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Logitech Sales Down As Gaming Market Wobbles

If what is happening in the USA and Europe over their summer, where consumers have flocked to holiday destinations retailers in Australia could face a slow down if Bracken Darrell the CEO of Logitech is right.

Bracken in an interview with US media, tried to justify the slowdown in demand for Logitech products because consumers are spending their summers traveling. He claims that they will come back to purchase tech equipment in the cooler months, especially gamers.

“I think everybody’s doing something this summer, so this is a period when people are out. Our gaming business is down, but I don’t think that’s terribly surprising,” Darrell said.

Global sales were US$1.16 billion, down 12 percent compared to Q1 of the prior year.

Bracken claims that their performance reflects a challenging macroeconomic environment for the industry.

Category sales grew 4 percent with Keyboards web cams mouse and Combos, “essentially flat”.

Video communication devices grew by 5 percent.

The big hit came with a 16% decline in gaming sales with insiders tipping further falls in this category after graphic card manufacturer Nvidia yesterday forecast a sharp drop in revenue in the current quarter of the back of a weaker gaming industry,

The company said it expected third quarter revenue of AU$8.5 billion, down 17 percent on year with the next quarter also looking bleak for the gaming industry.

Operating income at Logitech fell 43 percent to $115 million, compared to $203 million and 143 percent growth in the same quarter a year ago.

“While macroeconomic challenges affected our performance this quarter, I am encouraged by the continued growth in Video Collaboration, Keyboards & Combos and Pointing Devices as hybrid and return-to-work trends continue to take shape,” said Bracken Darrell,

“This quarter, we demonstrated our operational focus in the face of challenging conditions, and off the back of exceptional growth these past two years. While we will cut back our spending given the current environment, our strong innovation engine paired with secular growth trends – hybrid work, video everywhere, gaming, and digital content creation – position us well for the future.”

Logitech shares rose on the news and are up 3.56% this week.



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