Logitech International S.A. (LOGI) delivered a solid performance in the second quarter of its fiscal year 2025, exceeding revenue expectations and surpassing analyst estimates for adjusted earnings per share. The company reported a 6% increase in revenue, reaching $1.116 billion, slightly topping the consensus forecast of $1.11 billion. This growth was driven by strong performance across key categories, with Video Collaboration rising by 5%, Gaming increasing by 7%, and Keyboards & Combos sales and Pointing Devices seeing gains of 8% and 2% respectively.
Logitech’s profitability also saw improvement, with adjusted gross margin expanding to 44.1% from 42.0% a year ago. Adjusted operating income grew by 5% to $193 million in the quarter. Notably, the company’s adjusted earnings per share (EPS) of $1.20 surpassed the consensus estimate of $0.99.
Further highlighting its financial strength, Logitech held over $1.36 billion in cash and equivalents as of September 30, generating $166 million in operating cash flow during the quarter. The company continued to return value to shareholders, repurchasing shares and distributing dividends totaling $340 million.
Looking ahead, Logitech raised its revenue guidance for fiscal year 2025, now anticipating a range of $4.39 billion to $4.47 billion, representing a 2% to 4% increase from its previous forecast of $4.34 billion to $4.43 billion. While this is an optimistic outlook, it falls short of the consensus estimate of $4.512 billion. The company also projected adjusted operating income in the range of $720 million to $750 million, an improvement from its previous guidance of $700 million to $730 million.
Despite the solid results and raised guidance, Logitech shares experienced a significant decline of 9.38% in after-hours trading, closing at $83.18. This downward movement is likely attributed to the company’s more conservative revenue outlook compared to analyst expectations. However, Logitech remains confident in its growth trajectory, with CEO Hanneke Faber stating, “Growth was broad-based, across regions, categories, and both our consumer and business customers. We launched a terrific set of innovations in the quarter and we are ready for the holidays.”
While the stock’s reaction might reflect a short-term market sentiment, Logitech’s strong financial performance and optimistic outlook suggest a positive outlook for the company in the long term.
