Logitech’s Gaming segment has been one of the company’s stronger growth segments. In the first quarter of fiscal 2027, Gaming revenue increased 12% YoY to $354.2 million, making it one of the company’s faster-growing categories. However, Logitech International S.A. (NASDAQ:LOGI) still needs to sustain that momentum and convert it into continued growth. Its latest partnership with SEGA around Crazy Taxi could strengthen Logitech’s gaming ecosystem, but near-term supply constraints remain a bigger issue for investors.
Logitech’s AI push could turn more than 100 million compatible devices into a broader platform — but a major supply bottleneck could get in the way. See what could derail LOGI’s momentum.
Logitech’s Racing Hardware Gets a New Gaming Showcase
Logitech G has become the official steering wheel partner for SEGA’s upcoming Crazy Taxi: World Tour, scheduled to launch in 2027. The partnership will support several Logitech G racing wheels, including the G29, G920, G923, RS50, and PRO Racing Wheel, with TRUEFORCE haptic feedback technology available on select models. Moreover, SEGA has joined Logitech G’s Developer Alliance. This will allow companies to work more closely on hardware integration. This shows that the partnership is more than a branding opportunity, as Logitech can integrate its racing hardware directly into the gaming experience. But there is one risk that the company itself is pointing out that could dampen investor sentiment.
Supply Constraints Could Limit the Near-Term Benefit
The partnership looks attractive on paper as it could strengthen the company’s gaming ecosystem, but the company faces a more immediate challenge in meeting existing demand. Logitech warned in July that an incident at a semiconductor supplier’s manufacturing facility could reduce sales by approximately $20 million in Q2 and up to $200 million in Q3. Investors’ concerns regarding supply constraints are understandable, as disruption is heading into the important holiday shopping period. During the company’s earnings call, CEO Hanneke Faber remarked,
The general supply situation for semiconductors is unusually tight across the industry at the moment, and getting significantly more supply ahead of the holidays is particularly challenging.
On a more bearish note, a Morgan Stanley analyst assigned a Sell rating to the stock on September 18. Although the partnership reinforces Logitech’s long-term gaming strategy, investors will need to see whether it eventually translates into meaningful demand for its racing hardware.
Logitech’s Valuation Is Held Back by Flat Earnings
Logitech’s valuation looks mixed. The forward GAAP P/E of 20.83x sits about 11% below its 5-year average, while the forward Price-to-sales ratio of 2.95x sits roughly 10% above. The EPS outlook isn’t anything exceptional. Analysts expect earnings to stay nearly flat this fiscal year, likely weighed down by the chip shortage. Growth then picks up slightly, going to 6% to 9% in the next 3 years. The balance sheet is a strength, though. Logitech holds $1.75 billion in cash against $84.39 million in debt. That gives it room to absorb a weaker holiday quarter. For now, supply matters more to the stock than any single partnership.
The number of hedge funds holding the stock dropped from 26 at the end of the first quarter of 2026 to 22 at the start of Q2 2026. The reduction was relatively small, but it came from an already small group of institutional holders. At the same time, short interest remained elevated at 9.26% as of August 31, 2026.
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