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Logitech (LOGI) Beats on Q3 Earnings, Raises FY21 Outlook

Logitech International LOGI reported third-quarter fiscal 2021 results, wherein both bottom and top lines surpassed estimates. Non-GAAP earnings came in at $2.45 per share, surpassing the Zacks Consensus Estimate by a whopping 126.9%. The bottom line also improved from the year-ago quarter’s earnings of 84 cents per share.

Net sales of $1.67 billion outpaced the consensus mark of $1.23 billion, and surged 85% year over year in dollars and 80% at constant currency.

Logitech has been benefiting from increased demand for its Video Collaboration tools, mainly driven by the rising work-from-home and learn-from-home trends. Also, the PC peripheral market is witnessing strong traction, which is aiding top-line growth. Additionally, demand for gaming products has shot up on the growing popularity of online video games and eSports amid the pandemic-led stay-at-home environment.

Segmental Details

Logitech’s Gaming segment sales soared 78% year over year to $436.4 million. Video Collaboration sales skyrocketed 218% year on year to $292.5 million. The Audio & Wearables segment sales jumped 87% year over year to $153 million.

Revenues from Pointing Devices increased 38% year over year to $213.6 million. Keyboards & Combos sales grew 40% to $218.3 million. Revenues from PC Webcams were up a whopping 309% to $131.7 million, while Tablet and Other Accessories sales surged 342% to $138.1 million.

However, Mobile Speakers’ sales fell 22% to $72.6 million. The Smart Home segment sales declined 33% year over year to $10.6 million. The Other segment revenues came in at $0.61 million during the fiscal third quarter.

Margins & Operating Metrics

Non-GAAP gross profit jumped more than two folds to $754.2 million from the year-ago quarter’s figure of $339.6 million. Non-GAAP gross margin expanded 760 basis points (bps) from the prior-year quarter to 45.2%.

Non-GAAP operating expenses flared up 47.8% to $277.9 million. Nonetheless, as a percentage of revenues, non-GAAP operating expenses decreased to 16.7% from the year-ago quarter’s figure of 20.8%.

Non-GAAP operating income soared more than three-fold to $476.3 million from the $151.6 million reported in the year-ago quarter. Operating margin advanced 11.8 percentage points to 28.6%.


As of Dec 31, 2020, Logitech’s cash and cash equivalents were $1.39 billion compared with the $917.2 million recorded in the previous quarter.

Additionally, the company generated operating cash flow of $529.9 million during the fiscal third quarter. During the first nine months of fiscal 2021, the company generated $928.4 million.


Logitech has raised its view for fiscal 2021. The company now expects non-GAAP operating income of $1.05 billion compared with the previously-guided range of $700-$725 million.

Revenues in the fiscal year are now anticipated to be up 57-60% year on year at constant currency, instead of the earlier forecast of a 35-40% increase.

Zacks Rank and Stocks to Consider

Logitech currently carries a Zacks Rank #3 (Hold).

Better-ranked stocks in the broader technology sector include CEVA, Inc. CEVA, Micron MU and NetApp NTAP, all sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The long-term earnings growth rate for CEVA, Micron and NetApp is currently pegged at 20%, 12.7% and 11.9%, respectively.

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