My name is Oliver Wong. I'm part of the European IT hardware team. It's my pleasure and honor to welcome Matteo here, CFO of Logitech. Logitech is a, I'm sure as everyone knows, it's a global manufacturer of peripherals related to gaming, keyboards, and combos, pointing devices, video collaboration, webcam, et cetera. The products are ubiquitous in offices and homes around the world. Logitech is listed in Switzerland and on the NASDAQ. It has around 7,000 employees and is headquartered in Lausanne, Switzerland. Why don't we get started? Matteo, what is the state of the union of the peripherals market and of your key demand drivers right now? Oliver, first of all, thanks for having us today. It's great to be here. Let me start at a high level. If you look at some of the numbers that we printed in our last quarter, overall, I'm relatively optimistic, I would say. When you look at, let me start with B2B and B2C, at a high level, the company is about 60% B2C and 40% B2B. On the consumer side, I would say the consumer is pretty resilient all across the regions, even in the United States. Actually, consumer in the last quarter grew faster than the B2B. I'm going to talk about that in a second. We are seeing different types of behaviors. You have consumers that go out and spend, and who cares? Other consumers are a little bit tightening the belt with the uncertainties. Overall, if you look at our area, particularly gaming, gaming is going really gangbusters. We had almost double-digit growth in demand last year. We gained several points of shares in the United States. I think overall, on the consumer side, things, I would say, at least in the last quarter, were very healthy. On the B2B side, I would say, for us, we saw maybe a little bit more choppiness in the last quarter, primarily coming out of Europe. We are starting to see companies with the uncertainties of tariffs and what is going on in the world, geopolitical, hold some of the cash and hold some of the money, which, quite frankly, is also how we are, I think. That is not surprising. Europe was down a little bit in B2B last quarter. Overall, as I said, I think as we companies are cutting travels, cutting, asking people to curtail some of their cost, if you do not travel, you need video conferencing equipment if you want to operate. That should be a sweet spot for us. That is where we have great products. Overall, I think we are pretty optimistic in the way things are playing out. Got it. You mentioned the T word. Here comes the question. How are tariffs affecting Logitech's business? As a CFO, how do you deal with it, especially given how the rates and the start dates seem to be constantly shifting around? I would define it challenging, but manageable, even for the CFO. I think just to take a step back for those here in the room that do not know us, it is great to be a global company today because only basically 30% of our sales are in the United States. All the rest is not impacted by tariffs. Of what we import into the United States today, about 40% comes from China. This is a number that progressively came down. Actually, back in 2018, we were 100% in China. The team has done really a marvelous job in diversifying progressively the supply chain and making the supply chain more resilient. We are starting from, I would say, an advantaged position, all things being considered. The other point is, look, we have a great brand. This allows us to have more pricing power. We can talk a little bit more about that later in terms of the actions that we are taking. Fundamentally, we have a pristine balance sheet that really allows us to play offense. We see this in a way, even though the environment is challenging, as an opportunity to play offense and gain share. That is at the macro level. It is very complicated because we have products that come from several countries, including China. You have some categories of products that are tariff-exempted, others that are not. Right now, we have products that have 0% tariffs, some have 10%, 20%, up to 30% if they come from China and they are not tariff-exempted. It is a complicated equation to keep track of it. Overall, what we said in the last earnings call, for us, the impact of tariffs in the first quarter is about 200 basis points on the margin. This is gross, so not including any positive impact of pricing that we have been taking. The number is a little lower because we proactively leveraged the strong balance sheet that we have. We pulled in some of the inventory before the end of fiscal year 2025, before the tariffs actually were enacted. If you adjust for that, the impact would have been about 300 basis points with the new tariff change that happened with China in the last two weeks, two weeks and a half. To counter that, we took several steps. Number one, we announced and communicated to our customers in the US a price increase around mid-April. It is about, on average, a 10% price increase in the U.S. This will allow us in the quarter to mitigate basically roughly half of the impact of the tariffs that I just mentioned. We continue to work on what we can control. The company has done historically a great job in driving product cost reduction through value engineering, taking cost out of the bill of material that really accounted for the biggest margin expansion that we had last year. That will continue. The team continues to be focused on that. It is really the right time to focus on product cost reduction. We took austerity measures on the cost side, particularly on G&A. We halted travel, asked the team to curtail that, halted hirings. The hirings are in R&D and sales. We tried to limit the hirings across the company. We really looked at all the typical blocking and tackling actions that every company does in the REITs, contractors, and all this kind of cost. We continue to accelerate the diversification of our supply chain out of China. What we will not do is cut R&D because that's really the engine of the company. That's how we are approaching it. It is for sure complicated, but as I said, it's complicated, but so far, I would say manageable. Got it. As you mentioned, as of last quarter, for your U.S. sales, around 40% were from China. The plan, which is quite ambitious, is to cut that down to 10% by the end of next fiscal year, end of this fiscal year. Can you tell us a bit more about how you're able to rebalance your manufacturing footprint so quickly? Maybe also, what's the possibility of potentially manufacturing here in the U.S.? Let me answer first the first part of your question. We can do this quickly because we started to do this much, much earlier, as I mentioned a few minutes ago. This is really the credit that goes to Sree, his team, so our supply chain teams, and also, quite frankly, the prior administration, our predecessors. For us, tariff was not a knee-jerk reaction that now all of a sudden we have to rush it and move out of China. This was already ongoing. In a way, this put us a little bit ahead of the pack. The reason why we can do this fast is because fundamentally, we, for the most part, are moving some of the production to partners that are already working with us. This is not us starting from zero and going looking for new people. These are partners that already know us. They know our products. They're already manufacturing the vast majority of our products. It's just a matter of having more capacity and moving capacity from one place to the other one. That's fundamentally the reason why we can do this fast. Quite frankly, the team is a great team. They went through a lot through COVID, and they have a lot of experience in managing tough times like we are managing today. To the second part of your question, today we have no production in the U.S. I would say never say never. Generally, when we look at a specific country, a specific place, there are a couple of things that we always look at, obviously the cost, the availability of labor, and then the entire supplier ecosystem around the product that we need. This is the modus operandi that we use. That's how we determine where to go. This approach is what worked very well for us in the last few years, and we'll continue to do that. We'll see how things play out. Got it. Moving on from tariffs, how is Logitech thinking about its long-term growth drivers, especially in a post-pandemic normalized environment? We had Investor Day back in March. We outlined a target of 7%-10% annual growth for the company. This 7%-10% has different components. Let me just break it down for you. 5%-6% of the growth will come from the market growth and share gains. We are playing in three key areas: personal workspace, gaming, and the enterprise side, B2B. Data shows these are markets that are poised to grow mid to high single digit. That provides a natural tailwind for the company. We are planning to gain a point of share every year. We do that through, number one, the continuous focus on R&D, so new product development, new product launches, continue to gain our brand and make the brand more and more iconic through customer centricity, as well as the continued focus on innovation. Then the continued work on increasing the share of wallet in the geographies where we play in. That is how 5%-6% of the growth will come. If you look at what the company did pre-COVID, before my time, the company grew exactly in the middle, around 5%-6%. It is not something that the company has not done in the past. It is something natural for the company. That is the portion. The second aspect is, as you know, we are in B2B. We identified a couple of verticals, primarily education, healthcare, and the public sector, where today we are not, the company historically has not focused a lot. They represent really great opportunity for us. We have products that already have proven relevance in this area. These are high, large, growing markets where we really have almost an opportunity and the right to play with the products that we already have. We have to make some investments on the R&D, a little bit on the Salesforce, a little bit on the tools, because if you look at the history of the company, the company is primarily a consumer company. Overall, these are great spaces. We are expecting to enter in this market and grow 1%-2% in yield, just entering this market with yield about 1%-2% of growth. The rest is M&A. We outlined very strict boundaries on what we look at. We are very comfortable with the organic growth trajectory of the company. We do not need large transformational deals. Really, we are looking more at tuck-ins, bolt-ons that can expand our product portfolio, make it better, still in the areas of work and play. That is how you dissect the 7%-10%. 5%-6% comes from market growth and share gains, 1%-2% from the adjacencies. The rest is inorganic. Got it. Got it. Very clear. You mentioned the importance of R&D and innovation. It's almost, I would say that that's kind of Logitech's moat within this sort of industry that can be quite commoditized. Could you talk a bit more about the innovation strategy and maybe how do you balance the R&D between hardware, software, services? Sure. The R&D is the engine of the company. As I said earlier, if there is one thing that we will not cut, it is R&D. You should expect that we will continue to spend 6%-7% of our net sales in R&D, even if during the crazy times they will be. I think we look at it this way. First of all, hardware. When we look at hardware, the team is super laser-focused on adding and changing some of the hardware of our products to make fundamentally our life better. Maybe it is to make it a little bit more ergonomic or add a button to the mouse for finance people like us. They They like to be productive. We can move from one application to the other one in a seamless way. That is what we do. That is the hardware piece. Software is probably even the most critical item. As you know, we like to say that our products are software-enabled hardware. As you look at AI, this is a fantastic opportunity for us to make our products, through adoption of AI and through software integration with the hardware, much easier to use and simpler. We have some great examples. We launched Sight, which is this AI-driven almost producer that you have in the room in combination with the Rally Bar, where if you look at the traditional way of having video conference, you have one camera on one side of the room, and the people are sitting on the other side of the table. They are minuscule. If you're at home, you cannot even see them. With Sight, you almost have a producer inside the room that is able to distinguish who's talking, distinguish the noise of a cup of coffee from the voice of the person, and really zooms in the camera to the people that are actually involved in the conversation. If you are at home, it makes you much more feel you are part of the conversation versus the traditional way of video conference. That is all AI-enabled, AI-featured. Software is super critical. The third piece is the investment for the future. The opportunity for us to grow in the spaces where we play in is immense because we are a $4.5 billion company in a $24 billion market. We cannot forget about what the future will present. About 15%-20% of our R&D budget is focused on looking at what could be the product of the future. That is where we partner with big players like Adobe, with Meta. We launched a couple of new great products last year, the Creative Console that is done in partnership with Adobe that makes the work of the creators much, much easier. Probably the one that you guys probably know is the MX Ink, which is the pen that works in combination with the Meta VR headset, where if you are a designer, you can draw instead of using the mouse on a table. These are more innovation for the future. That is the third piece of our R&D approach. You mentioned service. Very important for us on the B2B. We are very small. Selfishly speaking, it is a great business. We grew exponentially, like more than double digits last year. It's a fantastic margin. That's a big focus for Prakash and the B2B team to expand our service offering and attach rate on the B2B side. That's where we really help our B2B customers to make the best use of our products in their conference rooms. Got it. Sounds like a very balanced R&D strategy. Going back to B2B, since it is, like you said, an important growth driver for the future of the business, I'm curious about your specific strategy there, including maybe the penetration of the enterprise sales channel. Could you talk a bit more about that? You almost need to look at for B2B for us, you have to dissect it into two groups. You have the enterprise channel, which is about $10 billion market, which we are one of the top players. The team has done a marvelous job. The volume in that area for us more than doubled since pre-COVID. We have been really a disruptor in the market with our features. You still have about only 25% of the conference room worldwide are video enabled. Big opportunity to continue to penetrate that. We have the new verticals that I just talked about, which is another $5 billion market, again, broken down by healthcare, education, and the public sector, where here we need to focus a little bit on increasing the sales force, increasing boots on the ground, and some of the tools, because, as I said, the company fundamentally historically has been a consumer company. You sell B2B in a different way than consumer. Overall, the amount of spend that we'll have to do to make our product adaptable to these new verticals is pretty small. Actually, education is one of the three where we are already in, particularly in the K-12. Education grew 20% last year. That is really, to us, an untapped opportunity that we can continue to leverage. We go to market in two ways, through distributor and through our own sales force. Cool. I guess I'll move on to some more financials-related questions. What is the current channel inventory health? How are you managing sell-in versus sell-through? We're very pleased with how we ended the fiscal year 2025, which for us is the March ending year. In terms of where the channel inventory is, we are in a very healthy position. The team has done a fantastic job last year in adapting the size of the channel inventory to sustain the growth of the company. What this created is a little bit of a dynamic whereby in the first half of fiscal year 2025, we saw the sell-in outpacing the sell-through. This reversed itself in the second half. Today, we're in a very healthy position. I think what you will see in fiscal year 2026, bearing any craziness around the environment, is a much more close relationship between sell-in and sell-through throughout the different quarters. This is thanks to the work that was done by the team in making sure that we enter the new fiscal year with a very healthy channel inventory. That is what we are expecting. Got it. And how should we think about your CapEx and margin trajectory over the next few years? Margin, we said at Investor Day, we plan to grow 7%-10% and have gross margin rate above 40%. That is because thanks to the work that the team has done in the prior years, structurally, in a normal environment, there is no reason why the company should be below 40% in gross margin rate. OI between 15%-18%. We increase by about 100 basis points our target compared to what we had in the Investor Day prior a few years back. CapEx is relatively small. We are a very asset-light type of franchise, which is being the finance guy. That is why I like it. We will see probably a slight increase this year compared to prior years, just because we have to implement some capacity back to the diversification of the supply chain that we talked earlier. Still, we are talking between $70 million to max $90 million of CapEx a year. So pretty small considering the size of the company. It is a very, very asset-light, dynamic, and agile franchise. Got it. What is your capital allocation framework today between buybacks, dividends, and reinvestment in the business? It's pretty unchanged. We've been doing this for quite some time. First priority for us is invest in the organic growth of the company. Our return on investment capital is greater than 25%. That's money very well spent. We will continue to increase the dividends. We have been doing that for quite some time. M&A, as I mentioned earlier. Just tuck-in, bolt-ons, and can continue to expand our product reach in the areas of work and play. Then share repurchase. If you look at what happened in the last several years, the last three years, 30% of the cash that we generated was reinvested in the organic growth of the business. The rest was returned to shareholders in the form of share repurchases and dividends. Very, I would say, investor-friendly capital allocation strategy, but at the same time, very prudent. We closed the fiscal year with $1.5 billion of cash. On M&A, obviously, I know you're not going to talk about anything specific, but maybe a sense of any particular areas where there may be something that's more kind of accretive to M&A or maybe in the past. Again, it is a work and play. The targets for us have to be highly synergistic. They have to be companies that can benefit quickly from our go-to-market for our operational excellence. That is pretty much the strategy. I would say, interestingly, since the tellers were announced, I used to say the amount of inbound that Nate and I received are increasing. That is part of the beauty of closing the fiscal year of last year with $1.5 billion of cash that you can deploy opportunistically. More to come. We will be extremely diligent. Both Hanneke and I are very well aware. It is much easier to buy than to integrate. We are not going to go crazy. Got it. Do we want to see if anyone has any questions in the audience? OK. Let's pivot back to AI, just because it's such a I know it's not sort of directly driving Logitech. You mentioned some of the things that AI is powering, such as the feature where it zooms into people. In your words, what are the biggest ways that AI is impacting Logitech's business? First of all, in the product. Yeah, back to the software comment that I made earlier. I'll just give you a couple of examples. Starting from work, I talked about Sight. We have our new product we just launched a couple of months ago, the Rally Bar 65. This is a beautiful mobile video conferencing tool, equipment. They have a big screen with a rally bar at the bottom. As it creates through AI a cocoon. You can put this one in a conference room. You can put it in the middle of an open space. Through AI, the system detects who's part of the conversation, who's not. If you're put in the middle of this conference room and you're running by, you're not part of the conversation. People at home don't even see you, nor hear you. It's been very successful. That's another great example of AI use. We partner with several companies. We launched in gaming an AI assistant that helps gamers to stream their content. If you're gaming, you don't need to be distracted in streaming. The AI agent does that for you. It comes in different voices. It gives updates on how you're doing. That's pretty cool. This is just a couple of examples on the product. Honestly, we are using also internally. We created our own internal version of ChatGPT so people can upload documents in a safer manner. We are starting just scratching the surface of the real productivity opportunity. We have a lot of usage of AI also in the functions across the company. We monitor that. Per person, it's about, on average, about 10 interactions per day with the AI tool that we are seeing. It's a great, great opportunity. That's a big tailwind for the company. Do you guys take a view on maybe how AI could potentially affect the macro of your end markets in the sense of something like the work from home trend? The pandemic obviously affected kind of people working at home and things. AI is such a big trend. Do you take any? I think AI will make the products better than what they used to be. That is the way we are seeing it. It is really a huge opportunity. That is why we continue to invest in R&D. This will remain our competitive advantage. Got it. And then my last question to you is, what is your personal favorite Logitech product? Can I give you a couple? Or Or do I have too long? Yeah, yeah. I've passed in automotive. I like Formula 1. I really like the simulator. That's fantastic. It's a great product. You guys should try it. It's really, really real. Like real. Like after Like after two laps, I'm not a big gym guy. And my hands are sore. It's a fantastic product. On the work side, the Rally Bar 65, the one I just mentioned, I think is going to be a game changer. It's a great product. It can be used in conference rooms, in offices. It's really, really great. These are my top ones. My team is not going to be very happy. I didn't cover PWS, but it's okay. Maybe next time. All right, perfect. Thank you so much for your time, Matteo.