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  • Pandora, Yelp soar following CFO presentations [View news story]
    Apparently the CFO has learned not to comment on how improbable M&A is. Those statements about the 80% royalty bump for an acquirer were as boneheaded as it gets.

    Now we're back to the Pandora that I knew! Hellaciously volatile as we fly blind between earnings calls; instead moving on momentum which is totally disconnected from underlying business model fundamentals.
    Aug 13 02:41 PM | 3 Likes Like |Link to Comment
  • Pandora gets a lift from vague M&A rumors [View news story]
    I'm usually not a conspiracy theorist about market manupulation -- but wow -- this should at least raise a few eyebrows at the SEC. That rumor and chart scream "PUMP AND DUMP".
    Aug 12 04:46 PM | 1 Like Like |Link to Comment
  • Pandora Grasping At Straws [View article]
    What a moron. Why would a CFO willfully kick out one of the only remaining legs from analysts investment theses?
    Aug 5 05:05 PM | 3 Likes Like |Link to Comment
  • Pandora Grasping At Straws [View article]
    "So if Google (or Microsoft, Amazon, Facebook, etc) wanted to buy P they would do direct deals with the labels."

    This 80% kicker is interesting. I had never heard of it and am surprised the stock isn't plummeting on that news.

    If an acquirer has to go out and negotiate royalties directly with all of the labels to avoid taking on massive losses, why on earth would MSFT, FB, GOOG or AMZN value it at $5b+??? Those companies all have or could easily build out the software and ad sales platform. You're literally just buying users and thumbs at that point -- and at an amazing premium.
    Aug 5 03:10 PM | 4 Likes Like |Link to Comment
  • Pandora Shows Us Analysts Can All Be Wrong [View article]
    I can't believe you missed out on the -12% action over the last two days! With such conviction, I figured that this earnings report would finally be the time where you had a position in P. Such a shame.
    Jul 28 02:58 PM | 1 Like Like |Link to Comment
  • Update: Pandora Beats Earnings But Market Is Clearly Nearing Saturation [View article]
    My take on the "big data" optimization relates back to a quote I saw awhile back...

    "Big data is like teenage sex. Everyone talks about it, nobody knows how to do it, everyone thinks everyone else is doing it, so everyone claims they are doing it..."

    The real value for Pandora isn't in giving data to artists. I don't think the labels will give two craps about thumbs. They certainly won't walk away from millions of dollars in royalty negotiations because of it.

    I'm sure P is already attempting to lump people into marketing demographics and voting blocks by the types of music they listen to. The problem for P is that you can also do this with an address or even zip code data, so the incremental value still isn't all that great.

    The difference between a music genre played by a terrestrial station and "the music genome" is probably insignificant to an advertiser. I'm just not convinced that you're going to get much more accurate targeting with thumbs. I'm sure P is selling it though.

    On the OpEx comparison, you're right. I should've pointed to the ~40% jump in royalties paid and compared it to the ~40% jump in revenues. ;p
    Jul 27 03:25 PM | 1 Like Like |Link to Comment
  • Update: Pandora Beats Earnings But Market Is Clearly Nearing Saturation [View article]
    "Much of the increase?" Let's be generous and assume those 91 employees are $100k/yr with benefits (in reality they're probably heavily commission-based, which further undercuts your argument, but let's go conservative). That's $9 million/yr.

    I think it's more fair to say "the vast majority of the increase is due to more music royalties paid." Its the business model. Enough of the hand waiving with the used car and mattress blowout ads.
    Jul 26 09:28 PM | 1 Like Like |Link to Comment
  • Update: Pandora Beats Earnings But Market Is Clearly Nearing Saturation [View article]
    Also, I can't wait for next quarters earnings report. Didn't they lift the listening cap in August? Gonna be a tough compare.
    Jul 25 07:04 AM | 1 Like Like |Link to Comment
  • Update: Pandora Beats Earnings But Market Is Clearly Nearing Saturation [View article]
    Yes, revenue increased by 43%, but total operating expenses increased 52%. It's an unsustainable business model.
    Jul 25 06:58 AM | 3 Likes Like |Link to Comment
  • Pandora -10.2% AH; subscription growth slows in Q2 [View news story]
    Confirmed again...growth is slowing and they still can't turn a profit. Not good for a stock trading at 150-200x earnings.
    Jul 24 04:27 PM | 2 Likes Like |Link to Comment
  • Based On Apple/Beats, Pandora Is Worth $11 - $12 Per Share [View article]
    @SE - I have no idea. I could maybe see MSFT or GOOG. Manic always talks about P's CEO and his relationship with MSFT, but that's pretty weak IMHO. MSFT has a track record of showing up late to the party, then having to make dumb acquisitions to catch up (e.g. NOK). GOOG might see some value in the user base, but has no need for the technology platform. Their monetization strategy would center around existing in-house ad placement, so they'll have to fire the whole sales force that P is hiring. I guess they did that with Motorola, so it's possible.

    @ manic - I don't defend a $6B+ market cap...but that's what the market has ascribed. My take is that the valuation is probably based on two main factors 1) there's a lot of dumb money flowing into anything social right now -- with no regard for current/future monetization, and 2) big tech companies have shown an appetite for eye popping acquisitions lately, so investors are placing bets on the next potential target. There are obviously also some believers in P's business model (dgulick) who think that P can swing to a profit on its own, but I don't think that's a big driver for the mainstream retail investor.

    I also don't think Google bought Songza exclusively for the user base, so you can't just do the straight math on $/user there. They have a lot of hobby projects at GOOG, so it's possible that they're viewing Songza as a cheap/easy way to experiment and see if there's any way they can squeeze value out of the streaming music biz.
    Jul 16 10:54 AM | Likes Like |Link to Comment
  • Based On Apple/Beats, Pandora Is Worth $11 - $12 Per Share [View article]
    @manic - It depends on how you value the acquisition of active users, technology platform, and music deals.

    @SE - P moved because it trades on pure momentum. Nobody knows how to fairly value a company with shaky fundamentals that stopped giving monthly user metrics. The shorts still don't see any value in all of those users if they can't be monetized, and the longs are now placing bets on an acquisition.

    Again, who knows what the market value of P is to a company that might acquire it? It comes back to my response to manic. If someone REALLY wants users and believes it can monetize better than P has done, maybe they do throw stupid money at it.

    From a revenue perspective, they're just totally different companies. You really might as well throw AMZN into the analysis too. They've got a small streaming service and lots of top line growth too.
    Jul 16 08:37 AM | 1 Like Like |Link to Comment
  • Based On Apple/Beats, Pandora Is Worth $11 - $12 Per Share [View article]
    But in the final analysis, you're comparing a premium headphone company to a streaming radio advertising company. Why not just throw Nest and Oculous VR in there too?
    Jul 15 01:24 PM | 3 Likes Like |Link to Comment
  • Pandora Has Power [View article]
    Now you've got it.
    Jul 10 02:34 PM | Likes Like |Link to Comment
  • Pandora Has Power [View article]
    LOL...your original article used the revenue differential to bash Spotify and assert P's dominance. You fixed most of your embarassing math errors, but kept the same final investment thesis (even though the revenue numbers flipped!).

    Now you need to check the bullet points at the top. You changed the $2 million in annual revenue for Spotify to $2 billion! They're big, but not that big. Later in the article you're showing the more reasonable $900 million number.
    Jul 10 12:57 PM | Likes Like |Link to Comment