Wedbush Shaves FY '20 Sales Projections for Logitech Over Tariffs, Lower Gaming Revenue

Wedbush Securities scaled back FY 2020 revenue projections for Logitech to $2.95 billion from $2.97 billion, citing Q2 results, more impact from tariffs and lower revenue growth in gaming in the holiday quarter. After Logitech’s Tuesday Q2 report (see 1910220028), analyst Michael Pachter said in an investor note it’s unclear if the holiday quarter will fare as well as Q2 where Logitech had a 4 percent revenue bump to $720 million, but “it is prudent to err on the side of caution.” While maintaining an “outperform” rating, Pachter noted Logitech expects to pull forward inventory ahead of List 4B Section 301 tariffs that may be implemented Dec. 15, to relocate more manufacturing or to raise prices “where appropriate.” Logitech reaffirmed FY ’20 revenue guidance of mid-to-high single-digit sales growth Tuesday but didn't break out guidance for the holiday quarter.