TiVo 2014 Annual Report Download

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For the fiscal year ended January 31, 2015
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FOR THE TRANSITION PERIOD FROM TO
Commission file number 000-27141
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Securities registered pursuant to Section 12(b) of the Act:
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Securities registered pursuant to Section 12(g) of the Act:
None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes x No o
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No x
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past
90 days. Yes x No o
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post
such files). Yes x No o

Table of contents

  • Page 1
    ... 1934 For the fiscal year ended January 31, 2015 o TRTNSITION REPORT PURSUTNT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHTNGE TCT OF 1934 FOR THE TRANSITION PERIOD FROM Commission file number 000-27141 TO TIVO INC. (Exact name of registrant as specified in its charter) Delaware (State or other...

  • Page 2
    ... to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. Yes o No x

  • Page 3
    ... accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of "accelerated filer", "large accelerated filer", and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer x Accelerated filer o Non...

  • Page 4
    ... quarter, was approximately $1.5 billion (based on the closing sales price of the registrant's common stock on that date as reported in the Nasdaq Global Market). Shares of the registrant's common stock held by each officer and director and each person that controls, is controlled by or is under...

  • Page 5
    TIVO INC. FORM 10-K For the Fiscal Year Ended January 31, 2015 TTBLE OF CONTENTS PTRT I. Item 1. Item 1T. Item 1B. Item 2. Item 3. Item 4. PTRT II. Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchased of Equity Securities Selected Financial Data Management...

  • Page 6
    ... demand to an MSO customers' set-top box (VOD), and network DVRs; • our expectations regarding continued regulatory required access to and installation and operational issues surrounding cable-operator provided CableCARDs™ and switched digital devices essential for TiVo consumer devices in cable...

  • Page 7
    ...TiVo service and technology revenue outside the United States; our expectations regarding a future decrease in the amount of our research and development spending and our associated ability to remain a competitive technology innovator and invest significant resources in advanced television solutions...

  • Page 8
    ... TiVo brand and particular software on the set-top box or mobile device. As of January 31, 2015, there were over 5.5 million total subscriptions to the TiVo service through our consumer and television service provider businesses. We generate revenues primarily from four sources: • Consumer Service...

  • Page 9
    ... providers, and the advertising community. Our goal is to change the way consumers access and watch linear television, on-demand television, and broadband video by offering a best in class user experience and search and discovery services to generate revenue through the licensing of both our TiVo...

  • Page 10
    ... TiVo products and apps for Android-enabled smart phones and tablets and iOS-enabled smartphones and tablets that allow viewers to control their set-top boxes as well as, to consume video both inside and outside the home. We continue to update the TiVo service with new audio and video applications...

  • Page 11
    ... on set-top boxes, and as an app on tablets, and mobile devices which run the TiVo software. We have enhanced the client software to support multiple services and applications, such as receipt of broadband video content, digital music, and photos. The TiVo client software manages interaction with...

  • Page 12
    ... these service providers. Individual customers have access to an Internet-based repository for technical information and troubleshooting techniques. They also can obtain support through other means such as the TiVo website, web forums, email, and telephone support. We offer a manufacturer's warranty...

  • Page 13
    ... DVR functionality and TV Everywhere (TVE) access for mobile devices; most of these DVRs include multiple tuners, high definition recording, and in most cases multi-room viewing capability. TVE access often includes some or all of the linear channel line-up and VOD offering. Some of these solutions...

  • Page 14
    ... created competing products that provide user interface software for use on television set-top boxes and consumer electronic and mobile devices. Such companies may offer more economically attractive agreements to service providers and consumer electronics manufacturers by bundling multiple products...

  • Page 15
    ...and General Manager, Service Provider and Advertising Products Division from April 2005 to November 2009. Prior to joining TiVo, Mr. Klugman was CEO of PointsBeyond.com, an Internet-portal focused on outdoor activities and adventures. In 1999, Mr. Klugman was Vice President of Marketing and Business...

  • Page 16
    ... 14, 2014, we acquired Digitalsmiths Corporation, a privately-held cloud based video search and recommendation service for the Pay TV industry, based in Raleigh, North Carolina. We maintain an Internet website at the following address: www.tivo.com. Financial news and reports and related information...

  • Page 17
    ... of TiVo subscriptions, the prices at which we sell TiVo set-top boxes, the amount of research and development expenses we incur to fund new product development and expand our engineering services capacity, and the amount and timing of settlement payments. In fiscal year 2012, we entered into patent...

  • Page 18
    ... and platform neutral software based downloadable security system designed to allow retail devices to access multichannel video programming. The working group is directed to file a report with the FCC no later than 9 months after the date of the enactment of STELAR. If cable operators were to...

  • Page 19
    ... us to change our business. The delivery of television programming, access to television signals by consumer electronics devices, and the collection of viewing information from subscriptions via the TiVo service and a DVR represent a relatively new category in the television and home entertainment...

  • Page 20
    ... in managing our television service provider customer relationships while offering and marketing a competing retail DVR service. For example, we rely on access to and receipt of certain technologies from third-parties to enable Video on Demand and other content and search features on our products...

  • Page 21
    ... a case our business would be harmed. Many of our current deployment arrangements with television service providers require us to incur significant upfront development, set-up and integration engineering expenses for which we are in total or in part compensated through future service fees received...

  • Page 22
    ...by telecommunications, cable and satellite operators and DVRs and other advanced television solutions (e.g. VOD based services on set-top boxes or other consumer electronic devices (TV, BluRay player, etc.) which stream content remotely) offered by consumer electronics and software companies. To the...

  • Page 23
    ... as cable and satellite television, movie rentals, pay-per-view, Video on Demand, and mail-order DVD services. Such competition could harm our business, financial condition, and results of operations. Many of these products or services have established markets, broad user bases, and proven consumer...

  • Page 24
    ... TV or to mobile devices. We have previously launched access to the entertainment offerings of Amazon Video on Demand service, Netflix, Hulu Plus, VUDU, Pandora, and others for the distribution of digital content directly to broadband-connected TiVo devices. Our offerings with Amazon Video On Demand...

  • Page 25
    ... with Amazon Instant Video, Netflix, Hulu Plus, Pandora, and our other partners, on our own, or an equivalent offering with other third-parties, the attractiveness of the TiVo service to new subscribers would be harmed as consumers increasingly look for new ways to receive and view digital content...

  • Page 26
    ... source of guide data, we may be subject to a period of time in which we are unable to provide the TiVo service to our customers and distribution partners. In such an event, our business would be harmed. If our arrangements with Broadcom or Tribune or with our third-party contract manufacturer...

  • Page 27
    ...make forecasts of demand and commit significant resources towards manufacturing of our DVR units well in advance of our peak selling periods. We also have risks with respect to changing hardware forecasts with our television service provider customers who may revise their purchase forecasts lower or...

  • Page 28
    ...-time outsourced engineering work related to the design, development, and manufacturing of our products, typically to save money and gain access to additional engineering resources. We have worked, and expect to in the future work, with companies located in jurisdictions outside of the United States...

  • Page 29
    ... revenues from these activities, we will need to attract and retain a large and growing base of subscriptions to the TiVo service. We also will need to work closely with television advertisers, cable, satellite, and telecommunications network operators, electronic commerce companies, and consumer...

  • Page 30
    ... sales channel development, and management of existing product inventories to reduce the cost associated with returns and slow moving inventory. As new products are introduced, we intend to monitor closely the inventory of products to be replaced, and to phase out their manufacture in a controlled...

  • Page 31
    ... on such parties to timely service new subscribers to enable their receipt of digital and premium cable content. Our failure to provide adequate customer support for the TiVo service, DVRs, and a CableCARDTM will damage our reputation in the DVR and consumer electronics marketplace and strain our...

  • Page 32
    ... ordered to remove features from our DVRs, we may experience increased difficulty in marketing the TiVo service and related TiVo-enabled DVRs and may suffer reduced revenues as a result. Entertainment companies, networks, or video distributors may claim that our advertising products or features may...

  • Page 33
    ... introduce new services, delay widespread consumer acceptance of our products and services, restrict our use of some television content, increase our costs, and adversely affect our business. We have acquired and may acquire other companies and businesses and may not realize the expected benefits of...

  • Page 34
    ... network of state and federal laws is increasingly regulating these promotional activities. Additionally, we enter into subscription service contracts directly with consumers which govern both our provision of and the consumers' payment for the TiVo service. For example, consumers who activate new...

  • Page 35
    ... that future proposed environmental regulations on consumer electronic devices, such as DVRs and set-top boxes, may regulate and increase the production, manufacture, use, and disposal costs incurred by us and our customers. For example, the Energy Independence and Security Act of 2007 directs the...

  • Page 36
    ... sales of DVRs and new subscriptions to the TiVo service have been higher during the holiday shopping season when compared to other times of the year. If we are unable to accurately forecast and respond to consumer demand for our products, our reputation and brand will suffer and the market price...

  • Page 37
    ... sale of equity securities. Increased leverage as a result of our recent convertible senior notes offering may harm our financial condition and results of operations. As previously reported on Current Report on Form 8-K filed on September 23, 2014 and Form 10-Q filed on December 3, 2014, we issued...

  • Page 38
    ... houses our administrative, sales and marketing, customer service and product development activities, is located in San Jose, California, under a lease that expires on January 31, 2017. Our corporate headquarters includes two buildings totaling 127,124 square feet of office space and an additional...

  • Page 39
    ..., we had 1,001 stockholders of record. The closing price of our common stock on March 13, 2015 was $10.64 per share. Dividend Policy We paid no cash dividends during the fiscal year ended January 31, 2015 and we have no current plans to pay a cash dividend in the future although we will continue to...

  • Page 40
    ...31, 2015 (a) Total Number of Shares Purchased - 6,202 9,825 (b) Tverage Price Paid per share (1) $ (2) $ (3) $ - 11.85 11.00 (c) Total Number of Share Purchased as Part of Publicly Tnnounced Plans or Programs 2,886,506 $ 4,641,587 $ 2,211,016 $ (1) During the month of November 2014 TiVo acquired...

  • Page 41
    ... The following table and graph compares the cumulative total stockholder returns for our common stock, the NASDAQ Composite index and the Research Data Group ("RDG") Technology Composite index over the last five fiscal years. The graph and table assume an investment of $100 in TiVo and in each index...

  • Page 42
    ... Statements of Operations Data: Revenues Service revenues Technology revenues Hardware revenues Net revenues Cost and Expenses Cost of service revenues Cost of technology revenues Cost of hardware revenues Research and development Sales and marketing Sales and marketing, subscription acquisition...

  • Page 43
    ... of consumer electronic applications and devices, such as television set-top boxes with and without DVR functionality, smartphones, and tablets. We offer a full whole-home solution that includes 4Tuner and 6-Tuner DVRs/gateways, non-DVR IP set-top boxes (STBs), and software to enable streaming to...

  • Page 44
    ... be willing to sell the TiVo service. • We expect to see revenue growth from our acquisition of Digitalsmiths. Digitalsmiths currently has business relationships with seven of the top ten U.S. Pay TV operators as well as various consumer electronics manufacturers and content providers. Most of...

  • Page 45
    ...Owned Subscriptions currently pay for the TiVo service on a recurring payment plan (such as a monthly or annual payment plan) or on a one-time basis for the life of TiVo-enabled device (product lifetime subscriptions). Beginning in October 2014, each TiVo Mini device sale includes a product lifetime...

  • Page 46
    ...cable and satellite companies and the increased number of devices that deliver streaming video over the internet to consumers as we continued to have fewer TiVo-Owned Subscription gross additions than TiVo-Owned Subscription cancellations. For the fiscal year ended January 31, 2015 our MSO installed...

  • Page 47
    ... of Contents competition, lack of competitive service features such as high definition television recording capabilities in our older model DVRs or access to certain digital television channels or MSO Video On Demand services, as well as increased price sensitivity, CableCARDTM installation issues...

  • Page 48
    ..., we have historically experienced increased TiVo-Owned subscription gross additions during the fourth quarter; however, sales and marketing, subscription acquisition activities occur throughout the year. During the twelve months ended January 31, 2015, our total acquisition costs were $22.7 million...

  • Page 49
    ...the extent the number of TiVo-Owned subscriptions that are from non-DVR devices, such as TiVo Mini which have lower product lifetime service fees than for DVRs, remains at current levels or increases. Critical Accounting Estimates In preparing our condensed consolidated financial statements, we make...

  • Page 50
    ...delivery of software customization and set up services, training, post contract support (PCS), TiVo-enabled DVRs and non-DVR STBs and TiVo service; and bundled sales of advertising and audience research measurement services. We allocate revenue to each element in a multiple-element arrangement based...

  • Page 51
    ...the longer of the contractual or customer relationship period. We have established VSOE of selling prices for training, DVRs, non-DVR STBs, and maintenance and support, based on the price charged in standalone sales of the element or stated renewal rates in the agreement. The BESP of TiVo service is...

  • Page 52
    ... MSOs, which typically include software customization and set up services, limited training, PCS, TiVo-enabled DVRs, non-DVR STBs, and TiVo service. We usually incur development cost for which we are in total or in part compensated through service fees received after a solution launch. When we are...

  • Page 53
    ...on hand at lower of cost or market and to reserve for products or materials which are not forecasted to be used. We also record accruals for charges that represent management's estimate of our exposure to the contract manufacturer for excess noncancelable purchase commitments. Although we make every...

  • Page 54
    ...TiVo Research for purposes of determining long-lived asset recoverability, management makes assumptions, incorporating market conditions, sales growth rates, gross profit, and operating expenses. Deferred Tax Tssets. We make certain estimates in determining income tax expense for financial statement...

  • Page 55
    ...our MSO service revenues and audience measurement revenues associated with our acquisition of TiVo Research. Technology Revenues. Technology revenues for the fiscal years ended January 31, 2015, and 2014 increased as compared to the same prior year periods primarily due to the settlement and license...

  • Page 56
    ...returns and net of revenue share and marketing development fund payments for the fiscal year ended January 31, 2015 decreased by $2.7 million as compared to the same prior year period. The decrease in net hardware revenues is largely related to changes in sales mix. While we sold an increased number...

  • Page 57
    ... hardware sales that are linked with the sale of TiVoOwned service is not the primary goal of the consumer business. Our cost of hardware revenues for the fiscal year ended January 31, 2015 decreased as compared to the same prior year period. The decrease is largely related to changes in sales 56

  • Page 58
    ... to more DVR units sold to our MSO customers during the fiscal year at a higher average selling price per unit and which had a lower or no hardware subsidy (as historically we have at times sold our hardware at a loss in our TiVo-Owned business as a means to acquire new subscriptions) as compared to...

  • Page 59
    ... acquisition costs include advertising expenses and promotional expenses directly related to our efforts to acquire new TiVo-Owned subscriptions to the TiVo service. Sales and marketing, subscription acquisition expenses for the year ended January 31, 2015 decreased by $3.6 million as compared...

  • Page 60
    ... increases in headcount and headcount related costs of $5.0 million. Litigation proceeds. During the fiscal year ended January 31, 2015, 2014 and 2013 we recorded litigation proceeds of $0.0 million, $108.1 million, and $78.4 million, respectively from our patent infringement settlements. Litigation...

  • Page 61
    ....1 million compared to $296.6 million cash used for the same prior year period. The net cash provided by investing activities for the year ended January 31, 2015 was largely related to TiVo's cash management process, and the purchase and sales of short-term investments resulting in a net increase in...

  • Page 62
    ...options which generated $5.9 million, excess tax benefits from employee stock-based compensation of $13.7 million, and proceeds from the issuance of common stock pursuant to the employee stock purchase plan of $6.0 million. Additionally, in September 2014, the Company issued convertible senior notes...

  • Page 63
    ... are unexpected changes to anticipated demand for our products or in the sales mix of our products, some of the firm, non-cancelable, and unconditional purchase commitments may result in our being committed to purchase excess inventory. As of January 31, 2015, gross unrecognized tax benefits, which...

  • Page 64
    Table of Contents ITEM 8. FINTNCITL STTTEMENTS TND SUPPLEMENTTRY DTTT Index to Consolidated Financial Statements Report of Independent Registered Public Accounting Firm Consolidated Balance Sheets Consolidated Statements of Operations Consolidated Statements of Comprehensive Income (Loss) 64 65 ...

  • Page 65
    ... these consolidated financial statements and an opinion on the Company's internal control over financial reporting 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...

  • Page 66
    Table of Contents TIVO INC. CONSOLIDTTED BTLTNCE SHEETS (In thousands, except per share and share amounts) 65

  • Page 67
    ... Accounts payable Accrued liabilities Deferred revenue, current Total current liabilities LONG-TERM LIABILITIES Deferred revenue, long-term Convertible senior notes Deferred rent and other long-term liabilities Total long-term liabilities Total liabilities COMMITMENTS AND CONTINGENCIES (see...

  • Page 68
    ... 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 acquisition costs General and administrative Litigation...

  • Page 69
    ...31, 2015 Net income (loss) Other comprehensive income: Available-for-sale securities: Unrealized gain (loss) on marketable securities, net of tax Total comprehensive income (loss), net of tax $ $ 30,832 $ 2014 271,816 $ 2013 (5,264) (591) 30,241 $ 355 272,171 $ 162 (5,102) The accompanying notes...

  • Page 70
    ... income BTLTNCE JTNUTRY 31, 2014 Issuance of common stock related to exercise of common stock options Excess tax benefit from employee stock-based compensation plans Issuance of common stock related to employee stock purchase plan Issuance of restricted shares of common stock Forfeiture of...

  • Page 71
    Table of Contents The accompanying notes are an integral part of these consolidated financial statements. 70

  • Page 72
    Table of Contents TIVO INC. CONSOLIDTTED STTTEMENTS OF CTSH FLOWS (In thousands) 71

  • Page 73
    ... plan Excess tax benefits from employee stock-based compensation Proceeds from issuance of convertible senior notes, net of issuance costs Proceeds from issuance of common stock warrants Purchase of convertible note hedges Treasury stock - repurchase of stock Net cash used in financing activities...

  • Page 74
    ...including digital cable signals in connection with CableCARD and switched digital Internet Protocol, downloadable conditional access, and other new signal delivery and encryption technologies; dependence on its relationships with third-party service providers for subscription growth; and the Company...

  • Page 75
    ... consist primarily of receivables from retailers, cable and satellite companies, as well as individual consumers and relate to its subscription, technology, and hardware revenues. Additionally, amounts due from banks for customer credit card, debit card and EBT transactions that take in excess...

  • Page 76
    ...income tax purposes. Goodwill is tested for impairment on an annual basis in the fourth quarter of our fiscal year using a two-step model. Management has determined that the Company has one reporting unit. The Company has the option to first assess qualitative factors to determine whether events and...

  • Page 77
    ... contract support (PCS), TiVo-enabled DVRs, non-DVR set-top boxes (STBs), and TiVo service; and bundled sales of advertising and audience research measurement services. The Company allocates revenue to each element in a multiple-element arrangement based upon its relative selling price. The Company...

  • Page 78
    ... The Company sells the DVR and service directly to end-users through bundled sales programs through the TiVo website. Under these bundled programs, the customer receives a DVR and commits to a minimum subscription period of one year for monthly payment plans (monthly program) or for the lifetime of...

  • Page 79
    ...the award. Tdvertising Costs The Company expenses advertising costs related to its products and service as incurred. Marketing co-op development payments, where the Company receives, or will receive, an identifiable benefit (goods or services) in exchange for the amount paid to its customer, and the...

  • Page 80
    ... to provide warranty services on its hardware products. The Company's warranty reserve liability is calculated as the total volume of unit sales over the warranty period, multiplied by the expected rate of warranty returns (based on historical experience) multiplied by the estimated cost to replace...

  • Page 81
    ... with TiVo or otherwise fails to perform their obligations in a timely manner, the Company may be delayed or prevented from commercializing its products and services. Recent Tccounting Pronouncements On May 28, 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, which...

  • Page 82
    ... Commercial paper Corporate debt securities U.S. Treasury securities Foreign government securities Variable-rate demand notes Asset and mortgage-backed securities Municipal bonds Current marketable debt securities Other investment securities: Other investment securities - cost method Total other...

  • Page 83
    ...Company's investments in marketable securities designated as available-for-sale: Ts of January 31, 2015 Tdjusted Cost Certificates of deposit Commercial paper Corporate debt securities Foreign government securities Variable-rate demand notes Asset and mortgage-backed securities Municipal Bonds Total...

  • Page 84
    ...data, if available, when determining fair value. TiVo recognizes transfers between levels of the hierarchy based on the fair values of the respective financial instruments at the end of the reporting period in which the transfer occurred. Cash equivalents and available-for-sale marketable securities...

  • Page 85
    ...(in thousands) Tssets: Cash equivalents: Commercial paper Money market funds Short-term investments: Certificates of deposit Commercial paper Corporate debt securities U.S. Treasury securities Variable-rate demand notes Asset- and mortgage-backed securities Municipal bonds Total $ $ 72,268 $ 164,727...

  • Page 86
    ... treasury securities are measured at fair value using Level 1 inputs. Level 2 Measurements The Company uses inputs such as broker/dealer quotes, and other similar data, which are obtained from quoted market prices, independent pricing vendors, or other sources, to determine the ultimate fair value...

  • Page 87
    ... technology is included in the cost of service revenues and $1.5 million associated with the impairment of customer relationships and trade names is included sales and marketing expenses for the year ended January 31, 2014. The total expected future annual amortization expense related to developed...

  • Page 88
    ... of consumer purchase. Thereafter, consumers may exchange a TiVo-enabled DVR with a product defect for a variable charge. The one year warranty for parts is extended beyond one year for customers on monthly service plans who also use our latest Roamio DVRs for as long as such customers remain active...

  • Page 89
    ...United States Patent No. 7,729,940 entitled "Analyzing Return on Investment of Advertising Campaigns by Matching Multiple Data Sources" (the "940 Patent") and its affiliate Cavendish Square Holding B.V. brought a claim for breach of contract of a Voting Agreement. On June 6, 2012 TiVo Research filed...

  • Page 90
    ... Facilities Leases The Company leases its corporate headquarters, located in San Jose, California, comprising a total of 176,254 square feet of office space. The corporate headquarters houses its administrative, sales and marketing, customer service, and product development activities, under a lease...

  • Page 91
    ...including such events as a "change in control" or "termination of trading"). In such case, the repurchase price would be 100% of the principal amount of the notes plus accrued and unpaid interest, if any, to, but excluding, the fundamental change repurchase date. The Company pays cash interest at an...

  • Page 92
    ... until the close of business on the second scheduled trading day immediately preceding the applicable maturity date. The notes may not be redeemed by the Company prior to their maturity date. Upon conversion the Company will pay cash and, if applicable, deliver shares of its common stock, based on...

  • Page 93
    ... The Directors' Plan provides for the automatic grant of options to purchase shares of the Company's common stock to non-employee directors at a price equal to the fair market value of the stock at the date of the grant. Initial options granted to new directors vest monthly over two years from the...

  • Page 94
    ... each year. Under the Employee Stock Purchase Plan, the Board may, in the future, specify offerings up to 27 months. As of January 31, 2015, the total number of shares reserved for issuance under this plan is 10,000,000. As of January 31, 2015, 1,262,822 shares remain available for future purchases...

  • Page 95
    ... table is based on options with an exercise price less than the Company's closing stock price of $10.46 as of January 31, 2015, which would have been received by the option holders had those option holders exercised their options as of that date. Total intrinsic value of options exercised was...

  • Page 96
    ... RSAs and RSUs has been deducted from the shares available for grant under the Company's stock option plans. Aggregate intrinsic value of RSAs and RSUs at January 31, 2015 was $47.7 million based on the Company's closing stock price on January 31, 2015. The total fair value of RSAs and RSUs vested...

  • Page 97
    ...COMPENSTTION Total stock-based compensation for the twelve months ended January 31, 2015, 2014, and 2013, respectively is as follows: Fiscal Year Ended January 31, 2015 Cost of service revenues Cost of technology revenues Cost of hardware revenues Research and development Sales and marketing General...

  • Page 98
    ... years ending January 31, 2015, we have made open-market purchases totaling 37,588,207 shares of our common stock for an aggregate purchase price of $460 million. On September 5, 2014, our board of directors authorized the current discretionary share repurchase program that allows for total new...

  • Page 99
    ...tax at statutory rate State taxes Stock based compensation Federal research tax credit Non-deductible compensation expense Non-deductible expenses and other Foreign withholding tax Domestic manufacturing deduction Change in valuation allowance Total tax expense (benefit) $ 2014 2013 (1,480) 778 (318...

  • Page 100
    ...Company accounts for the indirect effects of stock-based awards on other tax attributes, such as research tax credits, through the consolidated statements of operations. The tax benefit realized from excess stock options exercised and restricted stock units vested for the year ended January 31, 2015...

  • Page 101
    ... years. Since the timing of resolution and closure of the Company's open tax years is highly uncertain, the Company does not believe that the unrecognized tax benefits would materially change in the next twelve months. 16. NET INCOME (LOSS) PER COMMON SHTRE Basic net income (loss) per common share...

  • Page 102
    ... would have been anti-dilutive: Ts of January 31, 2015 2014 2013 Unvested restricted stock Options to purchase common stock Potential shares to be issued from employee stock purchase plan 4.0% Notes due 2016 2.0% Notes due 2021 Common stock warrants Total 219 377,432 - - 4,839,255 4,839,255 10,056...

  • Page 103
    ...patents that Verizon had asserted against TiVo (U.S. Patent Nos. 5,410,344, 5,635,979, 5,973,684, 6,367,078, 7,561,214 and 6,381,748), to make, have made, use, sell, offer to sell and import advanced television technology in connection with TiVo products and services, including products and services...

  • Page 104
    ... Time Warner Cable (as described in TiVo's periodic reports filed with the Securities and Exchange Commission ), provide licenses to certain patents between the parties, and release patent infringement claims between the parties with respect to all outstanding litigation in exchange for a payment...

  • Page 105
    ... cloud-based Software-as-a-Service company. Digitalsmiths' results of operations and the estimated fair value of assets acquired and liabilities assumed were included in the Company's consolidated financial statements beginning February 14, 2014. A total of $756,000 of acquisition costs were...

  • Page 106
    ... business combination (in thousands, except years): Description Software technology Customer relationships Trade name In process research and development Total identifiable intangible assets Tsset Life in years 6 10 6 N/A $ $ $ $ $ Fair Value 14,100 37,000 1,400 200 52,700 The Company's management...

  • Page 107
    ... Net revenues Cost of revenues Cost of service revenues Cost of technology revenues Cost of hardware revenues Total cost of revenues Gross margin Operating expenses Research and development Sales and marketing Sales and marketing, subscription acquisition costs General and administrative Litigation...

  • Page 108
    ...Financial Officer, as appropriate, to allow timely decisions regarding required disclosure, and (ii) is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and forms. (b) Management's report on internal control over financial...

  • Page 109
    ... public accounting firm, which has audited the consolidated financial statements included in Part II, Item 8 of this report, has issued an audit report on our internal control over financial reporting, as of January 31, 2015, which is included herein. (c) Changes in internal control over financial...

  • Page 110
    Table of Contents The information required by this Item is incorporated by reference from our 2015 Proxy Statement under the heading "Independent Auditor Fees and Services." 109

  • Page 111
    ...68 69 71 73 Consolidated Statements of Stockholders' Equity Consolidated Statements of Cash Flows Notes to Consolidated Financial Statements (2) Financial Statement Schedules All financial statement schedules have been omitted, since the required information is not applicable or is not present in...

  • Page 112
    ... to 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: March 19, 2015 /S/ THOMAS S. ROGERS Thomas S. Rogers Chief Executive Officer 111

  • Page 113
    Table of Contents POWER OF TTTORNEY KNOW TLL PERSONS BY THESE PRESENTS, that ...-effective amendments) to this Report on Form 10-K, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys...

  • Page 114
    Table of Contents Signature Title Date /S/ THOMAS S. ROGERS Thomas S. Rogers Chief Executive Officer, President, and Director (Principal Executive Officer) March 19, 2015 /S/ NAVEEN CHOPRA Naveen Chopra Chief Financial Officer (Principal Financial Officer) March 19, 2015 /S/ PAVEL KOVAR ...

  • Page 115
    ..., as trustee. Global Note, dated September 22, 2014 between TiVo Inc. and Wells Fargo Bank, National Association, as trustee. Form of Indemnification Agreement between TiVo Inc. and its officers and directors. TiVo Inc. Amended & Restated 1999 Non-Employee Directors' Stock Option Plan and related...

  • Page 116
    ...National Association, as Trustee. Settlement and Patent License between TiVo Inc. and DISH Network Corporation and EchoStar Corporation, dated as of April 29, 2011. Mutual Termination Agreement between TiVo Inc., on the one hand, and Comcast Corporation and Comcast STB DVR Software LLC, on the other...

  • Page 117
    .... Management contract or compensatory plan or arrangement. The certifications attached as Exhibits 32.1 and 32.2 that accompany this Annual Report on Form 10-K, are not deemed filed with the Securities and Exchange Commission and are not to be incorporated by reference into any filing of TiVo Inc...

  • Page 118
    ... January 31, 2015 and 2014, and the related consolidated statements of operations, comprehensive income (loss), stockholders' equity, and cash flows for each of the years in the three-year period ended January 31, 2015, and the effectiveness of internal control over financial reporting as of January...

  • Page 119
    ...'s ability to record, process, summarize and report financial information; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: March 19, 2015 /S/ THOMAS S. ROGERS...

  • Page 120
    ...'s ability to record, process, summarize and report financial information; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: March 19, 2015 /s/ NAVEEN CHOPRA...

  • Page 121
    ... Act of 2002 In connection with the TiVo Inc. (the "Company") Annual Report on Form 10-K for the year ending January 31, 2015 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 pursuant to 18...

  • Page 122
    ...-Oxley Act of 2002 In connection with the TiVo Inc. (the "Company") Annual Report on Form 10-K for the year ending January 31, 2015 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Naveen Chopra, Chief Financial Officer of the Company, certify pursuant to 18...

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