LOGITECH INTERNATIONAL SA
For the period ended Jun 30, 2024. Filed Jul 25, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Jul 25, 2024
LOGI$96.25-2.0%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2023-12-31; filed 2024-01-25.
0001032975-24-000008
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-07-25.
0001032975-24-000046
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 172 previous paragraphs and 172 current paragraphs.
95 unchanged; 61 reworded; 14 added; 15 removed; 1 previous and 2 current paragraphs rearranged.
Tables are not compared: 10 previous and 10 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (14)
Current report
Company Overview
Current report
•Gaming: The ongoing growth and evolution of gaming creates an opportunity for us to provide more tools to a wider community of gamers. In particular, social gaming continues to gain popularity through online gaming, multi-platform experiences and esports.
Current report
•Climate change: Climate change affects everyone. We already consider sustainability as part of our product design and in other areas and intend to continue to do so in the future.
Current report
•The importance of trust: With our well-established Logitech brand, consumer-centric design philosophy, and commitment to high privacy and security standards, we strive to deliver trusted user experiences.
Current report
Our total sales for the three months ended June 30, 2024 increased 12%, compared to the three months ended June 30, 2023, primarily due to an increase in sales for Gaming, Keyboards & Combos and Pointing Devices, driven by improved demand.
Current report
Sales for the three months ended June 30, 2024 increased 20%, 9%, and 8% in EMEA, the Americas, and Asia Pacific regions, respectively, compared to the three months ended June 30, 2023.
Current report
Operating expenses for the three months ended June 30, 2024 were $312.8 million, or 28.7% of sales, compared to $297.2 million, or 30.5% of sales, for the three months ended June 30, 2023. The increase in operating expense was primarily driven by an increase in marketing and advertising spend.
Current report
Sales by product category for the three months ended June 30, 2024 and 2023 were as follows (dollars in thousands):
Current report
Sales of Gaming increased 16%for thethree months ended June 30, 2024, compared to thethree months ended June 30, 2023, primarily driven by an increase in sales of gaming mice and gaming steering wheels.
Current report
Sales of Headsets increased 20% for the three months ended June 30, 2024, compared to the three months ended June 30, 2023, primarily driven by an increase in sales of corded and cordless PC headsets and VC headsets.
Current report
Sales in Other category remained flat for thethree months ended June 30, 2024, compared to thethree months ended June 30, 2023.
Current report
The BEPS Project undertaken by the OECD recommended changes to numerous long-standing tax principles, including a proposal to reallocate profits among tax jurisdictions in which companies do business (“Pillar One”) and establishing a minimum tax on global income (“Pillar Two”). Some jurisdictions, including Switzerland, where we operate are implementing Pillar Two laws to effectuate a 15% minimum tax. The minimum tax effective beginning in fiscal year 2025 for the Company, is treated as a current cost and does not have a material impact on the Company's effective tax rate. The OECD and participating countries continue to issue underlying rules and administrative guidance related to Pillar Two, and we continue to monitor the relevant developments.
Current report
We file Swiss and foreign tax returns. We received final tax assessments in Switzerland through fiscal year 2019. For other material foreign jurisdictions such as the United States, we are generally not subject to tax examinations for years prior to fiscal year 2020 and calendar year 2020, respectively. In the United States, the federal and state tax agencies have the authority to examine periods prior to fiscal year 2020, to the extent allowed by law, where tax attributes were generated, carried forward, and being utilized in subsequent years. We are under examination in foreign tax jurisdictions. If the examinations are resolved unfavorably, there is a possibility that they may have a material negative impact on our results of operations.
Current report
For the three months ended June 30, 2024, the effect of exchange rate changes on cash and cash equivalents is not material.
Removed paragraphs (15)
Previous report
Overview of Our Company
Previous report
Our total sales for the three and nine months ended December 31, 2023 decreased 1% and 8%, compared to the three and nine months ended December 31, 2022, respectively, driven by a decline in sales of most of our product categories, as a result of lower demand.
Previous report
Sales for the three months ended December 31, 2023 increased 5% in the Americas region, and decreased 8% and 3% in the Asia Pacific and EMEA regions, respectively, compared to the three months ended December 31, 2022. Sales for the nine months ended December 31, 2023 decreased 19%, 4%, and 3% in the Asia Pacific, Americas, and EMEA regions, respectively, compared to the nine months ended December 31, 2022.
Previous report
During the first quarter of fiscal year 2024, we changed the presentation of sales by product category to provide a simpler and clearer view of our business. The change in presentation did not have an impact on previously reported total sales. As a result of these changes, certain prior-period amounts for the three and nine months ended December 31, 2022 have been reclassified to conform to the current period presentation. See Note 1 to the condensed consolidated financial statements for further information on the change in presentation.
Previous report
Sales by product category in the current presentation for the three and nine months ended December 31, 2023 and 2022 were as follows (dollars in thousands):
Previous report
Sales of Gaming decreased 1%for thethree months ended December 31, 2023, compared to thethree months ended December 31, 2022, primarily driven by a decrease in sales of gaming keyboards and gaming mice, partially offset by an increase in sales of gaming mouse pads. Sales of Gaming decreased 7%for the nine months ended December 31, 2023, compared to thenine months ended December 31, 2022, primarily driven by a decrease in sales of gaming steering wheels, gaming keyboards and gaming mice, partially offset by an increase in sales of gaming mouse pads.
Previous report
Sales of Headsets decreased 11% and 10% for the three and nine months ended December 31, 2023, compared to the three and nine months ended December 31, 2022, respectively, primarily driven by a decrease in sales of VC headsets and corded PC headsets.
Previous report
Sales in Other category decreased 16% and 28% for thethree and nine months ended December 31, 2023, compared to thethree and nine months ended December 31, 2022, respectively, primarily driven by a decrease in sales of mobile speakers.
Previous report
Operating expenses for the three and nine months ended December 31, 2023 and 2022 were as follows (dollars in thousands):
Previous report
Research and development expenses as a percentage of sales increased from 5.2% and 5.9% in the three and nine months ended December 31, 2022, respectively, to 5.8% and 6.4% in the three and nine months ended December 31, 2023, respectively, reflecting our continued investment in innovation.
Previous report
The canton of Vaud completed the legislative process to enact TRAF, a reform to better align the Swiss tax system to international tax standards, on March 10, 2020 to take effect as of January 1, 2020. In March 2020, we reached an agreement with the Vaud Tax Administration that would allow for an increase in the tax basis of goodwill, as a transition measure under TRAF, to be amortized over ten years beginning on January 1, 2020. During the three months ended December 31, 2023, we reached an agreement to remeasure the tax basis of goodwill under TRAF with the canton of Vaud, which resulted in an income tax benefit of $25.1 million, net of assessment of uncertain tax positions. The remeasurement of the step-up will be amortized over the remaining ten-year amortization period.
Previous report
On December 29, 2023, a change to the cantonal tax legislation was published. According to the law approved by the Vaud parliament, a progressive scale will be applicable for cantonal tax purposes resulting in an increase from the current tax rate of 13.61% to 14.28% effective fiscal year 2025. The increase in tax rate resulted in a tax benefit of $5.1 million due to a remeasurement of our Swiss deferred tax assets in the fiscal quarter ended December 31, 2023.
Previous report
The Tax Cuts and Jobs Act enacted Section 250, which provides for a deduction with respect to Global Intangible Low-Taxed Income ("GILTI") and FDII in the US. The application of this tax incentive is inherently complex. During the three months ended December 31, 2023, we analyzed the applicability of FDII and determined that this tax incentive applies to fiscal 2021 to 2023 tax years. As a result, we realized a tax benefit of $17.9 million related to FDII. We have also concluded that any GILTI tax since the enactment of Tax Cuts and Jobs Act would be immaterial.
Previous report
For the nine months ended December 31, 2023, there was a $4.1 million loss from currency exchange rate effect on cash and cash equivalents, primarily due to exchange rate fluctuations of Swiss Franc, Chinese Renminbi, and Euro versus the U.S. Dollar, and timing of our cash transactions over the period. The loss from currency translation exchange rate effect during the nine months ended December 31, 2022 was primarily due to exchange rate fluctuations of Euro, Swiss Franc, Chinese Renminbi, and Australian Dollar versus the U.S. Dollar and timing of our cash transactions over the period.
Previous report
In May 2020, our Board of Directors approved the 2020 share repurchase program, which authorized us to invest up to $250.0 million to purchase our own shares to support equity incentive plans or potential acquisitions. In April 2021, our Board of Directors approved an increase of $750.0 million to the 2020 share repurchase program, to an aggregate amount of $1.0 billion. The Swiss Takeover Board approved this increase and it became effective on May 21, 2021. In July 2022, our Board of Directors approved an increase of $500 million to the 2020 share repurchase program to an aggregate amount of up to $1.5 billion. The Swiss Takeover Board approved this increase and it became effective on August 19, 2022. The 2020 share repurchase program expired on July 27, 2023. We repurchased 16.7 million shares for an aggregate cost of $1.2 billion under the 2020 share repurchase program, of which 2.6 million shares for an aggregate cost of $159.1 million were repurchased during fiscal year 2024 prior to the expiration of the program.
Reworded paragraphs (61)
Previous wording
•Our business strategy and investment priorities in relation to competitive offerings and evolving consumer demand trends affecting our products and markets, current and future worldwide geopolitical, economic and capital market conditions, including fluctuations in currency exchange rates, inflation, economic downturns, and disruptions in global transportation lines;
Current wording
•Our business strategy and investment priorities in relation to competitive offerings and evolving consumer demand trends affecting our products and markets, current and future worldwide geopolitical, economic and capital market conditions, including fluctuations in currency exchange rates, changes in fiscal policies, inflation, economic downturns, and disruptions in global logistics;
Previous wording
•Our expectations regarding our restructuring efforts, including the timing thereof;
Current wording
•Our expectations regarding any restructuring efforts, including the timing thereof;
Previous wording
Forward-looking statements also include, among others, those statements including the words “anticipate,” “believe,” “could,” “estimate,” “expect,” “forecast,” “intend,” “may,” “plan,” “project,” “predict,” “should,” “will,” and similar language. These statements reflect our views and assumptions as of the date of this Quarterly Report on Form 10-Q. All forward-looking statements involve risks and uncertainties that could cause our actual performance to differ materially from those anticipated in the forward-looking statements depending on a variety of factors. Important information as to these factors can be found in this Quarterly Report on Form 10-Q under the headings of “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Overview of our Company,” “Critical Accounting Estimates,” and “Liquidity and Capital Resources,” among others. Factors that might cause or contribute to such differences include, but are not limited to, those discussed under Part II, Item 1A “Risk Factors” as well as elsewhere in this Quarterly Report on Form 10-Q and in our other filings with the U.S. Securities and Exchange Commission, or “SEC.” You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this Quarterly Report on Form 10-Q. We undertake no obligation to publicly release any revisions to the forward-looking statements or reflect events or circumstances after the date of this document.
Current wording
Forward-looking statements also include, among others, those statements including the words “anticipate,” “believe,” “could,” “estimate,” “expect,” “forecast,” “intend,” “may,” “plan,” “project,” “predict,” “should,” “will,” and similar language. These statements reflect our views and assumptions as of the date of this Quarterly Report on Form 10-Q. All forward-looking statements involve risks and uncertainties that could cause our actual performance to differ materially from those anticipated in the forward-looking statements depending on a variety of factors. Important information as to these factors can be found in this Quarterly Report on Form 10-Q under the headings of “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Company Overview,” “Critical Accounting Estimates,” and “Liquidity and Capital Resources,” among others. Factors that might cause or contribute to such differences include, but are not limited to, those discussed under Part II, Item 1A “Risk Factors” as well as elsewhere in this Quarterly Report on Form 10-Q, in our Annual Report on Form 10-K for the year ended March 31, 2024, and in our other filings with the U.S. Securities and Exchange Commission, or “SEC.” You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this Quarterly Report on Form 10-Q. We undertake no obligation to publicly release any revisions to the forward-looking statements or reflect events or circumstances after the date of this document.
Previous wording
Logitech’s mission is to help all people pursue their passions in a way that is good for people and the planet. We design, manufacture, and sell products that help businesses thrive and bring people together when working, creating, gaming and streaming. We sell these products through a number of brands: Logitech, Logitech G, Streamlabs and Ultimate Ears.
Current wording
Logitech designs software-enabled hardware solutions that help businesses thrive and bring people together when working, creating, gaming and streaming. As a point of connection between people and the digital world, our mission is to extend human potential in work and play, in a way that is good for people and the planet. We sell these products through a number of brands, including Logitech, Logitech G and others.
Previous wording
Our diverse portfolio includes Gaming, Keyboards & Combos, Pointing Devices, Video Collaboration, Webcams, Tablet Accessories, and Headsets. We sell our products to a broad network of international customers, including direct sales to retailers, e-tailers, and end consumers through our e-commerce platform, and indirect sales to end customers through distributors.
Current wording
We sell our products to a broad network of international customers in the Americas, Europe, the Middle East and Africa (“EMEA”) and Asia Pacific. This includes direct sales to retailers, e-tailers, and end consumers through our e-commerce platform, and indirect sales to end customers through distributors.
Previous wording
Our business has been impacted by adverse macroeconomic and geopolitical conditions. These conditions include inflation, interest rate and foreign currency fluctuations, slowdown of economic activity around the world, and lower consumer and enterprise spending.
Current wording
Our business has continued to be impacted by macroeconomic and geopolitical conditions. These conditions include inflation, interest rate and foreign currency fluctuations, changes in fiscal policies, low economic growth in certain regions, and uncertainty in consumer and enterprise demand.
Previous wording
The global and regional economic and political conditions adversely affected demand for our products. In addition, these conditions, including recent transportation issues in the Red Sea, have caused and may continue to cause volatility in the cost of materials and logistics, and transportation delays, and as a result may impact the pricing of our products, product availability and our results of operations.
Current wording
The global and regional economic and political conditions have caused and may continue to cause volatility in demand for our products as well as cost of materials and logistics, and transportation delays, and as a result may impact the pricing of our products, product availability and our results of operations.
Previous wording
Several long-term secular-trends offer long-term structural growth opportunities across Logitech’s product portfolio, including work and learn from anywhere (hybrid work and learn), video everywhere, the rise of social gaming for participants and spectators, and the democratization of digital content creation. We design, create and sell products that benefit from these secular trends. The trend of hybrid work and learn provides an opportunity to equip meeting rooms, classrooms and personal workspaces, at home or in the office. It also provides an opportunity for increased commercial and consumer adoption of video conferencing. Our video collaboration products are compatible with a variety of video conference platforms, including Zoom, Microsoft Teams, Google Meet, etc. Moving from work to play, Logitech gaming and streaming products benefit from social gaming which continues to gain popularity through online gaming, multi-platform experiences and esports. In addition, the democratization of digital content creation presents an opportunity for anyone to be a content creator because of the accessibility of the tools necessary to code, design, create, make music, game or broadcast to professional standards.
Current wording
Several long-term secular-trends offer long-term structural growth opportunities across Logitech’s product portfolio. We design, create and sell products that benefit from these secular trends which include the following:
Previous wording
The rapid evolution and adoption of generative artificial intelligence indicates that how we collaborate, communicate, play and create across industries and professions will change, perhaps dramatically, over the next few years. AI has reshaped expectations for productivity improvements, product innovation and technology ecosystem evolution. While we have used AI solutions and machine learning to enhance the features of different products in our portfolio, AI offers additional growth opportunities and risks as we work to integrate our capabilities with our ecosystem partners. Ultimately our customers might begin to integrate AI into their workflows for productivity, play, learning and creativity. We believe that the shift to AI will transform the consumer electronics industry, leading to changes including more intelligent and personalized products, enhanced customer experiences, and increased competition among companies to leverage AI capabilities for innovation and growth.
Current wording
•AI: AI has reshaped expectations for productivity improvements, product innovation and technology ecosystem evolution. While we have used AI solutions and machine learning to enhance the features of different products in our portfolio, AI offers additional growth opportunities and risks as we work to integrate our capabilities with our ecosystem partners.
Previous wording
While we believe we will further benefit from these secular trends, we have experienced and will continue to experience challenges that impact our business and financial results. These challenges include (i) the current macroeconomic environment, including interest rate fluctuations, inflation, foreign exchange movements and low economic growth in certain regions, (ii) low consumer confidence and declines in enterprise spending leading to reduced demand for some of our products, (iii) the uncertainty with enterprise strategy for office space utilization and related timing of enterprise investments in infrastructure and technology to support future ways of working, which impacts demand for our Video Collaboration and other products, and (iv) the timing of further development of our business-to-business go-to-market capabilities.
Current wording
While we believe we will further benefit from these secular trends, we have experienced and will continue to experience challenges that impact our business and financial results. These challenges include (i) the current macroeconomic environment, including interest rate fluctuations, inflation, foreign exchange movements, changes in fiscal policies and low economic growth in certain regions, (ii) the uncertainty with overall consumer and enterprise demand, (iii) the uncertainty with enterprise strategy for office space utilization and related timing of enterprise investments in infrastructure and technology, and (iv) the timing of further development of our B2B go-to-market capabilities.
Previous wording
We expect these challenges to continue in the near-term. We have taken steps to mitigate the impact of these challenges, including but not limited to: (i) reduction in our operating expenses in order to maintain margins and size the business for the current market, (ii) reduction in inventories to more appropriately align with demand, (iii) continued investment in our business-to-business direct sales channel in order to improve performance, and (iv) release of new products to increase the value proposition of our portfolio.
Current wording
We expect these challenges to continue in the near-term. We have taken steps to mitigate the impact of these challenges, including but not limited to: (i) maintaining discipline in our operating expenses, (ii) managing inventory levels to align with demand, (iii) continued investment in our B2B capabilities, and (iv) release of new products to increase the value proposition of our portfolio.
Previous wording
Gross margin was 42.0% and 40.8% for the three and nine months ended December 31, 2023, respectively, and increased by 440 and 240 basis points, respectively, compared to the three and nine months ended December 31, 2022, primarily driven by lower material and logistics costs, as well as lower promotions, partially offset by unfavorable product mix.
Current wording
Gross margin was 42.8% for the three months ended June 30, 2024 and increased by 430 basis points, compared to the three months ended June 30, 2023, primarily driven by lower product costs, as well as lower promotional spend.
Previous wording
We had an income tax benefit of $9.6 million and an income tax provision of $33.3 million for the three and nine months ended December 31, 2023, respectively, and an income tax provision of $42.7 million and $87.8 million for the three and nine months ended December 31, 2022, respectively. The change in the income tax provision (benefit) for the three and nine months ended December 31, 2023, compared to the three and nine months ended December 31, 2022, was primarily due to the mix of income and losses in the various tax jurisdictions in which we operate as well as the favorable tax impacts from share-based compensation, an agreement to remeasure the tax basis of goodwill under the Swiss Federal Act on Tax Reform and AHV Financing (“TRAF”)with the canton of Vaud, remeasurement of our Swiss deferred tax assets due to a change in tax rate, and Foreign-Derived Intangible Income ("FDII") incentive provided by the Tax Cuts and Jobs Act.
Current wording
We had an income tax provision of$25.6 million and$12.5 million for thethree months ended June 30, 2024 and June 30, 2023, respectively. The change in the income tax provisionfor the three months ended June 30, 2024 compared to the three months ended June 30, 2023 was primarily due to the mix of income and losses in the various tax jurisdictions in which we operate, the favorable tax impacts from share-based compensation and Foreign-Derived Intangible Income.
Previous wording
Net income for the three and nine months ended December 31, 2023 was $244.7 million and $444.5 million, respectively, compared to$140.2 million and $323.1 million for the three and nine months ended December 31, 2022, respectively.
Current wording
Net income for the three months ended June 30, 2024 was $141.8 million compared to$62.7 million for the three months ended June 30, 2023.
Previous wording
There have been no material changes in our critical accounting estimates during the nine months ended December 31, 2023 compared with the critical accounting estimates disclosed in Management's Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the fiscal year ended March 31, 2023.
Current wording
There have been no material changes in our critical accounting estimates during the three months ended June 30, 2024 compared with the critical accounting estimates disclosed in Management's Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the fiscal year ended March 31, 2024.
Previous wording
Our sales for the three and nine months ended December 31, 2023 decreased 1% and 8%, compared to the three and nine months ended December 31, 2022, respectively, primarily due to a decline in sales of most of our product categories as a result of lower demand. If currency exchange rates had been constant in the three and nine months ended December 31, 2023 and 2022, our constant dollar sales reduction rates would have been 3% and 9%, respectively.
Current wording
Our sales for the three months ended June 30, 2024 increased 12%, compared to the three months ended June 30, 2023, primarily due to an increase in sales for Gaming, Keyboards & Combos and Pointing Devices, driven by improved demand. If currency exchange rates had been constant in the three months ended June 30, 2024 and 2023, our sales growth rate in constant currency would have been 13%.
Previous wording
Although our financial results are reported in U.S. Dollars, a portion of our sales was generated in currencies other than the U.S. Dollar, such as the Euro, Chinese Renminbi, Australian Dollar, Canadian Dollar, Japanese Yen, Pound Sterling and New Taiwan Dollar. During the three months ended December 31, 2023, approximately 52% of our sales were denominated in currencies other than the U.S. Dollar.
Current wording
Although our financial results are reported in U.S. Dollars, a portion of our sales was generated in currencies other than the U.S. Dollar, such as the Euro, Chinese Renminbi, Australian Dollar, Canadian Dollar, Japanese Yen, Pound Sterling and New Taiwan Dollar. During the three months ended June 30, 2024, approximately 49% of our sales were denominated in currencies other than the U.S. Dollar.
Previous wording
The following table presents the change in sales by region for the three and nine months ended December 31, 2023, compared with the three and nine months ended December 31, 2022:
Current wording
The following table presents the change in sales by region for the three months ended June 30, 2024, compared with the three months ended June 30, 2023:
Previous wording
Theincrease in sales in the Americas region for the three-month period presented above was primarily driven by an increase in sales of Keyboards & Combos, Video Collaboration, and Webcams, partially offset by a decrease in sales of speakers in our Other category. The decrease in sales in the Americas region for the nine-month period presented above was primarily driven by a decrease in sales of speakers in our Other category, Video Collaboration, and Webcams, partially offset by an increase in sales of Tablet Accessories.
Current wording
Theincrease in sales in the Americas region for the three-month period presented above was primarily driven by an increase in sales for Keyboards & Combos, Gaming, and Pointing Devices.
Previous wording
The decrease in sales in our EMEA region for the three-month period presented above was primarily driven by a decrease in sales of most of our product categories, partially offset by an increase in sales of Gaming and Pointing Devices. The decrease in EMEA region sales for the nine-month period was mainly due to a decrease in sales of Webcams and Video Collaboration, partially offset by an increase in sales of Pointing Devices and Gaming.
Current wording
The increase in sales in our EMEA region for the three-month period presented above was primarily driven by an increase in sales for Keyboards & Combos, Gaming, and Pointing Devices.
Previous wording
The decrease in sales in our Asia Pacific region for the three-month period presented above was primarily driven by a decrease in sales of Gaming and Video Collaboration. The decrease in sales in our Asia Pacific region for the nine-month period presented above was driven by decreases in sales of Gaming, Keyboards & Combos and Video Collaboration.
Current wording
The increase in sales in our Asia Pacific region for the three-month period presented above was primarily driven by an increase in sales for Gaming and Keyboards & Combos.
Previous wording
Sales of Keyboards & Combos increased 4% for thethree months ended December 31, 2023, compared to thethree months ended December 31, 2022, primarily driven by an increase in sales of both cordless and corded keyboard/mice combo products, partially offset by a decrease in sales of cordless keyboards. Sales of Keyboards & Combos decreased 7% for the nine months ended December 31, 2023, compared to the nine months ended December 31, 2022, primarily driven by a decrease in sales of cordless keyboards, partially offset by an increase in sales of cordless keyboard/mice combo products.
Current wording
Sales of Keyboards & Combos increased 19% for thethree months ended June 30, 2024, compared to thethree months ended June 30, 2023, primarily driven by an increase in sales of cordless combo products.
Previous wording
Our Pointing Devices category includes PC- and Mac-related mice including trackballs, touchpads, and presentation tools.
Current wording
Our Pointing Devices category includes PC- and Mac-related mice including trackballs and presentation tools.
Previous wording
Sales of Pointing Devices increased 4% for the three months ended December 31, 2023, compared to the three months ended December 31, 2022, primarily driven by an increase in sales of mouse pads and mouse cases. Sales of Pointing Devices increased 1% for the nine months ended December 31, 2023, compared to the nine months ended December 31, 2022, primarily driven by an increase in sales of mouse pads and mouse cases, partially offset by a decrease in sales of cordless mice.
Current wording
Sales of Pointing Devices increased 9% for the three months ended June 30, 2024, compared to the three months ended June 30, 2023, primarily driven by an increase in sales of cordless mice.
Previous wording
Sales of Video Collaboration decreased 2% and 14% for the three and nine months ended December 31, 2023, compared to thethree and nine months ended December 31, 2022, respectively, primarily due to a decrease in sales of many of our Video Collaboration products driven by lower enterprise spending.
Current wording
Sales of Video Collaboration increased 6% for the three months ended June 30, 2024, compared to thethree months ended June 30, 2023, primarily due to an increase in sales of conference room cameras and docks.
Previous wording
Sales of Webcams decreased 9% and 18% for the three and nine months ended December 31, 2023, compared to the three and nine months ended December 31, 2022, respectively, primarily driven by declines in sales of our VC webcams and sales of our PC-based webcams.
Current wording
Sales of Webcams decreased 3% for the three months ended June 30, 2024, compared to the three months ended June 30, 2023, primarily driven by a decrease in sales of our VC webcams, partially offset by an increase of sales of our PC-based webcams.
Previous wording
Our Tablet Accessories category primarily includes tablet keyboards and styluses.
Current wording
Our Tablet Accessories category primarily includes tablet keyboards.
Previous wording
Sales of Tablet Accessories decreased 1% for the three months ended December 31, 2023, compared to the three months ended December 31, 2022, primarily driven by a decrease in sales of Combo Touch iPad Pro 12.9-inch, partially offset by an increase in sales of Combo Touch. Sales of Tablet Accessories increased 7% for the nine months ended December 31, 2023, compared to the nine months ended December 31, 2022, primarily driven by an increase in sales of our Rugged Combo 3 Touch as well as Combo Touch, introduced in the third quarter of fiscal year 2023, partially offset by the decrease in sales of Rugged Folio. Sales of Tablet Accessories for the nine months ended December 31, 2023, compared to the nine months ended December 31, 2022, benefited from strong demand from the education sector.
Current wording
Sales of Tablet Accessories increased 12% for the three months ended June 30, 2024, compared to the three months ended June 30, 2023, primarily driven by an increase in sales of Rugged Combo 4 Touch and Rugged Combo 4, partially offset by a decrease in sales of Rugged Combo 3 Touch. Sales of Tablet Accessoriesfor the three months ended June 30, 2024, compared to the three months ended June 30, 2023, benefited from strong demand from the education sector.
Previous wording
Gross profit for the three and nine months ended December 31, 2023 and 2022 was as follows (dollars in thousands):
Current wording
Gross profit for the three months ended June 30, 2024 and 2023 was as follows (dollars in thousands):
Previous wording
Gross margin was 42.0% and 40.8% for thethree and nine months ended December 31, 2023, respectively, and increased by 440 and 240 basis points, compared to thethree and nine months ended December 31, 2022, respectively; primarily drivenby lower material and logistics costs, as well as lower promotions, partially offset by unfavorable product mix.
Current wording
Gross margin was 42.8% for thethree months ended June 30, 2024 and increased by 430 basis points compared to thethree months ended June 30, 2023. The gross margin increase was primarily driven by lower product costs, as well as lower promotional spend.
Previous wording
Operating expenses for the three months ended December 31, 2023 were $304.7 million, or 24.3% of sales, compared to $300.5 million, or 23.7% of sales, for the three months ended December 31, 2022. Operating expenses for the nine months ended December 31, 2023 were $883.9 million, or 26.9% of sales, compared to $956.0 million, or 26.7% of sales, for the nine months ended December 31, 2022. Operating expenses, for the three and nine months ended December 31, 2023, compared to the nine months ended December 31, 2022, were impacted by a reduction in marketing and advertising spend and an increase in personnel-related costs, mainly due to higher performance-based compensation.
Current wording
Operating expenses for the three months ended June 30, 2024 and 2023 were as follows (dollars in thousands):
Previous wording
The increase in total operating expenses for the three months ended December 31, 2023, compared to the three months ended December 31, 2022, was primarily driven by an increase in general and administrative expenses, partially offset by a decrease in marketing and selling expenses. The decrease in total operating expenses for the nine months ended December 31, 2023, compared to the nine months ended December 31, 2022, was primarily driven by a decrease in marketing and selling expenses, partially offset by an increase in general and administrative expenses.
Current wording
The increasein total operating expenses for the three months ended June 30, 2024, compared to the three months ended June 30, 2023, was primarily driven by an increase in marketing and selling expenses.
Previous wording
During the three months ended December 31, 2023, marketing and selling expenses decreased $7.5 million, compared to the three months ended December 31, 2022, primarily driven by our reduction in third-party marketing and advertising spend, partially offset by higher performance-based compensation expense. During the nine months ended December 31, 2023, marketing and selling expenses decreased $83.4 million, compared to the nine months ended December 31, 2022, primarily driven by our reduction in third-party marketing and advertising spend.
Current wording
During the three months ended June 30, 2024, marketing and selling expenses increased $17.7 million, compared to the three months ended June 30, 2023, primarily driven by an increase in third-party marketing and advertising spend as well as higher performance-based compensation expense.
Previous wording
During the three months ended December 31, 2023, research and development expenses increased $7.1 million, compared to the three months ended December 31, 2022, primarily driven by higher performance-based compensation expense. During the nine months ended December 31, 2023, research and development expenses increased $1.7 million, compared to the nine months ended December 31, 2022, primarily due to higher performance-based compensation expense, partially offset by lower outsourcing costs.
Current wording
During the three months ended June 30, 2024, research and development expenses increased $4.7 million, compared to the three months ended June 30, 2023, primarily driven by higher performance-based compensation expense.
Previous wording
During the three and nine months ended December 31, 2023, general and administrative expenses increased $9.9 million and $24.3 million, respectively, compared to the three and nine months ended December 31, 2022, primarily driven by higher performance-based compensation expense.
Current wording
During the three months ended June 30, 2024, general and administrative expenses decreased $3.8 million, compared to the three months ended June 30, 2023, primarily driven by an accrued litigation cost recorded in the three months ended June 30, 2023.
Previous wording
During the three and nine months ended December 31, 2023, amortization of intangible assets and acquisition-related costs remained relatively flat, compared to the three and nine months ended December 31, 2022.
Current wording
During the three months ended June 30, 2024, amortization of intangible assets and acquisition-related costs remained flat, compared to the three months ended June 30, 2023.
Previous wording
The restructuring charges, net for the three and nine months ended December 31, 2023 and 2022, were related to costs incurred as a result of our restructuring plan initiated during fiscal year 2023. We expect to substantially complete this restructuring plan within fiscal year 2024.
Current wording
The restructuring charges, net for the three months ended June 30, 2024 and 2023, were related to costs incurred as a result of our restructuring plan initiated during fiscal year 2023. These restructuring activities were substantially completed during fiscal year 2024.
Previous wording
Interest income for the three and nine months ended December 31, 2023 and 2022 was as follows (in thousands):
Current wording
Interest income for the three months ended June 30, 2024 and 2023 was as follows (in thousands):
Previous wording
We invest in highly liquid instruments with an original maturity of three months or less at the date of purchase, which are classified as cash equivalents. During the three and nine months ended December 31, 2023, interest income increased $8.2 million and $24.9 million, compared to the three and nine months ended December 31, 2022, respectively, primarily driven by an increase in interest rates.
Current wording
We invest in highly liquid instruments with an original maturity of three months or less at the date of purchase, which are classified as cash equivalents. During the three months ended June 30, 2024, interest income increased $6.0 million, compared to the three months ended June 30, 2023, primarily driven by an increase in the balance of our investments that are classified as cash equivalents as well as an increase in interest rates.
Previous wording
Other income (expense), net for the three and nine months ended December 31, 2023 and 2022 was as follows (in thousands):
Current wording
Other income (expense), net for the three months ended June 30, 2024 and 2023 was as follows (in thousands):
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Current report — wording carried from elsewhere
Our diverse portfolio includes: Gaming, Keyboards & Combos, Pointing Devices, Video Collaboration, Webcams, Tablet Accessories, and Headsets. These products are all classified under a single operating segment: Peripherals (see Note 12 to our condensed consolidated financial statements).
Current report — wording carried from elsewhere
•Hybrid work: Hybrid work provides an opportunity to equip multiple workspaces including in the office and other places of work, as well as at home and away from home. Hybrid work also provides an opportunity for increased enterprise and consumer adoption of video conferencing. Our video collaboration products are compatible with a variety of video conference platforms, including Zoom, Microsoft Teams and Google Meet.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
See Note 13 to our condensed consolidated financial statements for additional information.