Form 8-K

-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, PLxlPe0Y1pGxFXtMp5FxEltZ/4usDF2nxMWcuKpen+/b1+LBJ56JP2S/ZNVWKwNC 2lYSiPIQZ/KHt+1awWwU4A== 0001193125-06-243827.txt : 20061129 0001193125-06-243827.hdr.sgml : 20061129 20061129165713 ACCESSION NUMBER: 0001193125-06-243827 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20061129 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20061129 DATE AS OF CHANGE: 20061129 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TIVO INC CENTRAL INDEX KEY: 0001088825 STANDARD INDUSTRIAL CLASSIFICATION: CABLE & OTHER PAY TELEVISION SERVICES [4841] IRS NUMBER: 770463167 STATE OF INCORPORATION: DE FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-27141 FILM NUMBER: 061245959 BUSINESS ADDRESS: STREET 1: 2160 GOLD STREET STREET 2: PO BOX 2160 CITY: ALVISO STATE: CA ZIP: 95002 BUSINESS PHONE: 408-519-9100 MAIL ADDRESS: STREET 1: 2160 GOLD STREET STREET 2: PO BOX 2160 CITY: ALVISO STATE: CA ZIP: 95002 8-K 1 d8k.htm FORM 8-K Form 8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) November 29, 2006

TIVO INC.

(Exact name of registrant as specified in its charter)

Delaware

000-27141

77-0463167

(State or other jurisdiction

of incorporation)

(Commission File Number)

(IRS Employer

Identification No.)

2160 Gold Street,

Alviso, California

95002

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code (408)519-9100

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

On November 29, 2006, TiVo Inc. issued a press release announcing its financial results for the third quarter ended October 31, 2006 and released FY07 Q3 Key Financial Metric Trend Sheets for TiVo Inc.’s third quarter earnings conference call. A copy of the press release is furnished as Exhibit 99.1 to this Current Report and a copy of the FY07 Q3 Key Financial Metric Trend Sheets are furnished as Exhibit 99.2 to this Current Report.

This information and the information contained in the press release and FY07 Q3 Key Financial Metric Trend Sheets for TiVo Inc. (and attached reconciliations and related notes) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information in this Current Report is not incorporated by reference into any filings of the Company made under the Securities Act of 1933, as amended, whether made before or after the date of this Current Report, regardless of any general incorporation language in the filing unless specifically stated so therein.

ITEM 9.01.

FINANCIAL STATEMENTS AND EXHIBITS.

(d)

Exhibits


Exhibit Number		Description
99.1		Press Release of TiVo Inc. dated November 29, 2006.

99.2		FY07 Q3 Key Financial Metric Trend Sheets and Reconciliations and Related Notes for TiVo Inc., dated November 29, 2006.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.


	TIVO INC.

Date: November 29, 2006	By:	/s/ Steven Sordello
		Steven Sordello
		Senior Vice President and
		Chief Financial Officer
		(Principal Financial and Accounting Officer)

EXHIBIT INDEX


Exhibit Number		Description
99.1		Press Release of TiVo Inc. dated November 29, 2006.

99.2		FY07 Q3 Key Financial Metric Trend Sheets and Reconciliations and Related Notes for TiVo Inc., dated November 29, 2006.

EX-99.1 2 dex991.htm PRESS RELEASE Press Release

Exhibit 99.1


Contacts:	Investor Relations	Media Relations
	Derrick Nueman	Jeffrey Weir – Sloane & Company
	408-519-9677	212-446-1878
	ir@tivo.com	jweir@sloanepr.com

TiVo Announces Third Quarter Results

•

Deal with Cablevisión Mexico enables distribution of TiVo Service through the largest cable operator in Mexico City

•

TiVo-Owned subscription gross additions increased 10% year-over-year, the first year-over-year increase in six quarters

•

Cumulative TiVo-Owned subscriptions increased 317,000, or 24% year-over-year

•

Introduced several new features for distributing Broadband content to the television

•

Launched TiVo^® Series3^™ High Definition Digital Media Recorder

ALVISO, Calif. – November 29, 2006 – TiVo Inc. (NASDAQ: TIVO), the creator of and a leader in television services for digital video recorders (DVRs), today reported financial results for its quarter ended October 31, 2006.

Tom Rogers, CEO of TiVo said, “Our strategy remains clear: to drive our standing as the only branded and truly differentiated DVR in the world. In the third quarter, we continued to make progress towards that goal and our results reflected our efforts as gross subscription addition growth was positive for the first time on a year-over-year basis in six quarters. We accelerated the pace of our feature introductions, specifically in broadband distribution, bringing the rapidly expanding array of video content on the Internet into the living room. We are turning the best way to watch television into the best way to get more television, content and programming, representing phenomenal choice and total ease for the viewer. The advertising and promotion that we are implementing will for the first time be about making clear that TiVo is very different from the generic alternatives with the phrase ’It’s not a TiVo unless it’s a TiVo.’ We launched our TiVo Series3 High Definition Digital Media Recorder, which reaffirmed our DVR leadership and provided consumers with the only true high-end DVR option in the market. Finally, our critically important distribution program with Comcast, the nation’s leading cable television provider is progressing well.”

Service and technology revenues for the quarter increased 22% to $52.6 million, compared with $43.2 million for the same period last year. TiVo reported a net loss of ($11.1) million and net loss per share of ($0.12), compared to a net loss of ($14.2) million, or ($0.17) per share, for the third quarter of last year.

“Given our efforts to differentiate TiVo, we are pleased that we were able to build momentum relative to last year, with TiVo-Owned subscription gross addition growth up 10% at 101,000 compared to 92,000 in the third quarter of last year,” said Rogers.

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Overall TiVo-Owned subscriptions were up 24% year-over-year to 1.6 million. As expected, TiVo reported a net decline in the number of DIRECTV TiVo subscriptions during the period as DIRECTV deployed fewer TiVo boxes. Cumulative total subscriptions as of October 31, 2006, were up slightly from last quarter to 4.4 million, and up 11% over the year-ago subscription totals.

Rogers added, “On the sales and marketing front, we continued to see strong results from our online channel, which we believe are directly attributable to the compelling pricing changes we made in the first quarter of this year and our ability to leverage results from this very efficient sales channel. Online sales increased sequentially as a percentage of total sales from 33% last quarter to 43% this quarter.

“As of November 5th, we introduced new hardware pricing available at all retail stores that provide, the single-tuner hardware free after mail-in rebate and for a reduced fee after mail-in rebate for the dual-tuner hardware. At the same time, we have created uniform subscription pricing across online and retail store customers to enable us to nationally advertise in print, radio and television, which began in mid-November. This approach provides us with an opportunity to reduce inventories on the single-tuner box, a product on which we will not put much focus on in the future. Following the holiday period, we will be evaluating the success generated by this kind of hardware pricing approach versus an approach where there is less reliance on rebates and a greater emphasis placed on advertising the TiVo product.

“The introduction of the TiVo Series3 High Definition Digital Media Recorder – the first stand-alone TiVo product that is HD compatible – is an important step for TiVo. While still in the early days, we have received positive consumer feedback on the product, with Series3 sales meeting our expectations. At the same time, the TiVo Series2™ Dual-Tuner box, which we launched in the second quarter, represented approximately 58% of all sales, highlighting the continued popularity of this product. And while TiVo is focused on the cutting edge of the newest technologies, we continue to serve a very important analog cable customer. In the quarter, approximately 47% of our TiVo-Owned subscriptions came from this market, where we remain the only DVR solution for these customers.

“Over the course of the quarter, TiVo continued to develop and deploy new features that further differentiate the TiVo service from its generic competition. Specifically, our broadband strategy is enabling us to take full advantage of the explosion in growth of video content on the Web. TiVo is the only DVR and in-home consumer electronic device available today that makes watching broadband video content on TV easy, whether it is exclusive content provided by the likes of CBS or the NBA, home movies, or non-rights protected internet content.

“As part of this initiative, we made available the new software, TiVo Desktop Plus 2.4, which allows our subscribers to easily browse, transfer, and watch a variety of Web video downloads using the TiVo service, even if the content is not originally in a format that televisions can display. These announcements, along with the addition of new TiVoCast partners and the new Home Movies service, are just a few of the features that TiVo has made available over the last year that dramatically enhances the entertainment experience of our subscribers who have a broadband connection, by making web video real TV.

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“In addition to the deals that TiVo has with satellite and cable providers, we have also secured deals with advertisers, ad agencies, magazines, consumer television watchdog groups and programmers - all of which show we have made major strides weaving our way into the fabric of the media industry. Our recent announcement with International Creative Management, one of the world’s largest talent agencies, representing many of the top artists in the entertainment industry, illustrates how TiVo is seen as a unique means by which celebrity brand names can create a direct relationship with viewers, increasing the ease with which consumers can find and discover their favorite options for television viewing while also giving talent a way to expand their business opportunities. We continue to be focused on additional ways to make TiVo an essential ingredient of the strategic future of all parts of the media industry.

“Regarding distribution, we are pleased to announce that we have entered into an international distribution agreement with Cablevisión Mexico, the largest cable operator in Mexico City which is owned by Televisa – the country’s dominant broadcast company. Our confidence that there are many significant international opportunities for TiVo distribution is steadily growing, and we believe you should begin to define the relevant market for TiVo as being well beyond the US alone.

“On the advertising front, we remain the only interactive solution dedicated to DVR viewing. First, we announced yesterday that we are introducing a new advertising product, Program Placement, which gives advertisers the ability to offer an ad at the end of a television show when consumers are asked if they want to save or delete a program, providing a whole new link to longer form material. We have developed various other forms of new inventory that provide advertisers with a way to engage with viewers as they navigate through the TiVo interface or fast forward through ads. Additionally, we signed this quarter yet another agency-wide advertising agreement with WPP’s GroupM network of agencies, (MediaCom, Mediaedge:cia, and MindShare) further demonstrating the value of TiVo’s unique advertising solutions for advertisers. Though it is still in the early stages, we continued to be very excited about the potential of our advertising business. In the ARM business, we took innovative steps to help advertisers analyze and measure the effectiveness of their campaigns with our unique audience measurement data, launching a product this quarter with IRI that combines DVR viewing behavior with purchase data in DVR households.”

Management Provides Financial Guidance

For the fourth quarter of fiscal 2007, TiVo anticipates service and technology revenues in the range of $54 million to $55 million, an Adjusted EBITDA loss of $28 to $33 million and a net loss of $33 million to $38 million. The larger net loss is a function of the increased hardware rebate across retail store offerings, which represent not only the greater volume of sales due to the holidays, but retail store sales are a higher proportion of overall sales in the fourth quarter.

This financial guidance is based on information available to management as of November 29, 2006. TiVo expressly disclaims any duty to update this guidance.

-3-

Management’s guidance includes Adjusted EBITDA, a non-GAAP financial measure as defined in Regulation G. TiVo has provided a reconciliation of EBITDA and Adjusted EBITDA to net loss in the attached schedules solely for the purpose of complying with Regulation G and not as an indication that EBITDA or Adjusted EBITDA is a substitute measure for net loss.

Conference Call and Webcast

TiVo will host a conference call and webcast to discuss the fiscal third quarter 2007 financial and operating results and guidance outlook at 2:00 pm PT (5:00 pm ET), today, November 29, 2006. To listen to the discussion, please visit www.tivo.com/ir and click on the link provided for the webcast or dial (888) 802-2280 no password required. The webcast will be archived and available through December 7, 2006 at www.tivo.com/ir or by calling (719) 457-0820 and entering the conference ID number 7492034.

Recent Highlights

TiVo Launches New Advertising Solution; “Program Placement”

TiVo announced Program Placement, its latest advertising solution that offers advertisers an opportunity, through the TiVo Service, to insert an ad after a program has played, when there is nothing left to fast forward through. For the first time, advertisers will be able to reach their target DVR audience by purchasing advertising enhancements against specific shows. Burger King Corporation, General Motors Corp., MasterCard Worldwide, The Weather Channel and Court TV are the first companies to take advantage of Program Placement on TiVo. Leading media and advertising agencies, including GroupM’s MindShare, Norwalk, CT-based Media Storm and GSD&M, worked with TiVo to have their clients be the first to use this revolutionary advertising solution. TiVo’s Program Placement is designed to provide a solution for advertisers confronted with the need to reach viewers in DVR homes. Program Placement advertising, inserted at the end of a recorded program for the viewer who chooses to watch it, can be matched to multiple programs, television series and genres.

TiVo Announces Comprehensive Broadband Video Delivery Approach

In keeping with its mission to provide consumers with the ultimate television viewing experience, TiVo unveiled a comprehensive broadband strategy designed to put even more control in the hands of consumers by greatly expanding their television choices, taking the concept that “It’s not TV unless it’s on the TV” to a whole new level. TiVo continues to innovate and lead the category by empowering consumers to select their own content and bring it from the Internet to their TV, where they can enjoy it from the comfort of their living room. TiVo released five major announcements, demonstrating how TiVo will allow consumers to get broadband delivered video right to their TV set. TiVo is the first and only DVR to offer this kind of access to broadband video on the television set.

TiVo Allows Viewers to Choose Broadband Video Delivered to TV Set

TiVo announced it will enable TiVo subscribers to easily convert and transfer broadband video from their PC to their television sets. Through an expansion of its Desktop PC software later this year, TiVo subscribers will be able to view videos from the Web on their TVs, even if they are not originally in a format that televisions can display. This is in addition to the broadband programming delivered via TiVo’s TiVoCast direct delivery feature.

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TiVo Introduces New Service Feature that Allows Home Movies to be Sent Over the Internet Directly to Television Sets

TiVo announced that it will debut a break-through new service early next year which will provide friends and families scattered across the country with an easy way to share their home videos, by sending them directly to the television. Rather than burning and mailing DVDs, or viewing videos uploaded on a computer, friends and family will now be able to set-up their own private channel to send home videos directly to a TiVo subscriber’s TV set. TiVo partnered with One True Media, an online service that helps people easily turn their video and photos into online video stories, to create a comprehensive, end-to-end solution for the person who took the home movies and to whomever he or she would like to show them.

TiVo Announces Partnership with Talent and Literary Agency International Creative Management

TiVo announced a first-of-its-kind multi-faceted partnership with International Creative Management’s global branded entertainment division. One of the world’s leading talent and literary agencies, ICM will provide TiVo subscribers with TV show and film recommendations personally selected by some of the most well-known Hollywood actors and directors. Subscribers will then have the ability to have this content automatically recorded on their TiVo boxes. As part of this agreement, TiVo and ICM will work to develop a host of additional applications.

TiVo Signs on CBS Interactive as First Network Content Partner in TiVoCast

TiVo announced that it signed CBS Interactive to deliver original programming created for the Web directly to television through the TiVoCast service. Additionally, TiVo signed on a list of other partners to deliver broadband content to the television including Reuters, Forbes, dLife, Plum TV and Nano. Launched earlier this year, the TiVoCast service brings a whole new line-up of content to the television by offering broadband video previously found only on the Web and not widely available on TV. CBS Interactive is the first network deal for TiVoCast. The content will consist of original programming from CBS's online destinations including CBS.com, CBS's broadband channel innertube, CBSNews.com and CBS SportsLine.

TiVo Debuts Revolutionary Series3 High Definition Digital Media Recorder

TiVo launched the high end TiVo Series3 HD Digital Media Recorder – the first stand-alone TiVo product that is HD compatible. The TiVo Series3 HD box is the world’s first THX^{^®}-certified, digital video recorder, delivering audio and video that truly maintains the fidelity of the original broadcast.

TiVo Makes History with First-Ever Exclusive Debut, Before Its Network Premiere, of New Fall Show from CBS

TiVo partnered with CBS Television to launch a new Fall show in an entirely original way — not via a network premiere, a DVD or the Internet, but on the TiVo service. Through this pioneering partnership, TiVo subscribers were the first in the nation to see the hot comedy CBS show “The Class” as early as a full week before its premiere on live TV. In this innovative launch

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developed jointly by TiVo and CBS, TiVo subscribers had an unparalleled opportunity to experience CBS fall line-up exclusives. This marked the first time that any group of network shows have ever been bundled together and offered jointly for the ultimate in viewer convenience.

TiVo Teams Up With CBS SportsLine Fantasy Football

TiVo and CBS SportsLine launched the availability of CBS SportsLine Fantasy Football Companion from any television connected to a broadband-enabled TiVo Series2 DVR. Registered users of CBS SportsLine Fantasy Football manage their leagues, check stats and scores, and watch highlights from the comfort of their living rooms with their TiVo remote control. CBS SportsLine and TiVo are creating a new form of interactive sports programming for subscribers.

TiVo's Online Scheduling Service Featured on Gemstar-TV Guide’s TVGUIDE.COM

TiVo entered into an agreement with Gemstar-TV Guide enabling TVGuide.com to offer TiVo’s Online Scheduling to its dedicated group of TV enthusiast users. The new online scheduling feature, scheduled to debut in early 2007, will provide TVGuide.com users a simple way to request, via TiVo’s scheduling technology, recordings of their favorite TV shows on their TiVo Series2 device from anywhere they access TVGuide.com.

TiVo and Information Resources Inc. Launch Groundbreaking TV Advertising Research Services

TiVo and Information Resources, Inc. (IRI) launched the IRI TiVo Consumer Insights Suite^™, comprised of two new services, providing advertisers and brand marketers with the ability to fully understand the impact digital video recorder (DVR) technology has on consumer viewing patterns and subsequent product sales, as well as the ability to quantify the effectiveness of specific advertising campaigns and brand recognition programs in TiVo DVR households. Additionally, TiVo and IRI expanded their existing relationship. Utilizing second-by-second analysis and tracking it to actual consumer purchasing decisions, the expanded relationship provides first-of- its-kind viewer and consumer insights from a new national DVR research panel combined with new media and message testing capabilities to fully understand and better leverage the evolving impact of DVRs.

WPP’S GroupM Signs Agency-Wide Advertising Agreement With TiVo

TiVo and WPP's GroupM network of agencies, MediaCom, Mediaedge:cia, and MindShare, committed to purchase an agreed upon minimum amount of TiVo advertising. GroupM, one of the world's leading full service media investment management operation, signed the agency-wide advertising and research agreement to help its clients better engage their target audience.

About TiVo Inc.

Founded in 1997, TiVo (NASDAQ: TIVO) pioneered a brand new category of products with the development of the first commercially available digital video recorder (DVR). Sold through leading consumer electronic retailers, TiVo has developed a brand which resonates boldly with consumers as providing a superior television experience. Through agreements with leading satellite and cable providers, TiVo also integrates its full set of DVR service features into the set-top

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boxes of mass distributors. TiVo's DVR functionality and ease of use, with such features as Season Pass^™ recordings and WishList^® searches, has elevated its popularity among consumers and has created a whole new way for viewers to watch television. With a continued investment in its patented technologies, TiVo is revolutionizing the way consumers watch and access home entertainment. Rapidly becoming the focal point of the digital living room, TiVo’s DVR is at the center of experiencing new forms of content on the TV, such as broadband delivered video, music and photos. With innovative features, such as TiVoToGo™ and online scheduling, TiVo is expanding the notion of consumers experiencing “TiVo, TV your way.^®” The TiVo^® service is also at the forefront of providing innovative marketing solutions for the television industry, including a unique platform for advertisers and audience measurement research. The Company is based in Alviso, California.

TiVo, Guru Guide, Season Pass, WishList, Series2, Series3, TiVoToGo, ‘TiVo, TV your way.’ and the TiVo Logo are trademarks or registered trademarks of TiVo Inc. worldwide. ^© 2006 TiVo Inc. All rights reserved.

This release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to, among other things, TiVo’s business, services, financial statements, future product strategy, and financial performance. Forward-looking statements generally can be identified by the use of forward-looking terminology such as, “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 delays in development, competitive service offerings and lack of market acceptance, as well as the other potential factors described under “Risk Factors” in the Company’s public reports filed with the Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2006, the Quarterly Reports on Form 10-Q for the fiscal quarters ended April 30, 2006 and July 31, 2006 and Current Reports on Form 8-K. The Company 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 disclaims any obligation to update these forward-looking statements.

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TIVO INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(unaudited)


	Three Months Ended October 31,						Nine Months Ended October 31,
	2006			2005			2006			2005
				Adjusted						Adjusted
Service revenues	$	49,000		$	42,296		$	145,381		$	120,889
Technology revenues		3,616			901			15,224			3,002

Service and Technology revenues		52,616			43,197			160,605			123,891

Hardware revenues		27,978			24,652			53,666			39,827
Rebates, revenue share, and other payments to channel		(14,934	)		(18,234	)		(32,932	)		(27,860	)

Net revenues		65,660			49,615			181,339			135,858

Cost of service revenues ⁽¹⁾		10,820			8,431			30,883			23,929
Cost of technology revenues ⁽¹⁾		3,006			77			13,373			903
Cost of hardware revenues		31,925			24,667			68,678			48,006

Gross margin		19,909			16,440			68,405			63,020

Research and development ⁽¹⁾		12,221			9,712			37,973			30,394
Sales and marketing ⁽¹⁾		10,123			10,006			25,856			24,410
General and administrative⁽¹⁾		9,811			11,702			35,961			26,249

Loss from operations		(12,246	)		(14,980	)		(31,385	)		(18,033	)

Interest and other income (expense), net		1,158			816			3,176			2,171
Provision for taxes		(4	)		—			(35	)		(51	)

Net loss attributable to common stockholders	$	(11,092	)	$	(14,164	)	$	(28,244	)	$	(15,913	)

Net loss per common share - basic and diluted	$	(0.12	)	$	(0.17	)	$	(0.32	)	$	(0.19	)

Weighted average common shares used to calculate basic and diluted net loss per share		91,930			84,201			87,681			83,362

(1) Includes stock-based compensation expense (benefit) as follows (FY 2007 increases are due primarily to the adoption of FAS 123(R))

Cost of service revenues	$	129		$	—		$	353		$	—
Cost of technology revenues		236			—			682			—
Research and development		1,608			(6	)		4,177			(131	)
Sales and marketing		474			20			1,264			(20	)
General and administrative		1,636			151			4,257			199

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TIVO INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share amounts)

(unaudited)


	October 31, 2006			January 31, 2006
				Adjusted
ASSETS
CURRENT ASSETS
Cash and cash equivalents, and short-term investments	$	106,965		$	104,213
Accounts receivable		27,300			20,111
Finished goods inventories		34,107			10,939
Prepaid expenses and other, current		4,327			8,744

Total current assets		172,699			144,007

LONG-TERM ASSETS
Property and equipment, net		10,874			9,448
Purchased technology, capitalized software, and intangible assets, net		17,580			5,206
Prepaid expenses and other, long-term		597			347

Total long-term assets		29,051			15,001

Total assets	$	201,750		$	159,008

LIABILITIES AND STOCKHOLDERS’ DEFICIT
LIABILITIES
CURRENT LIABILITIES
Accounts payable	$	28,278		$	24,050
Accrued liabilities		32,553			37,449
Deferred revenue, current		56,596			57,902

Total current liabilities		117,427			119,401

LONG-TERM LIABILITIES
Deferred revenue, long-term		51,550			67,575
Deferred rent and other		2,208			1,404

Total long-term liabilities		53,758			68,979

Total liabilities		171,185			188,380
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ DEFICIT
Preferred stock, par value $0.001:
Authorized shares are 10,000,000
Issued and outstanding shares - none
Common stock, par value $0.001:		—			—
Authorized shares are 150,000,000
Issued and outstanding shares are 96,761,289 and 85,376,191, respectively		97			85
Additional paid-in capital		752,803			667,055
Deferred compensation		—			(2,421	)
Accumulated deficit		(722,335	)		(694,091	)

Total stockholders’ deficit		30,565			(29,372	)

Total liabilities and stockholders’ deficit	$	201,750		$	159,008

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TIVO INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(unaudited)


	Nine Months Ended October 31,
	2006			2005
CASH FLOWS FROM OPERATING ACTIVITIES					Adjusted
Net loss	$	(28,244	)	$	(15,913	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization of property and equipment and intangibles		5,815			4,591
Recognition of stock-based compensation expense (benefit)		10,733			48
Changes in assets and liabilities:
Accounts receivable, net		(7,189	)		(3,713	)
Finished goods inventories		(23,168	)		(9,079	)
Prepaid expenses and other		4,167			(2,000	)
Accounts payable		3,853			16,111
Accrued liabilities		(4,652	)		(2,627	)
Deferred revenue		(17,331	)		613
Deferred rent and other long-term liabilities		804			(293	)

Net cash used in operating activities	$	(55,212	)	$	(12,262	)

CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of short-term investments		(13,502	)		(5,375	)
Sales of short-term investments		4,350			10,625
Acquisition of property and equipment		(6,115	)		(3,897	)
Acquisition of capitalized software and intangibles		(13,125	)		(3,915	)

Net cash used in investing activities	$	(28,392	)	$	(2,562	)

CASH FLOWS FROM FINANCING ACTIVITIES
Borrowing under bank line of credit		—			3,500
Payments to bank line of credit		—			(8,000	)
Proceeds from issuance of common stock		65,000			—
Payment of issuance costs for common stock		(1,054	)		—
Proceeds from issuance of common stock related to exercise of warrants		3,329			—
Proceeds from issuance of common stock related to employee stock purchase plan		8,639			6,443
Proceeds from issuance of common stock related to exercise of common stock options		1,290			2,242

Net cash provided by financing activities	$	77,204		$	4,185

NET DECREASE IN CASH AND CASH EQUIVALENTS	$	(6,400	)	$	(10,639	)

-10-

TIVO INC.

OTHER DATA


	Three Months Ended October 31,						Nine Months Ended October 31,
	2006			2005			2006			2005
Net loss	$	(11,092	)	$	(14,164	)	$	(28,244	)	$	(15,913	)
Add back:
Depreciation & amortization		2,219			1,609			5,816			4,656
Interest income & expense		(1,246	)		(816	)		(3,293	)		(2,171	)
Provision for income tax		4			—			35			51

EBITDA		(10,115	)		(13,371	)		(25,686	)		(13,377	)
Stock-based compensation		4,083			165			10,733			48

Adjusted EBITDA	$	(6,032	)	$	(13,206	)	$	(14,953	)	$	(13,329	)

EBITDA and Adjusted EBITDA Results. TiVo’s “EBITDA” means income before interest income and expense, provision for income taxes and depreciation and amortization. TiVo’s “Adjusted EBITDA” is EBITDA less expense for stock-based compensation. EBITDA and Adjusted EBITDA are not measures of financial performance under generally accepted accounting principles, which we refer to as GAAP. TiVo’s EBITDA and Adjusted EBITDA results are calculated by adjusting GAAP net income to exclude the effects of items that management believes are not directly related to the underlying performance of TiVo’s core business operations. A table reconciling TiVo’s EBITDA and Adjusted EBITDA to GAAP net income is included with the condensed consolidated financial statements attached to this release. We have presented EBITDA and Adjusted EBITDA solely as supplemental disclosure because we believe they allow for a more complete analysis of our results of operations and we believe that EBITDA and Adjusted EBITDA are useful to investors because EBITDA and Adjusted EBITDA are commonly used to analyze companies on the basis of operating performance, leverage and liquidity. In addition, because of the variety of equity awards used by companies, the varying methodologies for determining stock-based compensation expense, and the subjective assumptions involved in those determinations, we believe excluding stock-based compensation enhances the ability of management and investors to compare our core operating results over multiple periods. We do not use stock-based compensation expense in our internal measures. A limitation associated with these non-GAAP measures is that they do not include any stock-based compensation expense related to hiring, retaining, and incentivizing the Company’s workforce. EBITDA and Adjusted EBITDA are not intended to represent, and should not be considered more meaningful than, or as an alternative to, measures of operating performance as determined in accordance with GAAP.

TIVO INC.

OTHER DATA

Subscriptions


	Three Months Ended October 31,
(Subscriptions in thousands)	2006		2005
TiVo-Owned Subscription Gross Additions	101		92

Subscription Net Additions:
TiVo-Owned	53		55
DIRECTV	(37	)	379

Total Subscription Net Additions	16		434

Cumulative Subscriptions:
TiVo-Owned	1,625		1,308
DIRECTV	2,809		2,700

Total Cumulative Subscriptions	4,434		4,008

% of TiVo-Owned Cumulative Subscriptions paying recurring fees	55	%	51	%

Included in the 4,434,000 subscriptions are approximately 138,000 lifetime subscriptions that have reached the end of the 48-month period TiVo uses to recognize lifetime subscription revenue. These lifetime subscriptions no longer generate subscription revenue.

-11-

TIVO INC.

OTHER DATA - KEY BUSINESS METRICS


	Three Months Ended October 31,
TiVo-Owned Churn Rate	2006		2005
	(In thousands)
Average TiVo-Owned subscriptions (for the quarter)	1,596		1,275

TiVo-Owned subscription cancellations (for the quarter)	(48	)	(37	)

TiVo-Owned Churn Rate per month	-1.0	%	-1.0	%

TiVo-Owned Churn Rate per Month. Management reviews this metric, and believes it may be useful to investors, in order to evaluate our ability to retain existing TiVo-Owned subscriptions (including both monthly and product lifetime subscriptions) by providing services that are competitive in the market. Management believes factors such as service enhancements, service commitments, higher customer satisfaction, and improved customer support may improve this metric. Conversely, management believes factors such as increased competition, lack of competitive service features, and increased price sensitivity may cause our TiVo-Owned Churn Rate per month to increase.

We define the TiVo-Owned Churn Rate per month as the total TiVo-Owned subscription cancellations in the period divided by the Average TiVo-Owned subscriptions for the period (including both monthly and product lifetime subscriptions), which then is divided by the number of months in the period. We calculate Average TiVo-Owned subscriptions for the period by adding the average TiVo-Owned subscriptions for each month and dividing by the number of months in the period. We calculate the average TiVo-Owned subscriptions for each month by adding the beginning and ending subscriptions for the month and dividing by two. We are not aware of any uniform standards for calculating churn and caution that our presentation may not be consistent with that of other companies.


	Three Months Ended October 31,						Twelve Months Ended October 31,
Subscription Acquisition Costs	2006			2005			2006			2005
	(In thousands, except SAC)						(In thousands, except SAC)
				Adjusted						Adjusted
Sales and marketing expenses	$	10,123		$	10,006		$	36,493		$	35,939
Rebates, revenue share, and other payments to channel		14,934			18,234			52,099			53,048
Hardware revenues		(27,978	)		(24,652	)		(85,932	)		(90,279	)
Cost of hardware revenues		31,925			24,667			107,489			100,273

Total Acquisition Costs		29,004			28,255			110,149			98,981

TiVo-Owned Subscription Gross Additions		101			92			487			549

Subscription Acquisition Costs (SAC)	$	287		$	307		$	226		$	180

Subscription Acquisition Cost or SAC. Management reviews this metric, and believes it may be useful to investors, in order to evaluate trends in the efficiency of our marketing programs and subscription acquisition strategies. We define SAC as our total acquisition costs for a given period divided by TiVo-Owned subscription gross additions for the same period. We define total acquisition costs as the sum of sales and marketing expenses, rebates, revenue share, and other payments to channel, minus hardware gross margin (defined as hardware revenues less cost of hardware revenues). We do not include DIRECTV subscription gross additions in our calculation of SAC because we incur limited or no acquisition costs for new DIRECTV subscriptions. We are not aware of any uniform standards for calculating total acquisition costs or SAC and caution that our presentation may not be consistent with that of other companies.

-12-


	Three Months Ended October 31,
TiVo-Owned Average Revenue per Subscription	2006			2005
	(In thousands, except ARPU)
Service and Technology revenues	$	52,616		$	43,197
Less: Technology revenues		(3,616	)		(901	)

Total Service revenues		49,000			42,296
Less: DIRECTV-related service revenues		(7,573	)		(8,637	)

TiVo-Owned-related service revenues		41,427			33,659
Average TiVo-Owned revenues per month		13,809			11,220
Average TiVo-Owned per month subscriptions		1,596			1,275

TiVo-Owned ARPU per month	$	8.65		$	8.80


	Three Months Ended October 31,
DIRECTV Average Revenue per Subscription	2006			2005
	(In thousands, except ARPU)
Service and Technology revenues	$	52,616		$	43,197
Less: Technology revenues		(3,616	)		(901	)

Total Service revenues		49,000			42,296
Less: TiVo-Owned-related service revenues		(41,427	)		(33,659	)

DIRECTV-related service revenues		7,573			8,637
Average DIRECTV revenues per month		2,524			2,879
Average DIRECTV per month subscriptions		2,837			2,505

DIRECTV ARPU per month	$	0.89		$	1.15

Average Revenue Per Subscription or ARPU. Management reviews this metric, and believes it may be useful to investors, in order to evaluate the potential of our subscription base to generate revenues from a variety of sources, including subscription fees, advertising, and audience measurement research. ARPU does not include rebates, revenue share and other payments to channel that reduce our GAAP revenues. Additionally, under the accounting policy for our bundled sales program, revenues associated with these bundled sales transactions, which were previously recognized as hardware revenues, are now being recognized in service revenues, which we believe will over time increase our ARPU as currently presented. As a result, you should not use ARPU as a substitute for measures of financial performance calculated in accordance with GAAP. Management believes it is useful to consider this metric excluding the costs associated with rebates, revenue share and other payments to channel because of the discretionary nature of these expenses and because management believes these expenses are more appropriately monitored as part of SAC. We are not aware of any uniform standards for calculating ARPU and caution that our presentation may not be consistent with that of other companies.

-13-

We calculate ARPU per month for TiVo-Owned subscriptions by subtracting DIRECTV-related service revenues (which includes DIRECTV subscription service revenues and DIRECTV-related advertising revenues) from our total reported service revenues and dividing the result by the number of months in the period. We then divide by Average TiVo-Owned subscriptions for the period, calculated as described above for churn rate. The above table shows this calculation and reconciles ARPU for TiVo-Owned subscriptions to our reported service and technology revenues.

We calculate ARPU per month for DIRECTV subscriptions by first subtracting TiVo-Owned-related service revenues (which includes TiVo-Owned subscription service revenues and TiVo-Owned related advertising revenues) from our total reported service revenues. Then we divide average revenues per month for DIRECTV-related service revenues by average subscriptions for the period. The above table shows this calculation and reconciles ARPU for DIRECTV subscriptions to service and technology revenues.

For fiscal 2007, pursuant to the most recent amendment of our agreement with DIRECTV, TiVo now defers a portion of the DIRECTV subscription fees equal to the fair value of the undelivered development services. Otherwise, the recurring subscriptions fees in this agreement are similar to the fees for the DIRECTV receivers with TiVo service activated since 2002.

-14-

EX-99.2 3 dex992.htm FY07 Q3 KEY FINANCIAL METRIC TREND SHEET OF TIVO INC., DATED NOVEMBER 29, 2006 FY07 Q3 Key Financial Metric Trend Sheet of TiVo Inc., dated November 29, 2006

Exhibit 99.2

Trend Sheet for GAAP Statement of Operations

(in thousands, except per share data)

(unaudited)


	Three Months Ended
	Oct 31, 2006			July 31, 2006			Apr 30, 2006			Jan 31, 2006			Oct 31, 2005			Jul 31 2005			Apr 30, 2005			Jan 31, 2005
Income Statement
Net revenues	$	65,660		$	59,167		$	56,512		$	60,067		$	49,615		$	39,335		$	46,908		$	59,429
Hardware revenues		27,978			16,235			9,453			32,266			24,652			4,649			10,526			50,452
Cost of hardware revenues		31,925			21,607			15,146			38,811			24,667			7,697			15,642			52,267
Rebates, revenue share, and other payments to channel		(14,934	)		(9,948	)		(8,050	)		(19,167	)		(18,234	)		(5,988	)		(3,638	)		(25,188	)

Service and Technology revenues	$	52,616		$	52,880		$	55,109		$	46,968		$	43,197		$	40,674		$	40,020		$	34,165
Service revenues		49,000			49,430			46,951			46,305			42,296			40,249			38,344			32,996
Technology revenues		3,616			3,450			8,158			663			901			425			1,676			1,169

Cost of service & technology revenues	$	13,826		$	12,629		$	17,801		$	10,129		$	8,508		$	7,458		$	8,866		$	10,866
Cost of service revenues		10,820			9,628			10,435			10,250			8,431			6,859			8,639			10,426
Cost of technology revenues		3,006			3,001			7,366			(121	)		77			599			227			440

Gross margin of service & technology revenues	$	38,790		$	40,251		$	37,308		$	36,839		$	34,689		$	33,216		$	31,154		$	23,299

Operating expenses
Research and development	$	12,221		$	12,891		$	12,861		$	10,693		$	9,712		$	9,778		$	10,904		$	11,206
Sales and marketing		10,123			8,344			7,389			10,637			10,006			7,574			6,830			11,529
General and administrative		9,811			11,091			15,059			11,769			11,702			8,409			6,138			4,194

Stock-based compensation	$	4,083		$	3,563		$	3,087		$	338		$	165		$	(59	)	$	(58	)	$	252
Cost of services revenues		129			130			94			—			—			—			—			—
Cost of technology revenues		236			243			203			—			—			—			—			—
Research and development		1,608			1,451			1,118			46			(6	)		39			(164	)		128
Sales and marketing		474			450			340			75			20			(146	)		106			124
General and administrative		1,636			1,289			1,332			217			151			48			—			—

Interest and other income (expense)	$	1,158		$	959		$	1,059		$	899		$	816		$	732		$	623		$	(3,006	)
Provision for income tax		(4	)		(12	)		(19	)		(13	)		—			(43	)		(8	)		(26	)
Net loss		(11,092	)		(6,448	)		(10,704	)		(21,086	)		(14,164	)		(892	)		(857	)		(33,665	)
Net loss per common share	$	(0.12	)	$	(0.07	)	$	(0.13	)	$	(0.25	)	$	(0.17	)	$	(0.01	)	$	(0.01	)	$	(0.42	)
Weighted average common shares outstanding		91,930			85,978			85,134			84,643			84,201			83,506			82,381			80,793

Balance Sheet & Cash Flow
Cash & cash equivalents, and short-term investments	$	106,965		$	75,118		$	92,351		$	104,213		$	90,456		$	103,823		$	105,491		$	106,345
Net cash provided by (used in) operating activities (YTD)		(55,212	)		(32,796	)		(14,150	)		3,425			(12,262	)		(6,577	)		(170	)		(37,214	)

Trend Sheet for Non-GAAP Statement of Operations

(including Non-GAAP Net loss and Non-GAAP Net loss per share) excluding stock based compensation(1)

(unaudited, in thousands, except per share amounts)


	Three Months Ended
	Oct 31, 2006 Non-GAAP			July 31, 2006 Non-GAAP			Apr 30, 2006 Non-GAAP			Jan 31, 2006 Non-GAAP			Oct 31, 2005 Non-GAAP			Jul 31, 2005 Non-GAAP			Apr 30, 2005 Non-GAAP			Jan 31, 2005 Non-GAAP
Income Statement
Net revenues	$	65,660		$	59,167		$	56,512		$	60,067		$	49,615		$	39,335		$	46,908		$	59,429
Hardware revenues		27,978			16,235			9,453			32,266			24,652			4,649			10,526			50,452
Cost of hardware revenues		31,925			21,607			15,146			38,811			24,667			7,697			15,642			52,267
Rebates, revenue share, and other payments to channel		(14,934	)		(9,948	)		(8,050	)		(19,167	)		(18,234	)		(5,988	)		(3,638	)		(25,188	)

Service and Technology revenues	$	52,616		$	52,880		$	55,109		$	46,968		$	43,197		$	40,674		$	40,020		$	34,165
Service revenues		49,000			49,430			46,951			46,305			42,296			40,249			38,344			32,996
Technology revenues		3,616			3,450			8,158			663			901			425			1,676			1,169

Cost of service & technology revenues *	$	13,461		$	12,256		$	17,504		$	10,129		$	8,508		$	7,458		$	8,866		$	10,866
Cost of service revenues *		10,691			9,498			10,341			10,250			8,431			6,859			8,639			10,426
Cost of technology revenues *		2,770			2,758			7,163			(121	)		77			599			227			440

Gross margin of service & technology revenues *	$	39,155		$	40,624		$	37,605		$	36,839		$	34,689		$	33,216		$	31,154		$	23,299

Operating expenses
Research and development *	$	10,613		$	11,440		$	11,743		$	10,647		$	9,718		$	9,739		$	11,068		$	11,078
Sales and marketing *		9,649			7,894			7,049			10,562			9,986			7,720			6,724			11,405
General and administrative *		8,175			9,802			13,727			11,552			11,551			8,361			6,138			4,194

Stock-based compensation	$	4,083		$	3,563		$	3,087		$	338		$	165		$	(59	)	$	(58	)	$	252
Cost of services revenues		129			130			94			—			—			—			—			—
Cost of technology revenues		236			243			203			—			—			—			—			—
Research and development		1,608			1,451			1,118			46			(6	)		39			(164	)		128
Sales and marketing		474			450			340			75			20			(146	)		106			124
General and administrative		1,636			1,289			1,332			217			151			48			—			—

Interest and other income (expense)	$	1,158		$	959		$	1,059		$	899		$	816		$	732		$	623		$	(3,006	)
Provision for income tax		(4	)		(12	)		(19	)		(13	)		—			(43	)		(8	)		(26	)
Net loss		(7,009	)		(2,885	)		(7,617	)		(20,748	)		(13,999	)		(951	)		(915	)		(33,413	)

Net loss per common share	$	(0.08	)	$	(0.03	)	$	(0.09	)	$	(0.25	)	$	(0.17	)	$	(0.01	)	$	(0.01	)	$	(0.41	)
Weighted average common shares outstanding		91,930			85,978			85,134			84,643			84,201			83,506			82,381			80,793

*	Excludes stock-based compensation.

(1)

This presentation is not prepared under a comprehensive set of accounting rules or principles such as GAAP. See attached reconciliation of Non-GAAP Statement of Operations excluding stock based compensation and related note for further explanation of this non-GAAP financial measure presented herein.

TiVo Inc.

Reconciliation of Non-GAAP Statement of Operations (including Non-GAAP Net Loss and Non-GAAP Net Loss Per Share) of TiVo Inc. to GAAP Statement of Operations (including GAAP Net Loss and GAAP Net Loss Per Share) of TiVo Inc.

FY 2007 Q1 through Q3

excluding Stock-based Compensation Expense(1)

(unaudited, in thousands, except per share amounts)


	FY 2007 Reconciliation by Quarter
	Q3’07 GAAP			Non-GAAP Adjustments			Q3’07 Non-GAAP			Q2’07 GAAP			Non-GAAP Adjustments			Q2’07 Non-GAAP			Q1’07 GAAP			Non-GAAP Adjustments			Q1’07 Non-GAAP
	(unaudited, in thousands except per share data)
Revenues
Service revenues	$	49,000		$	—		$	49,000		$	49,430		$	—		$	49,430		$	46,951		$	—		$	46,951
Technology revenues		3,616			—			3,616			3,450			—			3,450			8,158			—			8,158
Hardware revenues		27,978			—			27,978			16,235			—			16,235			9,453			—			9,453
Rebates, revenue share, and other payments to channel		(14,934	)		—			(14,934	)		(9,948	)		—			(9,948	)		(8,050	)		—			(8,050	)

Net revenues		65,660			—			65,660			59,167			—			59,167			56,512			—			56,512
Cost of revenues
Cost of service revenues		10,820			(129	)		10,691			9,628			(130	)		9,498			10,435			(94	)		10,341
Cost of technology revenues		3,006			(236	)		2,770			3,001			(243	)		2,758			7,366			(203	)		7,163
Cost of hardware revenues		31,925			—			31,925			21,607			—			21,607			15,146			—			15,146

Total cost of revenues		45,751			(365	)		45,386			34,236			(373	)		33,863			32,947			(297	)		32,650

Gross margin		19,909			365			20,274			24,931			373			25,304			23,565			297			23,862
Operating Expenses
Research and development		12,221			(1,608	)		10,613			12,891			(1,451	)		11,440			12,861			(1,118	)		11,743
Sales and marketing		10,123			(474	)		9,649			8,344			(450	)		7,894			7,389			(340	)		7,049
General and administrative		9,811			(1,636	)		8,175			11,091			(1,289	)		9,802			15,059			(1,332	)		13,727

Loss from operations		(12,246	)		4,083			(8,163	)		(7,395	)		3,563			(3,832	)		(11,744	)		3,087			(8,657	)

Interest income		1,291			—			1,291			988			—			988			1,062			—			1,062
Interest expense and other		(133	)		—			(133	)		(29	)		—			(29	)		(3	)		—			(3	)

Loss before income taxes		(11,088	)		4,083			(7,005	)		(6,436	)		3,563			(2,873	)		(10,685	)		3,087			(7,598	)
Provision for income taxes		(4	)		—			(4	)		(12	)		—			(12	)		(19	)		—			(19	)

Net Loss	$	(11,092	)	$	4,083		$	(7,009	)	$	(6,448	)	$	3,563		$	(2,885	)	$	(10,704	)	$	3,087		$	(7,617	)

Net Loss per common share basic and diluted	$	(0.12	)	$	—		$	(0.08	)	$	(0.07	)	$	—		$	(0.03	)	$	(0.13	)	$	—		$	(0.09	)

Weighted average common shares used to calculate basic net loss per share		91,930			—			91,930			85,978			—			85,978			85,134			—			85,134

(1)	See related note attached hereto for further information on this Non-GAAP reconciliation.

TiVo Inc.

(unaudited, in thousands, except per share amounts)


	FY 2006 Reconciliation by Quarter
	Q4’06 GAAP			Non-GAAP Adjustments			Q4’06 Non-GAAP			Q3’06 GAAP			Non-GAAP Adjustments			Q3’06 Non-GAAP			Q2’06 GAAP			Non-GAAP Adjustments			Q2’06 Non-GAAP			Q1’06 GAAP			Non-GAAP Adjustments			Q1’06 Non-GAAP
	Adjusted									Adjusted									Adjusted
	(unaudited, in thousands except per share data)
Revenues
Service revenues	$	46,305		$	—		$	46,305		$	42,296		$	—		$	42,296		$	40,249		$	—		$	40,249		$	38,344		$	—		$	38,344
Technology revenues		663			—			663			901			—			901			425			—			425			1,676			—			1,676
Hardware revenues		32,266			—			32,266			24,652			—			24,652			4,649			—			4,649			10,526			—			10,526
Rebates, revenue share, and other payments to channel		(19,167	)		—			(19,167	)		(18,234	)		—			(18,234	)		(5,988	)		—			(5,988	)		(3,638	)		—			(3,638	)

Net revenues		60,067			—			60,067			49,615			—			49,615			39,335			—			39,335			46,908			—			46,908
Cost of revenues
Cost of service revenues		10,250			—			10,250			8,431			—			8,431			6,859			—			6,859			8,639			—			8,639
Cost of technology revenues		(121	)		—			(121	)		77			—			77			599			—			599			227			—			227
Cost of hardware revenues		38,811			—			38,811			24,667			—			24,667			7,697			—			7,697			15,642			—			15,642

Total cost of revenues		48,940						48,940			33,175						33,175			15,155						15,155			24,508						24,508

Gross margin		11,127			—			11,127			16,440			—			16,440			24,180			—			24,180			22,400			—			22,400
Operating Expenses
Research and development		10,693			(46	)		10,647			9,712			6			9,718			9,778			(39	)		9,739			10,904			164			11,068
Sales and marketing		10,637			(75	)		10,562			10,006			(20	)		9,986			7,574			146			7,720			6,830			(106	)		6,724
General and administrative		11,769			(217	)		11,552			11,702			(151	)		11,551			8,409			(48	)		8,361			6,138			—			6,138

Loss from operations		(21,972	)		338			(21,634	)		(14,980	)		165			(14,815	)		(1,581	)		(59	)		(1,640	)		(1,472	)		(58	)		(1,530	)
Interest income		900			—			900			826			—			826			734			—			734			624			—			624
Interest expense and other		(1	)		—			(1	)		(10	)		—			(10	)		(2	)		—			(2	)		(1	)		—			(1	)

Loss before income taxes		(21,073	)		338			(20,735	)		(14,164	)		165			(13,999	)		(849	)		(59	)		(908	)		(849	)		(58	)		(907	)
Provision for income taxes		(13	)		—			(13	)		—			—			—			(43	)		—			(43	)		(8	)		—			(8	)

Net Loss	$	(21,086	)	$	338		$	(20,748	)	$	(14,164	)	$	165		$	(13,999	)	$	(892	)	$	(59	)	$	(951	)	$	(857	)	$	(58	)	$	(915	)

Net Loss per common share basic and diluted	$	(0.25	)	$	—		$	(0.25	)	$	(0.17	)	$	—		$	(0.17	)	$	(0.01	)	$	—		$	(0.01	)	$	(0.01	)	$	—		$	(0.01	)

Weighted average common shares used to calculate basic net loss per share		84,643			—			84,643			84,201			—			84,201			83,506			—			83,506			82,381			—			82,381

(1)	See related note attached hereto for further information on this Non-GAAP reconciliation.

TiVo Inc.

FY 2005 Q4

excluding Stock-based Compensation Expense(1)

(unaudited, in thousands, except per share amounts)


	FY 2005 Reconciliation by Quarter
	Q4’05 GAAP			Non-GAAP Adjustments			Q4’05 Non-GAAP
	(unaudited, in thousands except per share data)
Revenues
Service revenues	$	32,996					$	32,996
Technology revenues		1,169						1,169
Hardware revenues		50,452						50,452

Rebates, revenue share, and other payments to channel		(25,188	)					(25,188	)

Net revenues		59,429			—			59,429
Cost of revenues
Cost of service revenues		10,426						10,426
Cost of technology revenues		440						440
Cost of hardware revenues		52,267						52,267

Total cost of revenues		63,133			—			63,133

Gross margin		(3,704	)		—			(3,704	)
Operating Expenses
Research and development		11,206			(128	)		11,078
Sales and marketing		11,529			(124	)		11,405
General and administrative		4,194						4,194

Loss from operations		(30,633	)		252			(30,381	)

Interest income		458						458
Interest expense and other		(3,464	)					(3,464	)

Loss before income taxes		(33,639	)					(33,387	)
Provision for income taxes		(26	)					(26	)

Net Loss	$	(33,665	)	$	252		$	(33,413	)

Net Loss per common share basic and diluted	$	(0.42	)	$	—		$	(0.41	)

Weighted average common shares used to calculate basic net loss per share		80,793			—			80,793

(1)	See related note attached hereto for further information on this Non-GAAP reconciliation.

Note to Trended Non-GAAP Statement of Operations Excluding Stock-Based Compensation Expense.

These FY07 Q3 Key Financial Metric Trend Sheets include the Non-GAAP Statement of Operations adjusted to exclude stock-based compensation expense from the related GAAP line items, including non-GAAP loss from operations. We use these non-GAAP financial measures for internal managerial purposes and to facilitate period-to-period comparisons. These non-GAAP financial measures are used in addition to and in conjunction with our results presented in accordance with GAAP. These non-GAAP financial measures reflect an additional way of viewing aspects of our operations that, when viewed with our GAAP results and the accompanying reconciliations to the corresponding GAAP financial measures, provide a more complete understanding of factors and trends affecting our business. These non-GAAP measures should be considered as a supplement to, and not as a substitute for, or superior to loss from operations, and net net loss and net loss per share calculated in accordance with generally accepted accounting principles.

In addition, because of the variety of equity awards used by companies, the varying methodologies for determining stock-based compensation expense, and the subjective assumptions involved in those determinations, we believe excluding stock-based compensation enhances the ability of management and investors to compare our core operating results over multiple periods. We do not use stock-based compensation expense in our internal measures. A limitation associated with these non-GAAP measures is that they do not include any stock-based compensation expense related to hiring, retaining, and incentivizing the Company’s workforce.

Trend Sheet for Non-GAAP Key Financial Metrics(1)

(unaudited, in thousands, except per share amounts)


	Three Months Ended
	Oct 31, 2006			July 31, 2006			Apr 30, 2006			Jan 31, 2006			Oct 31, 2005			Jul 31, 2005			Apr 30, 2005			Jan 31, 2005
Reconciliation to EBITDA and Adjusted EBIDTA
Net loss	$	(11,092	)	$	(6,448	)	$	(10,704	)	$	(21,086	)	$	(14,164	)	$	(892	)	$	(857	)	$	(33,665	)
Add back:
Depreciation & amortization		2,219			1,868			1,730			1,756			1,609			1,621			1,425			1,426
Interest income & expense		(1,246	)		(988	)		(1,060	)		(898	)		(816	)		(732	)		(624	)		(435	)
Provision for income tax		4			12			19			13			—			43			8			26
EBITDA	$	(10,115	)	$	(5,556	)	$	(10,015	)	$	(20,215	)	$	(13,371	)	$	40		$	(48	)	$	(32,648	)
Stock-based compensation		4,083			3,563			3,087			338			165			(59	)		(58	)		252
Adjusted EBITDA	$	(6,032	)	$	(1,993	)	$	(6,928	)	$	(19,877	)	$	(13,206	)	$	(19	)	$	(106	)	$	(32,396	)

Subscription Metrics
TiVo-Owned subscription gross additions		101			74			91			221			92			77			104			276
TiVo-Owned subscription cancellations		(48	)		(44	)		(40	)		(38	)		(37	)		(37	)		(32	)		(25	)
TiVo-Owned churn rate per month		-1.0	%		-0.9	%		-0.9	%		-0.9	%		-1.0	%		-1.0	%		-0.9	%		-0.8	%
TiVo-Owned net additions		53			30			51			183			55			40			72			251
TiVo-Owned cumulative subscriptions		1,625			1,572			1,542			1,491			1,308			1,253			1,213			1,141
% of TiVo-Owned cumulative subscriptions paying recurring fees		55	%		53	%		52	%		51	%		51	%		51	%		51	%		50	%
Fully Amortized Active Lifetime Subscriptions		138			129			122			100			89			83			76			65

DIRECTV Net additions		-37			-29			2			173			379			214			247			447

Total subscription net additions		16			1			53			356			434			254			319			698
Total cumulative subscriptions		4,434			4,418			4,417			4,364			4,008			3,574			3,320			3,001

TiVo-Owned ARPU & Subscription Acquisition Costs
TiVo-Owned-related service revenues		41,427			41,229			38,942			36,703			33,659			32,764			31,245			26,234
TiVo-Owned average subscriptions		1,596			1,547			1,520			1,388			1,275			1,233			1,180			995
TiVo-Owned ARPU per month	$	8.65		$	8.88		$	8.54		$	8.82		$	8.80		$	8.86		$	8.83		$	8.79

TiVo-Owned total acquisition costs		29,004			23,664			21,132			36,349			28,255			16,610			15,584			38,532
TiVo-Owned subscription gross additions		101			74			91			221			92			77			104			276
TiVo-Owned subscription acquisition costs	$	287		$	320		$	232		$	164		$	307		$	216		$	150		$	140

DIRECTV ARPU & Subscription Acquisition Costs
DIRECTV-related service revenues		7,573			8,201			8,009			9,602			8,637			7,485			7,099			6,762
DIRECTV average subscriptions		2,837			2,858			2,881			2,818			2,505			2,200			1,994			1,622
DIRECTV ARPU per month	$	0.89		$	0.96		$	0.93		$	1.14		$	1.15		$	1.13		$	1.19		$	1.39

(1)	This presentation is not prepared under a comprehensive set of accounting rules or principles such as GAAP. See attached reconciliation of Non-GAAP Key Financial Metrics and related notes for further explanation of these metrics presented herein.

Reconciliation of Non-GAAP Key Financial Metrics of TiVo Inc. and Related Notes


	Three Months Ended
(Subscriptions in thousands)	Oct 31, 2006		July 31, 2006		April 30, 2006		Jan 31, 2006		Oct 31, 2005		Jul 31, 2005		April 30, 2005		Jan 31, 2005
TiVo-Owned Subscription Gross Additions:	101		74		91		221		92		77		104		276

Subscription Net Additions:
TiVo-Owned	53		30		51		183		55		40		72		251
DIRECTV	-37		-29		2		173		379		214		247		447

Total Subscription Net Additions	16		1		53		356		434		254		319		698

Cumulative Subscriptions:
TiVo-Owned	1,625		1,572		1,542		1,491		1,308		1,253		1,213		1,141
DIRECTV	2,809		2,846		2,875		2,873		2,700		2,321		2,107		1,860

Total Cumulative Subscriptions	4,434		4,418		4,417		4,364		4,008		3,574		3,320		3,001

% of TiVo-Owned Cumulative Subscriptions paying recurring fees	55	%	53	%	52	%	51	%	51	%	51	%	51	%	50	%


	Three Months Ended
(Subscriptions in thousands)	Oct 31, 2006		July 31, 2006		April 30, 2006		Jan 31, 2006		Oct 31, 2005		Jul 31, 2005		April 30, 2005		Jan 31, 2005
Average TiVo-Owned subscriptions	1,596		1,547		1,520		1,388		1,275		1,233		1,180		995
Tivo-Owned subscription cancellations	(48	)	(44	)	(40	)	(38	)	(37	)	(37	)	(32	)	(25	)

Tivo-Owned Churn Rate per month	-1.0	%	-0.9	%	-0.9	%	-0.9	%	-1.0	%	-1.0	%	-0.9	%	-0.8	%


	Three Months Ended
Subscription Acquisition Costs	Oct 31, 2006			Jul 31, 2006			April 30, 2006			Jan 31, 2006			Oct 31, 2005			Jul 31, 2005			April 30, 2005			Jan 31, 2005
										Adjusted			Adjusted			Adjusted
	(In thousands, except SAC)
Sales and marketing expenses	$	10,123		$	8,344		$	7,389		$	10,637		$	10,006		$	7,574		$	6,830		$	11,529
Rebates, revenue share, and other payments to channel		14,934			9,948			8,050			19,167			18,234			5,988			3,638			25,188
Hardware revenues		(27,978	)		(16,235	)		(9,453	)		(32,266	)		(24,652	)		(4,649	)		(10,526	)		(50,452	)
Cost of hardware revenues		31,925			21,607			15,146			38,811			24,667			7,697			15,642			52,267

Total Acquisition Costs		29,004			23,664			21,132			36,349			28,255			16,610			15,584			38,532

TiVo-Owned Subscription Gross Additions		101			74			91			221			92			77			104			276

Subscription Acquisition Costs (SAC)	$	287		$	320		$	232		$	164		$	307		$	216		$	150		$	140

Subscription Acquisition Cost or SAC. Management reviews this metric, and believes it may be useful to investors, in order to evaluate trends in the efficiency of our marketing programs and subscription acquisition strategies. We define SAC as our total acquisition costs for a given period divided by TiVo-Owned subscription gross additions for the same period. We define total acquisition costs as the sum of sales and marketing expenses, rebates, revenue share, and other payments to channel, minus hardware gross margin (defined as hardware revenues less cost of hardware revenues). We do not include DIRECTV subscription gross additions in our calculation of SAC because we incur limited or no acquisition costs for new DIRECTV subscriptions. We are not aware of any uniform standards for calculating total acquisition costs or SAC and caution that our presentation may not be consistent with that of other companies

Reconciliation of Non-GAAP Key Financial Metrics of TiVo Inc. and Related Notes


	Three Months Ended
TiVo-Owned Average Revenue per Subscription	Oct 31, 2006			July 31, 2006			April 30, 2006			Jan 31, 2006			Oct 31, 2005			Jul 31, 2005			April 30, 2005			Jan 31, 2005
	(In thousands, except ARPU)
Service and Technology revenues	$	52,616		$	52,880		$	55,109		$	46,968		$	43,197		$	40,674		$	40,020		$	34,165
Less: Technology revenues		(3,616	)		(3,450	)		(8,158	)		(663	)		(901	)		(425	)		(1,676	)		(1,169	)

Total Service revenues		49,000			49,430			46,951			46,305			42,296			40,249			38,344			32,996
Less: DIRECTV-related service revenues		(7,573	)		(8,201	)		(8,009	)		(9,602	)		(8,637	)		(7,485	)		(7,099	)		(6,762	)

TiVo-Owned-related service revenues		41,427			41,229			38,942			36,703			33,659			32,764			31,245			26,234
Average TiVo-Owned revenues per month		13,809			13,743			12,981			12,234			11,220			10,921			10,415			8,745
Average TiVo-Owned per month subscriptions		1,596			1,547			1,520			1,388			1,275			1,233			1,180			995

TiVo-Owned ARPU per month	$	8.65		$	8.88		$	8.54		$	8.82		$	8.80		$	8.86		$	8.83		$	8.79


	Three Months Ended
DIRECTV Average Revenue per Subscription	Oct 31, 2006			July 31, 2006			April 30, 2006			Jan 31, 2006			Oct 31, 2005			Jul 31, 2005			April 30, 2005			Jan 31, 2005
	(In thousands, except ARPU)
Service and Technology revenues	$	52,616		$	52,880		$	55,109		$	46,968		$	43,197		$	40,674		$	40,020		$	34,165
Less: Technology revenues		(3,616	)		(3,450	)		(8,158	)		(663	)		(901	)		(425	)		(1,676	)		(1,169	)

Total Service revenues		49,000			49,430			46,951			46,305			42,296			40,249			38,344			32,996
Less: TiVo-Owned-related service revenues		(41,427	)		(41,229	)		(38,942	)		(36,703	)		(33,659	)		(32,764	)		(31,245	)		(26,234	)

DIRECTV-related service revenues		7,573			8,201			8,009			9,602			8,637			7,485			7,099			6,762
Average DIRECTV revenues per month		2,524			2,734			2,670			3,201			2,879			2,495			2,366			2,254
Average DIRECTV per month subscriptions		2,837			2,858			2,881			2,818			2,505			2,200			1,994			1,622

DIRECTV ARPU per month	$	0.89		$	0.96		$	0.93		$	1.14		$	1.15		$	1.13		$	1.19		$	1.39

Beginning in the quarter ending April 30, 2006, pursuant to the most recent amendment of our agreement with DIRECTV, TiVo now defers a portion of the DIRECTV subscription fees equal to the fair value of the undelivered development services. Otherwise, the recurring subscriptions fees in this agreement are similar to the fees for the DIRECTV receivers with TiVo service activated since 2002.

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