As far as I noticed it does so without any loss of image and sound quality (surprisingly enough)
I have to say one thing about the design though, it is a bit awkward. It would have been more logical if the connections would go in one side of the product OR that the switch HDMI button would be on a loose case with a wire or something. Now I have this octopus-like thing behind my TV... but hey, the price is low so I will stop complaining. :D
Oh and the free shipping is awesome!