Gaming Sales Near Pandemic-High Levels;
Company Raises FY 2025 Outlook
SIX Swiss Exchange Ad hoc announcement pursuant to Art. 53 LR
— Logitech International (SIX: LOGN) (Nasdaq: LOGI) today
announced financial results for the third quarter of Fiscal Year
2025.
- Sales were $1.34 billion, up 7 percent in US dollars and 6
percent in constant currency compared to Q3 of the prior year.
- GAAP gross margin was 42.9 percent, up 90 basis points compared
to Q3 of the prior year. Non-GAAP gross margin was 43.2 percent, up
90 basis points compared to Q3 of the prior year.
- GAAP operating income was $235 million, up 6 percent compared
to Q3 of the prior year. Non-GAAP operating income was $266
million, up 7 percent compared to Q3 of the prior year.
- GAAP earnings per share (EPS) was $1.32, down 15 percent
compared to Q3 of the prior year. Non-GAAP EPS was $1.59, up 4
percent compared to Q3 of the prior year.
- Cash flow from operations was $371 million. The quarter-ending
cash balance was $1.5 billion.
- The Company returned $200 million of cash to shareholders
through share repurchases.
“We’re excited to deliver strong, profitable growth once again,
in our biggest quarter of the year,” said Hanneke Faber, Logitech
chief executive officer. “Our growth was driven by our strategic
priorities. We delivered superior innovation. Gaming sales were
near pandemic-high levels, thanks to an outstanding set of
innovations launched ahead of the holidays. We delivered near
record sales in our premium Pro Gaming and MX portfolios. Logitech
for Business made excellent progress. And our teams fielded
effective marketing campaigns and excellent holiday retail
execution to drive broad-based geographic progress.”
“Q3 marks another disciplined quarter,” said Matteo Anversa,
Logitech chief financial officer. “Thanks to our strong operational
performance, we again delivered year-over-year expansion of gross
margin. While we expect fourth quarter currency headwinds, the
strong demand in the third quarter and the continued promotional
and operational discipline of our teams give us confidence about
the trajectory of our business, and we are increasing our full-year
outlook.”
Outlook Logitech raised its full-year outlook for Fiscal
Year 2025:
Previous FY25 outlook
New FY25 outlook
Sales
$4.39 - $4.47 billion
$4.54 - $4.57 billion
Sales growth (in US dollars, year over
year)
2% - 4%
5.4% - 6.4%
Sales growth (in constant currency, year
over year)
2% - 4%
6.2% - 7.1%
Non-GAAP operating income
$720 - $750 million
$755 - $770 million
Non-GAAP op. inc. growth (year over
year)
3% - 7%
8% - 10%
Financial Results Videoconference and Webcast
Logitech will hold a financial results videoconference to
discuss the results for Q3 Fiscal Year 2025 on Tuesday, January 28,
2025 at 1:30 p.m. Pacific Standard Time (PST) and 10:30 p.m.
Central European Time (CET). A livestream of the event will be
available on the Logitech corporate website at
https://ir.logitech.com. This press release and the Q3 Fiscal Year
2025 Shareholder Letter are also available there.
Use of Non-GAAP Financial Information and Constant
Currency
To facilitate comparisons to Logitech’s historical results,
Logitech has included non-GAAP adjusted measures in this press
release, which exclude share-based compensation expense,
amortization of intangible assets, acquisition-related costs,
restructuring charges (credits), net, loss (gain) on investments,
non-GAAP income tax adjustment, and other items detailed under
“Supplemental Financial Information” after the tables below and
posted to our website at https://ir.logitech.com. Logitech also
presents percentage sales growth in constant currency (“cc”), a
non-GAAP measure, to show performance unaffected by fluctuations in
currency exchange rates. Percentage sales growth in constant
currency is calculated by translating prior period sales in each
local currency at the current period’s average exchange rate for
that currency and comparing that to current period sales. Logitech
believes this information, used together with the GAAP financial
information, will help investors to evaluate its current period
performance, outlook and trends in its business. With respect to
the Company’s outlook for non-GAAP operating income, most of these
excluded amounts pertain to events that have not yet occurred and
are not currently possible to estimate with a reasonable degree of
accuracy. Therefore, no reconciliation to the GAAP amounts has been
provided for the Fiscal Year 2025 non-GAAP operating income
outlook.
Public Dissemination of Certain Information
Recordings of Logitech’s earnings videoconferences and certain
events Logitech participates in or hosts, with members of the
investment community are posted on the company’s investor relations
website at https://ir.logitech.com. Additionally, Logitech provides
notifications of news or announcements regarding its operations and
financial performance, including its filings with the Securities
and Exchange Commission (SEC), investor events, and press and
earnings releases as part of its investor relations website.
Logitech intends to use its investor relations website as means of
disclosing material nonpublic information and for complying with
its disclosure obligations under Regulation FD. Logitech’s
corporate governance information also is available on its investor
relations website.
About Logitech
Logitech designs software-enabled hardware solutions that help
businesses thrive and bring people together when working, creating,
gaming and streaming. As the point of connection between people and
the digital world, our mission is to extend human potential in work
and play, in a way that is good for people and the planet. Founded
in 1981, Logitech International is a Swiss public company listed on
the SIX Swiss Exchange (LOGN) and on the Nasdaq Global Select
Market (LOGI). Find Logitech and its other brands, including
Logitech G, at www.logitech.com or company blog.
This press release contains forward-looking statements within
the meaning of U.S. federal securities laws, including, without
limitation, statements regarding: our preliminary financial results
for the three and nine months ended December 31, 2024, Fiscal Year
2025 outlook for sales and non-GAAP operating income, opportunities
for growth, and related assumptions. The forward-looking statements
in this press release are subject to risks and uncertainties that
could cause Logitech’s actual results and events to differ
materially from those anticipated in these forward-looking
statements, including, without limitation: macroeconomic and
geopolitical conditions and other factors and their impact, for
example inflation, interest rate and foreign currency fluctuations,
changes in fiscal policies, geopolitical conflicts, low economic
growth in certain regions, and uncertainty in consumer and
enterprise demand; our expectations regarding our expense
discipline efforts, including the timing thereof; changes in
secular trends that impact our business; if our product offerings,
marketing activities and investment prioritization decisions do not
result in the sales, profitability or profitability growth we
expect, or when we expect it; if we fail to innovate and develop
new products in a timely and cost-effective manner for our new and
existing product categories; issues relating to development and use
of artificial intelligence; if we do not successfully execute on
our growth opportunities or our growth opportunities are more
limited than we expect; the effect of demand variability, supply
shortages and other supply chain challenges; the effect of
logistics challenges, including disruptions in logistics; the
effect of pricing, product, marketing and other initiatives by our
competitors, and our reaction to them, on our sales, gross margins
and profitability; if we are not able to maintain and enhance our
brands; if our products and marketing strategies fail to separate
our products from competitors’ products; if we do not efficiently
manage our spending; our expectations regarding our restructuring
efforts, including the timing thereof; if there is a deterioration
of business and economic conditions in one or more of our sales
regions or product categories, or significant fluctuations in
exchange rates; changes in trade regulations, policies and
agreements and the imposition of tariffs that affect our products
or operations, including potential new tariffs that may be imposed
on U.S. imports and our ability to mitigate; if we do not
successfully execute on strategic acquisitions and investments;
risks associated with acquisitions; and the effect of changes to
our effective income tax rates. A detailed discussion of these and
other risks and uncertainties that could cause actual results and
events to differ materially from such forward-looking statements is
included in Logitech’s periodic filings with the Securities and
Exchange Commission (“SEC”), including our Annual Report on Form
10-K for the fiscal year ended March 31, 2024, our Quarterly Report
on Form 10-Q for the quarter ended September 30, 2024, and other
reports filed with the SEC, available at www.sec.gov, under the
caption Risk Factors and elsewhere. Logitech does not undertake any
obligation to update any forward-looking statements to reflect new
information or events or circumstances occurring after the date of
this press release.
Note that unless noted otherwise, comparisons are year over
year.
Logitech and other Logitech marks are trademarks or registered
trademarks of Logitech Europe S.A. and/or its affiliates in the
U.S. and other countries. All other trademarks are the property of
their respective owners. For more information about Logitech and
its products, visit the company’s website at www.logitech.com.
LOGITECH INTERNATIONAL S.A.
PRELIMINARY RESULTS*
(In thousands, except per share
amounts) - unaudited
Three months ended December
31,
Nine months ended December
31,
GAAP CONDENSED CONSOLIDATED STATEMENTS
OF OPERATIONS
2024
2023
2024
2023
Net sales
$
1,340,294
$
1,255,473
$
3,544,545
$
3,286,980
Cost of goods sold
763,403
726,252
2,010,411
1,937,367
Amortization of intangible assets
2,450
2,441
7,344
8,569
Gross profit
574,441
526,780
1,526,790
1,341,044
Operating expenses:
Marketing and selling
217,048
189,175
615,816
544,716
Research and development
77,973
72,704
229,485
211,822
General and administrative
42,117
39,711
123,748
116,546
Amortization of intangible assets and
acquisition-related costs
2,637
2,276
8,065
8,279
Restructuring charges, net
110
839
725
2,562
Total operating expenses
339,885
304,705
977,839
883,925
Operating income
234,556
222,075
548,951
457,119
Interest income
12,176
12,826
42,603
34,508
Other income (expense), net
(1,524
)
189
(2,889
)
(13,827
)
Income before income taxes
245,208
235,090
588,665
477,800
Provision for (benefit from) income
taxes
45,061
(9,594
)
101,202
33,272
Net income
$
200,147
$
244,684
$
487,463
$
444,528
Net income per share:
Basic
$
1.33
$
1.57
$
3.20
$
2.82
Diluted
$
1.32
$
1.55
$
3.18
$
2.80
Weighted average shares used to compute
net income per share:
Basic
150,647
155,933
152,127
157,568
Diluted
151,895
157,440
153,506
158,843
LOGITECH INTERNATIONAL S.A.
PRELIMINARY RESULTS*
(In thousands, except per share
amounts) - unaudited
December 31,
March 31,
CONDENSED CONSOLIDATED BALANCE
SHEETS
2024
2024
Current assets:
Cash and cash equivalents
$
1,502,832
$
1,520,842
Accounts receivable, net
648,230
541,715
Inventories
483,569
422,513
Other current assets
139,523
146,270
Total current assets
2,774,154
2,631,340
Non-current assets:
Property, plant and equipment, net
109,547
116,589
Goodwill
461,183
461,978
Other intangible assets, net
29,161
44,603
Other assets
357,515
350,194
Total assets
$
3,731,560
$
3,604,704
Current liabilities:
Accounts payable
$
578,951
$
448,627
Accrued and other current liabilities
715,267
637,262
Total current liabilities
1,294,218
1,085,889
Non-current liabilities:
Income taxes payable
129,497
112,572
Other non-current liabilities
205,027
172,590
Total liabilities
1,628,742
1,371,051
Shareholders’ equity:
Registered shares, CHF 0.25 par value
Issued shares: 168,994 and 173,106 at
December 31, 2024 and March 31, 2024, respectively
29,432
30,148
Additional paid-in capital
95,162
63,524
Shares in treasury, at cost — 19,555 and
19,243 at December 31, 2024 and March 31, 2024, respectively
(1,381,949
)
(1,351,336
)
Retained earnings
3,494,495
3,602,519
Accumulated other comprehensive loss
(134,322
)
(111,202
)
Total shareholders’ equity
2,102,818
2,233,653
Total liabilities and shareholders’
equity
$
3,731,560
$
3,604,704
LOGITECH INTERNATIONAL S.A.
PRELIMINARY RESULTS*
(In thousands) - unaudited
Three months ended December
31,
Nine months ended December
31,
CONDENSED CONSOLIDATED STATEMENTS OF
CASH FLOWS
2024
2023
2024
2023
Cash flows from operating
activities:
Net income
$
200,147
$
244,684
$
487,463
$
444,528
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation
15,075
14,739
44,178
48,874
Amortization of intangible assets
5,087
5,074
15,258
16,583
Loss on investments
119
604
1,718
12,213
Share-based compensation expense
26,193
20,613
76,067
64,192
Deferred income taxes
2,163
(20,623
)
18,652
(9,515
)
Other
73
236
130
336
Changes in assets and liabilities, net of
acquisitions:
Accounts receivable, net
(46,366
)
(11,424
)
(127,934
)
(46,786
)
Inventories
26,353
91,600
(67,554
)
237,969
Other assets
7,175
(8,301
)
9,416
3,698
Accounts payable
28,472
32,361
136,848
120,383
Accrued and other liabilities
106,379
73,389
118,659
13,536
Net cash provided by operating
activities
370,870
442,952
712,901
906,011
Cash flows from investing
activities:
Purchases of property, plant and
equipment
(14,227
)
(10,854
)
(43,340
)
(45,585
)
Acquisitions, net of cash acquired
—
—
—
(14,138
)
Purchases of deferred compensation
investments
(2,202
)
(5,345
)
(5,802
)
(7,893
)
Proceeds from sales of deferred
compensation investments
2,659
5,571
4,958
8,193
Other investing activities
(261
)
(50
)
(1,173
)
(406
)
Net cash used in investing
activities
(14,031
)
(10,678
)
(45,357
)
(59,829
)
Cash flows from financing
activities:
Payment of cash dividends
—
—
(207,853
)
(182,305
)
Payment of contingent consideration for
business acquisition
—
—
(1,245
)
(5,002
)
Purchases of registered shares
(200,137
)
(187,834
)
(463,322
)
(376,775
)
Proceeds from exercises of stock options
and purchase rights
—
—
20,235
15,319
Tax withholdings related to net share
settlements of restricted stock units
(1,008
)
(2,372
)
(22,251
)
(28,596
)
Other financing activities
—
—
(1,663
)
(1,116
)
Net cash used in financing
activities
(201,145
)
(190,206
)
(676,099
)
(578,475
)
Effect of exchange rate changes on cash
and cash equivalents
(16,138
)
6,678
(9,455
)
(4,080
)
Net increase (decrease) in cash and
cash equivalents
139,556
248,746
(18,010
)
263,627
Cash and cash equivalents, beginning of
the period
1,363,276
1,163,904
1,520,842
1,149,023
Cash and cash equivalents, end of the
period
$
1,502,832
$
1,412,650
$
1,502,832
$
1,412,650
LOGITECH INTERNATIONAL S.A.
PRELIMINARY RESULTS*
(In thousands) - unaudited
SUPPLEMENTAL FINANCIAL
INFORMATION
Three months ended December
31,
Nine months ended December
31,
NET SALES
2024
2023
Change
2024
2023
Change
Net sales by product category:
Gaming (1)
$
466,715
$
409,043
14
%
$
1,076,660
$
957,576
12
%
Keyboards & Combos
236,748
229,432
3
662,017
605,201
9
Pointing Devices
217,045
206,180
5
602,927
572,310
5
Video Collaboration
176,053
169,522
4
482,755
461,257
5
Webcams
84,419
85,851
(2
)
237,572
249,273
(5
)
Tablet Accessories
77,433
64,239
21
241,586
198,252
22
Headsets
45,886
41,762
10
137,038
123,023
11
Other (2)
35,995
49,444
(27
)
103,990
120,088
(13
)
Total Net Sales
$
1,340,294
$
1,255,473
7
%
$
3,544,545
$
3,286,980
8
%
(1) Gaming includes streaming services
revenue generated by Streamlabs.
(2) Other primarily consists of mobile
speakers and PC speakers.
LOGITECH INTERNATIONAL S.A.
PRELIMINARY RESULTS*
(In thousands, except per share
amounts) - unaudited
SUPPLEMENTAL FINANCIAL
INFORMATION
Three months ended December
31,
Nine months ended December
31,
GAAP TO NON-GAAP RECONCILIATION
(A)
2024
2023
2024
2023
Gross profit - GAAP
$
574,441
$
526,780
$
1,526,790
$
1,341,044
Share-based compensation expense
2,173
2,189
8,673
6,066
Amortization of intangible assets
2,450
2,441
7,344
8,569
Gross profit - Non-GAAP
$
579,064
$
531,410
$
1,542,807
$
1,355,679
Gross margin - GAAP
42.9
%
42.0
%
43.1
%
40.8
%
Gross margin - Non-GAAP
43.2
%
42.3
%
43.5
%
41.2
%
Operating expenses - GAAP
$
339,885
$
304,705
$
977,839
$
883,925
Less: Share-based compensation expense
24,020
18,424
67,394
58,126
Less: Amortization of intangible assets
and acquisition-related costs
2,637
2,276
8,065
8,279
Less: Restructuring charges, net
110
839
725
2,562
Operating expenses - Non-GAAP
$
313,118
$
283,166
$
901,655
$
814,958
% of net sales - GAAP
25.4
%
24.3
%
27.6
%
26.9
%
% of net sales - Non-GAAP
23.4
%
22.6
%
25.4
%
24.8
%
Operating income - GAAP
$
234,556
$
222,075
$
548,951
$
457,119
Share-based compensation expense
26,193
20,613
76,067
64,192
Amortization of intangible assets and
acquisition-related costs
5,087
4,717
15,409
16,848
Restructuring charges, net
110
839
725
2,562
Operating income - Non-GAAP
$
265,946
$
248,244
$
641,152
$
540,721
% of net sales - GAAP
17.5
%
17.7
%
15.5
%
13.9
%
% of net sales - Non-GAAP
19.8
%
19.8
%
18.1
%
16.5
%
Net income - GAAP
$
200,147
$
244,684
$
487,463
$
444,528
Share-based compensation expense
26,193
20,613
76,067
64,192
Amortization of intangible assets and
acquisition-related costs
5,087
4,717
15,409
16,848
Restructuring charges, net
110
839
725
2,562
Loss on investments
119
604
1,718
12,213
Non-GAAP income tax adjustment
9,834
(29,963
)
18,820
(22,033
)
Net income - Non-GAAP
$
241,490
$
241,494
$
600,202
$
518,310
Net income per share:
Diluted - GAAP
$
1.32
$
1.55
$
3.18
$
2.80
Diluted - Non-GAAP
$
1.59
$
1.53
$
3.91
$
3.26
Shares used to compute net income per
share:
Diluted - GAAP and Non-GAAP
151,895
157,440
153,506
158,843
LOGITECH INTERNATIONAL S.A.
PRELIMINARY RESULTS*
(In thousands) - unaudited
SUPPLEMENTAL FINANCIAL
INFORMATION
Three months ended December
31,
Nine months ended December
31,
SHARE-BASED COMPENSATION
EXPENSE
2024
2023
2024
2023
Share-based Compensation
Expense
Cost of goods sold
$
2,173
$
2,189
$
8,673
$
6,066
Marketing and selling
11,813
8,878
34,133
28,623
Research and development
5,043
4,421
15,849
13,568
General and administrative
7,164
5,125
17,412
15,935
Total share-based compensation
expense
26,193
20,613
76,067
64,192
Income tax benefit
(4,523
)
(3,391
)
(16,901
)
(11,257
)
Total share-based compensation expense,
net of income tax benefit
$
21,670
$
17,222
$
59,166
$
52,935
*Note: These preliminary results for the three and nine months
ended December 31, 2024 are subject to adjustments, including
subsequent events that may occur through the date of filing our
Quarterly Report on Form 10-Q.
(A) Non-GAAP Financial Measures
To supplement our condensed consolidated financial results
prepared in accordance with GAAP, we use a number of financial
measures, both GAAP and non-GAAP, in analyzing and assessing our
overall business performance, for making operating decisions and
for forecasting and planning future periods. We consider the use of
non-GAAP financial measures helpful in assessing our current
financial performance, ongoing operations and prospects for the
future as well as understanding financial and business trends
relating to our financial condition and results of operations.
While we use non-GAAP financial measures as a tool to enhance
our understanding of certain aspects of our financial performance
and to provide incremental insight into the underlying factors and
trends affecting both our performance and our cash-generating
potential, we do not consider these measures to be a substitute
for, or superior to, the information provided by GAAP financial
measures. Consistent with this approach, we believe that disclosing
non-GAAP financial measures to the readers of our financial
statements provides useful supplemental data that, while not a
substitute for GAAP financial measures, can offer insight in the
review of our financial and operational performance and enables
investors to more fully understand trends in our current and future
performance. In assessing our business during the quarter ended
December 31, 2024 and prior periods presented, we excluded items in
the following general categories, each of which are described
below:
Share-based compensation expense. We
believe that providing non-GAAP measures excluding share-based
compensation expense, in addition to the GAAP measures, allows for
a more transparent comparison of our financial results from period
to period. We prepare and maintain our budgets and forecasts for
future periods on a basis consistent with this non-GAAP financial
measure. Further, companies use a variety of types of equity awards
as well as a variety of methodologies, assumptions and estimates to
determine share-based compensation expense. We believe that
excluding share-based compensation expense enhances our ability and
the ability of investors to understand the impact of non-cash
share-based compensation on our operating results and to compare
our results against the results of other companies.
Amortization of intangible assets. We
incur intangible asset amortization expense, primarily in
connection with our acquisitions of various businesses and
technologies. The amortization of purchased intangibles varies
depending on the level of acquisition activity. We exclude these
various charges in budgeting, planning and forecasting future
periods and we believe that providing the non-GAAP measures
excluding these various non-cash charges, as well as the GAAP
measures, provides additional insight when comparing our gross
profit, operating expenses, and financial results from period to
period.
Acquisition-related costs. We incurred
expenses and credits in connection with our acquisitions which we
generally would not have otherwise incurred in the periods
presented as a part of our continuing operations.
Acquisition-related costs include certain incremental expenses
incurred to effect a business combination. We believe that
providing the non-GAAP measures excluding these costs, as well as
the GAAP measures, assists our investors because such costs are not
reflective of our ongoing operating results.
Restructuring charges (credits), net.
These charges (credits) are associated with restructuring plans,
and will vary based on the initiatives in place during any given
period. Restructuring charges may include costs related to employee
terminations, facility closures and early cancellation of certain
contracts as well as other costs resulting from our restructuring
initiatives. We believe that providing the non-GAAP measures
excluding these items, as well as the GAAP measures, assists our
investors because such charges (credits) are not reflective of our
ongoing operating results.
Loss (gain) on investments. We
recognize losses (gains) related to our investments in various
companies, which vary depending on the operational and financial
performance of the companies in which we invest. These amounts
include our losses (earnings) on equity method investments,
investment impairments and losses (gains) resulting from sales or
other events related to our investments. We believe that providing
the non-GAAP measures excluding these items, as well as the GAAP
measures, assists our investors because such losses (gains) are not
reflective of our ongoing operations.
Non-GAAP income tax adjustment.
Non-GAAP income tax adjustment primarily measures the income tax
effect of non-GAAP adjustments excluded above as well as the income
tax impact of non-recurring deferred taxes, tax settlements, and
other non-routine tax events, the determination of which is based
upon the nature of the underlying items. For the three and nine
months ended December 31, 2023, non-GAAP income tax adjustment
included the tax benefit from a remeasurement of the tax basis of
goodwill under the Swiss Federal Act on Tax Reform and AHV
Financing (“TRAF”) during the three months ended December 31,
2023.
Each of the non-GAAP financial measures described above, and
used in this press release, should not be considered in isolation
from, or as a substitute for, a measure of financial performance
prepared in accordance with GAAP. Further, investors are cautioned
that there are inherent limitations associated with the use of each
of these non-GAAP financial measures as an analytical tool. In
particular, these non-GAAP financial measures are not based on a
comprehensive set of accounting rules or principles and many of the
adjustments to the GAAP financial measures reflect the exclusion of
items that are recurring and may be reflected in the Company’s
financial results for the foreseeable future. We compensate for
these limitations by providing specific information in the
reconciliation included in this press release regarding the GAAP
amounts excluded from the non-GAAP financial measures. In addition,
as noted above, we evaluate the non-GAAP financial measures
together with the most directly comparable GAAP financial
information.
Additional Supplemental Financial Information - Constant
Currency
In addition, Logitech presents percentage sales growth in
constant currency to show performance unaffected by fluctuations in
currency exchange rates. Percentage sales growth in constant
currency is calculated by translating prior period sales in each
local currency at the current period’s average exchange rate for
that currency and comparing that to current period sales.
(LOGIIR)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250128828957/en/
Editorial Contacts: Kate Beerkens, Director of Investor
Relations - ir@logitech.com Nicole Kenyon, Head of Global
Communications - nkenyon@logitech.com (USA) Ben Starkie, Corporate
Communications - +41 (0)79-292-3499, bstarkie1@logitech.com
(Europe/Asia)
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