TiVo Inc. said Tuesday that its third-quarter loss widened as expenses outstripped increased demand for its TV-recording technology.
The company's results were better than what analysts were expecting, and TiVo's shares rose 5 percent in extended trading.
For the quarter that ended Oct. 31, TiVo reported a loss of $24.5 million, or 21 cents per share. This compares to a net loss of $20.6 million, or 18 cents per share, in the year-ago quarter.
Analysts surveyed by FactSet expected a loss of 23 cents per share.
Alviso, Calif.-based TiVo sells set-top boxes that record, pause, rewind and fast-forward live TV and licenses its technology to cable companies for their own set-top boxes.
The company's revenue rose 27 percent to $64.8 million from $50.9 million a year earlier, beating analyst expectations for $60.1 million in revenue.
TiVo's service and technology revenue rose 25 percent to $51.8 million, while hardware revenue rose 36 percent to $13 million.
TiVo's legacy business of selling set-top boxes has been declining, and the company is focusing more on licensing its software to cable companies.
Expenses rose 23 percent to $54.5 million, due mainly to higher research and development expenses.
The company added a net 117,000 subscribers during the quarter, ending October with 2.0 million subscribers to both its own service and ones using TiVo technology licensed by cable companies. This compares with 2.3 million overall subscribers a year earlier.
The number of people who directly subscribe to TiVo fell to 1.1 million from 1.3 million a year earlier, while the number of customers using cable company products licensed from TiVo declined to 910,000 from 951,000.
Looking at the current quarter, TiVo expects increased litigation costs from ongoing patent suits with AT&T Inc. and Microsoft Corp., as well as higher costs for its hard drives since the recent flooding in Thailand has hampered technology manufacturing in that country. The company predicted a net loss of $31 million to $33 million and service and technology revenues of $48 million to $50 million.
TiVo shares jumped 56 cents, or 6 percent, to $10.13 in after-hours trading. The stock finished regular trading down a penny at $9.57.