Record service and technology revenues plus the strongest quarter of cable subscription additions to date have led to TiVo exhibiting its largest quarterly growth in several years.
For the third quarter ended 31 October 2013, the DVR pioneer posted service and technology revenues of $81.7 million, an increase of 34% year-over-year, meeting the high end of its guidance which was exceeded by both adjusted EBITDA of $23.8 million and net Income of $12.5 million.
Driving the strong quarterly numbers was a 32% year-over-year growth in TiVo subscriptions which now stand at approximately 3.9 million. During the quarter TiVo posted MSO gross subscription additions of close to 300,000, its strongest quarter of cable subscription additions to date, making it the largest quarterly growth in several years.
In terms of performance for specific customers, TiVo is now covering nearly half of the subscribers at flagship UK cable incumbent and Liberty Global subsidiary Virgin Media and a third at Spanish cableco ONO. Other key highlights were found at Com Hem, Sweden's largest cable operator which rolled out TiVo's IPTV service, and Blue Ridge Communications, a top 20 cable service provider, which selected TiVo to deliver its advanced multiscreen television solution and user experience and Atlantic Broadband which recently launched its TiVo solution.
The company also attributed growth to its Roamio solution supporting an out-of-home DVR service and TiVo Stream device, which allows users to stream and download live TV and recorded content to smartphones and tablets.
"This was another solid quarter for TiVo, our strongest cable distribution results to date as well as best subscription growth in several years," said president and CEO Tom Rogers, commenting on the results.
"In fact the best quarter for TiVo subscription growth since TiVo began mass distribution of its technology and services in the cable DVR market. This growth is in stark contrast to the loss of video subs throughout the cable industry."
For the fourth quarter of Fiscal Year 2014, TiVo anticipates service and technology revenues in the range of $83 million to $85 million, the midpoint of which is a close to a 30% increase from the $65.7 million reported in last year's fourth quarter. Benefiting Q4 will likely be an expected increase in MSO revenue growth, driven by a partial quarter of Virgin revenue recognition in service revenue.