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gluu earnings

KAMRAN
Wed, 03 Feb 2016 01:10:34 GMT

Given a lot of us are still invested in Gluu sold as a 'core' investment, may be worthwhile discussing earnings tomorrow. If i recall correctly, revenue targets are $50MM for the past quarter. They may achieve that given only 2 weeks of KP were accounted for in this quarter, and they probably didn't think KP is going to tank so badly, however revenue forecast is going to be dismal. Any earnings surprise will purely be grown by secular growth of mobile gaming. I'm also concerned about the extent of up front fees they paid to leverage KP's name, i'm not sure of the pricing structure but don't think the game even broke even with the upfront fees demanded by big name celebrities like KP. The next quarter will have very few catalysts, and even though KK is performing well in Canada, I don't think it will be a top 10 game that i had been hoping for. All this means that the outlook for Gluu isn't good, and the stock buyback is a sign of desperation. I hope analysts ask some tough questions of DeMassi, specially on the unmitigated disaster with the KP launch. Him and Gomes wo uld get along well: they talk a good talk. De Massi has done nothing but do the interview circuit while his company has been tanking. I'd take a buy-out at this point, even though i'll still be underwater. Hoping for the best tomorrow.

KAMRAN
Wed, 03 Feb 2016 23:33:57 GMT

no probably not worth selling based on the KK release coming out. That said I have no delusions that this will be $5 and $6 any time soon....it was a 11% holding for me, down to 5%, ,and i don't need the yo yo high beta swings that come with owning this stock. Probably ok for a 2-3% holding.

Gregory
Wed, 03 Feb 2016 23:34:30 GMT

> @Tim > The price hit a 3 year low today based on earning's miss. Don't expect to see that price again ever. mmm ya i thought the same thing - about $5/share - when they signed KPP and made the TenCent deal. never underestimate the ability of this company to screw things up royally. The only things they have done "right" since the release of the KKH game is sign some celebrities, and do the TenCent deal. Everything else they have done (game releases, updates, etc) has been an absolute disaster. Yes it does have nothing to do with MG and PTT, but they deserve each other

Florent
Thu, 04 Feb 2016 00:21:58 GMT

I don't see how signing Taylor Swift is a good thing. It's about the same demographics except less international than Kpp. Did they say Kpp was bad? Good. Did they explain why the game wasn't even downloaded before people saw it was bad ? That's a different story..

Thomas
Thu, 04 Feb 2016 00:39:25 GMT

227 million followers can not hurt.I see remi is in the house lol whats your take on all this?

Gregory
Thu, 04 Feb 2016 00:46:36 GMT

> @Florent > I don't see how signing Taylor Swift is a good thing. Well, if you are a GLUU holder, it is a good thing, until the game is released.....But seriously, it does put the company in the news again - Taylor Swift is a HUGE star, with more media popularity than KPP (by a long shot, it would seem). And when I say "more", I mean she is in the news, in controversies, etc. and also a huge following, in a manner I would view as possibly similar to K&K. Whereas KKP is a bit more boring. OTOH, I do totally agree that KPP being bad is one thing, but it didn't even get to the top 20 in DLs ever, if memory serves. This shows social following does not necessarily translate into DLs. That being said, if the game was decent, fun and operated well, one might expect a slightly better revenue showing than was observed, which was pretty much nothing. In the end, for the time being it is better than no news, and might propel this POS into the upper 2s/low 3s (one ca n dream) prior to K&K release, which might enable GLUU to hit the uppers 3s, 4s again before the summer (one can dream) if K&K hits well. I didn't listen to anything. Did they have a title release schedule?

Tim
Thu, 04 Feb 2016 00:53:36 GMT

$2.56/share bidding after hours. As bad as most expected today's earning's release to be, I don't know how it could get much better? Signing Taylor Swift, revenue & earning's beat, Kendall & Kylie game release in two weeks, management admitting they screwed up KPP, $1.40/share cash and company share buyback starting tomorrow. The sentiment was awful and most didn't want to risk being long.

Thomas
Thu, 04 Feb 2016 01:40:46 GMT

Two very good points Gregory and Tim. If the stock moves upward near the 2.70 range early morning I will be hard pressed not to unload some of my over sized position,A 25% to 30% move is a bit much and when the Market gets slapped again and I believe it will maybe I will reload .This has not been a fun ride.

kamlesh
Thu, 04 Feb 2016 01:49:03 GMT

are they going to launch kp again??

Gregory
Thu, 04 Feb 2016 01:59:46 GMT

> @Tim > $1.40/share cash and company share buyback starting tomorrow. yeah honestly this does make holding this a bit more stable. That cash will go down, but so will shares outstanding. It does seem like there is a bit more than $1/share in value, even on just the celebrity “IP” alone. GLUU makes crappy games, but if they indeed have the gaming rights to all those celebrities, that might make a company that can make decent games interested in that value.

Remi
Thu, 04 Feb 2016 02:56:57 GMT

In my mind once the disillusionment kicked in regarding the fundamentals, It became a trading stock - I drew the chart a month ago and the long term range from 2 to 5 dollars a share. Just look at the last 5 years since DeMasi has been there - bottom bottom bottom top top top, its like a pattern that plays itself over and over again. So it absolutely doesn't surprise me that it bounced hard off 2 dollars. I wouldn't even be that surprised if in the coming month it fell back down to close the gap at 2 - I would only be surprised if the 2 dollar level is not the floor at this point. You don't even have to know anything about the fundamentals really with a trading stock like this, the chart speaks to the psychology and how it's played by large investors, there will be an excuse to drive it up and one to drive it down later - just hype and then hate, don't fool yourself into analysing the price too much. I haven't listed to the conference call yet, may have comments afterwards.

Gregory
Thu, 04 Feb 2016 03:51:22 GMT

Thanks Remi. Very good points. I completely agree that this stock and its price and trading have no relation to its fundamentals, and pretty much everything to do with momentum and the latest trend with the stock. I personally am hoping that the trend stays up for the next few weeks (perhaps helped by the buyback) so that if there is a bump or climb resulting from K&K, it will start from a raised floor. I might even think that is the strategy of GLUU...after all, they LOVE their options.... Also, I personally cannot wait to get out of this crap and never look back.....

Thomas
Thu, 04 Feb 2016 22:42:16 GMT

Well it never reached my 2.70 price but I did down size my position at 2.63.With the Russel 2000 in a Bear Market and a 30% pop today I was willing to take my chances,I feel IF I choose to reload I should get a chance 15 to 20% lower if not Oh well, hmm looks like I have become a trader on this one. Oh and Gregory I thought it was kinda funny you cannot wait to exit GLUU and I cannot wait to exit JAKK, What ever happened to Richard he was high on that one,as I recall the writing was on the wall lol what wall the bathroom wall.

Gregory
Thu, 04 Feb 2016 23:07:21 GMT

yeah I got out of my last position in JAKK a few months back, around 8. I saw the writing on the wall there, that it was bound to head down. It may rebound in a bull market, esp with a good ER, but I just don't see a tremendous upside, while even an average ER sends this back to the low 6s, 5s. But wtfdik I see JAKK, and GLUU, as the best examples of MG's moving target theses for stock picks. Both original theses completely failed, and they were casually discarded without a word of discussion.

Thomas
Thu, 04 Feb 2016 23:36:10 GMT

Nice job you were smart enough to get out,At this point not really sure what the hek I am waiting for its down to a 1.5% pos for me I would be wise to wash my hands of it and move on.

Tim
Fri, 05 Feb 2016 01:22:08 GMT

I did nothing with my glu shares today. Expected a pullback, but ran from the open and closed high of the day. I don't like daily price gap ups, but the last time the price ran for three days straight after the gap up last April, before slowly falling. That was without the company buying back shares. Also the K&K games hits within 8 business days. If K&K does well, expectations for the TS game will soar. My account looks much better today than yesterday.

Thomas
Fri, 05 Feb 2016 01:55:50 GMT

Yes Tim I agree that is why I only sold a portion of my position, I did not feel comfortable holding a over sized position.

KAMRAN
Fri, 05 Feb 2016 03:43:56 GMT

Gluu's challenge has always been execution...the did an investor day in May of last year and gave outlandish projections, then just a few months later KP is delayed.....when it did launch they threw in the towel, as they knew it was a stinker. For a core holding there is just too much volatility. The CEO seemed a bit more contrite in this earning release on what happened with the KP game, but if I were KP i'd be livid, as everyone seems to have moved on and the focus now on her rival, TS. It seems that they are targetting much fewer games for this year, which i think is a wiser strategy but its all in on the celebrity genre with no DH, Racing Rivals releases planned for 2016. If TS gets delayed as did KP, you can expect a similar bloodbath. The stock is still very cheap and worth holding at this point, but I would definitely sell 1/3rd to half @ 4 dollars or so. I've also brought some calls on this one, in the event that it does run up. At least thats how i'm playing it.

Gregory
Fri, 05 Feb 2016 08:29:53 GMT

> @KAMRAN > but its all in on the celebrity genre with no DH, Racing Rivals releases planned for 2016. what happened to car town?

Alan
Fri, 05 Feb 2016 14:53:20 GMT

For me, the most promising part of the call was what De Masi said about retention. KPP retention was crap. KKJ is showing the best retention GLU has ever seen in its Canada Beta. As others have mentioned, its now all about installs for KKJ. De Masi alluded to the fact that you can work on installs if you've got good retention. Let's hope he has some real ideas of how to improve installs on KKJ, because if they can get that right (in addition to the retention) then I think KKJ can be a hit.

Alan
Fri, 05 Feb 2016 15:50:09 GMT

A comment from MG on his recent SA instablog: "Of course. I've discussed the new thesis on GLUU in previous posts. Management confirmed that view last night. It's a new (and bearish) world, my friend. I see GLUU outperforming the market through Q2, but topping out at $4 (at best). In this environment, that will qualify as heroic." Anyone aware of what his new GLUU thesis is? I'm guessing this is just more of his usual deception - and he hasn't actually provided a new thesis. But willing to be proven wrong.

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