Cherry SE publishes results for the first quarter of 2026 – Operating profitability significantly improved

Munich, 7 May 2026 – Cherry SE today published its report for the first quarter of 2026. Despite a decline in Group revenue to EUR 20.8 million (Q1 2025: EUR 25.3 million), operational profitability improved significantly. The adjusted Group EBITDA margin rose to -2.9% from -8.0% in the prior-year period, driven primarily by a reduced cost base and an improved gross margin in the Digital Health & Solutions (DH&S) and Components segments. To accelerate this trend, the Management Board has launched the comprehensive transformation program “Project Blossom”, aimed at right-sizing the organizational structure and implementing new growth initiatives to support a return to operating profitability from 2027 onwards.

The first quarter of 2026 was characterized by rigorous cost discipline with the aim of improving operating results, particularly in the Peripherals segment. While the European market remained challenging due to high inventory levels in distribution channels and subdued demand, the cost reduction measures initiated have shown clear results. Marketing and sales costs, for example, were reduced significantly by approximately 40%. A key milestone was also the stabilization of liquidity: operating cash flow turned clearly positive at EUR 1.3 million, compared to an outflow of EUR 8.0 million in the prior-year period.

Digital Health & Solutions:

The DH&S segment recorded a strong increase in revenue to EUR 5.2 million (Q1 2025: EUR 2.7 million), driven by the ongoing connection of care facilities to the telematics infrastructure (TI) as well as additional demand from the replacement of legacy e-health terminals. On a comparable basis, adjusted for the effect of the divestiture of the hygiene keyboard division in the prior year, revenue more than tripled. The segment’s adjusted EBITDA margin improved significantly to 33.5% (Q1 2025: -43.7%).

The M&A process initiated in November has since focused on the DH&S segment and is progressing as planned. The objective of the divestiture is to consistently reinvest the proceeds into the growth of the core business in Peripherals and Components and strengthen the balance sheet.

Gaming & Office Peripherals:

In the Gaming & Office Peripherals segment, revenue of EUR 14.8 million came in below the prior-year figure of EUR 21.2 million; however, the gross margin was maintained at close to 39%. Due to a one-off U.S. inventory purchase by certain affiliates of Argand Partners in 2025 as well as currency effects in the US dollar and renminbi, the revenue decline amounted to approximately 17%, or EUR 3.0 million in absolute terms, compared to the adjusted prior-year figure of EUR 17.8 million.

This decline is primarily attributable to continued subdued demand in the gaming environment as well as structural adjustments in the course of the strategic realignment. In the office business, elevated inventory levels in distribution channels — particularly among German distributors — additionally dampened near-term sales potential. Cherry deliberately refrained from heavily discounted sales measures in order to protect margin quality and ensure a sustainable stabilization of market prices. At the same time, the segment already benefited noticeably from a significantly reduced sales cost base as part of the strategic realignment.

Components:

The Components segment continued to face a challenging market environment in the first quarter of 2026, with a volume-driven decline in revenue. At the same time, measures to optimize the product mix had a positive impact on profitability. The gross margin improved significantly to 72.6%, up from 47.5% in the prior-year quarter. Adjusted EBITDA improved accordingly to EUR -0.3 million from EUR -0.6 million in the prior year.

Transformation Project Blossom:

With “Project Blossom”, Cherry presents its stakeholders today with a two-stage strategic realignment designed to sustainably return the future Peripherals-focused company to a path of value creation, growth, and positive operating results. The first stage focuses on building new growth opportunities through four key initiatives: strengthening the Office & B2B business in the DACH region, expanding e-commerce and digital channels in Western Europe and the United States, accelerating regional growth in China and the United States, and intensifying the focus on the Security & Industry segment in Western Europe, beginning in Germany. In parallel, the second stage encompasses a fundamental redesign of the cost structure, targeting a further reduction of non-product-related annualized fixed costs of approximately EUR 8 million. Through this structural adjustment of the organization, the target operating model aims to reach break-even at EBIT level at an annual revenue of EUR 85 million and a gross margin of 44%.

Rogier Volmer, CEO of Cherry SE: “With Project Blossom, the company has established a clear plan to translate the encouraging signals of the first quarter into sustainable value creation. The focus is no longer solely on stopping the decline, but on rebuilding the foundation for future profitable growth through increased efficiency and targeted investment in core markets such as the United States, APAC, and the DACH region.

About Cherry

Cherry SE [ISIN: DE000A3CRRN9] is a global manufacturer of computer input devices such as keyboards, mice, microphones, and headsets for applications in office, gaming, and industry for hybrid work, as well as hardware and software solutions in digital healthcare. Since its founding in 1953, CHERRY has been synonymous with innovative and durable high-quality products, developed in-house, specifically to meet customer needs.

CHERRY’s operational headquarters is in Germany (Auerbach in der Oberpfalz) and it employs staff in development, services, logistics, and production sites in Germany (Auerbach), China (Zhuhai), and Austria (Vienna), as well as in multiple sales offices in Germany (Munich, Auerbach), France (Paris), Sweden (Landskrona), the USA (Kenosha), China (Shanghai) and Taiwan (Taipei).

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