TIVO Edges Past Earnings Estimates

Alviso, CA-based TiVo Inc. (NASDAQ: TIVO) delivered Q1 earnings per share of -$.13, beatings analyst consensus estimates by $.03 per share. Q1 net revenue was $61.4M, up compared to $55.1M in the year-ago quarter and the highest Q1 net revenue in three years.

President and CEO of TiVo, Tom Rogers, said “TiVo kicked off the fiscal year on a strong note, exceeding our revenue, net income and Adjusted EBITDA guidance, and maintaining our strong balance sheet of $255 million in cash and short-term investments, and no debt.”

For the first quarter, service and technology revenues were $43.2 million, compared with $48.5 million for the same period last year and $45.3 million in the prior quarter. Additionally, first quarter net revenue was $61.4M; up compared to $55.1M in the year-ago quarter and the highest Q1 net revenue in three years. Adjusted EBITDA was ($6.7) million, compared to guidance of ($9) million to ($11) million, and $5.3 million in the same period a year ago. Increased legal spend as well as research & development expenses relating to new products and distribution were a significant driver in the year-over-year Adjusted EBITDA decline. TiVo reported a net loss of ($14.2) million, compared to guidance of a net loss of ($19) million to ($21) million, and a ($3.9) million net loss in the year-ago quarter. Net loss per share this quarter was ($0.13).

Rogers also stated, “In terms of our strategic alliance with Best Buy (NYSE: BBY), we announced earlier today that development is underway between TiVo and Best Buy’s Insignia brand to integrate TiVo’s software and advanced television services into broadband-connected Insignia televisions. The new Insignia televisions will provide Best Buy customers with an exceptional, intuitive user experience for accessing online content by utilizing our latest non-DVR software, giving the viewer a one-stop-shop for delivering and searching content right on the television. This offering will add to the arsenal of unique approaches that TiVo has to shape the advanced television experience. Whether through the retail box, an operator provisioned box, software built into another box, a software upgrade to someone else’s DVR and non-DVR set-top boxes, and now software built directly into the television set, we are focused on taking numerous alternative means to affecting the television experience and providing a TiVo solution to each.

“We are also making notable progress with our audience research business as TiVo data becomes an increasingly important part of how the media industry evaluates viewership behavior and the effectiveness of ad campaigns. To that end, we recently teamed with Millward Brown, a global leader in marketing research that works with a significant portion of the top 100 global brands, to use TiVo’s audience research capabilities to test commercial effectiveness prior to and throughout its run to help these brands achieve more cost effective media-planning. We believe working with Millward Brown and some of the world’s top brands in this regard opens up a whole new avenue of growth for our audience research business.”

Rogers concluded, “We continue to expand our strategic initiatives demonstrating our potential for broad distribution in many incarnations. Our new broadened advanced television approach with its unique user interface has played a significant part in driving a range of new distribution partners. We remain a financially strong company with exciting growth prospects that will begin to play out in the years ahead, particularly with TiVo at the forefront of innovation and a driving force that defines how television viewers will access and consume content in an ever-changing media landscape.”

Financial Guidance:

For the second quarter of fiscal 2011, TiVo anticipates service and technology revenues in the range of $40 million to $42 million, a net loss in the range of ($17) million to ($19) million, and an Adjusted EBITDA loss in the range of ($9) million to ($11) million. This includes expected increased litigation expense and higher research & development costs due to increased product development and distribution.

Disclosure: No positions in the companies mentioned. TIVO was previously a premium watchlist selection

To get entry points, stop-loss points, and profit targets for my MAY watch list stocks and Featured Trade, simply try a 14-day complimentary trial by visiting here: Wall St. Cheat Sheet Premium