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Re: Carrot officially deployed

By: DigSpace in ALEA | Recommend this post (0)
Wed, 20 Jun 12 8:38 PM | 78 view(s)
Boardmark this board | The Trust Matrix 		Msg. 08508 of 54959
(This msg. is a reply to 08507 by Cactus Flower)
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I agree, what I am trying to do is define "genuine strength".

I think we both appreciate more-better-happy-good, but i suspect that busting out some calipers every once in a while is ok too.

It seems to me, even after culling BASF, GM and friends from Q4 to Q1, another $1m went up in smoke.

I think the smoke is ERAS has been generally over interpreted, and that Dell core revs has been under interpreted, and that the NewDellDeal was much more catastrophic than and wetness in Thailand can hope to explain.

Given that, I think the Q1 numbers have to be treated as the new baseline, not as a blip, but as the reality of shaving 25 cents off Dell royalties. It indicates that Wave is and only has been because of the Dell deal. This was not well planed for, forecast, notified, or handled. Patently botched. Tack n some SFND non-cash items and it makes for some miserable looking books (not that I do books or anything, but I don't think I need to be a professional in this instance).

So given that, given it is not just some SMB weakness, that a serious erosion of Dell royalties underpins Q1 ....

what defines "genuine strength"?

Services were about 0.3 in Q1, leaving the $6.6m as the base, and I am reading BASF as mostly/essentially recognized in 2012 as they have been saying in their various reports.

So, of the $6.6m about $0.6m is BP and maintenance.

Thy did about $6m in business in Q1. Somewhere I think that is what they claimed in new billings as well.

So, what is "genuine strength" off that?

5%, 10%, 15%, 20%, 30% ????

As Q1 had 324k in services (this is where the samsung numbers are getting buried) I'm expecting that to move towards say 500k (the Army Sole etc). That's peanuts.

It the past Wave has observed QtoQ results that when the rest is stripped out seems like the best they have done is around 13%. So, is 15% "genuine strength"?

20% growth to me drops out as Q2 revs of $8.3m (600k BP+other maint, 500k services, 20% growth on 6m base).

So, is a reported 8.3m revs for Q2 "genuine strength"??


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The above is a reply to the following message:
Re: Carrot officially deployed
By: Cactus Flower in ALEA
Wed, 20 Jun 12 8:18 PM 		Msg. 08507 of 54959

Hi Dig,

the worst thing about q1 was that it represented the total failure of the revenue maximising strategy.

you can't do that model without cash front running recognition, unless you have a fat cash balance to begin with. and of course, they dropped the ball on dilution when they still retained the credibility of their strategy.

they had a year to produce the major contracts to replace GM, so blaming Thailand is lame. they also has a much larger sales force with which to deliver those sales.

the problem is that they have now broken investor faith in the growth of income in the eras market. feeney had somehow managed to present the numbers to give the appearance of steady growth. but that definitively failed in q1. not his fault. the lack of sales/demand follow-through post-gm was striking.

now they have to prove q1 was an isolated instance, so it is critical that q2 isn't simply a small step back up, but that it shows genuine strength.

although wave has tried to provide some substance, i am afraid i think they have deliberately allowed flexibility so that they can explain away failure as delay. i am really interested in concrete expectations delivered in the form of q2, q3 and q4 revenue guidance. if they won't offer it, i remain sceptical about the timeline and hence the reliability of wave's prognosis.

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