The prevailing mood lately on Wall Street has been positive. That has sent a lot of individual stocks higher over the past several weeks, particularly those with technology connections.
Unfortunately, even some innovative companies that work on technological solutions as part of their everyday businesses still have to suffer significant share-price declines from time to time. That's been the case for Logitech International (LOGI 0.69%) and MicroVision (MVIS 5.63%) on Wednesday afternoon, as both companies are dealing with challenges that could pose some tough questions for their leaders to answer in the near future. Here's more on what's happening with Logitech and MicroVision.
Logitech needs a new leader
Shares of Logitech International fell 11% in mid-afternoon trading Wednesday. The maker of computer peripherals surprised its shareholders with unwelcome news. Now, the company will have to make a quick transition to return to its former glory.
Logitech announced that CEO Bracken Darrell had expressed his intention to leave the company to pursue other opportunities. The executive's resignation from his various roles in the corporate suite and on the board of directors was effective immediately, although Darrell agreed to stay on over the next month or so to help with the transition. Logitech named fellow board member Guy Gecht to act as interim CEO, pending a global search of potential CEO candidates both from within Logitech's ranks and outside the company.
Logitech was quick to tout Gecht's abilities. He served for four years on its board, which has given him considerable familiarity with the computer peripherals specialist and its business model. At the same time, the company recognized the progress it made with Darrell at the helm.
2020 and 2021 were great years for Logitech, as the work-from-home necessities of the early years of the COVID-19 pandemic dramatically boosted sales of keyboards, webcams, and other peripherals. Now, though, a reversion toward pre-pandemic demand levels has been a challenge for Logitech, and the company will have to work even harder with new management at the helm.
MicroVision cashes in
Shares of MicroVision got hit even harder, falling 27% in the mid-afternoon hours. The specialist in solid-state automotive lidar technology for use in advanced driver assistance systems announced a secondary stock offering to raise capital.
MicroVision isn't being too ambitious with its offering, having announced a $75 million sale that could grow to $86.25 million if underwriters exercise their option to purchase additional shares from the company. MicroVision didn't specify any particular use for the cash proceeds of the stock offering, saying only that it intends for the money to go toward general corporate purposes.
Nevertheless, the announcement threw cold water on what has been a meteoric rise for the stock in recent weeks. Having traded as low as $1.82 per share in late April, the stock more than quadrupled briefly, approaching $8 per share last week. The company still brings in almost no revenue and spends considerable amounts on research and development, so MicroVision took advantage of the rise in the stock price to raise capital.
MicroVision had $68 million in cash at the end of March, so this new infusion should help give it more time to develop and commercialize its product. Nevertheless, until the company proves itself, MicroVision might continue to attract short-sellers betting against the autonomous-vehicle stock.
