Key Takeaways

New GPU releases and Fanatec acquisition fuel growth in core and premium markets, driving higher margins and supporting broader addressable opportunities.
Emphasis on AI-driven creator tools, efficient supply chain, and direct sales channels boosts market share, cost control, and future earnings.
Corsair faces profitability challenges and long-term growth risks due to heavy reliance on PC upgrade cycles, rising costs, shifting gaming trends, and intensifying industry competition.

Catalysts

About Corsair Gaming

Designs and sells gaming and streaming peripherals, components, and systems in Europe, the Middle East, North Africa, North America, Latin America, and the Asia Pacific.What are the underlying business or industry changes driving this perspective?

The ongoing upgrade cycle driven by new high-performance GPUs (particularly NVIDIA’s 50 Series) is spurring renewed demand for PC builds, which directly increases sales of Corsair’s components, power supplies, and cooling devices—likely boosting both revenue and gross margins in the near to medium term as adoption accelerates.
Expansion into enthusiast and niche categories through the Fanatec acquisition is strengthening Corsair’s position in the premium peripherals and sim racing market, broadening its addressable market and supporting higher average selling prices and improved gross margins—factors likely to drive earnings growth.
The integration of AI-enhanced tools into Elgato’s product suite and support systems positions Corsair to capitalize on the rising demand for creator-focused and intelligent peripherals, enabling the company to tap into the expanding digital content creation market, thus contributing to future revenue and margin expansion.
The company’s flexible, geographically diversified manufacturing and supply chain reduces tariff exposure and operational disruptions, supporting stable net margins and positioning Corsair to capture market share from less-adaptable competitors if global trade uncertainties persist.
Increased adoption of direct-to-consumer channels and operational scale—demonstrated by improved SG&A efficiency and successful margin expansion initiatives—enhances brand loyalty while structurally reducing costs, leading to stronger net margins and higher operating leverage as sales grow.

Corsair Gaming Earnings and Revenue Growth

Corsair Gaming Future Earnings and Revenue Growth

Assumptions

How have these above catalysts been quantified?

Analysts are assuming Corsair Gaming's revenue will grow by 10.3% annually over the next 3 years.
Analysts assume that profit margins will increase from -7.2% today to 4.0% in 3 years time.
Analysts expect earnings to reach $71.6 million (and earnings per share of $0.41) by about June 2028, up from $-96.7 million today.
In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 21.1x on those 2028 earnings, up from -10.6x today. This future PE is greater than the current PE for the US Tech industry at 17.7x.
Analysts expect the number of shares outstanding to grow by 1.61% per year for the next 3 years.
To value all of this in today's terms, we will use a discount rate of 8.39%, as per the Simply Wall St company report.

Corsair Gaming Future Earnings Per Share Growth

Risks

What could happen that would invalidate this narrative?

Corsair is highly reliant on the ongoing PC hardware upgrade cycle—especially new GPU and CPU launches; any slowdown in consumer interest, delayed product launches by partners like NVIDIA, or a long refresh cycle could materially reduce demand for Corsair’s products, directly impacting revenue and earnings growth.
The company’s confidence is notably cautious regarding tariffs, as significant increases or unexpected trade retaliation—especially on semiconductors or key components—could elevate input costs or dampen consumer demand for PC building, compressing net margins and potentially reducing sales volumes.
Despite improvements, Corsair continues to report net losses on a GAAP basis, which suggests underlying structural challenges in achieving consistent profitability, and exposes the company to risk during periods of weaker demand or increased operating expenses.
Corsair’s growth is still heavily dependent on the enthusiast and DIY PC builder market, which faces long-term risks from the secular shift towards mobile, cloud, and subscription-based/hardware-agnostic gaming, potentially limiting Corsair’s total addressable market and pressuring long-term revenue expansion.
Intensifying competition in both the peripherals and components markets, coupled with the commoditization of gaming hardware, could erode Corsair’s pricing power and gross margins, limiting the company’s ability to sustain earnings growth over the long term.

Valuation

How have all the factors above been brought together to estimate a fair value?

The analysts have a consensus price target of $10.667 for Corsair Gaming based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $13.0, and the most bearish reporting a price target of just $8.0.
In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $1.8 billion, earnings will come to $71.6 million, and it would be trading on a PE ratio of 21.1x, assuming you use a discount rate of 8.4%.
Given the current share price of $9.7, the analyst price target of $10.67 is 9.1% higher. The relatively low difference between the current share price and the analyst consensus price target indicates that they believe on average, the company is fairly priced.
We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.