look. Q2 will be a bit softer. We expect to see some improvements in Q3 and Q4. One of the last questions I have for you is that if you take a longer term, let's call it a three to five year view of your business, what should investors focus on, also long-term investors focus on and track over time? First and foremost, we're focused on delivering consistent results. That's something that we've had ups and downs at Turtle Beach in the past, particularly when we were more single-threaded in one category. Now we really have built a presence across four major platforms, not only for headsets, but also controllers and specialty controllers, PC products, and simulation products. That's given us a much better balance. The key piece on that is consistent execution and making sure that we're adapting and changing the business as we need to, as quickly as we need to adjust for changes in the markets and changes in the environment. A great example of that is this year. When you look at how we started the year and then the tariffs kicked in and all the impact and the fallout of that across the industry, we prepared for that very well. We adjusted very quickly. We were pleased to be able to announce in our earnings call that starting after Q1, less than 10% of our purchases for the U.S. are going to come from China. We have been able to very quickly adapt. That is one of the advantages of our size versus against some of the competitors is we are very agile and we can adapt quite quickly in those situations. That is the key thing I would say is to look for is performance. We're very focused on making sure that we can make those changes, that they're going to provide a benefit to shareholders and to our customers, and that we're going to execute on those extremely well. As a longer term, when you look at the strategic part of our business, it comes back to those three pillars that we talked about, which is making sure that we're investing properly in the core business, making sure that we're evaluating viable opportunities for M&A, and we'll be very selective with that. PDP was a great example. It needs to be accretive. It needs to be accretive right away. It needs to be something that we have a clear vision on how we're going to integrate and realize those synergies. Thirdly is share buybacks. Because again, as we look at the value of the company, we'll continue to be opportunistic on executing on that buyback program. If you look over the next three to five years, the key for us is maintain that leadership position, drive growth, and reinvest. That's where our focus will remain. Sounds good. With that, we see no further questions from the audience. Again, Cris, thank you so much for today, for your time and insight on business. Appreciate your taking part in our consumer conference. Thank you, Martin. Appreciate it very much. Thank you, everyone. That's a wrap.