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Sonicblue expects to exceed estimates

The electronics maker is beginning to see the benefits of a turnaround strategy it started about a year and a half ago. Still, the company is hitting some potholes.

Electronics maker Sonicblue announced Monday that it expects to exceed first-quarter revenue estimates.

During the company's fourth-quarter financial results call in February, Chief Operating Officer John Todd said Sonicblue was comfortable with analysts' consensus revenue estimates. The Santa Clara, Calif.-based company said in a release that it expects to report revenue for the first quarter that is ahead of consensus expectations of $58 million.

"We continue to be encouraged with the demand for our products," Sonicblue CEO Ken Potashner said in a release. "We are also optimistic that our newly announced digital audio and video products will receive similar, positive, customer receptivity."

Sonicblue is beginning to see the benefits of a turnaround strategy it started about a year and a half ago. Still, the company has hit some potholes of late.

Just more than a week ago, the company announced that its newly hired chief financial officer, David Sugishita, was leaving. The company said the move was mutually agreed on and effective immediately.

Sonicblue is actively searching for a replacement both inside and outside the company, according to representatives. COO Todd is serving as interim CFO.

Additionally, the company was caught off guard during the holiday season when most of its inventory was sold out in popular product lines such as the Rio CD-based MP3 player, the Go-Video combination DVD/VCR player, and the ReplayTV digital video recorder.

But Sonicblue managed to increase production of those product lines and meet demand for the first quarter. While this is not a major feat, as the first quarter is traditionally a slow time for consumer-electronics sales, it's a sign that the company can accelerate production quickly if needed.

During the course of the first quarter, Sonicblue began shipping to retailers its $400 Rio Riot MP3 player, which comes with a 20GB hard drive. The Riot is expected to compete with Apple Computer's iPod.

The company also signed an agreement with online retailer Amazon.com to sell Sonicblue's ReplayTV digital video recorder.

On the downside, the company was replaced by Philips Electronics as a supplier for Nike.

Sonicblue is looking to announce its first-quarter results in the first week in May, according to representatives.

This is the second time in consecutive quarters that the company has issued a release saying it expects to exceed revenue estimates. Before its fourth-quarter results, the company said it expected to pass revenue estimates, and its shares jumped about 30 percent the following day.

Sonicblue shares were trading at $2.84, up 32 cents, or around 13 percent, on Monday afternoon.

Analysts are expecting Sonicblue to report a loss of 6 cents per share for the first quarter, according to First Call.