Logitech CEO Says AI Devices Are Solutions Looking for Problems

(Bloomberg) — Logitech International SA’s chief executive officer said the computer accessory maker is done for now with price hikes, while dismissing other hardware makers’ rush to build artificial intelligence-centric gadgets.

The Swiss company was among the earliest to raise prices earlier this year following a wave of US tariffs. “I think we were quick to do it,” said CEO Hanneke Faber in an interview. “I’m glad we were quick because it had to be done and it was better to rip off the proverbial Band-Aid than kind of drag our feet, which some others did.”

For now, there are no plans for further increases. “The fact that we now have a resilient supply chain with China plus five other countries has really helped us,” she added.

This week marks two years since Faber became CEO. She took on the role as the brand, known for its keyboards and other computer peripherals, was struggling with a plunge in demand as the Covid-19 pandemic ended and more workers returned to the office. The outlook is rosier now: Revenue has been up six of the last seven quarters. In its most recent earnings report, the company posted sales that were in line with analysts’ estimates, while net income and adjusted earnings per share were beats.

“There’s really not a single one of the 13 categories that we play in that isn’t almost back to its Covid size,” Faber said.

For now, the company is holding off on dabbling in AI-specific hardware, the sort of emerging gadgets that allow users to interact with an AI assistant without the need to rely on a smartphone or other screen. OpenAI earlier this year bought a hardware startup co-founded by Apple Inc. veteran Jony Ive. Not much is known about what the combined company is working on, but OpenAI Chief Executive Officer Sam Altman said late last month that it’s in the prototype stage and plans to release something within two years.

Past efforts from smaller upstarts, such as the Humane AI Pin and Rabbit R1, were met with poor sales and scathing reactions from tech reviewers.

“What’s out there is a solution looking for a problem that doesn’t exist,” Faber said.

The company is a strong proponent of AI, she added, and has integrated it across many products. That has included video cameras that can intelligently frame whoever is speaking, and the recently launched MX Master 4 mouse, which offers shortcuts to ChatGPT or Microsoft Copilot through a side button.

When asked how she’s changed the company’s approach to product development, Faber said she has pushed for greater discipline during the innovation process. Logitech ships between 35 to 40 new products annually, and it generally adheres to a product road map that looks three years ahead.

“We’re continuing to spend at about 6% of sales in R&D, which is very high in our industry,” Faber added.

China, Logitech’s second biggest market behind the US, also remains top of mind. “If you can’t compete in China in our business, you’re doomed,” Faber said. Two years ago, the company was losing share “hand over fist,” she said. Faber installed a local team to develop products tailored to the tastes of consumers in that market. Faber said that the business in that region has been growing “20%-plus” for the last three quarters, and that its decline in market share has “definitely stopped.”

Not all of the company’s ideas during her tenure have been winners. Last year, Faber prompted controversy when, in an interview with The Verge, she discussed the idea of a “forever mouse” that would continually gain new features — possibly through a subscription model — and keep functioning long into the future.

Tech enthusiasts, many already dealing with subscription fatigue, seized on the comments as another example of a company trying to squeeze customers for the benefit of shareholders. Thousands of Reddit users decried the idea, and the ridicule grew so loud that Logitech eventually had to respond. The company described the idea as “provocative internal thinking on future possibilities for more sustainable consumer electronics,” but said there were no actual plans for a so-called forever mouse.

“It was never about subscription,” Faber told Bloomberg. Logitech wants all of its hardware to be more eco-friendly, she said. “Throwing things away all the time is just not a great thing for the planet. So this is about durability.”

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