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Thu, Aug 21, 2008 - 04:51 AM EDT  —  AAPL: 175.84 (+2.31, +1.33%)  |  NASDAQ: 2389.08 (+4.72, +0.2%)

Beleaguered Creative Technology circles the bowl
Tuesday, May 02, 2006 - 01:27 PM EDT

"Singapore's Creative Technology Ltd., whose Nomad and Zen MP3 players compete with Apple's iPod, probably swung to a quarterly loss, hit by tough competition, falling prices and inventory write-downs. Creative is likely to stay in the red in coming quarters and suffer a weaker balance sheet as it grapples with excess stockpiles and intensifying price competition in the digital music player market, which is dominated by Apple Computer Inc.," Jennifer Tan reports for Reuters in the hilariously headlined article "Apple-rival Creative seen swinging to Q3 loss" (Creative rivals Apple as a 3.5 oz Snack Pack chocolate pudding rivals a 30-ton Sherman tank).

Tan reports that CIMB-GK Securities analyst Jonathan Ng said, "We remain negative on its prospects given the harsh competition in the market and a lack of new winning products in the foreseeable future."

"Creative is expected to report on Wednesday that it has swung to a net loss of about US$90 million for the three months ended March 31, its fiscal third quarter, a poll of five analysts by Reuters showed. This compares with a profit of $1.1 million a year ago, excluding a one-off $14.8 million investment gain, and a $1.3 million profit in the December quarter. While Creative struggles, Apple last month posted a 41 percent jump in quarterly profit that beat Wall Street forecasts, and said sales of its iconic iPod player topped 8.5 million," Tan reports. "'With two-thirds of revenue derived from the highly volatile personal digital entertainment segment, we anticipate Creative will need to take further restructuring charges to right-size its operations,' said Macquarie Research analyst Patrick Yau. The company's net debt position will also worsen in the coming quarters, as its aggressive marketing spending and rising working capital needs eat into its cash balance, Citigroup Research analyst Pratik Gupta said."

Full article here.

MacDailyNews Take: Won't be long now.

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Related articles:
Beleaguered Creative Technology reports largest operating loss in at least five years - April 10, 2006
Joke of the Day: Red Herring headline: 'Creative may be iPod threat' - February 28, 2006
S&P Equity downgrades Creative Technology, cites 'increased competition from Apple Computer' - February 14, 2006
Apple unveils new 1GB iPod nano for $149; iPod shuffle now starting at just $69 - February 07, 2006
Beleaguered Creative reports 95-percent slump in quarterly profit - January 26, 2006
Don't call them podcasts! Derivative, er, Creative introduces ZenCast app for 'audio & video blogs' - January 04, 2006
Creative's Zen Vision:M green with Apple iPod envy - December 09, 2005
Apple faces prospect of bruising iPod patent dispute from Creative Technology - December 09, 2005
Creative Technology's official press relase for Zen Vision:M Apple iPod knockoff - December 08, 2005
Creative's Sim Wong Hoo vows to 'aggressively pursue' Apple over iPod patent - December 08, 2005
Creative announces 30GB Zen Vision:M video-enabled 'iPod killer' - December 07, 2005
Beleaguered Creative waves white flag, surrenders self-declared MP3 player war to Apple iPod - November 07, 2005
Beleaguered Creative shifts promotional efforts from music players to new sound card line - September 21, 2005
Apple debuts iPod nano, iTunes 5: how are Microsoft, Napster, Real, Creative, Sony feeling today? - September 08, 2005
Creative explores new way to beat Apple iPod: patent litigation - August 30, 2005
Creative plans 'very vigorous defense' of iPod navigation patent - August 31, 2005
Beleaguered Creative Technology's 'war' on Apple iPod not faring well - August 15, 2005
Apple's iPod shine dims beleaguered Creative Technology's outlook - August 08, 2005
Microsoft not buying stake in Creative Technology - August 02, 2005
Creative CEO Sim Wong Hoo adds fronts to war against Apple iPod - August 01, 2005
Analyst: Microsoft could buy Creative Technlogy in bid to compete with Apple iPod - July 14, 2005
Beleaguered Creative CEO Sim Wong Hoo 'optimistic' the company will survive 'MP3 war' - July 01, 2005
Beleaguered Creative may have to write off unsold stock as losses loom - June 28, 2005
Creative Tech's reduced outlook drags on Apple, PortalPlayer, SigmaTel - June 27, 2005
Creative Tech cuts sales outlook, drags Apple down in early trading - June 27, 2005
Apple passed 20 million iPods sold milestone in early June - June 24, 2005
Apple's understanding of what really counts makes iPod+iTunes impossible to beat - June 22, 2005
Creative Technology shares slide to lowest mark in almost two years - May 18, 2005
Apple squeezes and Creative's profit plunges 72-percent - April 23, 2005
Apple iPod pressure forces Creative to drop prices on music players - March 01, 2005
Creative's self-declared 'MP3 player war' against Apple isn't going very well - January 20, 2005
Creative CEO: Apple iPod shuffle 'a big let-down, worse than the cheapest Chinese player' - January 12, 2005
Creative declares 'war' on Apple iPod, shoots for 40% market share of MP3 players - December 21, 2004
Creative Technology declares 'MP3 War' against market-dominating Apple iPod - November 17, 2004
Mossberg: Dell, Rio, Creative 'iPod mini killers' lag badly behind Apple iPod mini - October 27, 2004
Creative pushes to become 'Pepsi' to Apple's 'Coke' in digital music player market - August 07, 2004

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Reader Feedback: ( = registered)

May 02, 06 - 02:49 pm Comment from: Ampar

"Beleaguered Creative Technology circles the bowl."

Soon they'll be less of a drain and looking less flushed and tanked with exhaustion. So really, they should just pipe down and put a lid on it.

May 02, 06 - 02:50 pm Comment from: me

Piggy backing off teh AAPL being worth more than DELL story today...

AAPL is worth well more than 100 x CREAF's market cap ($60B vs. $526M)

May 02, 06 - 02:50 pm Comment from: Super Tim

Punks. I'd bash them if they were here right now. Creative stuff just isn't very good.

May 02, 06 - 02:51 pm Comment from: Too Hot!

Apple should buy Creative and put it out of its misery. That would give Apple the extra real estate and manpower for a Singapore plant, distribution channels in the far East, and a way of getting all those with current Creative hardware to switch to iPods.

May 02, 06 - 02:54 pm Comment from: Youlli

...getting all those with current Creative hardware to switch to iPods.

All three of them? Should Apple dare to dream so wildly?

Apple sells more iPods every 6 weeks than Creative sold all last year.

May 02, 06 - 02:54 pm Comment from: Waz

"(Creative rivals Apple as a 3.5 oz Snack Pack chocolate pudding rivals a 30-ton Sherman tank)."

That's hilarious....

May 02, 06 - 02:58 pm Comment from: rasterbator

Bugle playing Taps -- Insert Here

May 02, 06 - 02:58 pm Comment from: Jim - the independent voter

"(Creative rivals Apple as a 3.5 oz Snack Pack chocolate pudding rivals a 30-ton Sherman tank)."

or the way that apple rivals microsoft in pc market share...

but... "the times, they are a changin..."

May 02, 06 - 02:58 pm Comment from: The Shepherd Spy

Cheerio, cheerio, cheerio - as football fans are wont to chant in this country !

May 02, 06 - 02:58 pm Comment from: Professor Bunson Honeydew

You don't know the history of Creative's MP3 players; I do.

I love this motif.


Anywho.


I wish MDN would not allow comment posts on non mac related articles. I mean i know this is market and competition related. But come one people, this is rat's ass material here. this is inevitable, the downword spiral of any iPod competitor.

Can't we at least revive some newton scrap from the bottom of the barrel?

I may have flunked spelling, but i'm still the professor!

May 02, 06 - 02:59 pm Comment from: jackspratt

best...headline...EVER!!!!!!!

May 02, 06 - 03:01 pm Comment from: Tom Cruise

Hey Professor - Don't step on my material BITCH> Get your own M.O. for your crappy comments.

May 02, 06 - 03:01 pm Comment from: 3rdKidney

"Apple should buy Creative and put it out of its misery."

Why pay for it when you can get it for free? Apple just needs to wait another quater or so and they'll get all of Creative, it's user base, its employees even, without spending an additional dime.

Heck, if Apple opened a plant there now, I think half of Creative's work force would come running.

May 02, 06 - 03:01 pm Comment from: Al Jazzoo

FSCKING GOOD!!

Those basterds through 3DLabs (they own it) have for years refused to make a Mac version of their powerful video cards.

The moderators and even the company staf would laugh if a Mac user suggested or asked.

I hope the company goes bankrupt and Apple buys 3DLabs.

May 02, 06 - 03:02 pm Comment from: Too Hot!

@ Youlli:
Correct you are. But remember that iTMS is not everywhere. It is in some countries and not ALL countries. Where iTMS doesn't exist, iPods have a much smaller market share than in places like the US and Europe. Creative isn't the only one out there in these places, but it IS there.
If Apple grabbed that market, that would lead to a greater degree of world domination from a "geographic" point of view.

hmm, did I just type "world domination"?, got to think about that. grin

May 02, 06 - 03:03 pm Comment from: Professor Bunson Honeydew

You don't know the history of my crappy comments; I do!

May 02, 06 - 03:03 pm Comment from: me

Will CREAF even make it to the Christmas quarter?

I mean, if you look at the financials, their profit margin is just _below_ zero, their operating margin is -2.5%, they have a forward P/E of 37 - about the same as Apple's, but they have a miniscula market share, even smaller _mind share_ in the eyes of the consumer, they don't control the content (Napster, et al).

Which makes me think they need to take their $200M in cash and go back to whatever earned them that money.

May 02, 06 - 03:03 pm Comment from: Mike K

"excluding a one-off $14.8 million investment gain"

---------------

That one-off investment gain must be the AAPL shares that Woo purchased.

May 02, 06 - 03:05 pm Comment from: G-ZUS

Down the toilet bowl with you, unCreative Technology!!

http://www.sissel.cc/blog/bloglet.html

May 02, 06 - 03:15 pm Comment from: Hope Floats

For a season

May 02, 06 - 03:16 pm Comment from: Al Jazzoo

...circles the bowl

I guess this is the "toilet bowl humor" so frequently complained around here.

POTTY MOUTH

*fart* "Oh Terrance you shouldn't have, you sweet thing"

Hahahahah

*fart*

HAHAHAHAHA

May 02, 06 - 03:19 pm Comment from: Tom Cruise

I am serious Professor. Your plagerism does not fly here.

May 02, 06 - 03:20 pm Comment from: rasterbator

Just FYI — to all who post here: Tom Cruise is my alter ego on MacDaily News. I have been posting Tom Cruise comments for a while now, but the bad professor thinks he can just steal my material. For shame.

May 02, 06 - 03:30 pm Comment from: Jooop

You don't know the history of stepping on Tom Cruise's material.

I do.

Hail Xenu!

May 02, 06 - 03:32 pm Comment from: Cirie

Raster, didn't you steal that material from Tom Cruise's interview with Matt Lauer? ("You don't know the history of psychiatry. I do.") What, you get bonus points for stealing it first?

Pot, meet kettle.

May 02, 06 - 03:32 pm Comment from: Professor Bunson Honeydew

Can I have an Amen?

May 02, 06 - 03:34 pm Comment from: Al Jazzoo

Just FYI — to all who post here: Tom Cruise is my alter ego on MacDaily News

Are you sure your not MacDude too?

Hehehehe

May 02, 06 - 03:41 pm Comment from: s

"Apple should buy Creative and put it out of its misery."

Buying Creative do not make sense for Apple, since Apple outsources manufacturing. May be Creative should get smart and try to compete for the iPod contract instead. If they succeed in getting the iPod contract their stock will soar.

May 02, 06 - 03:45 pm Comment from: Professor Bunson Honeydew

Please send me email if you support me.

May 02, 06 - 03:45 pm Comment from: LordRobin

From the "related articles": Creative pushes to become 'Pepsi' to Apple's 'Coke' in digital music player market

Hee! Creative will be lucky to be Lotsa Pop!

I know it's childish to feel glee at someone else's misfortune, but I just can't help it! Creative got way more attention than they deserved with their uninspired iPod ripoffs, and propped up Windows-only music services.

May 02, 06 - 03:48 pm Comment from: rasterbator

I guess that is the sincerest form of flattery. Go ahead and post as Tom Cruise all you want, Bunsonhead. Since I did it first in this space, and you have spoiled it, it is not longer funny.

May 02, 06 - 03:50 pm Comment from: DLMeyer

I bought something from Creative ... once. This was pre-OS X and I was trying to get an older PC up to snuff so I could run Linux on it. Needed a sound card and theirs was in the remaindered bin. Worked just fine, too. Not that I was expecting much ... just something that had a driver available and a modest sticker.

Ya want history? I'll give ya history!

May 02, 06 - 03:53 pm Comment from: Jerry Seinfeld

So what is with that Zen thing anyway?

<ba-do-do-do-do. Pop. Pop.>

May 02, 06 - 03:54 pm Comment from: Ampar

Professor: You don't know the history of rasterbator's vengeance. I do.

Hey, that IS fun!

tongue wink

MW: out, as in "damn spot!"

May 02, 06 - 03:56 pm Comment from: Professor Bunson Honeydew

wow i've just been bent over. Someone posting as Professor Bunson Honeydew.

Someone is having a temper-tantrum.


I never used someone elses posting name - that's low

May 02, 06 - 03:58 pm Comment from: Professor Bunson Honeydew

You don't know the history of getting bent over; rasterbator does!

May 02, 06 - 03:58 pm Comment from: rasterbator

Nice one, Ampar. I am sure Bunson will go after you next and start posting your comments in other boards.

Whatever, Bunson. I am moving on since you're really not worth the effort.

May 02, 06 - 04:02 pm Comment from: rasterbator

Prof. Bunson: I can no longer post in regard to this matter. I don't want the internet police to think I am chatting with a 12 year old.

It was all in good fun, but apparently you really do suck.

May 02, 06 - 04:08 pm Comment from: Professor Bunson Honeydew

You don't know the history of Sucking . . . Oh wait . . . .Yeah . . . You do!

May 02, 06 - 04:10 pm Comment from: Professor Bunson Honeydew

aaaaannnnnnnndddddddddd . . . . i'mdone!

May 02, 06 - 04:17 pm Comment from: Jim Henson

Excuse me, Professor Bunson Honeydew, but what is this about someone stealing your posting name?

The REAL Dr. Bunson Honeydew
http://muppet.wikia.com/wiki/Dr._Bunsen_Honeydew

May 02, 06 - 04:23 pm Comment from: Beaker

Meep! Sadly temporary.

May 02, 06 - 04:26 pm Comment from: Billy Bob

Professor Bunson Honeydew,

I just tried emailing you at takeitinthebutt@assbag.combut it was just sent back. Why?

May 02, 06 - 04:29 pm Comment from: Professor Bunson Honeydew

but . . . . well . . . . ugh . . . . . er . . ..

He's Dr. BunsEn Honeydew.

I'm Professor BunsOn Honeydew. That is 180˚ different.


But seriously . . . . if you saw my iChat icon, you'd be pissed!

May 02, 06 - 04:31 pm Comment from: Beaker

Honeydew used to sodomize me.

May 02, 06 - 04:47 pm Comment from: Jim Henson

Actually, I fisted all of my muppets again and again.

May 02, 06 - 05:51 pm Comment from: hammer

"Hey Professor - Don't step on my material BITCH> Get your own M.O. for your crappy comments."

Hey, you don't know the history of stepping on your material, I do.

May 02, 06 - 06:24 pm Comment from: R

...uh... on a serious note--

Anyone think they're going to change their business model and downsize bigtime? They have to have soimething profitable still, I would imagine. Soundcards, right?

It makes me wonder-- if iPods end up being the only real players out there, except for Sandisks maybe, do people think Apple will stagnate like lots of other successful companies (M$, Sony). I don't. In fact, I think they would show businesses a thing or two about remaining really creative and not getting fat off success.

May 02, 06 - 06:41 pm Comment from: Wrong Again

I've felt for some time that Creative had an opportunity to become a top rate producer of iPod accessories (may even beat Belkin and the others to market with an iPod mike) if they had seen the handwriting on the wall long ago.

They could still pull this rabbit out of their hat, but not sure if they've got the money left to commit to product-awareness-building.

May 02, 06 - 09:00 pm Comment from: CoS

Every post Tom Cruise has made on MDN is the intellectual property of the Church of Scientology. All people using his material will be prosecuted to the fullest exent of the celestial law.

Why did you guys have to ruin it? I liked Tom's M.O.

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