Hi Travelightor, Good post. I agree with most of your points but...

Hi Travelightor,

Good post. I agree with most of your points but i think that we need to hold judgement until we see the annual report.


The writing has been on the wall for Physical DVDs for a long time. Beyond need to strategize accordingly and in the report I would want to see an indication that management have a clear, coherent and pro-active plan. Winding down this division would be a better option than continuing it at a loss (if that is the situation).

Further implications of the announcement is that the rest of the business was flat but a heavy negative impact from foreign exchange. Currency conversion impacts aren't indicative of problems with the business model despite the impact to the headline numbers.

Regarding the dividend, it depends on how bad the situation really is. BYI has a solid balance sheet, so there may be no need to retain earnings to simply keep operations going - that's positive. However it may also be an indication that management have no ideas to invest in the business to grow earnings - that is either neutral or negative depending on your perspective.