Feeds

Aureal close to collapse – execs out on their ears

To sell or to wind down?

  • alert
  • submit to reddit

Providing a secure and efficient Helpdesk

Aureal has purged its entire executive management team and is considering "all necessary actions to either sell the Company or its assets or wind down the Company". The putsch for the digital audio company follows a horrible set of Q4 results, which saw the firm effectively run out of cash. It sees the departure of "President and CEO, Kip Kokinakis, its Chief Technical Officer, Scott Foster, its Chief Financial Officer, David Domeier, and its Chief Operating Officer and General Counsel, Brendan O'Flaherty, along with all senior staff members of Aureal". The board is seeking turnaround management. Word on the street was that Aureal has effectively been up for sale for several months, with Intel and Creative tipped as interested prospective buyers. Looks like any negotiations on that score has broken down. Aureal announced the departures, just one day after the company posted a very poor set of Q4 results (23 March). For the three months to 21 January sales were $8.5 million, down from $11.2 million in the third quarter and $10.8 million in the year-ago fourth quarter. Worse, losses ballooned to $9.5 million, compared to a loss of $3.5 million in the fourth quarter of 1998. The year-to-date loss for 1999 was $26.9 million, compared to a loss of $18.5 million for 1998. Kokinakis blamed the results on the "patent litigation with Creative and trial process distracted us. To fight and win a lawsuit of such magnitude was a major undertaking for a company our size, and it didn't come without significant costs. Both our people and financial resources were stretched, especially during the fourth quarter, and that impacted our efforts to further expand the reach of our products". Patent litigation expenses were $6.4 million in 1999, an increase of over $6 million from the prior year. "Unfortunately, even when you're right and you win in court, it can have a huge impact on your business," said David Domeier when he was still Senior VP Finance and CFO of Aureal. "We can't measure the impact of the trial process and attendant market disruption on our sales for the quarter or the year, but we know the customers were confused by what was going on. We lost sales and incurred substantial costs in preparing for and fighting the case in court." ®

Providing a secure and efficient Helpdesk

More from The Register

next story
Phones 4u slips into administration after EE cuts ties with Brit mobe retailer
More than 5,500 jobs could be axed if rescue mission fails
Apple CEO Tim Cook: TV is TERRIBLE and stuck in the 1970s
The iKing thinks telly is far too fiddly and ugly – basically, iTunes
Huawei ditches new Windows Phone mobe plans, blames poor sales
Giganto mobe firm slams door shut on Microsoft. OH DEAR
Phones 4u website DIES as wounded mobe retailer struggles to stay above water
Founder blames 'ruthless network partners' for implosion
Found inside ISIS terror chap's laptop: CELINE DION tunes
REPORT: Stash of terrorist material found in Syria Dell box
Show us your Five-Eyes SECRETS says Privacy International
Refusal to disclose GCHQ canteen menus and prices triggers Euro Human Rights Court action
prev story

Whitepapers

Secure remote control for conventional and virtual desktops
Balancing user privacy and privileged access, in accordance with compliance frameworks and legislation. Evaluating any potential remote control choice.
Saudi Petroleum chooses Tegile storage solution
A storage solution that addresses company growth and performance for business-critical applications of caseware archive and search along with other key operational systems.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.
Providing a secure and efficient Helpdesk
A single remote control platform for user support is be key to providing an efficient helpdesk. Retain full control over the way in which screen and keystroke data is transmitted.