TiVo sees gains as it widens its focus
TiVo Inc. has been thinking outside the box.
The Alviso, Calif.-based maker of digital video recorders said Wednesday that efforts to broaden its focus led to a decline in sales but a narrower fourth-quarter loss.
TiVo lost $6.4 million, or 6 cents a share, on $74.1 million in revenue in the quarter that ended Jan. 31. It lost $19.5 million, or 20 cents, a year earlier. Analysts polled by Thomson Financial had expected a loss of $10.2 million, or 11 cents a share.
The set-top box maker has spent two years diving into a wide array of businesses, including licensing its technology to cable companies, facilitating movie and music downloads, selling interactive TV ads and providing research on whether those ads are being watched.
Meanwhile, TiVo reined in marketing expenses and stopped giving away boxes and selling them at a loss. As a result, TiVo ended its fiscal year with 3.9 million subscribers who generate monthly fees, compared with 4.4 million last year.
That didn’t seem to worry investors. TiVo’s stock, which gained 11 cents to $8.14 before the earnings release, shot up 31 cents in extended trading.
Many TiVo shareholders are banking on the company’s expansion strategy, Bear Stearns & Co. analyst Kunal Madhukar said.
“TiVo’s starting from scratch,” Madhukar said. “It takes time to build momentum.”
This year, TiVo expects to see a jump in subscribers, thanks to partnerships with Comcast Corp. and Cox Communications Inc. to market TiVo’s service to their customers.
TiVo on Wednesday added advertising conglomerate Omnicom Media Group to the list of customers who are paying for second-by-second data on what TV viewers are watching. Other customers of the service include Interpublic Group, Starcom USA, Carat USA, NBC Universal and CBS.
“We not only add a way to watch TV, but we also add a way to measure it,” TiVo Chief Executive Tom Rogers said.
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