Wall Street Cautiously Optimistic About LeapFrog Q4

LeapPad

With three out of four of the best-selling digital toys of the last year, LeapFrog is expected by Wall Street to announce solid fourth-quarter returns today, buoyed by robust holiday sales. Analysts are looking for the Emeryville, Calif., educational toy company to earn 49 cents a share on revenue of $223 million in the period.

Strong Q4 earnings are typical, since LeapFrog usually has strong seasonal sales. This year, its LeapPad 2 sold out on Amazon, Target, Toys “R” Us and Walmart at the full $99 price.

The performance is a small beacon of light in the overall flagging state of the toy sector, which is quickly shifting to digital products, such as the tablets that LeapFrog makes.

With an increasingly tech-savvy generation of children to satisfy, LeapFrog is in a comfortable position to focus on considerable expansion in 2013, particularly internationally. It recently inked deals with Viacom International Media Networks to expand its Nickelodeon content to overseas markets in the U.K., Ireland, Australia, New Zealand and Canada.

LeapFrog will have to invest in substantial R&D in 2013, and it faces more competition, as other kid-centric tablets have flooded the market recently.

LeapFrog will announce its fourth-quarter results at 2 pm PT.


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Another gadget you don’t really need. Will not work once you get it home. New model out in 4 weeks. Battery life is too short to be of any use.

— From the fact sheet for a fake product entitled Useless Plasticbox 1.2 (an actual empty plastic box) placed in L.A.-area Best Buy stores by an artist called Plastic Jesus