In numbers, Asetek reported revenue of $12.2 million, which is significantly lower than $20.5 million in Q3 2023. The reported gross margin is 36 percent, down by a solid 10 percent from the same quarter last year. Net income is also impacted by $18 million of non-cash write-downs and $0.8 million in U.S. tax costs. Asetek's FY 2024 revenue expectations remained at a decrease of 35 to 40 percent compared to last year.

The soft results are in accordance with expectations as Asetek's liquid cooling business is impacted by "changed market dynamics with decreased demand for premium products." Despite a big drop, Asetek's liquid cooling business is expected to remain profitable for this year and beyond, with an expected increase from 2026 and onwards.

This part of Asetek's business has definitely taken a big hit, but it is a pretty much recurring trend, as the company took a similar drop back in Q3 2021 and 2022, after its glory days back in 2020 and most of 2021. The business was doing pretty well from Q1 2023 all the way to Q4 2023, so it is reasonable to expect it will rebound back, especially since it has started to ship a total of 5 new liquid products in Q3 2024, and 13 new products are expected to ship in Q4 2024.

On the other hand, Asetek's SimSports business, which has been around since Q3 2023, is steadily growing and scales-up according to the plan, with solid revenue and some big deals, like the Xbox license agreement that has just been announced, with initial products expected to be available in the second half of next year. The company has finished its Invicta product line, with the steering wheel starting to ship back in October 2024.

Asetek expects its FY 2024 results to remain according to expectations, with a 35 to 40 decrease in revenue. You can check out the full results over at Asetek's Investor Relations page.