Logitech posts an eleventh straight quarter of growth, but a chip supplier's factory incident will cut holiday sales
The Lausanne-based maker of mice, keyboards and video conferencing gear beat expectations and returned $406m to shareholders. A semiconductor supplier's plant closure will weigh on the holiday quarter.
Logitech International, the Swiss maker of computer peripherals, gaming gear and video conferencing equipment, reported sales of $1.22 billion for the second quarter of its 2027 financial year, up 3% in US dollars. The company announced the results late on Tuesday 27 October and said it was its eleventh consecutive quarter of growth.
Its outlook for the holiday quarter includes an estimated $70 million to $80 million hit to sales from a serious incident at one of its semiconductor suppliers. Investor's Business Daily reported that Logitech beat estimates and guided above analysts' sales views, but its stock fell in extended trading.
The quarter
According to Logitech's release, sales in the three months to 30 September were $1,219 million, against $1,186 million a year earlier. That is growth of 3% in US dollars and 2% in constant currency. GAAP operating income rose 5% to $201 million and GAAP earnings per share rose 9% to $1.25.
On an adjusted (non-GAAP) basis, operating income was $231 million, almost flat on the year, and earnings per share were $1.51, up 4%. Margins were the strongest part of the report. The GAAP gross margin rose 150 basis points to 44.9%, and chief financial officer Matteo Anversa said non-GAAP operating income was "well ahead of our outlook".
Product lines
Gaming remained Logitech's largest category, with sales of $349 million against $323 million a year earlier. Pointing devices such as mice grew to $230 million from $221 million, and headsets rose to $46 million from $43 million. Tablet accessories were the weak spot, falling 32% to $58 million.
"We delivered our eleventh consecutive quarter of growth and launched 19 new products for the holiday quarter," said chief executive Hanneke Faber. "Growth in the Americas, Video Collaboration and Gaming supported our topline growth."
The supplier problem
The main concern is the holiday quarter. Logitech said one of its semiconductor suppliers had a serious incident at its manufacturing facility, which led to the plant's closure at the end of June. The facility reopened in September and is ramping up, but its capacity is still below what Logitech needs. The company expects it to return to full production by the end of the calendar year.
For the third financial quarter, which covers October to December, Logitech expects sales of $1,360 million to $1,430 million. That is a change of minus 4% to plus 1% in US dollars, or minus 5% to 0% in constant currency. The range includes the estimated $70 million to $80 million impact from the supplier incident, which Logitech expects to be largely resolved by its fourth quarter. It forecasts non-GAAP operating income of $220 million to $255 million.
Logitech did not name the supplier in its release. Investor's Business Daily reported that the sales guidance was nevertheless above analysts' expectations, but that the shares fell in extended trading after the report.
Cash returns
Logitech returned $406 million to shareholders in the quarter. That included its annual dividend of $235 million and $171 million of share repurchases. Cash flow from operations was $164 million, and the company ended the quarter with cash of $1.51 billion.
What it means for European founders and investors
Logitech, founded in Switzerland in 1981 and listed on both the SIX Swiss Exchange and Nasdaq, is one of Europe's best-known consumer hardware companies. Its report shows how a single point of failure in the supply chain can hurt even a large, well-run company. A plant closure at one chip supplier in June is still expected to remove up to $80 million of sales six months later, in the most important quarter of the year.
For hardware startups, the lesson is practical. Second sources for critical components, safety stock before peak season and clear communication with customers matter as much as product design. The same theme came up the same evening at Dutch chipmaker NXP, which said lead times for its chips are lengthening; Europreneurs Media covers that in NXP's third-quarter results.
The quarter also shows where demand is moving. Gaming and video collaboration are growing, while tablet accessories are shrinking. For founders building products for hybrid work or gaming, that is a sign the market is still healthy. For investors, Logitech's ability to grow margins while sales rise only modestly shows the value of pricing power and cost discipline. More European business news is on our Europe page and in our analysis of the German business climate.
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