Cherry losses are increasing. From January 2025 to the end of September, the company made a net loss of about 20.4 million euros with a turnover of 70.7 million euros. Cherry now has more debt than equity (equity deficit), leading to an extraordinary general meeting recently.
made in China
Chief Operating Officer (COO) Udo Streller announced there that switch production in Auerbach has now been completely shut down. Instead, Cherry has outsourced production to “established partners in China and Slovakia”.
The patent for the Cherry MX design finally expired in 2014. Since then, more and more Chinese companies are producing switches that are of comparable quality to Cherry. Options include JWK, Gateron, SP Star, Kailah, KTT, Outemu and Taxi. Chinese switches were among the first to be lubricated with factory grease or oil. They are also experimenting with materials. Cherry lags behind its Far Eastern competitors in the so-called Hall effect switches with magnetic fields.
There are now countless Switch variants. Providers such as Razer and Logitech also have self-marketed variants produced by Chinese manufacturers such as Kailash.
Auerbach will from now on act as a “cost-effective development, logistics and service center” for Cherry. Contracts with external logistics partners expire at the end of the year.
(Image: Mark Mantel/Heise Median)
partial sale
Restructuring, loans and capital investments from investors are not enough to keep Cherry afloat. So the manufacturer wants to sell the Peripherals division or the Digital Health and Solutions division to use the proceeds to boost the remaining division.
The Peripherals business includes all keyboards and mice, including gaming and office models. Switches are separate from this and are part of the component division. Digital Health & Solutions includes telematics-compliant applications such as card readers, PIN pads, and TI Messenger.
CFO Jürgen Jongma said at the general meeting: “Due to the group’s low market capitalization and Cherry’s current share price of less than one euro, it is currently neither possible nor appropriate to strengthen the group’s equity in any way other than through strategic mergers and acquisitions options.”
Cherry has already sold the hygiene peripheral equipment division “Active Key” for €12.5 million and an option for an additional €8.5 million upon achievement of financial targets. For example, Active Keys includes washable keyboards.
decline in sales
According to its statements, Cherry benefited from higher demand during the coronavirus pandemic, which has since leveled off. Chery’s turnover in 2021 was still 168.5 million euros. Annual sales of gaming products are set to halve to 41.2 million euros in 2022. In 2023, it improved, but the digital health and solutions division fell 30 percent to 23 million euros. Parts turnover halved to 10.9 million euros.
In 2025 (by the end of September), Gaming and Office Peripherals have so far generated sales of 50.3 million euros, Digital Health and Solutions 16.5 million and Components 3.9 million euros. In healthcare, Cherry is facing a change: about 90,000 medical supply providers, such as physiotherapists, will only be connected to the telematics infrastructure on October 1, 2027, instead of January 1, 2026.
(mma)
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This article was originally published in German. It was translated with technical assistance and editorially reviewed before publication.
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