TiVo Inc. Earnings: Margins Expand Again

TiVo Inc. (NASDAQ:TIVO) climbed to a profit in the third quarter and beat Wall Street’s expectations in the process. Tivo is a provider of technology and services for digital video recorders.

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TiVo Inc. Earnings Cheat Sheet

Results: Reported a profit of $59 million (44 cents per diluted share) in the quarter. TiVo Inc. had a net loss of $24.5 million or a loss 21 cents per share in the year-earlier quarter.

Revenue: Rose 26.6% to $82 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: TiVo Inc. beat the mean analyst estimate of a loss of 23 cents per share. It beat the average revenue estimate of $54.9 million.

Quoting Management: Tom Rogers, President and CEO of TiVo, said, “This was another strong quarter for TiVo marked by meaningful execution across all areas of our business. We delivered solid revenue growth and our Adjusted EBITDA and net income exceeded our guidance even when excluding the significant positive impact of our litigation settlement with Verizon. We also signed new operator partnerships and continued to build our data analytics business. As a result of the progress we have made toward our operational goals, we expect to be profitable next quarter on an Adjusted EBITDA basis excluding litigation spend. “During the third quarter, overall subscriptions increased 44% year-over-year as our deals with pay-TV operators brought TiVo to more and more homes and our MSO service revenue grew 84% in the third quarter as compared to the year-ago quarter, significantly more than the second quarter year-over-year growth rate of 22%. We continued to sign on new operator partners as Mediacom, Midcontinent, and Cable ONE turned to TiVo for their advanced television offerings, securing our leadership position amongst mid-sized operators and setting the stage for continued growth in our MSO business. Finally, the value of our intellectual property was once again highlighted by another favorable patent settlement, this time with Verizon, bringing the total consideration from the enforcement of our intellectual property to more than $1 billion from three litigations, and we believe further bolstering our position with respect to our ongoing intellectual property enforcement actions.”

Key Stats:

Revenue has increased for four quarters in a row. Revenue increased 6.7% to $65.3 million in the second quarter. The figure rose 48.1% in the first quarter from the year earlier and climbed 19.1% in the fourth quarter of the last fiscal year from the year-ago quarter.

The company beat estimates last quarter after being in line with expectations in the second quarter with a loss of 23 cents per share.

Looking Forward: The average estimate for the fourth quarter is steady at 12 cents a share. Down from a loss of 70 cents per share ninety days ago, the average estimate for the fiscal year is now a loss of 78 cents.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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