Logitech Q3 Earnings Beat: Can Strong Guidance Lift the Stock?

Core Insights - Logitech International S.A. reported strong third-quarter fiscal 2025 results, with both revenue and earnings exceeding expectations [1][2][3] Financial Performance - Non-GAAP earnings per share for the third quarter were $1.59, beating the Zacks Consensus Estimate by 15.2% and reflecting a 4% year-over-year increase [2] - Revenues reached $1.34 billion, surpassing the consensus mark by 7.7%, with a 7% increase on a reported basis and a 6% increase on a constant currency basis compared to the prior year [3] Segment Performance - Key product categories showed sales growth, with notable increases in: - Keyboards & Combos: up 3% to $236.75 million [6] - Gaming: up 14% to $466.72 million [6] - Headsets: up 10% to $45.9 million [7] - Pointing Devices: up 5% to $217 million [7] - Tablet Accessories: up 21% to $77.4 million [7] - Video Collaboration: up 4% to $176 million [7] - Declines were noted in: - Webcams: down 2% to $84.4 million [8] - Other category: down 27% to $36 million [8] Margins and Operating Metrics - Non-GAAP gross profit increased by 9% to $579 million, with gross margin expanding by 90 basis points to 43.2% [9] - Non-GAAP operating income grew 7.1% to $265.9 million, maintaining an operating margin of 19.8% [10] Liquidity and Shareholder Return - As of December 31, 2024, cash and cash equivalents were $1.5 billion, up from $1.36 billion in the previous quarter [11] - The company returned $200 million to shareholders through share repurchase in the fiscal third quarter [11] Guidance Update - Logitech raised its fiscal 2025 sales guidance to a range of $4.54-$4.57 billion, reflecting a year-over-year increase of 5.4-6.4% [12] - Non-GAAP operating profit guidance was also raised to a range of $755-$770 million, indicating year-over-year growth of 8-10% [13]