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Logitech Selling Harmony Division After ‘Unacceptable’ Q3 Results

Logitech CEO Bracken Darrell calls Q3 financial results "unacceptable," saying the company will discontinue "non-strategic products" by the end of 2013.


Logitech Harmony Touch

Logitech launched in Oct. 2012 the Harmony Touch remote that communicates via IR and controls up to 15 components.

Logitech, which acquired startup remote company Harmony several years ago, announced it wants to sell off that business along with its surveillance camera business.

Logitech posted its financial results for Q3 of its 2013 fiscal year, calling the results “unacceptable.” The company made an operating loss of $180 million off sales of $615 million. Retail sales were down 14 percent year on year, and CEO Bracken Darrell plans to discontinue “non-strategic products” by the end of 2013.

“These results are unacceptable and we are taking decisive action as an outcome of my strategic review,” says Darrell. “I was pleased with the continued strong demand for our Ultrathin Keyboard Cover in Q3. We plan to expand our presence in the growing tablet accessories category with the launch of a number of exciting new products later this quarter.

“We are taking immediate actions to shape a faster and more profitable Logitech. We are developing more mobility-related products, leveraging the powerful growth of tablets and smartphones. We intend to sustain our leadership in PC platform-related products where we have engineering, distribution and scale advantages. Our goal with PC-platform products is to maximize profitability, while investing selectively in growing categories. We have also identified a number of product categories that no longer fit with our current strategic direction. As a result, we have initiated the process to divest our remote controls and digital video security categories, and we plan to discontinue other non-strategic products, such as speaker docks and console gaming peripherals, by the end of Calendar Year 2013.

“As we execute our plans over the coming quarters, we will reduce costs significantly across the company beyond the $80M annual cost savings (FY 2014 over FY 2012) resulting from the restructuring we announced last April. My goal is to get Logitech back to sustained profitability as quickly as possible. This requires unwavering focus on developing great products both for large and for fast-growing markets, removing unnecessary costs and a commitment to move at least as fast as the markets in which we participate.”

Logitech launched in Oct. 2012 its first new Harmony remote in two years, the Harmony Touch. At a time when every new product has its own control app, and app-based remotes (including Harmony’s own remote app) have become popular and inexpensive, the challenge of selling high-end remotes apparently has gotten too difficult to sustain.

We hope and assume the company will continue to support products currently on the market. Harmony’s database of control codes surely has value to some prospective buyers, so I don’t expect this will be the end of Harmony remotes.

Possibly one problem Harmony had is that it’s stuck to an old model of IR control. So many of today’s devices now incorporate IP connection, and homeowners increasingly want to have their entertainment system integrated with other systems in the house, such as lighting. That’s a task largely beyond the capability of a remote such as Harmony makes, but is obviously possible with the more reliable control systems offered by companies like Control4, Crestron, Savant, URC, Elan and RTI.





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Article Topics

News · Product News · Home Automation and Control · Control Systems · Logitech · All topics

About the Author

Grant Clauser
Grant Clauser is the technology and web editor for Electronic House. Grant has been covering home electronics for more than 10 years with editorial roles in several consumer and trade magazines. He's done ISF-level damage to hundreds of reviewed products and has had audio training from Home Acoustics Alliance and Sencore.

10 Comments (displayed in order by date/time)

Posted by Chadb  on  01/25  at  12:33 PM

Perhaps the problem was that the product was poorly made and once they took it out of the CI’s channel - nobody sold it anymore. There are plenty of basic IR demands available, however URC and RTI stepped up and squashed them in terms of quality and support. Good Riddance!

Posted by jbrown  on  01/25  at  01:13 PM

These remotes worked great until Logitech got a hold of them. Hopefully someone who knows how to build a remote will snap up the brand and start making quality products again.

Posted by izackary  on  01/25  at  04:10 PM

They already ruined and killed off the Squeezebox brand. Next will be Ultimate Ears, once a revered brand name, just watch. No more Logitech for me, period.

Posted by lbaltz  on  01/25  at  04:31 PM

Logitech also ruined Squeezebox….

Posted by d Bendell  on  01/25  at  07:15 PM

To Bracken Darrell,
What did you expect, Harmony has not invested in the custom channel in years! When was the last time Harmony showed up at Cedia? When was the last time you had an effective custom retail distributer, promoting and selling to the custom guys? No, Logitech, just whored themselves out to the Amazons of the world hoping to produce volume but never got any feedback about how to maintain an edge.  You let guys like URC, RTI, come in and take all your market share because they could make a profit on the products they sell.  See, it just goes to say that Amazon, Best Buy produce volume, but that to sustain and profit from a product, you need the custom channel and independants for the “Bread and Butter”.  So long to a great product, So long to all those manufactures who are learning the hard way that big boxes, Amazons of the world do not sustain growth! When you ALLOW these types of selling margins to disappear, dealers migrate to others who sustain profitability into their products and grow the marketshare even if it means selling a subpar product in the meantime!

Posted by David  on  01/25  at  08:58 PM

I have used these remotes for several years & love them.  I can’t afford other “universal” remotes, or they didn’t control all of my devices.  I will now probably buy spare remotes, since, as long as my equipment doesn’t change I can stil load my existing program.

Posted by Mark Nagle  on  01/27  at  09:47 PM

“the challenge of selling high-end remotes apparently has gotten too difficult to sustain”

Harmony was the opposite of a “high end remote” I never even sold them and they caused me more headaches that I care to talk about.

Posted by Matt Eagar  on  01/28  at  07:56 AM

I’m not sure they will find a buyer. Philips failed to find one for Pronto, and I’m not sure Logitech has a much better shot.

Posted by Phil  on  01/30  at  08:38 AM

Good riddance.

Posted by Kyle Peterson  on  02/26  at  07:45 AM

Yea!

Logitech drove Harmony in to the ground.

I have over 200 accounts with Harmony and CAN’T WAIT now until Logitech has the reins yanked from their incapable hands.

Good riddance to Logitech.  Maybe I’ll keep using their keyboards, but this one I’m using now has not held up well.

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