Directed Lowers 2006 Guidance Due to Satellite Sales
Wednesday, December 6, 2006 at 8:13 AM
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Directed Electronics is revising their 2006 guidance to reflect lower than anticipated satellite radio sales. Directed's sales are now projected to be in the range of $430 - $440 million compared to previously issued guidance of $440 - $460 million.
Jim Minarik, President and CEO, said in a statement, "We are revising our guidance based on lower-than-expected sales of satellite radio receivers. While several key weeks remain in the holiday shopping season, satellite radio receiver sales have not been as robust as expected. We believe that it is prudent to take a conservative outlook in our sales and earnings expectations for 2006, which still reflects a 41% - 45% increase in sales and a 60% - 67% increase in pro forma net income over 2005."
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Comments
Not good for the sat radio industry. While the XM and Sirius fanboys may enjoy the news that the other service may not hit year end guidance, it's bad for the sat radio industry. Whether you are an XM or Sirius fan (or both!), you have to hope that both companies surprise us all and hit their targets.
Posted by: iband | December 6, 2006 8:33 AM
This is news that is specifically negative to Sirius. While this is likely an indication of the industry as a whole, I can still hope that it is not and XM will still hit or surpasses its target for Year End 2006. Just because you are a fan of the industry, you don't have to praise both companies... especially when they are at each other's throats.
Posted by: Chipper ? | December 6, 2006 11:00 AM
Not hitting a target isn't necessariliy a sign of poor health, just a sign of unrealistic expectations. Sirius and its allies seem to have more or less bathed in the Kool-Aid that Stern would be some sort of ever-growing publicity avalanche. Last year's arrival was their big coup; how could they think they'd outdo themselves the next year?
I think Sirius has been intentionally irrational in its guidance this year. XM, dealing with a disgruntled investor lawsuit already, decided to be conservative in its estimates and (hopefully) beat expectations later. Sirius saw an opening and hoped that being the "good news" company would make it the default brand for investors and consumers. Now it's time to pay the piper.
Posted by: Andy | December 6, 2006 11:27 AM
I am not convinced that the stiletto has been widely available....I for one want to purchase one, however, all that has been available is the model with more storage at ~ $350. The lessor model, at ~$250, has not been available that I have found. I'm not sure what the malfunction is with XM and Sirius distribution, but they both always seem to be delayed or in short supply in the ever-critical holiday season.
Posted by: John | December 6, 2006 12:51 PM
The Stiletto 100 (The 350 one referred to by John) is available and I have seen displays in all the major electronic retailers in my area. The Stiletto 10 (250 one) was just recently released and as such was not available for you to buy. The shortages for both companies usually involve FCC issues, blame them.
Posted by: History Guy ? | December 6, 2006 3:38 PM