Turtle Beach Corp Fair Value Disclosure
Note 4. Fair Value Measurement
The Company follows a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. This hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows:
Financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable and the revolving line of credit. As of December 31, 2025 and 2024, the Company has not elected the fair value option for any financial assets and liabilities for which such an election would have been permitted.
The following is a summary of the carrying amounts and estimated fair values of the Company’s financial instruments at December 31, 2025 and 2024 (in thousands):
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December 31, 2025 |
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December 31, 2024 |
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Reported |
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Fair Value |
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Reported |
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Fair Value |
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Financial Assets and Liabilities: |
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Cash and cash equivalents |
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$ |
16,963 |
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$ |
16,963 |
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$ |
12,995 |
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$ |
12,995 |
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Cash equivalents are stated at amortized cost, which approximates fair value as of the consolidated balance sheet dates, due to the short period of time to maturity; and accounts receivable and accounts payable are stated at their carrying value, which approximates fair value due to the short time to the expected receipt or payment. The carrying values of the Revolving Credit Facility and Term Loan due 2028 approximate fair value as their stated interest rates reflect current market rates.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 12, 2026 | Showing above |
| 2024 | Mar 17, 2025 | |
| 2023 | Mar 13, 2024 | |
| 2022 | Mar 29, 2023 | |
| 2021 | Mar 2, 2022 | |
| 2020 | Mar 4, 2021 | |
| 2019 | Mar 13, 2020 | |
| 2018 | Mar 18, 2019 | |
| 2017 | Mar 7, 2018 | |
| 2016 | Mar 8, 2017 | |
| 2015 | Mar 30, 2016 | |
About Fair Value Disclosures
Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.
Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.