Secretlab back in the black after 2 ‘challenging’ years

Secretlab has long been one of the “it” chair brands for gamers.

The Singapore-based firm, which sells a range of gaming chairs, mesh chairs, desks, and accessories, saw a spike in sales during the Covid-19 pandemic. But growth has slowed since, and the firm is now marketing its products as more than just gaming chairs.

Secretlab co-founders Alaric Choo (left) and Ian Ang / Photo credit: Secretlab

The strategy seems to have helped. In its financial year ending February 2024 (FY2024), group revenue for Secretlab – which includes local and overseas subsidiaries – grew 9% to S$370.7 million (US$283.2 million), according to its audited financial statement from Alternatives.pe, which tracks company filings.

A tighter rein on costs put the company’s gross profit at US$90.1 million, a 49% increase over the previous year. This returned the firm to profitability in FY2024, bringing it back from the brink of what the company says was a “challenging” post-pandemic period.

Return to rising revenue

A Secretlab spokesperson tells Tech in Asia that the firm saw “gradual month-on-month improvement” in its financials in FY2024, which has continued into 2024, after experiencing hurdles in 2022 and 2023 that caused “immense pressure for months on end.”

Albeit small, Secretlab’s growth for the year reversed a decline in revenue from the previous year. “We focused on the long game, keeping costs and cash flows under tight control,” the spokesperson adds.

This was evident in its cost of sales, which contracted by 3% in FY2024 to US$193.6 million.

In an interview with Tech in Asia in February last year, Secretlab co-founder and CEO Ian Ang said that 2022 would likely be the firm’s first loss-making year due to rising manufacturing costs and supply chain issues brought about by the pandemic.

This was reflected in the firm’s FY2023 financials, where it logged S$8.7 million (US$6.6 million) in losses.

“Today, we are completely debt-free and are on track to a record year, despite being near the trough of our industry’s business cycle,” the company spokesperson notes.

See also: Mapping Singapore’s leading D2C brands

Clearing out inventory

At a group level, the company’s inventory for FY2024 landed at US$47.7 million, down from US$64.7 million year on year. This is also well below Secretlab’s US$157 million in inventory for FY2022.

As Ang previously explained, this figure peaked in FY2022 because Secretlab shifted to a “just-in-case inventory system,” given the global logistics and supply chain issues at the time.

Cash flow decline