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Logitech International S.A. beat analyst expectations Monday with its latest quarterly earnings report, but Wall Street apparently saw things differently — the company's stock plunged 11.5% in trading Tuesday.
In its statement, which covers the company's third quarter for fiscal 2024, Logitech (Nasdaq: LOGI) said it had earnings of $244.7 million, providing a stock price profit of $1.55 per share. The company has dual headquarters in San Jose and Lausanne, Switzerland, with about a third of its approximately 8,200 employees based in the United States.
On Wall Street, the stock fell immediately after the markets opened down more than 11% for the day before regaining some ground in mid-day trading and then dropping to just about where it started by the end of the trading day. It closed at $84.86 s share.
Since the start of 2024, the stock is off nearly 9.4%. Over the past year, the company has performed well with investors, and is up nearly 47%. On Tuesday, the company lost $100 million in value, giving it a market capitalization of nearly $14.6 billion.
Heading into the third quarter earnings report, the average estimate of five analysts surveyed by Zacks Investment Research was for just $1.12 per share, according to a report in The Associated Press.
But Logitech saw its sales decline in December to $1.26 billion from $1.27 billion from the previous year. Here's the breakdown from the Q3 report:
- Sales were $1.26 billion, down 1% compared to the prior year (all numbers below are year-over-year comparisons).
- GAAP operating income was $222 million, up 26%. Non-GAAP operating income was $248 million, up 22%.
- GAAP earnings per share (EPS) was $1.55, up 80%. Non-GAAP EPS was $1.53, up 34%.
- For the quarter, the company returned $188 million of cash to shareholders through share repurchases.
Like most major tech hardware companies, Logitech has seen a slump in sales with inflation fears and confusion over "work from home" and hybrid strategies causing uncertainty in the market.
According to Reuters, Michael Foeth with the Swiss investment firm Vontobel wrote: "Logitech delivered better-than-expected results in the December quarter with sales down only 1% year-on-year, indicating that the post-pandemic normalisation is coming to an end and sales may start growing again in a couple of quarters."
Logitech CEO Hanneke Faber, who has been on the job less than two months, said that despite the computer hardware and peripherals manufacturer having "solid results in our third quarter ... we will not be satisfied until we return to top line growth."
Faber only recently joined Logitech on Dec. 1, having left his post as head of Unilever's nutrition business.
Companywide revenue
| Rank | Prior Rank | Business name/Prior rank |
|---|---|---|
1 | 1 | Apple Inc. |
2 | 2 | Alphabet Inc. |
3 | 3 | Chevron Corp. |