Rovi Posts Q3 Loss of $13.3 Million1 Nov, 2012 By: Erik Gruenwedel
Rovi Corp. Nov. 1 reported a third-quarter (ended Sept. 30) loss of $13.3 million compared with net income of $1.8 million during the previous-year period.
Santa Clara, Calif.-based Rovi attributed the loss in part to a $15.1 million decline to $72.5 million in revenue from consumer electronics manufacturers, compared with revenue of $87.6 million during the previous-year period.
Rovi said delays in adding new patent licensees and renewals among several key CE manufacturers and TV Everywhere platforms in the U.S. and in Europe, among other issues, contributed to the decline. Indeed, Rovi currently is involved in litigation with several CE companies and separate over-the-top video platforms regarding the licenses.
The aforementioned litigation also impacts further rollout of the Rovi Entertainment Store, new DivX content creation software, DivX Plus Streaming and DTA guides.
Rovi Entertainment Store, which offers backend transactional video-on-demand and cloud-based storage platforms for retail and ecommerce clients, now claims 1.1 million virtual storefronts — up 18% from the second quarter.
As previously announced, Rovi has signed digital video service deals with Sainsbury's in the United Kigndom, Toys ‘R’ Us Movies Web store in the United States; and launched Best Buy’s CinemaNow on Android tablets and smartphones in the U.S. and Canada, PlayStation 3 in Canada, in addition to iOS playback for iPad, iPhone and iPod Touch.
Rovi Entertainment Store also signed Dixon’s KnowHow Movies platform in the U.K. for connected LG televisions and Samsung Blu-ray Disc players.
“The business has some challenges … with unclear outcomes for investors beyond management feeling secure in its IP position,” Ralph Schackart, analyst with William Blair & Co. in Chicago, wrote in a Nov. 1 note. “We expect Rovi shares to remain relatively volatile in the near term.”
The company reported quarterly revenue of $169.6 million, compared with revenue of $181.9 million last year.