Logitech, sales are still falling and despite the accessory Company failing to find a new CEO shares in the business have soared following the release of their latest financials for the second quarter of 2023.
The stock is up 12.5% this morning after they reported earnings per share of US$1.09 from July to September activities, this was a substantial 30% increase from the previous year.
Sales came in at US$1.06 billion, down 8 percent in US dollars and 9 percent in constant currency, compared to the prior year.
The good news was their premium pricing strategy delivered an operating income of $157 million, up 23 percent compared to the prior year.This was achieved by slashing marketing and a massive reduction in operating costs.
The company, which sells keyboards and accessories, and B2b conference gear, claims that their robust performance can be attributed to the pandemic-induced work-from-home trend, during which consumers flocked to Logitech’s products.
The cost cutting allowed the company to elevate its full-year outlook significantly, with the Company anticipating sales between $4 billion to $4.15 billion for Fiscal Year 2024, a narrower decline of as little as 9%, compared to the earlier projection of a 12% to 16% drop.
A breakdown of its sales by product category for the second quarter reveals that the gaming segment led with $282.104 million, followed closely by keyboards & combos at $194.914 million, and pointing devices at $191.676 million.
While there was lower demand for gaming and video collaboration products, the tablet accessories and headsets businesses experienced growth, contributing to the overall revenue stream.
Logitech management are confident of improved product demand in the latter half of the year claiming that they will benefit from new product launches and the ongoing shift towards hybrid work and learning models, aligning with the changing global landscape.
Amid this financial triumph, Logitech is also on the verge of appointing a new Chief Executive Officer, following the departure of Bracken Darrell in June.
Logitech’s shares surged by 9% in Swiss trading and 12.5% in premarket U.S. trading.
Analysts have praised the company’s precise execution of its business and financial models and its gross margins of 43%.
No data for the Australian market has been declared.
