Completed TiVo Acquisition and Entered into a
10-year IP License Agreement with DISH
Announces New IP License Agreement with
Samsung
Made Significant Progress Against Synergy
Targets
TiVo Corporation (NASDAQ:TIVO) today reported financial results
for the third quarter ended September 30, 2016.
The Company reported third quarter revenue of $153.1 million, an
increase of 33% compared to $114.9 million in the third quarter of
2015. As expected, revenues were higher than in the comparable
period of the prior year due to the completion of the TiVo
acquisition and the DISH Network license agreement renewal. Third
quarter 2016 Net income was $49.9 million, compared to a Net loss
of $18.5 million for the third quarter of 2015. Third quarter 2016
Loss from continuing operations before income taxes was $29.0
million, compared to a $14.8 million loss from continuing
operations before income taxes in the third quarter of 2015. Third
quarter 2016 included an $88.1 million income tax benefit due to a
change in the deferred tax asset valuation allowance resulting from
the TiVo acquisition.
On a Non-GAAP basis, third quarter 2016 Non-GAAP Pre-tax Income
was $45.6 million, compared to $28.9 million in the third quarter
of 2015.
Non-GAAP Pre-tax Income is defined below in the section entitled
“Non-GAAP Information.” Reconciliations between GAAP and Non-GAAP
amounts are provided in the tables below.
“Q3 was a transformative quarter,” said Tom Carson, president
and CEO of TiVo. “Rovi acquired TiVo to form the new TiVo, an
entertainment technology leader with a global customer base, robust
intellectual property portfolios, best-in-class product development
capabilities and financial strength. Our combined product offering
saw continued momentum, including Q3 launches of new advanced
search and recommendations services and the TiVo BOLT+ device. We
also renewed our license agreement with DISH Network, further
validating the long-term value and relevance of our intellectual
property portfolios for both traditional and next-generation pay-TV
service providers.”
Mr. Carson continued, “Q4 is off to an excellent start too. I am
also pleased to announce we have agreed to terms for an IP license
arrangement with Samsung. This deal demonstrates that the merger of
Rovi and TiVo offers tremendous synergies and will result in a
stronger combined company that is well positioned to create value
for our stockholders. This agreement with Samsung not only
validates the relevance and longevity of the acquired TiVo
intellectual property, but also highlights our preference for
commercially reasonable deals over on-going litigation. This deal
demonstrates the value that can be created with our IP portfolios
and is a good proof point of revenue synergies resulting from the
combination of Rovi and TiVo. Additionally, we entered into an
early renewal of our Product and Intellectual Property licenses
with Panasonic Corporation. Just as important, the Company is
already operating as one team and our product portfolio integration
efforts are well underway. As a result, we are making significant
progress against our goal of at least $100 million in total cost
synergies. We have already taken actions that will result in over
$40 million in run-rate cost synergies, nearly 50% of our target.
As a result, we are confident we are on track to achieve our
targeted 65% of the total cost synergies in the first twelve
months.”
Subsequent to quarter-end, TiVo’s board readopted, for TiVo
Corporation, the remaining $50.5 million balance of the prior stock
repurchase authorization of Rovi Corporation.
Business Outlook
Following the acquisition of TiVo Inc., TiVo is raising its
estimates and now anticipates fiscal year 2016 revenue of $620
million to $630 million with GAAP (loss) income before taxes of
$(44.2) million to $(37.2) million and Non-GAAP Pre-tax Income of
$185 million to $195 million. TiVo anticipates it will incur $25
million to $27 million in cash taxes based on its 2016 operating
expectations. Both TiVo’s GAAP Diluted weighted average shares
outstanding and Non-GAAP Diluted Weighted Average Shares
Outstanding for the third quarter of 2016 were 92.1 million. For
the fourth quarter, TiVo expects its GAAP diluted weighted average
shares outstanding and Non-GAAP Diluted Weighted Average Shares
Outstanding to be approximately 122.2 million shares. For fiscal
year 2016, TiVo expects its GAAP diluted weighted average shares
outstanding and Non-GAAP Diluted Weighted Average Shares
Outstanding to be approximately 95.2 million shares.
Conference Call Information
TiVo management will host a conference call today, November 3,
2016, at 2:00 p.m. PT/5:00 p.m. ET to discuss the financial
results. Investors and analysts interested in participating in the
conference are welcome to call 1-866-621-1214 (or international
+1-706-643-4013) and reference conference ID 91960016. The
conference call can also be accessed via live webcast in the
Investor Relations section of TiVo's website at
http://www.tivo.com/.
A telephonic replay of the conference call will be available
through November 10, 2016 and can be accessed by calling
1-800-585-8367 (or international +1-404-537-3406) and entering
conference ID 91960016. A replay of the audio webcast will be
available on TiVo Corporation's website shortly after the live call
ends and will remain on TiVo Corporation's website until its next
quarterly earnings call.
Non-GAAP Financial Information
TiVo Corporation provides Non-GAAP information to assist
investors in assessing its operations in the way that its
management evaluates those operations. Non-GAAP Pre-Tax Income,
Non-GAAP Cost of licensing, services and software revenues,
excluding depreciation and amortization of intangible assets,
Non-GAAP Research and Development Expenses, Non-GAAP Selling,
General and Administrative Expenses, Non-GAAP Total OpEx, Non-GAAP
Total COGS and OpEx, and Non-GAAP Interest Expense are supplemental
measures of the Company's performance that are not required by, and
are not determined in accordance with, GAAP. Non-GAAP financial
information is not a substitute for any financial measure
determined in accordance with GAAP.
Non-GAAP Pre-tax Income is defined as GAAP income (loss) from
continuing operations before income taxes, as adjusted for the
effects of items such as equity-based compensation, amortization of
intangible assets, accretion of contingent consideration,
amortization or write-off of note issuance costs and discounts on
convertible debt and mark-to-market adjustments for interest rate
swaps; as well as items which impact comparability that are
required to be recorded under GAAP, but that the Company believes
are not indicative of its core operating results such as
restructuring and asset impairment charges, transaction, transition
and integration costs, retention earn-outs payable to former
shareholders of acquired businesses, changes in the fair value of
contingent consideration and earn-out settlements, gains from the
release of Sonic payroll tax withholding liabilities related to a
stock option review, contested proxy election costs, payments to
note holders and expenses in connection with the extinguishment or
modification of debt, gains on sale of strategic investments and
changes in franchise tax reserves.
Non-GAAP Cost of licensing, services and software revenues,
excluding depreciation and amortization of intangible assets is
defined as GAAP cost of licensing, services and software revenues,
excluding depreciation and amortization of intangible assets,
excluding equity-based compensation and transition and integration
expenses.
Non-GAAP Research and Development Expenses is defined as GAAP
research and development expenses excluding equity-based
compensation, transition and integration expenses and retention
earn-outs payable to former shareholders of acquired
businesses.
Non-GAAP Selling, General and Administrative Expenses is defined
as GAAP selling, general and administrative expenses excluding
equity-based compensation, transaction, transition and integration
expenses, changes in the fair value of contingent consideration and
earn-out settlements, contested proxy election costs and changes in
franchise tax reserves.
Non-GAAP Total OpEx is defined as the sum of GAAP research and
development and selling, general and administrative expenses,
depreciation and gain on sale of patents excluding equity-based
compensation, transaction, transition and integration expenses,
retention earn-outs payable to former shareholders of acquired
businesses, changes in the fair value of contingent consideration
and earn-out settlements, contested proxy election costs and
changes in franchise tax reserves.
Non-GAAP Total COGS and OpEx is defined as GAAP Total Operating
costs and expenses, excluding amortization of intangible assets,
restructuring and asset impairment charges, equity-based
compensation, transaction, transition and integration expenses,
retention earn-outs payable to former shareholders of acquired
businesses, changes in the fair value of contingent consideration
and earn-out settlements, contested proxy election costs, and
changes in franchise tax reserves.
Non-GAAP Interest Expense is defined as GAAP interest expense,
excluding interest on franchise tax reserves, accretion of
contingent consideration, amortization or write-off of issuance
costs and discounts on convertible debt plus the reclassification
of the current period benefit (cost) of the interest rate swaps
from gain (loss) on interest rate swaps.
Cash taxes are defined as GAAP current income tax expense
excluding changes in reserves for unrecognized tax benefits.
Non-GAAP Diluted Weighted Average Shares Outstanding is defined
as GAAP diluted weighted average shares outstanding except for
periods of a GAAP loss. In periods of a GAAP loss, GAAP diluted
weighted average shares outstanding are adjusted to include
dilutive common share equivalents outstanding that were excluded
from GAAP diluted weighted average shares outstanding because the
Company had a loss and therefore these shares would have been
anti-dilutive.
The Company's management evaluates and makes decisions about its
business operations primarily based on Non-GAAP financial
information. Management uses Non-GAAP financial measures as the
basis for decision-making as they exclude items management does not
consider to be “core costs” or “core proceeds”. For each Non-GAAP
financial measure, the adjustment provides management with
information about the Company's underlying operating performance
that enables a more meaningful comparison to its historical and
projected financial performance in different reporting periods. For
example, since the Company does not acquire businesses on a
predictable cycle, management excludes the amortization of
intangible assets, transaction, transition and integration costs,
retention earn-outs payable to former shareholders of acquired
businesses, changes in contingent consideration, and earn-out
settlements from its Non-GAAP financial measures in order to make
more consistent and meaningful evaluations of the Company's
operating expenses as these items may be significantly impacted by
the timing and magnitude of acquisitions. Management also excludes
the effect of restructuring and asset impairment charges, expenses
in connection with the extinguishment or modification of debt and
gains on sale of strategic investments. Management excludes the
impact of equity-based compensation to provide meaningful
supplemental information that allows investors greater visibility
to the underlying performance of our business operations,
facilitates comparison of our results with other periods, and may
facilitate comparison with the results of other companies in our
industry, as well as to provide the Company’s management with an
important tool for financial and operational decision making and
for evaluating the Company’s performance over different periods of
time. Due to varying valuation techniques, reliance on subjective
assumptions and the variety of award types and features that may be
in use, we believe that providing non-GAAP financial measures
excluding equity-based compensation allows investors to make more
meaningful comparisons between our operating results and those of
other companies. Management excludes the amortization or write-off
of note issuance costs and discounts on convertible debt, accretion
of contingent consideration and mark-to-market adjustments for
interest rate swaps when management evaluates the Company's
operating expenses. Management reclassifies the current period
benefit (cost) of the interest rate swaps from gain (loss) on
interest rate swaps to interest expense in order for Non-GAAP
Interest Expense to reflect the effects of the interest rate swaps
as these interest rate swaps were entered into to control the
effective interest rate the Company pays on its debt.
Management uses these Non-GAAP financial measures to help it
make decisions, including decisions that affect operating expenses
and operating margin. Management believes that making Non-GAAP
financial information available to investors, in addition to GAAP
financial information, may facilitate more consistent comparisons
between the Company's performance over time with the performance of
other companies in our industry, which may use similar financial
measures to supplement their GAAP financial information.
Management recognizes that these Non-GAAP financial measures
have limitations as analytical tools, including the fact that
management must exercise judgment in determining which types of
items to exclude from the Non-GAAP financial information. In
addition, as other companies, including companies similar to TiVo
Corporation, may calculate their non-GAAP financial measures
differently than the Company calculates its Non-GAAP financial
measures, these Non-GAAP financial measures may have limited
usefulness to investors when comparing financial performance among
companies. Management believes, however, that providing Non-GAAP
financial information, in addition to GAAP financial information,
facilitates consistent comparison of the Company's financial
performance over time. The Company provides Non-GAAP financial
information to the investment community, not as an alternative, but
as an important supplement to GAAP financial information; to enable
investors to evaluate the Company's core operating performance in
the same way that management does. Reconciliations for each
Non-GAAP financial measure to its most directly comparable GAAP
financial measure is provided in the tables below.
About TiVo Corporation
TiVo (NASDAQ: TIVO) is the global leader in entertainment
technology and audience insights. From the interactive program
guide to the DVR, TiVo delivers innovative products and licensable
technologies that revolutionize how people find content across a
changing media landscape. TiVo enables the world’s leading media
and entertainment providers to deliver the ultimate entertainment
experience. Explore the next generation of entertainment at
tivo.com, forward.tivo.com or follow us on Twitter @tivo or
@tivoforbusiness.
Forward Looking Statements
This release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
These statements relate to, among other things, the Company's
estimates of future financial performance, including future
revenues, earnings and expenses, as well as future business
strategies and future product offerings, deployments and technology
and intellectual property licenses with various named
customers.
These forward-looking statements are based on TiVo’s current
expectations, estimates and projections about its business and
industry, management’s beliefs and certain assumptions made by the
company, all of which are subject to change. Forward-looking
statements generally can be identified by the use of
forward-looking terminology such as, “future”, "believe," "expect,"
"may," "will," "intend," "estimate," "continue," or similar
expressions or the negative of those terms or expressions. Such
statements involve risks and uncertainties, which could cause
actual results to vary materially from those expressed in or
indicated by the forward-looking statements. Factors that may cause
actual results to differ materially include the possibility of TiVo
and Samsung being unable to reach final agreement with respect to
the intellectual property licenses and related terms and conditions
contemplated by, but not yet agreed to as part of, the terms
reached to date between the parties, delays in development,
competitive service offerings and lack of market acceptance, as
well as the other potential factors described under "Risk Factors"
included in TiVo’s most recent report on Form 10-Q and other
documents of TiVo Corporation, Rovi Corporation and TiVo Solutions
Inc. (formerly known as TiVo Inc.) on file with the Securities and
Exchange Commission (available at www.sec.gov). TiVo cautions you
not to place undue reliance on forward-looking statements, which
reflect an analysis only and speak only as of the date hereof. TiVo
assumes no obligation to update any forward-looking statements in
order to reflect events or circumstances that may arise after the
date of this release, except as required by law.
TIVO BUSINESS AND OPERATING
HIGHLIGHTS:
IP Licensing:
- TiVo signed a 10-year patent renewal
license agreement with DISH Network L.L.C., a subsidiary of DISH
Network Corporation. The agreement covers subscribers to DISH’s
traditional and next-generation pay-TV services. In addition, DISH
will continue to license TiVo’s Conversation Services natural
language platform, as well as other TiVo products.
- TiVo has nine of the top 10 U.S. pay TV
service providers under license with seven of those agreements
being signed in the last seven quarters.
Products:
- Over 23 million subscriber households
around the world use TiVo’s advanced television experiences.
- Top-10 North American cable company
signed a multi-year agreement recommitting to the TiVo user
experience including multi-room DVR, non-DVR STB, iOS, Android and
web. In addition, TiVo will help them move to an IP back office
including VOD and linear elements.
- Launched TiVo BOLT+, a best-in-class,
all-in-one, multi-room entertainment device with six tuners and 3TB
of recording capacity for customers looking for the ultimate video
entertainment experience.
- Announced availability of
next-generation user experience that delivers content more quickly
and with less effort from a diverse array of sources.
- CubiTV expanded into Africa by adding
Econet.
- Fan TV now available on Apple TV and
Roku.
- New version of Seamless Insight
released with a new user interface, enhanced multivariate analytics
tools, and improved A/B testing.
- Launched Seamless Discovery Base,
targeted to smaller service providers; selected by a Brazilian
telecommunications company.
- Licensed TiVo’s metadata services to a
major studio to standardize their systems, augment their metadata
and make their content dynamic and discoverable.
- TiVo successfully completed migration
of its customers from previous metadata supplier to TiVo metadata
in four months.
- Launched a new version of Ad Optimizer
and signed a 3-year agreement with one of the largest North
American network families for full portfolio of Ad and Promo
Optimizer.
General Corporate
Developments:
- Closed the acquisition of TiVo Inc. on
September 7th. Q3 includes 23 days of TiVo operations.
- Hired Pete Thompson as COO and EVP.
Based in San Jose, Mr. Thompson brings more than 20 years of
experience in building new businesses and product categories across
a range of industries and technologies.
Subsequent Events:
- Samsung Electronics Co., Ltd. agreed to
the principal terms for a broad long-term intellectual property
license agreement that provides rights under TiVo’s patent
portfolio for Samsung’s leading mobile, consumer electronic and
set-top box businesses. As part of the agreement, the parties will
seek an immediate stay of all pending litigation and patent
challenges between the two companies and, upon satisfaction of
certain conditions in Q4 2016, will seek dismissal thereof.
- Panasonic Corporation, one of the
world’s top consumer electronics manufacturers, renewed its
existing product and intellectual property licenses early.
TIVO CORPORATION AND
SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In
thousands, except per share amounts) (Unaudited)
Three Months Ended September 30, Nine Months Ended
September 30, 2016 2015 2016
2015 Revenues, net: Licensing, services and software $
148,509 $ 114,759 $ 390,998 $ 376,312 Hardware 4,612 123
5,752 415 Total Revenues, net 153,121 114,882
396,750 376,727 Costs and expenses: Cost of licensing, services and
software revenues, excluding depreciation and amortization of
intangible assets 31,661 24,492 78,651 78,134 Cost of hardware
revenues, excluding depreciation and amortization of intangible
assets 4,560 116 5,072 273 Research and development 30,951 22,976
77,804 75,246 Selling, general and administrative 54,126 33,117
132,771 113,843 Depreciation 4,622 4,280 13,181 13,098 Amortization
of intangible assets 24,925 19,189 63,087 57,789 Restructuring and
asset impairment charges 22,311 218 24,644
1,757 Total costs and expenses 173,156 104,388
395,210 340,140 Operating (loss) income from
continuing operations (20,035 ) 10,494 1,540 36,587 Interest
expense (11,021 ) (11,348 ) (32,411 ) (35,421 ) Interest income and
other, net 353 586 322 1,089 Income (loss) on interest rate swaps
1,697 (11,787 ) (16,897 ) (17,106 ) Loss on debt extinguishment —
(2,695 ) — (2,815 ) Loss from continuing operations
before income taxes (29,006 ) (14,750 ) (47,446 ) (17,666 ) Income
tax (benefit) expense (83,445 ) 3,708
(74,825 ) 12,924 Income (loss) from continuing
operations, net of tax 54,439 (18,458 ) 27,379 (30,590 ) Loss from
discontinued operations, net of tax (4,517 ) —
(4,517 ) — Net income (loss) $ 49,922 $
(18,458 ) $ 22,862 $ (30,590 ) Basic earnings (loss)
per share: Continuing operations $ 0.60 $ (0.22 ) $ 0.32 $ (0.36 )
Discontinued operations (0.05 ) — (0.05 ) — Basic
earnings (loss) per share $ 0.55 $ (0.22 ) $ 0.27 $
(0.36 ) Weighted average shares used in computing basic per share
amounts 91,131 82,404 84,895 85,297 Diluted earnings (loss)
per share: Continuing operations $ 0.59 $ (0.22 ) $ 0.32 $ (0.36 )
Discontinued operations (0.05 ) — (0.05 ) — Diluted
earnings (loss) per share $ 0.54 $ (0.22 ) $ 0.27 $
(0.36 ) Weighted average shares used in computing diluted per share
amounts 92,144 82,404 85,858 85,297
See notes to the Condensed Consolidated
Financial Statements in our Quarterly Report on Form 10-Q.
TIVO CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands)
September 30, December 31, 2016
2015 ASSETS (Unaudited) Current assets: Cash and cash
equivalents $ 382,616 $ 101,675 Short-term marketable securities
121,221 107,879 Accounts receivable, net 145,730 87,128 Inventory
14,199 456 Prepaid expenses and other current assets 40,917
13,735 Total current assets 704,683 310,873 Long-term
marketable securities 115,934 114,715 Property and equipment, net
43,514 34,984 Intangible assets, net 849,531 386,742 Goodwill
1,808,623 1,343,652 Other long-term assets 12,191 8,330
Total assets $ 3,534,476 $ 2,199,296
LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities:
Accounts payable and accrued expenses $ 234,714 $ 74,113 Deferred
revenue 45,287 12,106 Current portion of long-term debt 237,000
7,000
Total current liabilities
517,001 93,219 Taxes payable, less current portion 7,055 5,332
Deferred revenue, less current portion 41,732 9,414 Long-term debt,
less current portion 965,733 960,156 Deferred tax liabilities, net
71,560 66,116 Other long-term liabilities 49,453 34,494
Total liabilities 1,652,534 1,168,731 Stockholders' equity:
Common stock 120 131 Treasury stock (4,944 ) (1,163,533 )
Additional paid-in capital 3,254,634 2,419,921 Accumulated other
comprehensive loss (3,374 ) (6,503 ) Accumulated deficit (1,364,494
) (219,451 ) Total stockholders’ equity 1,881,942 1,030,565
Total liabilities and stockholders’ equity $ 3,534,476
$ 2,199,296
See notes to the Condensed Consolidated
Financial Statements in our Quarterly Report on Form 10-Q.
TIVO CORPORATION AND SUBSIDIARIES
REVENUE BY SEGMENT (In thousands) (Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30, 2016
2015 2016 2015 Intellectual Property
Licensing Revenues: Service Provider $ 66,684 $ 45,890 $ 162,791 $
144,344 Consumer Electronics 15,139 11,630 43,011
47,927 Total Intellectual Property Licensing Revenues 81,823
57,520 205,802 192,271 Product Revenues: Service Provider
59,389 48,117 162,480 149,440 Consumer Electronics 9,153 5,825
18,010 16,586 Other 2,756 3,420 10,458 18,430
Total Product Revenues 71,298 57,362 190,948 184,456
Total Revenues $ 153,121 $ 114,882 $
396,750 $ 376,727
TIVO CORPORATION
AND SUBSIDIARIES REVENUE BY SALES VERTICAL (In
thousands) (Unaudited) Three Months Ended
Nine Months Ended September 30, September 30,
2016 2015 2016 2015
Service Provider $ 126,073 $ 94,007 $ 325,271 $ 293,784 Consumer
Electronics 24,292 17,455 61,021 64,513 Other 2,756 3,420
10,458 18,430 Total Revenues $ 153,121 $
114,882 $ 396,750 $ 376,727
TIVO CORPORATION AND
SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP
FINANCIAL INFORMATION
(In thousands)
(Unaudited)
Three Months EndedSeptember
30,
Nine Months EndedSeptember
30,
2016 2015 2016 2015 GAAP
(Loss) income before income taxes $ (29,006 ) $ (14,750 ) $ (47,446
) $ (17,666 ) Amortization of intangible assets 24,925 19,189
63,087 57,789 Restructuring and asset impairment charges 22,311 218
24,644 1,757 Equity-based compensation 13,676 8,328 32,031 31,044
Transaction, transition and integration costs 13,996 — 20,039 —
Earnout amortization and settlement 319 (860 ) 1,508 (860 )
Contested proxy election costs — — — 4,346 Change in franchise tax
reserve — — 154 — Interest on franchise tax reserve — — 280 —
Accretion of contingent consideration 67 — 67 — Amortization of
note issuance costs 499 579 1,468 1,889 Amortization of convertible
note discount 3,035 2,897 9,000 8,573 Mark-to-market loss (income)
related to interest rate swaps (4,252 ) 10,592 9,702 14,039 Loss on
debt extinguishment — 2,695 —
2,815 Non-GAAP Pre-tax Income $ 45,570
$ 28,888 $ 114,534 $ 103,726
Three Months EndedSeptember
30,
Nine Months EndedSeptember
30,
2016 2015 2016 2015 GAAP Weighted
average diluted shares outstanding 92,144 82,404 85,858 85,297
Dilutive effect of equity-based compensation awards —
194 — 432 Non-GAAP
Diluted Weighted Average Shares Outstanding 92,144
82,598 85,858 85,729
Three Months EndedSeptember
30,
Nine Months EndedSeptember
30,
2016 2015 2016 2015 GAAP Total
Operating costs and expenses $ 173,156 $ 104,388 $ 395,210 $
340,140 Amortization of intangible assets (24,925 ) (19,189 )
(63,087 ) (57,789 ) Restructuring and asset impairment charges
(22,311 ) (218 ) (24,644 ) (1,757 ) Equity-based compensation
(13,676 ) (8,328 ) (32,031 ) (31,044 ) Transaction, transition and
integration costs (13,996 ) — (20,039 ) — Earnout amortization and
settlement (319 ) 860 (1,508 ) 860 Contested proxy election costs —
— — (4,346 ) Change in franchise tax reserve —
— (154 ) — Non-GAAP Total COGS and OpEx
$ 97,929 $ 77,513 $ 253,747 $ 246,064
Three Months EndedSeptember
30,
Nine Months EndedSeptember
30,
2016 2015 2016 2015 GAAP Cost of
licensing, services and software revenues, excluding depreciation
and amortization of intangible assets $ 31,661 $ 24,492 $ 78,651 $
78,134 Equity-based compensation (749 ) (1,074 ) (2,814 ) (3,909 )
Transaction, transition and integration costs (136 )
— (136 ) — Non-GAAP Cost of licensing,
services and software revenues, excluding depreciation and
amortization of intangible assets $ 30,776 $ 23,418 $
75,701 $ 74,225
Three Months EndedSeptember
30,
Nine Months EndedSeptember
30,
2016 2015 2016 2015 GAAP Research and
development expenses $ 30,951 $ 22,976 $ 77,804 $ 75,246
Equity-based compensation (3,188 ) (1,584 ) (6,186 ) (5,847 )
Transaction, transition and integration costs (1,508 ) — (1,508 ) —
Earnout amortization and settlement (61 ) —
(61 ) — Non-GAAP Research and Development
Expenses $ 26,194 $ 21,392 $ 70,049 $ 69,399
Three Months EndedSeptember
30,
Nine Months EndedSeptember
30,
2016 2015 2016 2015 GAAP Selling,
general and administrative expenses $ 54,126 $ 33,117 $ 132,771 $
113,843 Equity-based compensation (9,739 ) (5,670 ) (23,031 )
(21,288 ) Transaction, transition and integration costs (12,352 ) —
(18,395 ) — Earnout amortization and settlement (258 ) 860 (1,447 )
860 Contested proxy election costs — — — (4,346 ) Change in
franchise tax reserve — — (154 )
— Non-GAAP Selling, General and Administrative
Expenses $ 31,777 $ 28,307 $ 89,744 $ 89,069
Three Months EndedSeptember
30,
Nine Months EndedSeptember
30,
2016 2015 2016 2015 GAAP Interest
expense $ (11,021 ) $ (11,348 ) $ (32,411 ) $ (35,421 ) Interest on
franchise tax reserve — — 280 — Accretion of contingent
consideration 67 — 67 — Amortization of note issuance costs 499 579
1,468 1,889 Amortization of convertible note discount 3,035 2,897
9,000 8,573 Reclassify current period cost of interest rate swaps
(2,555 ) (1,195 ) (7,195 ) (3,067 )
Non-GAAP Interest Expense $ (9,975 ) $ (9,067 ) $ (28,791 ) $
(28,026 )
TIVO CORPORATION AND
SUBSIDIARIES RECONCILIATION OF GAAP TO NON-GAAP FORECAST
FINANCIAL INFORMATION (In millions) (Unaudited)
Current Full Year Outlook
Prior Full Year Actual
Low High GAAP (Loss) income before income
taxes (1) $ (44.2 ) $ (37.2 ) $ 9.5 Amortization of intangible
assets 105.0 105.0 77.0 Restructuring and asset impairment charges
27.0 28.0 2.2 Equity-based compensation 46.0 47.0 42.6 Transaction,
transition and integration costs 24.0 25.0 — Earnout amortization
and settlement 3.0 3.0 (0.8 ) Mark-to-market loss related to
interest rate swaps 9.7 9.7 8.9 Amortization of note issuance costs
and convertible debt discount 14.0 14.0 13.9 Contested proxy
election costs — — 4.3 Loss on debt extinguishment — — 2.8 Other
0.5 0.5 1.1 Non-GAAP Pre-tax Income $ 185.0
$ 195.0 $ 161.5 Cash
taxes $ 25.0 $ 27.0 $ 17.2 (1) Due to
their nature changes in the mark-to-market of interest rate swaps
have only been included in the outlook to the extent they have
already occurred. Actual results may differ materially from the
outlook.
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version on businesswire.com: http://www.businesswire.com/news/home/20161103006607/en/
Investor ContactsTiVo CorporationPeter Halt,
+1-818-295-6800CFOorTiVo CorporationPeter Ausnit, +1-818-565-5200VP
IRPeter.Ausnit@TiVo.com
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