Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Creative Labs (CREAF) -- Ignore unavailable to you. Want to Upgrade?

To: ronco who wrote (7617)	1/1/1998 4:11:00 PM
From: Brian Lempel	Read Replies (2) \| Respond to of 13925

Ronco, RE: CREAF meeting estimates. I don't think they will have a problem. While revenues have been flat versus year-ago numbers, this quarter should benefit by a large increase in DVD sales. It is hard to say how much it they will contribute, but using a conservative estimate of 150,000 units sold (probably slightly higher than this, since their ramp is targeting 100K/Month) and a $200 ASP (also probably much higher), that is 30 million in added revenue. Also to be considered is that CREAF will benefit more from the currency devaluation than is realized. You can't say it is totally beneficial, since sales will have to be lowered. It also probably won't affect gross margins very much, since lower margins in Asia will be offest by higher ones in US and Europe. I would, though, expect net profit margins to be higher because of lower labor costs, etc. The big question, IMO, is how rebates will affect this quarter. I am no accountant, but would this affect revenue or earnings? Do they just write it off? I would guess earnings in the low .70's. Brian