Axis Confirms IP Video Growth Slowing Significantly 2008Author: John Honovich, Published on Dec 16, 2008
In a stunning, unprompted move, Axis has issued a press release confirming that growth in IP video is slowing significantly. While the press release offers no new information nor statistics, it does reference previous warnings that Axis had made earlier and notes that this 'view has been strengthened in recent times.'
On the one hand, this does not surprise me at all as I have been warning about the severe impact in the 2009 Video Surveillance Industry Guide and since July. Indeed, just two months ago we examined how Axis growth rate has been clearly slowing for the last 6 quarters.
On the other hand, issuing a press release with no details and no clearly motivating factor is surprising and honestly a little scary (even for me). Corporations rarely want to focus on negative issues as this scares investors and partners. Indeed, investors are frightened dropping the price of Axis' shares by 10 points (15%) on the market's open (and finished the week down a total of 20%).
I suspect Axis 4th quarter may be bad and significantly worse than expectations. Their quarter is 3/4 complete and they probably have a good idea where it is heading. [Note: I am speculating and I have no inside information here - so ignore or discount what I am saying here.]
The only reasonable explanation I have for a company issuing such a press release is that they know results are going to be bad and that they are trying to set expectations low in preparation. If results were in line with expectations, the 'rational' thing to do is what March Networks recently did and cheer the results, explaining how strong your company is in face of the recession.
If you still thought IP Video was simply going to sail through the recession, this needs to be your wake up call. While Axis has risks (all companies do), if Axis is suffering, most everyone will suffer.
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