TiVo Boosts Subscribers and Revenue But Posts Net Loss30 Aug, 2001 By: Joan Villa
TiVo has boosted subscribers and revenue in its second quarter ended July 31, while rolling out a “dual” tuner for its DirecTV subscribers that allows them to watch and record separate programs at the same time.
During the second quarter, TiVo activated 40,000 new subscribers to bring its base to 229,000 viewers — a 21% increase from first-quarter subscriber rates and a 332% boost from the same period last year. Revenues climbed 28% to $4.1 million from the first quarter, representing nearly a four-fold increase from the $869,000 reported in last year’s second quarter. Nonetheless, the company reported a net loss of $33.6 million for the quarter compared to a $38.9 million loss in the year-ago period.
TiVo is still working toward break-even cash flow in fiscal 2003, said president and c.e.o. Mike Ramsay in an earnings call Thursday.
The TiVo “combo” box with the dual recording and viewing feature will be upgraded through software automatically downloaded and installed over the next few weeks, allowing TiVo to more effectively compete with rivals, Ramsay said.
“We are really attacking our competitor’s position with regard to Microsoft’s Ultimate TV,” he explained. “This is a major competitive milestone which in effect neutralizes Microsoft’s advantage in regard to TiVo.”
Further, the company recently completed private financing that provides $51.75 million, including $8.1 million in non-cash promotions and advertising contributed by broadcast partners Discovery and NBC, Ramsay said. TiVo is also looking to expand corporate partnerships that would further boost the service’s visibility, similar to advertising deals entered into in the second quarter with BMW and Coca-Cola, he added.
In earnings estimates for the third quarter, the service expects to boost revenue another 20% to 30% to between $4.9 million and $5.3 million and add 45,000 new subscribers, slightly more than in the second quarter.
“We’re entering the second half of the year with great optimism and excitement about the potential of this category,” Ramsay said. “In upcoming quarters we will focus on extending our lead at retail.”