x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Large accelerated filer
þ
|
Accelerated filer
o
|
Non-accelerated filer
o
|
Smaller reporting company
o
|
Emerging growth company
o
|
|
(in thousands)
|
Outstanding as of
|
Class
|
October 31, 2018
|
Common Stock
|
123,927
|
PART I. FINANCIAL INFORMATION
|
||
ITEM 1.
|
||
|
||
|
||
|
||
|
||
|
||
ITEM 2.
|
||
ITEM 3.
|
||
ITEM 4.
|
||
|
||
PART II. OTHER INFORMATION
|
||
ITEM 1.
|
||
ITEM 1A.
|
||
ITEM 2.
|
||
ITEM 3.
|
||
ITEM 4.
|
||
ITEM 5.
|
||
ITEM 6.
|
||
|
|
September 30, 2018
|
|
December 31, 2017
|
||||
ASSETS
|
(Unaudited)
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
149,655
|
|
|
$
|
128,965
|
|
Short-term marketable securities
|
162,073
|
|
|
140,866
|
|
||
Accounts receivable, net
|
173,749
|
|
|
180,768
|
|
||
Inventory
|
7,963
|
|
|
11,581
|
|
||
Prepaid expenses and other current assets
|
36,012
|
|
|
40,719
|
|
||
Total current assets
|
529,452
|
|
|
502,899
|
|
||
Long-term marketable securities
|
70,296
|
|
|
82,711
|
|
||
Property and equipment, net
|
50,689
|
|
|
55,244
|
|
||
Intangible assets, net
|
524,057
|
|
|
643,924
|
|
||
Goodwill
|
1,813,183
|
|
|
1,813,227
|
|
||
Other long-term assets
|
57,104
|
|
|
65,673
|
|
||
Total assets
|
$
|
3,044,781
|
|
|
$
|
3,163,678
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable and accrued expenses
|
$
|
92,557
|
|
|
$
|
135,852
|
|
Unearned revenue
|
49,667
|
|
|
55,393
|
|
||
Current portion of long-term debt
|
7,000
|
|
|
7,000
|
|
||
Total current liabilities
|
149,224
|
|
|
198,245
|
|
||
Taxes payable, less current portion
|
4,694
|
|
|
3,947
|
|
||
Unearned revenue, less current portion
|
50,356
|
|
|
58,283
|
|
||
Long-term debt, less current portion
|
982,801
|
|
|
976,095
|
|
||
Deferred tax liabilities, net
|
51,150
|
|
|
50,356
|
|
||
Other long-term liabilities
|
14,982
|
|
|
23,736
|
|
||
Total liabilities
|
1,253,207
|
|
|
1,310,662
|
|
||
Commitments and contingencies (Note 11)
|
|
|
|
|
|
||
Stockholders' equity:
|
|
|
|
||||
Preferred stock, $0.001 par value, 5,000 shares authorized; no shares issued or outstanding
|
—
|
|
|
—
|
|
||
Common stock, $0.001 par value, 250,000 shares authorized; 125,629 shares issued and 123,875 shares outstanding as of September 30, 2018; and 123,385 shares issued and 122,116 shares outstanding as of December 31, 2017
|
126
|
|
|
123
|
|
||
Treasury stock, 1,754 shares and 1,269 shares as of September 30, 2018 and December 31, 2017, respectively, at cost
|
(31,495
|
)
|
|
(24,740
|
)
|
||
Additional paid-in capital
|
3,249,615
|
|
|
3,273,022
|
|
||
Accumulated other comprehensive loss
|
(4,297
|
)
|
|
(2,738
|
)
|
||
Accumulated deficit
|
(1,422,375
|
)
|
|
(1,392,651
|
)
|
||
Total stockholders’ equity
|
1,791,574
|
|
|
1,853,016
|
|
||
Total liabilities and stockholders’ equity
|
$
|
3,044,781
|
|
|
$
|
3,163,678
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenues, net:
|
|
|
|
|
|
|
|
||||||||
Licensing, services and software
|
$
|
160,783
|
|
|
$
|
188,031
|
|
|
$
|
516,495
|
|
|
$
|
577,545
|
|
Hardware
|
3,926
|
|
|
9,867
|
|
|
10,911
|
|
|
34,675
|
|
||||
Total Revenues, net
|
164,709
|
|
|
197,898
|
|
|
527,406
|
|
|
612,220
|
|
||||
Costs and expenses:
|
|
|
|
|
|
|
|
||||||||
Cost of licensing, services and software revenues, excluding depreciation and amortization of intangible assets
|
40,749
|
|
|
42,811
|
|
|
126,547
|
|
|
124,398
|
|
||||
Cost of hardware revenues, excluding depreciation and amortization of intangible assets
|
4,220
|
|
|
9,889
|
|
|
14,260
|
|
|
35,877
|
|
||||
Research and development
|
42,053
|
|
|
48,872
|
|
|
133,894
|
|
|
144,386
|
|
||||
Selling, general and administrative
|
39,867
|
|
|
47,431
|
|
|
133,906
|
|
|
147,121
|
|
||||
Depreciation
|
5,338
|
|
|
5,015
|
|
|
16,252
|
|
|
15,869
|
|
||||
Amortization of intangible assets
|
37,242
|
|
|
41,722
|
|
|
119,463
|
|
|
125,100
|
|
||||
Restructuring and asset impairment charges
|
2,921
|
|
|
3,710
|
|
|
8,568
|
|
|
17,623
|
|
||||
Total costs and expenses
|
172,390
|
|
|
199,450
|
|
|
552,890
|
|
|
610,374
|
|
||||
Operating (loss) income
|
(7,681
|
)
|
|
(1,552
|
)
|
|
(25,484
|
)
|
|
1,846
|
|
||||
Interest expense
|
(12,436
|
)
|
|
(10,990
|
)
|
|
(36,241
|
)
|
|
(31,827
|
)
|
||||
Interest income and other, net
|
861
|
|
|
1,059
|
|
|
2,971
|
|
|
3,819
|
|
||||
Gain (loss) on interest rate swaps
|
1,033
|
|
|
(39
|
)
|
|
7,185
|
|
|
(1,374
|
)
|
||||
TiVo Acquisition litigation
|
—
|
|
|
(1,100
|
)
|
|
—
|
|
|
(14,006
|
)
|
||||
Loss on debt extinguishment
|
—
|
|
|
—
|
|
|
—
|
|
|
(108
|
)
|
||||
Loss on debt modification
|
—
|
|
|
—
|
|
|
—
|
|
|
(929
|
)
|
||||
Loss from continuing operations before income taxes
|
(18,223
|
)
|
|
(12,622
|
)
|
|
(51,569
|
)
|
|
(42,579
|
)
|
||||
Income tax expense
|
4,769
|
|
|
4,341
|
|
|
13,305
|
|
|
13,816
|
|
||||
Loss from continuing operations, net of tax
|
(22,992
|
)
|
|
(16,963
|
)
|
|
(64,874
|
)
|
|
(56,395
|
)
|
||||
Income from discontinued operations, net of tax
|
143
|
|
|
—
|
|
|
3,738
|
|
|
—
|
|
||||
Net loss
|
$
|
(22,849
|
)
|
|
$
|
(16,963
|
)
|
|
$
|
(61,136
|
)
|
|
$
|
(56,395
|
)
|
|
|
|
|
|
|
|
|
||||||||
Basic loss per share:
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
$
|
(0.19
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
(0.53
|
)
|
|
$
|
(0.47
|
)
|
Discontinued operations
|
—
|
|
|
—
|
|
|
0.03
|
|
|
—
|
|
||||
Basic loss per share
|
$
|
(0.19
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
(0.50
|
)
|
|
$
|
(0.47
|
)
|
Weighted average shares used in computing basic per share amounts
|
123,459
|
|
|
120,935
|
|
|
122,756
|
|
|
119,994
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Diluted loss per share:
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
$
|
(0.19
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
(0.53
|
)
|
|
$
|
(0.47
|
)
|
Discontinued operations
|
—
|
|
|
—
|
|
|
0.03
|
|
|
—
|
|
||||
Diluted loss per share
|
$
|
(0.19
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
(0.50
|
)
|
|
$
|
(0.47
|
)
|
Weighted average shares used in computing diluted per share amounts
|
123,459
|
|
|
120,935
|
|
|
122,756
|
|
|
119,994
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Dividends declared per share
|
$
|
0.18
|
|
|
$
|
0.18
|
|
|
$
|
0.54
|
|
|
$
|
0.54
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net loss
|
$
|
(22,849
|
)
|
|
$
|
(16,963
|
)
|
|
$
|
(61,136
|
)
|
|
$
|
(56,395
|
)
|
Other comprehensive (loss) income, net of tax:
|
|
|
|
|
|
|
|
||||||||
Change in foreign currency translation adjustment
|
(286
|
)
|
|
267
|
|
|
(1,889
|
)
|
|
3,394
|
|
||||
Unrealized gains on marketable securities
|
|
|
|
|
|
|
|
||||||||
Change in unrealized gains on marketable securities
|
222
|
|
|
82
|
|
|
114
|
|
|
351
|
|
||||
Less: Reclassification adjustment on sale
|
—
|
|
|
—
|
|
|
216
|
|
|
—
|
|
||||
Other comprehensive (loss) income, net of tax
|
(64
|
)
|
|
349
|
|
|
(1,559
|
)
|
|
3,745
|
|
||||
Comprehensive loss
|
$
|
(22,913
|
)
|
|
$
|
(16,614
|
)
|
|
$
|
(62,695
|
)
|
|
$
|
(52,650
|
)
|
|
Nine Months Ended September 30,
|
||||||
|
2018
|
|
2017
|
||||
Cash flows from operating activities:
|
|
|
|
||||
Net loss
|
$
|
(61,136
|
)
|
|
$
|
(56,395
|
)
|
Adjustments to reconcile net loss to net cash provided by operating activities:
|
|
|
|
||||
Income from discontinued operations, net of tax
|
(3,738
|
)
|
|
—
|
|
||
Depreciation
|
16,252
|
|
|
15,869
|
|
||
Amortization of intangible assets
|
119,463
|
|
|
125,100
|
|
||
Amortization of convertible note discount and note issuance costs
|
11,586
|
|
|
11,016
|
|
||
Restructuring and asset impairment charges
|
8,568
|
|
|
17,623
|
|
||
Equity-based compensation
|
28,226
|
|
|
38,781
|
|
||
Change in fair value of interest rate swaps
|
(10,245
|
)
|
|
(5,102
|
)
|
||
TiVo Acquisition litigation
|
—
|
|
|
14,006
|
|
||
Loss on debt extinguishment
|
—
|
|
|
108
|
|
||
Loss on debt modification
|
—
|
|
|
929
|
|
||
Deferred income taxes
|
(447
|
)
|
|
1,035
|
|
||
Other operating, net
|
1,819
|
|
|
(3,358
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
30,548
|
|
|
(42,155
|
)
|
||
Inventory
|
3,618
|
|
|
1,476
|
|
||
Prepaid expenses and other current assets and other long-term assets
|
7,377
|
|
|
(58,411
|
)
|
||
Accounts payable and accrued expenses and other long-term liabilities
|
(35,237
|
)
|
|
(29,680
|
)
|
||
Taxes payable
|
(474
|
)
|
|
2,141
|
|
||
Unearned revenue
|
(2,445
|
)
|
|
18,276
|
|
||
Net cash provided by operating activities of continuing operations
|
113,735
|
|
|
51,259
|
|
||
Net cash provided by operating activities of discontinued operations
|
—
|
|
|
—
|
|
||
Net cash provided by operating activities
|
113,735
|
|
|
51,259
|
|
||
Cash flows from investing activities:
|
|
|
|
||||
Payments for purchase of short- and long-term marketable securities
|
(150,583
|
)
|
|
(121,979
|
)
|
||
Proceeds from sales or maturities of short- and long-term marketable securities
|
142,753
|
|
|
150,261
|
|
||
Return of cash paid for TiVo Acquisition
|
—
|
|
|
25,143
|
|
||
Payment to Dissenting Holders in TiVo Acquisition
|
—
|
|
|
(117,030
|
)
|
||
Payments for purchase of property and equipment
|
(17,053
|
)
|
|
(22,534
|
)
|
||
Payments for purchase of patents
|
—
|
|
|
(2,000
|
)
|
||
Other investing, net
|
15
|
|
|
(67
|
)
|
||
Net cash used in investing activities
|
(24,868
|
)
|
|
(88,206
|
)
|
||
Cash flows used in financing activities:
|
|
|
|
||||
Proceeds from issuance of long-term debt, net of issuance costs
|
—
|
|
|
681,552
|
|
||
Principal payments on long-term debt
|
(5,250
|
)
|
|
(687,750
|
)
|
||
Payments for dividends
|
(66,687
|
)
|
|
(65,238
|
)
|
||
Payments for contingent consideration and deferred holdback
|
(1,874
|
)
|
|
(2,650
|
)
|
||
Payments for withholding taxes related to net settlement of restricted awards
|
(6,755
|
)
|
|
(12,784
|
)
|
||
Proceeds from employee stock purchase plan and exercise of employee stock options
|
12,854
|
|
|
22,364
|
|
||
Net cash used in financing activities
|
(67,712
|
)
|
|
(64,506
|
)
|
||
Effect of exchange rate changes on cash and cash equivalents
|
(465
|
)
|
|
1,613
|
|
||
Net increase (decrease) in cash and cash equivalents
|
20,690
|
|
|
(99,840
|
)
|
||
Cash and cash equivalents at beginning of period
|
128,965
|
|
|
192,627
|
|
||
Cash and cash equivalents at end of period
|
$
|
149,655
|
|
|
$
|
92,787
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||||
Raw materials
|
$
|
1,042
|
|
|
$
|
1,846
|
|
Finished goods
|
6,921
|
|
|
9,735
|
|
||
Inventory
|
$
|
7,963
|
|
|
$
|
11,581
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||||
Computer software and equipment
|
$
|
158,490
|
|
|
$
|
150,098
|
|
Leasehold improvements
|
45,303
|
|
|
44,981
|
|
||
Furniture and fixtures
|
9,971
|
|
|
9,137
|
|
||
Property and equipment, gross
|
213,764
|
|
|
204,216
|
|
||
Less: Accumulated depreciation and amortization
|
(163,075
|
)
|
|
(148,972
|
)
|
||
Property and equipment, net
|
$
|
50,689
|
|
|
$
|
55,244
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||||
Accounts payable
|
$
|
10,828
|
|
|
$
|
10,517
|
|
Accrued compensation and benefits
|
33,566
|
|
|
47,886
|
|
||
Other accrued liabilities
|
48,163
|
|
|
77,449
|
|
||
Accounts payable and accrued expenses
|
$
|
92,557
|
|
|
$
|
135,852
|
|
|
|
|
Contracts with Customers
|
|
Costs to Obtain Contracts with Customers
|
|
De-recognition of Prepaid Stored Value Product Liabilities
|
|
|
||||||||||
|
December 31, 2017
|
|
|
|
|
January 1, 2018
|
|||||||||||||
Accounts receivable, net
|
$
|
180,768
|
|
|
$
|
24,177
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
204,945
|
|
Prepaid expenses and other current assets
|
40,719
|
|
|
(2,705
|
)
|
|
525
|
|
|
—
|
|
|
38,539
|
|
|||||
Other long-term assets
|
65,673
|
|
|
(4,419
|
)
|
|
819
|
|
|
—
|
|
|
62,073
|
|
|||||
Accounts payable and accrued expenses
|
(135,852
|
)
|
|
—
|
|
|
—
|
|
|
2,155
|
|
|
(133,697
|
)
|
|||||
Unearned revenue
|
(55,393
|
)
|
|
11,208
|
|
|
—
|
|
|
—
|
|
|
(44,185
|
)
|
|||||
Deferred tax liabilities, net
|
(50,356
|
)
|
|
(348
|
)
|
|
—
|
|
|
—
|
|
|
(50,704
|
)
|
|||||
Accumulated deficit
|
1,392,651
|
|
|
(27,913
|
)
|
|
(1,344
|
)
|
|
(2,155
|
)
|
|
1,361,239
|
|
|
Three Months Ended September 30, 2018
|
||||||||||
|
As Reported
|
|
As If Applying Prior Guidance
|
|
Effect of Change
Higher/(Lower) |
||||||
Total Revenues, net
|
$
|
164,709
|
|
|
$
|
170,868
|
|
|
$
|
(6,159
|
)
|
Cost of licensing, services and software revenues, excluding depreciation and amortization of intangible assets
|
40,749
|
|
|
41,512
|
|
|
(763
|
)
|
|||
Selling, general and administrative
|
39,867
|
|
|
40,195
|
|
|
(328
|
)
|
|||
Loss from continuing operations before income taxes
|
(18,223
|
)
|
|
(13,155
|
)
|
|
(5,068
|
)
|
|||
Income tax expense
|
4,769
|
|
|
5,143
|
|
|
(374
|
)
|
|||
Loss from continuing operations, net of tax
|
(22,992
|
)
|
|
(18,298
|
)
|
|
(4,694
|
)
|
|
Nine Months Ended September 30, 2018
|
||||||||||
|
As Reported
|
|
As If Applying Prior Guidance
|
|
Effect of Change
Higher/(Lower) |
||||||
Total Revenues, net
|
$
|
527,406
|
|
|
$
|
543,871
|
|
|
$
|
(16,465
|
)
|
Cost of licensing, services and software revenues, excluding depreciation and amortization of intangible assets
|
126,547
|
|
|
128,458
|
|
|
(1,911
|
)
|
|||
Selling, general and administrative
|
133,906
|
|
|
134,232
|
|
|
(326
|
)
|
|||
Loss from continuing operations before income taxes
|
(51,569
|
)
|
|
(37,341
|
)
|
|
(14,228
|
)
|
|||
Income tax expense
|
13,305
|
|
|
14,460
|
|
|
(1,155
|
)
|
|||
Loss from continuing operations, net of tax
|
(64,874
|
)
|
|
(51,801
|
)
|
|
(13,073
|
)
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||
AT&T Inc. ("AT&T")
|
11
|
%
|
|
14
|
%
|
|
10
|
%
|
|
14
|
%
|
|
Three Months Ended September 30, 2018
|
||||||||||
|
Product
|
|
Intellectual Property Licensing
|
|
Total Revenues, net
|
||||||
Goods and services transferred at a point in time
|
$
|
22,093
|
|
|
$
|
26,528
|
|
|
$
|
48,621
|
|
Goods and services transferred over time
|
72,519
|
|
|
39,768
|
|
|
112,287
|
|
|||
Out-of-license settlements
|
—
|
|
|
3,801
|
|
|
3,801
|
|
|||
Total Revenues, net
|
$
|
94,612
|
|
|
$
|
70,097
|
|
|
$
|
164,709
|
|
|
Nine Months Ended September 30, 2018
|
||||||||||
|
Product
|
|
Intellectual Property Licensing
|
|
Total Revenues, net
|
||||||
Goods and services transferred at a point in time
|
$
|
79,569
|
|
|
$
|
81,977
|
|
|
$
|
161,546
|
|
Goods and services transferred over time
|
224,682
|
|
|
125,212
|
|
|
349,894
|
|
|||
Out-of-license settlements
|
—
|
|
|
15,966
|
|
|
15,966
|
|
|||
Total Revenues, net
|
$
|
304,251
|
|
|
$
|
223,155
|
|
|
$
|
527,406
|
|
|
Three Months Ended September 30, 2018
|
|
Nine Months Ended September 30, 2018
|
||||
United States
|
$
|
115,312
|
|
|
$
|
351,423
|
|
United Kingdom
|
9,131
|
|
|
56,361
|
|
||
Rest of the world
|
40,266
|
|
|
119,622
|
|
||
Total Revenues, net
|
$
|
164,709
|
|
|
$
|
527,406
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||||
Accounts receivable, gross
|
$
|
176,499
|
|
|
$
|
183,343
|
|
Less: Allowance for doubtful accounts
|
(2,750
|
)
|
|
(2,575
|
)
|
||
Accounts receivable, net
|
$
|
173,749
|
|
|
$
|
180,768
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||
AT&T
|
16
|
%
|
|
28
|
%
|
Virgin Media
|
11
|
%
|
|
(a)
|
|
|
September 30, 2018
|
|
January 1, 2018
|
||||
Accounts receivable, net
|
$
|
46,154
|
|
|
$
|
68,858
|
|
Prepaid expenses and other current assets
|
1,527
|
|
|
1,167
|
|
||
Other long-term assets
|
7,988
|
|
|
6,783
|
|
||
Total contract assets, net
|
$
|
55,669
|
|
|
$
|
76,808
|
|
|
September 30, 2018
|
||||||||||||||
|
Amortized Cost
|
|
Unrealized
Gains |
|
Unrealized
Losses |
|
Fair Value
|
||||||||
Cash
|
$
|
45,530
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
45,530
|
|
Cash equivalents - Money market funds
|
104,125
|
|
|
—
|
|
|
—
|
|
|
104,125
|
|
||||
Cash and cash equivalents
|
$
|
149,655
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
149,655
|
|
|
|
|
|
|
|
|
|
||||||||
Corporate debt securities
|
$
|
115,765
|
|
|
$
|
4
|
|
|
$
|
(420
|
)
|
|
$
|
115,349
|
|
U.S. Treasuries / Agencies
|
117,298
|
|
|
—
|
|
|
(278
|
)
|
|
117,020
|
|
||||
Marketable securities
|
$
|
233,063
|
|
|
$
|
4
|
|
|
$
|
(698
|
)
|
|
$
|
232,369
|
|
Cash, cash equivalents and marketable securities
|
|
|
|
|
|
|
$
|
382,024
|
|
|
December 31, 2017
|
||||||||||||||
|
Amortized Cost
|
|
Unrealized
Gains |
|
Unrealized
Losses |
|
Fair Value
|
||||||||
Cash
|
$
|
38,996
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
38,996
|
|
Cash equivalents - Money market funds
|
89,969
|
|
|
—
|
|
|
—
|
|
|
89,969
|
|
||||
Cash and cash equivalents
|
$
|
128,965
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
128,965
|
|
|
|
|
|
|
|
|
|
||||||||
Auction rate securities
|
$
|
10,800
|
|
|
$
|
—
|
|
|
$
|
(216
|
)
|
|
$
|
10,584
|
|
Corporate debt securities
|
102,794
|
|
|
—
|
|
|
(397
|
)
|
|
102,397
|
|
||||
Foreign government obligations
|
2,249
|
|
|
—
|
|
|
(4
|
)
|
|
2,245
|
|
||||
U.S. Treasuries / Agencies
|
108,781
|
|
|
—
|
|
|
(430
|
)
|
|
108,351
|
|
||||
Marketable securities
|
$
|
224,624
|
|
|
$
|
—
|
|
|
$
|
(1,047
|
)
|
|
$
|
223,577
|
|
Cash, cash equivalents and marketable securities
|
|
|
|
|
|
|
$
|
352,542
|
|
|
Amortized Cost
|
|
Fair Value
|
||||
Due in less than 1 year
|
$
|
162,530
|
|
|
$
|
162,073
|
|
Due in 1-2 years
|
70,533
|
|
|
70,296
|
|
||
Total
|
$
|
233,063
|
|
|
$
|
232,369
|
|
•
|
Level 1.
Quoted prices in active markets for identical assets or liabilities.
|
•
|
Level 2.
Inputs other than Level 1 inputs that are observable for the asset or liability, either directly or indirectly, such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, or market-corroborated inputs.
|
•
|
Level 3.
Unobservable inputs for the asset or liability.
|
|
September 30, 2018
|
||||||||||||||
|
Total
|
|
Quoted Prices in
Active Markets (Level 1) |
|
Significant Other
Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
104,125
|
|
|
$
|
104,125
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Short-term marketable securities
|
|
|
|
|
|
|
|
||||||||
Corporate debt securities
|
85,785
|
|
|
—
|
|
|
85,785
|
|
|
—
|
|
||||
U.S. Treasuries / Agencies
|
76,288
|
|
|
—
|
|
|
76,288
|
|
|
—
|
|
||||
Prepaid expenses and other current assets
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
231
|
|
|
—
|
|
|
231
|
|
|
—
|
|
||||
Long-term marketable securities
|
|
|
|
|
|
|
|
||||||||
Corporate debt securities
|
29,564
|
|
|
—
|
|
|
29,564
|
|
|
—
|
|
||||
U.S. Treasuries / Agencies
|
40,732
|
|
|
—
|
|
|
40,732
|
|
|
—
|
|
||||
Other long-term assets
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
440
|
|
|
—
|
|
|
440
|
|
|
—
|
|
||||
Total Assets
|
$
|
337,165
|
|
|
$
|
104,125
|
|
|
$
|
233,040
|
|
|
$
|
—
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Other long-term liabilities
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
$
|
(145
|
)
|
|
$
|
—
|
|
|
$
|
(145
|
)
|
|
$
|
—
|
|
Total Liabilities
|
$
|
(145
|
)
|
|
$
|
—
|
|
|
$
|
(145
|
)
|
|
$
|
—
|
|
|
December 31, 2017
|
||||||||||||||
|
Total
|
|
Quoted Prices in
Active Markets (Level 1) |
|
Significant Other
Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
89,969
|
|
|
$
|
89,969
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Short-term marketable securities
|
|
|
|
|
|
|
|
||||||||
Corporate debt securities
|
49,396
|
|
|
—
|
|
|
49,396
|
|
|
—
|
|
||||
Foreign government obligations
|
2,245
|
|
|
—
|
|
|
2,245
|
|
|
—
|
|
||||
U.S. Treasuries / Agencies
|
89,225
|
|
|
—
|
|
|
89,225
|
|
|
—
|
|
||||
Long-term marketable securities
|
|
|
|
|
|
|
|
||||||||
Auction rate securities
|
10,584
|
|
|
—
|
|
|
—
|
|
|
10,584
|
|
||||
Corporate debt securities
|
53,001
|
|
|
—
|
|
|
53,001
|
|
|
—
|
|
||||
U.S. Treasuries / Agencies
|
19,126
|
|
|
—
|
|
|
19,126
|
|
|
—
|
|
||||
Total Assets
|
$
|
313,546
|
|
|
$
|
89,969
|
|
|
$
|
212,993
|
|
|
$
|
10,584
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Accounts payable and accrued expenses
|
|
|
|
|
|
|
|
||||||||
Cubiware contingent consideration
|
$
|
(2,234
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(2,234
|
)
|
Other long-term liabilities
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
(9,735
|
)
|
|
—
|
|
|
(9,735
|
)
|
|
—
|
|
||||
Total Liabilities
|
$
|
(11,969
|
)
|
|
$
|
—
|
|
|
$
|
(9,735
|
)
|
|
$
|
(2,234
|
)
|
|
Three Months Ended September 30,
|
||||||||||
|
2018
|
|
2017
|
||||||||
|
Cubiware Contingent Consideration
|
|
Auction Rate Securities
|
|
Cubiware Contingent Consideration
|
||||||
Balance at beginning of period
|
$
|
(3,599
|
)
|
|
$
|
10,584
|
|
|
$
|
(5,715
|
)
|
Settlements
|
1,874
|
|
|
—
|
|
|
2,650
|
|
|||
Transfers out (a)
|
1,700
|
|
|
—
|
|
|
—
|
|
|||
Gain (loss) included in earnings
|
25
|
|
|
—
|
|
|
(386
|
)
|
|||
Balance at end of period
|
$
|
—
|
|
|
$
|
10,584
|
|
|
$
|
(3,451
|
)
|
|
Nine Months Ended September 30,
|
||||||||||||||
|
2018
|
|
2017
|
||||||||||||
|
Auction Rate Securities
|
|
Cubiware Contingent Consideration
|
|
Auction Rate Securities
|
|
Cubiware Contingent Consideration
|
||||||||
Balance at beginning of period
|
$
|
10,584
|
|
|
$
|
(2,234
|
)
|
|
$
|
10,368
|
|
|
$
|
(5,273
|
)
|
Sales
|
(10,715
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Settlements
|
—
|
|
|
1,874
|
|
|
—
|
|
|
2,650
|
|
||||
Transfers out (a)
|
—
|
|
|
1,700
|
|
|
—
|
|
|
—
|
|
||||
Gain (loss) included in earnings
|
(85
|
)
|
|
(1,340
|
)
|
|
—
|
|
|
(828
|
)
|
||||
Unrealized loss reclassified on sale
|
216
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Unrealized gains included in other comprehensive income
|
—
|
|
|
—
|
|
|
216
|
|
|
—
|
|
||||
Balance at end of period
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
10,584
|
|
|
$
|
(3,451
|
)
|
(a)
|
During the
three and nine months ended September 30, 2018
,
$1.7 million
related to the
Cubiware contingent consideration
was reclassified to a contingent liability that is not measured at fair value.
|
|
September 30, 2018
|
|
December 31, 2017
|
||||||||||||
|
Carrying Amount
|
|
Fair Value (a)
|
|
Carrying Amount
|
|
Fair Value (a)
|
||||||||
2020 Convertible Notes
|
$
|
322,849
|
|
|
$
|
328,412
|
|
|
$
|
311,766
|
|
|
$
|
326,888
|
|
2021 Convertible Notes
|
48
|
|
|
48
|
|
|
48
|
|
|
48
|
|
||||
Term Loan Facility B
|
666,904
|
|
|
668,574
|
|
|
671,281
|
|
|
679,722
|
|
||||
Total Long-term debt
|
$
|
989,801
|
|
|
$
|
997,034
|
|
|
$
|
983,095
|
|
|
$
|
1,006,658
|
|
(a)
|
The fair value of debt issued or assumed by the Company is estimated using quoted prices for the identical instrument in a market that is not active and considers interest rates currently available to companies of similar credit standing for similar terms and remaining maturities and considers the nonperformance risk of the Company. If reported at fair value in the
Condensed Consolidated Balance Sheets
, debt issued or assumed by the Company would be classified in Level 2 of the fair value hierarchy.
|
|
Product
|
|
Intellectual Property Licensing
|
|
Total
|
||||||
December 31, 2017
|
$
|
521,895
|
|
|
$
|
1,291,332
|
|
|
$
|
1,813,227
|
|
Foreign currency translation
|
(44
|
)
|
|
—
|
|
|
(44
|
)
|
|||
September 30, 2018
|
$
|
521,851
|
|
|
$
|
1,291,332
|
|
|
$
|
1,813,183
|
|
|
September 30, 2018
|
||||||||||
|
Gross
|
|
Accumulated
Amortization |
|
Net
|
||||||
Finite-lived intangible assets
|
|
|
|
|
|
||||||
Developed technology and patents
|
$
|
1,034,085
|
|
|
$
|
(742,956
|
)
|
|
$
|
291,129
|
|
Existing contracts and customer relationships
|
402,896
|
|
|
(190,692
|
)
|
|
212,204
|
|
|||
Content databases and other
|
57,157
|
|
|
(50,433
|
)
|
|
6,724
|
|
|||
Trademarks / Tradenames
|
8,300
|
|
|
(8,300
|
)
|
|
—
|
|
|||
Total finite-lived intangible assets
|
1,502,438
|
|
|
(992,381
|
)
|
|
510,057
|
|
|||
Indefinite-lived intangible assets
|
|
|
|
|
|
||||||
TiVo Tradename
|
14,000
|
|
|
—
|
|
|
14,000
|
|
|||
Total intangible assets
|
$
|
1,516,438
|
|
|
$
|
(992,381
|
)
|
|
$
|
524,057
|
|
|
December 31, 2017
|
||||||||||
|
Gross
|
|
Accumulated
Amortization |
|
Net
|
||||||
Finite-lived intangible assets
|
|
|
|
|
|
||||||
Developed technology and patents
|
$
|
1,034,458
|
|
|
$
|
(676,465
|
)
|
|
$
|
357,993
|
|
Existing contracts and customer relationships
|
403,244
|
|
|
(139,289
|
)
|
|
263,955
|
|
|||
Content databases and other
|
57,053
|
|
|
(49,077
|
)
|
|
7,976
|
|
|||
Trademarks / Tradenames
|
8,300
|
|
|
(8,300
|
)
|
|
—
|
|
|||
Total finite-lived intangible assets
|
1,503,055
|
|
|
(873,131
|
)
|
|
629,924
|
|
|||
Indefinite-lived intangible assets
|
|
|
|
|
|
||||||
TiVo Tradename
|
14,000
|
|
|
—
|
|
|
14,000
|
|
|||
Total intangible assets
|
$
|
1,517,055
|
|
|
$
|
(873,131
|
)
|
|
$
|
643,924
|
|
Remainder of 2018
|
$
|
27,763
|
|
2019
|
109,855
|
|
|
2020
|
109,109
|
|
|
2021
|
66,341
|
|
|
2022
|
38,602
|
|
|
Thereafter
|
158,387
|
|
|
Total
|
$
|
510,057
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Facility-related costs
|
$
|
99
|
|
|
$
|
3,034
|
|
|
$
|
387
|
|
|
$
|
4,244
|
|
Severance costs
|
2,822
|
|
|
220
|
|
|
5,606
|
|
|
4,260
|
|
||||
Share-based payments
|
—
|
|
|
456
|
|
|
2,575
|
|
|
2,374
|
|
||||
Contract termination costs
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
||||
Asset impairment
|
—
|
|
|
—
|
|
|
—
|
|
|
6,741
|
|
||||
Restructuring and asset impairment charges
|
$
|
2,921
|
|
|
$
|
3,710
|
|
|
$
|
8,568
|
|
|
$
|
17,623
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||||
Facility-related costs
|
$
|
459
|
|
|
$
|
693
|
|
Severance costs
|
3,337
|
|
|
584
|
|
||
Contract termination costs
|
—
|
|
|
37
|
|
||
Accrued restructuring costs
|
$
|
3,796
|
|
|
$
|
1,314
|
|
|
Balance at Beginning of Period
|
|
Restructuring Expense
|
|
Cash Settlements
|
|
Non-Cash Settlements
|
|
Other
|
|
Balance at End of Period
|
||||||||||||
Facility-related costs
|
$
|
—
|
|
|
$
|
47
|
|
|
$
|
(47
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Severance costs
|
—
|
|
|
5,478
|
|
|
(2,276
|
)
|
|
—
|
|
|
(11
|
)
|
|
3,191
|
|
||||||
Share-based payments
|
—
|
|
|
2,575
|
|
|
—
|
|
|
(2,575
|
)
|
|
—
|
|
|
—
|
|
||||||
Total
|
$
|
—
|
|
|
$
|
8,100
|
|
|
$
|
(2,323
|
)
|
|
$
|
(2,575
|
)
|
|
$
|
(11
|
)
|
|
$
|
3,191
|
|
|
Balance at Beginning of Period
|
|
Restructuring Expense
|
|
Cash Settlements
|
|
Other
|
|
Balance at End of Period
|
||||||||||
Facility-related costs
|
$
|
111
|
|
|
$
|
280
|
|
|
$
|
(165
|
)
|
|
$
|
(39
|
)
|
|
$
|
187
|
|
Severance costs
|
448
|
|
|
127
|
|
|
(564
|
)
|
|
1
|
|
|
12
|
|
|||||
Total
|
$
|
559
|
|
|
$
|
407
|
|
|
$
|
(729
|
)
|
|
$
|
(38
|
)
|
|
$
|
199
|
|
|
|
|
|
September 30, 2018
|
|
December 31, 2017
|
||||||||||
|
Stated Interest Rate
|
Issue Date
|
Maturity Date
|
Outstanding Principal
|
Carrying Amount
|
|
Outstanding Principal
|
Carrying Amount
|
||||||||
2020 Convertible Notes
|
0.500%
|
March 4, 2015
|
March 1, 2020
|
$
|
345,000
|
|
$
|
322,849
|
|
|
$
|
345,000
|
|
$
|
311,766
|
|
2021 Convertible Notes
|
2.000%
|
September 22, 2014
|
October 1, 2021
|
48
|
|
48
|
|
|
48
|
|
48
|
|
||||
Term Loan Facility B
|
Variable
|
July 2, 2014
|
July 2, 2021
|
670,250
|
|
666,904
|
|
|
675,500
|
|
671,281
|
|
||||
Total Long-term debt
|
|
|
|
$
|
1,015,298
|
|
989,801
|
|
|
$
|
1,020,548
|
|
983,095
|
|
||
Less: Current portion of long-term debt
|
|
|
|
|
7,000
|
|
|
|
7,000
|
|
||||||
Long-term debt, less current portion
|
|
|
|
|
$
|
982,801
|
|
|
|
$
|
976,095
|
|
•
|
during any calendar quarter commencing after the calendar quarter ending on June 30, 2015 (and only during such calendar quarter), if the last reported sale price of
TiVo Corporation
's common stock for at least
20
trading days (whether or not consecutive) during the period of
30
consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to
130%
of the conversion price on each applicable trading day;
|
•
|
during the
five
business day period after any
ten
consecutive trading day period in which the trading price per
$1,000
of principal of
2020 Convertible Notes
for each trading day was less than
98%
of the product of the last reported sale price of
TiVo Corporation
’s common stock and the conversion rate on each such trading day; or
|
•
|
on the occurrence of specified corporate events.
|
|
September 30, 2018
|
|
December 31, 2017
|
||||
Liability component
|
|
|
|
||||
Principal outstanding
|
$
|
345,000
|
|
|
$
|
345,000
|
|
Less: Unamortized debt discount
|
(19,622
|
)
|
|
(29,499
|
)
|
||
Less: Unamortized debt issuance costs
|
(2,529
|
)
|
|
(3,735
|
)
|
||
Carrying amount
|
$
|
322,849
|
|
|
$
|
311,766
|
|
|
|
|
|
||||
Equity component
|
$
|
63,854
|
|
|
$
|
63,854
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Stated interest
|
$
|
431
|
|
|
$
|
431
|
|
|
$
|
1,294
|
|
|
$
|
1,294
|
|
Amortization of debt discount
|
3,331
|
|
|
3,179
|
|
|
9,877
|
|
|
9,428
|
|
||||
Amortization of debt issuance costs
|
412
|
|
|
374
|
|
|
1,206
|
|
|
1,093
|
|
||||
Total interest expense
|
$
|
4,174
|
|
|
$
|
3,984
|
|
|
$
|
12,377
|
|
|
$
|
11,815
|
|
Remainder of 2018
|
$
|
1,750
|
|
2019 (a)
|
352,000
|
|
|
2020
|
7,000
|
|
|
2021
|
654,548
|
|
|
Total
|
$
|
1,015,298
|
|
(a)
|
While the
2020 Convertible Notes
are scheduled to mature on March 1, 2020, future principal payments are presented based on the date the
2020 Convertible Notes
can be freely converted by holders, which is
December 1, 2019
. However, the
2020 Convertible Notes
may be converted by holders prior to
December 1, 2019
in certain circumstances.
|
|
|
|
Notional
|
|
|
|||||
Contract Inception
|
Contract Effective Date
|
Contract Maturity
|
September 30, 2018
|
December 31, 2017
|
Interest Rate Paid
|
Interest Rate Received
|
||||
Senior Secured Credit Facility
|
|
|
|
|
||||||
June 2013
|
January 2016
|
March 2019
|
$
|
250,000
|
|
$
|
250,000
|
|
2.23%
|
One-month USD-LIBOR
|
September 2014
|
January 2016
|
July 2021
|
$
|
125,000
|
|
$
|
125,000
|
|
2.66%
|
One-month USD-LIBOR
|
September 2014
|
March 2017
|
July 2021
|
$
|
200,000
|
|
$
|
200,000
|
|
2.93%
|
One-month USD-LIBOR
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||
Weighted average shares used in computing basic per share amounts
|
123,459
|
|
|
120,935
|
|
|
122,756
|
|
|
119,994
|
|
Dilutive effect of equity-based compensation awards
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Weighted average shares used in computing diluted per share amounts
|
123,459
|
|
|
120,935
|
|
|
122,756
|
|
|
119,994
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||
Restricted awards
|
5,401
|
|
|
5,234
|
|
|
4,153
|
|
|
4,444
|
|
Stock options
|
1,907
|
|
|
2,544
|
|
|
2,238
|
|
|
3,004
|
|
2020 Convertible Notes (a)
|
12,918
|
|
|
12,294
|
|
|
12,918
|
|
|
12,294
|
|
2021 Convertible Notes (a)
|
1
|
|
|
1
|
|
|
1
|
|
|
1
|
|
Warrants related to 2020 Convertible Notes (a)
|
12,525
|
|
|
12,079
|
|
|
12,424
|
|
|
12,079
|
|
Weighted average potential shares excluded from the calculation of Diluted EPS
|
32,752
|
|
|
32,152
|
|
|
31,734
|
|
|
31,822
|
|
(a)
|
See
Note 10
for additional details.
|
|
Common stock
|
Treasury stock
|
Additional paid-in capital
|
Accumulated other comprehensive loss
|
Accumulated deficit
|
Total stockholders’ equity
|
||||||||||||||||
|
Shares
|
Amount
|
Shares
|
Amount
|
||||||||||||||||||
Balance as of June 30, 2018
|
124,528
|
|
$
|
125
|
|
(1,557
|
)
|
$
|
(28,925
|
)
|
$
|
3,257,093
|
|
$
|
(4,233
|
)
|
$
|
(1,399,526
|
)
|
$
|
1,824,534
|
|
Net loss
|
|
|
|
|
|
|
(22,849
|
)
|
(22,849
|
)
|
||||||||||||
Other comprehensive income, net of tax
|
|
|
|
|
|
(64
|
)
|
|
(64
|
)
|
||||||||||||
Issuance of common stock under employee stock purchase plan
|
511
|
|
—
|
|
|
|
5,278
|
|
|
|
5,278
|
|
||||||||||
Issuance of restricted stock, net
|
590
|
|
1
|
|
|
|
—
|
|
|
|
1
|
|
||||||||||
Equity-based compensation
|
|
|
|
|
9,526
|
|
|
|
9,526
|
|
||||||||||||
Dividends
|
|
|
|
|
(22,282
|
)
|
|
|
(22,282
|
)
|
||||||||||||
Withholding taxes related to net share settlement of restricted stock units
|
|
|
(197
|
)
|
(2,570
|
)
|
|
|
|
(2,570
|
)
|
|||||||||||
Balance as of September 30, 2018
|
125,629
|
|
$
|
126
|
|
(1,754
|
)
|
$
|
(31,495
|
)
|
$
|
3,249,615
|
|
$
|
(4,297
|
)
|
$
|
(1,422,375
|
)
|
$
|
1,791,574
|
|
|
Common stock
|
Treasury stock
|
Additional paid-in capital
|
Accumulated other comprehensive loss
|
Accumulated deficit
|
Total stockholders’ equity
|
||||||||||||||||
|
Shares
|
Amount
|
Shares
|
Amount
|
||||||||||||||||||
Balance as of December 31, 2017
|
123,385
|
|
$
|
123
|
|
(1,269
|
)
|
$
|
(24,740
|
)
|
$
|
3,273,022
|
|
$
|
(2,738
|
)
|
$
|
(1,392,651
|
)
|
$
|
1,853,016
|
|
Cumulative effect adjustment (a)
|
|
|
|
|
|
|
31,412
|
|
31,412
|
|
||||||||||||
Net loss
|
|
|
|
|
|
|
(61,136
|
)
|
(61,136
|
)
|
||||||||||||
Other comprehensive income, net of tax
|
|
|
|
|
|
(1,559
|
)
|
|
(1,559
|
)
|
||||||||||||
Issuance of common stock under employee stock purchase plan
|
1,150
|
|
2
|
|
|
|
12,852
|
|
|
|
12,854
|
|
||||||||||
Issuance of restricted stock, net
|
1,094
|
|
1
|
|
|
|
—
|
|
|
|
1
|
|
||||||||||
Equity-based compensation
|
|
|
|
|
30,252
|
|
|
|
30,252
|
|
||||||||||||
Dividends
|
|
|
|
|
(66,511
|
)
|
|
|
(66,511
|
)
|
||||||||||||
Withholding taxes related to net share settlement of restricted stock units
|
|
|
(485
|
)
|
(6,755
|
)
|
|
|
|
(6,755
|
)
|
|||||||||||
Balance as of September 30, 2018
|
125,629
|
|
$
|
126
|
|
(1,754
|
)
|
$
|
(31,495
|
)
|
$
|
3,249,615
|
|
$
|
(4,297
|
)
|
$
|
(1,422,375
|
)
|
$
|
1,791,574
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||
Restricted stock units subject to market conditions
|
|
|
|
|
|
|
|
||||
Expected volatility
|
39.2
|
%
|
|
53.1
|
%
|
|
39.2
|
%
|
|
53.1
|
%
|
Expected term
|
2.5 years
|
|
|
2.5 years
|
|
|
2.5 years
|
|
|
2.5 years
|
|
Risk-free interest rate
|
2.6
|
%
|
|
1.5
|
%
|
|
2.6
|
%
|
|
1.5
|
%
|
Expected dividend yield
|
5.5
|
%
|
|
3.9
|
%
|
|
5.5
|
%
|
|
3.9
|
%
|
ESPP shares
|
|
|
|
|
|
|
|
||||
Expected volatility
|
44.3
|
%
|
|
42.2
|
%
|
|
43.5
|
%
|
|
42.0
|
%
|
Expected term
|
1.3 years
|
|
|
1.3 years
|
|
|
1.3 years
|
|
|
1.3 years
|
|
Risk-free interest rate
|
2.5
|
%
|
|
1.3
|
%
|
|
2.2
|
%
|
|
1.1
|
%
|
Expected dividend yield
|
6.1
|
%
|
|
3.9
|
%
|
|
5.7
|
%
|
|
2.4
|
%
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Weighted average grant date fair value
|
|
|
|
|
|
|
|
||||||||
Restricted awards
|
$
|
11.55
|
|
|
$
|
17.05
|
|
|
$
|
11.72
|
|
|
$
|
17.48
|
|
ESPP shares
|
$
|
3.67
|
|
|
$
|
5.78
|
|
|
$
|
3.94
|
|
|
$
|
5.70
|
|
|
|
|
|
|
|
|
|
||||||||
Equity-based compensation
|
|
|
|
|
|
|
|
||||||||
Pre-tax equity-based compensation, excluding amounts included in restructuring expense
|
$
|
9,471
|
|
|
$
|
13,007
|
|
|
$
|
28,226
|
|
|
$
|
38,781
|
|
Pre-tax equity-based compensation, included in restructuring expense
|
$
|
—
|
|
|
$
|
456
|
|
|
$
|
2,575
|
|
|
$
|
2,374
|
|
|
Restricted Awards (In Thousands)
|
|
Weighted-Average Grant Date Fair Value
|
|||
Outstanding as of beginning of period
|
5,899
|
|
|
$
|
17.78
|
|
Granted
|
3,339
|
|
|
$
|
11.72
|
|
Vested
|
(1,552
|
)
|
|
$
|
20.41
|
|
Forfeited
|
(2,135
|
)
|
|
$
|
15.02
|
|
Outstanding as of end of period
|
5,551
|
|
|
$
|
14.46
|
|
|
Options (In Thousands)
|
|
Weighted-Average Exercise Price
|
|
Weighted-Average Remaining Contractual Term
|
|
Aggregate Intrinsic Value (In Thousands)
|
|||||
Outstanding as of beginning of period
|
2,368
|
|
|
$
|
27.16
|
|
|
|
|
|
||
Forfeited and expired
|
(497
|
)
|
|
$
|
36.45
|
|
|
|
|
|
||
Outstanding as of end of period
|
1,871
|
|
|
$
|
24.69
|
|
|
1.2 years
|
|
$
|
—
|
|
Vested and expected to vest as of September 30, 2018
|
1,871
|
|
|
$
|
24.69
|
|
|
1.2 years
|
|
$
|
—
|
|
Exercisable as of September 30, 2018
|
1,825
|
|
|
$
|
24.71
|
|
|
1.2 years
|
|
$
|
—
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Foreign withholding tax
|
$
|
3,566
|
|
|
$
|
4,106
|
|
|
$
|
10,635
|
|
|
$
|
11,118
|
|
State income tax
|
42
|
|
|
(992
|
)
|
|
221
|
|
|
143
|
|
||||
Foreign income tax
|
18
|
|
|
252
|
|
|
578
|
|
|
996
|
|
||||
Change in net deferred tax liabilities
|
213
|
|
|
691
|
|
|
(277
|
)
|
|
1,372
|
|
||||
Change in unrecognized tax benefits
|
62
|
|
|
(64
|
)
|
|
59
|
|
|
(8
|
)
|
||||
Transition Tax
|
868
|
|
|
—
|
|
|
868
|
|
|
—
|
|
||||
Change in indefinite reinvestment assertion
|
—
|
|
|
—
|
|
|
1,221
|
|
|
—
|
|
||||
Release of deferred tax asset valuation allowance
|
—
|
|
|
348
|
|
|
—
|
|
|
195
|
|
||||
Income tax expense
|
$
|
4,769
|
|
|
$
|
4,341
|
|
|
$
|
13,305
|
|
|
$
|
13,816
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Product
|
|
|
|
|
|
|
|
||||||||
Platform Solutions
|
$
|
73,147
|
|
|
$
|
82,244
|
|
|
$
|
241,295
|
|
|
$
|
253,398
|
|
Software and Services
|
19,851
|
|
|
20,718
|
|
|
57,949
|
|
|
65,739
|
|
||||
Other
|
1,614
|
|
|
628
|
|
|
5,007
|
|
|
3,859
|
|
||||
Revenues, net
|
94,612
|
|
|
103,590
|
|
|
304,251
|
|
|
322,996
|
|
||||
Adjusted Operating Expenses (1)
|
79,347
|
|
|
91,307
|
|
|
250,280
|
|
|
280,314
|
|
||||
Adjusted EBITDA (2)
|
15,265
|
|
|
12,283
|
|
|
53,971
|
|
|
42,682
|
|
||||
Intellectual Property Licensing
|
|
|
|
|
|
|
|
||||||||
US Pay TV Providers
|
44,474
|
|
|
63,288
|
|
|
143,606
|
|
|
195,365
|
|
||||
CE Manufacturers
|
8,859
|
|
|
15,479
|
|
|
26,754
|
|
|
38,296
|
|
||||
New Media, International Pay TV Providers and Other
|
16,764
|
|
|
15,541
|
|
|
52,795
|
|
|
55,563
|
|
||||
Revenues, net
|
70,097
|
|
|
94,308
|
|
|
223,155
|
|
|
289,224
|
|
||||
Adjusted Operating Expenses (1)
|
23,461
|
|
|
24,243
|
|
|
73,790
|
|
|
69,247
|
|
||||
Adjusted EBITDA (2)
|
46,636
|
|
|
70,065
|
|
|
149,365
|
|
|
219,977
|
|
||||
Corporate
|
|
|
|
|
|
|
|
||||||||
Adjusted Operating Expenses (1)
|
14,825
|
|
|
15,851
|
|
|
45,385
|
|
|
47,084
|
|
||||
Adjusted EBITDA (2)
|
(14,825
|
)
|
|
(15,851
|
)
|
|
(45,385
|
)
|
|
(47,084
|
)
|
||||
Consolidated
|
|
|
|
|
|
|
|
||||||||
Total Revenues, net
|
164,709
|
|
|
197,898
|
|
|
527,406
|
|
|
612,220
|
|
||||
Adjusted Operating Expenses (1)
|
117,633
|
|
|
131,401
|
|
|
369,455
|
|
|
396,645
|
|
||||
Adjusted EBITDA (2)
|
47,076
|
|
|
66,497
|
|
|
157,951
|
|
|
215,575
|
|
||||
Depreciation
|
5,338
|
|
|
5,015
|
|
|
16,252
|
|
|
15,869
|
|
||||
Amortization of intangible assets
|
37,242
|
|
|
41,722
|
|
|
119,463
|
|
|
125,100
|
|
||||
Restructuring and asset impairment charges
|
2,921
|
|
|
3,710
|
|
|
8,568
|
|
|
17,623
|
|
||||
Equity-based compensation
|
9,471
|
|
|
13,007
|
|
|
28,226
|
|
|
38,781
|
|
||||
Transition and integration costs
|
(148
|
)
|
|
3,394
|
|
|
9,303
|
|
|
15,701
|
|
||||
Earnout amortization
|
—
|
|
|
958
|
|
|
1,494
|
|
|
2,875
|
|
||||
CEO transition cash costs
|
—
|
|
|
—
|
|
|
(975
|
)
|
|
—
|
|
||||
Remeasurement of contingent consideration
|
(67
|
)
|
|
243
|
|
|
1,104
|
|
|
317
|
|
||||
Gain on settlement of acquired receivable
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,537
|
)
|
||||
Operating (loss) income
|
(7,681
|
)
|
|
(1,552
|
)
|
|
(25,484
|
)
|
|
1,846
|
|
||||
Interest expense
|
(12,436
|
)
|
|
(10,990
|
)
|
|
(36,241
|
)
|
|
(31,827
|
)
|
||||
Interest income and other, net
|
861
|
|
|
1,059
|
|
|
2,971
|
|
|
3,819
|
|
||||
Gain (loss) on interest rate swaps
|
1,033
|
|
|
(39
|
)
|
|
7,185
|
|
|
(1,374
|
)
|
||||
TiVo Acquisition litigation
|
—
|
|
|
(1,100
|
)
|
|
—
|
|
|
(14,006
|
)
|
||||
Loss on debt extinguishment
|
—
|
|
|
—
|
|
|
—
|
|
|
(108
|
)
|
||||
Loss on debt modification
|
—
|
|
|
—
|
|
|
—
|
|
|
(929
|
)
|
||||
Loss from continuing operations before income taxes
|
$
|
(18,223
|
)
|
|
$
|
(12,622
|
)
|
|
$
|
(51,569
|
)
|
|
$
|
(42,579
|
)
|
(1)
|
Adjusted Operating Expenses is defined as operating expenses excluding
Depreciation
,
Amortization of intangible assets
,
Restructuring and asset impairment charges
,
Equity-based compensation
,
Transition and integration costs
, retention earn-outs payable to former shareholders of acquired businesses,
CEO transition cash costs
,
Remeasurement of contingent consideration
and
Gain on settlement of acquired receivable
.
|
(2)
|
Adjusted EBITDA is defined as operating income excluding
Depreciation
,
Amortization of intangible assets
,
Restructuring and asset impairment charges
,
Equity-based compensation
,
Transition and integration costs
, retention earn-outs payable to former shareholders of acquired businesses,
CEO transition cash costs
,
Remeasurement of contingent consideration
and
Gain on settlement of acquired receivable
.
|
|
Three Months Ended September 30,
|
|
|
|
|
|||||||||
|
2018
|
|
2017
|
|
Change $
|
|
Change %
|
|||||||
Revenues, net:
|
|
|
|
|
|
|
|
|||||||
Licensing, services and software
|
$
|
160,783
|
|
|
$
|
188,031
|
|
|
$
|
(27,248
|
)
|
|
(14
|
)%
|
Hardware
|
3,926
|
|
|
9,867
|
|
|
(5,941
|
)
|
|
(60
|
)%
|
|||
Total Revenues, net
|
164,709
|
|
|
197,898
|
|
|
(33,189
|
)
|
|
(17
|
)%
|
|||
Costs and expenses:
|
|
|
|
|
|
|
|
|||||||
Cost of licensing, services and software revenues, excluding depreciation and amortization of intangible assets
|
40,749
|
|
|
42,811
|
|
|
(2,062
|
)
|
|
(5
|
)%
|
|||
Cost of hardware revenues, excluding depreciation and amortization of intangible assets
|
4,220
|
|
|
9,889
|
|
|
(5,669
|
)
|
|
(57
|
)%
|
|||
Research and development
|
42,053
|
|
|
48,872
|
|
|
(6,819
|
)
|
|
(14
|
)%
|
|||
Selling, general and administrative
|
39,867
|
|
|
47,431
|
|
|
(7,564
|
)
|
|
(16
|
)%
|
|||
Depreciation
|
5,338
|
|
|
5,015
|
|
|
323
|
|
|
6
|
%
|
|||
Amortization of intangible assets
|
37,242
|
|
|
41,722
|
|
|
(4,480
|
)
|
|
(11
|
)%
|
|||
Restructuring and asset impairment charges
|
2,921
|
|
|
3,710
|
|
|
(789
|
)
|
|
(21
|
)%
|
|||
Total costs and expenses
|
172,390
|
|
|
199,450
|
|
|
(27,060
|
)
|
|
(14
|
)%
|
|||
Operating loss
|
(7,681
|
)
|
|
(1,552
|
)
|
|
(6,129
|
)
|
|
395
|
%
|
|||
Interest expense
|
(12,436
|
)
|
|
(10,990
|
)
|
|
(1,446
|
)
|
|
13
|
%
|
|||
Interest income and other, net
|
861
|
|
|
1,059
|
|
|
(198
|
)
|
|
(19
|
)%
|
|||
Gain (loss) on interest rate swaps
|
1,033
|
|
|
(39
|
)
|
|
1,072
|
|
|
(2,749
|
)%
|
|||
TiVo Acquisition litigation
|
—
|
|
|
(1,100
|
)
|
|
1,100
|
|
|
N/a
|
|
|||
Loss from continuing operations before income taxes
|
(18,223
|
)
|
|
(12,622
|
)
|
|
(5,601
|
)
|
|
44
|
%
|
|||
Income tax expense
|
4,769
|
|
|
4,341
|
|
|
428
|
|
|
10
|
%
|
|||
Loss from continuing operations, net of tax
|
(22,992
|
)
|
|
(16,963
|
)
|
|
(6,029
|
)
|
|
36
|
%
|
|||
Income from discontinued operations, net of tax
|
143
|
|
|
—
|
|
|
143
|
|
|
N/a
|
|
|||
Net loss
|
$
|
(22,849
|
)
|
|
$
|
(16,963
|
)
|
|
$
|
(5,886
|
)
|
|
35
|
%
|
|
Nine Months Ended September 30,
|
|
|
|
|
|||||||||
|
2018
|
|
2017
|
|
Change $
|
|
Change %
|
|||||||
Revenues, net:
|
|
|
|
|
|
|
|
|||||||
Licensing, services and software
|
$
|
516,495
|
|
|
$
|
577,545
|
|
|
$
|
(61,050
|
)
|
|
(11
|
)%
|
Hardware
|
10,911
|
|
|
34,675
|
|
|
(23,764
|
)
|
|
(69
|
)%
|
|||
Total Revenues, net
|
527,406
|
|
|
612,220
|
|
|
(84,814
|
)
|
|
(14
|
)%
|
|||
Costs and expenses:
|
|
|
|
|
|
|
|
|||||||
Cost of licensing, services and software revenues, excluding depreciation and amortization of intangible assets
|
126,547
|
|
|
124,398
|
|
|
2,149
|
|
|
2
|
%
|
|||
Cost of hardware revenues, excluding depreciation and amortization of intangible assets
|
14,260
|
|
|
35,877
|
|
|
(21,617
|
)
|
|
(60
|
)%
|
|||
Research and development
|
133,894
|
|
|
144,386
|
|
|
(10,492
|
)
|
|
(7
|
)%
|
|||
Selling, general and administrative
|
133,906
|
|
|
147,121
|
|
|
(13,215
|
)
|
|
(9
|
)%
|
|||
Depreciation
|
16,252
|
|
|
15,869
|
|
|
383
|
|
|
2
|
%
|
|||
Amortization of intangible assets
|
119,463
|
|
|
125,100
|
|
|
(5,637
|
)
|
|
(5
|
)%
|
|||
Restructuring and asset impairment charges
|
8,568
|
|
|
17,623
|
|
|
(9,055
|
)
|
|
(51
|
)%
|
|||
Total costs and expenses
|
552,890
|
|
|
610,374
|
|
|
(57,484
|
)
|
|
(9
|
)%
|
|||
Operating (loss) income
|
(25,484
|
)
|
|
1,846
|
|
|
(27,330
|
)
|
|
(1,480
|
)%
|
|||
Interest expense
|
(36,241
|
)
|
|
(31,827
|
)
|
|
(4,414
|
)
|
|
14
|
%
|
|||
Interest income and other, net
|
2,971
|
|
|
3,819
|
|
|
(848
|
)
|
|
(22
|
)%
|
|||
Gain (loss) on interest rate swaps
|
7,185
|
|
|
(1,374
|
)
|
|
8,559
|
|
|
(623
|
)%
|
|||
TiVo Acquisition litigation
|
—
|
|
|
(14,006
|
)
|
|
14,006
|
|
|
N/a
|
|
|||
Loss on debt extinguishment
|
—
|
|
|
(108
|
)
|
|
108
|
|
|
N/a
|
|
|||
Loss on debt modification
|
—
|
|
|
(929
|
)
|
|
929
|
|
|
N/a
|
|
|||
Loss from continuing operations before income taxes
|
(51,569
|
)
|
|
(42,579
|
)
|
|
(8,990
|
)
|
|
21
|
%
|
|||
Income tax expense
|
13,305
|
|
|
13,816
|
|
|
(511
|
)
|
|
(4
|
)%
|
|||
Loss from continuing operations, net of tax
|
(64,874
|
)
|
|
(56,395
|
)
|
|
(8,479
|
)
|
|
15
|
%
|
|||
Income from discontinued operations, net of tax
|
3,738
|
|
|
—
|
|
|
3,738
|
|
|
N/a
|
|
|||
Net loss
|
$
|
(61,136
|
)
|
|
$
|
(56,395
|
)
|
|
$
|
(4,741
|
)
|
|
8
|
%
|
|
Three Months Ended September 30,
|
|
|
|
|
|||||||||
|
2018
|
|
2017
|
|
Change $
|
|
Change %
|
|||||||
Platform Solutions
|
$
|
73,147
|
|
|
$
|
82,244
|
|
|
$
|
(9,097
|
)
|
|
(11
|
)%
|
Software and Services
|
19,851
|
|
|
20,718
|
|
|
(867
|
)
|
|
(4
|
)%
|
|||
Other
|
1,614
|
|
|
628
|
|
|
986
|
|
|
157
|
%
|
|||
Product Revenues
|
94,612
|
|
|
103,590
|
|
|
(8,978
|
)
|
|
(9
|
)%
|
|||
Adjusted Operating Expenses
|
79,347
|
|
|
91,307
|
|
|
(11,960
|
)
|
|
(13
|
)%
|
|||
Adjusted EBITDA
|
$
|
15,265
|
|
|
$
|
12,283
|
|
|
$
|
2,982
|
|
|
24
|
%
|
Adjusted EBITDA Margin
|
16.1
|
%
|
|
11.9
|
%
|
|
|
|
|
|
Nine Months Ended September 30,
|
|
|
|
|
|||||||||
|
2018
|
|
2017
|
|
Change $
|
|
Change %
|
|||||||
Platform Solutions
|
$
|
241,295
|
|
|
$
|
253,398
|
|
|
$
|
(12,103
|
)
|
|
(5
|
)%
|
Software and Services
|
57,949
|
|
|
65,739
|
|
|
(7,790
|
)
|
|
(12
|
)%
|
|||
Other
|
5,007
|
|
|
3,859
|
|
|
1,148
|
|
|
30
|
%
|
|||
Product Revenues
|
304,251
|
|
|
322,996
|
|
|
(18,745
|
)
|
|
(6
|
)%
|
|||
Adjusted Operating Expenses
|
250,280
|
|
|
280,314
|
|
|
(30,034
|
)
|
|
(11
|
)%
|
|||
Adjusted EBITDA
|
$
|
53,971
|
|
|
$
|
42,682
|
|
|
$
|
11,289
|
|
|
26
|
%
|
Adjusted EBITDA Margin
|
17.7
|
%
|
|
13.2
|
%
|
|
|
|
|
|
Three Months Ended September 30,
|
|
|
|
|
|||||||||
|
2018
|
|
2017
|
|
Change $
|
|
Change %
|
|||||||
US Pay TV Providers
|
$
|
44,474
|
|
|
$
|
63,288
|
|
|
$
|
(18,814
|
)
|
|
(30
|
)%
|
CE Manufacturers
|
8,859
|
|
|
15,479
|
|
|
(6,620
|
)
|
|
(43
|
)%
|
|||
New Media, International Pay TV Providers and Other
|
16,764
|
|
|
15,541
|
|
|
1,223
|
|
|
8
|
%
|
|||
Intellectual Property Licensing Revenues
|
70,097
|
|
|
94,308
|
|
|
(24,211
|
)
|
|
(26
|
)%
|
|||
Adjusted Operating Expenses
|
23,461
|
|
|
24,243
|
|
|
(782
|
)
|
|
(3
|
)%
|
|||
Adjusted EBITDA
|
$
|
46,636
|
|
|
$
|
70,065
|
|
|
$
|
(23,429
|
)
|
|
(33
|
)%
|
Adjusted EBITDA Margin
|
66.5
|
%
|
|
74.3
|
%
|
|
|
|
|
|
Nine Months Ended September 30,
|
|
|
|
|
|||||||||
|
2018
|
|
2017
|
|
Change $
|
|
Change %
|
|||||||
US Pay TV Providers
|
$
|
143,606
|
|
|
$
|
195,365
|
|
|
$
|
(51,759
|
)
|
|
(26
|
)%
|
CE Manufacturers
|
26,754
|
|
|
38,296
|
|
|
(11,542
|
)
|
|
(30
|
)%
|
|||
New Media, International Pay TV Providers and Other
|
52,795
|
|
|
55,563
|
|
|
(2,768
|
)
|
|
(5
|
)%
|
|||
Intellectual Property Licensing Revenues
|
223,155
|
|
|
289,224
|
|
|
(66,069
|
)
|
|
(23
|
)%
|
|||
Adjusted Operating Expenses
|
73,790
|
|
|
69,247
|
|
|
4,543
|
|
|
7
|
%
|
|||
Adjusted EBITDA
|
$
|
149,365
|
|
|
$
|
219,977
|
|
|
$
|
(70,612
|
)
|
|
(32
|
)%
|
Adjusted EBITDA Margin
|
66.9
|
%
|
|
76.1
|
%
|
|
|
|
|
|
Three Months Ended September 30,
|
|
|
|
|
|||||||||
|
2018
|
|
2017
|
|
Change $
|
|
Change %
|
|||||||
Adjusted Operating Expenses
|
$
|
14,825
|
|
|
$
|
15,851
|
|
|
$
|
(1,026
|
)
|
|
(6
|
)%
|
|
Nine Months Ended September 30,
|
|
|
|
|
|||||||||
|
2018
|
|
2017
|
|
Change $
|
|
Change %
|
|||||||
Adjusted Operating Expenses
|
$
|
45,385
|
|
|
$
|
47,084
|
|
|
$
|
(1,699
|
)
|
|
(4
|
)%
|
|
Nine Months Ended September 30,
|
|
|
|
|
|||||||||
|
2018
|
|
2017
|
|
Change $
|
|
Change %
|
|||||||
Net cash provided by operating activities of continuing operations
|
$
|
113,735
|
|
|
$
|
51,259
|
|
|
$
|
62,476
|
|
|
122
|
%
|
Net cash used in investing activities
|
(24,868
|
)
|
|
(88,206
|
)
|
|
63,338
|
|
|
(72
|
)%
|
|||
Net cash used in financing activities
|
(67,712
|
)
|
|
(64,506
|
)
|
|
(3,206
|
)
|
|
5
|
%
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
(465
|
)
|
|
1,613
|
|
|
(2,078
|
)
|
|
(129
|
)%
|
|||
Net increase (decrease) in cash and cash equivalents
|
$
|
20,690
|
|
|
$
|
(99,840
|
)
|
|
$
|
120,530
|
|
|
(121
|
)%
|
|
September 30, 2018
|
|
December 31, 2017
|
||||||||||||
|
Outstanding Principal
|
|
Carrying Amount
|
|
Outstanding Principal
|
|
Carrying Amount
|
||||||||
2020 Convertible Notes
|
$
|
345,000
|
|
|
$
|
322,849
|
|
|
$
|
345,000
|
|
|
$
|
311,766
|
|
2021 Convertible Notes
|
48
|
|
|
48
|
|
|
48
|
|
|
48
|
|
||||
Term Loan Facility B
|
670,250
|
|
|
666,904
|
|
|
675,500
|
|
|
671,281
|
|
||||
Total
|
$
|
1,015,298
|
|
|
$
|
989,801
|
|
|
$
|
1,020,548
|
|
|
$
|
983,095
|
|
•
|
during any calendar quarter commencing after the calendar quarter ending on June 30, 2015 (and only during such calendar quarter), if the last reported sale price of our common stock for at least
20
trading days (whether or not consecutive) during the period of
30
consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to
130%
of the conversion price on each applicable trading day;
|
•
|
during the
five
business day period after any
ten
consecutive trading day period in which the trading price per
$1,000
of principal of
2020 Convertible Notes
for each trading day was less than
98%
of the product of the last reported sale price of our common stock and the conversion rate on each such trading day; or
|
•
|
on the occurrence of specified corporate events.
|
Period
|
|
Total Number of Shares Purchased (1)
|
|
Average Price Paid Per Share (1)
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1)
|
|
Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (2)
|
||||||||
July 2018
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
150,000
|
|
||
August 2018
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
150,000
|
|
||
September 2018
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
150,000
|
|
||
Total
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
|
(1)
|
Excludes shares withheld to satisfy minimum statutory tax withholding requirements in connection with the net share settlement of restricted stock units. During the
three months ended September 30, 2018
, we withheld
0.2 million
shares of common stock to satisfy
$2.6 million
of required withholding taxes.
|
(2)
|
On
February 14, 2017
,
TiVo Corporation
's Board of Directors approved an increase to its common stock repurchase program authorization to
$150.0 million
. The February 2017 authorization includes amounts which were outstanding under previously authorized share repurchase programs.
|
|
|
|
|
Incorporated by Reference
|
|
|
||||
Exhibit Number
|
|
Exhibit Description
|
|
Company Form+
|
|
Filing
Date
|
|
Exhibit
Number
|
|
Filed Herewith
|
10.01
|
|
|
|
|
|
|
|
|
X
|
|
10.02
|
|
|
|
|
|
|
|
|
X
|
|
10.03
|
|
|
|
|
|
|
|
|
X
|
|
10.04
|
|
|
8-K
|
|
July 27, 2018
|
|
10.1
|
|
|
|
10.05
|
|
|
8-K
|
|
July 27, 2018
|
|
10.2
|
|
|
|
31.01
|
|
|
|
|
|
|
|
|
X
|
|
31.02
|
|
|
|
|
|
|
|
|
X
|
|
32.01
|
|
|
|
|
|
|
|
|
*
|
|
32.02
|
|
|
|
|
|
|
|
|
*
|
|
101.INS
|
|
XBRL Instance Document
|
|
|
|
|
|
|
|
X
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
|
|
|
|
X
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
|
|
|
|
X
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
|
|
|
|
X
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
|
|
|
|
X
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
|
|
|
|
X
|
*
|
Furnished herewith.
|
**
|
Management contract or compensatory plan or arrangement.
|
TIVO CORPORATION
|
|
|
Authorized Officer:
|
|
|
Date:
|
By:
|
/s/ Raghavendra Rau
|
November 7, 2018
|
|
Raghavendra Rau
|
|
|
Interim President and Chief Executive Officer
|
|
|
|
Principal Financial Officer:
|
|
|
Date:
|
By:
|
/s/ Peter C. Halt
|
November 7, 2018
|
|
Peter C. Halt
|
|
|
Chief Financial Officer
|
|
|
|
Principal Accounting Officer:
|
|
|
Date:
|
By:
|
/s/ Wesley Gutierrez
|
November 7, 2018
|
|
Wesley Gutierrez
|
|
|
Chief Accounting Officer and Treasurer
|
TiVo Corporation
|
Accepted by:
|
||
By:
|
|
PARTICIPANT
|
|
|
Name:
|
|
|
Title:
|
Chief Human Resources Officer
|
Signature:
|
|
Address:
|
2160 Gold Street
|
Date:
|
|
|
San Jose, CA 95002
|
|
|
TiVo Corporation
|
Accepted by:
|
||
By:
|
|
PARTICIPANT
|
|
|
Name:
|
|
|
Title:
|
Chief Human Resources Officer
|
Signature:
|
|
Address:
|
2160 Gold Street
|
Date:
|
|
|
San Jose, CA 95002
|
|
|
I.
|
INTRODUCTION
|
a.
|
The Objective of the 2018 Senior Executive Company Incentive Plan (the “Plan”) is to (i) enhance stockholder value by promoting strong linkages between executive contributions and company performance; (ii) support achievement of the business objectives of TiVo Corporation and its subsidiaries (the “Company”); and (iii) promote retention of participating employees of the Company.
|
b.
|
Participants:
This plan applies solely to the Chief Executive Officer and the senior executives reporting directly to the Chief Executive Officer at TiVo Corporation (the “Participants”).
|
c.
|
Effective Date:
This Plan is effective for the fiscal year 2018, beginning January 1, 2018 through December 31, 2018. This Plan is limited in time and expires automatically on December 31, 2018. All benefits under this Plan are voluntary benefits. Participation in this Plan during fiscal year 2018 does not convey any entitlement to participate in this or future plans or to the same or similar bonus payment benefits.
|
d.
|
Changes in the Plan:
The Company presently has no plans to change the Plan during the fiscal year. However, this plan is a voluntary benefit provided by the Company and by virtue of the fact that bonuses are not a contractual entitlement and are paid at the sole discretion of the Company, the Company reserves the right to modify the Plan, in total or in part, at any time. Any such change must be in writing and approved by the Compensation Committee of the Board of Directors. The Compensation Committee of the Board of Directors reserves the right to interpret the Plan document as needed and such interpretations shall be final, conclusive and binding on all persons, and shall be given the maximum deference permitted by law.
|
e.
|
Entire Agreement:
This Plan is the entire agreement between the Company and the employee regarding the subject matter of this Plan and supersedes all prior bonus or commission incentive plans, whether with TiVo Corporation or any subsidiary or affiliate thereof, or any written or verbal representations regarding the subject matter of this Plan.
|
II.
|
ELIGIBILITY AND INCENTIVE PLAN ELEMENTS
|
a.
|
Eligibility:
The Participants are eligible for the incentive payout if they meet the following requirements:
|
•
|
Except as otherwise explicitly set forth in the Participant’s Incentive Target Percentage Schedule (as defined below), are not currently on a sales incentive or commission plan or any other significant form of variable compensation (such as a services bonus plan); and
|
•
|
Are not on a performance improvement plan at the time of calculation and have not received a written notice of warning or other disciplinary action during the year that remains in effect at the time of calculation
|
b.
|
Calculation of Incentive:
With respect to each Participant, (1) the “Company Performance Incentive” shall mean the
|
c.
|
The Annual Base Salary
in effect at the end of the fiscal year represents the basis for the incentive calculation. Nothing in the Plan, or arising as a result of a Participant’s participation in the Plan, shall prevent the Company from changing a Participant’s Annual Base Salary at any time based on such factors as the Company in its sole discretion determines appropriate.
|
d.
|
Incentive Target Percentage
is a percentage level of Annual Base Salary determined by the employee’s position except as otherwise approved by the Compensation Committee of the Board of Directors.
|
e.
|
Individual Performance Factor (“IPF”)
is based on the manager’s evaluation of the employee’s accomplishments and contributions to TiVo’s business objectives for the fiscal year. Managers use the three “check-in ratings” given throughout the year as reference points to inform this evaluation.
This factor can range from 0 to 200% based on the Performance Rating of the individual.
|
f.
|
Company Performance Factor (“CPF”)
is based upon the Company achieving an established worldwide revenue target and a worldwide Adjusted EBITDA target per the 2018 operating plan approved by the Board of Directors of the Company. The applicable targets for fiscal year 2018 can be amended by the Compensation Committee of the Board of Directors at any time during the fiscal year. Notwithstanding anything to the contrary contained herein, the Compensation Committee of the Board of Directors has the discretion to determine to pay less than the full amount (including to pay zero percent) of the payout to which any Participant would otherwise be entitled, which determination shall be based upon such factors as the Compensation Committee of the Board of Directors determines appropriate (including without limitation as a result of the Company’s or a Participant’s failing to achieve one or more objectives with respect to the fiscal year). The Revenue and Adjusted EBITDA attainment percentages will be determined using a straight-line interpolation approach relative to the Threshold, Target and Maximum attainment set forth during the year. The Company Performance Factor will be determined using the table below, provided however that the Company Performance factor may be modified at the sole discretion of the Compensation Committee of the Board of Directors for any reason, including in the event that such Company Performance is due to an extraordinary or exceptional circumstance.
|
g.
|
CPF Formula.
The CPF payout equals the average of the payout of Revenue and Adjusted EBITDA. The plan provides for a Threshold payout of 50% relative to 90% attainment of Target. Below 90% of attainment, the plan provides for 0% payout. Between 90% and 100% attainment (Target) the plan provides for a straight-line interpolation of 5% points of payout for every 1% point of attainment. From 100% (Target) to 110% of attainment, the plan provides for 10% points of payout for every 1% point of attainment. The plan provides for a Maximum payout of 200% relative to 110% or more of attainment of Target. This is summarized in the table below.
|
|
Revenue
|
|
ADJUSTED EBITDA
|
||||
Attainment
|
Payout
|
Slope
|
|
Attainment
|
Payout
|
Slope
|
|
Threshold
|
90%
|
50%
|
5 pts
|
|
90%
|
50%
|
5 pts
|
Target
|
100%
|
100%
|
|
|
100%
|
100%
|
|
Max
|
110%
|
200%
|
10 pts
|
|
110%
|
200%
|
10 pts
|
h.
|
Business Group Performance Factor (“BGPF”)
is based on the Business Group achieving an established Business Group revenue target and contribution margin target that is approved by the Board of Directors of the Company. This factor will apply only to selected leaders in Advanced Media & Advertising, User Experience, Consumer and Metadata. This factor will not apply to employees in shared service areas such as IT, Finance, HR, Marketing, Legal etc. The applicable targets for fiscal year 2018 can be amended by the Compensation Committee of the Board of Directors at any time during the fiscal year. Notwithstanding anything to the contrary contained herein, the Compensation Committee of the Board of Directors has the discretion to determine to pay less than the full amount (including to pay zero percent) of the payout to which any Participant would otherwise be entitled, which determination shall be based upon such factors as the Compensation Committee of the Board of Directors determines appropriate (including without limitation as a result of the Business Group’s or a Participant’s failing to achieve one or more objectives with respect to the fiscal year). The Business Group Revenue and Business Group Non-GAAP Contribution Margin attainment percentages will be determined using a straight-line interpolation approach relative to the Threshold, Target and Maximum attainment set forth during the year. The BGPF will be determined using the table below, provided however, the BGPF may be modified at the sole discretion of the Compensation Committee of the Board of Directors for any reason, including in the event that such Business Performance is due to an extraordinary or exceptional circumstance.
|
i.
|
BGPF Formula.
The BGPF payout equals the average of the payout of the applicable Business Group Revenue and Business Group Non-GAAP Contribution Margin. The plan provides for a Threshold payout of 50% relative to 90% attainment of Target. Below 90% of attainment, the plan provides for 0% payout. Between 90% and 100% attainment (Target) the plan provides for a straight-line interpolation of 5% points of payout for every 1% point of attainment. From 100% (Target) to 110% of attainment, the plan provides for 10% points of payout for every 1% point of attainment. The plan provides for a Maximum payout of 200% relative to 110% or more of attainment of Target. This is summarized in the table below.
|
|
BG Revenue
|
|
BG Non-GAAP Contribution Margin
|
||||
Attainment
|
Payout
|
Slope
|
|
Attainment
|
Payout
|
Slope
|
|
Threshold
|
90%
|
50%
|
5 pts
|
|
90%
|
50%
|
5 pts
|
Target
|
100%
|
100%
|
|
|
100%
|
100%
|
|
Max
|
110%
|
200%
|
10 pts
|
|
110%
|
200%
|
10 pts
|
j.
|
Transfers and Terminations:
Any employee who is a Participant in the Plan and who transfers to a new position not governed by this Plan will be eligible on a pro-rata basis for the applicable period and paid as defined by the Plan. Employees who transfer into the Plan from another plan and/or from one Business Group to another will be subject to proration as well, and consequently will be eligible to receive an incentive payment based on their participation in this Plan during fiscal year 2018 applying the Proration Factors referred to below. Payments from the Plan are subject to reduction by advances, unearned commission advances, draws or prorations and appropriate withholdings. Any exceptions to the Plan must be in writing and approved by the Compensation Committee of the Board of Directors.
|
k.
|
Proration Factor
accounts for the number of calendar days during the fiscal year that the employee is in the incentive-eligible position. For example, the proration factor for an employee who has been on the Plan the entire year will be 1.00. For an employee who has been on the plan for 6 months, the factor will be 0.50. Employees in the following
|
•
|
Participants in the Plan who transferred to a new position not covered by the Plan
|
•
|
Employees who transferred from one incentive-eligible position to another incentive-eligible position. Employees in this situation will have their incentive prorated based on the length of time in each position.
|
•
|
Employees who have been in the Plan less than 12 months (such as a new hire)
|
•
|
Employees who have been on a leave of absence of any length during the fiscal year
|
•
|
Employees working less than the full time standard work week will receive an incentive prorated according to the following schedule:
|
Hours Worked
|
Incentive Eligibility
|
Less than full time > half time as defined by standard work week
|
Prorated according to the average number of hours worked
|
Less than half time of standard work week
|
Not incentive eligible
|
III.
|
PRACTICES AND PROCEDURES
|
a.
|
Procedure:
|
•
|
A copy of the Plan will be made available to each Participant.
|
•
|
All incentive payments will be made after all required or elected withholdings have been deducted.
|
b.
|
Governing Law:
This Plan is governed by the law of California and the parties hereby submit to the exclusive jurisdiction of the County of Santa Clara, California courts.
|
Position
|
Incentive Target
|
Company Performance Weighting
|
Individual Performance Weighting
|
Business Unit Performance Weighting
|
President & Chief Executive Officer
|
125%
|
100%
|
—%
|
—%
|
Chief Intellectual Property Officer
|
70%
|
75%
|
25%
|
—%
|
Chief Financial Officer
|
70%
|
75%
|
25%
|
—%
|
Chief Human Resources Officer
|
50%
|
75%
|
25%
|
—%
|
EVP, General Counsel and Chief Compliance Officer
|
55%
|
75%
|
25%
|
—%
|
EVP, Strategy and Corporate Development
|
55%
|
75%
|
25%
|
—%
|
SVP and GM, Advanced Media and Advertising
|
55%
|
20%
|
30%
|
50%
|
SVP & GM, User Experience & Consumer
|
55%
|
20%
|
30%
|
50%
|
SVP & GM, Metadata
|
55%
|
20%
|
30%
|
50%
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’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:
|
November 7, 2018
|
|
|
|
|
|
|
/s/ Raghavendra Rau
|
|
|
Raghavendra Rau
|
|
|
Interim President and Chief Executive Officer
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’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:
|
November 7, 2018
|
|
|
|
|
|
|
/s/ Peter C. Halt
|
|
|
Peter C. Halt
|
|
|
Chief Financial Officer
|
(a)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m(a) or 78o(d)), and
|
(b)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operation of the Company.
|
|
/s/ Raghavendra Rau
|
|
Raghavendra Rau
|
|
Interim President and Chief Executive Officer
|
(a)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m(a) or 78o(d)), and
|
(b)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operation of the Company.
|
|
/s/ Peter C. Halt
|
|
Peter C. Halt
|
|
Chief Financial Officer
|