We're making these statements based on our views only as of today. Our actual results could differ materially, and we undertake no obligation to update or revise any of these statements. We will also discuss non-GAAP financial results, and you can find a reconciliation between GAAP and non-GAAP results and information about our use of non-GAAP measures and factors that could impact our financial results and forward-looking statements in our press release and in our filings with the SEC. These materials as well as the shareholder letter and a webcast of this call are all available at our Investor Relations page of our website. We encourage you to review these materials carefully. Unless noted otherwise, references to net sales growth are in constant currency and comparisons between periods are year-over-year. This call is being recorded and will be available for a replay on our website. With that, I will now turn the call over to Hanneke. Hanneke?

Thanks, Nate, and welcome, everyone, to the call. Fiscal year 2025 was a year of outstanding results for Logitech. We delivered strong profitable growth driven by progress against our strategic priorities. Specifically for the year, we delivered 7% constant currency net sales growth. That growth was broad-based across geographies, product categories and customers. We expanded market share in key product categories and remain the number 1 or number 2 player in 11 of the 13 categories that we compete in. We also expanded non-GAAP gross margins by 170 basis points. And non-GAAP operating margins by 70 basis points, growing our operating income to $775 million, and we continue to generate a very healthy amount of cash. We generated about $840 million of cash from operations in fiscal '25, more than 1x operating income. We returned approximately $800 million to shareholders in the form of dividends and share repurchases. Now our success in fiscal '25 can be attributed to four strategic drivers. First, superior products and innovation. Innovation is at the heart of Logitech's strategy and integral to our DNA. In fiscal '25, we launched 39 new products. Globally, bestsellers included the Combo Touch keyboard case for the new iPad, the Pro X Superlight wireless gaming mouse, and the A50 gaming headset family. In China, the new Alto Keys mechanical customizable keyboard became the country's best selling personal workspace mechanical keyboard. These launches and the many design awards that we received for innovation illustrate our ability to deliver design led, software enabled hardware innovation that delights users around the world. Second, we doubled down on B2B. Logitech for Business played an important role in Logitech's success this year. We saw healthy end customer demand growth of about 7% in dollars. Investments in smarter products and go-to-market capabilities fueled growth across video collaboration, headsets and personal workspace products sold to enterprise customers. We're also seeing great expansion in our education vertical with double-digit year-over-year demand growth, and we're seeing double-digit growth in Services revenue. Third, excellent execution across our geographies. We rapidly reapplied best practices and proven strategies from market to market to strengthen our global performance across the board. And finally, operational excellence. Our foundational strength as an operations powerhouse delivered record product cost reductions, driving the second highest annual non-GAAP gross margins in the last decade. Our fourth quarter reflected all of these same strategic factors as well as disciplined execution by our teams. I want to extend my appreciation to all of our employees for delivering an excellent fiscal year 2025. Now as we enter fiscal ‘26, we are faced with a wide range of potential outcomes when it comes to tariffs, consumer and customer confidence, and geopolitics. While acknowledging that uncertainty, we are confident heading into our fiscal year. Logitech was built to compete in good times and through uncertainty. That's because of a number of unique strengths that we built over the years. We have a balanced global customer base. We generate about two-thirds of our global sales outside the United States, which positions us well to manage market specific risks. We invested in a broad, diversified manufacturing footprint across six countries. Today, only about 40% of our products sold in the United States originate from China, with the rest coming from five other countries. We have more room for diversification, and we're able to rapidly shift production to optimize cost and mitigate tariff impacts. By the end of this calendar year, we're planning for only about 10% of U.S. products to be sourced from China. We also invested in a strong globally recognized brand in superior products, which we believe provides brand loyalty and importantly, pricing power. We have a pristine balance sheet offering financial flexibility, and we invest in people. We have a very experienced operational and commercial team who build expertise through the tariffs of the two previous administrations as well as through COVID-19. Their expertise, frankly, is unmatched in our industry. With this advantaged starting point, our approach for the year ahead will be based on three core principles. One, we're going to play offense. We aim to decisively expand market share at this time. We exited fiscal year '25 with great momentum, and we believe continued investments in R&D, marketing, and sales will help us drive lasting competitive advantage. Two, cost discipline will be critical, both when it comes to product cost and OpEx, especially G&A. And three, agility. We are moving very rapidly to leverage our broad manufacturing footprint and take the necessary commercial actions. We know things are fluid, and we're acting fast. So as we look at the first quarter of fiscal ‘26, we expect a number of dynamics to shape performance. Not all of them certain at this point. Here's what we know. We know that the current set of tariffs and exemptions represent about a 200 basis point hit to global gross margins in the first quarter. That impact is mitigated in Q1 by the fact that we're still selling through inventory that we were able to proactively pull into the U.S. before April. Matteo will provide more detail. We also know that we have announced a set of targeted price increases to customers in the United States, which are being implemented from mid-April. We don't necessarily like to raise prices, but the current context requires it. Our increases are intentionally tailored to select products rather than a one size fits all approach. We've taken into account the role of each product, strategic price points, and how to best optimize value for our consumers and B2B customers. Some prices have remained unchanged, others have seen double digit percentage increases, and some fall in between, reflecting a thoughtful targeted approach. If needed, we believe we have more room for pricing later in the year. So that's what we know, but there's also much that we cannot yet know. Even in the current quarter, our final outcomes will depend on any changes that may be made to trade policy, including the scope of tariffs, the countries and the products affected, timings and exemptions. The outcomes will also depend on macroeconomics and consumer as well as B2B customer sentiment and behavior. And finally, there may be geopolitical factors that will shape demand globally. Despite all that uncertainty, we are providing a financial outlook for the first quarter of our 2026 fiscal year. Matteo will provide the details in just a minute. But at the midpoint, the outlook calls for continued top line growth supported by healthy growth and operating income margins. The bookends of our outlook essentially contemplate what we believe are possible outcomes based on the known unknowns I just outlined: trade policy, consumer and enterprise sentiment, and geopolitical factors. All of that said, what matters beyond the headlines is that the fundamentals of our business are strong and that we operate from an advantage starting point. Across fiscal ‘26, we are going to play offense while exercising strong cost discipline and acting with agility. Logitech was built to compete at times like these, and that's what we plan to do in the year ahead. Matteo, over to you.

Alright. Thank you, Hanneke, and thank you all for joining us on the call today. So the team delivered another good quarter with solid demand and high gross margins of 43.5%. The detailed financial results can be found in the press release and shareholder letter, but let me briefly share with you the key financial highlights. Now the fourth quarter represented the fifth consecutive quarter of year-over-year net sales growth. For the quarter, sell-through outpaced the sell-in by approximately two points as we aligned our channel inventory with demand following the holiday season. Channel inventory ended within our operating targets, while owned inventory ended the quarter up approximately $20 million quarter over quarter as we proactively built our inventories in advance of the tariffs taking effect. Now within our product categories, keyboards and combos and pointing devices performed very well as the high end of our product lines, the MX and Ergo had record quarter sales in the quarter. Webcams delivered mid-single digit net sales growth and end user demand remained strong across our gaming portfolio. So for the full fiscal year of 2025, total net sales increased by 7%, in line with the outlook that we provided at our third quarter earnings call and during the Investor Day in March. Our top line growth year-over-year was broad based across all regions and across our key product lines with the exception of webcams. However, webcams finished the year with strong momentum and we remain the market leader in this key category. Our growth continues to be extremely profitable with non-GAAP gross margin rate of 43.5% for the full year of 2025. So for the fiscal year of 2025, non-GAAP gross margin rate increased by 170 basis points compared to the prior year, thanks to a reduction in our product cost, partially offset by higher promotions and the negative impact of foreign exchange. Operating expenses were approximately $1.2 billion for the year, corresponding to 26.5% of net sales. Now this amount includes approximately $23 million of bad debt reserve recorded in sales and marketing expense due to the inability of our e-commerce payment provider, Digital River to pay us. Now of this amount, $40 million was recorded in the third quarter and the balance was recorded in the fourth quarter. So if we exclude the impact of this charge, our operating expenses as a percentage of net sales would have been 26%. So for fiscal year ‘25, non-GAAP operating income was $775 million or 17% of net sales, up 70 basis points compared to the prior year as a result of the gross margin expansion that I just mentioned. Our cash generation continued to be extremely strong. We generated approximately $840 million of cash from operations, more than 1x the operating income, of which approximately $800 million was returned to shareholders in the form of dividends and share repurchases. Our cash balance at the end of the year was $1.5 billion. I would like to congratulate the entire Logitech team for an outstanding fiscal year in 2025. We returned to high single digit profitable growth, generated strong cash flow and in the absence of M&A, we returned cash that we generated back to our shareholders. Now looking ahead to fiscal year 2026, we are not immune to the tariff uncertainty and the overall volatility in the current macroeconomic environment. Our ability to provide a long term outlook is predicated upon a modicum of stability within the broader economy. And without the stability, it is virtually impossible to provide an outlook that looks beyond the next quarter. Hence why we withdrew our outlook for the fiscal year ahead. So today, we are providing a financial outlook for the first quarter of our fiscal 2026 year. Net sales in the quarter are expected to be between flat to plus 5% in constant currency compared to the prior year. Gross margins will be between 41% and 42%, and non-GAAP operating income between $155 million and $185 million. Now in the first quarter, the negative impact of the current tariffs on our global gross margin rates will be approximately 200 basis points. This impact is mitigated in the first quarter by the fact that we are still selling through the inventory that entered the United States before April. Otherwise, we estimate the impact would be approximately 500 basis points at a company level. The range of our outlook incorporates different outcomes on the variables that are currently unknown, such as the consumer and the enterprise sentiment and the timing of the price realization in the quarter. So for sure, the environment is challenging, but as Hanneke pointed out, Logitech is built for this. So with that, I think we can turn over to Q&A.

Thank you, Matteo. We will now move into the Q&A session. Our first question will come from Asiya Merchant with Citi.

Great. Thank you, everyone. Just if I can double-click a little bit on the gross margins, how we should think about that. You're talking about some impacts here. And with respect to the pricing that's gone through, is that reflected in your June guide, on the top line as well? If you can just kind of parse out the impact on the top line from the price increases and then how we should think about gross margins, given the tariff impacts that you just highlighted?

Sure, Asiya. Sure. Thank you for your question. The way I would describe the gross margin rate, so we are going from about 43.5% roughly in the first quarter of last year to about 41.5%. As I mentioned in the prepared remarks, about 200 basis points negative impact comes from the tariffs. And this obviously factors in the fact that we are still consuming the inventory that came in before the tariff took place. We have about another 100 basis points of impact coming from the affected last year in the first quarter, if you recall, we were still releasing some previously recorded inventory reserve as the inventory was coming down. And we are not expecting this to happen again in the current quarter. So this negative impact of about 300 basis points when you combine both factors are partially offset by about 100 basis points of positive income coming from price. So if you look at the price, as Hanneke mentioned, we don't like necessarily to raise price, but we had to. And this is really focused on the U.S. We did a very meticulous approach. We looked at SKU by SKU. And some products are price didn't change, others increased double digit, and we have a bunch of products in the middle. But when you normalize and factor all of this in, that's about 10% of price increase on our U.S. product. And keep in mind that, you know, it's great to be a Swiss and global company today, and only about a third of our revenue is coming in the United States. So that's how you unpack the numbers.

Thank you. And any early indications on how customers are reacting to these price increases? I guess they go in in April. So I don't know if you have any early indications on that.

Yeah. It's too early really to say. We started implementation from mid-April. It always takes a little while for these prices to be reflected on shelves across the country and online. So really too early to say, but we do believe from previous price increases around the world that our strong brand and our superior products will protect us to a large extent. Sometimes there's a bit of an impact in the short term. We will see.

Our next question comes from Erik from Morgan Stanley. Erik?

Hey, guys. Good afternoon. Thank you for taking my questions here. Two, if I may. One, and realize we're in a pretty unprecedented period here. So, Hanneke, I kind of completely understand where you're going with your comments on kind of global production. 40%, from of global production or of U.S. production comes from China. Today, the goal is to get by 10% by the end of calendar ‘25. I'm just wondering what that means for your Suzhou facility. Does that just mean that you're shifting most production of Suzhou to international markets? Or are you downsizing that facility? And really the question comes from historically this has kind of been an area of strength for Logitech. You get IP production, you get flexibility to respond to demand. So just curious kind of what this means for Suzhou, and again, how we should be thinking about, then where your U.S. product will then come from if it's not China? And then a quick follow-up, please.

Yeah. Sure. Thanks, Erik. Great to see you. I'm not worried about Suzhou. Because, again, if you do the math, 70% of our sales are not for the United States. And already, only 40% of what does go to the United States is in China, and that will go to 10%. It's actually a relatively small part. And of course, Suzhou will continue to play a very large role in terms of production for the rest of the world. So, Suzhou is nice and full. The fact that we just had such a great year with 7%, top line growth obviously also helps to fill Suzhou. So no worries there. Where does that U.S. volume go? We're in the fortunate position that we have invested in a really diversified manufacturing footprint. We're China plus five other countries today. So while I won't say it's easy to shift volume, our team is doing a fantastic job at shifting volume fast to mitigate tariff impacts.

Okay. I appreciate that. Thank you, Hanneke. And then, I realized that Asiya’s question was maybe about how customers have responded to pricing increases. Maybe I'll ask it different ways. Just how is spending linearity tracked kind of quarter to date, whether that's versus past June quarters or past Aprils or even relative to the month of March? And really just trying to get at pull forward versus push out of demand. How are you seeing customers respond to just general tariff and policy volatility with their wallets, whether that's an enterprise, an SMB, or a consumer? Just how is the customer responding over this last month of chaos relative to either past years or last quarter?

Yeah. Let me have a stab at that. So on the consumer side of our business, I'd say the consumer remains very resilient for our products. So in the last quarter, so, in March, there was low single digit market growth in the Americas and in Europe in our categories and high double-digits in APAC. And consumer demand for our strong results also was strong as you see in our numbers. We also grew share across regions. So in March, things were looking really good. And on the consumer side, again, in North America in the last four weeks, we're kind of seeing a range of behaviors. There's certainly, you see it on TikTok, this kind of no buy movement. So there's some people who are really starting to be frugal. There is also a significant amount of consumers who are pulling purchases forward. And then there's also a segment I would call it YOLO. You only live once. I'm going to spend it all right now, and I'm going to spend it on expensive stuff. So the truth is probably somewhere in the middle. But, again, I would say that some of that is that the consumer for our brand and our products remains pretty good around the world. On the B2B side, in the last quarter, we did see a bit more caution, especially in Europe, driven by the uncertainty in the market. And I think most companies are just a little more hesitant to pull the trigger on big purchases, big CapEx investments. That said, global demand even on Logitech for Business was still comfortably positive mid-single-digit up. So we're optimistic. And of course, video conferencing in and of itself is kind of a natural hedge. As companies say, I want to reduce T&E, I want to reduce travel. You need great video conferencing to offset that.

Our next question comes from Samik Chatterjee with JPMorgan.

Hi. Thanks for taking my question and hope you can hear me. Maybe, just following up on Erik's question on the demand side, another way, which is, you did have sell-in tracked better than sell-through in the quarter by 200 basis points. And from what I remember, the expectation was in fiscal ‘25, you had an inventory build in the first half and you were expecting some moderation in that inventory in the second half. So did that run a bit counter to what you were expecting in the quarter? In relation to sort of price increases, did you see the channel actually pull forward some demand into the quarter? And what are you expecting as you go through more of the first quarter of, or the June really? And I have a follow-up.

Samik, actually, the sell-through outpaced the sell-in in the fourth quarter. So it's the other way around, which is actually what really we were expecting, which is pretty normal coming out from the holiday quarter. And to Hanneke’s point earlier, we're very happy with where the channel is, where the channel ended the year. Obviously, our own inventory was a little higher because we took the proactive steps to bring in some products before the tariffs. But overall, we should not see the same dynamic that we saw in the beginning of fiscal year ‘25, where the channel was too low and we had to sell-in, outpace and sell-through for the first few months. Our plan is to have sell-in mirror the sell-through in the upcoming quarters. Thanks to the work that the team has done in making sure that we had a healthy channel in the fiscal year.

Yeah. And just to reemphasize that, so what we said all along from a year ago is that in the first half sell-in would be greater than sell-out and in the second half sell-out will be greater than sell-in. That's exactly what played out. And that's why you see, that for the year as a whole, the fiscal net sales and sell-out are pretty much in the same space. The sell-out data is never perfect, but it's close enough for government work.

Got it. Thank you. Thanks for that. I apologize. I might have read it wrong. So maybe just going back to the discussion on tariffs and the first quarter sort of the fiscal year we are planning you have the benefit from price, but you have sort of a part headwind from the tariff. What's the end goal here by the time you get to moving most of that capacity that's addressing the U.S. demand? Once you get to that point, are we back to where your gross margins are in this sort of 43% range? Because pricing ramps up further and you have offset most of that? Or what do we see as a residual impact? How do you think about the residual impact at that point?

Yeah. It's really too early for us Samik, to speculate on that. There's just too many moving pieces at this point, which is why we're only giving you an outlook for the first quarter. What I can say, let me give you a little bit more color on some of the variables that could change, and why we can't speculate on what the outcome might be. So let's start from a great thing, which is that two-thirds of our sales are outside of the U.S., so they're not affected by tariffs. That's a good start point. But for the one-third that's in the U.S., that portfolio of products is affected in a number of different ways today. The tariffs themselves, the exemptions, the countries of origin, the product classification, the way we're moving products around. So as I look at the business today, part of the U.S. volume is exempt, zero tariffs. Part is at 10%. Part is at 20%. And there's a small part that's today at a 145% plus. But all that said, it's a moving feast. The impact literally is changing on almost a daily basis based on trade policy announcements, product classification, and importantly by our own actions as we move products around. So given that it's a moving feast, rather than providing you with details on how the sausages are being made, we're sharing the expected outcome for the first quarter with you, which is that 200 basis points of tariff impact on the global gross margin. And we're going to continue to update you as the year unfolds, but it is too early to speculate on what might happen after.

Maybe let me add, Samik, I think it's important also to put into perspective what we control. Right? So and some of the actions they were taking. So Hanneke discussed about price. We are also proactively took actions, in some of the cost complaint. Right? So one, product cost. I think we have a fantastic track record. You saw what the team and Shree and the team have done in 2025, almost 300 basis points of the margin expansion that you saw in total year came from their work. So that work will continue, will never stop. And then we took some proactive approach on, on the OpEx side, right, particularly on G&A. So as you hear many companies doing around the world, we are doing the same. We are curbing all the controllable spend. We are cutting travel. We delayed most of the hirings. And then obviously, we are pushing, and as Hanneke mentioned earlier, the manufacturing diversification, which will take us from the 60% to the 10% that we just discussed. So that's what you can count on us. The rest is difficult for us to control.

Our next question comes from Austin Baker with Loop Capital.

Hi. Thanks for the time. Hope everyone can hear me. I guess to peel the onion back a little bit, we'd just love to talk about kind of in a uncertain macro environment. What do you guys feel are probably the most in these demand resilient products? And then secondly strategically, I know you spoke about going on offense. Where would you want to spend the most focus and the most time? What categories, in that kind of weak slash uncertain macro environment?

Great question. Thank you. As we progress through the year, our three principles focus on playing offense and gaining market share, which will ultimately strengthen our position. We believe that by maintaining cost discipline, being agile in manufacturing, and implementing certain commercial strategies, we can achieve this. In terms of resilience, I see it across our entire portfolio, starting with gaming. We've gained significant insights from the gaming sector in China, which has experienced a challenging economy but a growth rate exceeding 20%. Last year, we initiated our 'China for China' program, and I’m pleased with the positive results. We understand that even in tough economic times, there can be a tendency for consumers to spend on gaming gear when they cut back on outings like movies or vacations. This trend was evident in China, and we are optimistic about gaming. We expect gaming to deliver double-digit growth for us in fiscal 2025, highlighting strong momentum. Additionally, on the productivity front, as people continue to work from different locations, there's an increased demand for our products. Whether working from home, the office, or traveling, consumers need multiple mice, keyboards, and video conferencing tools, especially as travel becomes limited. We believe that our portfolio is well-positioned for the future.

Our next question comes from Michael with Vontobel.

Yes. Hi. Good evening. Hello, everyone. Two questions from my side. The first one is in terms of shifting your production footprint for U.S. products. Maybe, can you comment on sort of what the hurdles are? How is that phased through the year? Or maybe which products are more difficult to move than others? And my second question would be on the logistics environment that you're seeing right now. Are you seeing any particular spikes in freight rates? Any bottlenecks? Any disruptions in terms of trade flows right now?

Yeah. I'll leave the logistics question to Matteo just now. But on the, moving our manufacturing footprint, we have invested for six or seven years now in having a much more resilient footprint. So the fact that we're, I would call it, China plus five today, five other countries where we make multiple, multiple products, makes it, I think, it's never easy, but it is more doable for us to move very quickly than for many others because to set up a new country with its supplier ecosystem, with the labor that you need there, is not easy. But we have done it. It's in place, which, again, our team is doing heroic work, but it's easier than if we had to start from scratch, which is why we feel that or why we know that by the end of the year, again, we'll go from 40% products in the U.S. originating from China to about 10%. And that's absolutely doable and it's doable across most of the portfolio. And we're always looking at individual SKUs. If there's an opportunity to simplify the portfolio, we also will always do that. But I'm not worried about specific parts of the portfolio that cannot be moved.

Michael, regarding freight, we haven't observed significant changes in pricing so far this quarter. If I look at the different routes, there might be slightly lower prices on the lane from Asia to Europe, but I haven't noticed any changes for the Asia to U.S. route. It remains somewhat elevated compared to the first quarter of 2026 versus the first quarter of 2025. While it seems reasonable to anticipate that rates could decrease based on current news, we haven't experienced that yet.

Our next question comes from Didier from Bank of America.

Yeah, good afternoon. Thanks for taking my question. I just have a couple. First of all, thank you so much for all the insights, numbers that you've shared with us on the impact of tariffs. I appreciate it must be incredibly difficult at this time to navigate this very uncertain environment. So really extremely grateful. My question would be first on the September. So you've talked about the June gross margin benefiting from inventories that are shipped into the channel prior to tariffs. Is there any lingering positive effect that we can expect in the September? And then on the maybe December, how should we think about the impact of tariffs as things stand with regards to the moving out of China impact, does do your gross margins drop a lot effectively in the September and perhaps in the December before they ramp back up? How should we think about the phasing?

So, let me start with the first question, sorry.

On the September. I think overall, Didier, it is too early to speculate on any of that. But I'll let Matteo answer.

The inventory will be depleted. So the positive impact of the inventory, that's why we are planning the way we did, specific for the first quarter, and that will be gone after the first quarter. So that's, I think, it's fair to say. The second part of your question, quite frankly, as Hanneke said, is a little premature for us to comment.

Thank you so much for that. Just want to double-check one thing. I think the answer is yes. Just want to make sure the 90-day pause that we saw on the headlines on smartphone and PCs, they do include PC peripherals as far as you understand?

Yeah. So all the numbers that we've given you for Q1 take into account tariffs as they stand today, which includes the 90 day pause. So where I said, you know, we have part of the portfolio for U.S. that's at zero percent. We have a part at 10%, a part at 20%, and a part at 145% plus at the moment. So the answer is yes.

Our next question comes from George with Barclays.

Hey, guys. Thanks for taking my question. Two quick questions. So firstly, just maybe you can elaborate on this 500 basis points impact on the gross margin without any more selling through the inventory pre tariff. Just curious if we should assume no price hike on existing products for your base case for to calculate this 500 basis points? Because to me, it seems a little bit high in terms of impact. Just curious if you can give a bit more color, assumptions behind it.

Sure. So George, the 500 basis points, let me unpack it for you, includes the impact of the tariffs as they stand today and the impact of the manufacturing diversification actions as they stand today. It does not include the price, the impact of the price actions, right. So that's where we will have to see obviously how the consumer and the enterprise customer will behave and really our ability to realize the price increases that we communicated in mid-April. So 500 is just the impact of the tariffs, net of the manufacturing actions.

Yeah. And again, we have taken pricing now, and Matteo outlined that's so in the first quarter, 200 basis points of negative tariff impact and 100 basis points positive of pricing. We will see. There might be more room for pricing, but again, too early to speculate on what or when that might be.

Okay, great. Just a quick follow-up to just kind of talk about items you can control in terms of operating expense control, kind of G&A. You kind of alluded to maybe tighter control. Can you elaborate on other levers you guys can pull? Just curious if we should expect a bit more of a tighter control just on the operating expense on G&A kind of can pull through more accretion to the EPS side.

Sure, George. So I think it goes beyond OpEx, it's really control around cost. So it's both the product. So back to some of the things that we discussed at Investor Day, all the activities of value engineering, supplier cost reduction, so that will continue. And we have a very good track record as you've seen in the numbers that we published today, even in the fourth quarter of ‘25. Then specifically on the operating expenses, we're going to be laser focused. We're going to primarily focus our actions on G&A. We will continue obviously to fund the investment in product development and sales and marketing. Back to the principles that Hanneke mentioned at the beginning of the call. And on G&A, we are really working on a couple of buckets. We are curbing all the controllable expenses such as the contractors, outside services, consulting, cutting T&E and delaying most of the hires. And that's kind of the actions that we are taking.

That was our last question for the raised hands. We do have some submitted questions from Joern with UBS. Joern's having some audio issues. So I'll just read those out loud if that's okay. One of the questions was sell-through in EMEA slowed down materially, and why is this happening?

Yeah. Happy to talk about Europe. The first thing I'll say about Europe is that they had a great fiscal year ‘25. 9% constant currency sales growth is just testament to fabulous execution by our team in Europe, and that's growing well ahead of the European market for the year. Q4 was a little slower, and that's there are a couple of reasons. Inventory adjustments in Europe, we were probably most assertive in terms of making sure we had a great holiday season, which we did have, but we were assertive on bringing that back down. But like in other regions, we're seeing a resilient consumer in Europe. Maybe a little bit of caution again, same as the global dynamic amongst B2B customers that was exacerbated by the German elections that also fell in the quarter. Just a little bit of caution there. But we definitely are confident that that business will return to growth.

Okay. One more question here. What is the price versus volume assumption for Q1 ‘26?

We have about a 100 basis points on the gross margin coming in, thanks to price. So I'll let you do the math, but that's the assumption that we have in the first quarter.

Thank you. And this would be our final question. How can you organize the supply chain so quickly that only 10% of U.S. sales will come from China end of the year?

Yeah. Again, this company was built to compete at a time like this. I cannot say it often enough. We have a global very broad global sales footprint, so only 30% of our volume is U.S. But that U.S. volume, which is obviously really important to us, we have been preparing since 2019 to be super resilient on that. So we have China plus five manufacturing countries in place and ready to go and producing for us today, which is a huge competitive advantage and is allowing us to move much faster than most.

That was our final question. Thank you.

Thank you so much. Thanks, everyone. Thanks for bearing with us at this fun time. We really appreciate you joining us. I just want to summarize to say that our teams had an outstanding 2025 fiscal year. So thank you to our teams. And looking ahead, I am excited about the opportunity that's before us. We are going to play offense. We're going to assertively manage costs and continue to be super, super agile. And we look forward to speaking with you next quarter. Take care, everyone.