EQS-News: Cherry switch business and Cherry Americas below expectations. 2024 annual results of Cherry SE below plan - focus on growth in 2025

Munich, 11 February 2025 - Subdued trends in the Americas and increasing competitive disadvantages in the switch business are weighing on Group revenue in the fourth quarter of 2024. According to the current state of assessment, Cherry SE's annual revenue for 2024 is therefore below the forecast of around EUR 120 million. The profound structural adjustments at Peripherals and possible political decisions following the German parliamentary elections create positive prospects for 2025. 

According to preliminary and as yet unaudited figures for the 2024 financial year, Group revenue and the adjusted Group EBITDA margin will not reach the previous forecast. Based on current evaluations, Cherry SE now expects consolidated revenue of around EUR 110 million, which is below the forecast of around EUR 120 million. The adjusted Group EBITDA margin is expected to be -2% (forecast: around 3%).

The main reasons for the sales shortfall are the increasing lack of competitiveness in the switch volume business, which is dominated by China, and the insufficient development of the American business. The establishment of an adequate partner network builds the basis for reactivating the US business in the current year.

In the Peripherals division, significant achievements were made in drying out the gray market. Street prices on volume items have already been increased by more than 50%. The sell-in quotas in Q4 were subordinated to the goal of drying up the gray market.

The realignment of the Peripherals business is making progress:

1. sales bundling of all office, gaming, security and hygiene peripherals

2. introduction of a new partner program for DACH

3. new sales partner contracts

4. introduction of a new price and margin model

5. streamlining of product range

6. start of the new SVP Global Peripherals Alexander Hecker on February 01, 2025

The Digital Health & Solutions segment achieved its budgeted target for the year and reported more than 30% year-on-year sales growth.

Cherry SE continues facing challenging geopolitical conditions. Business in the home market of Germany is burdened by rising savings rates, restrained consumer spending, declining direct investments, higher labor and energy costs, excessive bureaucracy and sluggish digitalization. The future government after the federal elections on 23 February 2025, must initiate a direct change of direction in order to lead Germany out of recession and back on the path to becoming a growth and innovation-friendly business location.

For 2025, Cherry SE expects its own internal realignment in conjunction with strict cost management to ensure the company's sustainable and long-term success.

Voices from the management

Oliver Kaltner, CEO of Cherry SE, sums up: “We have launched a comprehensive restructuring program from the second half of 2023. The switch business needs a concept change, Cherry Americas needs consistent sales. Germany is in recession for the third year in a row. It's two minutes to twelve for German SMEs. We are consistently sticking to our realignment with a clear focus on innovation, efficiency, cost reductions, streamlining and strong partnerships. We are confident that we will defy geopolitics in 2025 and finally be back on the path to growth.”

Volker Christ, EVP Global Finance and IT, adds: “In the 2024 financial year, we concentrated on stringent cost and cash management, which we will continue to pursue consistently in 2025. The focus here is on active working capital management.”
 

About Cherry

Cherry SE [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 fields of Gaming & E-Sports, Office & Hybrid Workplaces, Industry, and Healthcare. Since its founding in 1953, Cherry has been known for innovative, high-quality products specifically designed to meet diverse customer needs.

Cherry’s operational headquarters is in Auerbach in der Oberpfalz (Bavaria) and it employs staff in production facilities in Auerbach, Zhuhai (China), and Vienna (Austria), as well as several sales offices in Auerbach (Germany), Munich (Germany), Landskrona (Sweden), Paris (France), Kenosha (USA), Chicago (USA), Hongkong (China), Taipei (China) and Shanghai (China).

For more information, visit:https://ir.cherry.de/en/
 

Contact

Cherry SE

Nicole Schillinger

Investor Relations

P: Rosental 7, c/o Mindspace, 80331 Munich

T: +49 (0) 9643 2061 848

E: ir@cherry.de