Thursday, January 26, 2006

After the Close: Softee Reports

Mr. Softee just reported another tepid quarter after a shortage of XBox shipments sent rabid analysts fleeing back to their Excel spreadsheets in a stupor.

Why, Softee, why?

We're not concerned. Microsoft (MSFT) is a bellwether -- no one expects it to rip the cover off the ball quarter after quarter -- leave that to the under 30 crowd at Google (GOOG).

Bellwether followers expect only one thing: Stability. Cash. A fat dividend. Maturity.

And Microsoft delivered.

An XBox capacity constraint isn't going to have us pulling out our hair. In fact, what Softee had to say was positive, even if it wasn't music to the Street's ears:
...Demand for Xbox 360 consoles has been extremely strong and the feedback on the platform has been incredibly positive. Our biggest challenge in the quarter was meeting the high consumer demand for the console. We saw 1.5 million Xbox 360 consoles in the second quarter. With 900,000 console in North America, 500,000 consoles in Europe and the remainder in Japan. This was lower than what we expected due to component charges tell me from challenges and ramping supply of accomplished product of Xbox 360. But we believe that this is a short-term manufacturing challenge and that we’ve taken steps to increase supply, to meet the strong consumer demand for the console...via SeekingAlpha
Analysts expect that demand for the console will probably outstrip supply for the next two quarters. And let's not forget that the release of Windows Vista is right around the corner.

Vista better come, because the Microsoft waiting game is slowly beginning to feel like an early Hitchcock film.

Any more suspense, and investors could turn this tedious drama into a horror B-flick.

About Us | In the News | Management | Contact Us | Archive | Premium Membership | Terms of Use | Privacy Policy | Careers | FAQ

All quotes are 15 minutes delayed. Copyright © 2006 by Catablast! Media Group LLC, part of the SeekingAlpha network. Web Design by Synexio Systems. All Rights Reserved.