While many companies want to improve the proverbial mousetrap, Logitech International is more concerned with making a better mouse. The company is a leading maker of mice and other devices for controlling computers, including joysticks, trackballs, digital pens, and keyboards. It makes more than a quarter of its revenue from pointing devices. Its LifeSize unit offers HD videoconferencing equipment that includes phones, cameras, microphones, and headsets. Logitech sells its products directly to manufacturers -- including most of the world's largest PC makers -- as well as through distributors and retailers worldwide. Europe, Middle East, and Africa account for more than one-third of sales.
Logitech has used acquisitions to build its videoconferencing product line. The company purchased Milan-based mobile videoconferencing software developer Mirial in 2011 to tap the booming global smartphone market. It bought LifeSize Communications for $405 million in cash in 2009, further extending its reach into video communications and videoconferencing. LifeSize's products include the Passport, a small business videoconferencing system touted as a less expensive alternative to similar equipment from Cisco Systems and Polycom. LifeSize became a division of Logitech. The company acquired the assets of Norway-based network firewall and network address translation product maker Paradial the following year. Paradial's technology was incorporated into the LifeSize product line to enable more reliable video communications over secured networks.
Logitech's Ultimate Ears division develops in-ear monitors used by on-stage musicians and engineers. It also targets the consumer market with in-ear devices designed for use with portable music players. Logitech additionally provides Internet-based videoconferencing services through its video communications software unit, SightSpeed.
The Logitech product line extends beyond the PC platform. It makes devices for popular third-party products like Apple's iPod, and gaming systems from Nintendo and Sony. The company also offers a line of universal remotes for controlling multiple electronic devices.
Logitech is focusing product development on tablets and other mobile devices, which has recently resulted in the Logitech Keyboard Case for the iPad 2 and wireless portable speakers. The company also believes that its LifeSize family of videoconferencing products will enjoy more growth. Logitech is additionally targeting expansion in China, Eastern Europe, India, and Latin America.
Revenue rose 20% in fiscal 2011 compared with 2010 thanks mainly to strong sales in Asia/Pacific, especially China, as well as the Americas, and -- in line with expectations -- good results for the company's LifeSize products. Amid the global recession, the company had reduced its workforce in 2009 by 15%, hoping to save about $50 million.
Logitech has high-volume manufacturing operations in China that handle roughly half of its production; the company outsources the rest.
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