Post by
hedge8 on Oct 28, 2015 6:16pm
Registered users misses my estimate, but...
I had estimated 33,000-38,000 registed users by the end of Q1. Actual users came in at 31,414. I am not too impressed by that number. It is surprising that with the number of LG 3DTVs out there Sensio hasn't been able to penetrate further.
The "but" is that Q1 is seasonally the slowest quarter of the entire year, both for rentals and for TV sales. This is important to remember, as we know that the vast majority of new 3DGO users are driven by new 3DTV sales, and the vast majority of rentals revenues are driven by quality new 3D releases. To give you some perspective, here's a list of new releases during the last quarter vs. the current quarter:
Q1: (Jun15-Aug15)
Spongebob Movie (Jun 2)
Home (Jul 28)
Q2: (Sep15-Nov15)
Poltergeist (Sep 29)
Avengers Age of Ultron (Oct 2)
Jurassic World (Oct 20)
Inside Out (Nov 3)
Terminator Genisys (Nov 10)
In previous posts I said I was cautiously optimistic about Q1, as it should provide a hint of the LG impact, but that the real growth will not be seen until Q2 and Q3. I am disappointed with the impact of LG so far, but given that the current quarter has more than 2x the number of new relases vs. Q1 I remain confident that that alone should result in twice the number of rentals. Factor in Samsung and Black Friday and 3DGO revenues in Q2 are likely 3x what they were in Q1.
Sensio already said in today's PR that with more than a full month still to go in Q2 revenues are already more than Q4 2014 and 2015. That means revenues are already greater than $30,000 so far. I'll assume they are $35,000 so far (vs. $31,814 in all of Q1). That likely came mostly in October and mostly from Avengers alone. With Jurassic World, Inside Out and Terminator being released over the next 2 weeks you can likely double that to $70,000 even without the Black Friday effect. With a spike in Black Friday sales, and LG and Samsung both fully launched, that probably means $80,000-90,000 3DGO revenues in Q2. With Christmas and more big releases in Q3 3DGO revenues should be in the $125,000-175,000 area in Q3.
Not Netflix numbers by any means. And still a long way to go (international expansion will definitely help). But the posters bashing Q2 earnings are the same ones that were bashing Q1 for similar reasons at .10 and watched the stock jump almost 100% this month. These posters continue to focus on the past and not on what is now the present in Q2 and the very near future in Q3. The share price may sell off a bit tomorrow for similar reasons as it did in Q1, by investors focusing on the past and a seasonally weak quarter, but Sensio is building a critical mass and results will be seen in Q2 and Q3.
The negatives? As I've already posted on numerous occasions, SIO will need one more infusion of cash. That will likely result in 10-15% dilution in shares. If they can find a way to execute this efficiently I can live with it. And, as I mentioned above, I am disappointed with SIO's ability to penetrate existing LG 3DTV owners. I am confident with their ability to grow users from new 3DTV buyers, but they really need to find a way to market the product better to existing TV owners.
I 100% disagree with the resident basher (and most of us know who he is and why he is bashing) that there is no market for 3D at home. Almost all of the negatives that hurt 3D at home during its launch several years ago are addressed with things like passive 3DTV, UHD TVS and 3DGO. It takes time to reverse negative perceptions, but as more and more users use 3DGO we'll continue to see that market grow.