SCRI International – Avid Downward Trend Continues

[Richard Cardonna]

Last I heard Avid is trying to work something out with Fusion. But I think its to late. Avid is going to think about DS also. Maybe a new tear a combination of Symphony/DS with Fusion.

Also Software based media management is far less expensive and more flexible than most of what avid has. Couple this with off the shelf hardware. So I think most of Avid hardware is on the verge of becomming bloteware if not obsolete.

Of course their market is swiftly becoming a niche in a niche.

RCardonna

[Franz Bieberkopf]

Craig,

I have to say that the sources you focus on seem pretty vague and speculative. [Andrew Richards] seems to have found much more revealing information. https://forums.creativecow.net/readpost/335/30956

Also, I am surprised this was never posted, two months back (though it is mentioned in your linked articles):

https://www.forbes.com/sites/ericsavitz/2012/02/07/avid-crushes-q4-estimates-first-gaap-profit-in-5-years/

I would think that those profits were the result of all that activity you were referring to last fall – fallout from X. That isn’t to gloss over the recent numbers, but I don’t really see any insight in the “analysts” you’ve quoted. (ie why things looked good then and don’t look good just two months later).

[Craig Seeman] FCPX is having a negative impact on Avid’s consumer products (please let’s not get into pro v consumer).

Don’t your 3 lengthy quotes rest entirely on such a distinction?

Franz.

[Craig Seeman]

I mentioned that while the numbers don’t look good, I’m not sure the “creative enthusiasts” reasoning is accurate.

The comparisons are normally current quarter compared to last year’s matching quarter to account for possible seasonal change. That would mean Q4 2011 will be compared to Q4 2012. Alternately they’ll be a year over year comparison which again won’t have till Q4 2012 . . . or if we can find 2010 to 2011 comparison.

It would be a concern that Q1 2012 is not as good as Q1 2011 since it may indicate the Q4 2011 upswing did not sustain relative to the pattern.

We probably need to look at something like Q4 2010 to Q1 2012 to see a clearer picture.
In any case it looks like the uptick was just that one Q (so far).

[Franz Bieberkopf]

Craig,

I’ll be honest, I don’t follow this stuff as closely as you seem to, but Q4 2011 was remarkable for profit (the first in 5 years), not relative comparisons of any sort.

From the Forbes link:

Avid posted a GAAP profit of $1.2 million or 3 cents a share – the company’s first GAAP profit since 2007. The company noted that gross margin reached the highest level since 2005.

Franz.

[Craig Seeman]

Basically I’d like to see 2011 compared to 2012 once this year is complete. That will indicate whether it was a one time bump vs a trend. My concern is that Q1 2012 may not be better than Q1 2011 which may not be a good sign that it was anything other than a bump. In other words, typical comparison are in matching quarter Q4 2011v Q4 2012 or all 2011 v all 2012. While adjacent quarters are certainly interesting (and Q4 2011 to Q1 2012 is NOT good since the profit didn’t sustain) matching quarters or year over year tend to be better indicators.

BTW if you’re into following Video Industry financials, SCRI is good for that. The summaries are free (reports are expensive).