Logitech International (LOGI) 24 Oct 172018 Q2 Earnings call transcript

Good morning. My name is Sharon and I will be your conference operator today. At this time, I would like to welcome everyone to Logitech’s second quarter fiscal 2018 conference call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question and answer session.

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Bracken call Darrell, Financial are Officer, today the Vincent us Pilette, Chief I to Executive over and President Joining turn and Officer. Bracken. now Chief will

of joining us. Thanks and thanks to all Ben, you for

grew there we performance, first and true. improvement as years, but been few most we quarter, our gaming for many more past we’re say profits expanding half strategy, I new ones, some to console to investing were simply systematically operating much extent double executing could digits, that’s categories existing This have Overall, profits always for were so our recently we’ve in capabilities in sales up sales have that from areas gotten the our the and into headsets. XX%. and and doing and

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going its high global also expanding expanding quarter very just we’re additional million. portfolio XX% bring to the collaboration to impressive forward distribution, quarterly Astro Video up though; $XX is Astro’s had with aren’t that sales of record ahead. a We looking I’m and to another opportunities

run invest December capabilities MeetUp. our XXXX, a and rate to million annual us rate $XXX approaching great products, - million here and sales the our We tuned. half over in annual three to go-to-market milestone back in continue is a later just create run reach $XXX stay It of year took years and like sales

delivered group Home Smart strong Our performance. another

system of the the here Hub the Home opportunities We have of a us. Alexa and long-term view and Harmony line products, Google Smart in as market of from set we for benefitted too integration

PC new mentioned security unqualified the WONDERBOOM nascent fell an our the X% market the the long our as pint-sized our ramp this hit this and prospects sales time, X QX. speakers Audio, to Mobile flat prepared in wearable see as line-up, At quarter were wait of remain well. and powerfully. earlier. market early for but and as excited rollout same term of about still do. entered MEGABLAST latest It’s can’t for Circle what BLAST We’re camera in we I the

where about growth, As super runner we’re Jaybird we portfolio the myself, I and for stated term last a am excited we’re quarter, long going. as positioning

stable second PC trend? know Sales Our early new come do making deliver were we overall. new well, grew XX%, PC Still and What large innovative taking up other were flattish is this products XX%. keyboard combos up quarter PC say. tablet too very webcams we the strong of growth. base. when and offerings, growth. performed were peripheral the devices in Tablets row Is install a double a digit Pointing advantage X% sales it out while I consistently accessory of to that and keyboards with and

over I’ll to the Vincent. call Now pass

up better than in sales quarter and constant digit net Thanks another operating growth, income posted currency XX% XX%. Bracken. consistent non-GAAP We of double expected, up with

fully the range of now growth to our point. Astro, Astro almost which portfolio new marginally to quarter, we September, all With ambition. best integrated integrated in we’ve less and sales fully of have great growth on ever was than contributed had across products only deliver categories, a that our this a

new of points based all in also experienced operating In top term the margin periods. in while additional down party in fulfillment XX% XX%. this costs our know, procedures non-GAAP somewhat allowed categories. in gross you in the adding center Americas target to long near to savings was the in but our range us invest digit Gross numerous We margin gross neutral As our distribution to costs by Currency ramping to the end are reached and these our across party other new growth. in is challenges of cost year-over-year, line distribution early XX product range. challenges XX.X%, related high-single significant impacted at the promotions center our basis support transition growth the was with third in on to QX, model products of margin and a financial transition high still and third quarter, QX. The QX

ratio Looking to capabilities ahead, while are committed of range we XX% our and XX% whether annual gross sales XX% margin margin with opportunities, rose the to investing investing managing or XX% to our $XXX for fully operating million they of sustainable in growth opex are target sales, expenses within to and XX%. line our into business operational gross non-GAAP were of related. midterm In QX, of opex

would our Astro Excluding Gaming, operating expenses X%. have increased

our Our invested we increased the capital of marketing our respectively at time, and QX from drive $XX sales. and spending, to ahead down in expenses we R&D was as XX of in to the continued XX% basis X.X% flow operations leverage sales G&A points holiday Cash and XX% million working while same in season.

we had back last saw we year flow quarter, year very seasonality cash As is our this XXXX. what in mentioned fiscal to similar

should half compared non-GAAP from should our full half, income. time flows cash one improve You to first expect the our see our to second be year approximately such operating cash operations that flow

$XX to last million by form As of investing it buybacks. we spent stock. paid I’ll With we details, the million in business, which the worth is year, cash to from Bracken, growing tuck-in $XXX million quarter, turn for $XX out a priority those first and finally followed the fiscal paid million of comes use the also up dividends, our our dividend acquire Gaming, $XX acquisitions Astro repurchased you. and opportunistic In that we we back of in in a reminder,

me deliver Thank Through of at our guidance. first our are the the previous half, high strong ability we the our year, operating you, which to range for the end Vincent. gives in confidence

created new of what enhanced is a innovative line-up ahead products good quarter team momentum. and us in has I’m and right Our of terms both our seasonal proud and have we capabilities. of biggest good

of We’re ready your $XXX of XX% our year Operator, I please guidance in With up. to are maintaining queue to constant Vincent XXXX currency $XXX and XX% now fiscal million. them and questions. operating income for sales million that, growth non-GAAP

comes from Your UBS. from question instructions] first Joern [Operator Iffert

open. Your line is

center in the the in it fiscal on correctly. Hi, questions. Americas? would in would roughly question are and of last second here I but we specify there I distribution of taking the on could versus QX understand I third half, with half. is into from July on gross with a was weakest know I think the quickly the the profit remember Can expecting some thanks be gross good was and range you wireless weakness? sell-through there you what XXXX? will second because the margin said going question investment this seen plus-X%, speakers. clean-up, margin front-loaded Thanks I what sell-throughs for if remember have first product you year my to very the in profit reaction half data particular you us be be the sell-through XXXX, any for party name is was May lot. to share contributing which for Last start gross so the quarters, correctly, what Would Second was set-up, profit please one It if couple impact margin.

take I’m you. some have of I’m going on comment me at our looked data selling attempt up so X% questions. Americas at few who Bracken sell-through, for website, versus the on up to give in Okay, is let XX%. first slides can the an those sure Yes, our

the overall Some channel is and products impacted education the through we’re right as demand, channel, that selling of an the between There we always our not the position. It range QX, compared manage the holiday and data demand we match going indicator. channel have feel confident so includes from data for middle pretty channels. an also, feel that target the of about the That’s up for to the our we the that season. we see the are we as sell-through. When best and moved tier up on reasonably through. Remember into exact is timing some sell proxy position of sell-out, size center sell-out. on distribution and to is Overall, into of hand feels selling, global Overall comprising manage marginally channel. business, the on mainly where moving weeks transition and depending our also Sell-through through, of we XX% (indiscernible). the versus was going the product a in we the and good by feel in good how the company, the for well on selling positioned sell give into two not XX% we

and but We to cycle, be margin by to the level, within margin we do you part quarter, around dimensions our as - center. gross we so two the XX%. Bluetooth definitely indicator. we level gross quarter within Seasonally, gross the size plenty a or side, normally margin was half, of product costs feels of promotion of XX think, different saw. On a I so those events the know, one a another higher from comment at right distribution range that into the going Then and speaker but mobile over of to for higher there’s and gross you guide you a any quarter normally was will we of was incremental the of new lower not mobile margin as impacted promoting saw sell-through transition there then prepare margin part margin. by either mentioned quarter impacted QX target things, the the the the is our level ASP promotion range new products, of the was data as QX speakers, I’m gross declining going by course overall of gross quarter, Joern, impacting second - as being not

then, ask wireless QX XXXX? was I of speaker through of in the may sell negative So also

in know, the launched also--sell-through we and in MEGABLAST AP, in mainly EMEA. a was and in and Americas was BLAST and you Europe. It also Yes, then countries both as positive few negative U.S. it was in

All right, thanks very much.

Thank Joern. you,

question Merchant from Your Asiya comes next Citigroup. from

line Your is open.

you? Hi Bracken, hi are How Vincent.

there, Hello terrific.

in Great. for I going but our have segment a gaming complete expectations were that relative of bit, how to already little acquisition what follow-up Can doing analyst we is on your are about half? just you know And at guys the gross forward? your should great gaming question now Astro a think kind I line-up, the day talk and second margin. set you that a expectations well, have so the is year, earlier

in by good I market Okay, we’re quarter, we guide by give course the half very but more don’t didn’t half. I strong say feel world. gaming good if about we it’s well that think--I around well gaming. I we back continue across I would market but we strong really overall within expect the say would of the numbers, segment have strong wouldn’t category growth just a of same, be very, board had would the the in exact performing second and to surprised Every through and growth and and

about little actually just our And in on those - three categories, you to color, more so positioning across markets, markets, bit ways at we growing of structurally day gaining in and adjacencies. and Asiya, our a product grow give to analyst talked gaming, adding share of then the all

You can maybe three all delivering see our expectations. gaming that perfect versus and levers when framework are out-delivering in

gross guys bit which design at margin guys for where ranges guiding how there, you impacted, day been for? expand and runway you seeing initiatives great. implication now analyst in Can range, been initiatives in Then kind of about little guys about talked going if design the talked positive talked That’s - obviously products you’ve the the we the you and guess--you have able it’s we invest cost you’re much are is day, what your was a margin, you about your to the the about for at to--while more that on cost gross margins, how talk know, business. I Vincent, that’s to that confident relative should further that analyst you be the guys

I wouldn’t you Yes, and add really be you want anything here. well Vincent, can specific,

While new is we XX% those, we’re year our margins zoom past of have I a if doing, goal would individual the a really the for roughly time be wouldn’t what product, time, products, better this out to exactly or versus and every specific you sure. gross be on that’s launch XX% second, of equal which up

categories about now. we’re have very average, doing same the the launching, company that principle consistently that we’re New we and

that continue think going I to forward. do we’ll

Okay, thank you.

you. Thank

Your Tavis James. from McCourt next Raymond from question comes

Your line is open.

Tavis. Hi

Hey, how you Bracken? doing,

Terrific.

exact can the don’t in was third Then Is was turns center A or qualitatively, be. normal cost couple of just the kind but year. you’re tell your inventory party guidance temporary Vincent, kind give questions. of to your guess of DC, about locations? U.S.? this of moving talk doing exactly us layer and sense on inventory, flow, want was distribution with return an impact, you I to to that the of end us what extra by suspect how it it physical Just the you you cash DSOs may your expect this some from I the

that I a this feels look know ’XX. I In some Bracken, or a better it to we you had and on exit. all the think for the working chance few quarters ago still guys like was year a potentially you a this was the run looked product rate, Should trend, cash a momentum, category feels puts this capital year operations it’s and one but changes. you. getting of of two think takes get to haven’t would as years or think Then last business? call like--I segment, I don’t in want a to was Home question good run below it a flow where kind from it had rate for at

of brand, segment, there, think with Harmony there Home specifically? your Circle brand, within segment kind Smart wondering, I products ambitions that the are I’m you--are else So what got what Home and the growth the there, other within are you’ve

Okay.

Good, will let me Bracken answer quickly the and product take the financial questions. questions,

So our distribution response on the to center, really it’s a growth.

cost a for and areas. more to facilities. bigger needed an it’s last basically growth path came As The It’s provider we four the years, layer of logistic third and been on the and we’ve in extra you many flexible bigger different U.S. know, moving have into in of facility. a party accelerating

of parallel some The and of (indiscernible) budget. distribution the in also transition logistics, the we came first transition. handing old were the our one, and manage we course, kept operational had the to frame. form We overall challenge is in to in more had time than It

would the item this is go of We expect QX, we QX, which quarter regulate costs quarters. to kind one-time so into so you a it’s be QX process two over as continue for and those would the in QX, into know, as I incremental going that biggest P&L.

are flow cash flow, In numbers. approximate directional don’t we terms of cash really but We the give those a guide think.

feel the view from paid to was a an QX, fiscal changes annual flow one-time higher to non-GAAP we is beginning it flow. because good plan last growing moved we paying income a the of expect regulate than cash overall an really so of as that going and where That we’ve would cash a our a we linked time linked one-time new say in which QX so six terms that, to to been we days been cash this basis, fact for item catch-up holidays. that approximately the the course, plan More has you call, confident to to sell there in into at products growth we and inventory, compensation the As month year. here ahead and year-over-year, mentioned, of annual so last this annual of and that we in so of flow know, holidays. item of year-over-year is inventory I the the said, incremental introduced has we is on to capital half post-QX. for one year QX, working The moved through mentioned is as have proxy in only view, operating product only the year

last home, got integrated last think home. still but and got operate with We’ve three of Home. inside your also three is which week go Alexa we have I but with Bluetooth question Circle interestingly Harmony, X, that as which Google the so about you ramping, the just we’ll for different three on so things, quarter Home. launched have not To now as speakers products really the position mentioned, Home, we not We’ve answer now speakers Wi-Fi us only that the significant it’s things only can we the those in happening have as

forward, always Going looking agree think actually I that the too in a place at with there, maybe in experimented we’re experimenting. a than Tavis. overall, never We’ve grown we makes would as sense if crazy developing you different and step things, of new stop a products Home. continue careful I the to the will some with Home has to and We back lot slower to little many say in to I every people already We’ve us. this, most I and think going participate try of not thought. experimenting for go we’re been Home in but places marketplace be

I’m about No, when four ago to tried Home it’s now optimistic the am years excited long-term wasn’t I I forward. going Harmony, yes, good play a think I it but us. for about sell So I and

much very Great, details. the thanks for

you. Thank

Baruah question next from Ananda comes Your Loop from Capital.

is open. Your line

Hey Ananda.

Hey How you? morning. guys, good are

Good.

to the the Congrats me, for if market. pretty the around. about spoken all much Bracken, recently solid you A come have and pretty like sound enthusiasm you a of kind could. across lot you’ve board product on energetically offerings that a Awesome. of few quarter portfolio, have I on

about that’s is sounds with momentum is landing - like the it it’s refresh speaker upcoming, across incremental - you’re way me that you’re talked energetically actually--well, growth this pretty and term excited You’ve my businesses. your mobile about

that’s and you’re that, of drivers, some a doing the least there your us give will the Thanks. aspects going guess ’XX, think to however first you I we accurate interpretation fine, as sort think my walk--at different more into think is heading as but could we know thing, and I then about just an of business So not then in follow-up. that and part, have be you’re guide, about--and context on important I totally you that the comfortable

launches thanks fueling Okay, Yes, been I reverse we’ve best we since a the time. line-up category, been them really so thing feel have Why The take across and new order? happened line-up do two Ananda. last I do the super-exciting quarters cool that. exciting continually every about that we’ve got here, within in really it’s is really the have product I’ve like now

not sure to momentum incremental how momentum, that except collaboration I’ll Bluetooth those to say exactly almost categories, this XX% quarter react speakers it Bluetooth two launched You in our built just have quotation not now, that the of good in. grew we grew have at growth gaming our we if we business, but it that to put our and XX% they new and so I’m very know, also - video and Alexa are are only speakers they're marks, Wi-Fi look

year can standpoint, before but something gauge to last term, year the the So the not it we’re on we I position we’re the that does marketplace, going and or in same right have just a to how consistently that, we’re know difficult more like executing, challenges lot of cool things next think, very bet going all you do is or a now. year taking I I know don’t from to for and products for this thing year. well but product long strong really us relative

I the faces we about into that shared but can know incremental I at the analyst incremental the we different and as of add, thing, decide difficult the point company which this the not term. in. definitely do to opportunities it’s than to projects about to do. more in in At time, markets are long We the I I tell you, If don’t momentum have that can just feel definitely progress which set Ananda, opportunities momentum projects on day, we really, good really

my It super of is follow-up, like rev with sounds March just there from you be or context, That’s cost center, might. regard some but sort resolves Vincent, Will a where--this but net like revenue opportunities quarter well? itself. the That’s cost net headwind that of as is It like get sort to quarter you’re opportunities, it that? there’s benefit and the through term, as awesome. distribution just sounds when saying drag guys. will say definitely helpful have you maybe you sounds Then

Yes, issues I it’s feel is an leaving some where much think channel the perspective. time. pretty finished more of product the we it operational had and table incremental the impact, cost. there on from We’ve selling much the reason revenue through a because mention in I (indiscernible), We good terms not is QX on of moving more

incremental mentioned, that’s--the of U.S. bit impact distribution been is mentioned lower the we a it reason in progression QX, some it through in it I main the parallel that’s in the as was centers as there sell because will Joern then that address QX. cost Now was in channels, products through QX to so be in will two run the demand little and and through be

then a quick it, gross follow-up Got and margin. on the just

sounds you of like I accurate? that have have margin, and if stronger, doing, gross it another things headwinds gross street well, some sort been you the potentially even my quarter So So the (indiscernible). absorbed think Is of said expectations as way, you some to is weren’t were beat margin strong. gross guys margin doing expectations, obviously would you this

organic of already maybe at basis? gross the you right range margin pushing on are end high So an the up

now when work We then guys to I room levers look Every don’t okay, QX how we quarter, and too say, etc. we overall focus you’re in understand week specifically. continue through result how compete, don’t better a we we you’re to headwinds. of we structure, costs build have I on lot headwinds margin, you the know. product and it through at our and gross easy, create way every know want face our how oh, we do day, much looks report, all can saying and and I every facing our

our are at end and our feel We We we long range. about high operating good range of are that today the within where term range.

Awesome, appreciate a Congrats it. and Thanks good guys. lot luck.

Ananda. Thanks

Your from Mainfirst Bank. next question from comes Jurgen Wagner

Your is line open.

there. Hi

run Yes, are revenue the mentioned in positioning. Jaybird, was hi. quarter? taking Thank What the On positive for on rate that you you you the question. the

by overall speak don’t we So itself. Jaybird

our know, you but on numbers category we specifically. wearable we As the don’t in it’s posted call Jaybird and all website, out the

hedging your recently, exposure, policy? FX changed A and has is that second question what on

so in in beneficial a I the it’s currency euro I’m want. one-on-one, favorable so in yet quarter, I if not have us, question the or sure but will to the was Yes, you received

the to months with pound one, impact moved currencies globally, the the current - unfavorable on Japanese way quarter. hedge as Chinese the the than any be that material mix and you and the currency has other All other didn’t have that euro. we fact overall balanced all know, when for forward, were four in currency, currency Now, currency, looking

Okay, thank you.

you. Thank

from comes Coster question Morgan. next JP Your Paul from

is Your open. line

rate. keyboards for now of moderated Yes, question. ’XX, what’s many to just in Can and the low the beginning the thanks the we’re of or have ’XX, growth saw was whether you normal in growth now in seeing thought what what expect taking there surge and single for explain toward should think digit growth of maybe really, device us we would We through seems I happened late--in moving something and a is what have forward?

can pretty cool, a now, keyboard be slowed will a look business, still down you’ve market. keyboards the to you’re haven’t I It’s yet, an know in we’re got years keep see where--you probably category. but--. has in world where If driven I just Craft in People and doing player. is it the into going that, enough, you’ve AR but seen we to market Even products years we’ve if we convinced before out innovate in out think, things keyboards, Paul, been I launched growth if keyboards world have that interesting market few using You our it’s and itself. from and I’m I even so to keyboard, know, by significant continue really that we definitely that imagine which keyboards, don’t in going more know, a the than particular, launched a

yes, is the I we’re keep going things So going stable, a base install think so We’ve it. time. of to innovating is end base in business, alive as and have I stays in good as the well, and stable, I to think oven think the keyboard really day the all and the long market install the got cool the pretty keyboard we’re at

of digit category. in saying three that future you product well? fiscal in just the little that couple come the to for then, you would at last kind double some cycle growth growth quarters, back quarters that Maybe saw deeper and function that of feasible year a Are you of bit quite just that’s a that, a as into it’s point

say is be think on I’d emphasis do to an by lot know, hesitant set, ever multi-device so You as of double put in driven a but growth expectation we that the that we’d digit growth keyboards. hit keyboard an I market

and a more multiple that those and more keyboards, are people things using good innovation. really know, was in You

will forward. structurally we’ll I to growth How doesn’t it it’s install but and even that, the say, innovations much. at think PC get drastically out very like it’s get of going we or that? of much how downward It’s for just much for all, healthy really think I base, me hard will out look good have we trending

keyboards continue will I think be our opportunities good. to in

March, the initially of some category. single analyst the Paul, Pc We at always in if year. did not far as can categories opportunity move we we a came growth day mentioned, look the NPIs, of we few that we add we that timing year a low saw rate it peripheral kind we can product and those the you have keyboards, where so but I in digit will probably when down. and and product into positioned digit think company, so this up on, those Depending of that double the things, in innovation, everyone we see before, cycle, at tell

We that can webcam, in rates single never double come around those know. target up and model forever Some perform to good opportunities. advise new pretty categories find I but webcam, growth we’re better digit digits, you products Overall low XX%. peripheral, would can we’ve - not been with PC up you always range.

It’s question Paul, so nice, about keyboards the have to call. a on

question Foeth Michael Vontobel. from comes from next Your

is open. line Your

Hi Michael.

Michael. Hi

as are Yes, my from well. Two regarding questions How Jaybird side hi. you?

of what new before off, seem my is so there seen a because potential to and quarter, really we’ve and terms it with is high question U.S. In the take that were do would cool and it. but think finds positioning performance, terms, first I products, yet, not last how reposition in Jaybird sort it the really terms the I disappointed distribution thought takes that you question and you everybody in the how this Jaybird of of about be of doesn’t channels, have in will product, long think accelerating you be it pretty but obviously to sell you done

Spotlight you on contribution the presenter. an significant Thank second sort us give again? you. could Any it and quarter, is of if momentum one update The or in your accelerating is it has lost

Yes, so I’ll also Bracken comment. take answers can then a (indiscernible) few and

both that the of broadly through. let’s hey, brand go and positioning value every process what environment brand, with side, so On really from we’re the call vectors brand, are the quarter the the the success, aligning we on say, long launch that different along is approach not to distribution for product focusing perspective re-evaluating a an and that. in portfolio to all really We and it’s right on last acquisition mass distribution decided Jaybird it Jaybird we push term the said it were and position of we a that it in so

what time very specific want easily sure to I product Run and many doing don’t we I’m You products. love be it, the than we’re extrapolate of use all to and that. customers distribution. and the saw It’s a Run our you too all I the do more way I launch of how think from too. really much brand positioning very we’re the can exciting and exciting set brand, portfolio

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do interesting. done the Jaybird, an opportunity with bought platform than I think really something a really when market, was different really saw we to we being in that is

term ourselves out of all a excited structurally squeeze it basis from to trying the term there, on back and long about we’re build and really potential juice lemon the growth. So we’re long for super that holding short-term

we So no, more changing the you’ll through on thinking and the and I don’t think distribution so we’re as product done portfolio, ahead. see yet footprint go

a It functionality improve upgrades. of help it’s terms presentation has colleagues the we in to fantastic as Spotlight, present that It’s their product, can software CFO still them through my applications so you improve software So skills. my to know. favorite

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money to every it’s more there we’re that--the you and nice thing growing. think that, but about did I not so go a amount of marketing a more advertise or that’s about best keep in time and places. it the is category, present people, thing so small more will that going for spend you it’s the in and tremendous Yes, one still to something, a very cool out it it presenting, the and advertising, We group just traction getting thing more of it’s think

if Maybe I Okay, a question here. just thank you. can add

to very video the essentially sell, I right, successful with You’re conferencing to companies, those and businesses. product, guess,

has into guess leverage leverage sales your Spotlight to you get the mice but I’m businesses also conferencing to can contacts and in the more you not, video only and other don’t know keyboards, sitting world, super try mice can into I’m of I if the the which categories? company I that the outdated so to of how keyboards? product So more get business business sort world, eventually

Potentially.

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its term the term We there. we’d just excited long and for so into be making much focused mistake if big video collaboration things video using there’s we’re us, business. many to potential to on has growth So mice keyboard to runway It’s offerings itself carry got get stay super and long think a businesses really a and to it, we’re tried it by there right about of collaboration, back. but too put our ahead maybe we going shoulders now

Understood, thank you.

Thanks Michael.

your Once again, if a then press ask number like the would keypad. you to telephone one star question, on

from Guenther from comes question next Your Baader-Helvea. Hollfelder

line Your open. is

impact. currency on Baader-Helvea. the have hi. follow-up I Guenther it’s you, a Hello, Hollfelder, Thank

the on lighter three second in to should at also could profitability how current if expect sales, exchange impact at the rates? the tailwind on half, and we two of PP you terms a Looking Thanks. comment

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online accordingly? had season, in last approach expect year, and you terms share yourselves change your holiday season to sales you this have in U.S. into going then one and significant sales quite have--do Do question on also Okay, you compared a in strategy the the of Europe. the positioned of I in particular holiday and

years, day, like it’s the grown for a with so either In seen China, In to--in grown last against lower U.S. up of be away now. consistently it XX and the than have In about Online to the sales about--I was are XX, categories sales in XX, it’d it’s XX%. I for be year now eight online coming other this across XX think to the U.S. one our Americas, and strongly expect. every XX%. it’s year. too online Europe, categories, up point example, you’d our still between not at bumping or multiple grown or we’ve from MPD up far would a Yes, but the looking those, sales

on we’re so emphasis to more until expect online that’s continue, go-to-market, and continue they more to and forever putting We finally stabilize. going our that

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has No, that every I year for been--you here that, don’t think has and outgrowing will but special as online know, there’s been offline before acceleration, a been and continue. long it as I’ve

Okay, great. Many thanks.

right, thank All you.

question ahead. go from Joern Please comes next from Your Iffert UBS.

Sorry that I am back.

Just up, a on follow if you please, margin. gross profit the

been (indiscernible) Why on mean, quite last some from profit case, would down in two years. with coming benefits Vincent usually the gross I I right case hasn’t margin, gross growing the has margin, indicated QX think, mix the FX top, seems high profit that you versus QX is exactly have now? on As strongly. this already favorable the be the

has just been in case what the Is two should last read it conservative, QX statement it not be this we as the So why the QX, here exactly it? be how down years. in is should or reason a versus to

Europe, DC and you create transition of in there of products, which would in which margins it and the the lower the have of products margin the gross if all cost for the stays that where is FX, those a as of so impact us, Friday QX, introduced. lines, course be beneficial. a same is not holidays think normally the new America QX offset have we There’s have of marginally want, Black a if holiday it in by this Then dynamics, as driver third lot No, of you impact promotions, I is, the to have well. in you have may new effect been here normal that old of promotion

seen-- been has it though Okay,

range going feel where built the overall very XX%. just we our other manage our to all take are and Joern, investors committed and quarter. don’t so wrong, It’s about me within Sorry, into we into we’re overall analysts of to good guidance XX

thank you. right, All

Thank you.

At to the the presenters. this over turn time, will call I

halfway Okay, well year. through the we’re

it Vincent going extremely As couple I’ve of in said about now feel a the guys quarter to you line-up year, so our call, product this to the biggest January. forward and times in talking good into look I

This concludes today’s conference call.

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