It has been about a month since the last earnings report for TiVo Corporation . Shares have lost about 12.9% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
TiVo Corp Q4 Earnings Fall Y/Y
Digital home entertainment services and solutions provider, TiVo reported decent fourth-quarter 2016 results, wherein its revenues improved year over year but earnings declined.
The company reported earnings of $0.08 per share from continuing operations compared with $0.32 posted in the year-ago quarter as the benefit from revenue growth was more than offset by higher cost and expenses, increased income tax expenses and higher number of shares outstanding.
It should be noted that TiVo Corporation was formerly known as Rovi Corporation. Upon successfully completing the acquisition of TiVo Inc. in early Sep 2016, Rovi adopted the iconic TiVo brand name.
Hence, it is the second quarterly results of the combined company. Let’s discuss the quarter in detail –
Quarter in Detail
TiVo’s revenues surged 68.7% year over year to $252.3 million mainly due to the inclusion of the first full quarter of TiVo Inc.’s business and revenues from Samsung’s licensing agreement.
The company’s revenues from Licensing, services and software division increased 59.9% year over year to $238.5 million, contributing 95% to total revenue. Hardware division’s revenues grew over thirty-seven times to $13.9 million and contributed 5% to total revenue.
In terms of sales verticals, Service Provider revenues surged 43.6% year over year to $104 million and Consumer Electronics sales were $36.3 million, marking over two-fold year-over-year jump. Platform Solutions revenues increased about 2.5 times year over year to $86 million and Software and Services sales grew 10%. On the contrary, Other vertical’s revenues declined 38% to $2 million.
In terms of business segments, IP Licensing revenues grew 56.7% year over year to $140.4 million and contributed 56% to total revenue. Product revenues increased 86.7% to $112 million, contributing 44% to total revenue.
The company’s total cost of goods sold and expenses increased more than doubled year over year to $232.4 million from $114.4 million in the year-ago quarter. Moreover, as a percentage of total revenue, it expanded 15.6% to 92.1%, mainly due to inclusion of various one-time expenses related to the merger.
TiVo’s net income from continuing operations declined 62.4% year over year to $9.9 million, mainly due to higher cost and expenses along with increased income tax expenses.
TiVo exited the quarter with cash, cash equivalents and short-term investments of $309.7 million compared with $503.8 million at the end of previous quarter.
Outlook
Upon successful completion of the acquisition of TiVo Inc., the new company anticipates to generate revenues in a range of $800 million to $835 million (mid-point $817.5 million) in 2017. It further projects GAAP loss before taxes of $55 million to $70 million and non-GAAP pre-tax Income of $200 million to $225 million.
(Note: The EPS data mentioned in the text of this section differs from the rest of report due to the difference in calculation or consideration of one-time items.)
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last one month period as none of them issued any earnings estimate revisions.
VGM Scores
At this time, TiVo Corp's stock has a poor Growth Score of 'F', however its Momentum is doing a lot better with a 'B'. The stock was allocated also a grade of 'D' on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'F'. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is suitable solely for momentum investors.
Outlook
The stock has a Zacks Rank #5 (Strong Sell). We are expecting a below average return from the stock in the next few months.
Image: Bigstock
Why Is TiVo Corp (TIVO) Down 12.9% Since the Last Earnings Report?
It has been about a month since the last earnings report for TiVo Corporation . Shares have lost about 12.9% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
TiVo Corp Q4 Earnings Fall Y/Y
Digital home entertainment services and solutions provider, TiVo reported decent fourth-quarter 2016 results, wherein its revenues improved year over year but earnings declined.
The company reported earnings of $0.08 per share from continuing operations compared with $0.32 posted in the year-ago quarter as the benefit from revenue growth was more than offset by higher cost and expenses, increased income tax expenses and higher number of shares outstanding.
It should be noted that TiVo Corporation was formerly known as Rovi Corporation. Upon successfully completing the acquisition of TiVo Inc. in early Sep 2016, Rovi adopted the iconic TiVo brand name.
Hence, it is the second quarterly results of the combined company. Let’s discuss the quarter in detail –
Quarter in Detail
TiVo’s revenues surged 68.7% year over year to $252.3 million mainly due to the inclusion of the first full quarter of TiVo Inc.’s business and revenues from Samsung’s licensing agreement.
The company’s revenues from Licensing, services and software division increased 59.9% year over year to $238.5 million, contributing 95% to total revenue. Hardware division’s revenues grew over thirty-seven times to $13.9 million and contributed 5% to total revenue.
In terms of sales verticals, Service Provider revenues surged 43.6% year over year to $104 million and Consumer Electronics sales were $36.3 million, marking over two-fold year-over-year jump. Platform Solutions revenues increased about 2.5 times year over year to $86 million and Software and Services sales grew 10%. On the contrary, Other vertical’s revenues declined 38% to $2 million.
In terms of business segments, IP Licensing revenues grew 56.7% year over year to $140.4 million and contributed 56% to total revenue. Product revenues increased 86.7% to $112 million, contributing 44% to total revenue.
The company’s total cost of goods sold and expenses increased more than doubled year over year to $232.4 million from $114.4 million in the year-ago quarter. Moreover, as a percentage of total revenue, it expanded 15.6% to 92.1%, mainly due to inclusion of various one-time expenses related to the merger.
TiVo’s net income from continuing operations declined 62.4% year over year to $9.9 million, mainly due to higher cost and expenses along with increased income tax expenses.
TiVo exited the quarter with cash, cash equivalents and short-term investments of $309.7 million compared with $503.8 million at the end of previous quarter.
Outlook
Upon successful completion of the acquisition of TiVo Inc., the new company anticipates to generate revenues in a range of $800 million to $835 million (mid-point $817.5 million) in 2017. It further projects GAAP loss before taxes of $55 million to $70 million and non-GAAP pre-tax Income of $200 million to $225 million.
(Note: The EPS data mentioned in the text of this section differs from the rest of report due to the difference in calculation or consideration of one-time items.)
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last one month period as none of them issued any earnings estimate revisions.
TiVo Corporation Price and Consensus
TiVo Corporation Price and Consensus | TiVo Corporation Quote
VGM Scores
At this time, TiVo Corp's stock has a poor Growth Score of 'F', however its Momentum is doing a lot better with a 'B'. The stock was allocated also a grade of 'D' on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'F'. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is suitable solely for momentum investors.
Outlook
The stock has a Zacks Rank #5 (Strong Sell). We are expecting a below average return from the stock in the next few months.