Increasing costs and a rise in sales and marketing expenditure dented Q2 profitability at mouse and keyboard specialist Logitech but the vendor still expects to meet its annual sales target of around $2.4bn and gross margins of 33%.
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Although sales increased 1% to $589m compared to the same period in 2010, net income fell 58% to $17m for the three months ended 30 September on a 7% rise in the
cost of goods sold
and a 10% surge in sales and marketing costs. R&D costs declined slightly.
There was a 17% decrease in OEM sales but the vendor's biggest sales outlet, the retail channel, rose slightly.
Logitech chairman and acting president and chief executive officer, Guerrino De Luca, described the results as being "consistent with our expectations". He said the company expected improved performance in the second half of its fiscal year 2012 "as we focus on reinvigorating our product offerings and executing in sales and marketing".