Logitech International LOGI is slated to report fourth-quarter fiscal 2023 results on May 1.
The Zacks Consensus Estimate for fourth-quarter fiscal 2023 revenues is pegged at $895.2 million, indicating a decrease of 27.2% from the year-ago quarter. The consensus mark for non-GAAP earnings stands at 42 cents per share, suggesting a significant decline of 48.5% year over year.
The company’s earnings beat the Zacks Consensus Estimate twice in the trailing four quarters and missed the same on two occasions, the average surprise being 0.7%.
Let’s see how things have shaped up before the upcoming announcement.
Logitech International S.A. Price and EPS Surprise
Logitech International S.A. price-eps-surprise | Logitech International S.A. Quote
Factors to Consider
Logitech’s fiscal fourth-quarter earnings are likely to have been negatively impacted by the declining demand for personal computers (PCs), the main sales booster for its PC peripheral products. Per the latest International Data Corporation report, worldwide PC shipments declined 29% year over year to 56.9 million units in the first quarter of 2023.
In 2020 and 2021, Logitech benefited from the elevated demand for its video collaboration, keyboards & combos and pointing device tools, mainly driven by the heightening of work-from-home and learn-from-home trends. Additionally, the demand for gaming products shot up due to the growing popularity of online video games and eSports amid the stay-at-home scenario. However, the demand softened due to the reopening of economic and business activities.
The company witnessed a significant sales decline across all its product offerings in the last reported quarter. In the previous quarter, revenues from the Pointing Devices, PC Webcams, Tablet and Other Accessories, Audio & Wearables, Keyboards & Combos, Video Collaboration, Mobile Speakers and Gaming product categories plunged 13.8%, 49.2%, 21.4%, 33.7%, 21.9%, 21.2%, 32.5% and 16.5%, respectively.
Additionally, enterprises are postponing their large IT spending plans due to a weakening global economy amid ongoing macroeconomic and geopolitical issues. This may have hurt Logitech’s overall financial performance in the fiscal fourth quarter.
However, reduced operating expenses are likely to have partially offset the negative impacts of the aforementioned factors on profitability.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for LOGI this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. However, that’s not the case here.
Logitech carries a Zacks Rank #5 (Strong Sell) and has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks With the Favorable Combination
Per our model, Skyworks Solutions SWKS, Garmin GRMN and Model N MODN have the right combination of elements to post an earnings beat in their upcoming releases.
Skyworks carries a Zacks Rank #3 and has an Earnings ESP of +0.15%. The company is scheduled to report second-quarter fiscal 2023 results on May 8. Its earnings beat the Zacks Consensus Estimate in the preceding four quarters, with the average surprise being 1.9%. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Skyworks’ second-quarter earnings stands at $2.02 per share, implying a year-over-year decline of 23.2%. It is estimated to report revenues of $1.15 billion, which suggests a decrease of approximately 14% from the year-ago quarter.
Garmin is slated to report first-quarter 2023 results on May 3. The company has a Zacks Rank #3 and an Earnings ESP of +5.79% at present. Garmin’s earnings beat the Zacks Consensus Estimate thrice in the trailing four quarters while missing the same on one occasion, the average surprise being a negative 7.3%.
The Zacks Consensus Estimate for GRMN’s first-quarter earnings is pegged at $1.00 per share, suggesting a decline of 9.9% from the year-ago quarter’s earnings of $1.11. Garmin’s quarterly revenues are estimated to decline 7.9% year over year to $1.08 billion.
Model N carries a Zacks Rank #3 and has an Earnings ESP of +7.14%. The company is slated to report second-quarter fiscal 2023 results on May 9. Its earnings surpassed the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 40.8%.
The Zacks Consensus Estimate for MODN’s second-quarter earnings is pegged at 17 cents per share, indicating a year-over-year increase of 21.4%. The consensus mark for revenues stands at $59.4 million, suggesting a year-over-year increase of 11.5%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report