TiVo 2015 Annual Report Download - page 38

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Table of Contents
ITEM 7. MANAGEMENT
’
S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following commentary should be read in conjunction with the Consolidated Financial Statements and related notes contained in Part IV of
this Annual Report on Form 10
-
K. This discussion contains forward
-
looking statements based on current expectations that involve risks and
uncertainties. Our actual results may differ materially from those anticipated in these forward
-
looking statements as a result of various factors,
including those set forth under Item 1A. "Risk Factors" included in Part I of this Annual Report on Form 10
-
K
.
Executive Overview of Results
Revenue for the year ended
December 31, 2015
decreased by 3% compared to the prior year as a result of a 1% decline in revenue in our
Intellectual Property Licensing segment and a 5% decline in revenue in our Product segment. For the year ended
December 31, 2015
,
27%
of revenue was
from our contracts with AT&T Inc. (including DIRECTV), Comcast and Time Warner Cable. In September 2015, the Company's contract with Time Warner
Cable was extended to March 2016 and in December 2015, our contract with AT&T (including DIRECTV) was extended to December 2022. Our contract with
Comcast expires in March 2016.
For the year ended
December 31, 2015
, our loss from continuing operations was
$4.3 million
, or
$0.05
of diluted loss per share, compared to a loss
from continuing operations of
$13.5 million
, or
$0.15
of diluted loss per share in the prior year. The improvement was primarily the result of a decrease in
costs incurred to restructure and service our debt portfolio and to restructure our operations, as well as the realization of savings from past restructuring
actions, including cost savings associated with lower research and development spending. These benefits were offset in part by lower revenue and an
increase in Selling, general and administrative expenses.
During the year ended
December 31, 2015
, we strengthened our financial position, improved our liquidity and secured additional resources that can
be strategically deployed by:
36
•
generating
$143.0 million
in operating cash flow from continuing operations,
•
issuing
$345.0 million
of par value of Convertible Senior Notes that mature March 1, 2020 (the “2020 Convertible Notes”
),
•
purchasing a convertible bond call option to manage the potential dilution to earnings per share associated with the 2020 Convertible Notes and
selling a warrant for a net cost of
$33.5 million
, the combined effect of which is to increase the effective conversion price of the 2020 Convertible
Notes
from
$28.9044
per share to
$40.1450
per share,
•
repurchasing
$291.0 million
of par value of our
2.625%
Convertible Senior Notes due in 2040 (the “2040 Convertible Notes”
),
•
extinguishing our Term Loan Facility A due in 2019 by making
$125.0 million
in voluntary principal prepayments,
•
terminating our
$175.0 million
revolving credit facility due in 2019, and
•
repurchasing
9.5 million
shares of our common stock for
$150.2 million
.