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Non-GAAP Operating Income: $312 million, a 17% year-over-year increase.
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Cash Flow: Approximately $500 million, a 30% year-over-year increase.
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Net Sales: $1.4 billion, up 4% year-over-year in constant currency.
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Non-GAAP Gross Margin: 43.5%, up 30 basis points from the prior year.
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Personal Workspace Net Sales: Increased 7%, with 9% growth in pointing devices.
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Video Collaboration Sales: Grew 8%, with double-digit growth in EBITDA and Asia Pacific.
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Gaming Net Sales: Grew 2%, driven by double-digit growth in Asia Pacific.
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Asia-Pacific Growth: 15% year-over-year growth.
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Non-GAAP Operating Expense: $306 million, a decline of 2% year-over-year.
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Cash Conversion Cycle: Improved by 18% to 27 days.
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Cash Balance: $1.8 billion at the end of the quarter.
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4th Quarter Net Sales Outlook: Expected to grow 3% to 5% year-over-year in constant currency.
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4th Quarter Gross Margin Rate Outlook: Approximately 43% to 44%.
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4th Quarter Non-GAAP Operating Income Outlook: Expected to be between $155 and $165 million.
Release Date: January 27, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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Logitech International SA (NASDAQ:LOGI) reported strong financial performance with record non-GAAP operating income and earnings per share, excluding pandemic peaks.
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The company achieved a 6% topline growth in US dollars and 4% in constant currency, driven by broad-based demand across regions, channels, and categories.
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Logitech’s strategic focus on superior products and innovation led to successful product launches, such as the MX Master 4 mouse and AI-powered devices, contributing to market share gains.
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The company significantly reduced the percentage of US products manufactured in China from 40% to less than 10%, enhancing manufacturing diversification.
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Logitech maintained strong cost discipline, with non-GAAP general and administrative expenses down 7% year-over-year, and achieved a non-GAAP gross margin of 43.5%.
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The gaming market in the US and Europe experienced a decline, with Logitech holding share in a shrinking market.
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Concerns about macroeconomic factors, such as consumer confidence and geopolitical dynamics, could impact future performance.
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The company faces challenges from rising commodity prices and component costs, which may affect future gross margins.
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Logitech’s B2B business, particularly video conferencing, is subject to variability and lumpiness in demand quarter to quarter.
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Despite strong performance, the company remains cautious about potential impacts from memory availability issues on certain product lines.
Q: Can you discuss your confidence in achieving long-term growth targets given the current macroeconomic factors affecting PC demand? A: Hanneke Faber, CEO: We are encouraged by the business momentum globally and expect to deliver at the high end of our long-term model this year. Despite challenges, we believe our strategic focus on superior products, B2B growth, and operational excellence will continue to drive success. Memory availability issues are not expected to materially impact us, and we are well-positioned to mitigate any cost impacts.
Q: How do you view the current gross margin performance and its sustainability given the macroeconomic backdrop? A: Matteo Anversa, CFO: We expect to close the year with a gross margin rate around 43.5%, flat to fiscal year ’25. Our strong brand, continuous innovation, and cost reduction efforts provide a solid foundation for maintaining these margins despite rising commodity prices and component costs.
Q: What are your strategies to address declining gaming markets in the US and Europe? A: Hanneke Faber, CEO: We are focusing on winning at both the top end and entry level of the market. In China, we’ve seen strong growth, and we aim to replicate this success in the US and Europe by offering superior products and leveraging new gaming title releases to drive demand.
Q: Can you provide insights into the attachment rates of peripherals to PCs and how this impacts your growth strategy? A: Matteo Anversa, CFO: Historically, our peripherals sales outpace PC sales by 300 to 500 basis points. The biggest opportunity lies in the existing PC installed base, where less than half use a mouse and less than a third use an external keyboard. This presents a significant growth opportunity beyond new PC sales.
Q: Are you seeing any pull-forward demand due to rising memory costs? A: Hanneke Faber, CEO: We have not observed any pull-forward demand in our business, either from consumers or B2B customers. Our sales are driven by strategic execution rather than external factors like memory cost concerns.
Q: How do you plan to maintain market share and manage pricing in a potentially tough PC market environment? A: Hanneke Faber, CEO: We focus on strategic promotions and premiumization to maintain market share. Our growth in personal workspace was driven by a combination of positive units, premiumization, and strategic pricing, and we will continue to adapt our strategies to market conditions.
Q: What are the main factors influencing your Q4 guidance, and how do you view regional performance? A: Matteo Anversa, CFO: Our Q4 guidance reflects continued growth across regions, with Asia-Pacific expected to grow in the mid-teens, low single-digit growth in EMEA, and flat to low single-digit growth in the Americas. The US market’s momentum is a key factor for achieving the high end of our guidance.
Q: How are you managing inventory levels and channel health post-holiday season? A: Hanneke Faber, CEO: We are pleased with our inventory management, maintaining healthy channel inventory levels and excellent own inventory turns. This positions us well as we exit the holiday season.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.