VTech Announces 2024/2025 Interim Results
VTech Holdings reported mixed results for H1 FY2025. Group revenue decreased 4.5% to US$1,089.7 million, while profit attributable to shareholders declined 6.6% to US$87.4 million. Despite lower revenue, gross profit margin improved from 28.5% to 31.5%, driven by lower material costs and the Gigaset acquisition. The company maintained its interim dividend at US17.0 cents per share.
Regional performance varied with North America revenue down 7.4% to US$453.1 million, Europe declining 1.4% to US$462.1 million, and Asia Pacific falling 7.1% to US$159.4 million. The integration of Gigaset assets is progressing well and expected to complete by end of 2024.
VTech Holdings ha riportato risultati misti per il primo semestre dell'anno fiscale 2025. I ricavi del gruppo sono diminuiti del 4,5% a 1.089,7 milioni di dollari USA, mentre l'utile attribuibile agli azionisti è calato del 6,6% a 87,4 milioni di dollari USA. Nonostante la diminuzione dei ricavi, il margine di profitto lordo è migliorato dal 28,5% al 31,5%, grazie alla riduzione dei costi delle materie prime e all'acquisizione di Gigaset. L'azienda ha mantenuto il suo dividendo intermedio a 17,0 centesimi USA per azione.
Le performance regionali sono variate, con i ricavi del Nord America in calo del 7,4% a 453,1 milioni di dollari USA, l'Europa in diminuzione dell'1,4% a 462,1 milioni di dollari USA e l'Asia Pacifico in discesa del 7,1% a 159,4 milioni di dollari USA. L'integrazione degli asset Gigaset sta procedendo bene e si prevede di completarla entro la fine del 2024.
VTech Holdings reportó resultados mixtos para el primer semestre del año fiscal 2025. Los ingresos del grupo disminuyeron un 4,5% a 1.089,7 millones de dólares estadounidenses, mientras que la utilidad atribuible a los accionistas cayó un 6,6% a 87,4 millones de dólares estadounidenses. A pesar de los menores ingresos, el margen de beneficio bruto mejoró del 28,5% al 31,5%, impulsado por la reducción de costos de materiales y la adquisición de Gigaset. La compañía mantuvo su dividendo intermedio en 17,0 centavos de dólar estadounidense por acción.
El desempeño regional varió, con ingresos en América del Norte cayendo un 7,4% a 453,1 millones de dólares estadounidenses, Europa disminuyendo un 1,4% a 462,1 millones de dólares estadounidenses, y Asia-Pacífico cayendo un 7,1% a 159,4 millones de dólares estadounidenses. La integración de los activos de Gigaset avanza bien y se espera que se complete a finales de 2024.
VTech Holdings는 2025 회계연도 상반기 혼합 실적을 보고했습니다. 그룹 수익은 10억 8970만 달러로 4.5% 감소했으며, 주주에게 귀속되는 이익은 8740만 달러로 6.6% 하락했습니다. 수익이 낮아졌음에도 불구하고 총 이익률은 28.5%에서 31.5%로 개선되었으며, 이는 원자재 비용 감소와 Gigaset 인수 덕분입니다. 이 회사는 중간 배당금을 주당 17.0센트로 유지했습니다.
지역별 성과는 차이가 있었습니다. 북미 지역 수익은 4.5% 감소하여 4억 5310만 달러, 유럽은 1.4% 감소하여 4억 6210만 달러, 아시아 태평양은 7.1% 감소하여 1억 5940만 달러에 이르렀습니다. Gigaset 자산 통합은 순조롭게 진행되고 있으며 2024년 말까지 완료될 것으로 예상됩니다.
VTech Holdings a annoncé des résultats mitigés pour le premier semestre de l'exercice 2025. Le chiffre d'affaires du groupe a diminué de 4,5% pour atteindre 1.089,7 millions de dollars américains, tandis que le bénéfice attribuable aux actionnaires a chuté de 6,6% pour s'établir à 87,4 millions de dollars américains. En dépit de la baisse des revenus, la marge brute a augmenté de 28,5% à 31,5%, grâce à la réduction des coûts des matières premières et à l'acquisition de Gigaset. L'entreprise a maintenu son dividende intérimaire à 17,0 cents US par action.
La performance régionale a varié : les revenus en Amérique du Nord ont baissé de 7,4% à 453,1 millions de dollars, ceux de l'Europe ont diminué de 1,4% à 462,1 millions de dollars, et ceux de l'Asie-Pacifique ont chuté de 7,1% à 159,4 millions de dollars. L'intégration des actifs de Gigaset progresse bien et devrait être achevée d'ici fin 2024.
VTech Holdings meldete gemischte Ergebnisse für das erste Halbjahr des Geschäftsjahres 2025. Der Gruppenumsatz sank um 4,5% auf 1.089,7 Millionen US-Dollar, während der den Aktionären zurechenbare Gewinn um 6,6% auf 87,4 Millionen US-Dollar zurückging. Trotz des niedrigeren Umsatzes verbesserte sich die Bruttogewinnmarge von 28,5% auf 31,5%, was auf niedrigere Materialkosten und die Übernahme von Gigaset zurückzuführen ist. Das Unternehmen hielt die Zwischendividende bei 17,0 US-Cent pro Aktie.
Die regionale Leistung variierte: Der Umsatz in Nordamerika fiel um 7,4% auf 453,1 Millionen US-Dollar, in Europa um 1,4% auf 462,1 Millionen US-Dollar und im asiatisch-pazifischen Raum um 7,1% auf 159,4 Millionen US-Dollar. Die Integration der Gigaset-Assets verläuft gut und soll bis Ende 2024 abgeschlossen sein.
- Gross profit margin improved significantly from 28.5% to 31.5%
- Maintained stable dividend at US17.0 cents per share
- Successfully integrated Gigaset assets with normalized production by September
- Retained market leadership in electronic learning toys across major markets
- Strong growth in TEL products revenue in Europe (+93.4%) due to Gigaset integration
- Group revenue decreased 4.5% to US$1,089.7 million
- Profit attributable to shareholders declined 6.6% to US$87.4 million
- Higher operating expenses from Gigaset integration
- Revenue declined in all major regions: North America (-7.4%), Europe (-1.4%), Asia Pacific (-7.1%)
- CMS revenue decreased significantly across regions due to weak demand and customer inventory issues
Higher gross profit despite lower revenue
- Group revenue decreased
4.5% toUS $1,089.7 million - Gross profit margin improved from
28.5% to31.5% - Profit attributable to shareholders of the Company declined
6.6% toUS $87.4 million - Interim dividend of US17.0 cents per ordinary share, unchanged
- Gigaset integration on track for full completion by end of calendar year 2024
- Financial position remains strong
VTech Holdings Limited (HKSE: 303) today announced its results for the six months ended 30 September 2024.
"VTech reported lower revenue and profit in the first half of the financial year 2025. A decline in sales of contract manufacturing services offset growth in electronic learning products and telecommunication products. Profit attributable to shareholders of the Company decreased owing to lower Group revenue and higher operating expenses arising from the integration of the assets of GST Communications GmbH (formerly known as Gigaset Communications GmbH), despite an improvement in gross profit," said Mr. Allan Wong, Chairman and Group CEO of VTech Holdings Limited.
Results and Dividend
Group revenue for the six months ended 30 September 2024 decreased by
Profit attributable to shareholders of the Company declined by
Basic earnings per share decreased by
The Board of Directors has declared an interim dividend of US17.0 cents per ordinary share, unchanged from the interim dividend declared in the first half of the financial year 2024.
Costs
The Group's gross profit margin in the first six months of the financial year 2025 was
The increases in direct labour costs and manufacturing overheads as percentages of Group revenue compared with the same period last year were mainly due to an increase in production volume, with an associated increase in the factory workforce, as well as the inclusion of workers at the Gigaset factory in
Integration of Assets of GST Communications GmbH (formerly known as Gigaset Communications GmbH)
On 5 April 2024, VTech completed the acquisition of the assets of GST Communications GmbH, a global leader in communications technology based in Bocholt,
The Group took swift and efficient action to integrate the assets into its global operations during the six months following the acquisition. The supply chain was restored and changes to procurement were instituted to lower costs. By September, production and product supply had returned to normal.
VTech has also been re-establishing the sales force in all major European countries. Communications and interactions have been enhanced to speed up decision-making in the launch of new products.
To unlock synergies in the development of new products and their manufacture, VTech's engineering teams are now working closely with the product development teams in
Segment Results
Group revenue in
ELPs revenue in
In standalone products, VTech saw higher sales of infant, toddler and preschool products, the Kidi line and electronic learning aids. These offset declines for the Go! Go! Smart family of products, Switch & Go® Dinos, Marble Rush® and eco-friendly toys. Meanwhile, sales of KidiZoom® cameras held steady. LeapFrog managed to achieve growth in infant, toddler and preschool products, as well as eco-friendly toys. The Magic Adventures™ series also achieved higher sales, as the successful roll-out of Magic Adventures Binoculars contributed additional revenue. However, these were partially offset by lower sales of LeapLand Adventures™.
Platform products saw sales increase, mainly driven by LeapFrog products. LeapFrog saw higher sales of educational tablets, interactive reading systems and Magic Adventures Globe. However, subscriptions to LeapFrog Academy™ reported a decline. For VTech, sales of platform products held steady during the period. Sales of Touch & Learn Activity Desk™ saw an increase, offsetting declines in KidiZoom Smartwatches and KidiBuzz™.
In September, LeapFrog launched its "Everything Starts with Reading" campaign, designed to inspire children to achieve success in reading. Showcasing a range of the brand's best-selling educational tools, all tailored to different development stages, the campaign features partnerships with a diverse group of influential voices, who talk about how reading helped their lives.
The Group's ELPs received numerous awards in
TEL products revenue in
In residential phones, despite outperforming the market in
Commercial phones sales decreased despite growth in hotel phones and headsets. There were good sales of the latest series of hotel phones, while the new thermostats for the hotel channel made further progress in increasing market penetration. Sales of headsets grew as a customer increased orders. These were, however, insufficient to offset lower sales of SIP (Session Initiation Protocol) phones, as a customer reduced orders. Sales of multi-line analogue phones also posted a decline.
Sales of other telecommunication products also declined. Baby monitors saw sales decrease owing to keen competition. A reduction in orders led to lower sales of CareLine® residential phones while sales of IADs (integrated access devices) remained stable. In the first half of the financial year 2025, the Group retained its position as the number one baby monitor brand in the US and
CMS revenue in
Group revenue in
ELPs revenue in
For standalone products, growth in the LeapFrog brand was offset by a sales decline of VTech products. At LeapFrog, infant and toddler products saw higher sales, offsetting decreases in preschool products and LeapLand Adventures. The successful launch of Magic Adventures Binoculars in key European markets added incremental revenue in the Magic Adventures series. Sales of eco-friendly toys, meanwhile, remained stable. At VTech, infant, toddler and preschool products recorded higher sales. These gains, however, were insufficient to offset lower sales of the Go! Go! Smart family of products, KidiZoom camera, the Kidi line, electronic learning aids, Switch & Go Dinos, Marble Rush and eco-friendly toys.
Platform products saw lower sales of both VTech and LeapFrog products. At VTech, sales of children's educational tablets, KidiZoom Smartwatches, the KidiCom® range of products and Touch & Learn Activity Desk all declined. At LeapFrog, both Magic Adventures Globe and interactive reading systems recorded sales decreases.
During the first six months of the financial year 2025, VTech V-Bot Explorer, Mon robot 5 en 1 (5-in-1 Make-a-Bot) was named "Best Robot" and VTech Genius XL – Jumelles vidéo interactives (Magic Adventures Binoculars) was named "Best Discovery Toy" in the "Grand Prix du Jouet 2024" awards from
Revenue from TEL products in
Despite market decline and lower shipments to ODM (original design manufacturing) customers, sales of residential phones in
Sales of commercial phones also increased as Gigaset sales offset declines in Snom branded SIP phones and hotel phones. Weak economic conditions in
Sales of other telecommunication products decreased, largely attributable to lower sales of CAT-iq handsets and CareLine residential phones, as ODM customers reduced orders because of over-inventory. This offset higher sales of baby monitors as VTech continued to make progress in major European countries. In the
CMS revenue in
Group revenue in
Revenue from ELPs in
TEL products revenue in
CMS revenue in
Other Regions
Group revenue in Other Regions, comprising
ELPs revenue in Other Regions increased by
TEL products revenue in Other Regions grew by
CMS revenue in Other Regions was immaterial in the first six months of the financial year 2025.
Outlook
Despite a fall in inflation, global interest rates remain high and geopolitical tensions are increasing. This is weighing on confidence in all markets, and both businesses and consumers continue to rein in spending. In spite of the challenging economic environment, Group revenue for the full financial year 2025 is forecast to increase, driven by higher ELPs sales in the US and increased revenue from TEL products following the integration of Gigaset. Profitability, meanwhile, is on track to show improvement for the full financial year, as cost of materials continues to trend down and the Group benefits from a change in product mix, with increased sales from its branded businesses.
For ELPs, revenue is forecast to increase for the full financial year 2025. The growth is expected to come mainly from the US, where the new leadership team is deploying a revitalised sales and marketing strategy that is achieving good results. Standalone products will continue to lead the sales increase, with licensed preschool products performing particularly well. In
TEL products revenue is expected to see growth year-on-year, driven by higher sales of residential phones and commercial phones. Sales are expected to improve in the second half, as the production and supply of Gigaset's products have now returned to normal. VTech is on track to complete the integration process by the end of the calendar year 2024. The Group is focusing on growing Gigaset's commercial phones and residential phones. The second half of the financial year 2025 will see the launch of Gigaset's first desktop phones to complement its well-recognised multi-cell systems. It will thus be able to deliver seamless, comprehensive solutions to professional users in office, service and industrial environments. In addition, VTech aims to increase its share of the residential phones market in
CMS revenue is now expected to decrease for the full financial year 2025 due to geopolitical uncertainty and the generally weak global economy. Sales in the second half, however, are forecast to stabilise. VTech CMS is well positioned for the growing demand of companies seeking to diversify their source of supply away from mainland
"VTech has taken steps to maintain competitiveness in the face of the rapidly changing political and economic environment by increasing its global footprint. Our solid balance sheet, reputable brands, strong product innovation and operational excellence underpin our consistent performance. We look forward to the opportunities that lie ahead," said Mr. Wong.
Notes:
[1] Circana, Retail Tracking Service. Ranking based on total retail sales of VTech and LeapFrog products in the combined toy categories of Early Electronic Learning, Toddler Figures/Playsets & Accessories, Preschool Electronic Learning, Electronic Entertainment (excluding Tablets) and Walkers for the calendar year ended September 2024
[2] Circana, LLC, Retail Tracking Service, US & CA, Tech, Baby Monitors, Dollar and Unit Sales, April 2024 – September 2024 Combined vs. April 2023 – September 2023 Combined
[3] Music Trades Magazine, September 2024 Edition, Based on estimated revenue for the calendar year 2023
[4] Circana, Retail Tracking Service, January – September 2024
[5] GfK Retail and Technology
[6] Circana, Retail Tracking Service. Ranking based on total retail sales of VTech and LeapFrog products in the combined toy categories of Early Electronic Learning, Toddler Figures/Playsets & Accessories, Preschool Electronic Learning, Electronic Entertainment (excluding Tablets) and Walkers for the calendar year ended September 2024
About VTech
VTech is the global leader in electronic learning products from infancy through toddler and preschool and the world's largest supplier of residential phones. It also provides highly sought-after contract manufacturing services. Its culture of integrity, accountability and innovation guides the company towards a sustainable future.
Established in 1976, VTech has been the pioneer in the electronic learning toy category and its products incorporate advanced educational expertise and cutting-edge innovation. The Group's telecommunication products elevate home and business users' experience through the latest in technology and design. As a leading electronic manufacturing service provider, VTech offers full turnkey services in facilities that are moving towards Industry 4.0 manufacturing.
With a global workforce of over 20,000 employees in 15 countries and regions, VTech maintains R&D centres, manufacturing operations and sales subsidiaries across the
Shares of VTech Holdings Limited are listed on The Stock Exchange of Hong Kong Limited (HKSE: 303).
Note: Starting from 22:00, 12 November (HKT), the webcast of the results announcement can be accessed through VTech website via this link https://www.vtech.com/en/investors/results-reports/.
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SOURCE VTech
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