November 23, 2010 / 11:04 PM / 8 years ago

UPDATE 2-TiVo widens loss, misses Street

* EPS loss $0.18 vs Street view loss $0.17

* Revenue falls 11 percent

* Holiday pricing to hit Q4 EBITDA by up to $10 mln

* TiVo could gain $300 million in Dish litigation-company

* Shares down 3.3 percent in after hours (Adds CEO, analyst comment, updates share price and byline)

By Liana B. Baker

NEW YORK, Nov 23 (Reuters) - Digital video recorder maker TiVo Inc (TIVO.O) reported a wider quarterly loss as sales fell and it spent more on legal fees and research and development.

TiVo shares were down 3.3 percent in after-hours trading.

The company posted a third-quarter net loss of $20.6 million, or 18 cents a share, compared with a loss of $6.4 million, or 6 cents a share, a year earlier.

Analysts on average were looking for a loss of 17 cents a share, according to Thomson Reuters I/B/E/S.

In its legal battle with EchoStar (SATS.O) and DISH Network <DISH.O, the company said it expects a decision from the appeals court in the next few months, according to a statement.

“This stock is on hold until the litigation is done,” said Kaufman Bros analyst Todd Mitchell.

In a conference call with analysts, the company said it could collect $300 million if it wins the court case.

Chief Executive Tom Rogers said legal costs affected TiVo’s earnings before interest, taxes, depreciation and amortization, which is a measure of cash flow.

“(Legal costs) have increased over last year and it’s not an insignificant amount of the increased EBITDA loss for next quarter,” Rogers said in an interview.

TiVo’s EBITDA in the third quarter was a loss of $18.6 million, compared to a loss of $4.5 million a year earlier.

The company also said it could take a hit of up to $10 million in EBITDA from holiday promotional pricing.

For the holiday season, TiVo has been selling its DVR box for $99, down from $299. Rogers said the reduced price would ultimately help the company’s financials in the long run, since people who opt into that promotion pay $19.99 in monthly fees, up from the regular $12.99.

“It’s got very little downside to it,” Rogers said about the promotion.

Rogers said TiVo is spending more on R&D as part of its new exclusive agreements, such as the partnership it announced in November with Canal Digital, the Scandinavian television distributor.

For the third quarter ended Oct. 31, revenue fell 11 percent to $50.9 million from a year earlier. Analysts on average were expecting revenue of $41.4 million.

The company expects a net loss of $32 million to $34 million for its fiscal fourth quarter.

Shares closed at $8.81 on Nasdaq on Tuesday and were trading at $8.52 after hours.

Reporting by Liana B. Baker. Editing by Robert MacMillan, Bernard Orr

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