We are ready for the fourth quarter. Reaching pro forma profit does not require heroics, just execution.
We expect our U.S. Books, Music and DVD/Video segment to be profitable on a pro forma operating basis for the full year 2000.
In addition we expect to end the year with roughly $1 billion in cash.
We expect strong year-over-year sales growth in the first quarter, and our outlook for growth in 2000 remains strong. We expect that in 2000, our overall operating loss will decrease significantly as a percentage of sales.
Over the past year, our U.S. pro forma operating loss decreased from 24 percent of net sales in the fourth quarter of 1999 to less than 2 percent in the fourth quarter of 2000.
At the time of our last earnings call, we estimated industry numbers to be lightly up against last year given the introduction of two new platforms. It now appears that the overall market will be down in the double digits. The demand curve has shifted abruptly.
We continue to make progress toward reaching pro forma operating profitability in the fourth quarter of 2001, ... This quarter, the U.S. was profitable on a pro forma operating basis for the first time, and this is our sixth sequential quarter of improved absolute pro forma operating results.
With respect to cash, I'd like to make one point. Unless we choose to raise cash to further strengthen our balance sheet or for strategic flexibility, we have no reason to do so.
We went all-out to make sure we delivered for customers this holiday season.
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