LOGN.SW - Earnings call transcript Q3 2025 | Logitech International S.A.

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Nate Melihercik

Good afternoon, and good evening. Welcome to Logitech's video call to discuss our financial results for the third quarter of fiscal year 2025.

Joining us today are Hanneke Faber, our CEO; and Matteo Anversa, our CFO.

During this call, we will make forward-looking statements, including with respect to future operating results under the safe harbor of the Private Securities Litigation Reform Act of 1995. We're making these statements based on our views only as of today.

-- differ could sales actual results materially. could Our update any of undertake no statements. revise to obligation We these or

are and We the available will results on filings in and our a and currency factors noted forward-looking year-over-year reconciliation materials to our also statements be will can These website. of materials with that call between all Relations shareholder are our you at discuss page Hanneke? use a will now this recorded well a press I constant Unless website. review financial call net as GAAP the non-GAAP available the could financial for of in impact webcast SEC. and turn sales. carefully. results otherwise, Investor periods in the you measures our of comparisons our non-GAAP This between non-GAAP We call over and Hanneke. letter our about results, replay information encourage and as and and and being these find to and release is

Johanna Faber

our you, quarter welcome, and everyone, third Nate, to earnings call. Thank

I'm holiday, As to performed for you holiday quarter And for us quarter. that is share the the delivering this at strong Logitech, consecutive all profitable very our fourth biggest. very well important we seasonally a know, quarter thrilled growth

the X%, sales broad-based Net sell-out or across grew X% versus growth was and and Demand accelerated to last growth year. categories regions.

the outlook our a for year. result, raising we're As

with growth last our Importantly, driven strategic I by was you that the spring. priorities shared

and launched year. translated with world. demand last of new of double gaming, holiday highs, reached XX the our consumers First, plus near holidays, customers sales superior lineup advance with we pandemic quarter In growing new innovation. a DNA, went and which which around fantastic products the into and at digits versus loved the in XX% in It's strong design-led products, into

agentic just co-host achieved ahead, sales. Our Pro was And a gaming collaboration a and athletes we for content and fans. with their and with announced designed streaming an NVIDIA them better in innovation assistant giving sidekick line to a reach eSports developed an CES. standout is record collaboration in AI This developed create producer, streamers, instant AI looking professional at

like fueled in particularly innovation the our this end. across success Superior has portfolio, high

For mice, including example, levels line our new MX for designers, that and reached creative of near webcams, was premium console this the keyboards quarter. digital sales record MX developed

Our innovation months were our to AI increasingly leverages X that smarter, make possible driving ago. features even products new not

our video come. advanced framing X-way headsets powered on site, AI-driven meeting AI And to agent gamers, truly of a processing last Time's was the unique best uses quarter. as canceling to XXXX offer our There's addition for streaming noise camera, switching by for experience more newest the In room just smart AI Logitech I mentioned, edge. recognized one sound of which and inventions tabletop the

any development. space. this Just any AI AI integrated a provide last and in flows they product mobile more our applications play creates as meeting you experience we week, is even to Board short come. into more In time, there better the into more for can meetings for of This successfully have our display roll of categories, XX, The digital cocoon key room. work in a that a of and nearly AI Rally all much conferencing just solution opportunities portable touchscreen us week edge and developments position last video into easily we capabilities a immersive announced a amount with

focus strong Logitech channel for our driver strategic for on down Business. second us. important The results of an is growth BXB in Doubling strategic was the

Services Business of satisfaction, than workplaces. XX%. than to the that strong growth yielded we as well education Logitech our into bookings, new personal headsets growth customers customers. for of work as continued the expansion events an at continues in momentum, customer The video important modern of Logi needs products vertical created BXB more in of with doubled, and resulting This driver collaboration workspace in quarter, sell team more to engagement and the meet evolving

innovative solutions, Just Streamline tools, they with a for sales global month, including are the mentioned, and new resonating I dedicated from education commercial Spot Board BXB very well higher this launched customers. with go-to-market sensor. Logitech XX range Rally Rally smart These of office just camera our initiatives the kit forces the new combined

you underscores meet and our to local practices geographies. opportunities growth broad-based This at rapidly countries. this across look and reapplying quarter, best it demands tailoring strategic when execution across Next, our our was approach,

around want I truly effective QX, holiday marketing making we're excellent For in-store China. very Notably, execution. delivering online the to and and in teams for congratulate retail world progress our campaigns

Our end year-over-year. markets drive robust saw double-digit helping sales in growth, to net there increase a Logitech's

lower media diversify social In mind, in end work reductions a a but resilient use and and global be We'd China. units our above you we showcase Our our as for on in Day growth to XX%. industry-leading potential driven products play ways. outcomes our locations outside for chain. of coming to premium drove office that to with scheduled possible and thrilled love will new continued our is of Last refreshing tariffs track the Analyst not delivery an at in momentum from range teams strong in and in priorities. finally, our profitable admirable America are of continue strategy summary, market of exceptional you. our operations with prepare Once the of doing regaining further online. underpinned that still Investor sales least, discuss we fiscal ever or as I'm X, and channels on team. quickly North in exciting China again, shipped for new our manufacturing And gross the execution, of both the extend against our supply China our introducing over host by end over work, execution China Matteo, have we I It's reposition everyone's And the our innings our by the certainly by well and to cost margin online our early at mission year. with progress longer-term us more footprint quarter of half and Silicon pleased very Valley reminder, innovation. that as to human to real March our strategic report and well remain when a we results, we're to

Matteo Anversa

press which sales financial year-over-year, Hanneke. call the in let our Europe quarter. product Asia share our driven also All would key found the hit demand grew me be our The end net briefly very and points were was with you, in sales but categories mentioned, like levels did Gaming high for joining net you line and for line last net Demand X shareholder quarter. and outlook. double Net of growing digits. year-over-year. well. the letter, broad-based you consumer sales of record highlights approaching Regionally, And our all channels, seen I financial digits, detailed for and up exceptional sales grew out our business profitable during in the The the to delivered grew all the high by call with can regions MX business year-over-year as sales. And growth. key pandemic. particular another right. Americas today. near high net record ahead came X% Thank the Hanneke single strong and team quarter results mid-single digits with Thank the release in and hit Pro both

the and balanced healthy a with channel targets. quarter season. third both well quarter, holiday our inventory successful a channel ended we the exit entered as levels We within which and supported owned inventory, operating And

sell-in, the points reduction operational in expect sell-through XX this year-over-year, margin testament trend expansion, the this real of indicated driven profitable. we non-GAAP fourth third gross reductions also basis the Most cost XX.X% margin by our highly continued to to costs. we in the in in to marks continue the and rate As The excellence. earnings consecutive call, our gross quarter. of importantly, a initiatives product And third rate to prior was be and commitment fifth quarter, growth outpaced up year-over-year durability quarter the quarter, in

As margin of higher to expect the range previously XX% end of our a this provided on for be to year rate the XX%. fiscal gross result, we

Moving was to a of $X the of inability e-commerce expenses. charge to due impacted reserve OpEx by providers QX one debt operating to million payment for our bad us. pay

slightly provider. up X% expenses of We would charge, year-over-year. have new transitioned the and been net a than this previous XX.X% lower of And since year. excluding to been sales, would have the marketing impact have operating Sales

it would compared year. sales, Non-GAAP charge we third And flat been And operating to of additionally, to the XX.X% G&A maintaining in the of excluding basis the compared mentioned points income R&D while up I year. earlier, that last to quarter XXX invest prior year-over-year. increased by X% net have continue

In $XXX billion. remains from cash of cash quarter, operations, position a $X.X generation healthy to cash the robust. generated Our million we contributing of

the through share fiscal we repurchases as a and quarter, our to third dividends In share million shareholders flexibility further In to year beginning billion have over we our announced repurchases. position. $X 'XX, strengthen million program. credit $XXX ongoing of $XXX will returned addition, through which enhance financial we And facility, million believe buyback $XXX we and our shareholders the X-year since part financial of returned

update well, outlook and our -- call would our position. fiscal are are confident since we will looking like out that to XXXX extremely out underlying Now business There close our in that ahead, this we performing increased items we is X a quarter. strong have year I last year

faced we headwind the will likely to results the in strengthening our this recent of first, that debt earlier, negatively the that it dollar. is quarter, U.S. a bad an as we second, million And expense. mentioned quarter Now fourth isolated be I in $XX by believe impacted related

at and full with executing external to sales these are our business headwind level us and of the income. dynamic Despite the debt foreign both our a We raising business environment continued and end, We which our approximate and quarter unforeseen year core is to an not bad year But end about end operate, tariffs underlying operating are million fiscal business fluctuations. these together, of teams. the the for speak possible our an outlook inflation, and represent $XX strong pressure, outlook year million our strong the to testament net and performance positioned uncertainties. to our items and often is our tremendous the and flexibility ultimately headwind, to the fiscal adjusting Taken a of delivered and Absorbing this transitory. gives we are raise XXXX currency $XX near high in related confidence another momentum. exchange in year resiliency

ready are the Q&A. we now So for

Nate Melihercik

so much, Thank you Matteo.

Citi. with We [Operator Instructions] session. first the will Q&A now Merchant question move comes Asiya to Our from

Asiya Merchant

Very just here, strong margins. on results gross

continue You of the guys end to deliver that. high obviously towards

about this I You've delivering. from impact these unwinding inventory was quarter. no are there cost controls talked that And take in it, reserves

look momentum So as ahead, look 'XX. we if you're we exiting just you and December that entering trajectory the March of with into fiscal into an look as

for the see further to margin they towards if So could end fiscal to you continue and what momentum? range higher gross your that are some margins the into see and puts here drivers, takes deliver 'XX of continue to

Matteo Anversa

Asiya. Sure, for question. the Thanks

engineering, activities fantastic you're operating the absolutely cost and Really such impact by bill reductions. of and you primarily There clean, driving taking his material. the team value the very no And this right. [indiscernible] So of the by team was quarter out inventory job from as product exactly a coming cost The very as was keep so operational. mentioned. done

engineering value ongoing an is Now process.

year. And good every is programs. basically start going will this a to a effort for to years to And pipeline a also of set have done. pretty have never continued entering year, And come. we next into you that continue You're be new

all the are obviously by longer bit As continuous has term. I you look the in We ever we super as refrain thrilled will improvement, the to financials March forward been it's work now doing. and updating giving but I little continuous on more details from you're the it pertain said, at right you Day of team done. to a 'XX X, the Investor

Nate Melihercik

Alex Our Sachs. Duval Goldman comes with from next question

Alexander Duval

couple, may. quick a Just if I

further saw attach VC side. we quarter on you've services. Firstly, And seen of some clearly, another stabilization talking about growth of the and

PC in question, So that. been refresh then and wondered devices of talk upgrades Windows showing expand other if you a there's side, on I the could there. I growth the early on to purchased also Clearly, guess, just And COVID.

I perspectives you could those. if give on So wondered your latest

Johanna Faber

And think budgets customer bit. Yes, smarter. but VC, getting the IT happy the we're do AI seeing to us. overall many office always a to to having, of how the in little thing a we're we're work days want a And that. going of yes, market how spending from improving turn, course, there's little discussions then, flattish, many choices I good still in making remodelings, seeing that is are leads office. they forward, to customers return and which office that for

then So really really, bit the better. little channel market in the and overall VC within demand Both by driven that's the maybe and quite well. And is sales here than that, even products VC a we quarter. And the we're becoming executing a innovation. are think you sales saw BXB superior higher,

the very on is indeed, then strengthening especially increased to go-to-market which said, starting as satisfaction. And with growth. you because great sales verticals, about. get really our doubled, talent, touched some services those we're scale XX% of with I some coverage, remarks, drives that It's to are capabilities some the also And of in attach customer profitable. which education our excited better

So Business. we're for on Logitech bullish

of that business. new And PC terms and no before, cycles super certainly, is think people work about receiving adding time one In direct But or refreshes definitely products. and cycle a there's to of I've also at buying PC as PC refresh said PC in is correlation our good our a PCs, with underway.

it super So is keyboards. PCs and super need and underway those new mice

Nate Melihercik

question comes Stanley. Woodring Morgan from next Our with Erik

Erik Woodring

I your wondering if a It's on have may. double-click I challenging -- I very was of could two, kind China. if just overall. Hanneke, been market you comments on

that's positioning my But question, feel you what over quarter? -- trying out this double called that kind see? in inflecting a and above? of things get something handful and maybe do doing China at just I Is you're market market of And then click quarters. is, you is the what's also You've guess specifically follow-up. And could dynamic if level I'm China Logitech kind that turned for like then within turned around have love Logitech you I'd inflecting that's have specifically, last of maybe to specifically changing? there there I a

Johanna Faber

it's Erik, of And both above. Absolutely. Yes. the

I'm really momentum in in So we're pleased China. that the our seeing with improving business

within little we a And As growth the out, for break net APAC. you've you that, it sales average. a double-digit than did know, but seen better China don't even

So what's driving the that's things mentioned. both good. that? you of It's And

going Beauty in consumers is past, going it I market, grow a And for well. when So at doing first what's market so little a the Lipstick is of cash all, actually gaming that? form in continues is Gaming are strapped, movies, true entertainment really the to the cheaper a that and called fast Effect clip Gaming driving market to to in eat, as than That This the of out China. the well. we came from

innovation which China. Another course, driver of in gaming. competitive of in to of lot is of the the popularity this environment first-person increasing shooters continues really be dynamic, there's And a means

overall growth So and our that very our of one China. is in and growth is gaming that market driver robust,

teams China new it China, And Second great at and social the and for really in work, selling, which some doing lower introducing the new piece, really premium stuff products doing end. to Pinduoduo. on though, and are they're is they're on end is both Douyin, and comes TikTok quickly both marketing exciting when our

really we're in regaining And liking the as encouraging I'm China. well. we're I especially in And at channels just premium seeing and share mentioned those especially so momentum progress, the

Erik Woodring

seen so not perspective, your one of I'm the strong, it the of right that before clarification demand a is forward trying Again, is a whether from kind you're wondering, they channel from pull you of for That's understand bit get question but make inventory. to little there something potential channel partners? to see and just arise. of to But bit. And price partners was channel wondering me. what taking has a potential then products at it's sell-through a that And get hearing been demand can Matteo, threat just just of the your I your something maybe a sure from just of this tariffs tariffs forward pull specific step necessarily is kind not Logitech, back, we've

Matteo Anversa

we not been progressing we Sure, are for tell really, what you, earlier, Erik. can Things What feel very at we see. I could Not least yet normally. to Hanneke's have pretty prepared. point

of for been we chain -- supply have on quite Our working own time. this our diversification some

We have multiple in sites manufacturing multiple countries.

saw look to So more there few order we customers really final -- third It's the you inventory at for resilience. More but pull and case example, did think on upon related we ready. the ourselves on supply are in second, runners when then question, inventory, about you determination inventory down chain even your actually sequentially, to quarter we went versus -- protect in a right the tariffs. a we is the in

Nate Melihercik

with question Our Jörn comes UBS. next Iffert from

Joern Iffert

around, on is being totally one year-over-year, flattish clarify wrong, pretty calculation. is, and This back really think, I year-over-year concept outlook, profit The prudence? would to what which and XX% more going QX first you of it? range basic background on XX% you're also Can be less implied first the is if I'm your please. XX%, seeing analog please, sales is Or one EBIT means and non-GAAP margin, down it it, or question, gross if not the of the the

Matteo Anversa

that take will one. I Okay.

So onion let you, for me peel the Jörn.

sales to continue margin on is okay? mid-single point to far we our okay? As in you starting Demand prepared of the of So in you FX be question, on your in in I had. that correct. gross that be And the currency up in successful the as translates see digit, this net net But in holiday quarter impact sales, back the just digits, range we from to when expected very low factor depending of are. strong which side remarks, to top, the my the mid-single constant demand that mentioned the is --

rate So gross quarter. be to expecting we fourth around in the are margin XX.X%

things is year-over-year. that my prepared the FX One impact fundamentally So happening remarks. there are mentioned in X I

As us, compared it's major primarily has you substantially have seen other the dollar to U.S. recent the strengthened quite for in the currencies and euro. weeks,

that's pressure fourth coming And to in little still of the was channel the rate. coming inventory were about enjoying release tailwind reserves from a then So it's on last of gross points we going about not year-over-year, the year, That's XXX quarter. bit as down. basis repeat margin

margin rate XXX the that's it, gross So about, year-over-year. points why down is basis roughly call

of FX of if dynamic, the and however, inventory exclude exclude if impact income the operating the you much be you the flat. So impact this pretty would

by notwithstanding the all that testament I further rewind the you the that a So call. pressures and Basically, the in just said little $XXX last a about pretty mentioned I bit what considering of challenges some that the these earnings we my a our to team by for million I really step million outlook in to improving mentioned, prepared are in And if has margin. done think bit It's guidance take we a little flow-through, back is revenue us about $XX a work remarks. allowing year. great the in nice raise really

Johanna Faber

I was add, been we've all year. because mean, I just Jörn, going about this to talking

will lowered robust to do sell But the year be in the the that times said the constant So end of quarter, mid-single-digit. the sellout. in be fourth in again, will many demand before, in currency we've expect we as continue the towards to sell-out,

be So positive. that's seeing, do it you're dynamic the expect to we but

Joern Iffert

the the and maybe sell-in ourselves something we higher question, me that if a the for or When sell-out. may. second prepare said tight digit was should sell-out half expect and Is seeing in we around deviation the 'XX first brings will is this first flattish first maintain this against for half, half are not pace versus the manically, the big I you sell-in look to into just would 'XX it is 'XX? you mid-single I comps And more

Matteo Anversa

that year an we at of beginning we we the if channel a the the surprised Jörn, fiscal last mentioned we And happening created first 'XX exiting this. Hanneke dynamic imbalance will the saw light. what you -- reversed sell-in quarter 'XX, exactly of of outpace remember, in we of sure, half channel in the why first in some of fiscal the in of for of year if And bit, spent quarter fixing that in positive bit third which -- sellout, of the this 'XX. were of if we been months basically then a right, the half we this a bit the revenue that's couple growth little said the that half inventory. 'XX, And 'XX tape -- itself year, 'XX, but we of fiscal We the fourth. is in second the what mentioned fourth the has year was of and rewind

maintain held to strong and healthy such continue is to way This holiday to enabled is plan what in really quarter. a channel Our a a us inventory.

do if we So we want happening And are to to dynamic not see that. next year. continue should successful, same the you then

next throughout will you see year. So the each sell-through sell-in to closer year and mirror other

Joern Iffert

higher, I check may. one included I could non-GAAP EBIT, if even the be this for just a of technical because this this amount were through Very one, this be all but would go the EBIT SG&A details, double not to highlighting, adjusted right? is you one-off quickly. to sure your So in last question, It's

Matteo Anversa

That is correct.

So in it marketing is included sales first but in not booked G&A, was $XX of all, numbers. and in the and our million

Nate Melihercik

with next from comes Capital. Loop Our question Ananda

Ananda Baruah

durability are way at in some compares, go refreshes the There's guess of And tough of just revenue. then gaming There levels the also you there's typically, these those. quick tougher record out. real of pull-through a the later as ahead comp through are starting important I gaming up year, compares results coming year. through you What's you good the think coming good go to on about as gaming. year? new

I'd get that. love on to your just So take there, starting

Johanna Faber

U.S. faster the talked We're markets. what I but mentioned the you the I'm about back gaining we're not in that excited and gaining is in regaining growing and share, but Sim. the double-digit robust fourth of I about year our China. gaming for Sim, which an super in the give in did momentum quarter we're mention of going ahead, growth we to end I we're a bullish quarter. on premium Pro, really holiday outlook didn't EMEA share We're business. Yes, in We're was on gaming. to on records.

products. really think So streaming I fun lot those innovation then there. high a come AI and agents, And launched, ASP are that there's AI to just more we

can So bullish AID. about on and gaming, more we talk at it

Ananda Baruah

a in mentioned doing the it's your of I quick increased back into And conversations customers of whether appreciate or there be picking guess, that again. with bodies any to you're I of to well back context. coming follow-up, larger sort you context connecting would love guess had Are activity? up any office. office -- great. data would sort anecdotal the Any is VC I obviously getting you context about

Johanna Faber

Yes, we're new moving be seeing offices, continue hybrid. activity companies definitely to many office people into cetera, increased will because in setups, changing their et

few a office, at home. the in days few days a So

go decided all and all go the Some to to have office. in back

view teams sharing way are requires look that of perfect in products. of the a really is pretty And what offices perspectives look clear thinking what our All about great us. like. We've sharing of those great very being points new at and our damn for offices office, and effective like on technology those got which

support really on companies we're support days. that that place bullish decide week, go well we we can also And decide a to back companies again, X that on. So but fewer days another

Nate Melihercik

comes with from Our George Barclays. Wang next question

Dong Wang

quick have the ones. on quarter. I Congrats two

It's a control. refreshed give strong operating thoughts more maybe you the terms OpEx to can see nice Firstly, expense? in of

Just talked S&M sales of increase curious to more in to of if reinvest ratio. of things the to you XX% the just some about sales to a terms R&D previously, there's kind and guys tendency an XX%

curious versus that's reinvesting end if into the the to low Just of away move business? kind kind of

Matteo Anversa

not. Absolutely

So the you, let number dissect for George. me

invest So and sales R&D. to in and we -- the continue marketing. in

So spend that to job and debt drive with marketing and quarter, the that to our X% to posted. the being we very in did growth, if marketing one great just They very this you how book second, selectively spend reserve a The on team the numbers year-over-year. and forget money. was had some some up you e-tailers dollars in meticulous sales saw key about of the retailers results profitable we bad

the job So R&D. in for the to And same really a dollars spending team applies wisely. great the

of XX We before That's we And see you what gaming And with going holidays. net almost gaming We new do. achieved record launched what impact saw always just it. R&D that. look NPIs in right continue the to They you the up. of part did sales.

So that not is changing. philosophy

the quarter, we recorded As the we'll the XX% be excluding range, philosophy that to in debt the really range confirm not of far as bad XX%, that but the and the of we probably range, end is on changing. higher

cautiously, to R&D, and an marketing and invest to -- sales we in continue be We continue in drive to G&A. efficiency in

Dong Wang

can. I a follow-up, if quick Just

balance just bolt-on the cash a -- deals. $X.X sequentially, sheet in terms increased of billion of on bit since tuck-in Just reached guys cash you

are going of like So addressing kind kind such as do adjacencies category guys are BXB, versus a of more a you new down. doubling you to opportunities bit think cross-sell you

if Just refreshed there's thoughts any there. curious

Johanna Faber

Yes.

the touch on Day. we'll Investor at So definitely that

when priorities, look have though, we at pristine now, sheet. balance a you cap, our For

And priorities Our don't that is how the change. on cash spend great. situation we

critical all, of invested first we is in business. the So for R&D especially us.

Second, we prioritize increases the in every dividend nice dividends, year. the

The is though, M&A. third priority,

would I BXC work especially and and the in go-to-market. and M&A. with Any betting you're M&A that to of in So right. would were to a places deliberate if to really you're But in but up, deal. do glad synergies, woman, It's thoughtful much a say play and harder our be I BXB a or deal. be it strategic do I'm It's about great extremely we bringing easy have

if And tell you to trigger, are that and integrate be well. really we looking. the I we to also So it when we'll want ready pull

working So we're it's that another thing on.

be we in first $XXX share, for And usually buy around important. while we're know. new M&A, share have when to a million is quarter. We fourth meantime, our in not buybacks, the the really announcing any obviously back you'll something to But priority capital allocation

because again, it's back You've seen in. that million to because really buy believe the quarter, of but us also share good invest last $XXX cash a we situation, in

than a usual. was higher it So little

Nate Melihercik

At don't raised. anymore this hands time, we have

Matteo Anversa

Great. Hanneke, that's our last question today. for

Johanna Faber

you, thing Well, say performance Excellent. so the to our is last It's I'll Maybe quarter. see you great in joining. last thank proud team's you. this guys. Appreciate of am I just

us invest seen in and innovation, the you've our us capabilities You've and quarters. around over BXB strategically And do in our several product markets. seen global last that sensibly

capital line And it's is and on invested cash channels. returns. I what momentum in volatile that but across in XXXX. return to positioned on and as said, more seen excited come display be regained the healthy we're we this year, products, geographies that just perform generating, what's And the to be quarter. that We feel holiday not there will you've business really environment hopefully, global is could full for top the investment this well across across

to and Silicon in the here So we again, thank you hope Valley at March you see AID. all in

Logitech International (LOGI) 28 Jan 252025 Q3 Earnings call transcript