Slide 1: Q2 Fiscal Year 2018 Financial Results
logitec Q2 Fiscal Year 2018 Financial Results Lausanne, October 24, 2017
Slide 2: Forward-looking statements
This presentation includes forward-looking statements within the meaning of the U.S. federal securities laws, including, without limitation, statements regarding: our preliminary financial results for the three and six months ended September 30, 2017, performance and areas of improvement, strategy,
Slide 3: Key Messages - Q2 FY2018
KEY MESSAGES —- Q2 FY2018 Consistent growth continues, with sales up 11% (CC) to $634M Video Collaboration and Gaming sales increased 59% (CC) and 42% (CC), respectively Gross margins remained very healthy at 36.6% and reflected our go-to-market investments to support numerous product introductions
Slide 4: What's New from Logitech
WHAT’S NEW FROM LOGITECH
Slide 5: Mobile Speakers
MOBILE SPEAKERS ULTIMATE EARS MEGABLAST and BLAST expand our product line-up with portable speakers integrated with Alexa voice control Comes with Wi-Fi, Bluetooth, and far- field mics so you can listen at home or on the go Waterproof, dustproof and with long- lasting battery life ULTIMATE EARS POWE
Slide 6: Jaybird
JAYBIRD JAYBIRD RUN is a truly wireless earbud designed for athletes Delivers a secure, run-specific comfort-fit that is sweat-proof and water resistant Offers four hours of battery life ona single charge, while the pocket-sized charging case provides an additional eight hours A quick, five-minute c
Slide 7: Keyboards & Combos
KEYBOARDS & COMBOS LOGITECH CRAFT is our flagship advanced keyboard with a creative input dial, called the Crown The Crown offers context and app-specific functions with just a touch, tap or turn of the dial Features smart illumination with backlighting that automatically detects your hands and room
Slide 8: Pointing Devices
POINTING DEVICES LOGITECH MX ERGO is our newest, innovative trackball Offers personalized comfort with a unique adjustable hinge (from 0 to 20°, improving wrist posture and pronation) Reduces muscle strain by 20% compared to using a standard mouse Enabled with Easy-Switch and Flow, allowing you to c
Slide 9: PC Speakers
PC SPEAKERS LOGITECH MX SOUNDis a premium Bluetooth desktop speaker with superior sound in a stylish design Features motion-activated backlit controls to easily adjust volume and simple Bluetooth device pairing Built with 24-watt peak power, high-end drivers, and rear-facing port tubes that delivers
Slide 10: Gaming
GAMING LOGITECH G613 is our first wireless, high-performance gaming keyboard Features our most advanced LIGHTSPEED wireless technology to deliver professional-grade wireless performance and reliability Up to 18 months of gaming on two AA batteries Includes six programmable macro keys and our exclusi
Slide 11: Gaming
GAMING ASTRO A20 broadens our line-up of console gaming headsets Compatible with PlayStation 4, Xbox One family, Windows 10 PCs, and Mac iOS Engineered for extended gaming sessions, featuring comfortable and lightweight cloth ear cushions Includes a uni-directional mic with Flip- to-Mute functionali
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Slide 13: Q2 FY2018 Results Demonstrate Sustainability
Q2 FY2018 RESULTS DEMONSTRATE SUSTAINABILITY cosa | 5564 YoY % chg 12% 9% YoY % chg (CC) 1% 9% Gross profit 232 209 1% % margin 36.6% 37.0% (40bp) Operating expense 159 144 1% % of sales 25.1% 25.5% (40bp) % margin 11.4% 11.5% (10bp) Net income 67 58 16% % margin 10.6% 10.3% 30bp Earnings per share
Slide 14: Consistent Growth Trends Continue
CONSISTENT GROWTH TRENDS CONTINUE Pointing Devices Keyboards & Combos 119 PC Webcams 28 Tablet & Accessories 31 Video Collaboration 46 Mobile Speakers 1 Audio PC & Wearables 63 Gaming 114 Smart Home Note: Net sales in § millions. Results are non-GAAP. Comparisons are YoY unless otherwise specified 1
Slide 15: Regional Sales YoY% CC
Regional Sales YoY% CC 30% 22% 23% 23% 20% 19% 17% 14% 13% 11% 11% 11% 10% 11% 8% 7% 8% 5% Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18
Slide 16: Non-GAAP Gross Margin
Non-GAAP Gross Margin 40.0% 39.2% (1) 39.0% 38.0% 37.4% 37.0% 37.0% 36.6% 37.0% 35.6% 36.0% 35.0% 34.0% 33.0% 32.0% 31.0% 30.0% Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18
Slide 17: Opex Investments to Support Growth
OPEX INVESTMENTS TO SUPPORT GROWTH j 9 remained at targeted range of 25% Sales & marketing 14% of sales % of sales 16.2% 16.0% 20bp Research & development 35 32 10% Continuing to drive G&A-to-sales % of sales Ao Bloke (10bp) ratio lower through higher sales leverage General & administrative 21 22 (1
Slide 18: Working Capital in Line with Seasonality
WORKING CAPITAL IN LINE WITH SEASONALITY in line with seasonal trends and a) . Cash from operations tracking to full-year target of 1x non- Ending cash balance ) 406 395 10 GAAP operating income Inventory 330 268 62 Inventory turns 4.9 5.3 (0.4 turns) More than half of the increase in inventory is f
Slide 19: Fiscal Year 2018 Outlook
FISCAL YEAR 2018 OUTLOOK FY2018 OUTLOOK Sales CC growth Up 10-12% Non-GAAP operating income $260 - 270M ASSUMPTIONS Currency Approximately FY17 average rates Non-GAAP effective tax rate ~8-9% Cash from operations ~1x non-GAAP operating income Capex ~$50M
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Slide 21: GAAP to Non-GAAP Reconciliations
GAAP TO NON-GAAP RECONCILIATIONS PRELIMINARY RESULTS * (In thousands, except per share amounts) - Unaudited GAAP TO NON-GAAP RECONCILIATION “®) Three Months Ended Six Months Ended September 30, September 30, SUPPLEMENTAL FINANCIAL INFORMATION 2017 2016 2017 2016 Gross profit - GAAP $ 228,732 $ 206,8
Slide 22: GAAP to Non-GAAP Reconciliations
GAAP TO NON-GAAP RECONCILIATIONS PRELIMINARY RESULTS * (In thousands, except per share amounts) - Unaudited GAAP TO NON-GAAP RECONCILIATION “”°) Three Months Ended ‘Six Months Ended September 30, September 30, SUPPLEMENTAL FINANCIAL INFORMATION 2017 2016 2017 2016 ‘Operating income - GAAP $ 59933 $
Slide 23: GAAP to Non-GAAP Reconciliation Notes
GAAP TO NON-GAAP RECONCILIATION NOTES * Note: These preliminary results for the three and six months ended September 30, 2017 are subject to adjustments, including potential adjustments, which we currently estimate not to be material, as we continue to verify information provided by a new third-part
Slide 24: GAAP to Non-GAAP Reconciliation Notes
GAAP TO NON-GAAP RECONCILIATION NOTES (B) Non-GAAP Financial Measures To supplement our condensed consolidated financial results prepared in accordance with GAAP, we use a number of financial measures, both GAAP and non-GAAP, in analyzing and assessing our overall business performance, for making op
Slide 25: Sell-Through Data
SELL-THROUGH DATA Measures sales of our products by retailer customers to consumers and by our distributor customers to their customers Compiled by Logitech from data supplied by our customers Customers supplying sell-through data vary by geographic region and from period to period, but typically re
Slide 26: Logitech
logitech