8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D)

OF THE SECURITIES EXCHANGE ACT OF 1934

DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): OCTOBER 19, 2004

Plantronics, Inc.

(Exact name of Registrant as Specified in its Charter)

Delaware	1-12696	77-0207692
(State or Other Jurisdiction of Incorporation or Organization)	(Commission file number)	(I.R.S. Employer Identification Number)

345 Encinal Street

Santa Cruz, California 95060

(Address of Principal Executive Offices including Zip Code)

(831) 426-5858

(Registrant's Telephone Number, Including Area Code)

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition.

On October 19, 2004, Plantronics, Inc. issued a press release reporting its results of operations and financial condition for the second fiscal quarter ended September 30, 2004, a copy of which is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

The information contained herein, including Exhibit 99.1 attached hereto, is intended to be furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such filing.

Item 7.01 Regulation FD Disclosure

The following information is furnished pursuant to Item 7.01, "Regulation FD Disclosure."

On October 19, 2004, Plantronics, Inc., a Delaware corporation, announced that our Board of Directors had declared a cash dividend of $0.05 per share of our common stock, payable on December 10, 2004 to shareholders of record at the close of business on November 12, 2004.

A copy of the press release is attached as Exhibit 99.2 hereto.

Item 9.01 Financial Statements and Exhibits.

The following exhibits are furnished as part of this report:

Exhibit Number Description

99.1 Press Release issued by Plantronics, Inc. dated October 19, 2004.

99.2 Press Release issued by Plantronics, Inc. dated October 19, 2004.

	PLANTRONICS, INC.
Date: October 19, 2004	By:	/s/ Barbara Scherer
		Barbara Scherer
		Chief Financial Officer

EXHIBIT INDEX

Exhibit Number Description

99.1 Press Release issued by Plantronics, Inc. dated October 19, 2004.

99.2 Press Release issued by Plantronics, Inc. dated October 19, 2004.

EX-99.1

PRESS RELEASE

Plantronics Reports Record Earnings for the Second Quarter of Fiscal Year 2005

FOR INFORMATION, CONTACT: Debbie Peterson Investor Relations Manager (831) 458-7533 FOR IMMEDIATE RELEASE October 19, 2004

SANTA CRUZ, CA. - October 19, 2004 - Plantronics, Inc., (NYSE: PLT) today announced record earnings for its second quarter of fiscal year 2005. Second quarter revenues increased approximately 37% to $130.2 million, in comparison to $95.1 million in the second quarter of fiscal 2004. Operating income increased to $33.4 million from $17.5 million, net income increased to $24.7 million from $12.4 million, and diluted earnings per share improved to $0.49 from $0.27, in each case from the year-earlier quarter.

Net income for the quarter was inclusive of an after tax benefit of $1.6 million or approximately $0.03 per share from a court decision fully upholding Plantronics’ position which ended a lawsuit filed by a competitor. Ken Kannappan, President and CEO, commented, "Our results, inclusive of the $1.6 million after tax benefit, were above the high end of the guidance we provided on July 20, which called for revenues of $124 to $130 million, and earnings per share of $0.42 to $0.46. As anticipated, revenues from mobile products were lower sequentially and were offset by higher revenues from our Office and Contact Center products as well as growth in our Computer Audio and Gaming products."

"Revenues from our Office and Contact Center products were $86.2 million, up 34% vs. the year-earlier quarter and up approximately 4%, or $3.4 million, sequentially. This was a new all-time record for quarterly revenues in this product group," noted Kannappan. In comparison to the year-earlier quarter, the growth was geographically broad-based and resulted primarily from the adoption of our wireless headsets for business professionals as well as the success of the SupraPlus™ headset launched in March. In comparison to the June quarter, growth was concentrated in North America with the EMEA region down sequentially.

Barbara Scherer, SVP and CFO, said, "Our inventories increased significantly in the quarter and our turns fell to 3.7, below our goal of 5.0. The largest single reason for the increase in inventories is to support the increased revenue level we are anticipating for the December quarter. However, approximately $4 million of the increase was the result of upside revenue opportunities that we thought were likely to occur in the second quarter, but which did not materialize. Finally, we have also increased our safety stocks on certain key components. We currently expect our inventory turns to improve in the December quarter in comparison to the September quarter. Our DSO increased to 51 days, in comparison to 49 days in the September quarter a year ago, and from 47 days in the June quarter. We generated $8.1 million in cash flow from operations in the second quarter and have generated $41.5 million on a year to date basis."

Business Outlook

The following statements are based on current expectations. Many of these statements are forward-looking, and actual results may differ materially.

We remain cautiously optimistic about the overall economic environment and demand for our products. We feel that caution remains warranted given concern about recent signs of a slowdown in the rate of U.S. GDP growth, the level of unemployment in the United States, the level of budget and trade deficits in the United States, the impact of a weak dollar on the U.K. and Euro region economies and ongoing tensions in the Mid-East. Given these and other factors, we remain uncertain concerning the strength and sustainability of the economic environment and the related outlook for headset demand.

We also consider the trends in sell-through of our U.S. commercial distributors of office and contact center products an important indicator of demand. For the September quarter, this group of distributors reported to us an increase in sell-through of over 25% in comparison to the September quarter last year, and a 10% increase sequentially. We believe the number of weeks on hand of inventory that this channel is carrying increased slightly. 

We have a "book and ship" business model whereby we ship most orders to our customers within 48 hours of our receipt of those orders, and we thus cannot rely on the level of backlog to provide visibility into potential future revenues.

Our current expectations for the third quarter of fiscal 2005 are:

• Revenues to be in the range of $147-$152 million. Our current revenue expectations translate into revenue growth of approximately 37% to 41% versus the year-earlier period and approximately 13% to 17% sequentially.
  
  We currently believe that revenues from our new gaming products will be a significant portion of the increase together with increased shipments of wireless headsets for mobile and office applications. If our anticipated revenue mix is realized, we believe the percent of revenues contributed from our Office and Contact Center product group will decline from 66% of revenues in the second quarter, but rise in absolute dollars. We are also planning for a $1 million reduction to revenue in comparison to the second fiscal quarter for payments to ch annel partners for catalog placements and other market development funds. That incremental $1 million directly reduces revenue and gross profit, in accordance with Emerging Issues Task Force 01-09. As a result of the above factors, we are therefore expecting gross margins to decline in the December quarter and to be approximately 49% - 50%.
  
• Operating expenses to increase in dollars and potentially as a percent of revenue in comparison to the second quarter as a result of several factors including that operating expenses were $2 million lower in the second quarter as a result of the litigation benefit. Beyond that, our market opportunities are expanding and we are preparing for that growth by expanding the range and depth of our new product pipeline, increasing our marketing programs and sales presence, and growing our operations and administrative capacity.
  
  
• Operating margins to be in the range of 21% - 22%.
• Earnings per diluted share to be in the range of $0.45 to $0.48.

Plantronics does not intend to update these targets during the quarter or to report on its progress toward these targets. Plantronics will not comment on these targets to analysts or investors except by its next press release announcing its third quarter fiscal year 2005 results or by other public disclosure. Any statements by persons outside Plantronics speculating on the progress of the third quarter of the fiscal year will not be based on information endorsed or supported by Plantronics, and should be assessed accordingly by investors. The statements do not reflect the potential impact of any mergers or acquisitions that may be completed after the date of this release.

Conference Call Scheduled to Discuss Financial Results

Plantronics has scheduled a conference call to discuss the contents of this release. The conference call will take place today, Tuesday, October 19 at 2:00 PM (PDT). All interested investors and potential investors in Plantronics stock are invited to participate. To listen please dial in five to ten minutes prior to the scheduled starting time and refer to the "Plantronics Conference Call." Participants from North America should call (888) 301-8736 and other participants should call (706) 634-7260.

A replay of the call with the conference ID #6645196 will be available for 72 hours at (800) 642-1687 for callers from North America and at (706) 645-9291 for all other callers. The conference call will also be simultaneously web cast at www.plantronics.com under Investor Relations, and the web cast of the conference call will remain available at the Plantronics Web site for thirty days.

PLANTRONICS, INC. / 345 Encinal Street / P.O. Box 1802 / Santa Cruz, California 95061-1802

831-426-6060 / Fax 831-426-6098 

SAFE HARBOR

This release contains forward-looking statements within the meaning of Section 27A of the Securities Exchange Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Specific forward-looking statements include our outlook for revenues, gross margins, operating expenses, operating margins, and earnings for the third quarter of fiscal 2005; that revenues from gaming and mobile products are expected to increase in the December quarter; that inventory turns will improve; and that we are cautiously optimistic about the overall economic environment and the demand for our products. These forward-looking statements involve a number of risks and uncertainties, and are based on current expectations, forecasts and assumptions.

Among the factors that could cause actual results to differ materially from those projected are:

• A slowing in national or international economic growth, resulting in a reduction in the overall level of demand for our products;
• The demand for our wireless headset products may not develop as we anticipate and may lead to excess inventory and the inability to recover the associated development costs;
• The actions of existing and/or new competitors, especially with regard to pricing and promotional programs;
• Variations in sales and profits in higher tax, as compared to lower tax, jurisdictions and/or the results of tax planning strategies, tax audits, reassessment of tax reserves, and tax refunds on our effective tax rate;
• A softening of the level of market demand for our products within our core contact center market and/or in the newer office, mobile, computer and residential markets;
• The entry of new competitors which could be spurred by changes in the regulatory environment, particularly laws requiring the use of hands-free devices by drivers when using cellular telephones;
• The inability to successfully develop, manufacture and market new products;
• Fluctuations in foreign exchange rates; and
• Changes in the regulatory environment either as to headsets directly or as to the products, such as mobile phones, with which our products are used.

Additional risk factors include: changes in the timing and size of orders from our customers, price erosion, increased requirements from retail customers for marketing and advertising funding, failure to match production to demand, interruption in the supply of sole-sourced critical components, continuity of component supply at costs consistent with our plans, failure of our distribution channels to operate as we expect, failure to develop products that keep pace with technological changes, the inherent risks of our substantial foreign operations, problems which might affect our principal manufacturing facility in Mexico, further terrorist acts, our nation's response to terrorist attacks and the effects of these activities on capital and consumer spending, and the loss of the services of key executives and e mployees. For more information concerning these and other possible risks, please refer to the Company's Form 10-K filed on May 26, 2004, filings on Form 10-Q and other filings with the Securities and Exchange Commission as well as recent press releases. These filings can be accessed over the Internet at http://www.sec.gov/edgar/searchedgar/companysearch.html

Financial Summaries

The following related charts are provided:

• Summary of Unaudited Consolidated Financial Statements
• Summary of Unaudited Statements of Operations and Related Data
  

About Plantronics

Plantronics introduced the first lightweight communications headset in 1962 and is recognized as the world leader in communications headsets. A publicly held company with approximately 4,400 employees, Plantronics is the leading provider of headsets to telephone companies and the business community worldwide. Plantronics headsets are also used widely in many Fortune 500 corporations and have been featured in numerous motion pictures and high-profile events, including Neil Armstrong's historic "One small step for man" transmission from the moon in 1969. Plantronics, Inc., headquartered in Santa Cruz, California, was founded in 1961 and maintains offices in 20 countries. Plantronics products are sold and supported through a worldwide network of authorized Plantronics marketing partners. Information about the Company and its products can be found at www.plantronics.com or by calling (800) 544-4660.

Plantronics is a registered trademark of Plantronics, Inc. Bluetooth is a trademark owned by Bluetooth SIG Inc., and is used by Plantronics under license. All other products or service names mentioned herein are trademarks of their respective owners

PLANTRONICS, INC. / 345 Encinal Street / P.O. Box 1802 / Santa Cruz, California 95061-1802

831-426-6060 / Fax 831-426-6098

PLANTRONICS, INC.
SUMMARY CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share data)
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
	Quarter Ended						Six Months Ended
		September 30,			September 30,			September 30,			September 30,
		2003			2004			2003			2004
Net sales	$	95,117		$	130,220		$	187,903		$	261,590
Cost of sales		46,351			60,719			93,670			122,422
Gross profit		48,766			69,501			94,233			139,168
Gross profit %		51.3	%		53.4	%		50.1	%		53.2	%
Research, development and engineering		8,247			10,838			16,852			20,882
Selling, general and administrative		22,984			25,305			44,137			54,225
Total operating expenses		31,231			36,143			60,989			75,107
Operating income		17,535			33,358			33,244			64,061
Operating income %		18.4	%		25.6	%		17.7	%		24.5	%
Interest and other income, net		141			913			633			1,248
Income before income taxes		17,676			34,271			33,877			65,309
Income tax expense		5,303			9,596			10,163			18,287
Net income	$	12,373		$	24,675		$	23,714		$	47,022
% to Sales		13.0	%		18.9	%		12.6	%		18.0	%
Diluted earnings per common share	$	0.27		$	0.49		$	0.52		$	0.93
Shares used in diluted per share calculations		46,372			50,638			45,672			50,532
UNAUDITED CONSOLIDATED BALANCE SHEETS
		March 31,			September 30,
		2004			2004
ASSETS
Cash and cash equivalents	$	180,616		$	210,283
Marketable securities		-			4,000
Total cash and marketable securities		180,616			214,283
Accounts receivable, net		64,999			73,892
Inventory, net		40,762			65,940
Deferred income taxes		13,967			8,046
Other current assets		10,283			10,750
Total current assets		310,627			372,911
Property, plant and equipment, net		42,124			49,959
Intangibles, net		3,440			3,326
Goodwill, net		9,386			9,386
Other assets		2,675			2,683
	$	368,252		$	438,265
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable	$	19,075		$	29,206
Accrued liabilities		36,469			38,292
Income taxes payable		5,686			6,484
Total current liabilities		61,230			73,982
Deferred tax liability		7,719			8,121
Long-term debt		-			-
Total liabilities		68,949			82,103
Stockholders' equity		299,303			356,162
	$	368,252		$	438,265

Summary of Unaudited Statements of Operations and Related Data
		Q103			Q203			Q303			Q403			FY03			Q104			Q204			Q304			Q404			FY04			Q105			Q205			FY05 YTD
Net sales	$	80,268		$	82,370		$	86,811		$	88,059		$	337,508		$	92,786		$	95,117		$	107,622		$	121,440		$	416,965		$	131,370		$	130,220		$	261,590
Cost of sales		38,810			40,735			44,290			44,730			168,565			47,319			46,351			51,381			55,944			200,995			61,703			60,719			122,422
Gross profit		41,458			41,635			42,521			43,329			168,943			45,467			48,766			56,241			65,496			215,970			69,667			69,501			139,168
Gross profit %		51.6	%		50.5	%		49.0	%		49.2	%		50.1	%		49.0	%		51.3	%		52.3	%		53.9	%		51.8	%		53.0	%		53.4	%		53.2	%
Research, development and engineering		8,250			8,164			9,004			8,459			33,877			8,605			8,247			8,834			9,774			35,460			10,044			10,838			20,882
Selling, general and administrative		19,606			19,763			20,939			20,297			80,605			21,153			22,984			23,649			27,970			95,756			28,920			25,305			54,225
Operating expenses		27,856			27,927			29,943			28,756			114,482			29,758			31,231			32,483			37,744			131,216			38,964			36,143			75,107
Operating income		13,602			13,708			12,578			14,573			54,461			15,709			17,535			23,758			27,752			84,754			30,703			33,358			64,061
Operating income %		16.9	%		16.6	%		14.5	%		16.5	%		16.1	%		16.9	%		18.4	%		22.1	%		22.9	%		20.3	%		23.4	%		25.6	%		24.5	%
Income before income taxes		14,535			13,980			13,144			15,101			56,760			16,201			17,676			25,170			27,452			86,499			31,038			34,271			65,309
Income tax expense		4,361			2,450			3,943			4,530			15,284			4,860			5,303			7,551			6,506			24,220			8,691			9,596			18,287
Income tax expense as a percent
of income before taxes		30.0	%		17.5	%		30.0	%		30.0	%		26.9	%		30.0	%		30.0	%		30.0	%		23.7	%		28.0	%		28.0	%		28.0	%		28.0	%
Net income after taxes		10,174			11,530			9,201			10,571			41,476			11,341			12,373			17,619			20,946			62,279			22,347			24,675			47,022
Diluted shares outstanding		47,722			47,298			46,197			45,190			46,584			45,077			46,372			47,501			50,068			47,492			50,428			50,638			50,532
EPS	$	0.21		$	0.24		$	0.20		$	0.23		$	0.89		$	0.25		$	0.27		$	0.37		$	0.42		$	1.31		$	0.44		$	0.49		$	0.93
Net revenues from unaffiliated customers:
Office and contact center		61,568			59,742			58,644			64,404			244,358			62,080			64,192			66,776			80,840			273,888			82,815			86,204			169,019
Mobile		10,125			11,779			16,145			12,039			50,088			18,518			18,370			29,528			25,914			92,330			34,458			28,815			63,273
Computer audio		2,605			4,429			5,679			5,781			18,494			5,463			5,679			5,807			6,752			23,701			6,992			8,515			15,507
Other specialty products		5,970			6,420			6,343			5,835			24,568			6,725			6,876			5,511			7,934			27,046			7,105			6,686			13,791
Net revenues by geographical area
from unaffiliated customers:
Domestic		55,614			57,426			57,013			58,889			228,942			64,924			64,929			66,484			80,880			277,217			89,088			89,375			178,463
International		24,654			24,944			29,798			29,170			108,566			27,862			30,188			41,138			40,560			139,748			42,282			40,845			83,127
Balance Sheet accounts and metrics:
Accounts receivable, net		44,714			51,303			51,927			50,503			50,503			49,852			52,033			64,425			64,999			64,999			68,521			73,892			73,892
Days sales outstanding		50			56			54			52						48			49			54			52						47			51
Inventory, net		37,695			35,659			34,884			33,758			33,758			37,510			37,764			39,178			40,762			40,762			47,418			65,940			65,940
Inventory turns		4.1			4.6			5.1			5.3						5.0			4.9			5.2			5.2						5.2			3.7

EX-99.2

PRESS RELEASE

Plantronics Declares Quarterly Dividend

FOR INFORMATION, CONTACT: Debbie Peterson Investor Relations Manager (831) 458-7533 FOR IMMEDIATE RELEASE October 19, 2004

SANTA CRUZ, CA. - October 19, 2004 - Plantronics, Inc., (NYSE: PLT) today announced that its Board of Directors declared a quarterly dividend of $0.05 per share. The dividend is payable on December 10, 2004 to shareholders of record at the close of business on November 12, 2004.

Ken Kannappan, President and Chief Executive Officer, stated, "Plantronics’ Board of Directors initiated a dividend policy earlier this fiscal year as part of our ongoing effort to enhance shareholder value. Plantronics’ strong financial position provides us with the flexibility to return some cash directly to our shareholders in the form of a regular dividend while continuing to invest in growing our business."

About Plantronics

Plantronics introduced the first lightweight communications headset in 1962 and is recognized as the world leader in communications headsets. A publicly held company with approximately 4,400 employees, Plantronics is the leading provider of headsets to telephone companies and the business community worldwide. Plantronics headsets are also used widely in many Fortune 500 corporations and have been featured in numerous motion pictures and high-profile events, including Neil Armstrong's historic "One small step for man" transmission from the moon in 1969. Plantronics, Inc., headquartered in Santa Cruz, California, was founded in 1961 and maintains offices in 20 countries. Plantronics products are sold and supported through a worldwide network of authorized Plantronics marketing partners. Information about the Company and its products can be found at www.plantronics.com or by calling (800) 544-4660.

Plantronics is a registered trademark of Plantronics, Inc. Bluetooth is a trademark owned by Bluetooth SIG Inc., and is used by Plantronics under license. All other products or service names mentioned herein are trademarks of their respective owners

PLANTRONICS, INC. / 345 Encinal Street / P.O. Box 1802 / Santa Cruz, California 95061-1802

831-426-6060 / Fax 831-426-6098