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Sony loses $563 million in latest quarter

Brian White — Thu, 17 May 2007 11:34:00 EST

Filed under: Earnings Reports, Bad News, Wal-Mart (WMT), Sony Corp ADR (SNE)

The news continues to not look good for Sony Corp. (NYSE: SNE).Sony's quarterly loss of $563 million was announced yesterday, and the consumer electronics giant cited PlayStation 3 development costs and under-performing sales as the triggers for such a dismal fourth quarter. Sir Howard Stringer may be pulling his hair out about now, if any is left. Perhaps that's a toupee he's been wearing all these years, eh?

Sony stated that it had shipped 5.5 million PlayStation 3 gaming consoles for its last fiscal year (below the internal goal of 6 million unit shipments), and the company now expects to ship 11 million PlayStation 3 units by March of 2008. Is that enough to get things on track at Sony? Probably not. In addition to lackluster PlayStation 3 sales, the prices for the red-hot category of flat-panel televisions have taken a huge nosedive, something Sony pricing execs are probably stewing over in the shower before each day begins.

But, back to the PlayStation 3, the reported high-development costs and high retail price tag of the gaming system are all pieces of the puzzle that is keeping these units in short supply and not in the hands of gaming consumers, who seem to prefer the much cheaper Nintendo Wii ($250), which is much less advanced technologically than the PlayStation 3 but contains a far more immersive gaming experience for the consumer, according to critics. In other words, it's not the horsepower that counts here but the overall engagement with the consumer. This was lost on Sony apparently, as the PlayStation 3, for all its high-tech goodness, is being left behind by even the year-and-a-half old Microsoft (NASDAQ: MSFT) Xbox 360.

Sony loses $563 million in latest quarter originally appeared on BloggingStocks on Thu, 17 May 2007 11:34:00 EST. Please see our terms for use of feeds.

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Is Nintendo edging ahead in the current gaming console sales contest?

Brian White — Wed, 03 Jan 2007 14:44:00 EST

Filed under: Rumors, Products and Services, Launches, Consumer Experience, Competitive Strategy, Microsoft (MSFT), Marketing and Advertising, Sony Corp ADR (SNE)

The Sony Playstation 3 has been in short supply over the recent holiday season, and the Microsoft Xbox 360 has been selling fruitfully thanks to its edge of having a one-year head start, and the third contender in the current gaming console contest, the Nintendo Wii, showed a pretty strong holiday selling season according to preliminary estimates.

Now, follow me here as we look at the console prices:

Sony Playstation 3: $499 or $599
Microsoft Xbox 360: $299.99 or $399.99
Nintendo Wii: $249.99

That is quite a disparity in pricing. Although there are technical discussions and rationales about who has the better graphics, which platform is technically superior, and which console has the best game support, none of that matters a bit. What does matter is results. Even if the Sony Playstation 3 has the best "everything" it will flop if developers don't write games for it, and particularly if the furor wears off this year with the $500 and $600 price tag dragging it down. That leaves 2007 as the year of the gaming console -- and the year that someone will win the contest. Well, at least this round.

The Wii is the cheapest, but features a pretty immersive experience which requires physical movement (exercise and movement as entertainment, what a concept) is reportedly outselling the Sony and Microsoft consoles at the moment. I can see why. The console has such a unique niche (physical interaction with the content), design, and low price that it just seems like Nintendo may once again rule the crown of gaming consoles, at least for the moment (year). With the Xbox 360 way ahead in terms of sales right now -- with its year-long head start -- the end of 2007 will tell the tale of which console customer prefer.

[Disclosure: I own MSFT shares as of 1-3-06]

Is Nintendo edging ahead in the current gaming console sales contest? originally appeared on BloggingStocks on Wed, 03 Jan 2007 14:44:00 EST. Please see our terms for use of feeds.

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Best Buy and Circuit City strap on gloves for PS3 launch this Sunday

Brian White — Thu, 16 Nov 2006 16:45:00 EST

Filed under: Products and Services, Launches, Consumer Experience, Competitive Strategy, Best Buy (BBY), Circuit City Stores (CC)

With mega-retailers Best Buy and Circuit City strapping on the retail gloves for the launch of the Sony Playstation 3 this Sunday morning -- after a "real" launch tonight at midnight -- the two retailers will duke it out to see which chain will sell more of the new game console along with all the aside-purchases that each chain most likely wants to strap on the bill for that expensive new $500 or $600 gaming machine.

Best Buy stores -- so far -- are reportedly going to open at the normal time Sunday morning (let me know if you know about earlier times). With the Sony PS3 retailing for $500 and $600, that's quite a pinch in the wallets for a game playing machine, although Sony says the new machine is a quantum leap over anything that exists in the gaming console market at this time.

But the Nintendo Wii will only retail for $249 at launch -- half the price of the Sony PS3. Will the Sony unit be twice as good as the Nintendo unit? Are Sony shareholders waiting with baited breath for this new PS3 launch to tie any future fortunes to Sony on a single product launch? What about Microsoft's year-old xbox 360?

Talk about a crazy hazy year for holiday gaming consoles. I wonder if this one will go all 13 rounds -- and whether Best Buy or Circuit City will emerge as the overall victor of sales here.

Best Buy and Circuit City strap on gloves for PS3 launch this Sunday originally appeared on BloggingStocks on Thu, 16 Nov 2006 16:45:00 EST. Please see our terms for use of feeds.

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Cramer plays Activision for the holidays

Jon Ogg — Tue, 07 Nov 2006 19:10:00 EST

Filed under: Analyst Reports, Launches, Television, Microsoft (MSFT), Electronic Arts (ERTS), Activision Inc (ATVI)

Too focused on elections and their effect on the market this November 7th? Not Jim Cramer, who's already looking ahead with what he calls a "holiday play" that is good regardless of wins the polls. Cramer thinks that it's going to be an Activision, Inc. (NASDAQ:ATVI) Christmas. The video game company is #2 behind ERTS. The company's blowout numbers didn't affect the stock because they had already guided up. Think video games are too juvenile in which to invest? Then, says Cramer, think of them as long interactive movies.

This will be a big season for video game consoles, with Sony PS3 coming out November 17 and Nintendo's Wii out on November 19. And, don't leave out the Xbox 360 from Microsoft Corporation (NASDAQ:MSFT). He has recommended GameStop Corp. (NYSE:GME) much lower, but says ATVI is the play. Tomorrow ATVI releases "Call of Duty 3," and Cramer though this will be a huge driver and it is available for Xbox 360 and PS3. The "Guitar Hero" sequel just hit store shelves today, and the "Tony Hawk" game is also quite popular.

Never the buy-and-hold type, Cramer noted that buying ATVI is "risky investing" and you should remember to sell it going into the holidays. Cramer said even though he likes management, the company has a history of "lumpy quarters." He reminded investors to use limit orders and only buy later tomorrow.

He says this is a TRIPLE NO COAL IN YOUR STOCKING BUY.

Cramer plays Activision for the holidays originally appeared on BloggingStocks on Tue, 07 Nov 2006 19:10:00 EST. Please see our terms for use of feeds.

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Earnings preview on Electronic Arts

Jon Ogg — Thu, 02 Nov 2006 11:54:00 EST

Filed under: Earnings Reports, Forecasts

Electronic Arts (NASDAQ:ERTS) reports earnings today after the close of the market. Consensus estimates are $0.02 for EPS and $672.25 million in revenues. In August the company forecast a loss of -$0.22 to -$0.28 after items and a break-even result before items on revenues of $635 million to $685 million.

This will essentially be the second throw-away quarter for EA as the bulk of the business is centered around the fourth quarter and first quarter of the calendar. Its updated "Madden Football" game posted sales of more than $100 million its first week out of the chute in August.

So this is the throw-away quarter, and that is a given. Now what we have to worry about is the excessively wide range of estimates that exists for the coming quarter. The street is looking for approximately $0.57 EPS and $1.2 Billion, but the lower and higher ranges are apparently $0.40-0.72 and $1.15B to $1.3B. There is also a discrepancy of consensus estimates from service to service. That means that with the stock back up at the highs, you might have to still worry even if they guide slightly up from mid-points. The other worry is that the company has a history of reporting sporadic results and even more sporadic reactions in stock prices.

With the large Madden numbers you would expect that the revenues were attainable. But in this current quarter we get the release of the two new systems going after Xbox 360's lead. We have the Nintendo Wii and the Sony PS3 coming out within days of each other later this month. Both consoles have sold out as far as pre-orders at GameStop and indications seem to suggest some of the same at Best Buy. EA has roughly 30 games under development as of last month. This is actually the second quarter that JamDat has been a subsidiary of the company for mobile operations, so we may have a better grasp of the mobile gaming segment ahead.

Continue reading Earnings preview on Electronic Arts

Earnings preview on Electronic Arts originally appeared on BloggingStocks on Thu, 02 Nov 2006 11:54:00 EST. Please see our terms for use of feeds.

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Sony's PS3 hiccups good for Micrsosoft

Brian White — Thu, 12 Oct 2006 11:51:00 EST

Filed under: Products and Services, Launches, Consumer Experience, Internet, Competitive Strategy, Microsoft (MSFT)

Where in the world is the Sony Playstation 3? That is a question Microsoft execs probably don't care to have answered, since the most visible contender and competitor to the Sony PS3 is Microsoft's own Xbox 360, which was launched almost a full year ahead of the Sony PS3 in a rather marketing and manufacturing coup for Microsoft. Of course, the geek squad will most likely tear apart the PS3 and explain how much more radically advanced it is compared to the Microsoft Xbox 360, but the market will perceive that Microsoft was a year ahead of Sony.

GameStop, a large national retailer of video games and video game consoles, has stopped taking pre-orders for Sony's upcoming PS3 -- which makes me scratch my head a little. The obvious, one-question word is -- why? The same day the pre-order promotion began -- this past Tuesday -- is the same day it closed. Is that a possible technical snafu or did Sony shake the change out of GameStop's pockets?

Reuters reported on Tuesday that GameStop said it had sold out of its pre-order quota , which was perhaps the reason that the retailer quit taking in-store pre-orders the same day it started. GameStop said that each of its 3,600 stores had no less than eight and no more than 13 of the anticipated next-generation players available on pre-order. With an expected short supply of the Sony PS3 this holiday season, will demand shift towards the Xbox 360 to make up for the shortfall? The Xbox 360 also had a well-publicized inventory shortfall when it debuted, but that is apparently over with. It's Sony's turn now.

[Disclosure: I own MSFT shares as of 10-12-06]

Sony's PS3 hiccups good for Micrsosoft originally appeared on BloggingStocks on Thu, 12 Oct 2006 11:51:00 EST. Please see our terms for use of feeds.

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