* Second-quarter loss $0.23/shr vs est loss $0.24/shr
* Second-quarter revenue up 7 pct to $65.3 mln vs est $54.3
* Shares up 5 pct in after-market trade
By Chandni Doulatramani
Aug 29 TiVo Inc reported
better-than-expected quarterly results as it saw higher sales of
its trademark digital video recorders at customer Virgin Media
Inc, sending its shares up 5 percent in extended trade.
While TiVo continues to sell its set-top boxes, it also
licenses its digital video recording technology to cable
operators such as Virgin, Charter, DirecTV, Ono, RCN and
"The number of TiVo subscriptions across the globe grew 41
percent year-over-year this quarter, highlighted by continued
success at Virgin Media, which recently reached one million TiVo
subscriptions," Chief Executive Tom Rogers said in a statement.
Rogers said Virgin Media contributes the highest number of
subscribers to TiVo. Out of a total of 2.7 million subscribers,
Virgin Media's share is about 1 million subscribers.
Total subscriptions grew by 230,000 in the second quarter.
TiVo owns hundreds of patents and regularly sues other
companies to protect its intellectual property. A good chunk of
its revenue comes from litigation settlements.
Billionaire Charlie Ergen-led Dish Network Corp and
EchoStar Corp in May agreed to pay TiVo $500 million to
settle a patent dispute.
TiVo has been facing rising legal costs as it fights patent
lawsuits against Verizon Communications Inc, Motorola
Mobility Inc and Time Warner Cable related to video
"In the second quarter, litigation cost was about $12.5
million," Rogers told Reuters. "With Motorola, Cisco, Time
Warner and Verizon litigations moving forward, those expenses
will remain heavy."
The company is preparing to go to trial in October against
Verizon, which originally filed six patent claims, recently
pulled a fifth patent from its case against TiVo.
"I think once they have the Verizon litigation behind them,
they may end up having somewhat lower legal expenses. The
biggest period of expenses is right before trial, and we're in
there right now," MDC Financial Research analyst Michael Cohen
TiVo may also look to settle with Verizon before trial as it
did with Verizon's rival AT&T Inc in January, when the
wireless operator agreed to pay TiVo at least $215 million as
well as monthly licensing fees.
Analyst Cohen said any settlement with Verizon could be in
the range of $250 million to $400 million.
TiVo expects a net loss in the range of $27 million to $29
million for the third quarter.
Analysts were expecting a net loss of $20.7 million,
according to Thomson Reuters I/B/E/S.
Revenue in the second quarter at TiVo rose 7 percent to
Net loss widened to $27.7 million, or 23 cents per share, in
the second quarter, from $19.6 million, or 17 cents per share, a
Analysts on average had expected a loss of 24 cents per
share on revenue of $54.3 million.
Shares of TiVo were up at $9.80 in extended trade. They
closed at $9.36 on the Nasdaq on Wednesday.