Cherry’s rebuild is cutting losses. The recovery is still unfinished.
Project Blossom is reshaping costs, sales channels and funding. October’s update shows progress on losses, while falling revenue and an unfinished audit leave important tests ahead.
Announcement date: October 19, 2026
Cherry’s October update offers a useful test of its restructuring: can the company make a smaller business work better? Its preliminary nine-month loss narrowed again, even as revenue fell.
The context is Project Blossom, launched in May to rebuild the cost base and develop new sources of growth. For keyboard enthusiasts following the company behind Cherry switches and peripherals, the question is how that rebuilding is progressing.
What Project Blossom is changing
The May plan targets roughly €8 million of further annualized fixed-cost reductions outside product costs. Alongside that, Cherry is pursuing Office and B2B customers in Germany, Austria and Switzerland; digital sales in Western Europe and the US; growth in China and the US; and Security and Industry customers, initially in Germany.
Management’s model aims for EBIT break-even at around €85 million in annual revenue and a 44% gross margin, with a return to operating profitability from 2027. These are targets. They are not evidence that the company has already reached break-even.
Sales investment alongside the cuts
One concrete step came on August 3, when Cherry announced five appointments covering the German-speaking B2B channel, France, the UK and Benelux. The expanded team is intended to work more closely with system integrators, distributors and retailers.
That gives the turnaround a commercial task as well as a cost target: rebuilding demand through partners and regional sales coverage. Appointments show action on the plan; they do not yet measure the sales it will produce.
Where the repair is visible
The earlier first-half disclosure gives the October numbers some depth. Continuing-operations operating expenses fell to €17.3 million from €20.9 million, while working capital dropped to about €25.3 million from €45.1 million a year earlier.
For the Components segment, first-half revenue fell to roughly €2.2 million from €4.3 million, but its adjusted EBITDA loss narrowed to €0.7 million from €3.2 million. Cherry said it was prioritizing product mix and margin over volume. This helps explain why improving earnings and weaker sales can appear together.
What October adds
Cherry linked the latest sales decline to deliberate Peripherals channel-inventory clearance. It attributed the earnings improvement to a smaller cost base and a 7.4-percentage-point increase in gross margin.
| Metric | 2026 | 2025 comparison |
|---|---|---|
| Revenue | 58.9 | 70.7 |
| Adjusted EBITDA | −6.9 | −11.9 |
The 2025 adjusted EBITDA comparison excludes €7 million of Active Key disposal proceeds. Figures are unaudited, include Digital Health discontinued operations and are not switch-only results or net profit.
Funding the transition
The balance-sheet work is another part of the rebuild. In July, Cherry reported a fully placed rights issue with around €10.1 million in gross proceeds, subject to registration. The planned Digital Health & Solutions sale is intended to reduce liabilities and release money for the core business; it was still ongoing in October.
October also brought a liquidity commitment of up to €5 million from Cherry TopCo, an indirect Argand subsidiary, through December 31. The commitment does not establish that the full amount has been drawn.
Keebpedia’s reading: cost repair comes before a proven recovery
Taken together, the disclosures make the progress on costs and working capital easier to see than a recovery in demand. The next tests are whether the sales initiatives deliver revenue, the Digital Health transaction closes, and the core business reaches management’s operating targets.
There is also a reporting gap: the 2025 audit remains unfinished, so the nine-month statement will miss its original November 18 publication date. Cherry will announce a replacement date. That leaves the current assessment based on preliminary figures.