Logitech International SA (NASDAQ: LOGI) said on Thursday quarterly operating profit fell 34% on steep currency declines and shrinking demand for accessories like the computer mouse on which it built its global brand name.
Nonetheless, strong demand for newer music and video accessories helped profits to come in higher than all analyst forecasts.
Logitech has refocused on new lines like wireless music speakers, videoconferencing and video game controllers, offsetting a decline in personal computers and demand for the mice and keyboards it has made since the dawn of the PC age.
Towards that end, Logitech said it will exit a low-margin business that mainly makes computer mice for PC makers to sell as their own. Sales there fell 26%in the latest quarter.
It reported operating profit of $14.5 million U.S. for the quarter ended March 31, compared to $21.8 million U.S. a year ago, due to pockets of sales strength, lower costs and fewer restructuring charges. Net sales in the March quarter fell 4.7% to $467.2 million U.S., at the high of estimates.
Logitech has at best managed slow sales growth for six of the past seven years. However, underlying demand for new products and action to cut costs and raise prices are positioning it for sustained growth in coming years, it said.
Shares in the Swiss-based company traded up 77 cents, or 5.3%, in New York this morning to $15.17 U.S., in the upper end of a 52-week trading range of $11.20 U.S. to $15.52 U.S.
