TiVo: Good results, but questions remain

TiVo_newDVR specialist TiVo turned in excellent numbers for its Q2 trading period, with revenue just topping $100 million, and about $30 million better than most analysts had expected. TiVo’s subs numbers are also at a record high, at 3.6 million (33 per cent up y-o-y), and even churn (at 1.5 per cent/month) is better than last year’s 1.9 per cent.

So, you might ask, where’s the problem? CEO Tom Rogers talked about the company having reached a very important milestone of sustained net profitability. This comes about, however, not through selling TiVo units, but from a long series of successful litigations which have successfully paid off for TiVo, and converted lawsuits into licensing deals.

“TiVo has reached a brand new chapter in its financial performance that puts the Company on an entirely new trajectory,” added Rogers. He is spot on, but with acquisition costs for each new sub costing an expensive $278 to acquire (compared with $249 last year) Rogers and his team need to start making progress as well as perhaps deciding whether it wants to keep supplying set-top boxes or sit back and enjoy the royalty payments.

“Everyone has been asking that question about TiVo for a decade,” said Rogers, in an interview quoted on NASDAQ. Besides the growth, Rogers said the improvements in TiVo’s financial footing will help the company invest in more research, buy back stock and market its new products.

Rogers also noted that TiVo’s new DVRs, called Roamio, have received good reviews and appear to be on track for strong initial sales. “Apple TV gets a lot of play, Roku gets a lot of play, Sling, Google TV, Chromecast, we look at that and look at the set-top box and look at DVR, we think we’re the only product out there that embraces everything they do in a single solution,” he added.

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