Which division of TiVo is most profitable?

Quote:

Originally Posted by ej42137 (Post 10332442) No! No! The more people that choose lifetime the less money that TiVo makes; every penny counts to keep the company operating! :D

I think as we all know that Hardware is the loss leader, and the attempt is simply to break even. There was a small (3.5%) drop in hardware sales.

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But in comparison to last year, service costs went up 27% while revenue service revenue only went up 7%.



Average TiVo-Owned subscriptions per month 930K 974K

TiVo-Owned ARPU per month $7.82 $8.03



So they lost 44K subscription over last year, and the Average Revenue Per Unit dropped 21 cents. The decrease in TiVo-Owned ARPU per month for the three months ended October 31, 2014 as compared to the same prior year period was due primarily to a percentage increase in sales of service for TiVo Mini, which have much lower average revenues than DVRs.



While the above quote is true, the company probably makes more revenue with monthly payments, their costs go up as well. The monthly payments are only 20% of service revenues, as the rest comes from lump sum lifetime, the cable companies that use TiVo and Media services. So it is hardly a make or break issue for the company.

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But the Technology department showed meteoric growth and reduced costs.



2014 2013 (first 9 months only)

$76,656 $79,487 Hardware revenues -3.56%

$70,464 $73,470 Hardware Cost -4.09%

$6,192 $6,017 Hardware Revenue minus Cost 2.91%



$109,509 $102,518 Service revenues 6.82%

$42,570 $33,446 Service Cost 27.28%

$66,939 $69,072 Service Revenue minus Cost -3.09%



$151,182 $117,914 Technology revenues 28.21%

$16,780 $21,190 Technology Cost -20.81%

$134,402 $96,724 Technology Revenue minus Cost 38.95%




Technology revenues for the nine months ended October 31, 2014 increased by $33.3 million, as compared to the same prior year periods primarily due to the settlement and license agreements with Verizon and Google/Motorola Mobility and Cisco, additional licensing revenues in excess of contractual minimums, and to a lesser extent the timing of revenue recognition related to various technology related projects.



Revenue and cash from the contractual minimums do not include any additional revenues from our AT&T agreement .