Shares of Turtle Beach (HEAR -1.80%) popped by as much as 13% this morning after the company reported preliminary fourth-quarter results that are ahead of analyst expectations. As of 2:50 p.m. EST, the stock had pulled back and was up just 2%.
Revenue in the fourth quarter should be in the range of $130 million to $132 million, compared to the $104.9 million in sales Wall Street is expecting. Adjusted earnings per share in the fourth quarter are estimated to be in the range of $0.73 to $0.82, which is significantly above the consensus estimate of $0.47 per share in adjusted profits. The consumer discretionary company, which specializes in making gaming headsets, said adjusted EBITDA in the fourth quarter jumped to a range of $21 million to $23 million.
"Driven by our exceptionally strong operational execution in a robust market for gaming accessories, our sales and adjusted EBITDA reached record levels in 2020," CEO Juergen Stark said in a statement. "We worked very closely with our retail partners and were able to quickly adjust supply to address the rapid market growth which allowed us to significantly outpace the rest of the market."
Turtle Beach finished the quarter with approximately $46 million in cash and no debt. Sales of ROCCAT PC accessories doubled, Stark added, and the company continues to expand into new product categories. The gaming market continues to grow, and Turtle Beach is optimistic that the new generation of consoles will support that momentum.
Turtle Beach will report full financial results in mid-March.