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Dolby Laboratories, Inc. Message Board

  • from_a_remote_desert from_a_remote_desert Feb 4, 2009 7:34 AM Flag

    Now Panasonic reports low sales

    http://biz.yahoo.com/ap/090204/as_japan_earns_panasonic.html

    "Sales slid in a wide range of products, including flat-panel TVs, DVD recorders..."

    At best DLB Q2 outlook will be bleak. I'll start buying at $22

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    • One company sales will not make or break Dolby.

    • Oops one more thing. If you read the WSJ version of that Panasonic low sales article, it talks about how Japanese manufacturers are facing increased competitiveness with their Korean rivals. The yen has appreciated 16% against the dollar over the past year while the won has depreciated 50%. At the end of the day, unit sales overall for everyone may be down but its not that big of a jump to get that at least some of the lost sales from Japan is going to Korean or American (gasp, buy American?) or <insert x country here> consumer electronics firms which can partially offset lost royalties from Japan.

      I'm a realist here, I'm not thinking everything is rosy and you may be correct when you say Dolby's outlook won't be good. I'm just objecting to the incomplete picture/analysis and the way you are coming to your conclusions.

      And let's keep things in context here, Dolby ended their first day of public trading at a price near where we are at, so good luck with that 22 although you may get it. Even with the downturn, surely the company has grown a lot since then.

    • Please stop posting only about one or two consumer electronics manufacturers which are conveniently located in JAPAN and trying to use that to lump the entire worldwide consumer electronics industry as a whole. Sony, Panasonic and Toshiba are all experiencing major downturns in profits largely due to the strong yen. See: http://news.bbc.co.uk/1/hi/business/7857474.stm
      You'll love the title of that article.

      During this time, the global competitors of these Japanese companies intend to take advantage of the strong yen and increase market share. See: http://gadgets.tmcnet.com/topics/gadgets/articles/48398-lge-eyes-50-percent-jump-lcd-tv-sales.htm Whether you buy a TV made in Japan or the cheaper one made in Korea, the unit royalty is going to be the same if it has Dolby technology. So a decline in unit sales from Japanese manufacturers can be offset by competitors who are taking market share. Painting a limited picture by only posting about Japanese companies is silly. It is actually a very complex global picture that you need to look at and it isn't necessarily revenues or profits of a licensee or even the entire industry that matters. Its GLOBAL UNITS SOLD since Dolby charges licensing fees on each unit sold with its technology. Can industry revenues be down while unit sales are up? Yes, and this has happened in 2006 see http://seekingalpha.com/article/22984-lcd-revenues-down-in-2006-despite-unit-sales-being-up-29 I'm not saying this is what is happening here, I'm only pointing out that your oversimplification of this entire issue (pointing to revenues and profits of a few firms located in Japan and concluding Dolby is hosed) just shows your lack of understanding. Dolby has thousands of licensees so instead of cherry picking the ones from countries that are obviously disadvantaged and using that to determine anything is silly.

      Yes, no company is immune from the global downturn in consumer spending and the effects of this global recession but Dolby already has projected earnings DOWN for this year. They are predicting negative growth. So keep that in mind, when you come to your own conclusions about an impending miss.

 
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