Welcome!

.NET Authors: Jim Kaskade, Adine Deford, TJ Randall, Sandi Mappic, Ivan Antsipau

News Feed Item

TiVo Reports Results for the Fourth Quarter and Fiscal Year Ended January 31, 2013

SAN JOSE, CA -- (Marketwire) -- 02/26/13 -- TiVo Inc. (NASDAQ: TIVO)

  • Achieved Adjusted EBITDA profitability, excluding litigation, in the fourth quarter
  • Highest ever quarterly Service & Technology revenue of $65.7 million in the fourth quarter, an increase of 31% year-over-year, exceeding guidance
  • Highest ever annual Service & Technology revenue in Fiscal Year 2013; grew 24% over Fiscal Year 2012
  • Net Loss of ($15.8) million in the fourth quarter
  • MSO revenue grew 83% year-over-year in the fourth quarter
  • Total subscriptions topped three million; grew 38% over Fiscal Year 2012
  • Significant progress on U.S. and international operator deals; GCI launched next-gen TiVo service
  • Launched TRA Crossmedia Measurement offering bringing television, Internet, and purchase data together in a single-source offering
  • Current business trends should drive Adjusted EBITDA profitability, including litigation expense, for Fiscal Year 2014

TiVo Inc. (NASDAQ: TIVO), a leader in the advanced television entertainment market, today reported financial results for the fourth quarter and fiscal year ended January 31, 2013.

Tom Rogers, President and CEO of TiVo, said, "We made significant progress in our business during Fiscal Year 2013, culminating with Adjusted EBITDA profitability, excluding litigation expense for the fourth quarter. We achieved success in five key areas during the last year. First, we drove expanded deployment in our current distribution deals, increasing the total number of TiVo subscriptions by almost one million over the course of Fiscal Year 2013. Second, we continued to increase our footprint both internationally and domestically, forging important new operator deals with Com Hem, Cable ONE, Midcontinent, Mediacom, and GCI. Third, we saw significant additional upside from litigation as we reached a favorable settlement with Verizon, bringing total damages and consideration from our intellectual property actions to more than $1 billion to date. Fourth, we reduced our R&D in the second half of the year from its peak in the first quarter of Fiscal Year 2013. Lastly, we continued to define the future of television through the launch of new whole-home and multi-screen TiVo offerings."

For the fourth quarter, service and technology revenues were $65.7 million, which was the highest in TiVo's history. This compared to guidance of $63 million to $65 million and $50 million for the same quarter last year. TiVo reported a net loss of $(15.8) million, compared to guidance of a net loss of $(15) million to $(17) million. This compared favorably to net income of $7.2 million in the same quarter last year when excluding the $54.4 million in litigation proceeds from the AT&T settlement. Adjusted EBITDA was $(2.6) million, compared to Adjusted EBITDA guidance of a loss of $(2) million to $(4) million including litigation expense, and compared favorably to Adjusted EBITDA of $21 million in the same quarter last year when excluding the $54.4 million in litigation proceeds from the AT&T settlement. Both net income and Adjusted EBITDA in the fourth quarter would have exceeded their respective guidance ranges had litigation spend not been $10.4 million, above previously anticipated levels of $7 million to $9 million. Excluding, litigation spend, Adjusted EBITDA was $7.8 million, compared to guidance of $5 million to $7 million.

Rogers continued, "We are very excited about the growing distribution of TiVo and about the deepening relationships we have with operators around the globe. This is underscored by the 83% increase in MSO revenue over last year and the 38% increase in total TiVo subscriptions. With upcoming launches of our deals we signed last year and the run rate on our current deals, we're on pace to drive a significant number of incremental subscriptions even without factoring in future deals.

"More specifically, in the U.K., our offering is helping drive significantly improved pay-TV growth and market share gains for Virgin Media. This past year Virgin Media added almost 900,000 TiVo subscriptions to reach a total of more than 1.3 million, or 35% of their base. As the Virgin Media offering evolves we believe even more fans of TV in the U.K. will seek out our unique offering. In Spain, our deployment with ONO continues to gain momentum and the fourth quarter was ONO's strongest quarter to date in terms of subscription additions.

"Our work with Com Hem in Scandinavia is progressing as our offering there is in the early testing stages with a full roll-out expected later this year. Com Hem is a perfect example of how operators are beginning to embrace new IPTV video delivery options across their networks and how TiVo can take them beyond the set-top box to provide a best-in-class experience through virtually any type of video delivery and on any type of device. The full IPTV multi-screen experience we are developing for Com Hem is one we expect more operators will be extremely interested in deploying as their infrastructures are upgraded and enhanced.

"Turning to our U.S. operator efforts, the strategic benefit of getting TiVo in front of subscribers has motivated many of our operator partners to look for ways to distribute TiVo beyond a single advanced-DVR experience. For example, Suddenlink, which also had its strongest quarter to date in terms of subscription additions, is now distributing our TiVo Premiere DVR, our TiVo Mini thin client, and TiVo Stream. We believe TiVo Stream is one of the most exciting television products in years as it allows customers to stream their favorite shows, the ones they recorded, from a TiVo Premiere series DVR simultaneously to multiple mobile devices.

"Additionally, GCI, one of the top 20 largest cable companies in the country, recently began its initial deployment of TiVo, approximately four months after the deal was announced. We anticipate several other U.S. operators will follow GCI as the year progresses.

"On the TiVo-Owned front, we were pleased with our progress this quarter as gross subscription additions were up roughly 10% year over year while churn remained relatively low. Additionally, our marketing efforts, which included some modest TV advertising, have been successful in driving increased brand awareness of TiVo, something we hope will drive even better results going forward. We also saw the lowest level of subscription losses in a little more than four years.

"The enhancements we continue to make to our product and service offerings and the progress that we continue to make toward our vision of a seamless in-home / out-of-home video experience have played key roles in our ability to engage in new relationships with cable operators, as well as to provide our existing customers with the best possible television experience. In the last year, we've made important strides in bolstering TiVo's multi-room and multi-device offerings, making our software scalable across deployments, and improving our search & discovery functions. At the same time, we reduced our overall research and development spend in the second half of the year from its peak in the first quarter of Fiscal Year 2013.

"As a result of these investments, we are on track to launch a TV Everywhere web portal powered by TiVo with our first MSO customer, which will allow subscribers the opportunity to enjoy video content on a variety of devices including tablets. In addition, we will be releasing our thin-client IP set-top box, TiVo Mini, in retail in the very near-future, which follows the successful launch of this product in our operator channel. Finally, the very popular music service Spotify, which is now available on the TiVo user interface, is yet another example of our efforts to deliver a complete entertainment experience, from television to movies to music, and we'll also be launching MLB.com on our platform soon to go along with the millions of content choices on TiVo.

"On the audience measurement front, our data analytics business continues to gain traction. We recently announced the launch of the TRA Crossmedia measurement solution, which combines Internet data, including display, online video, and social media with our television viewing and purchase behavior data to create a single cross-media data measurement source. Advertisers are increasingly demanding cross-platform measurement, and given the immense benefit a total view of household activities can bring, we believe this product will be a valuable addition to our unique insight capabilities. We continue to be excited about the potential of this business and are positioning it to be one of the elements that drives TiVo growth in the coming years.

"On the litigation front, we are continuing our efforts to protect our innovation beyond the successful actions we have had to date, which have yielded more than $1 billion in damages and consideration. Our Motorola litigation is nearing trial and we believe our prior successes position us well. Additionally, our pending case against Cisco and Time Warner Cable continues to move forward as well."

Rogers concluded, "This was an important year for TiVo as we were able to execute in five key areas. Looking ahead to the next fiscal year, we expect to continue to grow our revenues related to our current deployment deals, continue our subscription growth, and continue to efficiently manage our overall research and development spend. In addition, we continue to be highly focused on smart capital allocation to drive increased shareholder value. We also anticipate that our research analytics business will become a larger contributor to our growth. We believe that all of this, without even factoring in the potential upside from pending litigation, will help us to achieve Adjusted EBITDA profitability in Fiscal Year 2014 and sustained growth in the years beyond."

Management Provides Financial Guidance

For the first quarter of Fiscal Year 2014, TiVo anticipates service and technology revenues in the range of $60 million to $62 million. We expect lower technology revenue in the first quarter as revenue recognition from key MSO projects is expected to occur in the second quarter as opposed to first quarter. This will impact the first quarter negatively but is expected to benefit second quarter technology revenue significantly, making up for first quarter's technology revenue shortfall.

TiVo anticipates net loss in the range of ($16) million to ($19) million, and an Adjusted EBITDA of ($5) million to ($8) million, which includes $11 million to $12 million of litigation spend. TiVo expects to be profitable on an Adjusted EBITDA basis excluding litigation spend.

For the full year Fiscal 2014, TiVo continues to anticipate that current business trends should drive Adjusted EBITDA profitability, including litigation spend.

This financial guidance is based on information available to management as of February 26, 2013. TiVo expressly disclaims any duty to update this guidance.

Management's guidance includes Adjusted EBITDA, a non-GAAP financial measure as defined in Regulation G. TiVo has provided a reconciliation of EBITDA and Adjusted EBITDA to net income (loss) in the attached schedules solely for the purpose of complying with Regulation G and not as an indication that EBITDA or Adjusted EBITDA is a substitute measure for net income (loss).

Conference Call and Webcast

TiVo will host a conference call and Webcast to discuss the fourth quarter and fiscal year ended January 31, 2013 financial and operating results and guidance outlook at 2:00 pm PT (5:00 pm ET), today, February 26, 2013. To listen to the discussion, please visit http://www.tivo.com/ir and click on the link provided for the Webcast or dial (877) 618-4505 (conference ID number is 97400961). The Webcast will be archived and available through March 5, 2013 at http://www.tivo.com/ir or by calling (404) 537-3406; and entering the conference ID number 97400961.

About TiVo Inc.

Founded in 1997, TiVo Inc. (NASDAQ: TIVO) developed the first commercially available digital video recorder (DVR). TiVo offers the TiVo service and TiVo DVRs directly to consumers online at www.tivo.com and through third-party retailers. TiVo also distributes its technology and services through solutions tailored for cable, satellite, and broadcasting companies. Since its founding, TiVo has evolved into the ultimate single solution media center by combining its patented DVR technologies and universal cable box capabilities with the ability to aggregate, search, and deliver millions of pieces of broadband, cable, and broadcast content directly to the television. An economical, one-stop-shop for in-home entertainment, TiVo's intuitive functionality and ease of use puts viewers in control by enabling them to effortlessly navigate the best digital entertainment content available through one box, with one remote, and one user interface, delivering the most dynamic user experience on the market today. TiVo also continues to weave itself into the fabric of the media industry by providing interactive advertising solutions and audience research and measurement ratings services to the television industry.

TiVo and the TiVo Logo are trademarks or registered trademarks of TiVo Inc. or its subsidiaries worldwide. © 2013 TiVo Inc. All rights reserved. All other trademarks are the property of their respective owners.

This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to, among other things, TiVo's future business and growth strategies including future distribution agreements as well as revenue and subscription growth from MSO customers (both domestically and internationally), future growth in TiVo's overall subscription base, TiVo's upcoming launch of TiVo Mini device in retail and launch of the MLB.com on TiVo's retail platform, future launch of TV Everywhere web portal powered by TiVo, TiVo's future marketing plans and spend, the future availability of TiVo offering with Com Hem, Cable ONE, Midcontinent, Mediacom, and GCI next year, future growth in TiVo's audience research and measurement business, future decreases in TiVo R&D spending, and the future strength and value of TiVo's intellectual property portfolio. Forward-looking statements generally can be identified by the use of forward-looking terminology such as, "believe," "expect," "may," "will," "intend," "estimate," "continue," or similar expressions or the negative of those terms or expressions. Such statements involve risks and uncertainties, which could cause actual results to vary materially from those expressed in or indicated by the forward-looking statements. Factors that may cause actual results to differ materially include delays in development, competitive service offerings and lack of market acceptance, as well as the other potential factors described under "Risk Factors" in the Company's public reports filed with the Securities and Exchange, including the Company's Annual Report on Form 10-K for the fiscal year ended January 31, 2012, our Quarterly Reports on Form 10-Q for the periods ended April 30, 2012, July 31, 2012, and October 31, 2012, and Current Reports on Form 8-K. The Company cautions you not to place undue reliance on forward-looking statements, which reflect an analysis only and speak only as of the date hereof. TiVo disclaims any obligation to update these forward-looking statements.


                                  TIVO INC.
               CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
             (In thousands, except per share and share amounts)
                                 (unaudited)


                          Three Months Ended         Twelve Months Ended
                              January 31                  January 31
                     -------------------------------------------------------
                          2013          2012          2013          2012
                     -------------------------------------------------------
Revenues
    Service revenues $     35,574  $     31,578  $    133,725  $    131,341
    Technology
     revenues              30,153        18,465       101,592        58,945
    Hardware
     revenues              23,129        16,428        68,591        47,893
                     ------------  ------------  ------------  ------------
Net revenues               88,856        66,471       303,908       238,179
Cost of revenues
    Cost of service
     revenues              11,619         8,711        40,107        35,865
    Cost of
     technology
     revenues               7,318         4,502        23,175        23,056
    Cost of hardware
     revenues              21,847        20,368        78,183        59,439
                     ------------  ------------  ------------  ------------
  Total cost of
   revenues                40,784        33,581       141,465       118,360
                     ------------  ------------  ------------  ------------
      Gross margin         48,072        32,890       162,443       119,819
                     ------------  ------------  ------------  ------------
    Research and
     development           26,614        29,825       115,103       110,367
    Sales and
     marketing              8,928         6,393        30,353        26,388
    Sales and
     marketing,
     subscription
     acquisition
     costs                  3,471         1,320         8,660         7,392
    General and
     administrative        23,708        38,192        87,075        96,502
    Litigation
     Proceeds                   -       (54,444)      (78,441)     (230,160)
                     ------------  ------------  ------------  ------------
      Total
       operating
       expenses            62,721        21,286       162,750        10,489
                     ------------  ------------  ------------  ------------
      Income (loss)
       from
       operations         (14,649)       11,604          (307)      109,330
    Interest income           808         1,072         3,951         5,672
    Interest expense
     and other
     income
     (expense)             (1,966)       (5,430)       (7,872)      (12,034)
                     ------------  ------------  ------------  ------------
      Income (loss)
       before income
       taxes              (15,807)        7,246        (4,228)      102,968
      Benefit from
       (provision
       for) income
       taxes                   31           (61)       (1,036)         (807)
                     ------------  ------------  ------------  ------------
    Net income
     (loss)          $    (15,776) $      7,185  $     (5,264) $    102,161
                     ============  ============  ============  ============

    Net income
     (loss) per
     common share
      Basic          $      (0.13) $       0.06  $      (0.04) $       0.88
      Diluted        $      (0.13) $       0.06  $      (0.04) $       0.80

    Income (loss)
     for purposes of
     computing net
     income (loss)
     per share:
      Basic               (15,776)        7,185        (5,264)      102,161
      Diluted             (15,776)        7,185        (5,264)      109,140

    Weighted average
     common and
     common
     equivalent
     shares:
      Basic           120,199,937   117,747,442   119,411,727   116,592,943
      Diluted         120,199,937   122,042,180   119,411,727   136,255,424



                                  TIVO INC.
                    CONDENSED CONSOLIDATED BALANCE SHEETS
             (In thousands, except per share and share amounts)
                                 (unaudited)


                                                       As of January 31,
                                                   -------------------------
                                                       2013         2012
                                                   -------------------------
                       ASSETS
CURRENT ASSETS
  Cash and cash equivalents                        $   157,104  $   169,555
  Short-term investments                               470,136      449,244
  Accounts receivable, net of allowance for
   doubtful accounts of $362 and $370, respectively     40,102       24,665
  Inventories                                           14,500       18,925
  Deferred cost of technology revenues, current         14,713        4,400
  Prepaid expenses and other, current                    9,168       12,106
                                                   -----------  -----------
    Total current assets                               705,723      678,895
LONG-TERM ASSETS
  Property and equipment, net of accumulated
   depreciation of $51,012 and $47,170,
   respectively                                         10,300        9,191
  Developed technology, and intangible assets, net
   of accumulated amortization of $21,323 and
   $17,797, respectively                                16,086        4,677
  Deferred cost of technology revenues, long-term       16,011       23,546
  Goodwill                                              12,266            -
  Prepaid expenses and other, long-term                  3,267        3,501
    Total long-term assets                              57,930       40,915
                                                   -----------  -----------
      Total assets                                 $   763,653  $   719,810
                                                   ===========  ===========
        LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
  CURRENT LIABILITIES
  Accounts payable                                 $    24,492  $    32,102
  Accrued liabilities                                   50,043       45,341
  Deferred revenue, current                            103,505       74,986
                                                   -----------  -----------
    Total current liabilities                          178,040      152,429
  LONG-TERM LIABILITIES
  Deferred revenue, long-term                           71,823       81,336
  Convertible senior notes                             172,500      172,500
  Deferred rent and other long-term liabilities            526          518
                                                   -----------  -----------
    Total long-term liabilities                        244,849      254,354
                                                   -----------  -----------
      Total liabilities                                422,889      406,783
  COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
  Preferred stock, par value $0.001: Authorized
   shares are 10,000,000; Issued and outstanding
   shares - none                                             -            -
  Common stock, par value $0.001: Authorized shares
   are 275,000,000; Issued shares are 129,545,267
   and 123,073,486, respectively, and outstanding
   shares are 125,622,357 and 121,616,908,
   respectively                                            129          123
  Treasury stock, at cost - 3,922,910 shares and
   1,456,578 shares, respectively                      (37,791)     (13,788)
  Additional paid-in capital                         1,060,532    1,003,696
  Accumulated deficit                                 (682,328)    (677,064)
  Accumulated other comprehensive income                   222           60
                                                   -----------  -----------
      Total stockholders' equity                       340,764      313,027
                                                   -----------  -----------
      Total liabilities and stockholders' equity   $   763,653  $   719,810
                                                   ===========  ===========



                                  TIVO INC.
               CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                               (In thousands)
                                 (unaudited)


                                                       Fiscal Year Ended
                                                          January 31,
                                                   -------------------------
                                                       2013         2012
                                                   -------------------------
CASH FLOWS FROM OPERATING ACTIVITIES
  Net income (loss)                                $    (5,264) $   102,161
  Adjustments to reconcile net income (loss) to net
   cash provided by (used in) operating activities:
    Depreciation and amortization of property and
     equipment and intangibles                           9,332        8,805
    Stock-based compensation expense                    34,455       29,287
    Amortization of discounts and premiums on
     investments                                         4,852        4,068
    Non-cash loss on overallotment option and
     amortization of deferred debt issuance costs          961        2,432
    Impairment of a long-term cost method
     investment                                              -        3,400
    Utilization and write-down of trade credits              -          619
    Allowance for doubtful accounts                        219          476
  Changes in assets and liabilities:
    Accounts receivable                                (14,861)      (9,130)
    Inventories                                          4,425       (5,697)
    Deferred cost of technology revenues                (2,476)     (11,527)
    Prepaid expenses and other                           4,161       (2,752)
    Accounts payable                                   (10,280)      13,888
    Accrued liabilities                                  3,832       15,226
    Deferred revenue                                    17,925       87,673
    Deferred rent and other long-term liabilities            8          272
                                                   -----------  -----------
      Net cash provided by operating activities    $    47,289  $   239,201
                                                   -----------  -----------
CASH FLOWS FROM INVESTING ACTIVITIES

  Purchases of short-term investments                 (579,633)    (750,161)
  Sales or maturities of long-term and short-term
   investments                                         553,073      436,730
  Purchase of long-term investment                        (250)           -
  Acquisition of business, net of cash and cash
   equivalents acquired                                (24,466)           -
  Acquisition of property and equipment                 (6,451)      (4,918)
  Acquisition of capitalized software and
   intangibles                                             (95)        (408)
                                                   -----------  -----------
    Net cash used in investing activities          $   (57,822) $  (318,757)
                                                   -----------  -----------
CASH FLOWS FROM FINANCING ACTIVITIES
  Proceeds from issuance of convertible senior
   notes, net of issuance costs of $6,391                    -      166,109
  Proceeds from issuance of common stock related to
   exercise of common stock options                     16,268       11,297
  Proceeds from issuance of common stock related to
   employee stock purchase plan                          5,817        5,612
  Treasury stock - repurchase of stock                 (24,003)      (5,128)
                                                   -----------  -----------
    Net cash provided by (used in) financing
     activities                                    $    (1,918) $   177,890
                                                   -----------  -----------
NET INCREASE (DECREASE) IN CASH AND CASH
 EQUIVALENTS                                       $   (12,451) $    98,334
CASH AND CASH EQUIVALENTS:
  Balance at beginning of period                       169,555       71,221
                                                   -----------  -----------
  Balance at end of period                         $   157,104  $   169,555
                                                   ===========  ===========



                                  TIVO INC.
                                 OTHER DATA


                                                                 Guidance
                      Three Months Ended  Twelve Months Ended Reconciliation
                                                              --------------

                                                               Three Months
                         January 31,          January 31,         Ending
                     ----------------------------------------

                        2013      2012      2013      2012    April 30, 2013
                     ---------------------------------------- --------------
                                   (In thousands)              (In millions)

Net income (loss)    $(15,776) $  7,185  $ (5,264) $ 102,161   $(16) - $(19)
Add back:
  Depreciation &
   amortization         2,710     2,123     9,332      8,804        $3
  Interest income &
   expense              1,158       956     3,919      2,958        $1
  Provision for
   income tax             (31)       61     1,035        807        $0
                     --------  --------  --------  ---------  --------------
  EBITDA              (11,939)   10,325     9,022    114,730   $(12) - $(15)
  Stock-based
   compensation         9,292     7,308    34,455     29,287      $7 - $8
  Impairment of a
   long-term cost
   method investment        -     3,400         -      3,400
                     --------  --------  --------  ---------  --------------
  Adjusted EBITDA    $ (2,647) $ 21,033  $ 43,477  $ 147,417    $(5) - $(8)
                     --------  --------  --------  ---------  --------------
Litigation expenses  $ 10,409  $ 26,708  $ 38,055  $  50,503     $11 - $12
Litigation proceeds
 (past damage
 awards)             $      -  $(54,444) $(78,441) $(230,160)        -
Adjusted EBITDA
 excluding
 litigation expense
 and litigation
 proceeds (past
 damage awards)      $  7,762  $ (6,703) $  3,091  $ (32,240)     $4 - $7
                     ========  ========  ========  =========  ==============


EBITDA and Adjusted EBITDA Results. TiVo's "EBITDA" means income before interest income and expense, provision for income taxes and depreciation and amortization. TiVo's "Adjusted EBITDA" is EBITDA less expense for stock-based compensation. EBITDA and Adjusted EBITDA are not measures of financial performance under generally accepted accounting principles, which we refer to as GAAP. We have presented EBITDA and Adjusted EBITDA solely as supplemental disclosure because we believe they allow for a more complete analysis of our results of operations and we believe that EBITDA and Adjusted EBITDA are useful to investors because EBITDA and Adjusted EBITDA are commonly used to analyze companies on the basis of operating performance. In addition, because of the variety of equity awards used by companies, the varying methodologies for determining stock-based compensation expense, and the subjective assumptions involved in those determinations, we believe excluding stock-based compensation enhances the ability of management and investors evaluate our operating performance over multiple periods. Management does not use EBITDA or Adjusted EBITDA as a measure of liquidity because, among other things, they do not exclude the impact of deferred revenues associated with the amortization of product lifetime subscriptions. We do not use stock-based compensation expense in our internal measures. A limitation associated with these non-GAAP measures is that they do not include any stock-based compensation expense related to hiring, retaining, and incentivizing the Company's workforce. EBITDA and Adjusted EBITDA are not intended to represent, and should not be considered more meaningful than, or as an alternative to, measures of operating performance as determined in accordance with GAAP.



                                 TIVO INC.
                                 OTHER DATA

                                  Three Months Ended    Twelve Months Ended
Subscriptions                         January 31,           January 31,
----------------------------------------------------------------------------
   (Subscriptions in thousands)     2013       2012       2013       2012
----------------------------------------------------------------------------
TiVo-Owned Subscription Gross
 Additions:                             35         32        117        114
Subscription Net
 Additions/(Losses):
TiVo-Owned                             (13)       (26)       (80)      (157)
MSOs                                   222        260        950        387
                                 ---------  ---------  ---------  ---------
  Total Subscription Net
   Additions/(Losses)                  209        234        870        230
Cumulative Subscriptions:
TiVo-Owned                           1,029      1,109      1,029      1,109
MSOs                                 2,120      1,170      2,120      1,170
                                 ---------  ---------  ---------  ---------
  Total Cumulative Subscriptions     3,149      2,279      3,149      2,279
Fully Amortized Active Lifetime
 Subscriptions                         194        253        194        253
% of TiVo-Owned Cumulative
 Subscriptions paying recurring
 fees                                   53%        55%        53%        55%


Subscriptions. Management reviews this metric, and believes it may be useful to investors, in order to evaluate our relative position in the marketplace and to forecast future potential service revenues. The TiVo-Owned lines refer to subscriptions sold directly or indirectly by TiVo to consumers who have TiVo-enabled DVRs and for which TiVo incurs acquisition costs. The MSOs lines refer to subscriptions sold to consumers by multiple system operators and broadcasters such as DIRECTV, Cablevision Mexico, Seven/Hybrid TV (Australia), Television New Zealand (TVNZ) (New Zealand), Virgin Media (United Kingdom), RCN, and Suddenlink and for which TiVo expects to incur little or no acquisition costs. Additionally, we provide a breakdown of the percent of TiVo-Owned subscriptions for which consumers pay recurring fees, including on a monthly and a prepaid one, two, or three year basis, as opposed to a one-time prepaid product lifetime fee.

We define a "subscription" as a contract referencing a TiVo-enabled DVR for which (i) a consumer has committed to pay for the TiVo service and (ii) service is not canceled. We count product lifetime subscriptions in our subscription base until both of the following conditions are met: (i) the period we use to recognize product lifetime subscription revenues ends; and (ii) the related DVR has not made contact to the TiVo service within the prior six month period. Product lifetime subscriptions past this period which have not called into the TiVo service for six months are not counted in this total. We amortize all product lifetime subscriptions over a 60 month period. We are not aware of any uniform standards for defining subscriptions and caution that our presentation may not be consistent with that of other companies. Additionally, the subscription fees that our MSOs pay us are typically based upon a specific contractual definition of a subscriber or subscription which may not be consistent with how we define a subscription for our reporting purposes nor be representative of how such subscription fees are calculated and paid to us by our MSOs. Our MSOs subscription data is based in part on reporting from our third party MSO partners.



                                 TIVO INC.
                     OTHER DATA - KEY BUSINESS METRICS

                               Three Months Ended     Twelve Months Ended
                                  January 31,             January 31,
                             -----------------------------------------------
TiVo-Owned Churn Rate            2013        2012        2013        2012
----------------------------------------------------------------------------
                              (In thousands, except churn rate per month)
Average TiVo-Owned
 subscriptions                   1,035       1,122       1,062       1,174
TiVo-Owned subscription
 cancellations                     (48)        (58)       (197)       (271)
                             ---------   ---------   ---------   ---------
  TiVo-Owned Churn Rate per
   month                          (1.5)%      (1.7)%      (1.6)%      (1.9)%
                             ---------   ---------   ---------   ---------


TiVo-Owned Churn Rate per Month. Management reviews this metric, and believes it may be useful to investors, in order to evaluate our ability to retain existing TiVo-Owned subscriptions (including both monthly and product lifetime subscriptions) by providing services that are competitive in the market. Management believes factors such as service enhancements, service commitments, higher customer satisfaction, and improved customer support may improve this metric. Conversely, management believes factors such as increased competition, lack of competitive service features such as high definition television recording capabilities in our older model DVRs or access to certain digital television channels or MSO Video-on-Demand services, as well as, increased price sensitivity and installation and CableCARD™ technology limitations may cause our TiVo-Owned Churn Rate per month to increase.

We define the TiVo-Owned Churn Rate per month as the total TiVo-Owned subscription cancellations in the period divided by the Average TiVo-Owned subscriptions for the period (including both monthly and product lifetime subscriptions), which then is divided by the number of months in the period. We calculate Average TiVo-Owned subscriptions for the period by adding the average TiVo-Owned subscriptions for each month and dividing by the number of months in the period. We calculate the average TiVo-Owned subscriptions for each month by adding the beginning and ending subscriptions for the month and dividing by two. We are not aware of any uniform standards for calculating churn and caution that our presentation may not be consistent with that of other companies.



                                Three Months Ended     Twelve Months Ended
                                   January 31,             January 31,
                             -----------------------------------------------
                                 2013        2012        2013        2012
                             -----------------------------------------------
Subscription Acquisition
 Costs                                  (In thousands, except SAC)
-----------------------------
Sales and marketing,
 subscription acquisition
 costs                       $    3,471  $    1,320  $    8,660  $    7,392
Hardware revenues               (23,129)    (16,428)    (68,591)    (47,893)
Less: MSOs'-related hardware
 revenues                        16,834      11,641      45,849      31,483
Cost of hardware revenues        21,847      20,368      78,183      59,439
Less: MSOs'-related cost of
 hardware revenues              (11,036)     (9,412)    (38,435)    (23,577)
                             ----------  ----------  ----------  ----------
  Total Acquisition Costs         7,987       7,489      25,666      26,844
                             ==========  ==========  ==========  ==========
  TiVo-Owned Subscription
   Gross Additions                   35          32         117         114
  Subscription Acquisition
   Costs (SAC)               $      228  $      234  $      219  $      235
                             ==========  ==========  ==========  ==========


Subscription Acquisition Cost or SAC. Management reviews this metric, and believes it may be useful to investors, in order to evaluate trends in the efficiency of our marketing programs and subscription acquisition strategies. We define SAC as our total TiVo-Owned acquisition costs for a given period divided by TiVo-Owned subscription gross additions for the same period. We define total acquisition costs as sales and marketing, subscription acquisition costs less net TiVo-Owned related hardware revenues (defined as TiVo-Owned related gross hardware revenues less rebates, revenue share and market development funds paid to retailers) plus TiVo-Owned related cost of hardware revenues. The sales and marketing, subscription acquisition costs line item includes advertising expenses and promotion-related expenses directly related to subscription acquisition activities, but does not include expenses related to advertising sales. We do not include third parties' subscription gross additions, such as MSOs' gross additions with TiVo subscriptions, in our calculation of SAC because we typically incur limited or no acquisition costs for these new subscriptions, and so we also do not include MSOs' sales and marketing, subscription acquisition costs, hardware revenues, or cost of hardware revenues in our calculation of TiVo-Owned SAC. We are not aware of any uniform standards for calculating total acquisition costs or SAC and caution that our presentation may not be consistent with that of other companies.



                                Three Months Ended     Twelve Months Ended
                                   January 31,             January 31,
                             -----------------------------------------------
TiVo-Owned Average Revenue
 per Subscription                2013        2012        2013        2012
----------------------------------------------------------------------------
                                       (In thousands, except ARPU)
Total Service revenues       $   35,574  $   31,578  $  133,725  $  131,341
Less: MSOs'-related service
 revenues                        (8,191)     (4,472)    (24,985)    (16,589)
                             ----------  ----------  ----------  ----------
TiVo-Owned-related service
 revenues                        27,383      27,106     108,740     114,752
Average TiVo-Owned revenues
 per month                        9,128       9,035       9,062       9,563
Average TiVo-Owned per month
 subscriptions                    1,035       1,122       1,062       1,174
                             ----------  ----------  ----------  ----------
TiVo-Owned ARPU per month    $     8.82  $     8.05  $     8.53  $     8.15
                             ==========  ==========  ==========  ==========



                                Three Months Ended      Twelve Months Ended
                                   January 31,             January 31,
                             -----------------------------------------------
MSOs' Average Revenue per
Subscription                     2013        2012        2013        2012
----------------------------------------------------------------------------
                                        (In thousands, except ARPU)
Total Service revenues       $   35,574  $   31,578  $  133,725  $  131,341
Less: TiVo-Owned-related
 service revenues               (27,383)    (27,106)   (108,740)   (114,752)
                             ----------  ----------  ----------  ----------
MSOs'-related service
 revenues                         8,191       4,472      24,985      16,589
Average MSOs' revenues per
 month                            2,730       1,491       2,082       1,382
Average MSOs' per month
 subscriptions                    2,011       1,049       1,651         849
                             ----------  ----------  ----------  ----------
MSOs' ARPU per month         $     1.36  $     1.42  $     1.26  $     1.63
                             ==========  ==========  ==========  ==========


Average Revenue Per Subscription or ARPU. Management reviews this metric, and believes it may be useful to investors, in order to evaluate the potential of our subscription base to generate revenues from a variety of sources, including service fees, advertising, and audience research measurement. You should not use ARPU as a substitute for measures of financial performance calculated in accordance with GAAP. Management believes it is useful to consider this metric excluding the costs associated with rebates, revenue share, and other payments to channel because of the discretionary and varying nature of these expenses and because management believes these expenses, which are included in hardware revenues, net, are more appropriately monitored as part of SAC. We are not aware of any uniform standards for calculating ARPU and caution that our presentation may not be consistent with that of other companies. Furthermore, ARPU for our MSOs may not be directly comparable to the service fees we may receive from these partners on a per subscription basis as the fees that our MSOs pay us may be based upon a specific contractual definition of a subscriber or subscription which may not be consistent with how we define a subscription for our reporting purposes or be representative of how such subscription fees are calculated and paid to us by our MSOs. For example, an agreement that includes contractual minimums may result in a higher than expected MSOs ARPU if such fixed minimum fee is spread over a small number of subscriptions.

We calculate ARPU per month for TiVo-Owned subscriptions by subtracting MSOs'-related service revenues (which includes MSOs' subscription service revenues and MSOs'-related advertising revenues) from our total reported net service revenues and dividing the result by the number of months in the period. We then divide by Average TiVo-Owned subscriptions for the period, calculated as described above for churn rate. The above table shows this calculation.

We calculate ARPU per month for MSOs' subscriptions by first subtracting TiVo-Owned-related service revenues (which includes TiVo-Owned subscription service revenues and TiVo-Owned related advertising revenues) from our total reported service revenues. Then we divide average revenues per month for MSOs'-related service revenues by the average MSOs' subscriptions for the period. The above table shows this calculation.

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

@ThingsExpo Stories
SYS-CON Events announced today that SOA Software, an API management leader, will exhibit at SYS-CON's 15th International Cloud Expo®, which will take place on November 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. SOA Software is a leading provider of API Management and SOA Governance products that equip business to deliver APIs and SOA together to drive their company to meet its business strategy quickly and effectively. SOA Software’s technology helps businesses to accelerate their digital channels with APIs, drive partner adoption, monetize their assets, and achieve a...
SYS-CON Events announced today that Aria Systems, the recurring revenue expert, has been named "Bronze Sponsor" of SYS-CON's 15th International Cloud Expo®, which will take place on November 4-6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. Aria Systems helps leading businesses connect their customers with the products and services they love. Industry leaders like Pitney Bowes, Experian, AAA NCNU, VMware, HootSuite and many others choose Aria to power their recurring revenue business and deliver exceptional experiences to their customers.
SYS-CON Events announced today that AgilePoint, the leading provider of Microsoft-centric Business Process Management software, will exhibit at SYS-CON's 2nd International @ThingsExpo which will take place on November 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. AgilePoint is the leading provider of Microsoft-based Business Process Management (BPM) software products, has 1,300+ on-premise and cloud deployments in 25+ countries and provides the same advanced BPM feature set as J2EE vendors like IBM and Appian for the Microsoft .NET native environment. AgilePoint customer...
The Internet of Things (IoT) promises to evolve the way the world does business; however, understanding how to apply it to your company can be a mystery. Most people struggle with understanding the potential business uses or tend to get caught up in the technology, resulting in solutions that fail to meet even minimum business goals. In his session at Internet of @ThingsExpo, Jesse Shiah, CEO / President / Co-Founder of AgilePoint Inc., will show what is needed to leverage the IoT to transform your business. He will discuss opportunities and challenges ahead for the IoT from a market and tec...
SYS-CON Events announced today that Utimaco will exhibit at SYS-CON's 15th International Cloud Expo®, which will take place on November 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. Utimaco is a leading manufacturer of hardware based security solutions that provide the root of trust to keep cryptographic keys safe, secure critical digital infrastructures and protect high value data assets. Only Utimaco delivers a general-purpose hardware security module (HSM) as a customizable platform to easily integrate into existing software solutions, embed business logic and build s...
One of the biggest challenges when developing connected devices is identifying user value and delivering it through successful user experiences. In his session at Internet of @ThingsExpo, Mike Kuniavsky, Principal Scientist, Innovation Services at PARC, will describe an IoT-specific approach to user experience design that combines approaches from interaction design, industrial design and service design to create experiences that go beyond simple connected gadgets to create lasting, multi-device experiences grounded in people’s real needs and desires.
Samsung VP Jacopo Lenzi, who headed the company's recent SmartThings acquisition under the auspices of Samsung's Open Innovaction Center (OIC), answered a few questions we had about the deal. This interview was in conjunction with our interview with SmartThings CEO Alex Hawkinson. IoT Journal: SmartThings was developed in an open, standards-agnostic platform, and will now be part of Samsung's Open Innovation Center. Can you elaborate on your commitment to keep the platform open? Jacopo Lenzi: Samsung recognizes that true, accelerated innovation cannot be driven from one source, but requires a...
The Internet of Things will greatly expand the opportunities for data collection and new business models driven off of that data. In her session at Internet of @ThingsExpo, Esmeralda Swartz, CMO of MetraTech, will discuss how for this to be effective you not only need to have infrastructure and operational models capable of utilizing this new phenomenon, but increasingly service providers will need to convince a skeptical public to participate. Get ready to show them the money! Speaker Bio: Esmeralda Swartz, CMO of MetraTech, has spent 16 years as a marketing, product management, and busin...
SYS-CON Events announced today that TeleStax, the main sponsor of Mobicents, will exhibit at Internet of @ThingsExpo, which will take place on November 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. TeleStax provides Open Source Communications software and services that facilitate the shift from legacy SS7 based IN networks to IP based LTE and IMS networks hosted on private (on-premise), hybrid or public clouds. TeleStax products include Restcomm, JSLEE, SMSC Gateway, USSD Gateway, SS7 Resource Adaptors, SIP Servlets, Rich Multimedia Services, Presence Services/RCS, Diame...
Things are being built upon cloud foundations to transform organizations. This CEO Power Panel at 15th Cloud Expo, moderated by Roger Strukhoff, Cloud Expo and @ThingsExpo conference chair, will address the big issues involving these technologies and, more important, the results they will achieve. How important are public, private, and hybrid cloud to the enterprise? How does one define Big Data? And how is the IoT tying all this together?
We certainly live in interesting technological times. And no more interesting than the current competing IoT standards for connectivity. Various standards bodies, approaches, and ecosystems are vying for mindshare and positioning for a competitive edge. It is clear that when the dust settles, we will have new protocols, evolved protocols, that will change the way we interact with devices and infrastructure. We will also have evolved web protocols, like HTTP/2, that will be changing the very core of our infrastructures. At the same time, we have old approaches made new again like micro-services...
The only place to be June 9-11 is Cloud Expo & @ThingsExpo 2015 East at the Javits Center in New York City. Join us there as delegates from all over the world come to listen to and engage with speakers & sponsors from the leading Cloud Computing, IoT & Big Data companies. Cloud Expo & @ThingsExpo are the leading events covering the booming market of Cloud Computing, IoT & Big Data for the enterprise. Speakers from all over the world will be hand-picked for their ability to explore the economic strategies that utility/cloud computing provides. Whether public, private, or in a hybrid form, clo...
SYS-CON Events announces a new pavilion on the Cloud Expo floor where WebRTC converges with the Internet of Things. Pavilion will showcase WebRTC and the Internet of Things. The Internet of Things (IoT) is the most profound change in personal and enterprise IT since the creation of the Worldwide Web more than 20 years ago. All major researchers estimate there will be tens of billions devices--computers, smartphones, tablets, and sensors – connected to the Internet by 2020. This number will continue to grow at a rapid pace for the next several decades.
SYS-CON Events announced today that Gridstore™, the leader in software-defined storage (SDS) purpose-built for Windows Servers and Hyper-V, will exhibit at SYS-CON's 15th International Cloud Expo®, which will take place on November 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. Gridstore™ is the leader in software-defined storage purpose built for virtualization that is designed to accelerate applications in virtualized environments. Using its patented Server-Side Virtual Controller™ Technology (SVCT) to eliminate the I/O blender effect and accelerate applications Gridsto...
SYS-CON Events announced today that Red Hat, the world's leading provider of open source solutions, will exhibit at Internet of @ThingsExpo, which will take place on November 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. Red Hat is the world's leading provider of open source software solutions, using a community-powered approach to reliable and high-performing cloud, Linux, middleware, storage and virtualization technologies. Red Hat also offers award-winning support, training, and consulting services. As the connective hub in a global network of enterprises, partners, a...
As the Internet of Things unfolds, mobile and wearable devices are blurring the line between physical and digital, integrating ever more closely with our interests, our routines, our daily lives. Contextual computing and smart, sensor-equipped spaces bring the potential to walk through a world that recognizes us and responds accordingly. We become continuous transmitters and receivers of data. In his session at Internet of @ThingsExpo, Andrew Bolwell, Director of Innovation for HP’s Printing and Personal Systems Group, will discuss how key attributes of mobile technology – touch input, senso...
The Internet of Things (IoT) is making everything it touches smarter – smart devices, smart cars and smart cities. And lucky us, we’re just beginning to reap the benefits as we work toward a networked society. However, this technology-driven innovation is impacting more than just individuals. The IoT has an environmental impact as well, which brings us to the theme of this month’s #IoTuesday Twitter chat. The ability to remove inefficiencies through connected objects is driving change throughout every sector, including waste management. BigBelly Solar, located just outside of Boston, is trans...
Connected devices and the Internet of Things are getting significant momentum in 2014. In his session at Internet of @ThingsExpo, Jim Hunter, Chief Scientist & Technology Evangelist at Greenwave Systems, will examine three key elements that together will drive mass adoption of the IoT before the end of 2015. The first element is the recent advent of robust open source protocols (like AllJoyn and WebRTC) that facilitate M2M communication. The second is broad availability of flexible, cost-effective storage designed to handle the massive surge in back-end data in a world where timely analytics...
Internet of @ThingsExpo Silicon Valley announced on Thursday its first 12 all-star speakers and sessions for its upcoming event, which will take place November 4-6, 2014, at the Santa Clara Convention Center in California. @ThingsExpo, the first and largest IoT event in the world, debuted at the Javits Center in New York City in June 10-12, 2014 with over 6,000 delegates attending the conference. Among the first 12 announced world class speakers, IBM will present two highly popular IoT sessions, which will take place November 4-6, 2014 at the Santa Clara Convention Center in Santa Clara, Calif...
From a software development perspective IoT is about programming "things," about connecting them with each other or integrating them with existing applications. In his session at @ThingsExpo, Yakov Fain, co-founder of Farata Systems and SuranceBay, will show you how small IoT-enabled devices from multiple manufacturers can be integrated into the workflow of an enterprise application. This is a practical demo of building a framework and components in HTML/Java/Mobile technologies to serve as a platform that can integrate new devices as they become available on the market.