Logitech lowered its guidance for 2009 and announced it will cut 15 percent of its non-production workforce, or around 525 jobs. The computer peripheral maker says it's hit by the deepening global recession, and explains the retail environment deteriorated significantly during the December quarter.
“During the December quarter, the retail environment deteriorated significantly,” said Gerald P. Quindlen, Logitech president and chief executive officer. “We experienced varying degrees of weakness across all geographies and channels as our customers reduced inventory levels in the face of weaker consumer demand. Moreover, we expect the economic environment to worsen in the coming months and we are therefore taking significant actions to align our cost structure with what is likely to be an extended downturn.”
In addition to ongoing actions aimed at reducing operating expenses, the Company plans to reduce its salaried workforce globally by approximately 15 percent. The associated restructuring charge will be announced with the Company’s Q3 FY 2009 results and booked in the fourth quarter of FY 2009. The Company expects that the savings from the restructuring will begin to show in the first quarter of FY 2010.
“Although the external environment is more challenging than anything we’ve experienced before, we believe Logitech is very well positioned to manage through this downturn,” continued Quindlen. “We have a strong cash position, no debt, and we continue to maintain market share across multiple segments and geographies. We remain confident in our strategy for driving long-term double-digit growth and we believe the well-considered actions we’re taking now will result in an even stronger Logitech when the economic recovery begins.”