The global pandemic currently sweeping the rest of the world is starting to change the way we work and play in potentially permanent ways. I believe that the companies that have the best chance of success in a post-COVID world are those that would enable the "new normal". In a scenario of extended social distancing, Logitech International (NASDAQ:LOGI) seems poised to do well.
E-sports could be the only sports for a while
Just a bit of background on the company, Logitech is a manufacturer and designer of various peripherals for the PC, mobile, and consoles market. Their products include various headsets, keyboards mouse, and other peripherals which are predominantly used by gamers, video-streamers, and other high-usage PC users.
According to the company's latest SEC filings, gaming has consisted of roughly 24% of the company's total sales. In the 9 months ending Dec. 2019, gaming had sales of $541 million against total sales of $2.2 billion. Historically, the company's sales have been boosted by the popularity of the e-sports scene. Gamers influenced by the celebrities of e-sports would buy Logitech's high-end peripherals to enhance their gaming experience. It really is no different than Nike (NKE) using famous NBA athletes to promote their shoes.
The e-sports scene was already rapidly growing in 2019, reaching an audience of 443 million across the globe. E-sports games have sold out at arenas and have been featured in sports channels like ESPN. The global pandemic will only accelerate this trend even further.
Currently, it is impossible to hold any sort of sporting events while adhering to social distancing guidelines. Major leagues such as the NBA have pushed their seasons back a year. Even "closed-door" events risk the athlete's health just by the physical nature of sports competition. This limitation, however, would not apply to something like e-sports which
