What a bunch of BS... a summary:
Legal disclaimers, happy technophobe stories, rosy pictures painted ... "delighting the customer" ... "30% growth from referrals" ... "Reduce backlog by mid-summer" ... "Unexpected surge in demand" ... "Plenty of supply to fulfill any expectations" "Things are going very well" (Notice how they carefully word this... they have enough supply to meet "expectations" while not explicitly saying there's not enough to meet "demand")
Nearly $1.3 million revenue $632k subscription revenue, growth from 3,700-20,000 subscriptions. Sales from peripherals (high-margin mouse and printers) $659k. Order volume 70% from website and 1-800 number, 30% from "unexpected retail demand." (Would that be us?)
Due to "unexpected growth," a $41.7 million net loss... That's a $1,200 cost per new subscriber aquired! They are quite proud of this, as this was 16% lower than predicted. Expecting a "pretty rapid decline" in customer acquisition cost. Have plans to "rent" software (consumer ASP) on a monthly basis. (Another thought: at $21.95 a month, assuming it was all profit, it would take almost five years to break-even at the current acquisition cost.
Overall an $83.8 million loss after including an additional $48 million "non-cash" loss from stock options being exercised. An additional income of $133 million acquired by IPO.
Any questions?
Return rate is 13% Devices can be redeployed via a "refurbishment process"
Plenty of supply to meet "internal and external expectations" the only problem is "servicing demand" ... adding a second assembly line, new designs with TFT display, extending relationships with Sharp and Hitachi. "Were in great shape"
Adding Disney and eBay content as strategic partners.
No further questions...
Hackers, what hackers? No mention of any hacker-related redesign issues or costs... Of course, when each subscriber costs $1,200, we probably seem pretty insignificant.
An interesting exercise in corporate doublespeak...
