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TIVO INC (TIVO)
10-K/A
Annual report pursuant to section 13 and 15(d)
Filed on 08/25/2011
Filed Period 01/30/2011

Table of contents

  • Page 1
    TIVO INC (TIVO) 10-K/A Annual report pursuant to section 13 and 15(d) Filed on 08/25/2011 Filed Period 01/30/2011

  • Page 2
    ... of incorporation or organization) 77-0463167 (IRS Employer Identification No.) 2160 Gold Street, PO Box 2160, Alviso, CA (Address of principal executive offices) 95002 (Zip Code) (408) 519-9100 (Registrant's telephone number including area code) Securities registered pursuant to Section 12...

  • Page 3
    ...  Indicate by check mark whether the registrant is a shell company (as defined in Exchange Act Rule 12b-2). The aggregate market value of the registrant's common stock, $0.001 par value per share, held by non-affiliates of the registrant on July 31, 2010, the last business day of the registrant...

  • Page 4
    ... Cash Flows" and on page 74 under the heading entitled "TiVo Inc. Notes to Consolidated Financial Statements" of the Company's Form 10-K in error. This Amendment does not otherwise amend or change any numerical entries or otherwise affect the Company's financial statements in the Form 10-K. No other...

  • Page 5
    ... by reference under Item 6. "Selected Financial Data." Index to Consolidated Financial Statements Reports of Independent Registered Public Accounting Firm 5 Consolidated Balance Sheets 7 Consolidated Statements of Operations 8 Consolidated Statements of Stockholders' Equity and Comprehensive...

  • Page 6
    ... is to express an opinion on these consolidated financial statements based on our audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable...

  • Page 7
    ... is to express an opinion on the Company's internal control over financial reporting based on our audit. We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain...

  • Page 8
    ... 31, 2011 January 31, 2010 ASSETS CURRENT ASSETS Cash and cash equivalents Short-term investments Accounts receivable, net of allowance for doubtful accounts of $275 and $409 Inventories Deferred cost of technology revenues, current Prepaid expenses and other, current Total current assets LONG-TERM...

  • Page 9
    ... 31, 2011 Revenues Service revenues Technology revenues Hardware revenues Net revenues Cost of revenues Cost of service revenues Cost of technology revenues Cost of hardware revenues Total cost of revenues Gross margin Research and development Sales and marketing Sales and marketing, subscription...

  • Page 10
    ... Net income Unrealized loss on marketable securities Comprehensive income BALANCE JANUARY 31, 2009 Issuance of common stock related to exercise of common stock options Issuance of common stock related to employee stock purchase plan Issuance of restricted shares of common stock Retirement due...

  • Page 11
    ... of fixed assets Stock-based compensation expense Amortization of discounts and premiums on investments Inventory write-down Utilization of trade credits Allowance for doubtful accounts Changes in assets and liabilities: Accounts receivable Inventories Deferred cost of technology revenues Prepaid...

  • Page 12
    ..., marketing, and sales support, as well as third-party rollout schedules, software development issues for third-party products which contain its technology; intellectual property claims by and against the Company; access to television programming including digital cable signals in connection with...

  • Page 13
    ...banks for customer credit card, debit card and EBT transactions that take in excess of three days to process are classified as accounts receivable. As of January 31, 2011, the Company had approximately $173,000 of unbilled accounts receivable related to long-term development contracts. Allowance for...

  • Page 14
    ...enable the TiVo service. Service Revenues. Included in service revenues are revenues from recurring and prepaid subscription plans to the TiVo service and fees received from the sale of advertising and audience research measurement services. Monthly and prepaid fixed-length subscription revenues are...

  • Page 15
    ... to cancel their subscription within 30 days of subscription activation for a full refund. TiVo establishes allowances for expected subscription cancellations. Also included in service revenues are fees received from multiple system operators ("MSO"s), such as Comcast, DIRECTV, and Seven/Hybrid TV...

  • Page 16
    ... fee in advance (prepaid program). After the initial committed subscription term, the customers have various pricing options at which they can renew the subscription. The VOE of fair value of the subscription services is established based on standalone sales of the service and varies by pricing plan...

  • Page 17
    ...obtained through credit card sales. The Company sells its TiVo-enabled DVRs to retailers under customary credit terms and generally requires no collateral. No customer generated 10% or more of net revenues for the fiscal years ended January 31, 2011, 2010, and 2009. The Company's accounts receivable...

  • Page 18
    ... 31, 2011 DIRECTV Best Buy Seven/Hybrid TV Comcast RCN Other customers Total accounts receivable 15% -% -% 17% 10% 58% 100% 2010 12% 17% 22% 27% -% 22% 100% 2009 18% 19% 7% 25% -% 31% 100% The Company does not have a long-term written supply agreement with Broadcom, the sole supplier of the system...

  • Page 19
    ...111 2010 (in thousands) (1) Auction rate securities and other investment securities are included in "Long-term investments" on the Company's consolidated balance sheets. Marketable Securities The Company's investment securities portfolio consists of various debt instruments, including corporate and...

  • Page 20
    ... in marketable securities designated as available-forsale: As of January 31, 2011 Adjusted Cost Gross Unrealized Gains (in thousands) Certificate of deposit Commercial paper Corporate debt securities US agency securities US Treasury securities Foreign government securities Variable-rate demand...

  • Page 21
    ... believes that these changes in the estimated fair values of these marketable investments securities are related to temporary market fluctuations. As of January 31, 2011 , the estimated fair value of the Company's ARS was $510,000 lower than their cost, and we have recorded this unrealized loss...

  • Page 22
    ... rate securities and asset-backed securities. This is because the Company values its cash equivalents and marketable securities using quoted market prices in active markets for identical assets (Level 1 inputs) or alternative pricing sources and models utilizing market observable inputs (Level...

  • Page 23
    ... January 31, 2011 Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (in thousands) Assets: Cash equivalents: Commercial paper Money market funds Short-term investments: Certificate of deposit...

  • Page 24
    ... reconciliations of financial assets measured at fair value using significant unobservable inputs (Level 3) during the twelve months ended January 31, 2011 and January 31, 2010 (in thousands): Auction Rate Securities Balance, January 31, 2010 Transfer into Level 3 Purchases Sales Total unrealized...

  • Page 25
    ... year 2008, the Company entered into a barter transaction, exchanging TiVo Series2â„¢ standard definition DVR inventory with a net book value of $2,774,000 for barter credits that are redeemable for a percentage of future purchases of advertising media and other services from certain vendors. The...

  • Page 26
    ... 305 84 $ 6,956 2012 2013 2014 2015 2016 Thereafter Total 8. ACCRUED LIABILITIES Accrued liabilities consist of the following: As of January 31, 2011 (In thousands) Compensation and vacation Marketing and promotions Legal services Redeemable gift certificates for subscriptions Other Total accrued...

  • Page 27
    25

  • Page 28
    ... TiVo filed a complaint against EchoStar Communications Corporation and EchoStar DBS Corporation in the U.S. District Court for the Eastern District of Texas alleging willful and deliberate infringement of U.S. Patent No. 6,233,389, entitled "Multimedia Time Warping System." The Company subsequently...

  • Page 29
    ... for the Federal Circuit stayed the district court's ruling pending EchoStar's appeal of the district court's decision finding EchoStar in contempt of the permanent injunction. On September 4, 2009, the United States District Court for the Eastern District of Texas awarded TiVo contempt damages in...

  • Page 30
    ...that Dish's unspecified DVRs do not infringe TiVo's 389 patent. On March 31, 2009, the court denied TiVo's motion to dismiss. On May 28, 2009, the court ordered the action transferred to the Eastern District of Texas which stayed the action on June 19, 2009. The Company intends to defend this action...

  • Page 31
    ... Parameter for Displaying or Recording"), 6,028,604 ("User Friendly Remote System Interface Providing Previews of Applications"), and 5,758,258 ("Selective Delivery of Programming for Interactive Televideo System"). The Complaint named TiVo as Respondent. On February 24, 2011, the ITC voted to...

  • Page 32
    ... Corporation, Adobe Systems Incorporated, and others in the United States District Court for the Eastern District of Texas for infringement of the following four patents: U.S. Patent Nos. 7,136,913 ("Object oriented communication among platform independent systems across a firewall over the internet...

  • Page 33
    ... of Video"). On March 2, 2011, TiVo entered into a patent license agreement with MPT settling the pending litigation. Securities Litigation.The Company and certain of its officers and directors ("TiVo defendants") were originally named as defendants in a consolidated securities class action lawsuit...

  • Page 34
    ... Circuit Court of Appeals for rehearing en banc of the Court's December 2, 2010 ruling, and the underwriter defendants filed a petition for panel rehearing or rehearing en banc. On January 18, 2011, the Ninth Circuit Court of Appeals issued an Order and Amended Opinion, in which the Court denied...

  • Page 35
    ... feet of office space. The corporate headquarters houses our administrative, sales and marketing, customer service, and product development activities, under a lease that expires on January 31, 2017. The Company also has operating leases for sales and administrative office space in New York City...

  • Page 36
    ...days from the date the director's service terminated. The number of shares authorized for option grants under the Directors' Plan is 1,400,000, subject to an annual increase of 100,000 shares. As of January 31, 2011 all unissued shares under 1999 Non-Employee Directors' Stock Plan have expired. 1999...

  • Page 37
    ...activity and related information for the twelve months ended January 31, 2011, 2010, and 2009 is as follows: Shares WeightedAverage Exercise Price $ 6.91 8.65 5.21 7.17 $ 7.22 9.71 6.13 8.50 $ 7.71 8.23 7.05 18.06 $ 7.19 WeightedAverage Remaining Contractual Term 6.76 $ Aggregate Intrinsic Value...

  • Page 38
    ...on the Company's closing stock price on January 31, 2011. The total fair value of RSAs and RSUs vested was $8.2 million, $6.5 million, and $2.4 million for the twelve months ended January 31, 2011, 2010, and 2009, respectively. The following table summarizes the activities for the Company's unvested...

  • Page 39
    ..., TiVo amended the Rights Plan a fifth time to extend the expiration date of the Rights Plan from January 9, 2011 to the close of business on the date that is six months after the date that a final, non-appealable order or judgment is entered in connection with the Company's litigation with EchoStar...

  • Page 40
    ...compensation for the twelve months ended January 31, 2011, 2010, and 2009, respectively is as follows: Fiscal Year Ended January 31, 2011 Cost of service revenues Cost of technology revenues Research and development Sales and marketing General and administrative Deferred cost of technology revenues...

  • Page 41
    ...withholding taxes in foreign jurisdictions. The income tax benefit in fiscal year 2010 is due to a refund of previously paid Alternative Minimum Tax ("AMT") and refundable research credits. The income tax expense in fiscal year 2009 relates to federal AMT, state income taxes, and foreign withholding...

  • Page 42
    ...research credit had expired for amounts paid or incurred after December 31, 2009. The Company has generated federal research credits of approximately $5.0 million for fiscal year ended January 31, 2011. On November 6, 2009, President Obama signed into legislation, the Worker, Business assistance Act...

  • Page 43
    ... in income tax expense, if applicable. The Company accrued approximately $13,000 of interest or penalties related to unrecognized tax benefits recorded through January 31, 2011. The Company or one of its subsidiaries files income tax returns in the U.S. federal jurisdiction, and various state and...

  • Page 44
    .... Acceptance of the delivery of the TiVo service software solution by Comcast occurred on June 27, 2007 and the TiVo service has launched in its initial market. Comcast accepted the TiVo advertising management system on March 31, 2008. Our statements of work with Comcast provided for continued...

  • Page 45
    ... promote the new HD DIRECTV DVR featuring the TiVo Service once it has launched. DIRECTV, upon the deployment of high definition DIRECTV DVRs with TiVo service, is entitled to recoup, over time, a portion of certain development fees through a reduction in certain subscription fees. The new agreement...

  • Page 46
    ... Registered Public Accounting Firm (incorporated by reference to Exhibit 23.1 of the registrant's current report on Form 10-K filed on March 14, 2011). Certification of Thomas S. Rogers, Chief Executive Officer of TiVo Inc. dated August 25, 2011 pursuant to Securities Exchange Act Rules 13a...

  • Page 47
    ... the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, there unto duly authorized. TIVO INC. Date: August 25, 2011 /S/ THOMAS S. ROGERS Thomas S. Rogers Chief Executive Officer 45

  • Page 48
    ....1 Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 I, Thomas S. Rogers, certify that: 1) I have reviewed this Amendment No. 1 to the annual report on Form 10-K of TiVo Inc.; 2) Based on my knowledge, this report does not contain any untrue statement...

  • Page 49
    ....2 Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 I, Anna Brunelle, certify that: 1) I have reviewed this Amendment No. 1 to the annual report on Form 10-K of TiVo Inc.; 2) Based on my knowledge, this report does not contain any untrue statement of...

  • Page 50
    ... of 2002 In connection with the TiVo Inc. (the "Company") Amendment No. 1 to the Annual Report on Form 10-K for the year ended January 31, 2011 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Thomas S. Rogers, Chief Executive Officer of the Company, certify...

  • Page 51
    ... In connection with the TiVo Inc. (the "Company") Amendment No. 1 to the Annual Report on Form 10-K for the year ended January 31, 2011 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Anna Brunelle, Chief Financial Officer of the Company, certify pursuant...