Audiovox told Wall Street analysts Wednesday that it was disappointed that Qualcomm decided to suspend the FLO TV subscription TV service.
“We are firm believers in FLO TV and its market potential,” said Audiovox president and CEO Pat Lavelle. “Long term, Audiovox believes the time is right in the aftermarket for a pay TV service.” And he added that Mobile DTV (ATSC m/h) should replace these sales as it rolls out during Audiovox’s fiscal 2012, which starts in March 2012.
In case you are worried about a big loss for Audiovox from FLO TV’s exit, don’t. Lavelle said, “We will work with Qualcomm to transition out of this business,” with no financial impact to Audiovox.
In a conference call, Audiovox also reported strong sales in mobile electronics for the period ending August 31, with a gain of 56 percent in sales compared to the year earlier. The company’s purchase of Invision plus increasing new car sales accounted for the boon. Lavelle also said the remote start season was off to a strong start.
At the Consumer Electronics Show in January, Audiovox will introduce 14 “OE look” factory replacement AV radios with HD Radio, satellite radio, iPod control and built in navigation.
Audiovox’s OEM sales for its fiscal Q2 “were up over $20 million– a triple digit increase over last year,” said Lavelle. “And while Invision was certainly a key contributor, we saw significant increases in all OE groups and categories made possible by the uptick in domestic car sales and new programs…”
Also there’s renewed interest in SUV sales, which bodes well for Audiovox as these are prime vehicles for back seat entertainment products. U.S. light vehicle sales have reached a seasonally adjusted annual rate of 12.2 million units, Lavelle said.
For Audiovox’s fiscal Q2, overall the company posted slightly higher sales but a lower net income of $0.6 million compared to $2.8 million for the quarter last year. The shortfall was attributed to lower consumer spending and slower sales of accessories as demand for HDTV antennae fell compared to last year (when the HDTV transition took place).
Photo: Pat Lavelle via Newsday