Don't Buy Rosetta Stone Until It Can Translate Cost Cuts Into Cash Flow
Rosetta Stone's Terminal Decline Continues Despite Acquisitions And Accounting Changes
Ian Bezek • 24 Comments
Ian Bezek • 24 Comments
Wed, May 4, 4:54 PM
Tue, May 3, 5:35 PM
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Mon, Mar. 14, 4:22 PM
Sun, Mar. 13, 5:35 PM
Nov. 5, 2015, 3:26 PM
- With the help of low expectations, Rosetta Stone (NYSE:RST) has jumped after soundly beating Q3 EPS estimates and missing on revenue. A 26% Y/Y drop in operating expenses to $17.5M - the result of Rosetta's decision to pare consumer product investments - boosted EPS.
- The language software vendor's 23% Y/Y revenue decline stems from a 42% drop in consumer revenue to $24.5M. Enterprise/education revenue rose 12% to $25.3M, aided by 103% growth for the Lexia reading software platform.
- The U.S. accounted for 82% of Q3 revenue. The deferred revenue balance has risen by $11.2M this year to $139.4M.
- Q3 results, PR
Nov. 4, 2015, 4:32 PM
- Rosetta Stone (NYSE:RST): Q3 EPS of -$0.34 beats by $0.27.
- Revenue of $49.8M (-22.8% Y/Y) misses by $1.8M.
Nov. 3, 2015, 5:35 PM
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Aug. 5, 2015, 4:12 PM
- Rosetta Stone (NYSE:RST): Q2 EPS of -$0.38 misses by $0.05.
- Revenue of $51.4M (-10.3% Y/Y) beats by $6.27M.
May 6, 2015, 4:16 PM
- Rosetta Stone (NYSE:RST): Q1 EPS of -$0.95 may not be comparable to consensus of -$0.69.
- Revenue of $58.45M (-3.8% Y/Y) beats by $14.37M.
Mar. 12, 2015, 10:22 AM
- Rosetta Stone (RST -12.9%) has nosedived after missing Q4 estimates and stating it's cutting its consumer product investments to focus on enterprise/education opportunities.
- On the CC (transcript), the company noted consumer bookings are expected to fall to $110M-$130M in 2015 from 2014's $196M, and will come in around ~$50M-$75M during the next few years. It also mentioned Q4 North American consumer bookings ($61.9M, +18% Y/Y) fell short of guidance of $64M-$69M, as price cuts dampened the impact of 34% unit growth.
Mar. 11, 2015, 5:00 PM
- Rosetta Stone (NYSE:RST) uses its Q4 report to state it's "refocusing its corporate strategy and realigning resources" around its Global Enterprise & Education (E&E) ops. It plans to "reduce global non-E&E headcount approximately 15%, resulting in annual expense reductions of approximately $50 million."
- The cost cuts will "target Consumer sales and marketing, Consumer product investment, and G&A costs." A $7M Q1 charge is expected, and an $18M Q4 non-cash impairment charge has been recorded. Chief product officer Nick Macey will now report to E&E chief Judy Verses, as will Rosetta's IT and business development teams.
- The language software vendor's North American and international consumer revenue both declined 11% Y/Y in Q4, respectively falling to $48M and $6.4M. Global E&E revenue rose 51% to $24.9M, thanks largely to acquisitions.
- Bookings rose 15% Y/Y to $96.6M (above revenue of $79.3M). Rosetta is guiding for 2015 Global E&E bookings of $120M-$130M, up 8%-15% Y/Y.
- For now, shares are unchanged AH.
- Q4 results, PR
Mar. 11, 2015, 4:20 PM
- Rosetta Stone (NYSE:RST): Q4 EPS of -$1.01 may not be comparable to consensus of -$0.13.
- Revenue of $79.25M (+2.0% Y/Y) misses by $2.07M.
Mar. 10, 2015, 5:35 PM
Oct. 29, 2014, 4:28 PM
- Rosetta Stone (NYSE:RST): Q3 EPS of -$0.76 misses by $0.42.
- Revenue of $64.51M (+6.0% Y/Y) misses by $4.48M.
Aug. 5, 2014, 4:09 PM
- Rosetta Stone (NYSE:RST): Q2 EPS of -$0.74 may not be comparable to consensus of -$0.20.
- Revenue of $57.32M (-7.8% Y/Y) misses by $9.46M.
Rosetta Stone, Inc. provides technology-based language learning solutions. It develops, markets and sells language learning solutions consisting of software products, online services and audio practice tools under the Rosetta Stone brand. The company's software products are sold on a direct... More
Industry: Multimedia & Graphics Software
Country: United States
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