10q10k10q10k.net

What changed in LOGITECH INTERNATIONAL S.A.'s 10-K — 2023 vs 2024

vs

Paragraph-level year-over-year comparison of LOGITECH INTERNATIONAL S.A.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+346 added−349 removedSource: 10-K (2024-05-16) vs 10-K (2023-05-17)

Top changes in LOGITECH INTERNATIONAL S.A.'s 2024 10-K

346 paragraphs added · 349 removed · 264 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

66 edited+23 added−53 removed33 unchanged
Biggest changeLogitech International S.A. | Fiscal 2023 Form 10-K | 4 Table of Contents • The Logitech Wireless Mouse M650, which offers a new precise scrolling wheel, an 18-month battery life, Logi Bolt connectivity compatible with any operating system, side-buttons and comfortable design, and is available in Large, Medium and left-handed versions with sustainable materials. • The Logitech Wireless Mouse M185, a wireless mouse with nano receiver technology that is compatible with any computer. • The Logitech Pebble Mouse, a wireless mobility mouse with dual connectivity (BT and unifying nano technology) that is compatible with any computer. • Two recently introduced mice, Logitech Lift vertical mouse with Logi Bolt wireless technology and the new smart wheel available in right and left-handed version, and Pop Mouse for younger generations that offers more style at the desk.
Biggest changeEnabled with Logitech Flow cross-computer control software and Logi Bolt cross-operating system connectivity, these products represent the new paradigm for precise, fast, comfortable cross-computer digital navigation and digital creativity. • The Logitech Signature M650 Wireless Mouse, which introduced Smartwheel for precise and fast scrolling, and clicks silently due to our SilentTouch technology, has an 18-month battery life, dual connectivity with Bluetooth and Logi Bolt, compatible with nearly all operating systems, side-buttons and comfortable design, and is available in Large, Medium and left-handed versions. • The Logitech Wireless Mouse M185, a reliable wireless mouse with comfortable shape and compact design. • The Logitech Wireless Mouse M220 Silent is an upgraded version of the M185 with silent clicking due to our SilentTouch technology. • The Logitech Pebble Mouse, a slim and minimalist wireless mouse, comes with new and exciting colors, with Bluetooth connectivity compatible with Logi Bolt technology. • The Logitech Lift, a vertical mouse with Logi Bolt wireless technology and the new smart wheel available in right and left-handed version, • Pop Mouse, for younger generations that offers more style at the desk.
We also protect details about our products and services as trade secrets through employee training, license and non-disclosure agreements, technical measures and other reasonable efforts to preserve confidentiality. Material Government Regulations We conduct operations in a number of countries and we are subject to a variety of laws and regulations which vary from country to country.
We also protect details about our products and services as trade secrets through employee training, license and non-disclosure agreements, technical measures and other reasonable efforts to preserve confidentiality. Government Regulations We conduct operations in a number of countries and we are subject to a variety of laws and regulations which vary from country to country.
In addition, because of the continuing convergence of the markets for computing devices and consumer electronics, we expect greater competition in the future from well-established consumer electronics companies in our developing categories, as well as future ones we might enter. Many of these companies have greater financial, technical, sales, marketing, and other resources than we have.
In addition, because of the continuing convergence of the markets for computing devices and consumer electronics, we expect greater competition in the future from well-established consumer electronics companies in our developing categories, as well as future categories we might enter. Many of these companies have greater financial, technical, sales, marketing, and other resources than we have.
Spotify, Apple Music); content streaming platforms (e.g. Twitch, YouTube); and creativity and productivity platforms (e.g. Google Workplace, Adobe Creative Cloud). We sell our products to a broad network of international customers, in the Americas, Europe, the Middle East, and Africa ("EMEA") and Asia Pacific.
League of Legends, Call of Duty, Valorant); music streaming platforms (e.g. Spotify, Apple Music); content streaming platforms (e.g. Twitch, YouTube); and creativity and productivity platforms (e.g. Google Workplace, Adobe Creative Cloud). We sell our products to a broad network of international customers, in the Americas, Europe, the Middle East, and Africa ("EMEA") and Asia Pacific.
In addition, to measure our employees’ satisfaction at Logitech, we distribute a bi-annual employee engagement survey. Most recently, we conducted a survey in December 2022, in which 85% of our global office employees participated.
In addition, to measure our employees’ satisfaction at Logitech, we distribute a bi-annual employee engagement survey. Most recently, we conducted a survey in December 2023, in which 86% of our global office employees participated.
Logitech International S.A. | Fiscal 2023 Form 10-K | 13 Table of Contents
Logitech International S.A. | Fiscal 2024 Form 10-K | 13 Table of Contents
Research and Development We recognize that continued investment in product research and development is critical to facilitate innovation of new and improved products, technologies and experiences. Our research and development expenses for fiscal years 2023, 2022 and 2021 were $280.8 million , $291.8 million and $226.0 million, respectively.
Research and Development We recognize that continued investment in product research and development is critical to facilitate innovation of new and improved products, technologies and experiences. Our research and development expenses for fiscal years 2024, 2023 and 2022 were $287.2 million, $280.8 million and $291.8 million, respectively.
In the U.S., underrepresented minorities (defined as Black or African American, Asian, Hispanic or Latino, American Indian or Alaska Native, and Native Hawaiian or Other Pacific Islander) represented 47% of our workforce, and 44% were in managerial roles. To foster a more inclusive environment, we offer training sessions to emphasize awareness of self, bias and privilege, and inclusion.
In the U.S., underrepresented minorities (defined as Black or African American, Asian, Hispanic or Latino, American Indian or Alaska Native, and Native Hawaiian or Other Pacific Islander) represented 48% of our employees. To foster a more inclusive environment, we offer training sessions to emphasize awareness of self, bias and privilege, and inclusion.
Such laws and regulations include, in addition to environmental regulations described below, tax, import/export and anti-corruption laws, varying accounting, auditing and financial reporting standards, import or export restrictions or licensing requirements, trade protection measures, custom duties, tariffs, import or export duties, and other trade barriers, restrictions and regulations.
Such laws and regulations include tax, import/export and anti-corruption laws, varying accounting, auditing and financial reporting standards, import or export restrictions or licensing requirements, trade protection measures, custom duties, tariffs, import or export duties, and other trade barriers, restrictions and regulations.
While we incur increasing costs to comply with such other government regulations, we do not believe that our compliance with such requirements will have a material effect on our capital expenditures, competitive position, consolidated results of operations, earnings, or cash flows.
Dodd-Frank Wall Street Reform and Consumer Protection Act. While we incur increasing costs to comply with such other government regulations, we do not believe that our compliance with such requirements will have a material effect on our capital expenditures, competitive position, consolidated results of operations, earnings, or cash flows.
We expect continued competitive pressure in our business, including in the terms and conditions that our competitors offer customers, which may be more favorable than our terms and conditions and may require us to take actions to increase our customer incentive programs, which could impact our sales and operating margins. Creativity and Productivity Pointing Devices: Apple Inc.
We expect continued competitive pressure in our business, including in the terms and conditions that our competitors offer customers, which may be more favorable than our terms and conditions and may require us to take actions to increase our customer incentive programs, which could impact our sales and operating margins. Gaming Competitors for our gaming products include Razer Inc.
We support these channels with our direct sales force and third-party distribution centers located in North America, South America, Europe and Asia Pacific. Our distributor customers typically resell products to retailers, value-added resellers, systems integrators and other distributors with whom Logitech does not have a direct relationship.
We support these channels with our direct sales force and third-party distribution centers located in all three geographic regions. Our distributor customers typically resell products to retailers, value-added resellers, systems integrators and other distributors with whom Logitech does not have a direct relationship.
Some of our key human capital management programs are summarized below. Diversity and Inclusion We believe that reflecting the diverse world in which we live - through our people and by fostering an inclusive culture - provides us with the foundation needed to create experiences that enable all people to pursue their passions, which is our corporate purpose.
Diversity and Inclusion We believe that reflecting the diverse world in which we live - through our people and by fostering an inclusive culture - provides us with the foundation needed to create experiences that enable all people to pursue their passions, which is our corporate purpose.
In fiscal years 2023, 2022 and 2021, Amazon Inc. and its affiliated entities together accounted for 19%, 17% and 13% of our gross sales, respectively. In fiscal years 2023, 2022 and 2021, Ingram Micro Inc. and its affiliated entities together accounted for 13%, 15% and 14% of our gross sales, respectively.
In fiscal years 2024, 2023 and 2022, Ingram Micro Inc. and its affiliated entities together accounted for 13% , 13% and 15% of our gross sales, respectively. TD Synnex and its affiliated entities together accounted for 14% , 15%, and 14% of our gross sales in fiscal years 2024, 2023, and 2022, respectively.
For more information about such regulations and how they may impact us, see "Risks Related to our Global Operations and Regulatory Environment" and “We are subject to risks related to our environmental, social and governance ("ESG") activities and disclosures” in Item 1A "Risk Factors" and Note 7—Income Taxes in our Notes to consolidated financial statements below.
For more information about such regulations and how they may impact us, see "Risks Related to Global Nature of our Operations and Regulatory Environment" in Item 1A "Risk Factors" and Note 7 Income Taxes in our Notes to consolidated financial statements below.
Logitech's products can be purchased in a number of major retail chains, where we typically have access to significant shelf space. In addition, Logitech products can be purchased online either directly or indirectly from Logitech.com or through e-tailers, the websites of our major retail chains, and others. Logitech products are also carried by business-to-business direct market resellers.
Logitech's products can be purchased in a number of major retail chains, where we typically have access to significant shelf space. In addition, Logitech products can be purchased online either directly or indirectly from Logitech.com or through e-tailers, the websites of our major retail chains, and other online and social channels.
We expect to continue to devote significant resources to research and development, including devices for digital platforms, video communications, wireless technologies, power management, and user interfaces to sustain our competitive position.
We expect to continue to devote significant resources to research and development, including devices for digital platforms, video communications, wireless technologies, power management, and user interfaces to sustain our competitive position. Design Logitech uses design-led engineering as a strategic differentiator.
Our direct employees are located across Americas, EMEA and Asia-Pacific and bring a range of perspectives and skills to Logitech. As of March 31, 2023, 46% of our office employees were located in Asia-Pacific, 30% in the Americas, and 24% in EMEA.
Our direct employees are located across Americas, EMEA and Asia-Pacific and bring a range of perspectives and skills to Logitech. As of March 31, 2024, 47% of our office employees were located in Asia-Pacific, 29% in the Americas, and 24% in EMEA. As of March 31, 2024, females represented 38% of our global office employees.
Harnett served in various legal and management roles at Eventbrite, Inc., a global self-service ticketing and experience technology platform, most recently as Chief Legal and Operations Officer from October 2019 to June 2020.
Harnett served in various legal and management roles at Eventbrite, Inc., a global Logitech International S.A. | Fiscal 2024 Form 10-K | 12 Table of Contents self-service ticketing and experience technology platform, most recently as Chief Legal and Operations Officer from October 2019 to June 2020.
Operations Logitech’s operations capability consists of a hybrid model of in-house manufacturing (including a wholly-owned facility in Suzhou, China) and third-party contract manufacturers (principally in Asia), which allows us to effectively respond to rapidly changing demand, leverage economies of scale, protect intellectual property, and offer high quality production in even the most sophisticated of products.
Operations Logitech’s operations capability consists of a hybrid model of in-house manufacturing (including a wholly-owned facility in Suzhou, China) and third-party contract manufacturers and original design manufacturers (principally in Asia), which allows us to effectively respond to rapidly changing demand and leverage economies of scale.
Our key products in this category include: • Logitech Rally Bar, an all-in-one video bar purpose-built for midsize rooms, featuring brilliant video, room-filling audio, and the flexibility to deploy in PC or appliance mode. • Logitech Rally which offers best-in-class video conferencing with Ultra HD 4K video and professional audio that easily turns medium- to large-sized conference rooms into video-enabled collaboration rooms. • Logitech MeetUp which is Logitech’s premier ConferenceCam designed for huddle rooms, with a room-capturing 120° field of view ("FOV") , 4K optics and exceptional audio performance. • Logitech Tap touch-screen controller which connects to any computer through USB and serves as an ideal controller for video conferencing room solutions from Google®, Microsoft®, and Zoom. • Logitech BRIO which has 4K video, RightLight 3 and high dynamic range ("HDR") to improve challenging lighting, and Windows Hello facial recognition support for secure login using just a user's face.
Our key products in this category include: • Logitech Rally Bar, an all-in-one video bar purpose-built for midsize rooms, featuring brilliant video, room-filling audio, and the flexibility to deploy in PC or appliance mode. • Logitech Rally, which offers best-in-class video conferencing with Ultra HD 4K video and professional audio that easily turns medium- to large-sized conference rooms into video-enabled collaboration rooms. • Logitech MeetUp, which is Logitech’s premier ConferenceCam designed for huddle rooms, with a room-capturing 120° field of view ("FOV"), 4K optics and exceptional audio performance. • Logitech Tap touch-screen controller, which connects to any computer through USB and serves as an ideal controller for video conferencing room solutions from Google®, Microsoft®, and Zoom. • The recently launched Logitech Sight, a tabletop companion camera with intelligent multi-participant framing through front and center views.
Logitech International S.A. | Fiscal 2023 Form 10-K | 3 Table of Contents Engineering Our decades-long expertise in key engineering disciplines such as sensors, acoustics, optics, wireless, and power management is a core competitive advantage of Logitech.
Engineering Our decades-long expertise in key engineering disciplines such as sensors, acoustics, optics, wireless, and power management is a core competitive advantage of Logitech.
Incorporating innovative design and advanced technologies, some of the key products and solutions in this category include: • The Logitech G PRO X Superlight Wireless Gaming Mouse that was designed in collaboration with the world's top esports professionals, featuring our LIGHTSPEED TM professional grade wireless technology, and weighing in at less than 63 grams. • The Logitech Pro Racing Wheel that features our exclusive TRUEFORCE feedback system that connects directly to in-game physics, and our new Direct Drive motor. • The ASTRO A30 Wireless Headset that is compatible with PC, Xbox Series X|S, PlayStation5, Nintendo Switch, and mobile, portable gaming devices.
Incorporating innovative design and advanced technologies, some of the key products and solutions in this category include: • The Logitech G PRO X Superlight 2 Wireless Gaming Mouse that was designed in collaboration with the world's top esports professionals, featuring our LIGHTSPEED TM professional grade wireless technology, and weighing in at less than 63 grams. • The Logitech Pro Racing Wheel that features our exclusive TRUEFORCE feedback system that connects directly to in-game physics, and our new Direct Drive motor. • The Logitech Pro X 2 Lightspeed Wireless Headset that features pro-grade sound, LIGHTSPEED wireless, and an emphasis on comfort. • The recently launched ASTRO 50X Wireless Headset, which is compatible with PC, Xbox Series X|S, PlayStation5, Nintendo Switch, and mobile, and portable gaming devices and features our unique PLAYSYNC technology that enables gamers to seamlessly switch between multiple consoles. • Streamlabs services, which provide streaming and monetization tools for content creators to manage their audience and broadcast.
Keyboards & Combos: Microsoft and Apple are the main competitors in our PC keyboard and combo product lines. We also experience competition and pricing pressure for corded and cordless keyboards and combos from less-established brands, including house brands and local competitors in Asian markets, such as Shenzhen Rapoo, IKBC, and Xiaomi Corporation.
We also experience competition and pricing pressure for corded and cordless keyboards and combos from less-established brands, including house brands and local competitors in Asian markets, such as Shenzhen Rapoo Technology Co., Ltd. ("Shenzhen Rapoo"), IKBC, and Xiaomi Corporation ("Xiaomi"). Pointing Devices Apple, Microsoft, Lenovo, Dell, and HP are our main competitors worldwide for pointing devices.
As part of the survey, employees provided weighted feedback on their experience at Logitech, on measures such as happiness, retention and their perspective on our current state of workplace inclusivity at Logitech.
As part of the survey, employees provided weighted feedback on their experience at Logitech, on measures such as happiness, retention and their perspective on our current state of workplace inclusivity at Logitech. Safety, Health and Well-being We look to safeguard the safety, health and well-being of all members of the Logitech team.
Harman is our largest competitor. Personal voice assistants and other devices that offer music, such as Sonos, Amazon's Echo, Google Home (owned by Alphabet, Inc.) and Apple HomePod, also compete with our products. Amazon is also a significant customer of our products.
Personal voice assistants and other devices that offer music, such as Sonos Inc., Amazon's Echo, Google Home (owned by Alphabet, Inc.) and Apple HomePod, also compete with our products. Amazon is also a significant customer of our products. For PC speakers, our competitors include Bose, Cyber Acoustics LLC, and Creative Labs, Inc., among others.
ITEM 1. BUSINESS Company Overview Founded in 1981, and headquartered in Lausanne, Switzerland, Logitech International is a Swiss public company listed on the SIX Swiss Exchange (LOGN) and on the Nasdaq Global Select Market (LOGI). Logitech’s website address is www.logitech.com.
ITEM 1. BUSINESS Company Overview Founded in 1981, and headquartered in Lausanne, Switzerland, Logitech International is a Swiss public company listed on the SIX Swiss Exchange (LOGN) and on the Nasdaq Global Select Market (LOGI). Logitech’s website address is www.logitech.com. Logitech designs software-enabled hardware solutions that help businesses thrive and bring people together when working, creating, gaming and streaming.
No single patent is in itself essential to Logitech as a whole. From time to time, we receive claims that we may be infringing on patents or other intellectual property rights of others. As appropriate, claims are referred to legal counsel, and current claims are in various stages of evaluation and negotiation.
From time to time, we receive claims that we may be infringing on patents or other intellectual property rights of others. As appropriate, claims are referred to legal counsel, and current claims are in various stages of evaluation and negotiation. If necessary or desirable, we may seek licenses for certain intellectual property rights.
Human Capital Resources Employees Our human capital resources include persons employed directly by us or indirectly through contingent workforce arrangements. As of March 31, 2023, we employed approximately 7,400 persons, of which approximately 2,400 were employed, directly and indirectly, in our Suzhou manufacturing operations.
Logitech International S.A. | Fiscal 2024 Form 10-K | 10 Table of Contents Human Capital Resources Employees Our human capital resources include persons employed directly by us or indirectly through contingent workforce arrangements. As of March 31, 2024, we employed approximately 7,300 persons, of which approximately 2,700 were employed in our Suzhou manufacturing operations.
Prior to joining Logitech, Mr. Arunkundrum was a Principal at A.T. Kearney, a global management Logitech International S.A. | Fiscal 2023 Form 10-K | 12 Table of Contents consulting firm, from July 2014 to August 2015.
Prior to joining Logitech, Mr. Arunkundrum was a Principal at A.T. Kearney, a global management consulting firm, from July 2014 to August 2015.
These products are all classified under a single operating segment: Peripherals (see Note 15 to our consolidated financial statements). They also are compatible with many cloud or cloud-based services: video conferencing platforms (e.g. Zoom, Microsoft Teams, Google Meet); esports or video games (e.g. League of Legends, Call of Duty, Valorant); music streaming platforms (e.g.
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 15 to our consolidated financial statements). They also are compatible with many cloud or cloud-based services: video conferencing platforms (e.g. Zoom, Microsoft Teams, Google Meet); esports or video games (e.g.
Customer Service and Technical Support Our customer service organization provides user technical support, support related to product inquiry, and order support. We support these customer service functions with outsourced operations as well as inhouse support teams located in countries across the world.
These engineering capabilities combined with our award-winning design team form the basis of Logitech's key innovation engine. Customer Service and Technical Support Our customer service organization provides user technical support, support related to product inquiry, and order support. We support these customer service functions with outsourced operations as well as in-house support teams located in countries across the world.
If necessary or desirable, we may seek licenses for certain intellectual property rights. Refer also to the discussion in Item 1A "Risk Factors—"We may be unable to protect our proprietary rights.
Refer also to the discussion in Item 1A "Risk Factors"—"We may be unable to protect our proprietary rights.
Music Mobile Speakers: Our Mobile Speakers category is a portfolio of portable wireless Bluetooth speakers for music on the go. The top revenue-generating product in our Mobile Speakers category during fiscal year 2023 was Ultimate Ears BOOM 3 ("BOOM3"), our ruggedized portable Bluetooth wireless speaker.
Our mobile speakers is a portfolio of portable wireless Bluetooth speakers for music on the go. The top revenue-generating product in our mobile speakers during fiscal year 2024 was our ruggedized portable Bluetooth wireless speaker. During fiscal year 2024, our collection of portable Bluetooth speakers included WONDERBOOM3, BOOM3, MEGABOOM3, HYPERBOOM, and our recently launched speaker, EPICBOOM.
Mr. Darrell holds a BA degree from Hendrix College and an MBA from Harvard University. Charles Boynton joined Logitech as Chief Financial Officer in February 2023. Prior to joining Logitech, Mr. Boynton served as the Executive Vice President, Chief Financial Officer of Plantronics, Inc.
Faber holds a Bachelor of Arts in Journalism and a Master of Business Administration from the University of Houston (Texas, USA). Charles Boynton joined Logitech as Chief Financial Officer in February 2023. Prior to joining Logitech, Mr. Boynton served as the Executive Vice President, Chief Financial Officer of Plantronics, Inc.
Sales and Distribution Our sales and marketing activities are organized into three geographic regions: the Americas (North and South America), EMEA (Europe, Middle East, Africa) and Asia Pacific (China, Japan, Australia, Taiwan, India and other countries). We sell our products primarily to a network of distributors, retailers and e-tailers.
Logitech International S.A. | Fiscal 2024 Form 10-K | 6 Table of Contents Sales and Distribution Our sales and marketing activities are organized into three geographic regions: the Americas (North and South America), EMEA (Europe, Middle East, Africa) and Asia Pacific (China, Australia, Japan, India, Korea, Taiwan and other countries).
Sales are generally highest during our third fiscal quarter (October to December) primarily due to the increased consumer demand for our products during the year-end holiday buying season and year-end spending by enterprises.
No other customer individually accounted for more than 10% of our gross sales in fiscal years 2024, 2023 or 2022. Seasonality Our product sales are typically seasonal. Sales are generally highest during our third fiscal quarter (October to December) primarily due to the increased consumer demand for our products during the year-end holiday buying season and year-end spending by enterprises.
Go-To-Market Logitech has an extensive global go-to-market network that is leveraged to introduce new products, enter new market categories and optimize the value of our existing products and product categories. We have multiple opportunities to drive growth through existing products in existing and new retailers and e-tailers as well as through new products in existing and new retailers and e-tailers.
For revenue by geographic region, see Note 15 to our consolidated financial statements. Logitech has an extensive global go-to-market network that is leveraged to optimize the value of our existing products and product categories as well as to introduce new products and enter new product categories. We sell our products primarily to a network of distributors, retailers and e-tailers.
None of Logitech's U.S. direct employees are represented by a labor union or are subject to a collective bargaining agreement. Certain other countries, such as China, provide by law for employee rights, which include requirements similar to collective bargaining agreements. We believe that our employee relations are good. We rely on different programs and initiatives to support our goals.
This includes people employed directly by us, or indirectly through contingent workforce arrangements. None of Logitech's U.S. direct employees are represented by a labor union or are subject to a collective bargaining agreement. Certain other countries, such as China, provide by law for employee rights, which include requirements similar to collective bargaining agreements.
Furthermore, we continue to extend our engineering capabilities into more advanced technologies such as software, apps, cloud, data analytics, machine learning, artificial intelligence ("AI") and some core building blocks of navigation and tracking in augmented reality ("AR") or virtual reality ("VR").
Furthermore, we continue to extend our engineering capabilities into more advanced technologies such as software, generative AI, cloud services, data analytics, machine learning, and some core building blocks of navigation and tracking for spatial computing and augmented/virtual reality environments. Our engineering team has expertise in bringing together these many technologies, across hardware and software to develop an innovative portfolio.
("Apple"), Microsoft Corporation ("Microsoft"), Lenovo Group Ltd (“Lenovo”), Dell Technologies Inc. ("Dell"), and HP Inc. are our main competitors worldwide. We also experience competition and pricing pressure from less-established brands, including house brands and local competitors in Asian markets, such as Elecom Co., Ltd., Buffalo Inc., Shenzhen Rapoo Technology Co., Ltd. (“Shenzhen Rapoo”), and Xiaomi Corporation.
We also experience competition and pricing pressure from less-established brands, including house brands and local competitors in Asian markets, such as Elecom Co., Ltd., Buffalo Inc., Shenzhen Rapoo, and Xiaomi. Video Collaboration Our competitors for video collaboration products include Cisco Systems, Inc.
We hold various United States patents and pending applications, together with corresponding patents and pending applications from other countries. While we believe that patent protection is important, we also believe that patents are of less competitive significance than factors such as technological innovation, ease of use, and quality design.
While we believe that patent protection is important, we also believe that patents are of less competitive significance than factors such as technological innovation, ease of use, and quality design. No single patent is in itself essential to Logitech as a whole.
Our talent development program includes a dedicated training center at our production facility, a number of workshop-based, leadership development, mentorship, coaching career development and team building programs that remain available remotely. Information About Our Executive Officers. The following sets forth certain information regarding our executive officers as of May 17, 2023 : Name Age Nationality Position Bracken Darrell 60 U.S.
Our talent development program includes a dedicated training center at our production facility, a number of workshop-based, leadership development, mentorship, coaching career development and team building programs that remain available remotely. Logitech International S.A. | Fiscal 2024 Form 10-K | 11 Table of Contents Information About Our Executive Officers.
Although we are one of the leaders in the tablet keyboard market and continue to bring innovative offerings to the market, we expect the competition may increase. Competitors in the tablet case market include Apple, Otter Products LLC, Speck Products and a large number of smaller brands.
Tablet Accessories Competitors in the tablet accessories market are Apple, Zagg Inc., Kensington Computer Products Group, Belkin International, Inc., Targus Corporation and other less-established brands. Although we are one of the leaders in the tablet keyboard market and continue to bring innovative offerings to the market, we expect the competition may increase.
We may also encounter more competition if any of our competitors in one or more categories decide to enter other categories in which we currently operate.
We have experienced aggressive price competition and other promotional activities from our primary competitors and less-established brands, including brands owned by some retail customers known as house brands. We may also encounter more competition if any of our competitors in one or more categories decide to enter other categories in which we currently operate.
Logitech International S.A. | Fiscal 2023 Form 10-K | 8 Table of Contents Music Mobile Speakers: Our competitors for Bluetooth wireless speakers include Bose Corporation ("Bose"), Harman International Industries, Inc (owned by Samsung Electronics Co., Ltd., Harman owns JBL and has Harman Kardon as a division), and Beats Electronics LLC ("Beats") (owned by Apple), among others.
Headsets For headsets, our main competitors include Poly and Jabra, among others. In-ear headphones competitors include Beats, Bose, Apple, Sony Corporation, JBL and Sennheiser, among others. Logitech International S.A. | Fiscal 2024 Form 10-K | 9 Table of Contents Other Our competitors for Bluetooth wireless speakers include Bose Corporation ("Bose") and Harman International Industries, Inc ("Harman"), among others.
Our supply chain’s extensive global reach, key distribution channels, adoption of factory automation and strategic business relationships combined with extensive analytic modeling expertise, optimization tools and global processes provide a competitive advantage against many of our competitors.
We believe our supply chain’s extensive global reach, key distribution channels, adoption of factory automation and strategic business relationships combined with extensive analytic modeling expertise, optimization tools and global processes are key competitive advantages. Marketing Across Logitech’s multiple product categories, we focus on enhancing our marketing capabilities around brand strategy and execution, digital marketing, and marketing technology.
The worldwide operations group also supports the business units and marketing and sales organizations through the management of distribution centers and the supply chain and logistics networks. New product launches, process engineering, commodities management, logistics, quality assurance, operations management and management of Logitech's contract manufacturers occur in China, Taiwan, Hong Kong, Malaysia, Thailand, Mexico, and Vietnam.
The worldwide operations group also supports the business units and marketing and sales organizations through the management of distribution centers and the supply chain and logistics networks.
Boynton earned his master’s degree in business administration at the Kellogg School of Management at Northwestern University and holds a Bachelor of Science degree in Accounting from the Kelley School of Business at Indiana University Bloomington. Prakash Arunkundrum is Logitech’s Chief Operating Officer, a position he has held since February 2023.
Boynton earned his master’s degree in business administration at the Kellogg School of Management at Northwestern University and holds a Bachelor of Science degree in Accounting from the Kelley School of Business at Indiana University Bloomington. As disclosed in our Current Report on Form 8-K dated March 17, 2024, Mr.
Some of our key products in this category include: • The Logitech Wireless Combo MK270, a full-size keyboard and mouse combination with a tiny USB receiver. • The Logitech MX Keys Wireless keyboard, a premium backlit keyboard with customizable keys to directly access menus and shortcuts within leading creativity and productivity apps.
Keyboards & Combos Logitech offers a variety of corded and cordless keyboards and combos (keyboard-and-mouse combinations). Some of our key products in this category include: • The Logitech Wireless Combo MK270, a reliable entry level full-size keyboard and mouse combination with a tiny plug and play USB receiver.
Earlier in his career, Mr. Boynton held key financial positions at Intelliden, Commerce One, Inc., Kraft Foods, Inc., and Grant Thornton, LLP. Mr. Boynton currently serves on the Board of Directors of Nextracker Inc. Mr.
Earlier in his career, Mr. Boynton held key financial positions at Intelliden, Commerce One, Inc., Kraft Foods, Inc., and Grant Thornton, LLP. Mr. Boynton served as a non-executive director of Nextracker Inc., a provider of intelligent, integrated solar tracker and software solutions, from February 2023 to March 2024. Mr.
Gaming Competitors for our gaming products include Razer, Corsair Gaming, Inc., SteelSeries (owned by GN), Turtle Beach Corporation and HyperX (owned by HP Inc.), among others. Video Collaboration Our competitors for Video Collaboration products include Cisco Systems, Inc., Poly (owned by HP Inc.), Jabra (owned by GN), AVer Information Inc., Neat and Yealink (Xiamen) Network Technology Co.Ltd, among others.
("Cisco"), Poly (owned by HP), Jabra (owned by GN), AVer Information Inc., Neat, and Yealink (Xiamen) Network Technology Co.Ltd, among others. Webcams Our primary competitors for webcams are Microsoft, HP, Dell, Lenovo and Cisco and other manufacturers taking smaller market share such as Razer and HIKVision.
Products Logitech designs, manufactures and markets products that help businesses thrive and bring people together when working, creating, gaming and streaming, for use by consumers and enterprise customers. Creativity & Productivity Pointing Devices: Logitech offers a variety of pointing devices.
Products Logitech designs, manufactures and sells products that help businesses thrive and bring people together when working, creating, gaming and streaming, for use by consumers and enterprise customers. Logitech International S.A. | Fiscal 2024 Form 10-K | 4 Table of Contents Gaming Logitech G provides products for gamers and streamers, including mice, racing wheels, headsets, keyboards, microphones and streaming services.
Competition Our product categories are characterized by large, well-financed competitors, short product life cycles, continual performance enhancements, and rapid adoption of technological and product advancements by competitors in our retail markets. We have experienced aggressive price competition and other promotional activities from our primary competitors and less-established brands, including brands owned by some retail customers known as house brands.
Logitech International S.A. | Fiscal 2024 Form 10-K | 8 Table of Contents Competition Our product categories are characterized by large, well-financed competitors, short product life cycles, continual performance enhancements, and rapid adoption of technological and product advancements by competitors in our retail markets.
Video Collaboration The Video Collaboration category includes Logitech’s conference room cameras, which combine enterprise-quality audio and high definition ("HD") 4K video with affordability to bring video conferencing to businesses of any size, as well as state of the art webcams and headsets that turn any desktop into an instant collaboration space.
Logitech International S.A. | Fiscal 2024 Form 10-K | 5 Table of Contents Video Collaboration The Video Collaboration category includes Logitech’s conference room cameras (“ConferenceCams”), which combine enterprise-quality audio and high definition ("HD") 4K video with affordability to bring video conferencing to a variety of room sizes.
Some of our key products in this category include : • The Combo Touch for the iPad 9th Generation, iPad Air, iPad Pro 11 and iPad Pro 12.9, is our newest design offering a Smart Connected backlit full-size keyboard, any-angle kickstand for flexible viewing angles and a trackpad for gestures, clicks and navigation. • The Rugged Folio Keyboard for the iPad 9th Generation, bringing a more protective rugged folio, with a wipeable fabric keyboard, a rugged and protective holder and an any-angle kickstand to allow multiple viewing angles.
These products are mostly for iPads but are also for select Samsung and other Android tablets. Some of our key products in this category include : • The Combo Touch line-up for various iPad models is our flagship design offering a backlit keyboard, any-angle kickstand for flexible viewing angles, and a trackpad for gestures, clicks, and navigation.
Some of our key products in this category include: • The Logitech MX Master 3 and MX Anywhere 3 wireless mice, our flagship wireless mouse products. Enabled with Logitech Flow cross-computer control software and Logi Bolt cross-operating system connectivity, these products represent the new paradigm for precise, fast, comfortable cross-computer digital navigation and digital creativity.
Pointing Devices Logitech offers a variety of pointing devices. Some of our key products in this category include: • The Logitech MX Master 3 and MX Anywhere 3 wireless mice, our flagship wireless mouse products.
We recently added the MX Keys mini wireless keyboard ideal for smaller spaces and creators and Logitech MX mechanical wireless keyboard. • The Logitech K380 wireless minimalist keyboard with multi-switch functionality to easily navigate from one screen to another (from PC to Phone to tablets) that is compatible with any computer.
We recently added the MX Keys mini wireless keyboard ideal for smaller spaces and creators and Logitech MX mechanical wireless keyboard. • The recently launched Logitech Pebble Keys 2 wireless minimalist keyboard with Easy-Switch functionality that allows users to connect up to three devices (computers, tablets, or mobile phones), even with different operating systems, and switch between them.
Our competitors for Blue Microphones products include Rode Microphones LLC, Audio Technica Corporation, Samson Technologies Corp., Shure Incorporated, Razer and Apogee Electronics Corp., among others. Intellectual Property and Proprietary Rights Intellectual property rights that apply to Logitech's products and services include patents, trademarks, copyrights, and trade secrets.
("Razer"), Corsair Gaming, Inc., SteelSeries (owned by GN Store Nord A/S (“GN”)), Turtle Beach Corporation and HyperX (owned by HP Inc. ("HP")), among others. Our competitors for Blue Microphones products include Rode Microphones LLC, Audio Technica Corporation, Samson Technologies Corp., Shure Incorporated, Razer and Apogee Electronics Corp., among others. Keyboards & Combos Apple Inc.
The Rugged Folio uses Smart Connector technology to connect to the iPad seamlessly, with no need for batteries or Bluetooth pairing. • The Logitech Slim Folio Keyboard for the iPad Pro 11 and 12.9, bringing a Bluetooth backlit keyboard with a folio design for optimal working and viewing angle, light front and back protection and an Apple Pencil holder.
The Combo Touch line-up uses Smart Connector technology to connect to the iPad seamlessly, with no need for batteries or Bluetooth pairing. • The Rugged line-up offers a more protective folio or combo for iPad 9th and 10th generations, with a securely sealed wipeable fabric keyboard powered by Smart Connector, a rugged and protective holder, and an any-angle kickstand to allow multiple viewing angles.
Our Suzhou operation provides for increased production capacity, manufacturing know-how, IP protection and greater flexibility in responding to product demand. Further, by outsourcing the manufacturing of certain products, we seek to reduce volatility in production volumes as well as improve time to market.
Further, by outsourcing the manufacturing of certain products, we seek to reduce volatility in production volumes as well as improve time to market. Logitech International S.A. | Fiscal 2024 Form 10-K | 7 Table of Contents Both our in-house and outsourced manufacturing operations are managed by our worldwide operations group.
For some of our brands, dedicated support websites and dedicated internal support teams are available. To improve our customers' experience and operate efficiently, we use technology to facilitate chatbot interactions, enable self-help and apply Artificial Intelligence to optimize support searches.
To improve our customers' experience and operate efficiently, we use technology to facilitate chatbot interactions, enable self-help and apply AI to optimize support searches. Logitech provides warranties on our branded products that range from one to three years. For our Video Collaboration category, we also work with channel partners to offer bundled support services with Logitech Video Collaboration solutions.
We continue to focus on ensuring the efficiency of the Suzhou facilities, through the implementation of quality management, automation, process improvements, and employee involvement programs. We outsource the remaining production to contract manufacturers and original design manufacturers located principally in Asia. Both our in-house and outsourced manufacturing operations are managed by our worldwide operations group.
Our Suzhou operation, which currently handles approximately 40% of our total production of products, provides for increased production capacity, manufacturing know-how, intellectual property protection and greater flexibility in responding to product demand. We focus on ensuring the efficiency of the Suzhou facilities through the implementation of quality management, automation, process improvements, and employee involvement programs.
Stewardship : In Europe, Logitech products are regulated by a number of end-of-life stewardship directives including the Waste Electrical and Electronic Equipment (“WEEE”) Directive, the Packaging Directive and the Battery Directive, which require producers of electrical goods, packaging, and batteries to finance the collection, recycling, treatment and disposal of relevant products. Similar legislation exists in many countries worldwide.
We also are subject to numerous environmental regulations, including in connection with targeted substances, such as laws addressing the discharge of pollutants into the air and water, the management and disposal of hazardous substances and wastes, and the cleanup of contaminated sites, the manufacture and distribution of chemical substances and laws restricting the presence of certain substances in electronics products; stewardship, such as end-of-life stewardship directives including the Waste Electrical and Electronic Equipment (WEEE) Directive, the Packaging Directive and the Battery Regulation, which require producers of electrical goods, packaging, and batteries to finance the collection, recycling, treatment and disposal of relevant products; or conflict minerals, such as the U.S.
Beyond e-tailers, retail and distribution channels, we have strengthened other commercial channels in areas such as computer and telecommunications stores, value-added resellers and online merchants. As we have increased our investments in the business-to-business ("B2B") channel, we have expanded our enterprise sales coverage through our sales force as well as various channel partners.
As we have increased our investments in the B2B channel in recent years, we have expanded our enterprise sales coverage through our sales force as well as various channel partners. Expansions into new channels enables more cross-selling opportunities across our broad product portfolio.
PC Webcams: Our PC Webcams category comprises webcams targeted primarily at video conferencing users purchasing for individual use. A key market driver includes people upgrading their work-from-home video conferencing setup. The Logitech HD Pro Webcam C920 and C922 are key products in this category and we recently added Logitech Brio 300 and Brio 500 to the portfolio.
The Logitech HD Pro Webcam C920, C922 and Brio 4K Pro Webcam are key products in this category and we have recently launched our new flagship MX Brio Ultra HD 4K Collaboration and Streaming Webcam. Tablet Accessories Our Tablet Accessories category primarily includes keyboards for tablets.
Removed
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.
Added
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.
Removed
We sell these products through a number of brands: Logitech, Logitech G (including ASTRO Gaming, Streamlabs, and Blue Microphones) and Ultimate Ears.
Added
Business Strategy Logitech's strategy includes the following core priorities: • Work and Play: We plan to expand innovation and growth within Work and Play by selling our current product categories into broader sectors of Work including Retail, Education, and Health Care, and expand into other areas of Play beyond Gaming; • Design-led, software-enabled hardware: We plan to focus on design-led hardware, combined with software and services, that incorporates sustainability; • Business-to-Consumer ("B2C") and Business-to-Business ("B2B"): We plan to maintain focus on performance of our B2C business while accelerating our investment in B2B capabilities, including across product design, services, marketing and sales; • Geographic opportunities: We plan to leverage geographic opportunities and expand our presence; and • Iconic brand: We plan to continue building an iconic Logitech brand.
Removed
Our diverse portfolio includes: • Creativity & Productivity: personal computer ("PC") mice and presentation tools (reported as Pointing Devices), PC keyboards and keyboard/mouse combination products (reported as Keyboards & Combos), PC-based webcams including streaming cameras (reported as PC Webcams), and tablet keyboards and styluses (reported as Tablet & Other Accessories); • Gaming: gaming mice, keyboards, headsets, steering wheels and other control devices, and Streamlabs services; • Video Collaboration: conference cameras for meeting rooms, webcams and headsets; • Music-related products include wireless speakers (reported as Mobile Speakers), and PC speakers, headsets, microphones and earphones (reported as Audio & Wearables).
Added
Environmental Sustainability Logitech considers the environmental and social impacts of our products, operations, and value chain from the sourcing of raw materials through to the end-of-life of our products. We design for sustainability by striving to use innovative materials, technologies and processes that reduce carbon emissions and elevate circular solutions.
Removed
Business Strategy Logitech's foundation for future growth is built on five core capabilities that apply to all of our product categories: • Design; • Engineering; • Go-to-market; • Marketing; and • Operations. Design Over the past decade, Logitech has reinvented itself as a design company, whereby design-led engineering is used as a strategic differentiator.
Added
We have started to transition our manufacturing and supply chain to renewable energy and we aim to eliminate waste and extend the life of products. Logitech also actively supports the use of recycled materials and component recovery for reuse, as well as product repair and recycling, in order to address the need for conservation of natural resources.
Removed
In addition, design significantly impacts Logitech’s efforts to improve outcomes for all people and the planet through a program we call Design for Sustainability. All of this work has been recognized through various awards: in fiscal year 2023, we were honored with 116 design awards.
Added
The Logitech Wireless Combo MK295 Silent is an upgraded version with silent typing and clicking due to our SilentTouch technology. • The Logitech MX Keys Wireless keyboard, a premium backlit keyboard with customizable keys to directly access menus and shortcuts within leading creativity and productivity apps.
Removed
Our engineering team has expertise in bringing together these many technologies, across hardware and software to develop an innovative portfolio. These engineering capabilities combined with our award-winning design team form the basis of Logitech's key innovation engine.
Added
Webcams Our Webcams category includes PC-based webcams that are targeted primarily at consumers, including streaming cameras, and VC webcams that turn any desktop into an instant collaboration space. Our webcams are targeted primarily at video conferencing users purchasing for individual use.
Removed
Expansions into new channels also bring numerous cross-selling opportunities across our broad product portfolio. Marketing Across Logitech’s multiple categories, we focus on enhancing our marketing capabilities around brand strategy and execution, digital marketing, and marketing technology.
Added
Key market drivers include upgrades of work-from-home video conferencing setups and purchase of webcams to create and share content via such platforms as YouTube, Twitch or TikTok.

… 62 more changes not shown on this page.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

80 edited+21 added−11 removed159 unchanged
Biggest changeThere are risks inherent in doing business in international markets, including: • Difficulties in staffing and managing international operations; • Compliance with increasing amounts of laws and regulations, including environmental, tax, import/export and anti-corruption laws, which vary from country to country, and the European Union legislation, and over time, increasing the costs of compliance and potential risks of non-compliance; • Varying laws, regulations and other legal protections, uncertain and varying enforcement of those laws and regulations, dependence on local authorities, and the importance of local networks and relationships; • Varying accounting, auditing and financial reporting standards, accountability and protections, including risks related to the lack of access by the Public Company Accounting Oversight Board (United States) ("PCAOB") to inspect PCAOB-registered accounting firms in emerging market countries such as China; • Exposure to political, economic and financial instability, including due to the uncertainty associated with the ongoing sovereign debt issues in certain Euro zone countries, which may lead to reduced sales, currency exchange losses and collection difficulties or other losses; Logitech International S.A. | Fiscal 2023 Form 10-K | 23 Table of Contents • Import or export restrictions or licensing requirements that could affect some of our products, including those with encryption technology; • Trade protection measures, custom duties, tariffs, import or export duties, and other trade barriers, restrictions and regulations, including recent and ongoing United States - China tariffs and trade restrictions, including China's 2021 Anti-Foreign Sanctions Law; • Lack of infrastructure or services necessary or appropriate to support our products and services; • Effects of the COVID-19 pandemic that may be more concentrated where we operate internationally; • Exposure to fluctuations in the value of local currencies; • Difficulties and increased costs in establishing sales and distribution channels in unfamiliar markets, with their own market characteristics and competition, including entrenched local competition; • Weak protection of our intellectual property rights; • Higher credit risks; • Variations in VAT (value-added tax) or VAT reimbursement; • Imposition of currency exchange controls; • Delays from customs brokers or government agencies; and • A broad range of customs, consumer trends, and more.
Biggest changeThere are risks inherent in doing business in international markets, including: • Difficulties in staffing and managing international operations; • Compliance with increasing amounts of laws and regulations, including environmental, tax, import/export and anti-corruption laws, which vary from country to country, and the European Union legislation, and over time, increasing the costs of compliance and potential risks of non-compliance; • Varying laws, regulations and other legal protections, uncertain and varying enforcement of those laws and regulations, dependence on local authorities, and the importance of local networks and relationships; • Varying accounting, auditing and financial reporting standards, accountability and protections, including risks related to the lack of access by the Public Company Accounting Oversight Board (United States) ("PCAOB") to inspect PCAOB-registered accounting firms in emerging market countries such as China; • Exposure to political, economic and financial instability, including due to the uncertainty associated with the ongoing sovereign debt issues in certain Euro zone countries, which may lead to reduced sales, currency exchange losses and collection difficulties or other losses; • Import or export restrictions or licensing requirements that could affect some of our products, including those with encryption technology; • Trade protection measures, custom duties, tariffs, import or export duties, and other trade barriers, restrictions and regulations, including recent and ongoing United States - China tariffs and trade restrictions, including China's 2021 Anti-Foreign Sanctions Law; • Lack of adequate infrastructure or services necessary or appropriate to support our long-term business strategy, digital transformation and operational efficiency; • Exposure to fluctuations in the value of local currencies; • Difficulties and increased costs in establishing sales and distribution channels in unfamiliar markets, with their own market characteristics and competition, including entrenched local competition; • Weak protection of our intellectual property rights; • Higher credit risks; • Current and future international regulation of AI; • Variations in VAT (value-added tax) or VAT reimbursement; • Imposition of currency exchange controls; Logitech International S.A. | Fiscal 2024 Form 10-K | 24 Table of Contents • Delays from customs brokers or government agencies; and • A broad range of customs, consumer trends, and more.
Further, we have been exposed in the past and may be exposed to fluctuations in the value of the local currency in the countries in which manufacturing occurs. Future appreciation of these local currencies could increase our component and other raw material costs.
Further, we have been exposed in the past and may in the future be exposed to fluctuations in the value of the local currency in the countries in which manufacturing occurs. Future appreciation of these local currencies could increase our component and other raw material costs.
In addition, we rely on channel inventory data from our sales channel partners. If we do not receive this information on a timely and accurate basis, if this information is not accurate, or if we do not properly interpret this information, our results of operations and financial condition may be adversely affected.
In addition, we rely on channel inventory data from our sales channel partners. If we do not receive this information on a timely basis, if this information is not accurate, or if we do not properly interpret this information, our results of operations and financial condition may be adversely affected.
Our effective income tax rate may be affected by changes in or interpretations of tax laws, treaties, rulings, regulations or agreements in any given jurisdiction, or changes in international tax reform by the Organization for Economic Co-operation and Development and similar organizations, utilization of net operating loss and tax credit carryforwards, changes in geographical allocation of income and expense, and changes in management’s assessment of matters such as the realizability of deferred tax assets.
Our effective income tax rate may be affected by changes in or interpretations of tax laws, treaties, rulings, regulations or agreements in any given jurisdiction, or changes in international tax reform by the Organization for Economic Co-operation and Development (the "OECD") and similar organizations, utilization of net operating loss and tax credit carryforwards, changes in geographical allocation of income and expense, and changes in management’s assessment of matters such as the realizability of deferred tax assets.
In addition, Microsoft, Apple, Google, Amazon or other competitors may be able to control distribution channels or offer pricing advantages on bundled hardware and software products that we may not be able to offer, and maybe financially positioned to exert significant downward pressure on product prices and upward pressure on promotional incentives in order to gain market share.
In addition, Microsoft, Apple, Google, Amazon or other competitors may be able to control distribution channels or offer pricing advantages on bundled hardware and software products that we may not be able to offer, and may be financially positioned to exert significant downward pressure on product prices and upward pressure on promotional incentives in order to gain market share.
Our success largely depends on our ability to manage, hire, retain, integrate and motivate sufficient numbers of qualified personnel, including senior leadership. Our strategy and our ability to innovate, design and produce new products, sell products, maintain operating margins and control expenses depend on key personnel that may be difficult to replace.
Our success largely depends on our ability to manage, hire, retain, integrate and motivate sufficient numbers of qualified personnel, including senior leadership. Our strategy and our ability to innovate, design and produce new products, market and sell products, maintain operating margins and control expenses depend on key personnel that may be difficult to replace.
As a result of the reform, Logitech will incur cash income taxes that will increase over time as the deferred income tax benefit established in connection with the reform diminishes.
As a result of the TRAF reform, Logitech will incur cash income taxes that will increase over time as the deferred income tax benefit established in connection with the reform diminishes.
Our share repurchase programs and dividend policy may be affected by many factors, including general business and economic conditions, our financial condition and operating results, our views on potential future capital requirements, restrictions imposed in any future debt agreements, the emergence of alternative investment or acquisition opportunities, changes in our business strategy, legal requirements, changes in tax laws, and other factors.
Our share repurchase program and dividend policy may be affected by many factors, including general business and economic conditions, our financial condition and operating results, our views on potential future capital requirements, restrictions imposed in any future debt agreements, the emergence of alternative investment or acquisition opportunities, changes in our business strategy, legal requirements, changes in tax laws, and other factors.
If the supply of these products or key components were to be delayed or constrained, impacted by global shortages of semiconductor chips, or if one or more of our single-source suppliers experience disruptions or go out of business as a result of adverse global economic conditions, natural disasters or regional or global pandemics, including COVID-19, we might be unable to find a new supplier on acceptable terms, or at all, and our product shipments to our customers could be delayed, which could adversely affect our business, financial condition and operating results.
If the supply of these products or key components were to be delayed or constrained, impacted by global shortages of semiconductor chips, or if one or more of our single-source suppliers experience disruptions or go out of business as a result of adverse global economic conditions, adverse global or regional geopolitical conditions, natural disasters or regional or global pandemics, such as COVID-19, we might be unable to find a new supplier on acceptable terms, or at all, and our product shipments to our customers could be delayed, which could adversely affect our business, financial condition and operating results.
As a result, our revenues in any quarter depend primarily on orders booked and shipped in that quarter. • A significant portion of our quarterly retail sales typically occurs in the last weeks of each quarter, further increasing the difficulty in predicting quarterly revenues and profitability. • Our sales are impacted by consumer demand and current and future global economic and political conditions, including inflation, foreign currency fluctuations, slowdown of economic activity around the world, in part due to rising interest rates, and lower consumer and enterprise spending, trade restrictions and tariffs, and can, therefore, fluctuate abruptly and significantly during periods of uncertain economic conditions or geographic distress, as well as from shifts in distributor inventory practices and consumer buying patterns. • We must incur a large portion of our costs in advance of sales orders because we must plan research and production, order components, buy tooling equipment, and enter into development, sales and marketing, and other operating commitments prior to obtaining firm commitments from our customers.
As a result, our revenues in any quarter depend primarily on orders booked and shipped in that quarter. • A significant portion of our quarterly retail sales typically occurs in the last weeks of each quarter, further increasing the difficulty in predicting quarterly revenues and profitability. • Our sales are impacted by consumer demand and current and future global economic and political conditions, including inflation, interest rate and foreign currency fluctuations, slowdown of economic activity around the world, and lower consumer and enterprise spending, trade restrictions and tariffs, and can, therefore, fluctuate abruptly and significantly during periods of uncertain economic conditions or geographic distress, as well as from shifts in distributor inventory practices and consumer buying patterns. • We must incur a large portion of our costs in advance of sales orders because we must plan research and production, order components, buy tooling equipment, and enter into development, sales and marketing, and other operating commitments prior to obtaining firm commitments from our customers.
In recent years, the U.S. government has instituted or proposed changes to international trade policy through the renegotiation, and potential termination, of certain existing bilateral or multilateral trade agreements and treaties with, and the imposition of tariffs on a wide range of products and other goods from, China, countries in EMEA and other countries.
The U.S. government has instituted or proposed changes to international trade policy through the renegotiation, and potential termination, of certain existing bilateral or multilateral trade agreements and treaties with, and the imposition of tariffs on a wide range of products and other goods from, China, countries in EMEA and other countries.
See also the other information set forth in this Annual Report on Form 10-K, including in Part I, Item 1 "Business," Part II, Item 7 "Management’s Discussion and Analysis of Financial Condition and Results of Operations" and our Consolidated Financial Statements and the related Notes.
See also the other information set forth in this Annual Report on Form 10-K, including in Part I, Item 1 "Business," Part II, Item 1C "Cybersecurity", Item 7 "Management’s Discussion and Analysis of Financial Condition and Results of Operations" and our Consolidated Financial Statements and the related Notes.
The success of our product portfolio depends on several factors, including our ability to: • Identify new features, functionality and opportunities; • Anticipate technology, market trends and consumer preferences; • Develop innovative, high-quality, and reliable new products and enhancements in a cost-effective and timely manner; • Distinguish our products from those of our competitors; and • Offer our products at prices and on terms that are attractive to our customers and consumers.
The success of our product portfolio depends on several factors, including our ability to: • Identify new features, functionality and opportunities; • Anticipate technology, market trends and consumer preferences; • Develop innovative, high-quality, and reliable new software-enabled hardware products and enhancements in a cost-effective and timely manner; • Distinguish our products from those of our competitors; and • Offer our products at prices and on terms that are attractive to our customers and consumers.
As we continue our efforts to lower our costs and improve our operational efficiency, we may not fully realize our goals.
As we continue our efforts to scale, lower our costs and improve our operational efficiency, we may not fully realize our goals.
Any announcement of termination or suspension of our share repurchase programs or dividend may result in a decrease in our share price. The share repurchase programs and payment of cash dividends could also diminish our cash reserves that may be needed for investments in our business, acquisitions or other purposes.
Any announcement of termination or suspension of our share repurchase program or dividend may result in a decrease in our share price. The share repurchase program and payment of cash dividends could also diminish our cash reserves that may be needed for investments in our business, acquisitions or other purposes.
If we fail to accurately anticipate technological trends or our users’ needs or preferences, are unable to complete the development of products and services in a cost-effective and timely fashion or are unable to appropriately increase production to fulfill customer demand, we will be unable to successfully introduce new products and services into the market or compete with other providers.
If we fail to accurately anticipate technological trends or our users’ needs or preferences, are unable to complete the development of software-enabled hardware products and services in a cost-effective and timely fashion or are unable to appropriately increase production to fulfill customer demand, we will be unable to successfully introduce new products and services into the market or compete with other providers.
While we have developed and implemented security measures and processes designed to protect against cyber and other security threats, such measures cannot provide absolute security and may not be successful in preventing future security breaches.
While we have developed and implemented security measures and processes designed to protect against cyber and other security threats, such measures cannot provide absolute security and may not be successful in preventing all security breaches.
We use and store confidential information, including but not limited to our business, financial, legal and governance information, as well as personal information about our employees, members of our Board of Directors and customers.
We use and store confidential information, including but not limited to our business, financial, legal and governance information, as well as personal information about our employees, members of our Board of Directors, customers, and other business partners.
Dollar-denominated sales and earnings. Competitive conditions in the markets in which we operate may also limit our ability to increase prices in the event of fluctuations in currency exchange rates. Conversely, strengthening of currency rates may also increase our product component costs and other expenses denominated in those currencies, adversely affecting operating results.
Competitive conditions in the markets in which we operate may also limit our ability to increase prices in the event of fluctuations in currency exchange rates. Conversely, strengthening of currency rates may also increase our product component costs and other expenses denominated in those currencies, adversely affecting operating results.
As we expand into new markets and product categories and acquire companies, businesses and assets, we must comply with a wide variety of laws, standards and other requirements governing, among other things, health and safety, hazardous materials usage, product-related energy consumption, conflict minerals, packaging, recycling, sustainability, environmental, child labor and human rights matters.
As we expand into new markets and product categories and acquire companies, businesses and assets, our operations and products must comply with a wide variety of laws, standards and other requirements governing, among other things, health and safety, hazardous materials usage, product-related energy consumption, conflict minerals, packaging, recycling, sustainability, environmental, child labor and human rights matters, among others.
Our product portfolio includes current and future products designed for use with third-party platforms or software, such as the Apple iPad, iPod, iPhone and Siri, Android phones and tablets, Google Assistant and Amazon Alexa . Our business in these categories relies on our access to the platforms of third parties, some of whom are our competitors.
Our product portfolio includes current and future products designed for use with third-party platforms or software, such as the Apple iPad, iPhone and Siri, Android phones and tablets, Google Assistant, Zoom, Microsoft Teams and Amazon Alexa . Our business in these categories relies on our access to the platforms of third parties, some of whom are our competitors.
A significant portion of our business is conducted in currencies other than the U.S. Dollar. Therefore, we face exposure to movements in currency exchange rates. Our primary exposure to movements in currency exchange rates relates to non-U.S. Dollar-denominated sales and operating expenses worldwide. For fiscal year 2023, approximately 51% of our revenue was in non-U.S. denominated currencies.
A significant portion of our business is conducted in currencies other than the U.S. Dollar. Therefore, we face exposure to movements in currency exchange rates. Our primary exposure to movements in currency exchange rates relates to non-U.S. Dollar-denominated sales and operating expenses worldwide. For fiscal year 2024, approximately 50% of our revenue was in non-U.S. denominated currencies.
As a result, changes in trade policy and regulations in the United States and other countries as well as changes in trade agreements and tariffs and sanctions imposed on Russia could adversely affect our business, results of operations and financial condition. Our financial performance is subject to risks associated with fluctuations in currency exchange rates.
As a result, changes in trade policy and regulations in the United States and other countries as well as changes in trade agreements and tariffs could adversely affect our business, results of operations and financial condition. Our financial performance is subject to risks associated with fluctuations in currency exchange rates.
As a result of the Federal Act on the Tax Reform and AHV Financing (“TRAF”), the canton of Vaud in Switzerland, where we are incorporated, enacted tax reforms on March 10, 2020 that took effect as of January 1, 2020.
For example, as a result of the Federal Act on the Tax Reform and AHV Financing (“TRAF”), the canton of Vaud in Switzerland, where we are incorporated, enacted tax reforms that took effect as of January 1, 2020.
Summary of Risk Factors Risks Related to our Business • If we fail to innovate and develop new products in a timely and cost-effective manner for our new and existing product categories, our business and operating results could be adversely affected. • If we do not successfully execute on our growth opportunities, or if our growth opportunities are more limited than we expect, our operating results and future growth could be adversely affected. • We purchase key components and products from a limited number of sources, and our business and operating results could be adversely affected if supply were delayed or constrained or if there were shortages of required components. • Our principal manufacturing operations and third-party contract manufacturers are located in China and Southeast Asia, which exposes us to risks associated with doing business in that geographic area as well as potential tariffs, adverse trade regulations, adverse tax consequences and pressure to move or diversify our manufacturing locations. • If we do not successfully coordinate the worldwide manufacturing and distribution of our products, we could lose sales and our business and operating results could be adversely affected. • If we are not able to maintain and enhance our brands, or if our brands or reputation are damaged, our reputation, business and operating results could be adversely affected. • If we do not compete effectively, demand for our products could decline and our business and operating results could be adversely affected. • We rely on third parties to sell and distribute our products, and we rely on their information to manage our business.
Summary of Risk Factors Risks Related to our Business • If we fail to innovate and develop new products in a timely and cost-effective manner for our new and existing product categories, our business and operating results could be adversely affected. • We use artificial intelligence ("AI") in our business, and challenges relating to the development and use of AI, including generative AI, could result in competitive harm, reputational harm, and legal liability, and adversely affect our results of operations. • If we do not successfully execute on our growth opportunities, or if our growth opportunities are more limited than we expect, our operating results and future growth could be adversely affected. • We purchase key components and products from a limited number of sources, and our business and operating results could be adversely affected if supply were delayed or constrained or if there were shortages of required components. • Our principal manufacturing operations and third-party contract manufacturers are located in China and Southeast Asia, which exposes us to risks associated with doing business in that geographic area as well as potential tariffs, adverse trade regulations, adverse tax consequences and pressure to move or diversify our manufacturing locations. • If we do not successfully coordinate the worldwide manufacturing and distribution of our products, we could lose sales and our business and operating results could be adversely affected. • If we are not able to maintain and enhance our brands, or if our brands or reputation are damaged, our reputation, business and operating results could be adversely affected. • If we do not compete effectively, demand for our products could decline and our business and operating results could be adversely affected. • We rely on third parties to sell and distribute our products, and we rely on their information to manage our business.
Risks Related to Confidential Information, Cybersecurity, Privacy, and Intellectual Property • Losses or unauthorized access to or releases of confidential information could adversely affect our business and result in significant reputational, financial and legal consequences. • The collection, storage, transmission, use and distribution of personal data could give rise to liabilities and additional costs of operation as a result of laws, governmental regulation and risks of data breaches and security incidents. • Claims by others that we infringe their proprietary technology could adversely affect our business.
Risks Related to Confidential Information, Cybersecurity, Privacy, and Intellectual Property • Losses or unauthorized access to or releases of confidential information could adversely affect our business and result in significant reputational, financial and legal consequences. • The collection, storage, transmission, use and distribution of personal data could give rise to liabilities and additional costs of operation as a result of laws, governmental regulation and risks of data breaches and security incidents.
In addition, while we carry cyber insurance, we cannot be certain that our insurance will be sufficient to cover losses and liabilities resulting from cyberattacks, security breaches and incidents, or other interruptions, that insurance will continue to be available to us on economically reasonable terms, or at all, or that any insurer will not deny coverage as to any future claim, any of which could have a material adverse effect on our business, including our financial condition, results of operations and reputation.
Logitech International S.A. | Fiscal 2024 Form 10-K | 28 Table of Contents In addition, while we carry cyber insurance, we cannot be certain that our insurance will be sufficient to cover losses and liabilities resulting from cyberattacks, security breaches and incidents, or other interruptions, that insurance will continue to be available to us on economically reasonable terms, or at all, or that any insurer will not deny coverage as to any future claim, any of which could have a material adverse effect on our business, including our financial condition, results of operations and reputation.
Disruption of our relationship with these channel partners, changes in or issues with their business practices, their failure to provide timely and accurate information, changes in distribution partners, practices or models, conflicts among our channels of distribution, or failure to build and scale our own sales force for certain product categories and enterprise channel partners could adversely affect our business, results of operations, operating cash flows and financial condition. • If we do not accurately forecast market demand for our products, our business and operating results could be adversely affected. • Our business depends in part on access to third-party platforms or technologies, and if access thereto is withdrawn, denied, or is not available on terms acceptable to us, or if the platforms or technologies change without notice to us, our business and operating results could be adversely affected. • Our success largely depends on our ability to manage, hire, retain, integrate and motivate sufficient numbers of qualified personnel, including senior leadership.
Disruption of our relationship with these channel partners, changes in or issues with their business practices, their failure to provide timely and accurate information, changes in distribution partners, practices or models, conflicts among our channels of distribution, or failure to build and scale our own sales force for certain product categories and enterprise channel partners could adversely affect our business, results of operations, operating cash flows and financial condition. • If we do not accurately forecast market demand for our products, our business and operating results could be adversely affected. • Our business depends in part on access to third-party platforms or technologies, and if access thereto is withdrawn, denied, or is not available on terms acceptable to us, or if the platforms or technologies change without notice to us, our business and operating results could be adversely affected.
Logitech International S.A. | Fiscal 2023 Form 10-K | 26 Table of Contents As a result of changes in tax laws, treaties, rulings, regulations or agreements, or their interpretation, of Switzerland or any other country in which we operate, the loss of a major tax dispute or a successful challenge to our operating structure, intercompany pricing policies or the taxable presence of our key subsidiaries in certain countries, or other factors, our effective income tax rates may increase, which could adversely affect our net income and cash flows.
As a result of changes in tax laws, treaties, rulings, regulations or agreements, or their interpretation, of Switzerland or any other country in which we operate, the loss of a major tax dispute or a successful challenge to our operating structure, intercompany pricing policies or the taxable presence of our key subsidiaries in certain countries, or other factors, our effective income tax rates may increase, which could adversely affect our net income and cash flows.
Dollar-denominated countries and on sales of products that include components obtained from suppliers in non-U.S. Dollar-denominated countries could be adversely affected by currency exchange rate fluctuations. In some circumstances, for competitive or other reasons, we may decide not to raise local prices to fully offset the U.S. Dollar’s strengthening, which would adversely affect the U.S. Dollar value of our non-U.S.
Dollar-denominated countries could be adversely affected by currency exchange rate fluctuations. In some circumstances, for competitive or other reasons, we may decide not to raise local prices to fully offset the U.S. Dollar’s strengthening, which would adversely affect the U.S. Dollar value of our non-U.S. Dollar-denominated sales and earnings.
While our overall distribution relationships are diffuse, in fiscal year 2023 and 2022 our gross sales were concentrated with three customers - Amazon Inc., Ingram Micro and TD Synnex - and their affiliated entities. We do not have long-term commitments with those customers.
While our overall distribution relationships are diffuse, in fiscal years 2024 and 2023 ou r gross sales were concentrated with three customers - Amazon, Ingram Micro and TD Synnex - and their affiliated entities. We do not have long-term commitments with those customers.
As we do so, we face an increased risk that claims alleging we infringe the patent or other intellectual property rights of others, regardless of the merit of the claims, may increase in number and significance.
As we do so, we face an increased risk that claims alleging we infringe the patent or other intellectual property rights of others, including as a result of our use of AI, and regardless of the merit of the claims, may increase in number and significance.
If online sales grow as a percentage of overall sales, we expect that we will become even more reliant on Amazon. While we believe that we have good relationships with Amazon, Ingram Micro and TD Synnex, any adverse change in those relationships could have an adverse impact on our results of operations and financial condition.
If online sales grow as a percentage of overall sales, we expect that our reliance on Amazon would increase. While we believe that we have good relationships with Amazon, Ingram Micro and TD Synnex, any adverse change in those relationships could have an adverse impact on our results of operations and financial condition.
Premature announcements or leaks of new products, features or technologies may exacerbate some of these risks by reducing the effectiveness of our product launches, reducing sales volumes of current products due to anticipated future products, making it more difficult to Logitech International S.A. | Fiscal 2023 Form 10-K | 16 Table of Contents compete, shortening the period of differentiation based on our product innovation, straining relationships with our partners or increasing market expectations for the results of our new products before we have had an opportunity to demonstrate the market viability of the products.
Premature announcements or leaks of new products, features or technologies may exacerbate some of these risks by reducing the effectiveness of our product launches, reducing sales volumes of current products due to anticipated future products, making it more difficult to compete, shortening the period of differentiation based on our product innovation, straining relationships with our partners or increasing market expectations for the results of our new products before we have had an opportunity to demonstrate the market viability of the products.
As we introduce new or enhanced products, integrate new technology into new or existing products, or reduce the overall number of products offered, we face risks including, among other things, disruption in customers’ ordering patterns, excessive levels of new and existing product inventories, revenue deterioration in our existing product lines, insufficient supplies of new products to meet customers’ demand, possible product and technology defects, and a potentially different sales and support environment.
As we introduce new or enhanced products, integrate new technology into new or existing products, or reduce the overall number of products offered, we face risks including, among other things, disruption in customers’ ordering patterns, excessive levels of new and existing product inventories, revenue deterioration in our existing product lines, insufficient supplies of new products to meet customers’ demand, possible product and technology Logitech International S.A. | Fiscal 2024 Form 10-K | 16 Table of Contents defects, and a potentially different sales and support environment.
Unauthorized use of our technology may result in the development of products that compete with our products. Our future success depends in part on our proprietary technology, technical know-how and other intellectual property.
We may be unable to protect our proprietary rights. Unauthorized use of our technology may result in the development of products that compete with our products. Our future success depends in part on our proprietary technology, technical know-how and other intellectual property.
Our manufacturing operations at third-party contractors could be adversely affected by contractual disagreements, by labor unrest, by natural disasters, by regional or global pandemics, such as the COVID-19 pandemic, by wars and armed conflicts, by strains on local communications, trade, and other infrastructures, by competition for the available labor pool or manufacturing capacity, by increasing labor and other costs, and by other trade customs and practices that are dissimilar to those in the United States and Europe.
Logitech International S.A. | Fiscal 2024 Form 10-K | 18 Table of Contents Our manufacturing operations at third-party contractors could be adversely affected by contractual disagreements, by labor unrest, by natural disasters, by regional or global pandemics, such as the COVID-19 pandemic, by wars and armed conflicts, by strains on local communications, trade, and other infrastructures, by competition for the available labor pool or manufacturing capacity, by increasing labor and other costs, and by other trade customs and practices that are dissimilar to those in the United States and Europe.
Any loss of a major partner or distribution channel or other Logitech International S.A. | Fiscal 2023 Form 10-K | 19 Table of Contents channel disruption could make us more dependent on alternate channels, increase pricing and promotional pressures from other partners and distribution channels, increase our marketing costs, or adversely impact buying and inventory patterns, payment terms or other contractual terms, sell-through or delivery of our products to consumers, our reputation and brand equity, or our market share.
Any loss of a major partner or distribution channel or other channel disruption could make us more dependent on alternate channels, increase pricing and promotional pressures from other partners and distribution channels, increase our marketing costs, or adversely impact buying and inventory patterns, payment terms or other contractual terms, sell-through or delivery of our products to consumers, our reputation and brand equity, or our market share.
In addition, our growth and increased frequency and sophistication of cyber and product security attacks may increase the likelihood of our becoming a target of complex and damaging attacks that substantially disrupt operations and expose sensitive data.
In addition, our growth and increased frequency and sophistication of cyber and product security attacks, especially leveraging "deepfakes" and other AI techniques may increase the likelihood of us becoming a target of complex and damaging attacks that substantially disrupt operations and expose sensitive data.
Some of these growth categories and opportunities are also characterized by short product cycles, frequent new product introductions and enhancements and rapidly changing and evolving consumer preferences with respect to design and features that require calculated risk-taking and fast responsiveness and result in short opportunities to establish a market presence.
Some of these growth categories and opportunities are also characterized by short product cycles, frequent new product Logitech International S.A. | Fiscal 2024 Form 10-K | 17 Table of Contents introductions and enhancements and rapidly changing and evolving consumer preferences with respect to design and features that require calculated risk-taking and fast responsiveness and result in short opportunities to establish a market presence.
Companies must develop an expanded set of metrics and measures, data collection and processing, controls, and reporting processes in order to meet regulatory requirements and stakeholder expectations. Failure to promptly and accurately meet these expectations and requirements may result in reputational and brand damage, regulatory penalties and litigation among other things.
As a result, companies are required to develop an expanded set of metrics and measures, as well as data collection, controls, and reporting processes in order to meet regulatory requirements and stakeholder expectations. Failure by us to promptly and accurately meet these expectations and requirements may expose us to reputational and brand damage, regulatory penalties and litigation among other things.
As we expand the number of platforms and software applications with which our products are compatible, we may not be successful in launching products for those platforms or software applications, we may not be successful in establishing strong relationships with the new platform or software owners, or we may negatively impact our ability to develop and produce high-quality products on a timely basis for those platforms and software applications or we may otherwise adversely affect our relationships with existing platform or software owners.
If we expand the number of platforms and software applications with which our products are compatible, we may not be successful in launching Logitech International S.A. | Fiscal 2024 Form 10-K | 21 Table of Contents products for those platforms or software applications, we may not be successful in establishing strong relationships with the new platform or software owners, or we may negatively impact our ability to develop and produce high-quality products on a timely basis for those platforms and software applications or we may otherwise adversely affect our relationships with existing platform or software owners.
As a result, fluctuations in currency exchange rates could affect and have in the past adversely affected our business, operating results and financial condition. Moreover, these exposures may change over time. Logitech International S.A. | Fiscal 2023 Form 10-K | 25 Table of Contents We are subject to risks related to our environmental, social and governance ("ESG") activities and disclosures.
As a result, fluctuations in currency exchange rates could affect and have in the past adversely affected our business, operating results and financial condition. Moreover, these exposures may change over time. We are subject to risks related to our environmental, social and governance ("ESG") activities and disclosures.
Acquisitions could also result in the assumption of known and unknown liabilities, product, regulatory and other compliance issues, dilutive issuances of our equity securities, the incurrence of debt, disputes over earn-outs or other litigation, and adverse effects on relationships with our and our target’s employees, customers and suppliers.
Acquisitions could also result in the assumption of known and unknown liabilities, product, regulatory and other compliance issues, dilutive issuances of our equity securities, the incurrence of debt, disputes over earn-outs or other litigation, and adverse effects on relationships with our and our target’s Logitech International S.A. | Fiscal 2024 Form 10-K | 22 Table of Contents employees, customers and suppliers.
Logitech International S.A. | Fiscal 2023 Form 10-K | 17 Table of Contents Our principal manufacturing operations and third-party contract manufacturers are located in China and Southeast Asia, which exposes us to risks associated with doing business in that geographic area as well as potential tariffs, adverse trade regulations, adverse tax consequences and pressure to move or diversify our manufacturing locations.
Our principal manufacturing operations and third-party contract manufacturers are located in China and Southeast Asia, which exposes us to risks associated with doing business in that geographic area as well as potential tariffs, adverse trade regulations, adverse tax consequences and pressure to move or diversify our manufacturing locations.
Our brands and reputation are also dependent on third parties, such as suppliers, manufacturers, distributors, retailers, product Logitech International S.A. | Fiscal 2023 Form 10-K | 18 Table of Contents reviewers and the media as well as online consumer product reviews, consumer recommendations and referrals. It can take significant time, resources and expense to overcome negative publicity, reviews or perception.
Our brands and reputation are also dependent on third parties, such as suppliers, manufacturers, distributors, retailers, product reviewers and the media as well as online consumer product reviews, consumer recommendations and referrals. It can take significant time, resources and expense to overcome negative publicity, reviews or perception.
In addition to the extra costs and regulatory burdens of our dual regulatory obligations, the two regulatory regimes may not always be compatible and may impose disclosure obligations, operating restrictions or tax effects on our business to which our competitors and other companies are not subject.
In addition to the extra costs and regulatory burdens of our dual regulatory obligations, the two regulatory regimes may Logitech International S.A. | Fiscal 2024 Form 10-K | 26 Table of Contents not always be compatible and may impose disclosure obligations, operating restrictions or tax effects on our business to which our competitors and other companies are not subject.
If our effective income tax rate increases in future periods, our net income and cash flows could be adversely affected. We maintain cash and cash equivalents at financial institutions and are exposed to credit risk in the event of default by such financial institutions.
If our effective income tax rate increases in future periods, our net income and cash flows could be adversely affected. Logitech International S.A. | Fiscal 2024 Form 10-K | 27 Table of Contents We maintain cash and cash equivalents at financial institutions and are exposed to credit risk in the event of default by such financial institutions.
Logitech International S.A. | Fiscal 2023 Form 10-K | 15 Table of Contents • We may be unable to protect our proprietary rights. Unauthorized use of our technology may result in the development of products that compete with our products.
Logitech International S.A. | Fiscal 2024 Form 10-K | 15 Table of Contents • Claims by others that we infringe their proprietary technology could adversely affect our business. • We may be unable to protect our proprietary rights. Unauthorized use of our technology may result in the development of products that compete with our products.
As previously disclosed, we have invested significantly in manufacturing facilities in China and Southeast Asia. Given our manufacturing principally in those countries, and our lack of manufacturing elsewhere, policy or regulations changes in the United States or other countries present particular risks for us. We are constantly evaluating our manufacturing footprint globally including beyond Asia.
As discussed in this Annual Report on Form 10-K, we have invested significantly in manufacturing facilities in China and Southeast Asia. Given our manufacturing principally in those countries, policy or regulations changes in the United States or other countries present particular risks for us. We are constantly evaluating our manufacturing footprint globally including beyond Asia.
Privacy Shield and we are now required to put in place additional privacy Logitech International S.A. | Fiscal 2023 Form 10-K | 28 Table of Contents protective measures for transfer of data of people in the European Union to certain countries outside of the European Economic Area. In the United States, several states have adopted broad privacy laws.
Privacy Shield and we are now required to put in place additional privacy protective measures for transfer of data of people in the European Union to certain countries outside of the European Economic Area. In the United States, several states have adopted broad privacy laws.
Our strategy and our ability to innovate, design Logitech International S.A. | Fiscal 2023 Form 10-K | 14 Table of Contents and produce new products, sell products, maintain operating margins and control expenses depend on key personnel that may be difficult to replace. • As we focus on growth opportunities, we are divesting or discontinuing non-strategic product categories, or pursuing strategic acquisitions and investments, which could have an adverse impact on our business. • As we continue our efforts to lower our costs and improve our operational efficiency, we may not fully realize our goals. • Product quality issues could adversely affect our reputation, business and operating results.
Our strategy and our ability to innovate, design and produce new products, market and sell products, maintain operating margins and control expenses depend on key personnel that may be difficult to replace. • As we focus on growth opportunities, we may divest or discontinue non-strategic product categories, or pursue strategic acquisitions and investments, which could have an adverse impact on our business. • As we continue our efforts to scale, lower our costs and improve our operational efficiency, we may not fully realize our goals. • Product quality issues could adversely affect our reputation, business and operating results.
There also are risks associated with retaliatory tariffs and resulting trade wars. We cannot predict future trade policy and regulations in the United States and other countries, the terms of any renegotiated trade agreements or treaties, or tariffs and their impact on our business. A trade war could have a significant adverse effect on world trade and the world economy.
New or increased tariffs could adversely affect more or all of our products. There also are risks associated with retaliatory tariffs and resulting trade wars. We cannot predict future trade policy and regulations in the United States and other countries, the terms of any renegotiated trade agreements or treaties, or tariffs and their impact on our business.
In addition, our competitors may offer customers terms and conditions that may be more favorable than our terms and conditions and may require us to take actions to maintain or increase our customer incentive programs, which could impact our revenues and operating margins.
In addition, our competitors may offer customers terms Logitech International S.A. | Fiscal 2024 Form 10-K | 19 Table of Contents and conditions that may be more favorable than our terms and conditions and may require us to take actions to maintain or increase our customer incentive programs, which could impact our revenues and operating margins.
The weakening of currencies relative to the U.S. Dollar adversely affects the U.S. Dollar value of our non-U.S. Dollar-denominated sales and earnings. If we raise international pricing to compensate, it could potentially reduce demand for our products, adversely affecting our sales and potentially having an adverse impact on our market share. Margins on sales of our products in non-U.S.
If we raise international pricing to compensate, it could potentially reduce demand for our products, adversely affecting our sales and potentially having an adverse impact on our market share. Margins on sales of our products in non-U.S. Dollar-denominated countries and on sales of products that include components obtained from suppliers in non-U.S.
In addition, as a consumer electronics company, our websites are an important presentation of our company, identity and brands and an important means of interaction with and source of information for consumers Logitech International S.A. | Fiscal 2023 Form 10-K | 27 Table of Contents of our products.
In addition, as a consumer electronics company, our websites are an important presentation of our company, identity and brands and an important means of interaction with and source of information for consumers of our products.
Without dividends, the trading price of our shares must appreciate for investors to realize a gain on their investment. Logitech International S.A. | Fiscal 2023 Form 10-K | 31 Table of Contents ITEM 1B. UNRESOLVED STAFF COMMENTS None.
Without dividends, the trading price of our shares must appreciate for investors to realize a gain on their investment. ITEM 1B. UNRESOLVED STAFF COMMENTS None.
Compliance with such requirements will also require additional expenditures by us or our suppliers, which could have a material adverse effect on our business, results of operations, financial condition and cash flows. In addition, ESG reporting and disclosure requirements continue to evolve, with increasing global regulation and heightened investor expectations.
Compliance with such requirements will also require additional expenditures by us or our suppliers, which could have a material adverse effect on our business, results of operations, financial condition and cash flows.
Any claims or proceedings against us, whether meritorious or not, could be time consuming, result in costly litigation or the diversion of significant operational resources, or require us to enter into royalty or licensing agreements, any of which could materially and adversely affect our business and results of operations. We may be unable to protect our proprietary rights.
Any claims or proceedings against us, whether meritorious or not, could be time consuming, result in costly litigation or the diversion of significant operational resources, or require us to enter into Logitech International S.A. | Fiscal 2024 Form 10-K | 29 Table of Contents royalty or licensing agreements, any of which could materially and adversely affect our business and results of operations.
As we expand into new product categories and markets in pursuit of growth, we will have to build relationships with new channel partners and adapt to new distribution and marketing models.
Logitech International S.A. | Fiscal 2024 Form 10-K | 20 Table of Contents As we expand into new product categories and markets in pursuit of growth, we will have to build relationships with new channel partners and adapt to new distribution and marketing models.
In addition, discontinuing product categories, even categories that we consider non-strategic, reduces the size and diversification of our business and causes us to be more dependent on a smaller number of product categories.
Divestitures may also involve warranties, indemnification or covenants that could restrict our business or result in litigation, additional expenses or liabilities. In addition, discontinuing product categories, even categories that we consider non-strategic, reduces the size and diversification of our business and causes us to be more dependent on a smaller number of product categories.
Our share repurchase programs do not obligate us to repurchase all or any of the dollar value of shares authorized for repurchase. The programs could also increase the volatility of the trading price of our shares. Similarly, we are not obligated to pay dividends on our registered shares.
Our share repurchase program does not obligate us to repurchase all or any of the dollar value of shares authorized for repurchase. The program could also increase the volatility of the trading price of our shares.
Logitech International S.A. | Fiscal 2023 Form 10-K | 22 Table of Contents While we maintain reserves for reasonably estimable liabilities and purchase liability insurance, our reserves may not be adequate to cover such claims and liabilities and our insurance is subject to deductibles and may not be adequate to cover such claims and liabilities.
While we maintain reserves for reasonably estimable liabilities and purchase liability insurance, our reserves may not be adequate to cover such claims and liabilities and our insurance is subject to deductibles and may not be adequate to cover such claims and liabilities.
Because our operating results are difficult to predict, our results may be below the expectations of financial analysts and investors, which could cause the price of our shares to decline.
Because our operating results are difficult to predict, our results may be below the expectations of financial analysts and investors, which could cause the price of our shares to decline. Our gross margins can vary significantly depending on multiple factors, which can result in unanticipated fluctuations in our operating results.
Logitech International S.A. | Fiscal 2023 Form 10-K | 29 Table of Contents Risks Related to our Financial Results Our operating results are difficult to predict and fluctuations in results may cause volatility in the price of our shares.
Risks Related to our Financial Results Our operating results are difficult to predict and fluctuations in results may cause volatility in the price of our shares.
In fiscal year 2023, we were impacted by adverse mac roeconomic and geopolitical conditions including but not limited to inflation, foreign currency fluctuations, and slowdown of economic activity around the world, in part due to changes in interest rates, and lower consumer and enterprise spending. In addition, the war in Ukraine increased global supply chain, logistics, and inflationary challenges.
In fiscal year 2024, we were impacted by adverse macroeconomic and geopolitical conditions including Logitech International S.A. | Fiscal 2024 Form 10-K | 23 Table of Contents but not limited to inflation, foreign currency fluctuations, and slowdown of economic activity around the world, in part due to changes in interest rates, and lower consumer and enterprise spending.
Price increases may not successfully offset cost increases or may cause us to lose market share and in turn adversely impact our operations. All these and other global and regional economic and geopolitical factors can materially adversely affect our business, results of operations and financial condition.
Price increases may not successfully offset cost increases or may cause us to lose market share and in turn adversely impact our operations.
We allocate significant resources to maintain our information technology systems and deploy network security, data encryption, training and other measures to protect against unauthorized access or misuse.
We allocate significant resources to maintain our information technology systems and implement technical and organizational measures recognized as “best practice” to protect against unauthorized access or misuse.
Discontinuing products with service components may cause us to continue to incur expenses to maintain services within the product life cycle or may adversely affect our customer and consumer relationships and brand. Divestitures may also involve warranties, indemnification or covenants that could restrict our business or result in litigation, additional expenses or liabilities.
We regularly review our product portfolio and update our non-strategic product categories and products. Discontinuing products with service components may cause us to continue to incur expenses to maintain services within the product life cycle or may adversely affect our customer and consumer relationships and brand.
Implementation of any material change in tax laws or policies or the adoption of new interpretations of existing tax laws and rulings, or termination or replacement of our tax arrangements with the canton of Vaud, by Switzerland or the canton of Vaud could result in a higher effective income tax rate, or a decreased tax asset, a charge to earnings and an accelerated pace of increase in our effective income tax rate, or a combination of such impacts, on our worldwide earnings and any such change will adversely affect our net income.
Implementation of any material change in tax laws or policies or the adoption of new interpretations of existing tax laws and rulings, or termination or replacement of our tax arrangements with the canton of Vaud may adversely affect our net income.
As a result, such regulations may have the effect of limiting our growth and market share in China, and disrupting manufacturing and operations in the region. For example, on June 10, 2021, the National People’s Congress Standing Committee of the People’s Republic of China passed China's new Anti-Foreign Sanctions Law.
As a result, such regulations may have the effect of limiting our growth and market share in China, and disrupting manufacturing and operations in the region.
Such variance may affect our growth, our previous outlook and expectations, and comparisons of our operating results and financial statements between periods. • We are continuously attempting to simplify our organization, to control operating costs through expense and global workforce management, to reduce the complexity of our product portfolio, and to better align costs with our current business.
Logitech International S.A. | Fiscal 2024 Form 10-K | 30 Table of Contents • We are continuously attempting to simplify our organization, to control operating costs through expense and global workforce management, to reduce the complexity of our product portfolio, and to better align costs with our current business.
For additional information, see "Competition” in Item 1 of this Annual Report on Form 10-K. We rely on third parties to sell and distribute our products, and we rely on their information to manage our business.
We rely on third parties to sell and distribute our products, and we rely on their information to manage our business.
The effectiveness of our marketing and sales efforts is uncertain and it is difficult to predict whether our marketing and sales efforts will result in increased sales. • The COVID-19 pandemic has led to evolving changes in our supply, operations, logistics and related expenses and use patterns and demand for certain of our products that may not recur or be sustainable in future periods. • We engage in acquisitions and divestitures, and such activity varies from period to period.
The effectiveness of our marketing and sales efforts is uncertain and it is difficult to predict whether our marketing and sales efforts will result in increased sales. • We engage in acquisitions and divestitures, and such activity varies from period to period.
Changes in our effective income tax rate may also make it more difficult to compare our net income and earnings per share between periods. We operate in multiple jurisdictions and our profits are taxed pursuant to the tax laws of these jurisdictions.
We operate in multiple jurisdictions and our profits are taxed pursuant to the tax laws of these jurisdictions.
We file Swiss and foreign tax returns. We are frequently subject to tax audits, examinations and assessments in various jurisdictions.
As many countries have proposed or enacted Pillar Two legislation in jurisdictions in which we operate, we continue to monitor the relevant developments. We file Swiss and foreign tax returns. We are frequently subject to tax audits, examinations and assessments in various jurisdictions.
We may find it difficult to provide competitive equity incentives, and our ability to hire, retain and motivate key personnel may suffer.
We may find it difficult to provide competitive equity incentives, and our ability to hire, retain and motivate key personnel may suffer. As we focus on growth opportunities, we may divest or discontinue non-strategic product categories, or pursue strategic acquisitions and investments, which could have an adverse impact on our business.
Any of these risks could adversely affect our business, financial condition and operating results. Sales growth in key markets, including China, is an important part of our expectations for our business.
Any of these risks could adversely affect our business, financial condition and operating results. In addition, the increasingly strict and numerous regulations in China may create a more challenging environment for foreign companies operating in the region.
Logitech International S.A. | Fiscal 2023 Form 10-K | 20 Table of Contents In addition, market demand remains less predictable and more volatile than pre-COVID-19, partially due to the current macroeconomic and geopolitical conditions.
In addition, market demand remains less predictable and more volatile than before the COVID-19 pandemic.
Concerns over climate change have resulted and may in the future result in new or additional legal, legislative and regulatory requirements to reduce or mitigate the effects of climate change on the environment, which could result in future tax, transportation and other cost increases that could adversely affect our business.
Concerns over climate change have resulted in increased regulatory requirements and reporting frameworks designed to reduce or mitigate the effects of climate change on the environment. However, the lack of harmonized regulatory requirements and reporting frameworks exposes companies to navigate myriad different requirements, which has led to challenges in ESG reporting.

… 32 more changes not shown on this page.

Item 2. Properties

Properties — owned and leased real estate

3 edited+0 added−0 removed3 unchanged
Biggest changeOur principal corporate and administrative offices, which includes our headquarters in Lausanne, Switzerland, and future corporate offices in San Jose, California (in the process of being relocated from our current corporate offices in Newark, California) and corporate offices in Hsinchu, Taiwan, together make up approximately 250,000 square feet of leased space.
Biggest changeOur principal corporate and administrative offices, which includes our headquarters in Lausanne, Switzerland, and corporate offices in San Jose, California, and corporate offices in Hsinchu, Taiwan, together make up approximately 250,000 square feet of leased space.
Both our Lausanne, Switzerland headquarters and San Jose, California future location are designed to serve our research and development, product marketing, sales management, technical support and administrative functions. Our Hsinchu, Taiwan location serves our mechanical engineering, process engineering, manufacturing support, quality assurance, design, research and development, and administrative functions.
Both our Lausanne, Switzerland headquarters and San Jose, California location are designed to serve our research and development, product marketing, sales management, technical support and administrative functions. Our Hsinchu, Taiwan location serves our mechanical engineering, process engineering, manufacturing support, quality assurance, design, research and development, and administrative functions.
We maintain marketing and channel support offices in approximately 80 locations and over 40 countries, with lease expiration dates from 2023 to 2033. As of March 31, 2023, the majority of our properties are leased; however, we also own some of the manufacturing units and employee dormitories in Suzhou, China, from which we occupy approximately 720,000 square feet.
We maintain marketing and channel support offices in approximately 80 locations and over 40 countries, with lease expiration dates from 2024 to 2033. As of March 31, 2024, the majority of our properties are leased; however, we also own some of the manufacturing units and employee dormitories in Suzhou, China, from which we occupy approximately 720,000 square feet.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

3 edited+0 added−0 removed2 unchanged
Biggest changeITEM 3. LEGAL PROCEEDINGS From time-to-time, we are involved in claims and legal proceedings that arise in the ordinary course of our business. We are currently subject to several such claims and a small number of legal proceedings. We believe that these matters lack merit and we intend to vigorously defend against them.
Biggest changeITEM 3. LEGAL PROCEEDINGS From time-to-time, we are involved in claims and legal proceedings that arise in the ordinary course of our business. We are currently subject to several such claims and legal proceedings. We periodically assess the Company’s liabilities and contingencies in connection with these matters based upon the latest information available.
However, litigation is subject to inherent uncertainties, and there can be no assurances that our defenses will be successful or that any such lawsuit or claim would not have a material adverse impact on our business, financial condition, cash flows and results of operations in a particular period.
However, litigation is subject to inherent uncertainties, and there can be no assurances that our defenses will be successful or that any such lawsuit or claim would not have a material adverse impact on our Logitech International S.A. | Fiscal 2024 Form 10-K | 33 Table of Contents business, financial condition, cash flows and results of operations in a particular period.
Based on the currently available information, we do not believe that resolution of pending matters will have a material adverse effect on our financial condition, cash flows or results of operations.
We follow ASC ("Accounting Standards Codification") 450, Contingencies, in determining the accounting and disclosure for these contingencies. Based on the currently available information, we do not believe that resolution of pending matters will have a material adverse effect on our financial condition, cash flows or results of operations.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

12 edited+5 added−2 removed9 unchanged
Biggest changeTotal Number of Shares Repurchased Weighted Average Price Paid Per Share Remaining Amount that May Yet Be Repurchased under the Program During the three months ended March 31, 2023 CHF (LOGN) USD (LOGI) Month 1 January 1, 2023 to January 27, 2023 SIX 644 55.24 — $ 557,808 Month 2 January 28, 2023 to February 24, 2023 SIX 202 53.61 — 546,102 Nasdaq 54 59.00 542,904 Month 3 February 24, 2023 to March 31, 2023 SIX 695 49.11 — 505,844 1,595 52.33 56.68 $ 505,844 Performance Graph The information contained in the Performance Graph shall not be deemed to be "soliciting material" or "filed" with the SEC or subject to the liabilities of Section 18 of the Securities Exchange Act of 1934, as amended (the Exchange Act), except to the extent that we specifically incorporate it by reference into a document filed under the Securities Act of 1933, as amended (the Securities Act), or the Exchange Act .
Biggest changePerformance Graph The information contained in the Performance Graph shall not be deemed to be "soliciting material" or "filed" with the SEC or subject to the liabilities of Section 18 of the Securities Exchange Act of 1934, as amended (the Exchange Act), except to the extent that we specifically incorporate it by reference into a document filed under the Securities Act of 1933, as amended (the Securities Act), or the Exchange Act .
In May 2023, the Board of Directors recommended that the Company increase the cash dividend per share for fiscal year 2023 by approximately CHF 0.10 per share to CHF 1.06 per share (approximately $1.16 per share based on the exchange rate on March 31, 2023).
In May 2024, the Board of Directors recommended that the Company increase the cash dividend per share for fiscal year 2024 by approximately CHF 0.10 per share to CHF 1.16 per share (approximately $1.28 per share based on the exchange rate on March 31, 2024).
Logitech International S.A. | Fiscal 2023 Form 10-K | 34 Table of Contents The following graph compares the cumulative total stockholder return on our shares, the Nasdaq Composite Index, and the S&P 500 Information and Technology Index.
Logitech International S.A. | Fiscal 2024 Form 10-K | 37 Table of Contents The following graph compares the cumulative total stockholder return on our shares, the Nasdaq Composite Index, and the S&P 500 Information and Technology Index.
This amount may vary based on the number of shares outstanding, net of treasury shares, as of the record date for the dividend, but will not exceed approximately CHF 183.5 million (based on our shares currently issued or 173,106,620 shares). This recommendation will be voted on by our shareholders at the Company’s 2023 Annual General Meeting.
This amount may vary based on the number of shares outstanding, net of treasury shares, as of the record date for the dividend, but will not exceed approximately CHF 200.8 million (based on our shares currently issued or 173,106,620 shares). This recommendation will be voted on by our shareholders at the Company’s 2024 Annual General Meeting.
The following tables present certain information related to purchases made by Logitech of its equity securities under its publicly announced share repurchase programs (in thousands, except per share amounts): Weighted Average Price Per Share Remaining Amount that May Yet Be Repurchased under the Program During Fiscal Year Ended Shares Repurchased (1) CHF (LOGN) USD (LOGI) March 31, 2021 1,845 81.35 89.20 $ 85,382 March 31, 2022 4,607 82.15 89.36 $ 423,696 March 31, 2023 7,562 52.94 55.25 $ 505,844 (1) In fiscal year 2021, 2022 and 2023, the number of shares repurchased on the SIX was 1.0 million, 3.9 million, and 7.4 million , respectively, and the number of shares repurchased on NASDAQ was 0.9 million, 0.7 million, and 0.2 million, respectively.
The following tables present certain information related to purchases made by Logitech of its equity securities under its publicly announced share repurchase programs (in thousands, except per share amounts): Weighted Average Price Per Share Remaining Amount that May Yet Be Repurchased under the Program During Fiscal Year Ended Shares Repurchased (1) CHF (LOGN) USD (LOGI) March 31, 2022 4,607 82.15 89.36 $ 423,696 March 31, 2023 7,562 52.94 55.25 $ 505,844 March 31, 2024 7,100 65.46 73.63 $ 635,750 (1) In fiscal years 2022, 2023 and 2024, the number of shares repurchased on the SIX was 3.9 million, 7.4 million, a nd 6.9 million, respectively, and the number of shares repurchased on NASDAQ was 0.7 million, 0.2 million, and 0.2 million , respectively.
On September 14, 2022, Logitech's shareholders approved a cash dividend payment of CHF 0.96 per share out of retained earnings to Logitech's shareholders who owned shares on September 27, 2022. Eligible shareholders were paid CHF 0.96 per share ($0.98 per share in U.S. Dollars based on the exchange rate on the date of payment), totaling $158.7 million in U.S.
Dollars on September 27, 2023. On September 14, 2022, Logitech's shareholders approved a cash dividend payment of CHF 0.96 per share out of retained earnings to Logitech's shareholders who owned shares on September 27, 2022. Eligible shareholders were paid CHF 0.96 per share ($0.98 per share in U.S.
The graph assumes that $100 was invested in our LOGI shares, the Nasdaq Composite Index and the S&P 500 Information and Technology Index on March 31, 2018 and calculates the annual return through March 31, 2023.
The graph assumes that $100 was invested in our LOGI shares, the Nasdaq Composite Index and the S&P 500 Information and Technology Index on March 31, 2019 and calculates the annual return through March 31, 2024. The stock price performance on the following graph is not necessarily indicative of future stock price performance.
Based on our shares outstanding, net of treasury shares, as of March 31, 2023 (159,343,273 shares), this would result in an aggregate gross dividend of approximately CHF 168.9 million (approximately $184.2 million based on the exchange rate on March 31, 2023).
Based on our shares outstanding, net of treasury shares, as of March 31, 2024 (153,863,262 shares), this would result in an aggregate gross dividend of approximately CHF 178.5 million (approximately $197.2 million based on the exchange rate on March 31, 2024).
As of May 3, 2023, there were 173,106,620 shares issued (including 14,368,910 shares held as treasury stock) held by 49,807 holders of record, and the closing price of our shares was CHF 55.40 ($61.89 based on exchange rates on such date) per share on the SIX Swiss Exchange and $62.68 per share as reported by the Nasdaq Global Select Market.
As of May 2, 2024, there were 173,106,620 shares issued (including 19,662,686 shares held as treasury stock) held by 36,974 holders of record, and the closing price of our shares was CHF 74.58 ($81.09 based on exchange rates on such date) per share on the SIX Swiss Exchange and $81.77 per share as reported by the Nasdaq Global Select Market.
Logitech International S.A. | Fiscal 2023 Form 10-K | 33 Table of Contents Share Repurchases In fiscal year 2023, the following approved share repurchase program was in place (in thousands): Share Repurchase Program Approved Shares Approved Amounts (1) May 2020 17,311 $ 1,500,000 (1) In April 2021, our Board of Directors approved an increase of $750.0 million of the 2020 share repurchase program, to an aggregate amount of $1.0 billion.
Logitech International S.A. | Fiscal 2024 Form 10-K | 35 Table of Contents Share Repurchases In fiscal year 2024 , the following approved share repurchase programs were in place (in thousands): Share Repurchase Program Approved Shares Approved Amounts (1) May 2020 (1) 17,311 $ 1,500,000 July 2023 (2) 17,311 $ 1,000,000 (1) The 2020 share repurchase program expired on July 27, 2023.
Dollars on September 28, 2022. On September 8, 2021, Logitech's shareholders approved a cash dividend payment of CHF 147.0 million out of retained earnings to Logitech shareholders who owned shares on September 21, 2021. Eligible shareholders were paid CHF 0.87 per share ($0.95 per share in U.S. Dollars), totaling $159.4 million in U.S. Dollars on September 22, 2021.
On September 13, 2023, Logitech's shareholders approved a cash dividend payment of CHF 1.06 per share out of retained earnings to Logitech's shareholders who owned shares on September 26, 2023. Eligible shareholders were paid CHF 1.06 per share ($1.16 per share in U.S. Dollars based on the exchange rate on the date of payment), totaling $182.3 million in U.S.
March 31, 2018 2019 2020 2021 2022 2023 Logitech $ 100 $ 109 $ 121 $ 298 $ 212 $ 171 Nasdaq Composite Index $ 100 $ 111 $ 111 $ 193 $ 209 $ 181 S&P 500 Information and Technology Index $ 100 $ 115 $ 127 $ 212 $ 257 $ 245
March 31, 2019 2020 2021 2022 2023 2024 Logitech $ 100 $ 111 $ 274 $ 195 $ 157 $ 246 Nasdaq Composite Index $ 100 $ 101 $ 175 $ 189 $ 164 $ 222 S&P 500 Information and Technology Index $ 100 $ 110 $ 184 $ 222 $ 212 $ 310
Removed
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.
Added
Dollars based on the exchange rate on the date of payment), totaling $158.7 million in U.S. Dollars on September 28, 2022.
Removed
The stock price performance on the following graph is not necessarily indicative of future stock price performance. ________________________________________ *$100 invested on March 31, 2018, in stock or index, including reinvestment of dividends. Fiscal year ending March 31. Copyright© 2023 Standard & Poor's, Inc. Used with permission. All rights reserved.
Added
See Note 14 to the consolidated financial statements for further information. (2) In June 2023, our Board of Directors approved a new, three-year share repurchase program. The Swiss Takeover Board approved the 2023 share repurchase program in July 2023 and the program became effective on July 28, 2023. See Note 14 to the consolidated financial statements for further information.
Added
Shares were repurchased in fiscal year 2022 and fiscal year 2023 to support equity incentive plans. In fiscal year 2024, 4.1 million shares were repurchased for cancellation and the remaining shares were repurchased to support equity incentive plans.
Added
Logitech International S.A. | Fiscal 2024 Form 10-K | 36 Table of Contents Total Number of Shares Repurchased Weighted Average Price Paid Per Share Remaining Amount that May Yet Be Repurchased under the Program During the three months ended March 31, 2024 CHF (LOGN) USD (LOGI) Month 1 December 30, 2023 to January 26, 2024 SIX 430 (1) 79.71 N/A $ 727,751 Nasdaq — N/A — 727,751 Month 2 January 27, 2024 to February 23, 2024 SIX 465 (2) 75.13 N/A 687,750 Nasdaq — N/A — 687,750 Month 3 February 24, 2024 to March 31, 2024 SIX 577 (2) 80.00 N/A 635,750 Nasdaq — N/A — 635,750 1,472 78.38 N/A $ 635,750 (1) Includes 346,000 shares repurchased on the ordinary trading line to support equity incentive plans and 84,000 shares repurchased on the second trading line for cancellation under the 2023 share repurchase program.
Added
(2) Shares repurchased on the second line for cancellation under the 2023 share repurchase program.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

96 edited+33 added−19 removed38 unchanged
Biggest changeProvision for Income Taxes The provision for income taxes and effective income tax rates for fiscal years 2023 and 2022 were as follows (Dollars in thousands): Years Ended March 31, 2023 2022 Provision for income taxes $ 98,947 $ 131,305 Effective income tax rate 21.3 % 16.9 % The change in the effective income tax rate between fiscal years 2023 and 2022 was primarily due to the mix of income and losses in the various tax jurisdictions in which we operate.
Biggest changeProvision for Income Taxes The provision for income taxes and effective income tax rates for fiscal years 2024 and 2023 were as follows (Dollars in thousands): Years Ended March 31, 2024 2023 Provision for income taxes $ 9,453 $ 98,947 Effective income tax rate 1.5 % 21.3 % The change in the effective income tax rate between fiscal years 2024 and 2023 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, a Swiss Tax Ruling that provides future tax benefits as discussed below, and Foreign-Derived Intangible Income ("FDII") incentive in the U.S.
(2) DPO is determined using ending accounts payable as of the most recent quarter-end and cost of goods sold for the most recent quarter. (3) ITO is determined using ending inventories and annualized cost of goods sold (based on the most recent quarterly cost of goods sold).
(2) DPO is determined using ending accounts payable as of the most recent quarter-end and cost of goods sold for the most recent quarter. (3) ITO is determined using ending inventories as of the most recent quarter-end and annualized cost of goods sold (based on the most recent quarterly cost of goods sold).
Restructuring Charges (Credits), Net During the second quarter of fiscal year 2023, we initiated a restructuring plan to realign our business group and engineering structure with our go-to-market strategy to more effectively compete within the enterprise market and to better serve end-users.
Restructuring Charges, Net During the second quarter of fiscal year 2023, we initiated a restructuring plan to realign our business group and engineering structure with our go-to-market strategy to more effectively compete within the enterprise market and to better serve end-users.
Indemnifications We indemnify certain suppliers and customers for losses arising from matters such as intellectual property disputes and product safety defects, subject to certain restrictions. The scope of these indemnities varies, but in some instances includes indemnification for damages and expenses, including reasonable attorneys’ fees. As of March 31, 2023, no material a mounts have been accrued for indemnification provisions.
Indemnifications We indemnify certain suppliers and customers for losses arising from matters such as intellectual property disputes and product safety defects, subject to certain restrictions. The scope of these indemnities varies, but in some instances includes indemnification for damages and expenses, including reasonable attorneys’ fees. As of March 31, 2024, no material a mounts have been accrued for indemnification provisions.
If we are not successful in launching and phasing in our new products, or market competition increases, or we are not able to sell the new products at the prices planned, it could have a material impact on our sales, gross margin, operating results including operating cash flow, and inventory turnover in the future.
If we are not successful in launching and phasing in our new products, or market competition increases, or we are not able to sell the new products at the prices planned, it could have a material impact on our sales, gross profit, operating results including operating cash flow, and inventory turnover in the future.
If we receive a separately identifiable benefit from a customer and can reasonably estimate the fair value of that benefit, the cost of the Customer Programs is recognized in operating expenses. Customer Incentive Programs. Customer incentive programs include performance-based incentives and consumer rebates. We offer performance-based incentives to our customers and indirect partners based on pre-determined performance criteria.
If we receive a separately identifiable benefit from a customer and can reasonably estimate the fair value of that benefit, the cost of the Customer Programs is recognized in operating expenses. Customer Incentive Programs. Customer incentive programs include performance-based incentives and consumer rebates. We offer performance-based incentives to our customers and indirect partners based on predetermined performance criteria.
Dollar amount of $158.7 million based on the exchange rate on the date of payment) out of fiscal year 2022 retained earnings. In fiscal year 2022, we paid a cash dividen d of CHF 0.87 per share, or CHF 147.0 million (U.S. Dollar amount of $159.4 million) out of fiscal year 2021 retained earnings.
Dollar amount of $158.7 million based on the exchange rate on the date of payment ) out of fiscal year 2022 retained earnings. In fiscal year 2022, we paid a cash dividend of CHF 0.87 per share, or CHF 147.0 million (U.S. Dollar amount of $159.4 million ) out of fiscal year 2021 retained earnings.
We received final tax assessments in Switzerland through fiscal year 2019. For other material foreign jurisdictions such as the United States and China, we are generally not subject to tax examinations for years prior to fiscal year 2020 and calendar year 2020, respectively.
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 and China, we are generally not subject to tax examinations for years prior to fiscal year 2020 and calendar year 2020, respectively.
We are unable to reasonably estimate the maximum amount that could be payable under these arrangements because these exposures are not capped, the obligations are conditional in nature, and the facts and circumstances involved in any situation that might arise are variable. Logitech International S.A. | Fiscal 2023 Form 10-K | 49 Table of Contents
We are unable to reasonably estimate the maximum amount that could be payable under these arrangements because these Logitech International S.A. | Fiscal 2024 Form 10-K | 52 Table of Contents exposures are not capped, the obligations are conditional in nature, and the facts and circumstances involved in any situation that might arise are variable.
Operating leases for facilities are generally renewable at our option and usually include escalation clauses linked to inflation . The remaining terms of our non-cancelable operating leases expire in various years thro ugh 2033. See Note 17 - Leases in our Notes to the consolidated financial statements included in this report for more information on leases.
Operating leases for facilities are generally renewable at our option and usually include escalation clauses linked to inflation . The remaining terms of our non-cancelable operating leases expire in various years thr ough 2033. See Note 17 - Leases in our Notes to the consolidated financial statements included in this report for more information on leases.
Our expenditures for property, plant and equipment during fiscal year 2023 were primarily for tooling and equipment, building improvements, and computer hardware and software.
Our expenditures for property, plant and equipment during fiscal year 2024 were primarily for building improvements, tooling and equipment, and computer hardware and software.
Income Taxes Payable As of March 31, 2023, we had $106.4 million in non-current income taxes payable, including interest and penalties, related to our income tax liability for uncertain tax positions. At this time, we are unable to make a reasonably reliable estimate of the timing of payments in individual years in connection with these tax liabilities.
Income Taxes Payable As of March 31, 2024, we had $112.6 million in non-current income taxes payable, including interest and penalties, related to our income tax liability for uncertain tax positions. At this time, we are unable to make a reasonably reliable estimate of the timing of payments in individual years in connection with these tax liabilities.
In May 2023, the B oard of Directors recommended that we pay cash dividends for fiscal year 2023 of CHF 1.06 per share (approximately $1.16 per share based on the exchange rate on March 31, 2023).
In May 2024, the B oard of Directors recommended that we pay cash dividends for fiscal year 2024 of CHF 1.16 per share (approximately $1.28 per share based on the exchange rate on March 31, 2024).
Contractual Obligations and Commitments Purchase Commitments As of March 31, 2023, we had non-cancelable purchase commitments of $368.1 million for inventory purchases made in the normal course of business from original design manufacturers, contract manufacturers and other suppliers, the majority of which are expected to be fulfilled within the next 12 months.
Contractual Obligations and Commitments Purchase Commitments As of March 31, 2024, we had non-cancelable purchase commitments of $396.8 million for inventory purchases made in the normal course of business from original design manufacturers, contract manufacturers and other suppliers, the majority of which are expected to be fulfilled within the next 12 months.
Interest Income Interest income for fiscal years 2023 and 2022 was as follows (in thousands): Years Ended March 31, 2023 2022 Interest Income $ 18,331 $ 1,246 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.
Interest Income Interest income for fiscal years 2024 and 2023 was as follows (in thousands): Years Ended March 31, 2024 2023 Interest income $ 50,636 $ 18,331 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.
Marketing and Selling Marketing and selling expenses consist of personnel and related overhead costs, corporate and product marketing, promotions, advertising, trade shows, technical support for customer experiences and facilities costs. During fiscal year 2023, marketing and selling expenses decreased $216.7 million, compared to fiscal year 2022, primarily driven by our reduction in third-party marketing and advertising spend.
Marketing and Selling Marketing and selling expenses consist of personnel and related overhead costs, corporate and product marketing, promotions, advertising, trade shows, technical support for customer experiences and facilities costs. During fiscal year 2024, marketing and selling expenses decreased $78.9 million, compared to fiscal year 2023, primarily driven by our reduction in third-party marketing spend.
During fiscal year 2023 , there was a $24.6 million loss from currency exchange rate effect on cash and cash equivalents, 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.
During fiscal year 2024 , there was a $12.8 million loss from currency exchange rate effect on cash and cash equivalents, primarily due to exchange rate fluctuations of Euro, Chinese Renminbi, Australian Dollar and Swiss Franc versus the U.S. Dollar and timing of our cash transactions over the period.
We continually review our product offerings and our strategic direction in light of our profitability targets, competitive conditions, changing consumer trends and the evolving nature of the interface between the consumer and the digital world. Impacts of Macroeconomic and Geopolitical Conditions on our Business In fiscal year 2023, our business was impacted by adverse macroeconomic and geopolitical conditions.
We continually review our product offerings and our strategic direction in light of our profitability targets, competitive conditions, changing consumer trends and the evolving nature of the interface between the consumer and the digital world. Impacts of Macroeconomic and Geopolitical Conditions on our Business Our business has been impacted by adverse macroeconomic and geopolitical conditions.
For additional information, see "Liquidity and Capital Resources" below and Item 1A " Risk Factors ," including under the caption " Adverse global and regional economic and geopolitical conditions can materially adversely affect our business, results of operations and financial condition , " “We purchase key components and products from a limited number of sources, and our business and operating results could be adversely affected if supply were delayed or constrained or if there were shortages of required components,” “Our principal manufacturing operations and third-party contract manufacturers are located in China and Southeast Asia, which exposes us to risks associated with doing business in that geographic area as well as potential tariffs, adverse trade regulations, adverse tax consequences and pressure to move or diversify our manufacturing locations,” “If we do not accurately forecast market demand for our products, our business and operating results could be adversely affected,” and "If we do not successfully coordinate the worldwide manufacturing and distribution of our products, we could lose sales and our business and operating results could be adversely affected.” Trends and Uncertainties Several long-term secular-trends offer long-term structural growth opportunities across Logitech’s product portfolio, including work and learn from anywhere (hybrid work), video everywhere, the rise of social gaming for participants and spectators, and the democratization of digital content creation.
For additional information, see Item 1A " Risk Factors ," including under the captions " Adverse global and regional economic and geopolitical conditions can materially adversely affect our business, results of operations and financial condition , " “We purchase key components and products from a limited number of sources, and our business and operating results could be adversely affected if supply were delayed or constrained or if there were shortages of required components,” “Our principal manufacturing operations and third-party contract manufacturers are located in China and Southeast Asia, which exposes us to risks associated with doing business in that geographic area as well as potential tariffs, adverse trade regulations, adverse tax consequences and pressure to move or diversify our manufacturing locations,” “If we do not accurately forecast market demand for our products, our business and operating results could be adversely affected,” and "If we do not successfully coordinate the worldwide manufacturing and distribution of our products, we could lose sales and our business and operating results could be adversely affected.” Trends and Uncertainties Several long-term secular-trends offer long-term structural growth opportunities across Logitech’s product portfolio.
Non-service cost net pension income (expense) and other increased in fiscal year 2023, compared to fiscal year 2022, primarily due to the curtailment gain recognized in fiscal year 2023 for one of our defined benefit plans as a result of the restructuring actions undertaken by the Company (see Notes 5 and 16 to our consolidated financial statements).
Non-service cost net pension income and oth er decreased in fiscal year 2024 , compared to fiscal year 2023 , primarily due to the curtailment gain recognized in fiscal year 2023 for one of our defined benefit plans as a result of the restructuring actions undertaken by the Company (see Notes 5 and 16 to our consolidated financial statements).
As of March 31, 2023 and 2022, the total amount of unrecognized tax benefits due to uncertain tax positions was $186.8 million and $176.0 million, respectively, all of which would affect the effective income tax rate if recognized.
As of March 31, 2024 and 2023, the total amount of unrecognized tax benefits due to uncertain tax positions was $192.7 million and $186.8 million, respectively, all of which would affect the effective income tax rate if recognized.
We have taken steps to mitigate the impact of these challenges, including but not limited to: (i) reduction in our operating expenses as revenues have declined 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.
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 B2B capabilities, and (iv) release of new products to increase the value proposition of our portfolio.
Gross Profit Gross profit for fiscal years 2023 and 2022 was as follows (Dollars in thousands): Years Ended March 31, 2023 2022 Change Net sales $ 4,538,818 $ 5,481,101 (17.2) % Gross profit $ 1,719,515 $ 2,263,006 (24.0) % Gross margin 37.9 % 41.3 % Gross profit consists of sales, less cost of goods sold (which includes materials, direct labor and related overhead costs, costs of manufacturing facilities, royalties, costs of purchasing components from outside suppliers, distribution costs, warranty costs, customer support costs, shipping and handling costs, outside processing costs and write-down of inventories), and amortization of intangible assets.
Gross Profit Gross profit for fiscal years 2024 and 2023 was as follows (Dollars in thousands): Years Ended March 31, 2024 2023 Change Net sales $ 4,298,467 $ 4,538,818 (5.3) % Gross profit $ 1,778,021 $ 1,719,515 3.4 % Gross margin 41.4 % 37.9 % Gross profit consists of sales, less cost of goods sold (which includes materials, direct labor and related overhead costs, costs of manufacturing facilities, royalties, costs of purchasing components from outside suppliers, distribution costs, warranty costs, customer support costs, shipping and handling costs, outside processing costs and write-down of inventories), and amortization of intangible assets.
For a discussion of the year ended March 31, 2022 compared to the year ended March 31, 2021, please refer to Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K filed with the SEC on May 18, 2022.
For a discussion of the year ended March 31, 2023 compared to the year ended March 31, 2022, please refer to Part II, I tem 7, "Management's Discussi on and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K filed with the SEC on May 17, 2023.
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 to purchase up to 17.3 million of Logitech shares. The Swiss Takeover Board approved this increase and it became effective on August 19, 2022.
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.
Business Seasonality and Product Introductions We have historically experienced higher sales in our third fiscal quarter ending December 31, compared to other fiscal quarters in our fiscal year, primarily due to the increased consumer demand for our products during the year-end holiday buying season and year-end spending by enterprises.
For additional information, see Part I, Item 1A “ Risk Factors .” Business Seasonality and Product Introductions We have historically experienced higher sales in our third fiscal quarter ending December 31, compared to other fiscal quarters in our fiscal year, primarily due to the increased consumer demand for our products during the year-end holiday buying season and year-end spending by enterprises.
Although we enter into trading plans for systematic repurchases (e.g., 10b5-1 trading plans) from time to time, our share repurchase program provides us with the opportunity to make opportunistic repurchases during periods of favorable market conditions and is expected to remain in effect for a period of three years through July 27, 2023.
Logitech International S.A. | Fiscal 2024 Form 10-K | 51 Table of Contents Although we enter into trading plans for systematic repurchases (e.g., 10b5-1 trading plans) from time to time, our 2023 share repurchase program provides us with the opportunity to make opportunistic repurchases during periods of favorable market conditions and is expected to remain in effect for a period of three years through July 27, 2026.
Operating expenses for fiscal year 2023 were $1,261.0 million, or 27.8% of sales, compared to $1,489.0 million, or 27.2% of sales, for fiscal year 2022. The decrease in operating expenses was primarily driven by a reduction in marketing and advertising spend.
Operating expenses for fiscal year 2024 were $1,190.7 million , or 27.7% of sales, compared to $1,261.0 million, or 27.8% of sales, for fiscal year 2023. The decrease in operating expenses was primarily driven by a reduction in marketing spend.
For fiscal year 2023, net cash used in financing activities was $583.4 million, resulting from repurchases of our registered shares of $418.3 million, payments of cash dividends of $158.7 million, and tax withholdings related to Logitech International S.A. | Fiscal 2023 Form 10-K | 47 Table of Contents net share settlements of restricted stock units of $29.2 million, partially offset by proceeds from exercise of stock options and purchase rights of $28.8 million.
Logitech International S.A. | Fiscal 2024 Form 10-K | 50 Table of Contents For fiscal year 2024, net cash used in financing activities was $690.2 million , primarily resulting from repurchases of our registered shares of $504.2 million , payments of cash dividends of $182.3 million , and tax withholdings related to net share settlements of restricted stock units of $29.7 million , partially offset by proceeds from exercise of stock options and purchase rights of $32.2 million .
We have firm purchase commitments of $26.3 million for capital expenditures, primarily related to commitments for tooling and equipment for new and existing products and commitments to vendors to fit out and furnish office facilities. We expect to continue making capital expenditures in the future to support product development activities and ongoing and expanded operations.
We have firm purchase commitments of $13.4 million for capital expenditures primarily related to commitments for tooling and equipment for new and existing products. We expect to continue making capital expenditures in the future to support product development activities and ongoing and expanded operations.
Logitech International S.A. | Fiscal 2023 Form 10-K | 46 Table of Contents The following table presents selected financial information and statistics as of March 31, 2023 and 2022 (Dollars in thousands): March 31, 2023 2022 Accounts receivable, net $ 630,382 $ 675,604 Accounts payable $ 406,968 $ 636,306 Inventories $ 682,893 $ 933,124 Days sales in accounts receivable (DSO)(Days) (1) 59 49 Days accounts payable outstanding (DPO) (Days) (2) 59 78 Inventory turnover (ITO)(x) (3) 3.6 3.2 (1) DSO is determined using ending accounts receivable, net as of the most recent quarter-end and sales for the most recent quarter.
Logitech International S.A. | Fiscal 2024 Form 10-K | 49 Table of Contents The following table presents selected financial information and statistics as of March 31, 2024 and 2023 (Dollars in thousands): March 31, 2024 2023 Accounts receivable, net $ 541,715 $ 630,382 Accounts payable $ 448,627 $ 406,968 Inventories $ 422,513 $ 682,893 Days sales in accounts receivable (DSO)(Days) (1) 48 59 Days accounts payable outstanding (DPO) (Days) (2) 70 59 Inventory turnover (ITO)(x) (3) 5.4 3.6 (1) DSO is determined using ending accounts receivable, net, as of the most recent quarter-end and sales for the most recent quarter.
Assessing the period in which claims are expected to be submitted and the relevance of the historical claim experience require significant management judgment to estimate the breakage of Customer Programs in any accounting period. We regularly evaluate the adequacy of our accruals for Customer Programs and product returns.
Assessing the period in which claims are expected to be submitted and the relevance of the historical claim experience require significant management judgment to estimate the breakage of Customer Programs in any accounting period.
During the fourth quarter of fiscal year 2023, we undertook further actions to remove organization layers as well as streamline our marketing organization to increase efficiency. As a result, we recorded pre-tax restructuring charges totaling $34.6 million primarily related to employee severance and other termination benefits. We expect to substantially complete these restructuring activities within the next twelve months.
During the fourth quarter of fiscal year 2023, we undertook further actions to remove organization layers as well as streamline our marketing organization to increase efficiency. As a result, we recorded pre-tax restructuring charges totaling $3.9 million and $34.6 million during fiscal years 2024 and 2023, respectively, primarily related to employee severance and other termination benefits.
The decrease in investment income for fiscal year 2023 compared to fiscal year 2022 primarily relates to the change in market performance of the underlying securities.
The increase in investment gain for fiscal year 2024, compared to fiscal year 2023, primarily relates to the change in market performance of the underlying securities.
Logitech International S.A. | Fiscal 2023 Form 10-K | 42 Table of Contents Operating Expenses Operating expenses for fiscal years 2023 and 2022 were as follows (Dollars in thousands): Years Ended March 31, 2023 2022 Marketing and selling $ 809,182 $ 1,025,899 % of sales 17.8 % 18.7 % Research and development 280,796 291,844 % of sales 6.2 % 5.3 % General and administrative 124,652 148,648 % of sales 2.7 % 2.7 % Amortization of intangible assets and acquisition-related costs 11,843 16,947 % of sales 0.3 % 0.3 % Impairment of intangible assets — 7,000 % of sales N/A 0.1 % Change in fair value of contingent consideration for business acquisition — (3,509) % of sales N/A (0.1) % Restructuring charges, net 34,573 2,165 % of sales 0.8 % — % Total operating expenses $ 1,261,046 $ 1,488,994 % of sales 27.8 % 27.2 % The decrease in total operating expenses during fiscal year 2023, compared to fiscal year 2022, was mainly due to decreases in marketing and selling expenses, partially offset by an increase in restructuring charges.
Logitech International S.A. | Fiscal 2024 Form 10-K | 45 Table of Contents Operating Expenses Operating expenses for fiscal years 2024 and 2023 were as follows (Dollars in thousands): Years Ended March 31, 2024 2023 Marketing and selling $ 730,310 $ 809,182 % of sales 17.0 % 17.8 % Research and development 287,243 280,796 % of sales 6.7 % 6.2 % General and administrative 155,056 124,652 % of sales 3.6 % 2.7 % Amortization of intangible assets and acquisition-related costs 10,934 11,843 % of sales 0.2 % 0.3 % Impairment of intangible assets 3,526 — % of sales 0.1 % N/A Change in fair value of contingent consideration for business acquisition (250) — % of sales — % N/A Restructuring charges, net 3,866 34,573 % of sales 0.1 % 0.8 % Total operating expenses $ 1,190,685 $ 1,261,046 % of sales 27.7 % 27.8 % The decrease in total operating expenses during fiscal year 2024, compared to fiscal year 2023, was primarily due to decreases in marketing and selling expenses and restructuring charges, net, partially offset by an increase in general and administrative expenses.
General and Administrative General and administrative expenses consist primarily of personnel and related overhead, information technology, and facilities costs for the infrastructure functions such as finance, information systems, executives, human resources and legal. During fiscal year 2023, general and administrative expenses decreased $24.0 million, compared to fiscal year 2022, primarily driven by lower personnel-related costs.
General and Administrative General and administrative expenses primarily consist of personnel and related overhead, information technology, and facilities costs for the infrastructure functions such as finance, information systems, executives, human resources and legal. During fiscal year 2024, general and administrative expenses increased $30.4 million , compared to fiscal year 2023, primarily driven by higher performance-based compensation expense .
Logitech International S.A. | Fiscal 2023 Form 10-K | 44 Table of Contents Other Income (Expense), Net Other income (expense), net for fiscal years 2023 and 2022 was as follows (in thousands): Years Ended March 31, 2023 2022 Investment gain (loss) related to the deferred compensation plan $ (1,961) $ 1,231 Currency exchange loss, net (7,337) (4,604) Loss on investments, net (14,073) (1,683) Non-service cost net pension income (expense) and other 10,093 5,616 Total $ (13,278) $ 560 Investment gain (loss) related to the deferred compensation plan for fiscal years 2023 and 2022 represents earnings, gains, and losses on marketable securities related to a deferred compensation plan offered by one of our subsidiaries.
Other Income (Expense), Net Other income (expense), net for fiscal years 2024 and 2023 was as follows (in thousands): Years Ended March 31, 2024 2023 Investment gain (loss) related to the deferred compensation plan $ 4,320 $ (1,961) Currency exchange loss, net (8,770) (7,337) Loss on investments, net (14,674) (14,073) Non-service cost net pension income and other 2,748 10,093 Total $ (16,376) $ (13,278) Investment gain (loss) related to the deferred compensation plan for fiscal years 2024 and 2023 represents earnings, gains, and losses on marketable securities related to a deferred compensation plan offered by one of our subsidiaries.
Our cash and cash equivalents consist of bank demand deposits and short-term time deposits, of w hich 78% is held in Switzerland and 12% is held in China (including Hong Kong).
Our cash and cash equivalents consist of bank demand deposits, short-term time deposits, and U.S. Treasury securities, of w hich 71% was held in Switzerland and 11% was held in China (including Hong Kong).
Net income for fiscal year 2023 wa s $364.6 million , compared to $644.5 million for fiscal year 2022, reflecting lower sales and gross margin, partially offset by a reduction in operating expenses. Critical Accounting Estimates The preparation of financial statements and related disclosures in conformity with U.S.
Net income for fiscal year 2024 wa s $612.1 million , compared to $364.6 million for fiscal year 2023, reflecting higher gross margin as well as lower operating expenses and income tax provision. Critical Accounting Estimates The preparation of financial statements and related disclosures in conformity with U.S.
Based on our shares outstanding, net of treasury shares, as of March 31, 2023 (159,343,273 shares), this would result in an aggregate gross dividend of approximately CHF 168.9 million (approximately $184.2 million based on the exchange rate on March 31, 2023). In fiscal year 2023, we paid a cash dividend of CHF 0.96 per share, or CHF 156.1 million (U.S.
Based on our shares outstanding, net of treasury shares, as of March 31, 2024 (153,863,262 shares), this would result in an aggregate gross dividend of approximately CHF 178.5 million (approximately $197.2 million based on the exchange rate on March 31, 2024). In fiscal year 2024, we paid a cash dividend of CHF 1.06 per share, or CHF 169.1 million (U.S.
Non-cash expenses were primarily related to depreciation and amortization, share-based compensation expense , and deferred income taxes. The decrease in accounts receivable, net was primarily driven by lower sales, partially offset by the timing of sales within the quarter. The decrease in inventories was primarily driven by a reduction in inventory purchases to align with lower demand.
Non-cash adjustments were primarily related to depreciation and amortization, share-based compensation expense , and deferred income taxes. The decrease in accounts receivable, net, was primarily driven by the timing of sales within the fourth quarter of fiscal years 2024 and 2023. The decrease in inventories was primarily driven by our effort to manage inventory level to align with softened demand.
Sales for fiscal year 2023 decreased 25%, 17% and 9% in the EMEA, Americas and Asia Pacific regions, respectively, compared to fiscal year 2022.
Sales for fiscal year 2024 decreased 16% and 2% in the Asia Pacific and Americas regions, respectively, and were flat in EMEA, compared to fiscal year 2023.
Constant Currency We refer to our net sales growth rates excluding the impact of currency exchange rate fluctuations as "constant currency" sales growth rates. Percentage of constant currency sales growth is calculated by translating prior period sales in each local currency at the current period’s average exchange rate for that currency and comparing that to current period sales.
Percentage of constant currency sales growth is calculated by translating prior period sales in each local currency at the current period’s average exchange rate for that currency and comparing that to current period sales. Given our global sales presence and the reporting of our financial results in U.S.
During fiscal year 2023, research and development expense s decreased $11.0 million, compared to fiscal year 2022, primarily driven by lower personnel-related costs, partially offset by higher outsourcing expenses. Research and development expenses as a percentage of sales increased from 5.3% in fiscal year 2022 to 6.2% in fiscal year 2023 reflecting our continued investment in innovation.
During fiscal year 2024, research and development expense s increased $6.4 million, compared to fiscal year 2023, primarily driven by higher performance-based compensation expense. Research and development expenses as a percentage of sales increased from 6.2% in fiscal year 2023 to 6.7% in fiscal year 2024 reflecting our continued investment in innovation.
As of Ma rch 31, 2023, our working capital was $1,555.1 million, compared to $1,651.8 million as of March 31, 2022. The decrease was primarily driven by lower inventories, lower cash balances resulting from share repurchases and payments of cash dividends, and lower accounts receivable, net, partially offset by decreases in accounts payable and accrued liabilities.
As of Ma rch 31, 2024, our working capital was $1,545.5 million, compared to $1,555.1 million as of March 31, 2023. The decrease was primarily driven by decreases in inventories and accounts receivable, net, and an increase in accounts payable, partially offset by an increase in cash and cash equivalents.
Summary of Financial Results Our total sales for fiscal year 2023 decreased 17%, compared to fiscal year 2022, primarily driven by a decline in sales of all of our product categories as a result of lower demand and unfavorable changes in currency exchange rates.
Summary of Financial Results Our total sales for fiscal year 2024 decreased 5% , compared to fiscal year 2023, primarily drive n by a decline in sales of most of our product categories as a result of lower demand.
We had several uncommitted, unsecured bank lines of credit aggregating $181.3 million as of March 31, 2023. There are no financial covenants under these lines of credit with which we must comply. As of March 31, 2023, we had outstanding bank guarantees of $13.6 million under these lines of credit.
We had several uncommitted, unsecured bank lines of credit and letters of credit aggregating $172.5 million as of March 31, 2024. There are no financial covenants under the lines of credit with which we must comply. There was no borrowing outstanding under the lines of credit as of March 31, 2024 .
Dollar, such as the Euro, Chinese Renminbi, Japanese Yen, Australian Dollar, Canadian Dollar, Pound Sterling and New Taiwan Dollar. For the years ended March 31, 2023 and 2022, approximately 51% and 50%, respectively, of our sales were denominated in currencies other than the U.S. Dollar.
For the years ended March 31, 2024 and 2023, approximately 50% and 51%, respectively, of our sales were denominated in currencies other than the U.S. Dollar.
The increase in interest income for fiscal year 2023, compared to fiscal year 2022, was primarily driven by th e increase in interest rates.
The increase in interest income for fiscal year 2024, compared to fiscal year 2023 , was primarily driven by an increase in interest rates and increased cash equivalents balance.
Keyboards & Combos Our Keyboards & Combos category comprises PC keyboards and keyboard/mice combo products. During fiscal year 2023, Keyboards & Combos sales decreased 14%, compared to fiscal year 2022, primarily driven by the decrease in sales of our cordless combos and corded PC keyboards, particularly in our low end products.
Keyboards & Combos Our Keyboards & Combos category includes PC keyboards and keyboard/mice combo products. During fiscal year 2024, Keyboards & Combos sales decreased 2% , compared to fiscal year 2023, primarily driven by a decrease in sales of our cordless keyboards, partially offset by an increase in sales of our cordless combos.
Sales by Region The following table presents the change in sales by region for fiscal year 2023 compared with fiscal year 2022: 2023 vs. 2022 Sales Growth Rate Sales Growth Rate in Constant Currency Americas (17) % (17) % EMEA (25) (17) Asia Pacific (9) (3) Americas: The decrease in sales in the Americas region for fiscal year 2023, compared to fiscal year 2022, was primarily driven by decreases in sales for Gaming, Video Collaboration, PC Webcams and Audio & Wearables.
Sales by Region The following table presents the change in sales by region for fiscal year 2024 compared with fiscal year 2023: 2024 vs. 2023 Sales Growth Rate Sales Growth Rate in Constant Currency Americas (2) % (2) % EMEA — (4) Asia Pacific (16) (13) Americas: The decrease in sales in the Americas region for fiscal year 2024, compared to fiscal year 2023, was primarily driven by decreases in sales for mobile speakers and PC speakers in our Other category.
We recorded a liability for firm, non-cancelable, and unhedged inventory purchase commitments in excess of anticipated demand or net realizable value consistent with our valuation of excess and obsolete inventory.
We recorded a liability for firm, non-cancelable, and unhedged inventory purchase commitments in excess of anticipated demand or net realizable value consistent with our valuation of excess and obsolete inventory. As of March 31, 2024, the liability for these purchase commitments was $29.3 million and is recorded in accrued and other current liabilities in the consolidated balance sheet.
Logitech International S.A. | Fiscal 2023 Form 10-K | 45 Table of Contents As of March 31, 2023 and 2022, we had $106.4 million and $83.4 million, respectively, in non-current income taxes payable, including interest and penalties, related to our income tax liability for uncertain tax positions.
As of March 31, 2024 and 2023, we had $112.6 million and $106.4 million, respectively, in non-current income taxes payable, including interest and penalties, related to our income tax liability for uncertain tax positions. As of March 31, 2024 and 2023, we had $7.8 million and $6.1 million, respectively, of accrued interest and penalties related to uncertain tax positions.
Given our global sales presence and the reporting of our financial results in U.S. Dollars, our financial results could be affected by significant shifts in currency exchange rates. See “Results of Operations” for information on the effect of currency exchange rate fluctuations on our sales. If the U.S.
Dollars, our financial results could be affected by significant shifts in currency exchange rates. See “Results of Operations” for information on the effect of currency exchange rate fluctuations on our sales. If the U.S. Dollar appreciates or depreciates in comparison to other currencies in future periods, this will affect our results of operations in future periods as well.
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 recent declines in enterprise spending leading to reduced demand for some of our products, (iii) the uncertainty in strategy and timing of enterprises’ “return-to-office” impacting demand for our Video Collaboration and Creativity & Productivity products, and (iv) the timing of further development of our business-to-business go-to-market capabilities.
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.
(2) Other includes Smart Home. Creativity & Productivity market: Pointing Devices Our Pointing Devices category comprises PC- and Mac-related mice including trackballs, touchpads and presentation tools. During fiscal year 2023, Pointing Devices sales decreased 7%, compared to fiscal year 2022, primarily driven by the decrease in sales of cordless and corded mice, particularly in our low end products.
Pointing Devices Our Pointing Devices category includes PC- and Mac-related mice including trackballs and presentation tools. During fiscal year 2024, Pointing Devices sales increased 2% , compared to fiscal year 2023, primarily driven by increases in sales of cordless mice and presentation tools.
The following table summarizes our consolidated statement of cash flows for the year ended March 31, 2023 (Dollars in thousands): Year ended March 31, 2023 Net cash provided by operating activities $ 534,010 Net cash used in investing activities (105,730) Net cash used in financing activities (583,353) Effect of exchange rate changes on cash and cash equivalents (24,620) Net decrease in cash and cash equivalents $ (179,693) For fiscal year 2023, net cash provided by operating activities was $534.0 million resulting from net income of 364.6 million, a favorable impact from adding back non-cash expenses totaling $213.1 million, and an unfavorable net change in operating assets and liabilities of $43.6 million.
The following table summarizes our consolidated statement of cash flows for the year ended March 31, 2024 (in thousands): Year ended March 31, 2024 Net cash provided by operating activities $ 1,145,116 Net cash used in investing activities (70,335) Net cash used in financing activities (690,173) Effect of exchange rate changes on cash and cash equivalents (12,789) Net increase in cash and cash equivalents $ 371,819 For fiscal year 2024, net cash provided by operating activities was $1,145.1 million resulting from net income of $612.1 million, a favorable impact from adding back non-cash adjustments totaling $143.5 million, and a favorable net change in operating assets and liabilities of $389.4 million.
Asia Pacific: The decrease in sales in the Asia Pacific region for fiscal year 2023, compared to fiscal year 2022, was primarily driven by decreases in sales of Keyboards & Combos, PC Webcams, Audio & Wearables, and Video Collaboration, partially offset by an increase in sales of Gaming.
Logitech International S.A. | Fiscal 2024 Form 10-K | 43 Table of Contents Asia Pacific: The decrease in sales in the Asia Pacific region for fiscal year 2024, compared to fiscal year 2023, was primarily driven by decreases in sales of Gaming, Keyboards & Combos and Video Collaboration.
Logitech International S.A. | Fiscal 2023 Form 10-K | 37 Table of Contents We consider an accounting estimate critical if it: (i) requires management to make judgments and estimates about matters that are inherently uncertain; and (ii) is important to an understanding of our financial condition and operating results.
We consider an accounting estimate critical if it: (i) requires management to make judgments and estimates about matters that are inherently uncertain; and (ii) is important to an understanding of our financial condition and operating results. We base our assumptions, judgments and estimates on historical experience and various other factors that we believe to be reasonable under the circumstances.
Loss on investments, net, includes unrealized gain (loss) from the fair value change of investment, gain (loss) on equity-method investments and impairment of investments during the periods presented, as applicable.
The loss for fiscal year 2023 was primarily related to the weakening of the Brazilian Real and Australian Dollar against U.S. Dollar. Loss on investments, net, includes unrealized gain (loss) from the change in fair value of investments, gain (loss) on equity-method investments and impairment of investments during the periods presented, as applicable.
Future market conditions and product transitions may require us to take action to increase such programs. In addition, when the variables used to estimate these costs change, or if actual costs differ significantly from the estimates, we would be required to record incremental increases or reductions to revenue or operating expenses.
In addition, when the variables used to estimate these costs change, or if actual costs differ significantly from the estimates, we would be required to record incremental increases or reductions to revenue or operating expenses. Inventory Valuation We must order components for our products and build inventory in advance of customer orders.
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. From time to time, we may seek to partner with or acquire, when appropriate, companies that have products, personnel, and technologies that complement our strategic direction.
From time to time, we may seek to partner with or acquire, when appropriate, companies that have products, personnel, and technologies that complement our strategic direction.
EMEA: The decrease in sales in the EMEA region for fiscal year 2023, compared to fiscal year 2022, was primarily driven by decreases in sales in Gaming, Keyboards & Combos, PC Webcams and Pointing Devices.
EMEA: Sales in the EMEA region for fiscal year 2024, compared to fiscal year 2023, remained flat. Increases in sales for Gaming and Pointing Devices were offset by decreases in sales for Webcams and Video Collaboration.
Adoption of New Accounting Pronouncements Refer to Note 2 to the consolidated financial statements included in this Annual Report on Form 10-K for recent accounting pronouncements adopted. Inflation Reduction Act in the U.S. On August 16, 2022, the “Inflation Reduction Act” (H.R. 5376) ("IRA") was signed into law in the U.S.
New Accounting Pronouncements Refer to Note 2 to the consolidated financial statements included in this Annual Report on Form 10-K for recent accounting pronouncements to be adopted.
Gaming market: Gaming Our Gaming category comprises gaming mice, keyboards, headsets, gamepads, steering wheels, simulation controllers, console gaming headsets, and Streamlabs services. During fiscal year 2023, Gaming sales decreased 17%, compared to fiscal year 2022, primarily driven by the decrease in sales of gaming mice, keyboards, and headsets.
(2) Other primarily consists of mobile speakers and PC speakers. Gaming Our Gaming category includes gaming mice, steering wheels, headsets, keyboards, console gaming headsets, studio-quality Blue Microphones and Streamlabs services. During fiscal year 2024, Gaming sales decreased 4%, compared to fiscal year 2023, primarily driven by decreases in sales of gaming keyboards, Blue Microphones, and Streamlabs services.
ITO as of March 31, 2023 increased 0.4, compared to March 31, 2022, primarily due to a lower inventory balance as of March 31, 2023, partially offset by softened demand.
ITO as of March 31, 2024 increased by 1.8 to 5.4, compared to 3.6 as of March 31, 2023, primarily due to lower inventory balance as of March 31, 2024 resulting from focused inventory management to align with softened demand.
Overview of Our Company 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.
Company Overview 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 design, create and sell products that benefit from these secular trends. The culture 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.
We design, create and sell products that benefit from these secular trends which include the following: • 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.
We base our assumptions, judgments and estimates on historical experience and various other factors that we believe to be reasonable under the circumstances. Although these assumptions, judgments, and estimates are based on management's best knowledge of current events and actions that may impact us in the future, actual results could differ.
Although these assumptions, judgments, and estimates are based on management's best knowledge of current events and actions that may impact us in the future, actual results could differ. Management has discussed the development, selection and disclosure of these critical accounting estimates with the Audit Committee of the Board of Directors.
Logitech International S.A. | Fiscal 2023 Form 10-K | 39 Table of Contents References to Sales The term “sales” means net sales, except as otherwise specified and the sales growth discussion and sales growth rate percentages are in U.S. Dollars, except as otherwise specified.
References to Sales The term “sales” means net sales, except as otherwise specified and the sales growth discussion and sales growth rate percentages are in U.S. Dollars, except as otherwise specified. Results of Operations In this section, we discuss the results of our operations for the year ended March 31, 2024 compared to the year ended March 31, 2023.
For over ten years, we have generated positive cash flows from our operating activities, including cash from operations of $534.0 million and $298.3 million during fiscal years 2023 and 2022, respectively.
Opportunistic purchases may be started or stopped at any time without prior notice depending on market conditions and other factors. For over ten years, we have generated positive cash flows from our operating activities, including cash from operations of $1,145.1 million and $534.0 million during fiscal years 2024 and 2023, respectively.
Net Sales Our sales in fiscal year 2023 decreased 17%, compared to fiscal year 2022, driven b y a decline in sales of all of our product categories. O ur sales were negatively impacted from lower demand and unfavorable changes in currency exchange rates.
Net Sales Our sales in fiscal year 2024 decreased 5% , compared to fiscal year 2023, primarily driven b y a decline in sales of most of our product categories as a result of lower demand. If currency exchange rates had been constant in fiscal years 2024 and 2023, our sales decline in constant currency would have been 6% .
Included in the income tax provision of $98.9 million and $131.3 million in fiscal year 2023 and 2022 was $48.3 million and $88.7 million, respectively, of tax expense from Switzerland.
Logitech International S.A. | Fiscal 2024 Form 10-K | 40 Table of Contents Included in the income tax provision of $9.5 million and $98.9 million in fiscal year 2024 and 2023 was $20.7 million of tax benefit and $46.0 million of tax expense, respectively, from Switzerland.
In fiscal year 2021, we paid a cash dividend of CHF 0.79 per share, or CHF 134.0 million (U.S. Dollar amount of $146.7 million) out of fiscal year 2020 retained earnings. 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.
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.
If the examinations are resolved unfavorably, there is a possibility that they may have a material negative impact on our results of operations.
If the examinations are resolved unfavorably, there is a possibility that they may have a material negative impact on our results of operations. Liquidity and Capital Resources Cash Balances, Available Borrowings, and Capital Resources As of March 31, 2024, we had cash and cash equivalents of $1,520.8 million, compared with $1,149.0 million as of March 31, 2023.
DSO as of March 31, 2023 increased by 10 days to 59 days, as compared to 49 days as of March 31, 2022, primarily due to lower revenues resulting from softened demand, partially offset by timing of sales within the quarter.
DSO as of March 31, 2024 decreased by 11 days to 48 days, compared to 59 days as of March 31, 2023, primarily due to the timing of sales within the fourth quarter of the fiscal years 2024 and 2023.
The decrease in accounts payable was primarily driven by the reduction in inventory purchases. The decrease in accrued and other liabilities was primarily driven by a lower annual bonus accrual and lower marketing spend. For fiscal year 2023, net cash used in investing activities was $105.7 million, primarily due to $92.4 million purchases of property, plant, and equipment .
The increase in accounts payable was primarily driven by an increase in inventory purchases to replenish certain products during the fourth quarter of fiscal year 2024 . For fiscal year 2024, net cash used in investing activities was $70.3 million, primarily due to $55.9 million purchases of property, plant, and equipment .
Logitech International S.A. | Fiscal 2023 Form 10-K | 41 Table of Contents Video Collaboration market: Video Collaboration Our Video Collaboration category includes Logitech’s conference room cameras, which combine affordable enterprise-quality audio and high definition 4K video to bring video conferencing to businesses of any size, as well as webcams and headsets that turn any desktop into an instant collaboration space.
Video Collaboration Our Video Collaboration category includes Logitech’s conference room cameras, which combine affordable enterprise-quality audio and high definition 4K video to bring video conferencing to a variety of room sizes.
Logitech International S.A. | Fiscal 2023 Form 10-K | 38 Table of Contents We record inventories at the lower of cost and net realizable value and record write-downs of inventories that are obsolete or in excess of anticipated demand or net realizable value.
Further, our industry is characterized by rapid technological change, short-term customer commitments and rapid changes in demand. We record inventories at the lower of cost and net realizable value and record write-downs of inventories that are obsolete or in excess of anticipated demand or net realizable value.
As of March 31, 2023 , $505.8 million was available for repurchase under the 2020 repurchase program.
As of March 31, 2024, $635.8 million was available for repurchase under the 2023 share repurchase program. Swiss law limits a company’s ability to hold or repurchase its own shares.

… 68 more changes not shown on this page.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

4 edited+0 added−0 removed10 unchanged
Biggest changeThe adverse effect as of March 31, 2023 and 2022 is after consideration of the offsetting effect of approximately $8.1 million and $15.9 million, respectively, from foreign exchange contracts in place as of such dates. We enter into cash flow hedge contracts to protect against exchange rate exposure of forecasted inventory purchases. These hedging contracts mature within approximately four months.
Biggest changeThe adverse effect as of March 31, 2024 and 2023 is after consideration of the offsetting effect of approximately $6.9 million and $8.1 million, respectively, from foreign exchange contracts in place as of such dates. We enter into cash flow hedge contracts to protect against exchange rate exposure of forecasted inventory purchases. These hedging contracts mature within approximately four months.
If an adverse 10% foreign currency exchange rate change had been applied to total monetary assets and liabilities denominated in currencies other than the functional currencies at the balance sheet dates, it would have resulted in an adverse effect on income before income taxes of approximately $17.0 million and $24.4 million as of March 31, 2023 and 2022, respectively.
If an adverse 10% foreign currency exchange rate change had been applied to total monetary assets and liabilities denominated in currencies other than the functional currencies at the balance sheet dates, it would have resulted in an adverse effect on income before income taxes of approximately $19.1 million and $17.0 million as of March 31, 2024 and 2023, respectively.
We transact business in approximately 30 currencies worldwide, of which the most significant to operations are the Euro, Chinese Renminbi, Japanese Yen, Australian Dollar, Canadian Dollar, Pound Sterling and New Taiwan Dollar. For the year ended March 31, 2023, approximately 51% of our sales were in non-U.S. denominated currencies, with 23% of our sales denominated in Euro.
We transact business in approximately 30 currencies worldwide, of which the most significant to operations are the Euro, Chinese Renminbi, Japanese Yen, Australian Dollar, Canadian Dollar, Pound Sterling and New Taiwan Dollar. For the year ended March 31, 2024, approximately 50% of our sales were in non-U.S. denominated currencies, with 24% of our sales denominated in Euro.
If the U.S. dollar had weakened by 10%, the amount recorded in AOCI related to our foreign exchange contracts before tax effect as of March 31, 2023 and 2022 would have been approximately $7.3 million and $12.5 million lower, respectively.
If the U.S. dollar had weakened by 10%, the amount recorded in AOCI related to our foreign exchange contracts before tax effect as of March 31, 2024 and 2023 would have been approximately $9.0 million and $7.3 million lower, respectively.

Other LOGI 10-K year-over-year comparisons