by Anton Shilov
01/24/2013 | 11:58 PM
After posting another consecutive loss for the quarter, Logitech International, a leading manufacturer of computer peripherals and various accessories, announced plans to reshape the company. The restructuring will include divestment of numerous product categories, including accessories for video game systems, remote controls and security appliances, and concentration on traditional PC peripherals as well as accesories for mobile devices.
“As we articulated when we started the third quarter, continued weakness in the global PC market was the primary factor in our disappointing Q3 results. These results are unacceptable and we are taking decisive action as an outcome of my strategic review,” said Bracken P. Darrell, president and chief executive officer of Logitech.
Logitech’s sales for Q3 of fiscal 2013 were $615 million, down 14% from $715 million in Q3 FY2012. The company posted an operating loss of $180 million, which included a non-cash video conferencing business unit-related goodwill impairment charge, estimated to be $211 million. Net loss for Q3 FY 2013 was $195 million ($1.24 per share) compared to net income of $55 million ($0.32 per share) in Q3 FY 2012. Gross margin for the quarter was 34.2%, compared to 36.2% in the same quarter one year ago.
In a bid to improve the company’s revenue and profits, Logitech will put more attention in creating competitive accessories for media tablets and smartphones. The company will also make its best to sustain its leading position on the market of PC peripherals, such as keyboards, mice, webcams, speakers, etc. In order to focus resources around strategic products, Logitech will discontinue remote controls, security cameras, speaker docks and video game console peripherals.
“We are taking immediate actions to shape a faster and more profitable Logitech. We are developing more mobility-related products, leveraging the powerful growth of tablets and smartphones. We intend to sustain our leadership in PC platform-related products where we have engineering, distribution and scale advantages. […] We have also identified a number of product categories that no longer fit with our current strategic direction. As a result, we have initiated the process to divest our remote controls and digital video security categories, and we plan to discontinue other non-strategic products, such as speaker docks and console gaming peripherals, by the end of calendar 2013,” said Mr. Darrel.