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DirecTV posts Q3 results
So we got a chance to listen in on DirecTV's third quarter earnings call the other day, and reflect on some of the comments made by their top brass. Seems like things are going pretty well over there, even with the problems a few of their subscribers are having with their new HR20 set-top boxes. The satellite company added a million new subscribers in the quarter, with seven percent more of those being "high quality" than the same time last year. High quality is a sly industry term to describe those customers who spend more than the norm on their bills, especially for HD and PVR add-ons. Of course, that implies that those who just get the regular channel packages or movies are somehow "low quality," but we'll leave that for another article, as I'm sure Dish and every cable company describes their customers the same way. In any case, they are signing up more of those types of subscribers, while also adding HD services, with 10% more HD DVRs than previously, and double the amount in use compared to 2005. While those figures are good to show that high definition is becoming more and more common, only nine percent of those new subs are HD. Assuming we read the numbers right, out of the million new people with DirecTV, only 90,000 picked up HD packages. I guess there is a long way for the industry to go before HD is absolutely everywhere... moving on, profits are up 143% from last quarter for the sat co., due to some accounting maneuvers as well as the higher profits to be had from those "higher quality" subs and lower costs to sign them up. Churn is down from last year, but still not quite to their goal of 1.8%, and execs claim that is mostly due to service or internal issues, and not from competition.While the company is still claiming the highest video quality (something that has been hotly debated and litigated about), they aren't feeling a lot of heat from the Fiber-to-the-Home crowd, and don't see much of an impact on their business from competition in that area. It makes sense considering most of the telecommunications companies are still in their beta stages, and have only in launched test communities. Once the telcos roll out on a larger scale, we'll see how it impacts the satellite and cable companies. Finally, DirecTV is looking to the future at possibly bundling their satellite video with WiMax or another wireless technology for data, much as their partners like AT&T and BellSouth do for their own triple-play voice/data/video combo packages. Next year's launch of two new satellites into orbit should also help with bandwidth issues and allow the launch of new HD channels to compete with the large number currently carried by cable and competitor satellite company Dish. All in all, I'd agree with the DirecTV execs who have a bullish outlook on the future of their company, and satellite in general, as there is plenty of HD to look forward to.
Earnings reports: Sony slumps, Nintendo, Microsoft surge
A trio of publicly filed financial reports for the most recent quarter (July through Sept. '06) have shed some light on the fiscal fates of the three major consoles makers going into the critical holiday period.First up is Sony, which posted massively reduced earnings as expected. The ongoing laptop battery recall accounted for much of the 94 percent reduction in profits, but slow sales of the PSP and Playstation 2 accounted for a 43.5 billion yen operating loss in the games division. Research and development costs for the PS3 also cut into Sony's bottom line for games. Sony is still predicting sales of 6 million Playstation 3 units by March '07.Nintendo's financial situation is much rosier, with profits rising 72 percent on strong sales of DS hardware and software. The company is shipping 100,000 DS units a week and is still unable to meet demand in some Japanese stores. Nintendo expects to sell 20 million DS units and 6 million Wii units this fiscal year (ending March 2007), helping pad down an net income forecast of 100 billion yen.Spurred on by higher software sales, Microsoft announced game revenue for the 360 and PC increased 107 percent ($319 million) in the past quarter. Microsoft's Entertainment and Devices Division (which includes the games unit) grew by 70 percent over the same period last year. The Xbox 360 sold 900,000 units in the quarter, pushing it over 6 million units sold worldwide, and putting it well on its way to selling an expected ten million systems by the end of 2006, according to Microsoft.Read: Sony reportRead: Nintendo reportRead: Microsoft report
Sony profits up in financial first quarter
After losing money in the same period a year ago, Sony outperformed analysts expectations in the April-June period and profited $276 million US. LCD sales of their BRAVIA line were up "five-fold" from last year, as their partnership with Samsung netted more than $29 million by itself. According to CFO Nobuyuki Oneda TVs were still in the red as a whole but were the largest contributing factor to their growth. Even including expected costs associated with launching the Playstation 3 this fall (Blu-ray format, the BDP-S1 and other non-Playstation products went notably unmentioned in the articles and internal documents we read ), they revised their operating profits forecast by 30% for the financial year ending next March.After a string of bad news, reviews and delays Sony may be ready to get back on a winning track and their big products for the holiday are still waiting in the wings.Read - Sony Returns to Profit in Fiscal 1Q - APRead - Sony Game Sales Down 30% - Next GenerationRead - Sony swings to Q1 profit, recovery on track - ReutersRead - Q1 FY2006 Sony Group Earnings Announcement - Sony
More on Majesco's fall from grace
CNN are featuring a look at publisher Majesco's problems, after the company's decision last week to withdraw from the premium console market. It's a sad tale of ambition backfiring and promising titles failing to live up to expectations, with a very real impact on the company's revenue and stock.The CNN article points out that Midway, Atari and Acclaim have all been to the brink of bankruptcy and back, Majesco may still make it through. The company's move towards budget and handheld titles, as well as emerging markets such as casual and downloadable games, seems a wise one--we may even see another Psychonauts in amongst the budget bin.[Thanks, Ashcrotch]
