Today's announcement of HP purchasing HyperX for $425 million wasn’t exactly what I would have on my list of things that would happen in 2021. I’ve spent the day thinking about this one because in a lot of ways this is a huge bombshell as Jeremy Clarkson would put it. These days, nearly every large company in the PC industry has or has tried to create their own gaming-specific brand. But 18 years ago when Kingston first introduced HyperX the PC industry was very different. Nvidia introduced their FX 5 GPU, Intel still had the Pentium 4 around with their new Pentium 4 EE (Extreme Edition), and AMD was just introducing their Athlon 64.
HyperX was at the time a brand to designate Kingston’s gaming-focused memory which other memory companies later followed and created their own gaming brands as well and that didn’t really change even through the introduction of SSDs which also had HyperX models. The HyperX brand was established and well know, but when they started in the peripheral market it was still a little crazy at the time. They dipped their toes in with a partnership with QPAD for a HyperX mouse pad. They also partnered with SteelSeries at one point with a HyperX branded Siberia v2 headset as well. Then later introduced their Cloud headphones which were interestingly enough in partnership with QPAD and the same as their QH-90. The Cloud headphones for HyperX have been huge in their push into the peripheral market and are still widely accepted as some of the best headphones on the market.
My initial response when seeing the HyperX announcement had me concerned that we were seeing Kingston move out of the gaming market altogether. But after giving the press release a more in-depth read I noticed that HP is only purchasing the peripheral side of things and Kingston will still have everything DRAM, Flash, and SSD. But this still left me wondering if they would still be using the HyperX brand and splitting the brand. I reached out to David Leong at Kingston who said “Kingston has rights to use the HyperX brand for the DRAM and storage products for an undisclosed amount of time. We will transition these products from HyperX to a different brand, which will be announced at a later time.”.
So this does give us at least a small glimpse into the future of Kingston, HyperX, and HP. We can expect to see Kingston introducing new gaming-focused branding on their SSDs, Memory, and flash drives sometime in the future which should be interesting.
As for HP and HyperX, we can only really speculate what HP has in mind. As some of you may know, years ago (2006) HP purchased Voodoo PC which was at the time a Boutique PC builder who in a lot of ways lead the way in showing other Boutique PC brands how to create exclusive products with their own branding. That purchase lead to HP eventually creating their Omen line which was gaming-focused with the help of Voodoo PCs founder Rahul Sood. This leads me to my speculation, you have to wonder if the HyperX pickup isn’t going to lead to HyperX branded PCs, Laptops, and Monitors in the future. The Omen brand has never really taken hold the same way that Alienware, ROG, or Predator have. The peripheral side does allow HP to now have gaming peripherals. They have tried in the past to market Omen peripherals without the results that HyperX has had. So it seems this is a win-win for HP. HyperX which is already popular, especially in esports, could now also help promote their gaming PCs, Laptops, and Monitors while also providing some of the best peripherals to go right along with their hardware.
The full press release is below
Fountain Valley, Calif. – February 24, 2021 – Kingston Technology Company, Inc., a world leader in memory products and technology solutions, today announced a definitive agreement to sell HyperX, its gaming division to HP Inc. The acquisition supports HP’s strategy to drive growth in its Personal Systems business, where gaming and peripherals are attractive segments. HyperX’s award-winning product portfolio spans a range of gaming peripherals, including headsets, keyboards, mice, mouse pads, USB microphones, and console accessories.
“HyperX is a leader in peripherals whose technology is trusted by gamers around the world and we’re thrilled to welcome their outstanding team to the HP family,” said Enrique Lores, President and CEO, HP Inc. “We continue to advance our leadership in Personal Systems by modernizing compute experiences and expanding into valuable adjacencies. We see significant opportunities in the large and growing peripherals market, and the addition of HyperX to our portfolio will drive new sources of innovation and growth for our business.”
PC gaming continues to be one of the most popular forms of video gaming, with the PC hardware industry anticipated to be worth $70 billion by 2023.[i] The global peripherals market is expected to grow to $12.2 billion by 2024, with gaming peripherals representing a disproportionate share of this growth.
“HyperX products are designed to meet the most rigorous demands of all gamers – from casual to the most hardcore – giving them a winning edge and helping them stay on top of their game,” said John Tu, Co-founder and CEO, Kingston. “Both of our companies thrive because we focus on our employees and share the same core values and culture. David Sun (Co-founder and COO) and I saw the possibilities for the HyperX business and its employees and we both realized that this change brings a brighter future for HyperX.”
HP has built a large and growing global gaming portfolio in recent years, led by its OMEN brand and a world-class ecosystem of hardware, software, content, and services. The company continues to push progression in gaming with powerful devices like the OMEN 15 gaming laptop and the HP Pavilion Gaming 16 laptop. Beyond devices, HP is driving software innovation with OMEN Gaming Hub, a destination for players to connect, customize, and explore their gear and games. Adding HyperX to HP’s broader gaming ecosystem will deliver innovative new experiences across everything gamers see, hear, and touch.
Under the terms of the agreement, HP will pay $425M, subject to customary working capital and other adjustments, to acquire HyperX’s gaming peripherals portfolio. Kingston will retain the DRAM, flash, and SSD products for gamers and enthusiasts. The acquisition is expected to be accretive on a non-GAAP basis to HP in the first full year following closing. The transaction is expected to close in calendar Q2 2021, pending regulatory review and other customary closing conditions.
Kingston can be found on: HyperX can be found on:
About Kingston Technology Company, Inc.
From big data, to laptops and PCs, to IoT-based devices like smart and wearable technology, to design-in and contract manufacturing, Kingston helps deliver the solutions used to live, work and play. The world’s largest PC makers and cloud-hosting companies depend on Kingston for their manufacturing needs, and our passion fuels the technology the world uses every day. We strive beyond our products to see the bigger picture, to meet the needs of our customers and offer solutions that make a difference. To learn more about how Kingston Is With You, visit Kingston.com.
About HyperX
For 18 years, HyperX’s mission has been to develop gaming solutions for every type of gamer and the company is consistently recognized for delivering products that provide superior comfort, aesthetics, performance, and reliability. Under the tagline of “WE’RE ALL GAMERS,” HyperX gaming headsets, keyboards, mice, USB microphones, and console accessories are the choice of everyday gamers as well as celebrity ambassadors, pro gamers, tech enthusiasts, and overclockers worldwide because they meet the most stringent product specifications and are built with best-in-class components.
