Shares of Logitech (NASDAQ:LOGI) plunged Friday morning as shareholders expressed dismay after the world’s largest computer mouse maker took an axe to its financial guidance.
Blaming weak sales in its Europe, Middle East and Africa segment, Swiss-based Logitech said late Thursday it expects its fiscal 2011 operating income of $140 million to $160 million on sales of $2.35 billion to $2.37 billion. Previously, Logitech said it expected profits of $170 million to $180 million on sales of $2.4 million to $2.42 million.
Wall Street had been calling for profits of $177.15 million on sales of $2.67 billion from Logitech, which also makes keyboards and other PC accessories.
“Logitech has experienced lower-than-expected demand for its retail products in [Europe, Middle East and Africa] from both distribution partners and consumers,” Logitech said in a statement.
Shares of Logitech tumbled in the wake of the new guidance, diving 16.96% to $15.03. The losses shoved the stock into negative territory on the year, leaving it down 2.2% in 2011.Analysts also responded negatively, with Credit Suisse downgrading the stock to “neutral” from “outperform.”
"While Logitech provided few details, the root cause of the miss appears to be demand rather than channel dynamics. If so, a quick fix seems as unlikely,” Oppenheimer analysts wrote in a note, according to Dow Jones Newswires.