Computer parts maker Logitech raises full-year guidance

By John Revill

(Reuters) -Logitech International lifted its full-year guidance on Tuesday after the computer keyboard and webcam maker increased profit and slowed the rate of its sales downturn during its second quarter ended Sept. 30.

The Swiss-American company, which experienced a strong pandemic as people stocked up on its equipment to work from home, added it was closer to finding a new CEO after Bracken Darrell left in June to take charge of Vans sneaker maker VF Corp (NYSE:).

Both developments are likely to boost the company, whose chairperson Wendy Becker came under fire from co-founder Daniel Borel last month.

The company’s stock, which closed Monday at 61.9 Swiss francs, was indicated to rise 8.2% in premarket activity on the Zurich stock exchange.

“We made great progress toward a return to growth and exceeded our pre-pandemic profit levels,” said Interim CEO Guy Gecht.

In the three months to Sept. 30, Logitech (NASDAQ:) continued its sales fall as it lapped high comparisons during the pandemic years. However, the 8% drop in the second quarter to $1.06 billion was half the rate of the previous quarter’s 16% fall in sales.

This meant sales during the company’s first half fell 12% – better than the 19%-14% fall Logitech had been expecting.

Meanwhile, profit rose as Logitech continued to cut costs by reducing spending on logistics and promotions.

Non-GAAP operating income in the second quarter rose 17% to $183 million, pushing the half-year figure to $292 million – better than the $180 to $220 million Logitech forecast.

As a result, Logitech, which also makes mobile speakers, headsets and computer mice, lifted its full-year sales and profit outlook.

It now expects full-year sales of $4 billion to 4.15 billion, up from its previous view of $3.8 billion to $4 billion.

Full-year non-GAAP operating income is also expected to be higher than its earlier forecast, at $525 million to $575 million, Logitech said.

After the results Bank Vontobel raised its target price to 77 francs from 71, saying Logitech “continues to execute with high precision on a proven and strong business model and financial model.”