GN Store Nord, the company behind Jabra audio products, announced plans to gradually phase out its Elite and Talk lines. This decision aims to concentrate resources on more promising areas within the company, emphasizing prioritizing lucrative markets for maximized growth and returns.
Jabra Elite Line Profitability Not Enough, Talk Line Faces Market Decline
While the Elite line’s premium focus yielded profitability gains in 2023, future innovation necessitates excessive investment deemed unsustainable. The declining demand for mono Bluetooth headsets justifies a similar move for the Talk line.
CEO Emphasises Strategic Shift, Thanks Partners and Customers
“This decision aligns with our commitment to prioritize attractive markets,” said GN CEO Peter Karlstromer. “We’ve proven our competitiveness through market-leading technology and strategies, particularly with the Elite line’s innovative true wireless earbuds.”
Acknowledging market shifts, GN prioritizes investments with greater return potential within its Hearing, Enterprise, and Gaming segments. The company expresses gratitude to its partners and customers and promises a smooth wind-down process. This includes support for existing customers and the launch of the final Elite products – the next-generation Elite 8 Active and Elite 10 earbuds.
Financial Impact: Short-Term Revenue Dip, Long-Term Focus
The wind-down will impact GN’s 2024 revenue, with an estimated DKK -450 million decrease in the Consumer business. The strong performance of the Hearing division is expected to partially offset this decline. GN has revised its group organic revenue growth guidance to “2% to 6%” and EBITA margin guidance to “12% to 13%.”
However, the wind-down presents a positive for GN’s long-term goals. It aligns with the company’s targeted margin expansion and frees up resources for investments in promising areas. GN maintains its ambition for a 5-8% CAGR organic revenue growth.
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Source: GN Press Release
