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WIKI ANALYSIS
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This company completed an initial public offering (IPO) of its stock in 2010. View articles that reference this company. Recent IPOs: Globe Specialty Metals • LogMeIn • Invesco Mortgage Capital • Medidata • Chemspec |
Skullcandy (NASDAQ:SKUL) designs and distributes headphones targeted to the youth lifestyle. Skullcandy's products tend to be designed with bold colors and patterns in order to turn a quasi-commodity into a fashion item. Skullcandy's products are targeted to the action sports such as snowboarding, skateboarding, and surfing. The company does not operate its own retail stores and instead uses specialty retailers which tend to focus on those markets. Because Skullcandy's products are fundamentally fashion items, the company's sales are dependent on its ability to understand and market to the youth and sport markets.[1]
Business Overview
For the full year 2010, Skullcandy's total revenue was $160.6M. This was a 36% increase over the 2009 total revenue. For 2010, the company reported a net loss of $9.7M, this coming from a net income of 12.3M in 2009. This drop in net income was largely due to a substantial rise in the selling, general and administrative expenses.[2]
New Updates
The company's initial public offering of stock on the NASDAQ occurred on July 19, 2011. The company offered 9.44M shares each for $20. This was above the initial price range of $17-$19. The deal raised a total of $188.8M. The lead underwriters were Bank of America (BAC) and Morgan Stanley (MS) .[3]
Trends & Forces
Reliance on fashion among youth
Because Skullcandy's primary audience are youth, particularly those involved in action sports, the company must maintain a firm understanding of this demographic. In order for the headphones to remain fashionable and trendy, the company must constantly strive to design items which appeal to this group. This may be difficult do to the inherent complexity in youth styles and the speed with which they change. In particular, Skullcandy has sponsored top DJs and athletes in relevant sports through its marketing efforts. Selecting the correct influencers is crucial for the company to maintain a desirable image to its potential consumers.[4]
- ↑ SKUL S-1/A 2011 PROSPECTUS SUMMARY "Our Company" pg 1
- ↑ SKUL S-1/A 2011 PROSPECTUS SUMMARY "Summary Consolidated Financial Data" pg 1
- ↑ Renaissance Capital - IPO Home "Skullcandy prices its IPO at $20, above the range" 19 July 2011
- ↑ SKUL S-1/A 2011 PROSPECTUS SUMMARY "Risks Related to Our Business" pg 3-4
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