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TiVo Inc. (TIVO - Analyst Report) is scheduled to release its fiscal second quarter 2013 results after market closes on August 29, 2012. In the run up to the earnings release we do not notice any movement in the analysts’ estimates.

Previous Quarter Highlights

TiVo reported mixed first quarter 2013 results. Top line increased 48.1% from the year-ago quarter to $67.8 million, which also beat the Zacks Consensus Estimate of $64.0 million. The top line was positively impacted by improved revenues from the Service and Technology and Hardware revenue. Moreover, net subscriber additions during the quarter also benefited the top line.

However, the company reported a loss of 17 cents per share, wider than the Zacks Consensus Estimate of a loss of 15 cents.

For the second quarter of 2013, TiVo expects Service and Technology revenues in the range of $53 million to $55 million. TiVo expects net loss in the range of $28.0 million to $30.0 million and an adjusted EBITDA loss in the range of $16.0 million to $18.0 million.

For further details please read: TiVo Reports Mixed 1Q

Earnings Estimates Trend

Over the past 30 days, none of the 12 analysts covering the stock revised their estimates in either direction. Thus, the Zacks Consensus Estimate for the second quarter remained at a loss of 23 cents.

Analysts covering the stock expect a moderate rise in revenues for the quarter as partnerships with Virgin Media Inc. , ONO, RCN and Charter boost its subscriber base. However, higher expenses relating to research & development and legal expenses may hurt the operational results for the quarter.

Recommendation

We remain optimistic about TiVo’s long-term growth potential due to new partnerships, product launches and international expansion. We believe that TiVo will continue to witness strong subscriber growth based on its partnerships with Virgin Media Inc. Comcast Corp. (CMCSK - Snapshot Report), Suddenlink, DIRECTV and few others going forward.

However, pending patent litigation issues, rising subscription acquisition costs, higher hardware and sales & marketing costs are expected to impact TiVo’s profitability over the next few quarters. Increasing competition from cable and satellite providers could also hurt profitability over the long term. Thus, we have a Neutral recommendation on TiVo over the long term (6-12 months).

Currently, TiVo has a Zacks #3 Rank, which implies a short-term Hold rating (1-3 months).

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