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Wednesday, January 14, 2015

What Avid's Relisting Means For Pro Tools Users

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Last month everyone's favorite DAW maker Avid was relisted on the NASDAQ stock exchange, a move that came as a surprise to many.

When the company was delisted back in February of 2014, many analysts (including yours truly) felt that this was the first sign of the eventual slow demise of the company, and that it was highly unlikely to ever find its way back onto the exchange. Avid defied expectations by working with auditors to supply the exchange with the information required to resume trading there. The company was officially delisted for not filing the required quarterly reports for over year, which Avid claimed was due to accounting rules changes

Since being relisted, the company's stock has risen from $13.50 to just a shade under $15. It continues to trade under its AVID symbol.

Regardless of the happy event, this is a challenging time for Avid. While having a virtually stranglehold on the professional audio workstation world, that market is somewhat saturated, and with more powerful computers now available, the native versions of the software now works for many cases where an expensive hardware accelerator card was once required, which means less revenue for the company.

Add to that the general frustration of the Pro Tools community that feels somewhat abandoned by the company's recent employee turnover, and many users are now open for an alternative should it arise.

Still, Avid's relisting also means that the company is much stronger than before. Sources of capital are more readily available if needed, the stock is much healthier than it was 12 months ago, and the company's public perception has risen. All that doesn't matter much if it doesn't find a way to assuage its customers who feel burnt by the company, of which there are many. We all like to upgrade to get new features, but the feeling of being forced to do so has rubbed many the wrong way through the years.

The upcoming NAMM show next week can be a pivotal one for the Avid, depending on the new products they show, or even worse, might not have. Could this be the year of serious DAW competition?

1 comment:

Anonymous said...

Yep and while everyone was cheering the demise of Avid, I brought up that this was temporary, went over to the penny stocks where Avid was trading at around $5, and bought as many shares as I could. Last week was a happy day here financially.


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